Exhibit 10.1

 

 

CREDIT AGREEMENT

 

by and among

 

SITEL CORPORATION

 

and

 

EACH OF ITS SUBSIDIARIES THAT ARE SIGNATORIES HERETO
as Borrowers,

 

THE LENDERS THAT ARE SIGNATORIES HERETO
as the Lenders,

 

WELLS FARGO FOOTHILL, INC.
as the Arranger, Administrative Agent, European Administrative Agent, Collateral
Agent and Fronting Lender

 

and

 

WELLS FARGO FINANCIAL CORPORATION CANADA,
as Canadian Administrative Agent

 

 

Dated as of August 19, 2005

 

 

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

 

TABLE OF CONTENTS

 

1.

DEFINITIONS AND CONSTRUCTION

 

 

 

 

 

1.1.

Definitions

 

 

1.2.

Accounting Terms

 

 

1.3.

Code

 

 

1.4.

Construction

 

 

1.5.

Schedules and Exhibits

 

 

 

 

 

2.

LOAN AND TERMS OF PAYMENT

 

 

 

 

 

 

2.1.

Revolver Advances

 

 

2.2.

Term Loan A

 

 

2.3.

Borrowing Procedures and Settlements

 

 

2.4.

Payments

 

 

2.5. [a05-15400_1ex10d1.htm#a251]

Overadvances [a05-15400_1ex10d1.htm#a251]

 

 

2.6. [a05-15400_1ex10d1.htm#a262]

Interest Rates and Letter of Credit Fee: Rates, Payments, and Calculations
[a05-15400_1ex10d1.htm#a262]

 

 

2.7. [a05-15400_1ex10d1.htm#a273]

Cash Management [a05-15400_1ex10d1.htm#a273]

 

 

2.8. [a05-15400_1ex10d1.htm#a284]

Crediting Payments; Clearance Charge [a05-15400_1ex10d1.htm#a284]

 

 

2.9. [a05-15400_1ex10d1.htm#a295]

Designated Account [a05-15400_1ex10d1.htm#a295]

 

 

2.10. [a05-15400_1ex10d1.htm#a2106]

Maintenance of Loan Accounts; Statements of Obligations
[a05-15400_1ex10d1.htm#a2106]

 

 

2.11. [a05-15400_1ex10d1.htm#a2117]

Fees [a05-15400_1ex10d1.htm#a2117]

 

 

2.12. [a05-15400_1ex10d1.htm#a2128]

Letters of Credit [a05-15400_1ex10d1.htm#a2128]

 

 

2.13. [a05-15400_1ex10d1.htm#a2139]

LIBOR Option [a05-15400_1ex10d1.htm#a2139]

 

 

2.14. [a05-15400_1ex10d1.htm#a21410]

Capital Requirements [a05-15400_1ex10d1.htm#a21410]

 

 

2.15. [a05-15400_1ex10d1.htm#a21511]

Joint and Several Liability of Borrowers [a05-15400_1ex10d1.htm#a21511]

 

 

2.16. [a05-15400_1ex10d1.htm#a21612]

Interest Act (Canada); Criminal Rate of Interest; Nominal Rate of Interest
[a05-15400_1ex10d1.htm#a21612]

 

 

 

 

 

3. [a05-15400_1ex10d1.htm#aCONDITIONSTERMOFAGREEMENT14]

CONDITIONS; TERM OF AGREEMENT
[a05-15400_1ex10d1.htm#aCONDITIONSTERMOFAGREEMENT14]

 

 

 

 

 

 

3.1. [a05-15400_1ex10d1.htm#a3116]

Conditions Precedent to the Initial Extension of Credit
[a05-15400_1ex10d1.htm#a3116]

 

 

3.2. [a05-15400_1ex10d1.htm#a3217]

Conditions Precedent to all Extensions of Credit [a05-15400_1ex10d1.htm#a3217]

 

 

3.3. [a05-15400_1ex10d1.htm#a3318]

Term [a05-15400_1ex10d1.htm#a3318]

 

 

3.4. [a05-15400_1ex10d1.htm#a3419]

Effect of Termination [a05-15400_1ex10d1.htm#a3419]

 

 

3.5. [a05-15400_1ex10d1.htm#a3520]

Early Termination by Borrowers [a05-15400_1ex10d1.htm#a3520]

 

 

 

 

 

4. [a05-15400_1ex10d1.htm#aREPRESENTATIONSANDWARRANTIES22]

REPRESENTATIONS AND WARRANTIES
[a05-15400_1ex10d1.htm#aREPRESENTATIONSANDWARRANTIES22]

 

 

 

 

 

 

4.1. [a05-15400_1ex10d1.htm#a4124]

No Encumbrances [a05-15400_1ex10d1.htm#a4124]

 

 

4.2. [a05-15400_1ex10d1.htm#a4225]

Eligible Accounts [a05-15400_1ex10d1.htm#a4225]

 

 

4.3. [a05-15400_1ex10d1.htm#a4326]

[Intentionally Omitted] [a05-15400_1ex10d1.htm#a4326]

 

 

4.4. [a05-15400_1ex10d1.htm#a4427]

Equipment [a05-15400_1ex10d1.htm#a4427]

 

 

4.5. [a05-15400_1ex10d1.htm#a4528]

Location of Inventory and Equipment [a05-15400_1ex10d1.htm#a4528]

 

 

4.6. [a05-15400_1ex10d1.htm#a4629]

Inventory Records [a05-15400_1ex10d1.htm#a4629]

 

 

4.7. [a05-15400_1ex10d1.htm#a4730]

State of Incorporation; Location of Chief Executive Office; Organizational
Identification Number; Commercial Tort Claims [a05-15400_1ex10d1.htm#a4730]

 

 

ii

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

 

 

4.8. [a05-15400_1ex10d1.htm#a481]

Due Organization and Qualification; Subsidiaries [a05-15400_1ex10d1.htm#a481]

 

 

4.9. [a05-15400_1ex10d1.htm#a492]

Due Authorization; No Conflict [a05-15400_1ex10d1.htm#a492]

 

 

4.10. [a05-15400_1ex10d1.htm#a4103]

Litigation [a05-15400_1ex10d1.htm#a4103]

 

 

4.11. [a05-15400_1ex10d1.htm#a4114]

No Material Adverse Change [a05-15400_1ex10d1.htm#a4114]

 

 

4.12. [a05-15400_1ex10d1.htm#a4125]

Fraudulent Transfer [a05-15400_1ex10d1.htm#a4125]

 

 

4.13. [a05-15400_1ex10d1.htm#a4136]

Employee Benefits [a05-15400_1ex10d1.htm#a4136]

 

 

4.14. [a05-15400_1ex10d1.htm#a4147]

Environmental Condition [a05-15400_1ex10d1.htm#a4147]

 

 

4.15. [a05-15400_1ex10d1.htm#a4158]

Intellectual Property [a05-15400_1ex10d1.htm#a4158]

 

 

4.16. [a05-15400_1ex10d1.htm#a4169]

Leases [a05-15400_1ex10d1.htm#a4169]

 

 

4.17. [a05-15400_1ex10d1.htm#a41710]

Deposit Accounts and Securities Accounts [a05-15400_1ex10d1.htm#a41710]

 

 

4.18. [a05-15400_1ex10d1.htm#a41811]

Complete Disclosure [a05-15400_1ex10d1.htm#a41811]

 

 

4.19. [a05-15400_1ex10d1.htm#a41912]

Indebtedness [a05-15400_1ex10d1.htm#a41912]

 

 

4.20. [a05-15400_1ex10d1.htm#a42013]

Withholdings and Remittances [a05-15400_1ex10d1.htm#a42013]

 

 

4.21. [a05-15400_1ex10d1.htm#a42114]

Payments to Employees and Others [a05-15400_1ex10d1.htm#a42114]

 

 

4.22. [a05-15400_1ex10d1.htm#a42215]

Term B Debt Documents [a05-15400_1ex10d1.htm#a42215]

 

 

 

 

 

5. [a05-15400_1ex10d1.htm#aAFFIRMATIVECOVENANTS17]

AFFIRMATIVE COVENANTS [a05-15400_1ex10d1.htm#aAFFIRMATIVECOVENANTS17]

 

 

 

 

 

 

5.1. [a05-15400_1ex10d1.htm#a5119]

Accounting System [a05-15400_1ex10d1.htm#a5119]

 

 

5.2. [a05-15400_1ex10d1.htm#a5220]

Collateral Reporting [a05-15400_1ex10d1.htm#a5220]

 

 

5.3. [a05-15400_1ex10d1.htm#a5321]

Financial Statements, Reports, Certificates [a05-15400_1ex10d1.htm#a5321]

 

 

5.4. [a05-15400_1ex10d1.htm#a5422]

Inspection [a05-15400_1ex10d1.htm#a5422]

 

 

5.5. [a05-15400_1ex10d1.htm#a5523]

Maintenance of Properties [a05-15400_1ex10d1.htm#a5523]

 

 

5.6. [a05-15400_1ex10d1.htm#a5624]

Taxes [a05-15400_1ex10d1.htm#a5624]

 

 

5.7. [a05-15400_1ex10d1.htm#a5725]

Insurance [a05-15400_1ex10d1.htm#a5725]

 

 

5.8. [a05-15400_1ex10d1.htm#a581]

Location of Inventory and Equipment [a05-15400_1ex10d1.htm#a581]

 

 

5.9. [a05-15400_1ex10d1.htm#a592]

Compliance with Laws [a05-15400_1ex10d1.htm#a592]

 

 

5.10. [a05-15400_1ex10d1.htm#a5103]

Leases [a05-15400_1ex10d1.htm#a5103]

 

 

5.11. [a05-15400_1ex10d1.htm#a5114]

Existence [a05-15400_1ex10d1.htm#a5114]

 

 

5.12. [a05-15400_1ex10d1.htm#a5125]

Environmental [a05-15400_1ex10d1.htm#a5125]

 

 

5.13. [a05-15400_1ex10d1.htm#a5136]

Disclosure Updates [a05-15400_1ex10d1.htm#a5136]

 

 

5.14. [a05-15400_1ex10d1.htm#a5147]

Control Agreements [a05-15400_1ex10d1.htm#a5147]

 

 

5.15. [a05-15400_1ex10d1.htm#a5158]

Formation of Subsidiaries; Further Assurances [a05-15400_1ex10d1.htm#a5158]

 

 

5.16. [a05-15400_1ex10d1.htm#a5169]

Term B Debt Documents [a05-15400_1ex10d1.htm#a5169]

 

 

 

 

 

6. [a05-15400_1ex10d1.htm#aNEGATIVECOVENANTS11]

NEGATIVE COVENANTS [a05-15400_1ex10d1.htm#aNEGATIVECOVENANTS11]

 

 

 

 

 

 

6.1. [a05-15400_1ex10d1.htm#a6113]

Indebtedness [a05-15400_1ex10d1.htm#a6113]

 

 

6.2. [a05-15400_1ex10d1.htm#a6214]

Liens [a05-15400_1ex10d1.htm#a6214]

 

 

6.3. [a05-15400_1ex10d1.htm#a6315]

Restrictions on Fundamental Changes [a05-15400_1ex10d1.htm#a6315]

 

 

6.4. [a05-15400_1ex10d1.htm#a6416]

Disposal of Assets [a05-15400_1ex10d1.htm#a6416]

 

 

6.5. [a05-15400_1ex10d1.htm#a6517]

Change Name [a05-15400_1ex10d1.htm#a6517]

 

 

6.6. [a05-15400_1ex10d1.htm#a6618]

Nature of Business [a05-15400_1ex10d1.htm#a6618]

 

 

6.7. [a05-15400_1ex10d1.htm#a6719]

Prepayments and Amendments [a05-15400_1ex10d1.htm#a6719]

 

 

6.8. [a05-15400_1ex10d1.htm#a6820]

Change of Control [a05-15400_1ex10d1.htm#a6820]

 

 

6.9. [a05-15400_1ex10d1.htm#a6921]

[Intentionally Omitted] [a05-15400_1ex10d1.htm#a6921]

 

 

6.10. [a05-15400_1ex10d1.htm#a61022]

Distributions [a05-15400_1ex10d1.htm#a61022]

 

 

iii

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

 

 

6.11. [a05-15400_1ex10d1.htm#a6111]

Accounting Methods [a05-15400_1ex10d1.htm#a6111]

 

 

6.12. [a05-15400_1ex10d1.htm#a6122]

Investments [a05-15400_1ex10d1.htm#a6122]

 

 

6.13. [a05-15400_1ex10d1.htm#a6133]

Transactions with Affiliates [a05-15400_1ex10d1.htm#a6133]

 

 

6.14. [a05-15400_1ex10d1.htm#a6144]

Use of Proceeds [a05-15400_1ex10d1.htm#a6144]

 

 

6.15. [a05-15400_1ex10d1.htm#a6155]

SITEL Mexico Holdings LLC and SITMEX-USA, LLC [a05-15400_1ex10d1.htm#a6155]

 

 

6.16. [a05-15400_1ex10d1.htm#a6166]

Non-Loan Party Subsidiaries; Immaterial Subsidiaries
[a05-15400_1ex10d1.htm#a6166]

 

 

6.17. [a05-15400_1ex10d1.htm#a6177]

Financial Covenants [a05-15400_1ex10d1.htm#a6177]

 

 

 

 

 

7. [a05-15400_1ex10d1.htm#aEVENTSOFDEFAULT9]

EVENTS OF DEFAULT [a05-15400_1ex10d1.htm#aEVENTSOFDEFAULT9]

 

 

 

 

 

8. [a05-15400_1ex10d1.htm#aTHELENDERGROUPSRIGHTSANDREMEDIES11]

THE LENDER GROUP’S RIGHTS AND REMEDIES
[a05-15400_1ex10d1.htm#aTHELENDERGROUPSRIGHTSANDREMEDIES11]

 

 

 

 

 

 

8.1. [a05-15400_1ex10d1.htm#a8113]

Rights and Remedies [a05-15400_1ex10d1.htm#a8113]

 

 

8.2. [a05-15400_1ex10d1.htm#a8214]

Remedies Cumulative [a05-15400_1ex10d1.htm#a8214]

 

 

 

 

 

9. [a05-15400_1ex10d1.htm#aTAXESANDEXPENSES16]

TAXES AND EXPENSES. [a05-15400_1ex10d1.htm#aTAXESANDEXPENSES16]

 

 

 

 

 

10. [a05-15400_1ex10d1.htm#aWAIVERSINDEMNIFICATION18]

WAIVERS; INDEMNIFICATION [a05-15400_1ex10d1.htm#aWAIVERSINDEMNIFICATION18]

 

 

 

 

 

 

10.1. [a05-15400_1ex10d1.htm#a10120]

Demand; Protest; etc. [a05-15400_1ex10d1.htm#a10120]

 

 

10.2. [a05-15400_1ex10d1.htm#a10221]

The Lender Group’s Liability for Borrower Collateral
[a05-15400_1ex10d1.htm#a10221]

 

 

10.3. [a05-15400_1ex10d1.htm#a10322]

Indemnification [a05-15400_1ex10d1.htm#a10322]

 

 

10.4. [a05-15400_1ex10d1.htm#a10423]

Currency Indemnity [a05-15400_1ex10d1.htm#a10423]

 

 

 

 

 

11. [a05-15400_1ex10d1.htm#aNOTICES25]

NOTICES [a05-15400_1ex10d1.htm#aNOTICES25]

 

 

 

 

 

12. [a05-15400_1ex10d1.htm#aCHOICEOFLAWANDVENUEJURYTRIALWAIV27]

CHOICE OF LAW AND VENUE; JURY TRIAL WAIVER
[a05-15400_1ex10d1.htm#aCHOICEOFLAWANDVENUEJURYTRIALWAIV27]

 

 

 

 

 

13. [a05-15400_1ex10d1.htm#aASSIGNMENTSANDPARTICIPATIONSSUCCESSO29]

ASSIGNMENTS AND PARTICIPATIONS; SUCCESSORS
[a05-15400_1ex10d1.htm#aASSIGNMENTSANDPARTICIPATIONSSUCCESSO29]

 

 

 

 

 

 

13.1. [a05-15400_1ex10d1.htm#a13131]

Assignments and Participations [a05-15400_1ex10d1.htm#a13131]

 

 

13.2. [a05-15400_1ex10d1.htm#a13232]

Successors [a05-15400_1ex10d1.htm#a13232]

 

 

 

 

 

14. [a05-15400_1ex10d1.htm#aAMENDMENTSWAIVERS34]

AMENDMENTS; WAIVERS [a05-15400_1ex10d1.htm#aAMENDMENTSWAIVERS34]

 

 

 

 

 

 

14.1. [a05-15400_1ex10d1.htm#a14136]

Amendments and Waivers [a05-15400_1ex10d1.htm#a14136]

 

 

14.2. [a05-15400_1ex10d1.htm#a14237]

Replacement of Holdout Lender [a05-15400_1ex10d1.htm#a14237]

 

 

14.3. [a05-15400_1ex10d1.htm#a14338]

No Waivers; Cumulative Remedies [a05-15400_1ex10d1.htm#a14338]

 

 

 

 

 

15. [a05-15400_1ex10d1.htm#aAGENTTHELENDERGROUP40]

AGENT; THE LENDER GROUP [a05-15400_1ex10d1.htm#aAGENTTHELENDERGROUP40]

 

 

 

 

 

 

15.1. [a05-15400_1ex10d1.htm#AppointmentAnd_131238]

Appointment and Authorization of Administrative Agent
[a05-15400_1ex10d1.htm#AppointmentAnd_131238]

 

 

15.2. [a05-15400_1ex10d1.htm#a15243]

Delegation of Duties [a05-15400_1ex10d1.htm#a15243]

 

 

15.3. [a05-15400_1ex10d1.htm#a15344]

Liability of Agents [a05-15400_1ex10d1.htm#a15344]

 

 

15.4. [a05-15400_1ex10d1.htm#a15445]

Reliance by Agents [a05-15400_1ex10d1.htm#a15445]

 

 

15.5. [a05-15400_1ex10d1.htm#a15546]

Notice of Default or Event of Default [a05-15400_1ex10d1.htm#a15546]

 

 

15.6. [a05-15400_1ex10d1.htm#a15647]

Credit Decision [a05-15400_1ex10d1.htm#a15647]

 

 

15.7. [a05-15400_1ex10d1.htm#a15748]

Costs and Expenses; Indemnification [a05-15400_1ex10d1.htm#a15748]

 

 

15.8. [a05-15400_1ex10d1.htm#a15849]

Agents in Individual Capacity [a05-15400_1ex10d1.htm#a15849]

 

 

15.9. [a05-15400_1ex10d1.htm#a15950]

Successor Agent [a05-15400_1ex10d1.htm#a15950]

 

 

15.10. [a05-15400_1ex10d1.htm#a151051]

Lender in Individual Capacity [a05-15400_1ex10d1.htm#a151051]

 

 

15.11. [a05-15400_1ex10d1.htm#a151152]

Withholding Taxes [a05-15400_1ex10d1.htm#a151152]

 

 

15.12. [a05-15400_1ex10d1.htm#a151253]

Collateral Matters [a05-15400_1ex10d1.htm#a151253]

 

 

iv

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

 

 

15.13. [a05-15400_1ex10d1.htm#a15131]

Restrictions on Actions by Lenders; Sharing of Payments
[a05-15400_1ex10d1.htm#a15131]

 

 

15.14. [a05-15400_1ex10d1.htm#a15142]

Agency for Perfection [a05-15400_1ex10d1.htm#a15142]

 

 

15.15. [a05-15400_1ex10d1.htm#a15153]

Payments by Agent to the Lenders [a05-15400_1ex10d1.htm#a15153]

 

 

15.16. [a05-15400_1ex10d1.htm#a15164]

Concerning the Collateral and Related Loan Documents
[a05-15400_1ex10d1.htm#a15164]

 

 

15.17. [a05-15400_1ex10d1.htm#a15175]

Field Audits and Examination Reports; Confidentiality; Disclaimers by Lenders;
Other Reports and Information [a05-15400_1ex10d1.htm#a15175]

 

 

15.18. [a05-15400_1ex10d1.htm#a15186]

Several Obligations; No Liability [a05-15400_1ex10d1.htm#a15186]

 

 

15.19. [a05-15400_1ex10d1.htm#a15197]

Bank Product Providers [a05-15400_1ex10d1.htm#a15197]

 

 

15.20. [a05-15400_1ex10d1.htm#a15208]

Quebec Security [a05-15400_1ex10d1.htm#a15208]

 

 

 

 

 

16. [a05-15400_1ex10d1.htm#aGENERALPROVISIONS1]

GENERAL PROVISIONS [a05-15400_1ex10d1.htm#aGENERALPROVISIONS1]

 

 

 

 

 

 

16.1. [a05-15400_1ex10d1.htm#a1613]

Intentionally Omitted [a05-15400_1ex10d1.htm#a1613]

 

 

16.2. [a05-15400_1ex10d1.htm#a1624]

Effectiveness [a05-15400_1ex10d1.htm#a1624]

 

 

16.3. [a05-15400_1ex10d1.htm#a1635]

Section Headings [a05-15400_1ex10d1.htm#a1635]

 

 

16.4. [a05-15400_1ex10d1.htm#a1646]

Interpretation [a05-15400_1ex10d1.htm#a1646]

 

 

16.5. [a05-15400_1ex10d1.htm#a1657]

Severability of Provisions [a05-15400_1ex10d1.htm#a1657]

 

 

16.6. [a05-15400_1ex10d1.htm#a1668]

Counterparts; Electronic Execution [a05-15400_1ex10d1.htm#a1668]

 

 

16.7. [a05-15400_1ex10d1.htm#a1679]

Revival and Reinstatement of Obligations [a05-15400_1ex10d1.htm#a1679]

 

 

16.8. [a05-15400_1ex10d1.htm#a16810]

Confidentiality [a05-15400_1ex10d1.htm#a16810]

 

 

16.9. [a05-15400_1ex10d1.htm#a16911]

Know Your Customer [a05-15400_1ex10d1.htm#a16911]

 

 

16.10. [a05-15400_1ex10d1.htm#a161012]

Integration [a05-15400_1ex10d1.htm#a161012]

 

 

16.11. [a05-15400_1ex10d1.htm#a161113]

Parent as Administrative Agent for Borrowers [a05-15400_1ex10d1.htm#a161113]

 

 

v

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

 

EXHIBITS AND SCHEDULES

 

Exhibit A-1

 

Form of Assignment and Acceptance

 

Exhibit B-1(A)

 

Form of US Borrowing Base Certificate

 

Exhibit B-1(B)

 

Form of Foreign Borrowing Base Certificate

 

Exhibit C-1

 

Form of Compliance Certificate

 

Exhibit L-1

 

Form of LIBOR Notice

 

Exhibit U-1

 

Form of US Security Agreement

 

 

 

 

 

Schedule A-1

 

Administrative Agent’s Account

 

Schedule A-2

 

Canadian Administrative Agent’s Account

 

Schedule A-3

 

European Administrative Agent’s Account

 

Schedule C-1

 

Commitments

 

Schedule D-1

 

Designated Account

 

Schedule I-1

 

Immaterial Subsidiaries

 

Schedule N-1

 

Non-Loan Party Subsidiaries

 

Schedule P-1

 

Permitted Liens

 

Schedule R-1

 

Real Property

 

Schedule S-1

 

Significant Subsidiaries

 

Schedule 1.1 [a05-15400_1ex10d1.htm#Schedule1_1_112708]

 

Definitions [a05-15400_1ex10d1.htm#Schedule1_1_112708]

 

Schedule 2.7(a)

 

Cash Management Banks

 

Schedule 3.1

 

Conditions Precedent

 

Schedule 4.5

 

Locations of Inventory and Equipment

 

Schedule 4.7(a)

 

States of Organization

 

Schedule 4.7(b)

 

Chief Executive Offices

 

Schedule 4.7(c)

 

Organizational Identification Numbers

 

Schedule 4.7(d)

 

Commercial Tort Claims

 

Schedule 4.8(b)

 

Capitalization of Borrowers

 

Schedule 4.8(c)

 

Capitalization of Borrowers’ Subsidiaries

 

Schedule 4.10

 

Litigation

 

Schedule 4.13

 

Employee Benefits

 

Schedule 4.14

 

Environmental Matters

 

Schedule 4.15

 

Intellectual Property

 

Schedule 4.17

 

Deposit Accounts and Securities Accounts

 

Schedule 4.19

 

Permitted Indebtedness

 

Schedule 5.2

 

Collateral Reporting

 

Schedule 5.3

 

Financial Statements, Reports, Certificates

 

Schedule 6.12

 

Investments

 

Schedule 6.13

 

Transactions with Affiliates

 

 

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CREDIT AGREEMENT

 

THIS CREDIT AGREEMENT (this “Agreement”), is entered into as of August 19, 2005
by and among the lenders identified on the signature pages hereof (such lenders,
together with their respective successors and permitted assigns and the Fronting
Lender, are referred to hereinafter each individually as a “Lender” and
collectively as the “Lenders”), and WELLS FARGO FOOTHILL, INC., a California
corporation, as the arranger, administrative agent for the Lenders (in such
capacity, together with its successors and assigns in such capacity,
“Administrative Agent”), European administrative agent for the Lenders (in such
capacity, together with its successors and assigns in such capacity, “European
Administrative Agent”), collateral agent for the Lender Group and the Bank
Product Providers (in such capacity, together with its successors and assigns in
such capacity, “Collateral Agent”) and fronting lender for the Lenders (in such
capacity, together with its successors and assigns in such capacity, “Fronting
Lender”), WELLS FARGO FINANCIAL CORPORATION CANADA, a Nova Scotia unlimited
liability company, as Canadian administrative agent for the Lenders (in such
capacity, together with its successors and assigns in such capacity, “Canadian
Administrative Agent”) and SITEL CORPORATION, a Minnesota corporation
(“Parent”), and each of Parent’s Subsidiaries identified on the signature
pages hereof and that from time to time become parties to this Agreement (such
Subsidiaries, together with Parent, are referred to hereinafter each
individually as a “Borrower”, and collectively, as the “Borrowers”).

 

The parties agree as follows:

 

1.                                      DEFINITIONS AND CONSTRUCTION.

 

1.1.                            DEFINITIONS.

 

Capitalized terms used in this Agreement shall have the meanings specified
therefor on Schedule 1.1.

 

1.2.                            ACCOUNTING TERMS.

 

All accounting terms not specifically defined herein shall be construed in
accordance with GAAP; provided, that if at any time any change in GAAP or the
application thereof would affect the computation of any financial ratio or
financial requirement set forth in any Loan Document and the Administrative
Borrower notifies the Administrative Agent that the Administrative Borrower
requests an amendment of such provision to eliminate the effect of such change
occurring after the date hereof in GAAP or the application thereof (or if the
Administrative Agent notifies the Administrative Borrower that the Required
Lenders request an amendment of any provision for such purpose), regardless of
whether such notice is given before or after such change, the Administrative
Agent, the Lenders and Borrowers shall negotiate in good faith to amend such
provision to preserve the original intent thereof in light of such change
(subject to the approval of the Required Lenders); provided that, until so
amended, (i) such ratio or requirement shall continue to be computed in
accordance with GAAP as in effect and as applied prior to such change therein
and (ii) Borrowers shall

 

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provide to the Administrative Agent and the Lenders financial statements and
other documents required under this Agreement which include a reconciliation
between calculations of such ratio or requirement made before and after giving
effect to such change in GAAP or the application thereof.  When used herein, the
term “financial statements” shall include the notes and schedules thereto. 
Whenever the term “Borrowers” or the term “Parent” is used in respect of a
financial covenant or a related definition, it shall be understood to mean
Parent and its Subsidiaries on a consolidated basis unless the context clearly
requires otherwise.

 

1.3.                            CODE.

 

Any terms used in this Agreement that are defined in the Code shall be construed
and defined as set forth in the Code unless otherwise defined herein, provided,
however, that to the extent that the Code is used to define any term herein and
such term is defined differently in different Articles of the Code, the
definition of such term contained in Article 9 of the Code shall govern and when
used to describe a category or categories of Collateral owned by a Canadian
Borrower, such term shall have the definition provided in the PPSA.

 

1.4.                            CONSTRUCTION.

 

Unless the context of this Agreement or any other Loan Document clearly requires
otherwise, references to the plural include the singular, references to the
singular include the plural, the terms “includes” and “including” are not
limiting, and the term “or” has, except where otherwise indicated, the inclusive
meaning represented by the phrase “and/or.”  The words “hereof,” “herein,”
“hereby,” “hereunder,” and similar terms in this Agreement or any other Loan
Document refer to this Agreement or such other Loan Document, as the case may
be, as a whole and not to any particular provision of this Agreement or such
other Loan Document, as the case may be.  Section, subsection, clause, schedule,
and exhibit references herein are to this Agreement unless otherwise specified. 
Any reference in this Agreement or in the other Loan Documents to any agreement,
instrument, or document shall include all alterations, amendments, changes,
extensions, modifications, renewals, replacements, substitutions, joinders, and
supplements, thereto and thereof, as applicable (subject to any restrictions on
such alterations, amendments, changes, extensions, modifications, renewals,
replacements, substitutions, joinders, and supplements set forth herein).  Any
reference herein to the satisfaction or payment or repayment in full of the
Obligations shall mean the payment or repayment in full in cash (or
collateralization in accordance with the terms hereof) of all Obligations other
than contingent indemnification Obligations and other than any Bank Product
Obligations that, at such time, are allowed by the applicable Bank Product
Provider to remain outstanding and are not required to be repaid or
collateralized pursuant to the provisions of this Agreement.  Any reference
herein to any Person shall be construed to include such Person’s successors and
assigns.  Any requirement of a writing contained herein or in the other Loan
Documents shall be satisfied by the transmission of a Record and any Record
transmitted shall constitute a representation and warranty as to the accuracy
and completeness of the information contained therein.

 

2

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1.5.                            SCHEDULES AND EXHIBITS.

 

All of the schedules and exhibits attached to this Agreement shall be deemed
incorporated herein by reference.

 

2.                                      LOAN AND TERMS OF PAYMENT.

 

2.1.                            REVOLVER ADVANCES.

 

(A)                                  SUBJECT TO THE TERMS AND CONDITIONS OF THIS
AGREEMENT, AND DURING THE TERM OF THIS AGREEMENT, (I) EACH LENDER WITH A US
REVOLVER COMMITMENT AGREES (SEVERALLY, NOT JOINTLY OR JOINTLY AND SEVERALLY) TO
MAKE ADVANCES (“US ADVANCES”) TO US BORROWERS IN AN AGGREGATE DOLLAR EQUIVALENT
PRINCIPAL AMOUNT AT ANY ONE TIME OUTSTANDING NOT TO EXCEED SUCH LENDER’S PRO
RATA SHARE OF AN AMOUNT EQUAL TO THE LESSER OF (X) THE MAXIMUM US REVOLVER
AMOUNT LESS THE US LETTER OF CREDIT USAGE, OR (Y) THE US BORROWING BASE LESS THE
US LETTER OF CREDIT USAGE, (II) EACH LENDER WITH A CANADIAN REVOLVER COMMITMENT
AGREES (SEVERALLY, NOT JOINTLY OR JOINTLY AND SEVERALLY) TO MAKE ADVANCES
(“CANADIAN ADVANCES”) TO CANADIAN BORROWERS IN AN AGGREGATE DOLLAR EQUIVALENT
PRINCIPAL AMOUNT AT ANY ONE TIME OUTSTANDING NOT TO EXCEED SUCH LENDER’S PRO
RATA SHARE OF AN AMOUNT EQUAL TO THE LESSER OF (X) THE MAXIMUM CANADIAN REVOLVER
AMOUNT LESS THE CANADIAN LETTER OF CREDIT USAGE, OR (Y) THE CANADIAN BORROWING
BASE LESS THE CANADIAN LETTER OF CREDIT USAGE AND (III) EACH LENDER WITH A
EUROPEAN REVOLVER COMMITMENT AGREES (SEVERALLY, NOT JOINTLY OR JOINTLY AND
SEVERALLY) TO MAKE ADVANCES (“EUROPEAN ADVANCES”) TO EUROPEAN BORROWERS IN AN
AGGREGATE DOLLAR EQUIVALENT PRINCIPAL AMOUNT AT ANY ONE TIME OUTSTANDING NOT TO
EXCEED SUCH LENDER’S PRO RATA SHARE OF AN AMOUNT EQUAL TO THE LESSER OF (X) THE
MAXIMUM EUROPEAN REVOLVER AMOUNT LESS THE EUROPEAN LETTER OF CREDIT USAGE, OR
(Y) THE EUROPEAN BORROWING BASE LESS THE EUROPEAN LETTER OF CREDIT USAGE. 
NOTWITHSTANDING ANYTHING TO THE CONTRARY CONTAINED HEREIN, WITH RESPECT TO ANY
OFFSHORE CURRENCY RATE LOAN, THE PRO RATA SHARE OF EACH NON-OFFSHORE CURRENCY
LENDER SHALL BE FRONTED BY THE FRONTING LENDER (WITH EACH NON-OFFSHORE CURRENCY
LENDER HEREBY AGREEING TO PARTICIPATE IN THE RISK ASSOCIATED WITH SUCH OFFSHORE
CURRENCY RATE LOAN IN ACCORDANCE WITH SECTION 2.17), WITH EACH NON-OFFSHORE
CURRENCY LENDER HAVING NO OBLIGATION OR COMMITMENT TO FUND IN AN APPROVED
OFFSHORE CURRENCY, EXCEPT AS PROVIDED IN SECTION 2.17.

 

(B)                                 ANYTHING TO THE CONTRARY IN THIS SECTION 2.1
NOTWITHSTANDING, ADMINISTRATIVE AGENT SHALL HAVE THE RIGHT TO ESTABLISH RESERVES
(WITHOUT DUPLICATION FOR RESERVES ESTABLISHED PURSUANT TO THE DEFINITIONS OF US
BORROWING BASE AND FOREIGN BORROWING BASE) IN SUCH AMOUNTS, AND WITH RESPECT TO
SUCH MATTERS, AS ADMINISTRATIVE AGENT IN ITS PERMITTED DISCRETION SHALL DEEM
NECESSARY OR APPROPRIATE, AGAINST THE US BORROWING BASE OR THE FOREIGN BORROWING
BASE, AS THE CASE MAY BE, INCLUDING RESERVES (I) WITH RESPECT TO (A) SUMS THAT
BORROWERS ARE REQUIRED TO PAY BY ANY SECTION OF THIS AGREEMENT OR ANY OTHER LOAN
DOCUMENT (SUCH AS TAXES, ASSESSMENTS, INSURANCE PREMIUMS, OR, IN THE CASE OF
LEASED ASSETS, RENTS OR OTHER AMOUNTS PAYABLE UNDER SUCH LEASES) AND HAVE FAILED
TO PAY, AND (B) AMOUNTS OWING BY BORROWERS OR THEIR SIGNIFICANT SUBSIDIARIES TO
ANY PERSON TO THE EXTENT SECURED BY A LIEN ON, OR TRUST OVER, ANY OF THE
COLLATERAL (OTHER THAN A PERMITTED LIEN), WHICH LIEN OR TRUST, IN THE PERMITTED
DISCRETION OF ADMINISTRATIVE AGENT LIKELY WOULD HAVE A

 

3

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PRIORITY SUPERIOR TO THE AGENT’S LIENS (SUCH AS LIENS OR TRUSTS IN FAVOR OF
LANDLORDS, WAREHOUSEMEN, CARRIERS, MECHANICS, MATERIALMEN, LABORERS, OR
SUPPLIERS, OR LIENS OR TRUSTS FOR AD VALOREM, INCOME, PAYROLL, EXCISE, SALES,
PENSION PLAN OBLIGATIONS, OR OTHER TAXES WHERE GIVEN PRIORITY UNDER APPLICABLE
LAW) IN AND TO SUCH ITEM OF THE COLLATERAL AND (II) AFTER THE OCCURRENCE AND
DURING THE CONTINUANCE OF AN EVENT OF DEFAULT, WITH RESPECT TO SUCH OTHER
MATTERS AS ADMINISTRATIVE AGENT IN ITS PERMITTED DISCRETION SHALL DEEM NECESSARY
OR APPROPRIATE.

 

(C)                                  AMOUNTS BORROWED PURSUANT TO THIS
SECTION 2.1 CONSISTING OF US ADVANCES OR EUROPEAN ADVANCES SHALL BE DENOMINATED
IN DOLLARS OR AN APPROVED OFFSHORE CURRENCY, AND AMOUNTS BORROWED PURSUANT TO
THIS SECTION 2.1 CONSISTING OF CANADIAN ADVANCES SHALL BE DENOMINATED IN DOLLARS
OR CANADIAN DOLLARS.

 

(D)                                 AMOUNTS BORROWED PURSUANT TO THIS
SECTION 2.1 MAY BE REPAID AND, SUBJECT TO THE TERMS AND CONDITIONS OF THIS
AGREEMENT, REBORROWED AT ANY TIME DURING THE TERM OF THIS AGREEMENT.

 

2.2.                            TERM LOAN A.

 

(A)                                  SUBJECT TO THE TERMS AND CONDITIONS OF
SECTION 3.2 OF THIS AGREEMENT AND THE PRIOR OR CONTEMPORANEOUS FUNDING OF THE
TERM B DEBT, WITHIN 35 DAYS FOLLOWING THE CLOSING DATE EACH LENDER WITH A TERM
LOAN A COMMITMENT AGREES (SEVERALLY, NOT JOINTLY OR JOINTLY AND SEVERALLY) TO
MAKE IN ONE DRAW TERM LOANS (COLLECTIVELY, THE “TERM LOAN A”) TO US BORROWERS IN
AN AMOUNT EQUAL TO SUCH LENDER’S PRO RATA SHARE OF THE TERM LOAN A AMOUNT.  THE
TERM LOAN A SHALL, SUBJECT TO ADJUSTMENT AS PROVIDED BELOW, BE REPAID ON THE
FOLLOWING DATES AND IN THE FOLLOWING AMOUNTS:

 

Date

 

Installment Amount

 

The first day of each calendar month commencing on the first day of the calendar
month immediately following the first full calendar month after the making of
the Term Loan A

 

$

300,000

 

 

Except as provided in Section 2.4(c) hereof and except in connection with the
repayment of all of the Obligations and the termination of this Agreement, the
US Borrowers may, at any time and from time to time, upon at least 5 Business
Days’ prior written notice to Administrative Agent, prepay the principal amount
of the Term Loan A in whole or in part (each an “Optional Prepayment”); provided
that any such partial prepayment shall be in an amount equal to $5,000,000 or a
higher integral multiple of $1,000,000.  The outstanding unpaid principal
balance and all accrued and unpaid interest under the Term Loan A shall be due
and payable on the date of termination of this Agreement, whether by its terms,
by prepayment, or by acceleration.  All amounts outstanding under the Term Loan
A shall constitute Obligations.

 

4

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(B)                                 EACH OPTIONAL PREPAYMENT OF THE TERM LOAN A
SHALL BE APPLIED TO THE REMAINING INSTALLMENTS DUE ON THE TERM LOAN A IN INVERSE
ORDER OF MATURITY.

 

(C)                                  ONCE ANY PORTION OF THE TERM LOAN A HAS
BEEN PAID OR PREPAID, IT MAY NOT BE REBORROWED.

 

(D)                                 AMOUNTS BORROWED PURSUANT TO THIS
SECTION 2.2 SHALL BE DENOMINATED IN DOLLARS.

 

2.3.                            BORROWING PROCEDURES AND SETTLEMENTS.

 

(A)                                  PROCEDURE FOR BORROWING.

 

(I)                                     EACH US BORROWING SHALL BE MADE BY AN
IRREVOCABLE WRITTEN REQUEST BY AN AUTHORIZED PERSON DELIVERED TO ADMINISTRATIVE
AGENT SPECIFYING (I) THE AMOUNT OF SUCH US BORROWING, (II) THE CURRENCY IN WHICH
SUCH US BORROWING WILL BE MADE AND (III) THE REQUESTED FUNDING DATE, WHICH SHALL
BE A BUSINESS DAY.  UNLESS US SWING LENDER IS NOT OBLIGATED TO MAKE A US SWING
LOAN PURSUANT TO SECTION 2.3(B) BELOW OR ADMINISTRATIVE BORROWER ELECTS SUCH US
BORROWING TO BE AN OFFSHORE CURRENCY RATE LOAN OR OTHER LIBOR RATE LOAN PURSUANT
TO SECTION 2.13(B), SUCH NOTICE MUST BE RECEIVED BY ADMINISTRATIVE AGENT NO
LATER THAN 10:00 A.M. (CALIFORNIA TIME) ON THE BUSINESS DAY THAT IS THE
REQUESTED FUNDING DATE; PROVIDED, HOWEVER, THAT IF (X) US SWING LENDER IS NOT
OBLIGATED TO MAKE A US SWING LOAN AS TO A REQUESTED US BORROWING AND
ADMINISTRATIVE BORROWER HAS NOT ELECTED SUCH US BORROWING BE AN OFFSHORE
CURRENCY RATE LOAN OR OTHER LIBOR RATE LOAN, SUCH NOTICE MUST BE RECEIVED BY
ADMINISTRATIVE AGENT NO LATER THAN 10:00 A.M. (CALIFORNIA TIME) ON THE BUSINESS
DAY PRIOR TO THE DATE THAT IS THE REQUESTED FUNDING DATE, (Y) ADMINISTRATIVE
BORROWER REQUESTS THAT SUCH US BORROWING BE A LIBOR RATE LOAN DENOMINATED IN
DOLLARS, SUCH NOTICE MUST BE RECEIVED BY ADMINISTRATIVE AGENT NO LATER THAN
11:00 A.M. (CALIFORNIA TIME) AT LEAST 3 BUSINESS DAYS PRIOR TO THE REQUESTED
FUNDING DATE, OR (Z) ADMINISTRATIVE BORROWER REQUESTS THAT SUCH US BORROWING BE
AN OFFSHORE CURRENCY RATE LOAN, SUCH NOTICE MUST BE RECEIVED BY ADMINISTRATIVE
AGENT NO LATER THAN 10:00 A.M. (CALIFORNIA TIME) 3 BUSINESS DAYS PRIOR TO THE
DATE THAT IS THE REQUESTED FUNDING DATE.  AT ADMINISTRATIVE AGENT’S ELECTION
WITH RESPECT TO US BORROWINGS DENOMINATED IN DOLLARS, IN LIEU OF DELIVERING THE
ABOVE-DESCRIBED WRITTEN REQUEST, ANY AUTHORIZED PERSON MAY GIVE ADMINISTRATIVE
AGENT TELEPHONIC NOTICE OF SUCH REQUEST BY THE REQUIRED TIME.  IN SUCH
CIRCUMSTANCES, US BORROWERS AGREE THAT ANY SUCH TELEPHONIC NOTICE WILL BE
CONFIRMED IN WRITING WITHIN 24 HOURS OF THE GIVING OF SUCH TELEPHONIC NOTICE,
BUT THE FAILURE TO PROVIDE SUCH WRITTEN CONFIRMATION SHALL NOT AFFECT THE
VALIDITY OF THE REQUEST.

 

(II)                                  EACH CANADIAN BORROWING SHALL BE MADE BY
AN IRREVOCABLE WRITTEN REQUEST BY AN AUTHORIZED PERSON DELIVERED TO CANADIAN
ADMINISTRATIVE AGENT SPECIFYING (I) THE AMOUNT OF SUCH CANADIAN BORROWING,
(II) THE CURRENCY IN WHICH SUCH CANADIAN BORROWING WILL BE MADE AND (III) THE
REQUESTED FUNDING DATE, WHICH SHALL BE A BUSINESS DAY.  UNLESS ADMINISTRATIVE
BORROWER ELECTS SUCH CANADIAN BORROWING TO BE A LIBOR RATE LOAN PURSUANT TO
SECTION 2.13(B), SUCH NOTICE MUST BE RECEIVED BY CANADIAN ADMINISTRATIVE AGENT
NO LATER THAN 10:00 A.M. (CALIFORNIA TIME) ON THE BUSINESS DAY PRIOR TO

 

5

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THE DATE THAT IS THE REQUESTED FUNDING DATE; PROVIDED, HOWEVER, THAT IF
ADMINISTRATIVE BORROWER REQUESTS THAT SUCH CANADIAN BORROWING BE A LIBOR RATE
LOAN DENOMINATED IN DOLLARS OR CANADIAN DOLLARS, SUCH NOTICE MUST BE RECEIVED BY
CANADIAN ADMINISTRATIVE AGENT NO LATER THAN 11:00 A.M. (CALIFORNIA TIME) AT
LEAST 3 BUSINESS DAYS PRIOR TO THE REQUESTED FUNDING DATE.

 

(III)                               EACH EUROPEAN BORROWING SHALL BE MADE BY AN
IRREVOCABLE WRITTEN REQUEST BY AN AUTHORIZED PERSON DELIVERED TO EUROPEAN
ADMINISTRATIVE AGENT SPECIFYING (I) THE AMOUNT OF SUCH EUROPEAN BORROWING,
(II) THE CURRENCY IN WHICH SUCH EUROPEAN BORROWING WILL BE MADE AND (III) THE
REQUESTED FUNDING DATE, WHICH SHALL BE A BUSINESS DAY.  UNLESS EUROPEAN SWING
LENDER IS NOT OBLIGATED TO MAKE A EUROPEAN SWING LOAN PURSUANT TO
SECTION 2.3(B) BELOW OR ADMINISTRATIVE BORROWER ELECTS SUCH EUROPEAN BORROWING
TO BE AN OFFSHORE CURRENCY RATE LOAN OR OTHER LIBOR RATE LOAN PURSUANT TO
SECTION 2.13(B), SUCH NOTICE MUST BE RECEIVED BY EUROPEAN ADMINISTRATIVE AGENT
NO LATER THAN 10:00 A.M. (CALIFORNIA TIME) ON THE BUSINESS DAY THAT IS THE
REQUESTED FUNDING DATE; PROVIDED, HOWEVER, THAT IF (X) EUROPEAN SWING LENDER IS
NOT OBLIGATED TO MAKE A EUROPEAN SWING LOAN AS TO A REQUESTED EUROPEAN BORROWING
AND ADMINISTRATIVE BORROWER HAS NOT ELECTED SUCH EUROPEAN BORROWING BE AN
OFFSHORE CURRENCY RATE LOAN OR OTHER LIBOR RATE LOAN, SUCH NOTICE MUST BE
RECEIVED BY EUROPEAN ADMINISTRATIVE AGENT NO LATER THAN 10:00 A.M. (CALIFORNIA
TIME) ON THE BUSINESS DAY PRIOR TO THE DATE THAT IS THE REQUESTED FUNDING DATE,
(Y) ADMINISTRATIVE BORROWER REQUESTS THAT SUCH EUROPEAN BORROWING BE A LIBOR
RATE LOAN DENOMINATED IN DOLLARS, SUCH NOTICE MUST BE RECEIVED BY EUROPEAN
ADMINISTRATIVE AGENT NO LATER THAN 11:00 A.M. (CALIFORNIA TIME) AT LEAST 3
BUSINESS DAYS PRIOR TO THE REQUESTED FUNDING DATE, OR (Z) ADMINISTRATIVE
BORROWER REQUESTS THAT SUCH EUROPEAN BORROWING BE AN OFFSHORE CURRENCY RATE
LOAN, SUCH NOTICE MUST BE RECEIVED BY EUROPEAN ADMINISTRATIVE AGENT NO LATER
THAN 10:00 A.M. (CALIFORNIA TIME) 3 BUSINESS DAYS PRIOR TO THE DATE THAT IS THE
REQUESTED FUNDING DATE.  AT EUROPEAN ADMINISTRATIVE AGENT’S ELECTION WITH
RESPECT TO EUROPEAN BORROWINGS DENOMINATED IN DOLLARS, IN LIEU OF DELIVERING THE
ABOVE-DESCRIBED WRITTEN REQUEST, ANY AUTHORIZED PERSON MAY GIVE EUROPEAN
ADMINISTRATIVE AGENT TELEPHONIC NOTICE OF SUCH REQUEST BY THE REQUIRED TIME.  IN
SUCH CIRCUMSTANCES, EUROPEAN BORROWERS AGREE THAT ANY SUCH TELEPHONIC NOTICE
WILL BE CONFIRMED IN WRITING WITHIN 24 HOURS OF THE GIVING OF SUCH TELEPHONIC
NOTICE, BUT THE FAILURE TO PROVIDE SUCH WRITTEN CONFIRMATION SHALL NOT AFFECT
THE VALIDITY OF THE REQUEST.

 

(IV)                              THE BORROWING OF THE TERM LOAN A SHALL BE MADE
BY AN IRREVOCABLE WRITTEN REQUEST BY AN AUTHORIZED PERSON DELIVERED TO
ADMINISTRATIVE AGENT.  UNLESS ADMINISTRATIVE BORROWER ELECTS SUCH BORROWING TO
BE A LIBOR RATE LOAN PURSUANT TO SECTION 2.13(B), SUCH NOTICE MUST BE RECEIVED
BY ADMINISTRATIVE AGENT NO LATER THAN 10:00 A.M. (CALIFORNIA TIME) ON THE
BUSINESS DAY PRIOR TO THE DATE THAT IS THE REQUESTED FUNDING DATE SPECIFYING THE
REQUESTED FUNDING DATE, WHICH SHALL BE A BUSINESS DAY; PROVIDED, HOWEVER, THAT
IF ADMINISTRATIVE BORROWER REQUESTS THAT SUCH BORROWING BE A LIBOR RATE LOAN,
SUCH NOTICE MUST BE RECEIVED BY ADMINISTRATIVE AGENT NO LATER THAN 11:00 A.M.
(CALIFORNIA TIME) AT LEAST 3 BUSINESS DAYS PRIOR TO THE REQUESTED FUNDING DATE. 
AT ADMINISTRATIVE AGENT’S ELECTION, IN LIEU OF DELIVERING THE ABOVE-DESCRIBED
WRITTEN REQUEST, ANY AUTHORIZED PERSON MAY GIVE ADMINISTRATIVE AGENT TELEPHONIC
NOTICE OF SUCH REQUEST BY

 

6

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THE REQUIRED TIME.  IN SUCH CIRCUMSTANCES, US BORROWERS AGREE THAT ANY SUCH
TELEPHONIC NOTICE WILL BE CONFIRMED IN WRITING WITHIN 24 HOURS OF THE GIVING OF
SUCH TELEPHONIC NOTICE, BUT THE FAILURE TO PROVIDE SUCH WRITTEN CONFIRMATION
SHALL NOT AFFECT THE VALIDITY OF THE REQUEST.

 

(B)                                 MAKING OF SWING LOANS.

 

(I)                                     IN THE CASE OF A REQUEST FOR A US
ADVANCE AND SO LONG AS (I) SUCH US ADVANCE IS TO BE DENOMINATED IN DOLLARS AND
(II) EITHER (A) THE AGGREGATE AMOUNT OF US SWING LOANS MADE SINCE THE LAST
SETTLEMENT DATE AND NOT SINCE REPAID PLUS THE AMOUNT OF THE REQUESTED US ADVANCE
DOES NOT EXCEED $5,000,000, OR (B) US SWING LENDER, IN ITS SOLE DISCRETION,
SHALL AGREE TO MAKE A US SWING LOAN NOTWITHSTANDING THE FOREGOING LIMITATION, US
SWING LENDER, AS A LENDER, SHALL MAKE A US ADVANCE IN THE AMOUNT OF SUCH US
BORROWING (ANY SUCH US ADVANCE MADE SOLELY BY US SWING LENDER AS A LENDER
PURSUANT TO THIS SECTION 2.3(B)(I) BEING REFERRED TO AS A “US SWING LOAN” AND
SUCH US ADVANCES BEING REFERRED TO COLLECTIVELY AS “US SWING LOANS”) AVAILABLE
TO US BORROWERS ON THE FUNDING DATE APPLICABLE THERETO BY TRANSFERRING
IMMEDIATELY AVAILABLE FUNDS TO THE APPLICABLE US DESIGNATED ACCOUNT.  EACH US
SWING LOAN SHALL BE DEEMED TO BE A US ADVANCE HEREUNDER AND SHALL BE SUBJECT TO
ALL THE TERMS AND CONDITIONS APPLICABLE TO OTHER US ADVANCES, EXCEPT THAT ALL
PAYMENTS ON ANY US SWING LOAN SHALL BE PAYABLE TO US SWING LENDER AS A LENDER
SOLELY FOR ITS OWN ACCOUNT.  SUBJECT TO THE PROVISIONS OF SECTION 2.3(D)(IV), US
SWING LENDER AS A LENDER SHALL NOT MAKE AND SHALL NOT BE OBLIGATED TO MAKE ANY
US SWING LOAN IF US SWING LENDER HAS ACTUAL KNOWLEDGE THAT (I) ONE OR MORE OF
THE APPLICABLE CONDITIONS PRECEDENT SET FORTH IN SECTION 3.1 OR 3.2 ARE REQUIRED
TO, BUT WILL NOT, BE SATISFIED ON THE REQUESTED FUNDING DATE FOR THE APPLICABLE
US BORROWING UNLESS SUCH CONDITION HAS BEEN WAIVED IN ACCORDANCE WITH THE TERMS
OF THIS AGREEMENT, OR (II) THE REQUESTED US BORROWING WOULD EXCEED THE US
AVAILABILITY ON SUCH FUNDING DATE.  US SWING LENDER AS A LENDER SHALL NOT
OTHERWISE BE REQUIRED TO DETERMINE WHETHER THE APPLICABLE CONDITIONS PRECEDENT
SET FORTH IN SECTION 3 HAVE BEEN SATISFIED ON THE FUNDING DATE APPLICABLE
THERETO PRIOR TO MAKING ANY US SWING LOAN.  THE US SWING LOANS SHALL BE SECURED
BY THE AGENT’S LIENS IN THE US COLLATERAL, CONSTITUTE US ADVANCES AND
OBLIGATIONS HEREUNDER, AND BEAR INTEREST AT THE RATE APPLICABLE FROM TIME TO
TIME TO US ADVANCES THAT ARE BASE RATE LOANS.

 

(II)                                  IN THE CASE OF A REQUEST FOR A CANADIAN
ADVANCE DENOMINATED IN DOLLARS OR CANADIAN DOLLARS AND SO LONG AS EITHER (I) THE
DOLLAR EQUIVALENT OF THE AGGREGATE AMOUNT OF CANADIAN SWING LOANS MADE SINCE THE
LAST SETTLEMENT DATE AND NOT SINCE REPAID PLUS THE DOLLAR EQUIVALENT AMOUNT OF
THE REQUESTED CANADIAN ADVANCE DOES NOT EXCEED $2,500,000, OR (II) CANADIAN
SWING LENDER, IN ITS SOLE DISCRETION, SHALL AGREE TO MAKE A CANADIAN SWING LOAN
NOTWITHSTANDING THE FOREGOING LIMITATION, CANADIAN SWING LENDER, AS A LENDER,
SHALL MAKE A CANADIAN ADVANCE IN THE AMOUNT OF SUCH CANADIAN BORROWING (ANY SUCH
CANADIAN ADVANCE MADE SOLELY BY CANADIAN SWING LENDER AS A LENDER PURSUANT TO
THIS SECTION 2.3(B)(II) BEING REFERRED TO AS A “CANADIAN SWING LOAN” AND SUCH
CANADIAN ADVANCES BEING REFERRED TO COLLECTIVELY AS “CANADIAN SWING LOANS”)
AVAILABLE TO CANADIAN BORROWERS ON THE FUNDING DATE APPLICABLE THERETO BY
TRANSFERRING IMMEDIATELY AVAILABLE FUNDS TO THE APPLICABLE CANADIAN DESIGNATED
ACCOUNT.  EACH CANADIAN SWING LOAN SHALL BE DEEMED TO BE A CANADIAN ADVANCE
HEREUNDER AND SHALL BE SUBJECT TO ALL THE TERMS AND CONDITIONS APPLICABLE TO
OTHER CANADIAN ADVANCES, EXCEPT THAT ALL PAYMENTS ON ANY CANADIAN

 

7

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SWING LOAN SHALL BE PAYABLE TO CANADIAN SWING LENDER AS A LENDER SOLELY FOR ITS
OWN ACCOUNT.  SUBJECT TO THE PROVISIONS OF SECTION 2.3(D)(IV), CANADIAN SWING
LENDER AS A LENDER SHALL NOT MAKE AND SHALL NOT BE OBLIGATED TO MAKE ANY
CANADIAN SWING LOAN IF CANADIAN SWING LENDER HAS ACTUAL KNOWLEDGE THAT (I) ONE
OR MORE OF THE APPLICABLE CONDITIONS PRECEDENT SET FORTH IN SECTION 3.1 OR 3.2
ARE REQUIRED TO, BUT WILL NOT, BE SATISFIED ON THE REQUESTED FUNDING DATE FOR
THE APPLICABLE CANADIAN BORROWING UNLESS SUCH CONDITION HAS BEEN WAIVED IN
ACCORDANCE WITH THE TERMS OF THIS AGREEMENT, OR (II) THE DOLLAR EQUIVALENT OF
THE REQUESTED CANADIAN BORROWING WOULD EXCEED THE DOLLAR EQUIVALENT OF THE
CANADIAN AVAILABILITY ON SUCH FUNDING DATE.  CANADIAN SWING LENDER AS A LENDER
SHALL NOT OTHERWISE BE REQUIRED TO DETERMINE WHETHER THE APPLICABLE CONDITIONS
PRECEDENT SET FORTH IN SECTION 3 HAVE BEEN SATISFIED ON THE FUNDING DATE
APPLICABLE THERETO PRIOR TO MAKING ANY CANADIAN SWING LOAN.  THE CANADIAN SWING
LOANS SHALL BE SECURED BY THE AGENT’S LIENS IN THE COLLATERAL, CONSTITUTE
CANADIAN ADVANCES AND OBLIGATIONS HEREUNDER, AND BEAR INTEREST AT THE RATE
APPLICABLE FROM TIME TO TIME TO CANADIAN ADVANCES THAT ARE BASE RATE LOANS.

 

(III)                               IN THE CASE OF A REQUEST FOR A EUROPEAN
ADVANCE AND SO LONG AS (I) SUCH EUROPEAN ADVANCE IS TO BE DENOMINATED IN DOLLARS
AND (II) EITHER (A) THE AGGREGATE AMOUNT OF EUROPEAN SWING LOANS MADE SINCE THE
LAST SETTLEMENT DATE AND NOT SINCE REPAID PLUS THE DOLLAR EQUIVALENT AMOUNT OF
THE REQUESTED EUROPEAN ADVANCE DOES NOT EXCEED $2,500,000, OR (B) EUROPEAN SWING
LENDER, IN ITS SOLE DISCRETION, SHALL AGREE TO MAKE A EUROPEAN SWING LOAN
NOTWITHSTANDING THE FOREGOING LIMITATION, EUROPEAN SWING LENDER, AS A LENDER,
SHALL MAKE A EUROPEAN ADVANCE IN THE AMOUNT OF SUCH EUROPEAN BORROWING (ANY SUCH
EUROPEAN ADVANCE MADE SOLELY BY EUROPEAN SWING LENDER AS A LENDER PURSUANT TO
THIS SECTION 2.3(B)(III) BEING REFERRED TO AS A “EUROPEAN SWING LOAN” AND SUCH
EUROPEAN ADVANCES BEING REFERRED TO COLLECTIVELY AS “EUROPEAN SWING LOANS”)
AVAILABLE TO EUROPEAN BORROWERS ON THE FUNDING DATE APPLICABLE THERETO BY
TRANSFERRING IMMEDIATELY AVAILABLE FUNDS TO THE APPLICABLE EUROPEAN DESIGNATED
ACCOUNT.  EACH EUROPEAN SWING LOAN SHALL BE DEEMED TO BE A EUROPEAN ADVANCE
HEREUNDER AND SHALL BE SUBJECT TO ALL THE TERMS AND CONDITIONS APPLICABLE TO
OTHER EUROPEAN ADVANCES, EXCEPT THAT ALL PAYMENTS ON ANY EUROPEAN SWING LOAN
SHALL BE PAYABLE TO EUROPEAN SWING LENDER AS A LENDER SOLELY FOR ITS OWN
ACCOUNT.  SUBJECT TO THE PROVISIONS OF SECTION 2.3(D)(IV), EUROPEAN SWING LENDER
AS A LENDER SHALL NOT MAKE AND SHALL NOT BE OBLIGATED TO MAKE ANY EUROPEAN SWING
LOAN IF EUROPEAN SWING LENDER HAS ACTUAL KNOWLEDGE THAT (I) ONE OR MORE OF THE
APPLICABLE CONDITIONS PRECEDENT SET FORTH IN SECTION 3.1 OR 3.2 ARE REQUIRED TO,
BUT WILL NOT, BE SATISFIED ON THE REQUESTED FUNDING DATE FOR THE APPLICABLE
EUROPEAN BORROWING UNLESS SUCH CONDITION HAS BEEN WAIVED IN ACCORDANCE WITH THE
TERMS OF THIS AGREEMENT, OR (II) THE DOLLAR EQUIVALENT OF THE REQUESTED EUROPEAN
BORROWING WOULD EXCEED THE DOLLAR EQUIVALENT OF THE EUROPEAN AVAILABILITY ON
SUCH FUNDING DATE.  EUROPEAN SWING LENDER AS A LENDER SHALL NOT OTHERWISE BE
REQUIRED TO DETERMINE WHETHER THE APPLICABLE CONDITIONS PRECEDENT SET FORTH IN
SECTION 3 HAVE BEEN SATISFIED ON THE FUNDING DATE APPLICABLE THERETO PRIOR TO
MAKING ANY EUROPEAN SWING LOAN.  THE EUROPEAN SWING LOANS SHALL BE SECURED BY
THE AGENT’S LIENS IN THE COLLATERAL, CONSTITUTE EUROPEAN ADVANCES AND
OBLIGATIONS HEREUNDER, AND BEAR INTEREST AT THE RATE APPLICABLE FROM TIME TO
TIME TO EUROPEAN ADVANCES THAT ARE BASE RATE LOANS.

 

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(C)                                  MAKING OF LOANS.

 

(I)                                     IN THE EVENT THAT THE US SWING LENDER IS
NOT OBLIGATED TO MAKE A US SWING LOAN, THEN PROMPTLY AFTER RECEIPT OF A REQUEST
FOR A US BORROWING PURSUANT TO SECTION 2.3(A), (A) IN THE CASE OF BORROWINGS
OTHER THAN OFFSHORE CURRENCY RATE LOANS, ADMINISTRATIVE AGENT SHALL NOTIFY THE
US LENDERS, NOT LATER THAN 1:00 P.M. (CALIFORNIA TIME) ON THE BUSINESS DAY
IMMEDIATELY PRECEDING THE FUNDING DATE APPLICABLE THERETO BY TELECOPY,
TELEPHONE, OR OTHER SIMILAR FORM OF TRANSMISSION, OF THE REQUESTED US BORROWING
(PROVIDED, THAT NOTICE OF A REQUESTED LIBOR RATE LOAN SHALL BE PROVIDED AS SET
FORTH IN SECTION 2.13(B)), AND (B) IN THE CASE OF BORROWINGS CONSISTING OF
OFFSHORE CURRENCY RATE LOANS, ADMINISTRATIVE AGENT SHALL NOTIFY THE US LENDERS,
NOT LATER THAN 1:00 P.M. (CALIFORNIA TIME) AT LEAST 3 BUSINESS DAYS PRIOR TO THE
FUNDING DATE APPLICABLE THERETO BY TELECOPY, TELEPHONE, OR OTHER SIMILAR FORM OF
TRANSMISSION, OF THE REQUESTED US BORROWING.  EACH US LENDER SHALL MAKE THE
AMOUNT OF SUCH US LENDER’S PRO RATA SHARE OF THE REQUESTED US BORROWING
AVAILABLE TO ADMINISTRATIVE AGENT IN IMMEDIATELY AVAILABLE FUNDS AND IN THE
APPLICABLE CURRENCY, TO THE APPLICABLE ADMINISTRATIVE AGENT’S ACCOUNT, NOT LATER
THAN 10:00 A.M. (CALIFORNIA TIME) ON THE FUNDING DATE APPLICABLE THERETO.  AFTER
ADMINISTRATIVE AGENT’S RECEIPT OF THE PROCEEDS OF SUCH US ADVANCES,
ADMINISTRATIVE AGENT SHALL PROMPTLY MAKE THE PROCEEDS THEREOF AVAILABLE TO
ADMINISTRATIVE BORROWER, FOR THE BENEFIT OF THE US BORROWERS, ON THE APPLICABLE
FUNDING DATE BY TRANSFERRING IMMEDIATELY AVAILABLE FUNDS EQUAL TO SUCH PROCEEDS
RECEIVED BY ADMINISTRATIVE AGENT TO THE APPLICABLE US DESIGNATED ACCOUNT;
PROVIDED, HOWEVER, THAT, SUBJECT TO THE PROVISIONS OF SECTION 2.3(D)(IV),
ADMINISTRATIVE AGENT SHALL NOT REQUEST ANY US LENDER TO MAKE, AND NO US LENDER
SHALL HAVE THE OBLIGATION TO MAKE, ANY US ADVANCE IF ADMINISTRATIVE AGENT SHALL
HAVE ACTUAL KNOWLEDGE THAT (1) ONE OR MORE OF THE APPLICABLE CONDITIONS
PRECEDENT SET FORTH IN SECTION 3.1 OR 3.2 ARE REQUIRED TO, BUT WILL NOT, BE
SATISFIED ON THE REQUESTED FUNDING DATE FOR THE APPLICABLE US BORROWING UNLESS
SUCH CONDITION HAS BEEN WAIVED, OR (2) THE DOLLAR EQUIVALENT OF THE REQUESTED US
BORROWING WOULD EXCEED THE US AVAILABILITY ON SUCH FUNDING DATE.

 

(II)                                  IN THE EVENT THAT THE CANADIAN SWING
LENDER IS NOT OBLIGATED TO MAKE A CANADIAN SWING LOAN, THEN PROMPTLY AFTER
RECEIPT OF A REQUEST FOR A CANADIAN BORROWING PURSUANT TO SECTION 2.3(A),
CANADIAN ADMINISTRATIVE AGENT SHALL NOTIFY THE CANADIAN LENDERS, NOT LATER THAN
1:00 P.M. (CALIFORNIA TIME) ON THE BUSINESS DAY IMMEDIATELY PRECEDING THE
FUNDING DATE APPLICABLE THERETO BY TELECOPY, TELEPHONE, OR OTHER SIMILAR FORM OF
TRANSMISSION, OF THE REQUESTED CANADIAN BORROWING (PROVIDED, THAT NOTICE OF A
REQUESTED LIBOR RATE LOAN SHALL BE PROVIDED AS SET FORTH IN SECTION 2.13(B)). 
EACH CANADIAN LENDER SHALL MAKE THE AMOUNT OF SUCH CANADIAN LENDER’S PRO RATA
SHARE OF THE REQUESTED CANADIAN BORROWING AVAILABLE TO CANADIAN ADMINISTRATIVE
AGENT IN IMMEDIATELY AVAILABLE FUNDS AND IN THE APPLICABLE CURRENCY, TO THE
APPLICABLE CANADIAN ADMINISTRATIVE AGENT’S ACCOUNT, NOT LATER THAN 10:00 A.M.
(CALIFORNIA TIME) ON THE FUNDING DATE APPLICABLE THERETO.  AFTER CANADIAN
ADMINISTRATIVE AGENT’S RECEIPT OF THE PROCEEDS OF SUCH CANADIAN ADVANCES,
CANADIAN ADMINISTRATIVE AGENT SHALL PROMPTLY MAKE THE PROCEEDS THEREOF AVAILABLE
TO CANADIAN ADMINISTRATIVE BORROWER, ON THE APPLICABLE FUNDING DATE BY
TRANSFERRING IMMEDIATELY AVAILABLE FUNDS EQUAL TO SUCH PROCEEDS RECEIVED BY
CANADIAN ADMINISTRATIVE AGENT TO THE APPLICABLE CANADIAN DESIGNATED ACCOUNT;
PROVIDED, HOWEVER,

 

9

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THAT, SUBJECT TO THE PROVISIONS OF SECTION 2.3(D)(IV), CANADIAN ADMINISTRATIVE
AGENT SHALL NOT REQUEST ANY CANADIAN LENDER TO MAKE, AND NO CANADIAN LENDER
SHALL HAVE THE OBLIGATION TO MAKE, ANY CANADIAN ADVANCE IF CANADIAN
ADMINISTRATIVE AGENT SHALL HAVE ACTUAL KNOWLEDGE THAT (1) ONE OR MORE OF THE
APPLICABLE CONDITIONS PRECEDENT SET FORTH IN SECTION 3.1 OR 3.2 ARE REQUIRED TO,
BUT WILL NOT, BE SATISFIED ON THE REQUESTED FUNDING DATE FOR THE APPLICABLE
CANADIAN BORROWING UNLESS SUCH CONDITION HAS BEEN WAIVED, OR (2) THE DOLLAR
EQUIVALENT OF THE REQUESTED CANADIAN BORROWING WOULD EXCEED THE DOLLAR
EQUIVALENT OF THE CANADIAN AVAILABILITY ON SUCH FUNDING DATE.

 

(III)                               IN THE EVENT THAT THE EUROPEAN SWING LENDER
IS NOT OBLIGATED TO MAKE A EUROPEAN SWING LOAN, THEN PROMPTLY AFTER RECEIPT OF A
REQUEST FOR A EUROPEAN BORROWING PURSUANT TO SECTION 2.3(A), (A) IN THE CASE OF
BORROWINGS OTHER THAN OFFSHORE CURRENCY RATE LOANS, EUROPEAN ADMINISTRATIVE
AGENT SHALL NOTIFY THE EUROPEAN LENDERS, NOT LATER THAN 1:00 P.M. (CALIFORNIA
TIME) ON THE BUSINESS DAY IMMEDIATELY PRECEDING THE FUNDING DATE APPLICABLE
THERETO BY TELECOPY, TELEPHONE, OR OTHER SIMILAR FORM OF TRANSMISSION, OF THE
REQUESTED EUROPEAN BORROWING (PROVIDED, THAT NOTICE OF A REQUESTED LIBOR RATE
LOAN SHALL BE PROVIDED AS SET FORTH IN SECTION 2.13(B)), AND (B) IN THE CASE OF
BORROWINGS CONSISTING OF OFFSHORE CURRENCY RATE LOANS, EUROPEAN ADMINISTRATIVE
AGENT SHALL NOTIFY THE EUROPEAN LENDERS, NOT LATER 1:00 P.M. (CALIFORNIA TIME)
AT LEAST 3 BUSINESS DAYS PRIOR TO THE FUNDING DATE APPLICABLE THERETO BY
TELECOPY, TELEPHONE, OR OTHER SIMILAR FORM OF TRANSMISSION, OF THE REQUESTED
EUROPEAN BORROWING.  EACH EUROPEAN LENDER SHALL MAKE THE AMOUNT OF SUCH EUROPEAN
LENDER’S PRO RATA SHARE OF THE REQUESTED EUROPEAN BORROWING AVAILABLE TO
EUROPEAN ADMINISTRATIVE AGENT IN IMMEDIATELY AVAILABLE FUNDS AND IN THE
APPLICABLE CURRENCY, TO THE APPLICABLE EUROPEAN ADMINISTRATIVE AGENT’S ACCOUNT,
NOT LATER THAN 10:00 A.M. (CALIFORNIA TIME) ON THE FUNDING DATE APPLICABLE
THERETO.  AFTER EUROPEAN ADMINISTRATIVE AGENT’S RECEIPT OF THE PROCEEDS OF SUCH
ADVANCES, EUROPEAN ADMINISTRATIVE AGENT SHALL PROMPTLY MAKE THE PROCEEDS THEREOF
AVAILABLE TO EUROPEAN ADMINISTRATIVE BORROWER, ON THE APPLICABLE FUNDING DATE BY
TRANSFERRING IMMEDIATELY AVAILABLE FUNDS EQUAL TO SUCH PROCEEDS RECEIVED BY
EUROPEAN ADMINISTRATIVE AGENT TO THE APPLICABLE EUROPEAN DESIGNATED ACCOUNT;
PROVIDED, HOWEVER, THAT, SUBJECT TO THE PROVISIONS OF SECTION 2.3(D)(IV),
EUROPEAN ADMINISTRATIVE AGENT SHALL NOT REQUEST ANY EUROPEAN LENDER TO MAKE, AND
NO EUROPEAN LENDER SHALL HAVE THE OBLIGATION TO MAKE, ANY EUROPEAN ADVANCE IF
EUROPEAN ADMINISTRATIVE AGENT SHALL HAVE ACTUAL KNOWLEDGE THAT (1) ONE OR MORE
OF THE APPLICABLE CONDITIONS PRECEDENT SET FORTH IN SECTION 3.1 OR 3.2 ARE
REQUIRED TO, BUT WILL NOT, BE SATISFIED ON THE REQUESTED FUNDING DATE FOR THE
APPLICABLE EUROPEAN BORROWING UNLESS SUCH CONDITION HAS BEEN WAIVED, OR (2) THE
DOLLAR EQUIVALENT OF THE REQUESTED EUROPEAN BORROWING WOULD EXCEED THE DOLLAR
EQUIVALENT OF THE EUROPEAN AVAILABILITY ON SUCH FUNDING DATE.

 

(IV)                              UNLESS ADMINISTRATIVE AGENT OR EUROPEAN
ADMINISTRATIVE AGENT, AS APPLICABLE, RECEIVES NOTICE FROM A LENDER PRIOR TO
9:00 A.M. (CALIFORNIA TIME) ON THE DATE OF A BORROWING OTHER THAN APPROVED
OFFSHORE RATE LOANS AND PRIOR TO 1:00 P.M. (CALIFORNIA TIME) 3 BUSINESS DAYS
PRIOR TO THE DATE OF A BORROWING CONSISTING OF APPROVED OFFSHORE RATE LOANS,
THAT SUCH LENDER WILL NOT MAKE AVAILABLE AS AND WHEN REQUIRED HEREUNDER TO SUCH
AGENT FOR THE ACCOUNT OF THE US BORROWERS OR THE EUROPEAN BORROWERS, AS

 

10

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THE CASE MAY BE, THE AMOUNT OF THAT LENDER’S PRO RATA SHARE OF THE BORROWING,
SUCH AGENT MAY ASSUME THAT EACH LENDER HAS MADE OR WILL MAKE SUCH AMOUNT
AVAILABLE TO SUCH AGENT IN IMMEDIATELY AVAILABLE FUNDS AND IN THE APPLICABLE
CURRENCY ON THE FUNDING DATE AND SUCH AGENT MAY (BUT SHALL NOT BE SO REQUIRED),
IN RELIANCE UPON SUCH ASSUMPTION, MAKE AVAILABLE ON SUCH DATE, WITH RESPECT TO
ANY US BORROWING, TO THE US BORROWERS OR, WITH RESPECT TO ANY EUROPEAN
BORROWING, TO THE EUROPEAN BORROWERS, A CORRESPONDING AMOUNT.  IF AND TO THE
EXTENT ANY LENDER SHALL NOT HAVE MADE ITS FULL AMOUNT AVAILABLE TO
ADMINISTRATIVE AGENT OR EUROPEAN ADMINISTRATIVE AGENT, AS APPLICABLE, IN
IMMEDIATELY AVAILABLE FUNDS AND SUCH AGENT IN SUCH CIRCUMSTANCES HAS MADE
AVAILABLE TO US BORROWERS OR EUROPEAN BORROWERS, AS THE CASE MAY BE, SUCH
AMOUNT, THAT LENDER SHALL ON THE BUSINESS DAY FOLLOWING SUCH FUNDING DATE MAKE
SUCH AMOUNT AVAILABLE TO SUCH AGENT, TOGETHER WITH INTEREST AT THE DEFAULTING
LENDER RATE FOR EACH DAY DURING SUCH PERIOD.  A NOTICE SUBMITTED BY
ADMINISTRATIVE AGENT OR EUROPEAN ADMINISTRATIVE AGENT, AS APPLICABLE, TO ANY
LENDER WITH RESPECT TO AMOUNTS OWING UNDER THIS SUBSECTION SHALL BE CONCLUSIVE,
ABSENT MANIFEST ERROR.  IF SUCH AMOUNT IS SO MADE AVAILABLE, SUCH PAYMENT TO
ADMINISTRATIVE AGENT OR EUROPEAN ADMINISTRATIVE AGENT, AS APPLICABLE, SHALL
CONSTITUTE SUCH LENDER’S ADVANCE ON THE DATE OF SUCH BORROWING FOR ALL PURPOSES
OF THIS AGREEMENT.  IF SUCH AMOUNT IS NOT MADE AVAILABLE TO ADMINISTRATIVE AGENT
OR EUROPEAN ADMINISTRATIVE AGENT, AS APPLICABLE, ON THE BUSINESS DAY FOLLOWING
THE FUNDING DATE, SUCH AGENT WILL NOTIFY ADMINISTRATIVE BORROWER OF SUCH FAILURE
TO FUND AND, UPON DEMAND BY ADMINISTRATIVE AGENT, WITH RESPECT TO ANY US
BORROWING, US BORROWERS SHALL PAY SUCH AMOUNT TO ADMINISTRATIVE AGENT FOR
ADMINISTRATIVE AGENT’S ACCOUNT, AND, WITH RESPECT TO ANY EUROPEAN BORROWING,
EUROPEAN BORROWERS SHALL PAY SUCH AMOUNT TO EUROPEAN ADMINISTRATIVE AGENT FOR
EUROPEAN ADMINISTRATIVE AGENT’S ACCOUNT, TOGETHER WITH INTEREST THEREON FOR EACH
DAY ELAPSED SINCE THE DATE OF SUCH BORROWING, AT A RATE PER ANNUM EQUAL TO THE
INTEREST RATE APPLICABLE AT THE TIME TO THE ADVANCES COMPRISING SUCH BORROWING. 
UNLESS CANADIAN ADMINISTRATIVE AGENT RECEIVES NOTICE FROM A LENDER PRIOR TO
9:00 A.M. (CALIFORNIA TIME) ON THE DATE OF A BORROWING, THAT SUCH LENDER WILL
NOT MAKE AVAILABLE AS AND WHEN REQUIRED HEREUNDER TO CANADIAN ADMINISTRATIVE
AGENT FOR THE ACCOUNT OF THE CANADIAN BORROWERS THE AMOUNT OF THAT LENDER’S PRO
RATA SHARE OF THE BORROWING, CANADIAN ADMINISTRATIVE AGENT MAY ASSUME THAT EACH
LENDER HAS MADE OR WILL MAKE SUCH AMOUNT AVAILABLE TO CANADIAN ADMINISTRATIVE
AGENT IN IMMEDIATELY AVAILABLE FUNDS AND IN THE APPLICABLE CURRENCY ON THE
FUNDING DATE AND CANADIAN ADMINISTRATIVE AGENT MAY (BUT SHALL NOT BE SO
REQUIRED), IN RELIANCE UPON SUCH ASSUMPTION, MAKE AVAILABLE ON SUCH DATE, WITH
RESPECT TO ANY CANADIAN BORROWING, TO THE CANADIAN BORROWERS, A CORRESPONDING
AMOUNT.  IF AND TO THE EXTENT ANY CANADIAN LENDER SHALL NOT HAVE MADE ITS FULL
AMOUNT AVAILABLE TO CANADIAN ADMINISTRATIVE AGENT IN IMMEDIATELY AVAILABLE FUNDS
AND CANADIAN ADMINISTRATIVE AGENT IN SUCH CIRCUMSTANCES HAS MADE AVAILABLE TO
CANADIAN BORROWERS SUCH AMOUNT, THAT LENDER SHALL ON THE BUSINESS DAY FOLLOWING
SUCH FUNDING DATE MAKE SUCH AMOUNT AVAILABLE TO CANADIAN ADMINISTRATIVE AGENT,
TOGETHER WITH INTEREST AT THE DEFAULTING LENDER RATE FOR EACH DAY DURING SUCH
PERIOD.  A NOTICE SUBMITTED BY CANADIAN ADMINISTRATIVE AGENT TO ANY CANADIAN
LENDER WITH RESPECT TO AMOUNTS OWING UNDER THIS SUBSECTION SHALL BE CONCLUSIVE,
ABSENT MANIFEST ERROR.  IF SUCH AMOUNT IS SO MADE AVAILABLE, SUCH PAYMENT TO
CANADIAN ADMINISTRATIVE AGENT SHALL CONSTITUTE SUCH CANADIAN LENDER’S ADVANCE ON
THE DATE OF SUCH BORROWING FOR ALL PURPOSES OF THIS AGREEMENT.  IF SUCH AMOUNT
IS NOT MADE AVAILABLE TO CANADIAN ADMINISTRATIVE AGENT ON THE BUSINESS DAY
FOLLOWING THE FUNDING DATE, SUCH

 

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AGENT WILL NOTIFY ADMINISTRATIVE BORROWER OF SUCH FAILURE TO FUND AND, UPON
DEMAND BY CANADIAN ADMINISTRATIVE AGENT, WITH RESPECT TO ANY CANADIAN BORROWING,
CANADIAN BORROWERS SHALL PAY SUCH AMOUNT TO CANADIAN ADMINISTRATIVE AGENT FOR
CANADIAN ADMINISTRATIVE AGENT’S ACCOUNT, TOGETHER WITH INTEREST THEREON FOR EACH
DAY ELAPSED SINCE THE DATE OF SUCH BORROWING, AT A RATE PER ANNUM EQUAL TO THE
INTEREST RATE APPLICABLE AT THE TIME TO THE ADVANCES COMPRISING SUCH BORROWING. 
THE FAILURE OF ANY LENDER TO MAKE ANY ADVANCE ON ANY FUNDING DATE SHALL NOT
RELIEVE ANY OTHER LENDER OF ANY OBLIGATION HEREUNDER TO MAKE AN ADVANCE ON SUCH
FUNDING DATE, BUT NO LENDER SHALL BE RESPONSIBLE FOR THE FAILURE OF ANY OTHER
LENDER TO MAKE THE ADVANCE TO BE MADE BY SUCH OTHER LENDER ON ANY FUNDING DATE.

 

(V)                                 NO AGENT SHALL BE OBLIGATED TO TRANSFER TO A
DEFAULTING LENDER ANY PAYMENTS MADE BY US BORROWERS, CANADIAN BORROWERS OR
EUROPEAN BORROWERS, AS THE CASE MAY BE, TO SUCH AGENT FOR THE DEFAULTING
LENDER’S BENEFIT, AND, IN THE ABSENCE OF SUCH TRANSFER TO THE DEFAULTING LENDER,
SUCH AGENT SHALL TRANSFER ANY SUCH PAYMENTS TO EACH OTHER NON-DEFAULTING LENDER
MEMBER OF THE LENDER GROUP RATABLY IN ACCORDANCE WITH THEIR COMMITMENTS (BUT
ONLY TO THE EXTENT THAT SUCH DEFAULTING LENDER’S ADVANCE WAS FUNDED BY THE OTHER
MEMBERS OF THE LENDER GROUP) OR, IF SO DIRECTED BY ADMINISTRATIVE BORROWER AND
IF NO DEFAULT OR EVENT OF DEFAULT HAD OCCURRED AND IS CONTINUING (AND TO THE
EXTENT SUCH DEFAULTING LENDER’S ADVANCE WAS NOT FUNDED BY THE LENDER GROUP),
SUCH AGENT SHALL RETAIN SAME TO BE RE-ADVANCED TO THE APPLICABLE BORROWERS AS IF
SUCH DEFAULTING LENDER HAD MADE ADVANCES TO SUCH BORROWERS.  SUBJECT TO THE
FOREGOING, ADMINISTRATIVE AGENT, CANADIAN ADMINISTRATIVE AGENT OR EUROPEAN
ADMINISTRATIVE AGENT, AS APPLICABLE, MAY HOLD AND, IN ITS PERMITTED DISCRETION,
RE-LEND TO THE APPLICABLE BORROWERS FOR THE ACCOUNT OF SUCH DEFAULTING LENDER
THE AMOUNT OF ALL SUCH PAYMENTS RECEIVED AND RETAINED BY SUCH AGENT FOR THE
ACCOUNT OF SUCH DEFAULTING LENDER.  SOLELY FOR THE PURPOSES OF VOTING OR
CONSENTING TO MATTERS WITH RESPECT TO THE LOAN DOCUMENTS, SUCH DEFAULTING LENDER
SHALL BE DEEMED NOT TO BE A “LENDER” AND SUCH LENDER’S COMMITMENT SHALL BE
DEEMED TO BE ZERO.  THIS SECTION SHALL REMAIN EFFECTIVE WITH RESPECT TO SUCH
LENDER UNTIL (X) THE OBLIGATIONS UNDER THIS AGREEMENT SHALL HAVE BEEN DECLARED
OR SHALL HAVE BECOME IMMEDIATELY DUE AND PAYABLE, (Y) THE NON-DEFAULTING
LENDERS, ADMINISTRATIVE AGENT, CANADIAN ADMINISTRATIVE AGENT OR EUROPEAN
ADMINISTRATIVE AGENT, AS APPLICABLE, AND ADMINISTRATIVE BORROWER SHALL HAVE
WAIVED SUCH DEFAULTING LENDER’S DEFAULT IN WRITING, OR (Z) THE DEFAULTING LENDER
MAKES ITS PRO RATA SHARE OF THE APPLICABLE ADVANCE AND PAYS TO ADMINISTRATIVE
AGENT, CANADIAN ADMINISTRATIVE AGENT OR EUROPEAN ADMINISTRATIVE AGENT, AS
APPLICABLE, ALL AMOUNTS OWING BY DEFAULTING LENDER IN RESPECT THEREOF.  THE
OPERATION OF THIS SECTION SHALL NOT BE CONSTRUED TO INCREASE OR OTHERWISE AFFECT
THE COMMITMENT OF ANY LENDER, TO RELIEVE OR EXCUSE THE PERFORMANCE BY SUCH
DEFAULTING LENDER OR ANY OTHER LENDER OF ITS DUTIES AND OBLIGATIONS HEREUNDER,
OR TO RELIEVE OR EXCUSE THE PERFORMANCE BY BORROWERS OF THEIR DUTIES AND
OBLIGATIONS HEREUNDER TO AGENTS OR TO THE LENDERS OTHER THAN SUCH DEFAULTING
LENDER.  ANY SUCH FAILURE TO FUND BY ANY DEFAULTING LENDER SHALL CONSTITUTE A
MATERIAL BREACH BY SUCH DEFAULTING LENDER OF THIS AGREEMENT AND SHALL ENTITLE
ADMINISTRATIVE BORROWER AT ITS OPTION, UPON WRITTEN NOTICE TO ADMINISTRATIVE
AGENT, TO ARRANGE FOR A SUBSTITUTE LENDER TO ASSUME THE ADVANCES AND COMMITMENT
OF SUCH DEFAULTING LENDER, SUCH SUBSTITUTE LENDER TO BE ACCEPTABLE TO
ADMINISTRATIVE AGENT.  IN CONNECTION WITH THE ARRANGEMENT OF SUCH A SUBSTITUTE
LENDER, THE DEFAULTING LENDER SHALL HAVE NO RIGHT TO REFUSE TO BE REPLACED
HEREUNDER, AND AGREES TO

 

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EXECUTE AND DELIVER A COMPLETED FORM OF ASSIGNMENT AND ACCEPTANCE IN FAVOR OF
THE SUBSTITUTE LENDER (AND AGREES THAT IT SHALL BE DEEMED TO HAVE EXECUTED AND
DELIVERED SUCH DOCUMENT IF IT FAILS TO DO SO) SUBJECT ONLY TO BEING REPAID ITS
SHARE OF THE OUTSTANDING OBLIGATIONS (OTHER THAN BANK PRODUCT OBLIGATIONS, BUT
INCLUDING AN ASSUMPTION OF ITS PRO RATA SHARE OF THE RISK PARTICIPATION
LIABILITY) WITHOUT ANY PREMIUM OR PENALTY OF ANY KIND WHATSOEVER; PROVIDED
HOWEVER, THAT ANY SUCH ASSUMPTION OF THE COMMITMENT OF SUCH DEFAULTING LENDER
SHALL NOT BE DEEMED TO CONSTITUTE A WAIVER OF ANY OF THE LENDER GROUPS’ OR
BORROWERS’ RIGHTS OR REMEDIES AGAINST ANY SUCH DEFAULTING LENDER ARISING OUT OF
OR IN RELATION TO SUCH FAILURE TO FUND.

 

(D)                                 PROTECTIVE ADVANCES AND OPTIONAL
OVERADVANCES.

 

(I)                                     ADMINISTRATIVE AGENT HEREBY IS
AUTHORIZED BY BORROWERS AND THE LENDERS, FROM TIME TO TIME IN ADMINISTRATIVE
AGENT’S SOLE DISCRETION, (A) AFTER THE OCCURRENCE AND DURING THE CONTINUANCE OF
A DEFAULT OR AN EVENT OF DEFAULT, OR (B) AT ANY TIME THAT ANY OF THE OTHER
APPLICABLE CONDITIONS PRECEDENT SET FORTH IN SECTION 3 ARE NOT SATISFIED, TO
MAKE US ADVANCES TO US BORROWERS ON BEHALF OF THE US LENDERS THAT ADMINISTRATIVE
AGENT, IN ITS PERMITTED DISCRETION, DEEMS NECESSARY OR DESIRABLE (1) TO PRESERVE
OR PROTECT THE COLLATERAL, OR ANY PORTION THEREOF, (2) TO ENHANCE THE LIKELIHOOD
OF REPAYMENT OF THE OBLIGATIONS (OTHER THAN THE BANK PRODUCT OBLIGATIONS), OR
(3) TO PAY ANY OTHER AMOUNT CHARGEABLE TO US BORROWERS PURSUANT TO THE TERMS OF
THIS AGREEMENT, INCLUDING LENDER GROUP EXPENSES AND THE COSTS, FEES, AND
EXPENSES DESCRIBED IN SECTION 10 (ANY OF THE ADVANCES DESCRIBED IN THIS
SECTION 2.3(D)(I) SHALL BE REFERRED TO AS “US PROTECTIVE ADVANCES”); PROVIDED,
THAT THE AGGREGATE DOLLAR EQUIVALENT OF THE PRINCIPAL AMOUNT OF US PROTECTIVE
ADVANCES MADE PURSUANT TO THIS SECTION 2.3(D)(I), WHEN TAKEN TOGETHER WITH THE
DOLLAR EQUIVALENT OF THE OUTSTANDING PRINCIPAL AMOUNT OF OVERADVANCES MADE
PURSUANT TO SECTION 2.3(D)(IV), CANADIAN PROTECTIVE ADVANCES MADE PURSUANT TO
SECTION 2.3(D)(II) AND EUROPEAN PROTECTIVE ADVANCES MADE PURSUANT TO
SECTION 2.3(D)(III), SHALL NOT EXCEED AT ANY TIME AN AMOUNT EQUAL TO THE LESSER
OF (X) 10% OF THE FOREIGN BORROWING BASE (WITHOUT GIVING EFFECT TO CLAUSE (C) OF
THE DEFINITION THEREOF) THEN IN EFFECT AND (Y)  $7,500,000.

 

(II)                                  CANADIAN ADMINISTRATIVE AGENT HEREBY IS
AUTHORIZED BY BORROWERS AND THE LENDERS, FROM TIME TO TIME IN CANADIAN
ADMINISTRATIVE AGENT’S SOLE DISCRETION, (A) AFTER THE OCCURRENCE AND DURING THE
CONTINUANCE OF A DEFAULT OR AN EVENT OF DEFAULT, OR (B) AT ANY TIME THAT ANY OF
THE OTHER APPLICABLE CONDITIONS PRECEDENT SET FORTH IN SECTION 3 ARE NOT
SATISFIED, TO MAKE CANADIAN ADVANCES TO CANADIAN BORROWERS ON BEHALF OF THE
CANADIAN LENDERS THAT CANADIAN ADMINISTRATIVE AGENT, IN ITS PERMITTED
DISCRETION, DEEMS NECESSARY OR DESIRABLE (1) TO PRESERVE OR PROTECT THE
COLLATERAL, OR ANY PORTION THEREOF, (2) TO ENHANCE THE LIKELIHOOD OF REPAYMENT
OF THE OBLIGATIONS (OTHER THAN THE BANK PRODUCT OBLIGATIONS), OR (3) TO PAY ANY
OTHER AMOUNT CHARGEABLE TO CANADIAN BORROWERS PURSUANT TO THE TERMS OF THIS
AGREEMENT, INCLUDING LENDER GROUP EXPENSES AND THE COSTS, FEES, AND EXPENSES
DESCRIBED IN SECTION 10 (ANY OF THE CANADIAN ADVANCES DESCRIBED IN THIS
SECTION 2.3(D)(II) SHALL BE REFERRED TO AS “CANADIAN PROTECTIVE ADVANCES”);
PROVIDED, THAT THE AGGREGATE DOLLAR EQUIVALENT OF THE PRINCIPAL AMOUNT OF
CANADIAN PROTECTIVE ADVANCES MADE PURSUANT TO THIS SECTION 2.3(D)(II), WHEN
TAKEN TOGETHER WITH THE DOLLAR EQUIVALENT OF THE OUTSTANDING PRINCIPAL AMOUNT OF
OVERADVANCES MADE PURSUANT TO SECTION 2.3(D)(IV), US

 

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PROTECTIVE ADVANCES MADE PURSUANT TO SECTION 2.3(D)(I) AND EUROPEAN PROTECTIVE
ADVANCES MADE PURSUANT TO SECTION 2.3(D)(III), SHALL NOT EXCEED AT ANY TIME AN
AMOUNT EQUAL TO THE LESSER OF (X) 10% OF THE FOREIGN BORROWING BASE (WITHOUT
GIVING EFFECT TO CLAUSE (C) OF THE DEFINITION THEREOF) THEN IN EFFECT AND
(Y) $7,500,000.

 

(III)                               EUROPEAN ADMINISTRATIVE AGENT HEREBY IS
AUTHORIZED BY BORROWERS AND THE LENDERS, FROM TIME TO TIME IN EUROPEAN
ADMINISTRATIVE AGENT’S SOLE DISCRETION, (A) AFTER THE OCCURRENCE AND DURING THE
CONTINUANCE OF A DEFAULT OR AN EVENT OF DEFAULT, OR (B) AT ANY TIME THAT ANY OF
THE OTHER APPLICABLE CONDITIONS PRECEDENT SET FORTH IN SECTION 3 ARE NOT
SATISFIED, TO MAKE EUROPEAN ADVANCES TO EUROPEAN BORROWERS ON BEHALF OF THE
EUROPEAN LENDERS THAT EUROPEAN ADMINISTRATIVE AGENT, IN ITS PERMITTED
DISCRETION, DEEMS NECESSARY OR DESIRABLE (1) TO PRESERVE OR PROTECT THE
COLLATERAL, OR ANY PORTION THEREOF, (2) TO ENHANCE THE LIKELIHOOD OF REPAYMENT
OF THE OBLIGATIONS (OTHER THAN THE BANK PRODUCT OBLIGATIONS), OR (3) TO PAY ANY
OTHER AMOUNT CHARGEABLE TO EUROPEAN BORROWERS PURSUANT TO THE TERMS OF THIS
AGREEMENT, INCLUDING LENDER GROUP EXPENSES AND THE COSTS, FEES, AND EXPENSES
DESCRIBED IN SECTION 10 (ANY OF THE EUROPEAN ADVANCES DESCRIBED IN THIS
SECTION 2.3(D)(III) SHALL BE REFERRED TO AS “EUROPEAN PROTECTIVE ADVANCES”);
PROVIDED, THAT THE AGGREGATE DOLLAR EQUIVALENT OF THE PRINCIPAL AMOUNT OF
EUROPEAN PROTECTIVE ADVANCES MADE PURSUANT TO THIS SECTION 2.3(D)(II), WHEN
TAKEN TOGETHER WITH THE DOLLAR EQUIVALENT OF THE OUTSTANDING PRINCIPAL AMOUNT OF
OVERADVANCES MADE PURSUANT TO SECTION 2.3(D)(IV), US PROTECTIVE ADVANCES MADE
PURSUANT TO SECTION 2.3(D)(I) AND CANADIAN PROTECTIVE ADVANCES MADE PURSUANT TO
SECTION 2.3(D)(II), SHALL NOT EXCEED AT ANY TIME AN AMOUNT EQUAL TO THE LESSER
OF (X) 10% OF THE FOREIGN BORROWING BASE (WITHOUT GIVING EFFECT TO CLAUSE (C) OF
THE DEFINITION THEREOF) THEN IN EFFECT AND (Y) $7,500,000.

 

(IV)                              ANY CONTRARY PROVISION OF THIS AGREEMENT
NOTWITHSTANDING, THE LENDERS HEREBY AUTHORIZE ADMINISTRATIVE AGENT, CANADIAN
ADMINISTRATIVE AGENT, EUROPEAN ADMINISTRATIVE AGENT, FRONTING LENDER, US SWING
LENDER, CANADIAN SWING LENDER, OR EUROPEAN SWING LENDER, AS APPLICABLE, AND
ADMINISTRATIVE AGENT, CANADIAN ADMINISTRATIVE AGENT, EUROPEAN ADMINISTRATIVE
AGENT, FRONTING LENDER, US SWING LENDER, CANADIAN SWING LENDER, OR EUROPEAN
SWING LENDER, AS APPLICABLE, MAY, BUT IS NOT OBLIGATED TO, KNOWINGLY AND
INTENTIONALLY, CONTINUE TO MAKE ADVANCES (INCLUDING SWING LOANS) TO BORROWERS
NOTWITHSTANDING THAT AN OVERADVANCE EXISTS OR THEREBY WOULD BE CREATED, SO LONG
AS (A) AFTER GIVING EFFECT TO SUCH ADVANCES, (1) THE OUTSTANDING US REVOLVER
USAGE DOES NOT EXCEED THE US BORROWING BASE BY MORE THAN $7,500,000 AND (2) THE
OUTSTANDING REVOLVER USAGE DOES NOT EXCEED THE FOREIGN BORROWING BASE (WITHOUT
GIVING EFFECT TO CLAUSE (C) OF THE DEFINITION THEREOF) BY MORE THAN THE LESSER
OF (X) 10% OF THE FOREIGN BORROWING BASE (WITHOUT GIVING EFFECT TO CLAUSE (C) OF
THE DEFINITION THEREOF) THEN IN EFFECT AND (Y) $7,500,000, (B) AFTER GIVING
EFFECT TO SUCH ADVANCES, THE OUTSTANDING REVOLVER USAGE (EXCEPT FOR AND
EXCLUDING AMOUNTS CHARGED TO THE LOAN ACCOUNTS FOR INTEREST, FEES, OR LENDER
GROUP EXPENSES) DOES NOT EXCEED THE AMOUNT EQUAL TO THE MAXIMUM REVOLVER AMOUNT
LESS THE AVAILABILITY RESERVE, (C) THE AGGREGATE DOLLAR EQUIVALENT OF THE
PRINCIPAL AMOUNT OF OVERADVANCES MADE PURSUANT TO THIS SECTION 2.3(D)(IV), WHEN
TAKEN TOGETHER WITH THE DOLLAR EQUIVALENT OF THE OUTSTANDING PRINCIPAL AMOUNT OF
PROTECTIVE ADVANCES MADE PURSUANT TO SECTIONS 2.3(D)(I), (II) AND (III), DOES
NOT EXCEED AT ANY TIME AN AMOUNT EQUAL TO THE LESSER OF

 

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(X) 10% OF THE FOREIGN BORROWING BASE (WITHOUT GIVING EFFECT TO CLAUSE (C) OF
THE DEFINITION THEREOF) THEN IN EFFECT AND (Y) $7,500,000 AND (D) AT THE TIME OF
THE MAKING OF SUCH ADVANCE, SUCH AGENT DOES NOT BELIEVE, IN GOOD FAITH, THAT THE
OVERADVANCE CREATED BY SUCH ADVANCE WILL BE OUTSTANDING FOR MORE THAN 90 DAYS. 
IN THE EVENT ADMINISTRATIVE AGENT, CANADIAN ADMINISTRATIVE AGENT OR EUROPEAN
ADMINISTRATIVE AGENT OBTAINS ACTUAL KNOWLEDGE THAT THE REVOLVER USAGE EXCEEDS
THE AMOUNTS PERMITTED BY THE IMMEDIATELY FOREGOING PROVISIONS, REGARDLESS OF THE
AMOUNT OF, OR REASON FOR, SUCH EXCESS, ADMINISTRATIVE AGENT SHALL NOTIFY THE
LENDERS AS SOON AS PRACTICABLE (AND PRIOR TO MAKING ANY (OR ANY ADDITIONAL)
INTENTIONAL OVERADVANCES (EXCEPT FOR AND EXCLUDING AMOUNTS CHARGED TO THE LOAN
ACCOUNTS FOR INTEREST, FEES, OR LENDER GROUP EXPENSES) UNLESS SUCH AGENT
DETERMINES THAT PRIOR NOTICE WOULD RESULT IN IMMINENT HARM TO THE COLLATERAL OR
ITS VALUE), AND THE LENDERS WITH REVOLVER COMMITMENTS THEREUPON SHALL, TOGETHER
WITH SUCH AGENT, JOINTLY DETERMINE THE TERMS OF ARRANGEMENTS THAT SHALL BE
IMPLEMENTED WITH BORROWERS INTENDED TO REDUCE, WITHIN A REASONABLE TIME, THE
OUTSTANDING PRINCIPAL AMOUNT OF THE ADVANCES TO BORROWERS TO AN AMOUNT PERMITTED
BY THE FOREGOING PROVISIONS.  IN SUCH CIRCUMSTANCES, IF ANY LENDER DISAGREES
WITH THE PROPOSED TERMS OF REDUCTION OR REPAYMENT OF ANY OVERADVANCE, THE TERMS
OF REDUCTION OR REPAYMENT THEREOF SHALL BE IMPLEMENTED ACCORDING TO THE
DETERMINATION OF THE REQUIRED LENDERS.  EACH LENDER WITH A REVOLVER COMMITMENT
SHALL BE OBLIGATED TO SETTLE WITH ADMINISTRATIVE AGENT, CANADIAN ADMINISTRATIVE
AGENT OR EUROPEAN ADMINISTRATIVE AGENT, AS APPLICABLE, AS PROVIDED IN
SECTION 2.3(E) FOR THE AMOUNT OF SUCH LENDER’S PRO RATA SHARE OF ANY
UNINTENTIONAL OVERADVANCES BY SUCH AGENT REPORTED TO SUCH LENDER, ANY
INTENTIONAL OVERADVANCES MADE AS PERMITTED UNDER THIS SECTION 2.3(D)(IV), AND
ANY OVERADVANCES RESULTING FROM THE CHARGING TO A LOAN ACCOUNT OF INTEREST,
FEES, OR LENDER GROUP EXPENSES.

 

(V)                                 EACH PROTECTIVE ADVANCE AND EACH OVERADVANCE
SHALL BE DEEMED TO BE AN ADVANCE HEREUNDER, EXCEPT THAT NO PROTECTIVE ADVANCE OR
OVERADVANCE SHALL BE ELIGIBLE TO BE A LIBOR RATE LOAN AND ALL PAYMENTS ON THE US
PROTECTIVE ADVANCES AND EUROPEAN PROTECTIVE ADVANCES SHALL BE PAYABLE TO
ADMINISTRATIVE AGENT OR EUROPEAN ADMINISTRATIVE AGENT, AS THE CASE MAY BE,
SOLELY FOR ITS OWN ACCOUNT (TO THE EXTENT SUCH ADVANCES HAVE NOT BEEN SETTLED
WITH LENDERS PURSUANT TO CLAUSE (E) OF THIS SECTION) AND ALL PAYMENTS ON THE
CANADIAN PROTECTIVE ADVANCES SHALL BE PAYABLE TO CANADIAN ADMINISTRATIVE AGENT
SOLELY FOR ITS OWN ACCOUNT (TO THE EXTENT SUCH ADVANCES HAVE NOT BEEN SETTLED
WITH LENDERS PURSUANT TO CLAUSE (E) OF THIS SECTION).  THE PROTECTIVE ADVANCES
AND OVERADVANCES SHALL BE REPAYABLE ON DEMAND, SECURED BY THE AGENT’S LIENS
(PROVIDED THAT PROTECTIVE ADVANCES AND OVERADVANCES TO US BORROWERS SHALL ONLY
BE SECURED BY THE US COLLATERAL), AND SHALL CONSTITUTE OBLIGATIONS HEREUNDER. 
PROTECTIVE ADVANCES AND OVERADVANCES DENOMINATED IN DOLLARS SHALL BEAR INTEREST
AT THE RATE APPLICABLE FROM TIME TO TIME TO ADVANCES THAT ARE BASE RATE LOANS
DENOMINATED IN DOLLARS, PROTECTIVE ADVANCES AND OVERADVANCES DENOMINATED IN AN
APPROVED OFFSHORE CURRENCY SHALL BEAR INTEREST AT THE RATE APPLICABLE FROM TIME
TO TIME TO ADVANCES THAT ARE LIBOR RATE LOANS DENOMINATED IN SUCH APPROVED
OFFSHORE CURRENCY WITH AN INTEREST PERIOD OF ONE MONTH’S DURATION AND CANADIAN
PROTECTIVE ADVANCES AND CANADIAN OVERADVANCES DENOMINATED IN CANADIAN DOLLARS
SHALL BEAR INTEREST AT THE RATE APPLICABLE FROM TIME TO TIME TO CANADIAN
ADVANCES THAT ARE BASE RATE LOANS DENOMINATED IN CANADIAN DOLLARS.  THE
PROVISIONS OF THIS SECTION 2.3(D) ARE FOR

 

15

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THE EXCLUSIVE BENEFIT OF AGENTS, FRONTING LENDER, SWING LENDERS, AND THE LENDERS
AND ARE NOT INTENDED TO BENEFIT ANY BORROWER IN ANY WAY.

 

(E)                                  SETTLEMENT.  IT IS AGREED, SUBJECT TO THE
LAST SENTENCE OF SECTION 2.1(A), THAT EACH LENDER’S FUNDED PORTION OF THE
ADVANCES IS INTENDED BY THE LENDERS TO EQUAL, AT ALL TIMES, SUCH LENDER’S PRO
RATA SHARE OF THE OUTSTANDING ADVANCES.  SUCH AGREEMENT NOTWITHSTANDING, AGENTS,
FRONTING LENDER, SWING LENDERS, AND THE OTHER LENDERS AGREE (WHICH AGREEMENT
SHALL NOT BE FOR THE BENEFIT OF ANY BORROWER) THAT IN ORDER TO FACILITATE THE
ADMINISTRATION OF THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS, SETTLEMENT AMONG
THE LENDERS AS TO THE ADVANCES, THE SWING LOANS, AND THE PROTECTIVE ADVANCES
SHALL TAKE PLACE ON A PERIODIC BASIS IN ACCORDANCE WITH THE FOLLOWING
PROVISIONS:

 

(I)                                     ADMINISTRATIVE AGENT, CANADIAN
ADMINISTRATIVE AGENT OR EUROPEAN ADMINISTRATIVE AGENT, AS APPLICABLE, SHALL
REQUEST SETTLEMENT (“SETTLEMENT”) WITH THE LENDERS ON A WEEKLY BASIS, OR ON A
MORE FREQUENT BASIS IF SO DETERMINED BY SUCH AGENT, (1) ON BEHALF OF US SWING
LENDER, WITH RESPECT TO EACH OUTSTANDING US SWING LOAN, (2) ON BEHALF OF
CANADIAN SWING LENDER, WITH RESPECT TO EACH OUTSTANDING CANADIAN SWING LOAN,
(3) ON BEHALF OF EUROPEAN SWING LENDER, WITH RESPECT TO EACH OUTSTANDING
EUROPEAN SWING LOAN, (4) FOR ITSELF, WITH RESPECT TO THE OUTSTANDING PROTECTIVE
ADVANCES, AND (5) WITH RESPECT TO LOAN PARTIES’ COLLECTIONS RECEIVED, AS TO EACH
BY NOTIFYING THE LENDERS BY TELECOPY, TELEPHONE, OR OTHER SIMILAR FORM OF
TRANSMISSION, OF SUCH REQUESTED SETTLEMENT, NO LATER THAN 2:00 P.M. (CALIFORNIA
TIME) ON THE BUSINESS DAY IMMEDIATELY PRIOR TO THE DATE OF SUCH REQUESTED
SETTLEMENT (THE DATE OF SUCH REQUESTED SETTLEMENT BEING THE “SETTLEMENT DATE”). 
SUCH NOTICE OF A SETTLEMENT DATE SHALL INCLUDE A SUMMARY STATEMENT OF THE AMOUNT
OF OUTSTANDING ADVANCES, SWING LOANS, AND PROTECTIVE ADVANCES FOR THE PERIOD
SINCE THE PRIOR SETTLEMENT DATE.  SUBJECT TO THE TERMS AND CONDITIONS CONTAINED
HEREIN (INCLUDING SECTION 2.3(C)(V)):  (U) IF A LENDER’S BALANCE OF THE US
ADVANCES (INCLUDING US SWING LOANS AND US PROTECTIVE ADVANCES) EXCEEDS SUCH
LENDER’S PRO RATA SHARE OF THE US ADVANCES (INCLUDING US SWING LOANS AND US
PROTECTIVE ADVANCES) AS OF A SETTLEMENT DATE, THEN ADMINISTRATIVE AGENT SHALL,
BY NO LATER THAN 12:00 P.M. (CALIFORNIA TIME) ON THE SETTLEMENT DATE, TRANSFER
IN IMMEDIATELY AVAILABLE FUNDS TO A DEPOSIT ACCOUNT OF SUCH LENDER (AS SUCH
LENDER MAY DESIGNATE), AN AMOUNT IN THE APPLICABLE CURRENCY SUCH THAT EACH SUCH
LENDER SHALL, UPON RECEIPT OF SUCH AMOUNT, HAVE AS OF THE SETTLEMENT DATE, ITS
PRO RATA SHARE OF THE US ADVANCES (INCLUDING US SWING LOANS AND US PROTECTIVE
ADVANCES), (V) IF A LENDER’S BALANCE OF THE EUROPEAN ADVANCES (INCLUDING
EUROPEAN SWING LOANS AND EUROPEAN PROTECTIVE ADVANCES) EXCEEDS SUCH LENDER’S PRO
RATA SHARE OF THE EUROPEAN ADVANCES (INCLUDING EUROPEAN SWING LOANS AND EUROPEAN
PROTECTIVE ADVANCES) AS OF A SETTLEMENT DATE, THEN EUROPEAN ADMINISTRATIVE AGENT
SHALL, BY NO LATER THAN 12:00 P.M. (CALIFORNIA TIME) ON THE SETTLEMENT DATE,
TRANSFER IN IMMEDIATELY AVAILABLE FUNDS TO A DEPOSIT ACCOUNT OF SUCH LENDER (AS
SUCH LENDER MAY DESIGNATE), AN AMOUNT IN THE APPLICABLE CURRENCY SUCH THAT EACH
SUCH LENDER SHALL, UPON RECEIPT OF SUCH AMOUNT, HAVE AS OF THE SETTLEMENT DATE,
ITS PRO RATA SHARE OF THE EUROPEAN ADVANCES (INCLUDING EUROPEAN SWING LOANS AND
EUROPEAN PROTECTIVE ADVANCES), (W) IF A CANADIAN LENDER’S BALANCE OF THE
CANADIAN ADVANCES (INCLUDING CANADIAN SWING LOANS AND CANADIAN PROTECTIVE
ADVANCES) EXCEEDS SUCH CANADIAN LENDER’S PRO RATA SHARE OF THE CANADIAN ADVANCES
(INCLUDING CANADIAN SWING

 

16

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LOANS AND CANADIAN PROTECTIVE ADVANCES) AS OF A SETTLEMENT DATE, THEN CANADIAN
ADMINISTRATIVE AGENT SHALL, BY NO LATER THAN 12:00 P.M. (CALIFORNIA TIME) ON THE
SETTLEMENT DATE, TRANSFER IN IMMEDIATELY AVAILABLE FUNDS TO A DEPOSIT ACCOUNT OF
SUCH CANADIAN LENDER (AS SUCH LENDER MAY DESIGNATE), AN AMOUNT IN THE APPLICABLE
CURRENCY SUCH THAT EACH SUCH LENDER SHALL, UPON RECEIPT OF SUCH AMOUNT, HAVE AS
OF THE SETTLEMENT DATE, ITS PRO RATA SHARE OF THE CANADIAN ADVANCES (INCLUDING
CANADIAN SWING LOANS AND CANADIAN PROTECTIVE ADVANCES), (X) IF A LENDER’S
BALANCE OF THE US ADVANCES (INCLUDING US SWING LOANS AND US PROTECTIVE ADVANCES)
IS LESS THAN SUCH LENDER’S PRO RATA SHARE OF THE US ADVANCES (INCLUDING US SWING
LOANS AND US PROTECTIVE ADVANCES) AS OF A SETTLEMENT DATE, SUCH LENDER SHALL NO
LATER THAN 12:00 P.M. (CALIFORNIA TIME) ON THE SETTLEMENT DATE TRANSFER IN
IMMEDIATELY AVAILABLE FUNDS TO THE APPLICABLE ADMINISTRATIVE AGENT’S ACCOUNT, AN
AMOUNT IN THE APPLICABLE CURRENCY SUCH THAT EACH SUCH LENDER SHALL, UPON
TRANSFER OF SUCH AMOUNT, HAVE AS OF THE SETTLEMENT DATE, ITS PRO RATA SHARE OF
THE US ADVANCES (INCLUDING US SWING LOANS AND US PROTECTIVE ADVANCES), (Y) IF A
CANADIAN LENDER’S BALANCE OF THE CANADIAN ADVANCES (INCLUDING CANADIAN SWING
LOANS AND CANADIAN PROTECTIVE ADVANCES) IS LESS THAN SUCH LENDER’S PRO RATA
SHARE OF THE CANADIAN ADVANCES (INCLUDING CANADIAN SWING LOANS AND CANADIAN
PROTECTIVE ADVANCES) AS OF A SETTLEMENT DATE, SUCH CANADIAN LENDER SHALL NO
LATER THAN 12:00 P.M. (CALIFORNIA TIME) ON THE SETTLEMENT DATE TRANSFER IN
IMMEDIATELY AVAILABLE FUNDS TO THE APPLICABLE CANADIAN ADMINISTRATIVE AGENT’S
ACCOUNT, AN AMOUNT IN THE APPLICABLE CURRENCY SUCH THAT EACH SUCH CANADIAN
LENDER SHALL, UPON TRANSFER OF SUCH AMOUNT, HAVE AS OF THE SETTLEMENT DATE, ITS
PRO RATA SHARE OF THE CANADIAN ADVANCES (INCLUDING CANADIAN SWING LOANS AND
CANADIAN PROTECTIVE ADVANCES), AND (Z) IF A LENDER’S BALANCE OF THE EUROPEAN
ADVANCES (INCLUDING EUROPEAN SWING LOANS AND EUROPEAN PROTECTIVE ADVANCES) IS
LESS THAN SUCH LENDER’S PRO RATA SHARE OF THE EUROPEAN ADVANCES (INCLUDING
EUROPEAN SWING LOANS AND EUROPEAN PROTECTIVE ADVANCES) AS OF A SETTLEMENT DATE,
SUCH LENDER SHALL NO LATER THAN 12:00 P.M. (CALIFORNIA TIME) ON THE SETTLEMENT
DATE TRANSFER IN IMMEDIATELY AVAILABLE FUNDS TO THE APPLICABLE EUROPEAN
ADMINISTRATIVE AGENT’S ACCOUNT, AN AMOUNT IN THE APPLICABLE CURRENCY SUCH THAT
EACH SUCH LENDER SHALL, UPON TRANSFER OF SUCH AMOUNT, HAVE AS OF THE SETTLEMENT
DATE, ITS PRO RATA SHARE OF THE EUROPEAN ADVANCES (INCLUDING EUROPEAN SWING
LOANS AND EUROPEAN PROTECTIVE ADVANCES).  SUCH AMOUNTS MADE AVAILABLE TO
ADMINISTRATIVE AGENT UNDER CLAUSE (X) OF THE IMMEDIATELY PRECEDING SENTENCE
SHALL BE APPLIED AGAINST THE AMOUNTS OF THE APPLICABLE US SWING LOANS OR US
PROTECTIVE ADVANCES AND, TOGETHER WITH THE PORTION OF SUCH US SWING LOANS OR US
PROTECTIVE ADVANCES REPRESENTING THE US SWING LENDER’S PRO RATA SHARE THEREOF,
SHALL CONSTITUTE US ADVANCES OF SUCH LENDERS, SUCH AMOUNTS MADE AVAILABLE TO
CANADIAN ADMINISTRATIVE AGENT UNDER CLAUSE (Y) OF THE IMMEDIATELY PRECEDING
SENTENCE SHALL BE APPLIED AGAINST THE AMOUNTS OF THE APPLICABLE CANADIAN SWING
LOANS OR CANADIAN PROTECTIVE ADVANCES AND, TOGETHER WITH THE PORTION OF SUCH
CANADIAN SWING LOANS OR CANADIAN PROTECTIVE ADVANCES REPRESENTING THE CANADIAN
SWING LENDER’S PRO RATA SHARE THEREOF, SHALL CONSTITUTE CANADIAN ADVANCES OF
SUCH CANADIAN LENDERS, AND SUCH AMOUNTS MADE AVAILABLE TO EUROPEAN
ADMINISTRATIVE AGENT UNDER CLAUSE (Z) OF THE IMMEDIATELY PRECEDING SENTENCE
SHALL BE APPLIED AGAINST THE AMOUNTS OF THE APPLICABLE EUROPEAN SWING LOANS OR
EUROPEAN PROTECTIVE ADVANCES AND, TOGETHER WITH THE PORTION OF SUCH EUROPEAN
SWING LOANS OR EUROPEAN PROTECTIVE ADVANCES REPRESENTING THE EUROPEAN SWING
LENDER’S PRO RATA SHARE THEREOF, SHALL CONSTITUTE EUROPEAN ADVANCES OF SUCH
LENDERS.  IF ANY SUCH AMOUNT IS NOT

 

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MADE AVAILABLE TO ADMINISTRATIVE AGENT, CANADIAN ADMINISTRATIVE AGENT OR
EUROPEAN ADMINISTRATIVE AGENT, AS APPLICABLE, BY ANY LENDER ON THE SETTLEMENT
DATE APPLICABLE THERETO TO THE EXTENT REQUIRED BY THE TERMS HEREOF, SUCH AGENT
SHALL BE ENTITLED TO RECOVER FOR ITS ACCOUNT SUCH AMOUNT ON DEMAND FROM SUCH
LENDER TOGETHER WITH INTEREST THEREON AT THE DEFAULTING LENDER RATE.

 

(II)                                  IN DETERMINING WHETHER A LENDER’S BALANCE
OF THE ADVANCES, SWING LOANS, AND PROTECTIVE ADVANCES IS LESS THAN, EQUAL TO, OR
GREATER THAN SUCH LENDER’S PRO RATA SHARE OF THE ADVANCES, SWING LOANS, AND
PROTECTIVE ADVANCES AS OF A SETTLEMENT DATE, ADMINISTRATIVE AGENT, CANADIAN
ADMINISTRATIVE AGENT OR EUROPEAN ADMINISTRATIVE AGENT, AS APPLICABLE, SHALL, AS
PART OF THE RELEVANT SETTLEMENT, APPLY TO SUCH BALANCE THE PORTION OF PAYMENTS
ACTUALLY RECEIVED IN GOOD FUNDS BY SUCH AGENT WITH RESPECT TO PRINCIPAL,
INTEREST, FEES PAYABLE BY BORROWERS AND ALLOCABLE TO THE LENDERS HEREUNDER, AND
PROCEEDS OF COLLATERAL; PROVIDED, THAT, PAYMENTS RECEIVED FROM FOREIGN BORROWERS
AND PROCEEDS OF FOREIGN COLLATERAL SHALL BE APPLIED ONLY TO THE FOREIGN
ADVANCES.  TO THE EXTENT THAT A NET AMOUNT IS OWED TO ANY SUCH LENDER AFTER SUCH
APPLICATION, SUCH NET AMOUNT SHALL BE DISTRIBUTED BY SUCH AGENT TO THAT LENDER
AS PART OF THE NEXT SETTLEMENT.

 

(III)                               BETWEEN SETTLEMENT DATES, (A) ADMINISTRATIVE
AGENT, TO THE EXTENT NO US PROTECTIVE ADVANCES OR US SWING LOANS ARE
OUTSTANDING, MAY PAY OVER TO US SWING LENDER ANY PAYMENTS RECEIVED BY
ADMINISTRATIVE AGENT, THAT IN ACCORDANCE WITH THE TERMS OF THIS AGREEMENT WOULD
BE APPLIED TO THE REDUCTION OF THE US ADVANCES, FOR APPLICATION TO US SWING
LENDER’S PRO RATA SHARE OF THE US ADVANCES, (B) CANADIAN ADMINISTRATIVE AGENT,
TO THE EXTENT NO CANADIAN PROTECTIVE ADVANCES OR CANADIAN SWING LOANS ARE
OUTSTANDING, MAY PAY OVER TO CANADIAN SWING LENDER ANY PAYMENTS RECEIVED BY
CANADIAN ADMINISTRATIVE AGENT, THAT IN ACCORDANCE WITH THE TERMS OF THIS
AGREEMENT WOULD BE APPLIED TO THE REDUCTION OF THE CANADIAN ADVANCES, FOR
APPLICATION TO CANADIAN SWING LENDER’S PRO RATA SHARE OF THE CANADIAN ADVANCES,
AND (C) EUROPEAN ADMINISTRATIVE AGENT, TO THE EXTENT NO EUROPEAN PROTECTIVE
ADVANCES OR EUROPEAN SWING LOANS ARE OUTSTANDING, MAY PAY OVER TO EUROPEAN SWING
LENDER ANY PAYMENTS RECEIVED BY EUROPEAN ADMINISTRATIVE AGENT, THAT IN
ACCORDANCE WITH THE TERMS OF THIS AGREEMENT WOULD BE APPLIED TO THE REDUCTION OF
THE EUROPEAN ADVANCES, FOR APPLICATION TO EUROPEAN SWING LENDER’S PRO RATA SHARE
OF THE EUROPEAN ADVANCES.  IF, AS OF ANY SETTLEMENT DATE, COLLECTIONS OF US LOAN
PARTIES RECEIVED SINCE THE THEN IMMEDIATELY PRECEDING SETTLEMENT DATE HAVE BEEN
APPLIED TO US SWING LENDER’S PRO RATA SHARE OF THE ADVANCES OTHER THAN TO US
SWING LOANS, AS PROVIDED FOR IN THE FIRST SENTENCE OF THIS CLAUSE (III), US
SWING LENDER SHALL PAY TO ADMINISTRATIVE AGENT FOR THE ACCOUNTS OF THE LENDERS,
AND ADMINISTRATIVE AGENT SHALL PAY TO THE LENDERS, TO BE APPLIED TO THE
OUTSTANDING US ADVANCES OF SUCH LENDERS, AN AMOUNT SUCH THAT EACH LENDER SHALL,
UPON RECEIPT OF SUCH AMOUNT, HAVE, AS OF SUCH SETTLEMENT DATE, ITS PRO RATA
SHARE OF THE US ADVANCES.  IF, AS OF ANY SETTLEMENT DATE, COLLECTIONS OF FOREIGN
LOAN PARTIES RECEIVED SINCE THE THEN IMMEDIATELY PRECEDING SETTLEMENT DATE HAVE
BEEN APPLIED TO CANADIAN SWING LENDER’S PRO RATA SHARE OF THE CANADIAN ADVANCES
OTHER THAN TO CANADIAN SWING LOANS, AS PROVIDED FOR IN THE FIRST SENTENCE OF
THIS CLAUSE (III), CANADIAN SWING LENDER SHALL PAY TO CANADIAN ADMINISTRATIVE
AGENT FOR THE ACCOUNTS OF THE CANADIAN LENDERS, AND CANADIAN ADMINISTRATIVE
AGENT SHALL PAY TO THE CANADIAN LENDERS, TO BE APPLIED TO THE OUTSTANDING

 

18

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CANADIAN ADVANCES OF SUCH CANADIAN LENDERS, AN AMOUNT SUCH THAT EACH CANADIAN
LENDER SHALL, UPON RECEIPT OF SUCH AMOUNT, HAVE, AS OF SUCH SETTLEMENT DATE, ITS
PRO RATA SHARE OF THE CANADIAN ADVANCES.  IF, AS OF ANY SETTLEMENT DATE,
COLLECTIONS OF FOREIGN LOAN PARTIES RECEIVED SINCE THE THEN IMMEDIATELY
PRECEDING SETTLEMENT DATE HAVE BEEN APPLIED TO EUROPEAN SWING LENDER’S PRO RATA
SHARE OF THE ADVANCES OTHER THAN TO EUROPEAN SWING LOANS, AS PROVIDED FOR IN THE
FIRST SENTENCE OF THIS CLAUSE (III), EUROPEAN SWING LENDER SHALL PAY TO EUROPEAN
ADMINISTRATIVE AGENT FOR THE ACCOUNTS OF THE LENDERS, AND EUROPEAN
ADMINISTRATIVE AGENT SHALL PAY TO THE LENDERS, TO BE APPLIED TO THE OUTSTANDING
EUROPEAN ADVANCES OF SUCH LENDERS, AN AMOUNT SUCH THAT EACH LENDER SHALL, UPON
RECEIPT OF SUCH AMOUNT, HAVE, AS OF SUCH SETTLEMENT DATE, ITS PRO RATA SHARE OF
THE EUROPEAN ADVANCES.  DURING THE PERIOD BETWEEN SETTLEMENT DATES, US SWING
LENDER WITH RESPECT TO US SWING LOANS, CANADIAN SWING LENDER WITH RESPECT TO
CANADIAN SWING LOANS, EUROPEAN SWING LENDER WITH RESPECT TO EUROPEAN SWING
LOANS, ADMINISTRATIVE AGENT WITH RESPECT TO US PROTECTIVE ADVANCES, CANADIAN
ADMINISTRATIVE AGENT WITH RESPECT TO CANADIAN PROTECTIVE ADVANCES, EUROPEAN
ADMINISTRATIVE AGENT WITH RESPECT TO EUROPEAN PROTECTIVE ADVANCES, AND EACH
LENDER (SUBJECT TO THE EFFECT OF AGREEMENTS BETWEEN SUCH AGENT AND INDIVIDUAL
LENDERS) WITH RESPECT TO THE ADVANCES OTHER THAN SWING LOANS AND PROTECTIVE
ADVANCES, SHALL BE ENTITLED TO INTEREST AT THE APPLICABLE RATE OR RATES PAYABLE
UNDER THIS AGREEMENT ON THE DAILY AMOUNT OF FUNDS EMPLOYED BY SWING LENDERS,
AGENTS, OR THE LENDERS, AS APPLICABLE.

 

(F)                                    NOTATION.  ADMINISTRATIVE AGENT SHALL
RECORD ON ITS BOOKS THE PRINCIPAL AMOUNT OF THE US ADVANCES (OR PORTION OF THE
TERM LOAN A, AS APPLICABLE) OWING TO EACH US LENDER, INCLUDING THE US SWING
LOANS OWING TO EACH SWING LENDER, AND US PROTECTIVE ADVANCES OWING TO
ADMINISTRATIVE AGENT, AND THE INTERESTS THEREIN OF EACH US LENDER, FROM TIME TO
TIME AND SUCH RECORDS SHALL, ABSENT MANIFEST ERROR, CONCLUSIVELY BE PRESUMED TO
BE CORRECT AND ACCURATE.  ADMINISTRATIVE AGENT AND/OR CANADIAN ADMINISTRATIVE
AGENT SHALL RECORD ON ITS BOOKS THE PRINCIPAL AMOUNT OF THE CANADIAN ADVANCES
OWING TO EACH CANADIAN LENDER, INCLUDING THE CANADIAN SWING LOANS OWING TO
CANADIAN SWING LENDER, AND CANADIAN PROTECTIVE ADVANCES OWING TO CANADIAN
ADMINISTRATIVE AGENT, AND THE INTERESTS THEREIN OF EACH CANADIAN LENDER, FROM
TIME TO TIME AND SUCH RECORDS SHALL, ABSENT MANIFEST ERROR, CONCLUSIVELY BE
PRESUMED TO BE CORRECT AND ACCURATE.  EUROPEAN ADMINISTRATIVE AGENT SHALL RECORD
ON ITS BOOKS THE PRINCIPAL AMOUNT OF THE EUROPEAN ADVANCES OWING TO EACH
EUROPEAN LENDER, INCLUDING EUROPEAN PROTECTIVE ADVANCES OWING TO EUROPEAN
ADMINISTRATIVE AGENT, AND THE INTERESTS THEREIN OF EACH EUROPEAN LENDER, FROM
TIME TO TIME AND SUCH RECORDS SHALL, ABSENT MANIFEST ERROR, CONCLUSIVELY BE
PRESUMED TO BE CORRECT AND ACCURATE.  IN ADDITION, EACH LENDER IS AUTHORIZED, AT
SUCH LENDER’S OPTION, TO NOTE THE DATE AND AMOUNT OF EACH PAYMENT OR PREPAYMENT
OF PRINCIPAL OF SUCH LENDER’S ADVANCES (OR PORTION OF THE TERM LOAN A, AS
APPLICABLE) IN ITS BOOKS AND RECORDS, INCLUDING COMPUTER RECORDS.

 

(G)                                 LENDERS’ FAILURE TO PERFORM.  ALL ADVANCES
(OTHER THAN SWING LOANS AND PROTECTIVE ADVANCES) AND TERM LOAN A SHALL BE MADE
BY THE LENDERS CONTEMPORANEOUSLY AND IN ACCORDANCE WITH THEIR PRO RATA SHARES. 
IT IS UNDERSTOOD THAT (I) NO LENDER SHALL BE RESPONSIBLE FOR ANY FAILURE BY ANY
OTHER LENDER TO PERFORM ITS OBLIGATION TO MAKE ANY ADVANCE OR TERM LOAN A (OR
OTHER EXTENSION OF CREDIT) HEREUNDER, NOR SHALL ANY COMMITMENT OF ANY LENDER BE
INCREASED OR DECREASED AS A RESULT OF ANY FAILURE BY ANY OTHER

 

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LENDER TO PERFORM ITS OBLIGATIONS HEREUNDER, AND (II) NO FAILURE BY ANY LENDER
TO PERFORM ITS OBLIGATIONS HEREUNDER SHALL EXCUSE ANY OTHER LENDER FROM ITS
OBLIGATIONS HEREUNDER.

 

2.4.                            PAYMENTS.

 

(A)                                  PAYMENTS BY BORROWERS.

 

(I)                                     EXCEPT AS OTHERWISE EXPRESSLY PROVIDED
HEREIN, ALL PAYMENTS BY US BORROWERS SHALL BE MADE IN THE APPLICABLE CURRENCY TO
THE APPLICABLE ADMINISTRATIVE AGENT’S ACCOUNT FOR THE ACCOUNT OF THE LENDER
GROUP AND SHALL BE MADE IN IMMEDIATELY AVAILABLE FUNDS, NO LATER THAN 11:00 A.M.
(CALIFORNIA TIME) ON THE DATE SPECIFIED HEREIN, ALL PAYMENTS BY CANADIAN
BORROWERS SHALL BE MADE IN THE APPLICABLE CURRENCY TO THE APPLICABLE CANADIAN
ADMINISTRATIVE AGENT’S ACCOUNT FOR THE ACCOUNT OF THE LENDER GROUP AND SHALL BE
MADE IN IMMEDIATELY AVAILABLE FUNDS, NO LATER THAN 11:00 A.M. (CALIFORNIA TIME)
ON THE DATE SPECIFIED HEREIN AND ALL PAYMENTS BY EUROPEAN BORROWERS SHALL BE
MADE IN THE APPLICABLE CURRENCY TO THE APPLICABLE EUROPEAN ADMINISTRATIVE
AGENT’S ACCOUNT FOR THE ACCOUNT OF THE LENDER GROUP AND SHALL BE MADE IN
IMMEDIATELY AVAILABLE FUNDS, NO LATER THAN 11:00 A.M. (CALIFORNIA TIME) ON THE
DATE SPECIFIED HEREIN.  ANY PAYMENT RECEIVED BY THE APPLICABLE AGENT LATER THAN
11:00 A.M. (CALIFORNIA TIME) SHALL BE DEEMED TO HAVE BEEN RECEIVED ON THE
FOLLOWING BUSINESS DAY AND ANY APPLICABLE INTEREST OR FEE SHALL CONTINUE TO
ACCRUE UNTIL SUCH FOLLOWING BUSINESS DAY.  IF ANY PAYMENT HEREUNDER BECOMES DUE
AND PAYABLE ON A DAY OTHER THAN A BUSINESS DAY, EXCEPT TO THE EXTENT THE AMOUNT
THEREOF IS CHARGED TO A LOAN ACCOUNT PURSUANT TO THE TERMS OF THIS AGREEMENT ON
OR AS OF SUCH DUE DATE, THE DUE DATE OF SUCH PAYMENT SHALL BE EXTENDED TO THE
NEXT SUCCEEDING BUSINESS DAY.

 

(II)                                  UNLESS THE APPLICABLE AGENT RECEIVES
NOTICE FROM ADMINISTRATIVE BORROWER PRIOR TO THE DATE ON WHICH ANY PAYMENT IS
DUE TO THE LENDERS THAT THE APPLICABLE BORROWERS WILL NOT MAKE SUCH PAYMENT IN
FULL AS AND WHEN REQUIRED, SUCH AGENT MAY ASSUME THAT SUCH BORROWERS HAVE MADE
(OR WILL MAKE) SUCH PAYMENT IN FULL TO SUCH AGENT ON SUCH DATE IN IMMEDIATELY
AVAILABLE FUNDS IN THE APPLICABLE CURRENCY AND SUCH AGENT MAY (BUT SHALL NOT BE
SO REQUIRED), IN RELIANCE UPON SUCH ASSUMPTION, DISTRIBUTE TO EACH LENDER ON
SUCH DUE DATE AN AMOUNT EQUAL TO THE AMOUNT THEN DUE SUCH LENDER.  IF AND TO THE
EXTENT THE APPLICABLE BORROWERS DO NOT MAKE SUCH PAYMENT IN FULL TO THE
APPLICABLE AGENT ON THE DATE WHEN DUE, EACH LENDER SEVERALLY SHALL REPAY TO SUCH
AGENT ON DEMAND SUCH AMOUNT DISTRIBUTED TO SUCH LENDER, TOGETHER WITH INTEREST
THEREON AT THE DEFAULTING LENDER RATE FOR EACH DAY FROM THE DATE SUCH AMOUNT IS
DISTRIBUTED TO SUCH LENDER UNTIL THE DATE REPAID.

 

(III)                               IF, NOTWITHSTANDING THE TERMS OF THIS
AGREEMENT, ANY AGENT RECEIVES ANY PAYMENT FROM OR ON BEHALF OF ANY BORROWER IN A
CURRENCY OTHER THAN THE APPLICABLE CURRENCY, SUCH AGENT MAY CONVERT THE PAYMENT
(INCLUDING THE MONETARY PROCEEDS OF REALIZATION UPON ANY COLLATERAL AND ANY
FUNDS THEN HELD IN A CASH COLLATERAL ACCOUNT) INTO THE APPLICABLE CURRENCY AT
THE CURRENCY EXCHANGE RATE IN THE MANNER CONTEMPLATED BY SECTION 10.4.  TO THE
EXTENT PERMITTED BY LAW, THE OBLIGATION SHALL BE SATISFIED ONLY TO THE EXTENT OF
THE AMOUNT ACTUALLY RECEIVED BY SUCH AGENT UPON SUCH CONVERSION.

 

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(B)                                 APPORTIONMENT AND APPLICATION.

 

(I)                                     EXCEPT AS OTHERWISE PROVIDED WITH
RESPECT TO DEFAULTING LENDERS AND EXCEPT AS OTHERWISE PROVIDED IN THE LOAN
DOCUMENTS, AGGREGATE PRINCIPAL AND INTEREST PAYMENTS SHALL BE APPORTIONED
RATABLY AMONG THE LENDERS (ACCORDING TO THE UNPAID PRINCIPAL BALANCE OF THE
OBLIGATIONS TO WHICH SUCH PAYMENTS RELATE HELD BY EACH LENDER) AND PAYMENTS OF
FEES AND EXPENSES (OTHER THAN FEES OR EXPENSES THAT ARE FOR AN AGENT’S SEPARATE
ACCOUNT, AFTER GIVING EFFECT TO ANY AGREEMENTS BETWEEN AN AGENT AND INDIVIDUAL
LENDERS) SHALL BE APPORTIONED RATABLY AMONG THE LENDERS HAVING A PRO RATA SHARE
OF THE TYPE OF COMMITMENT OR OBLIGATION TO WHICH A PARTICULAR FEE OR EXPENSE
RELATES.  EXCEPT AS OTHERWISE SPECIFICALLY PROVIDED IN PARAGRAPH (B)(IV) BELOW
OR SECTION 2.4(C) OR (D), ALL COLLECTIONS, PROCEEDS OF ACCOUNTS OR OTHER
COLLATERAL OWNED BY ANY US LOAN PARTY AND PAYMENTS BY ANY US LOAN PARTY SHALL BE
APPLIED IN THE ORDER OF PAYMENT SET FORTH IN SUBSECTION (A) BELOW AND ALL
COLLECTIONS, PROCEEDS OF ACCOUNTS OR OTHER COLLATERAL OWNED BY ANY FOREIGN
BORROWER OR FOREIGN GUARANTOR AND PAYMENTS BY ANY FOREIGN BORROWER OR FOREIGN
GUARANTOR SHALL BE APPLIED IN THE ORDER OF PAYMENT SET FORTH IN
SUBSECTION (B) BELOW.

 

(A)                    EXCEPT AS SET FORTH ABOVE AND SUBJECT TO THE TERMS OF THE
INTERCREDITOR AGREEMENT, ALL COLLECTIONS, PROCEEDS OF ACCOUNTS OR OTHER
COLLATERAL OWNED BY ANY US LOAN PARTY AND PAYMENTS BY ANY US LOAN PARTY SHALL BE
APPLIED IN THE FOLLOWING ORDER OF PAYMENT:

 

(1)                                  first, ratably to pay any Lender Group
Expenses payable by the US Loan Parties then due to Administrative Agent or
Collateral Agent or any of the Lenders under the Loan Documents, until paid in
full,

 

(2)                                  second, ratably to pay any fees or premiums
payable by US Loan Parties then due to Administrative Agent or Collateral Agent
(for their separate account, after giving effect to any agreements between
Administrative Agent or Collateral Agent and individual Lenders) or any of the
Lenders under the Loan Documents until paid in full,

 

(3)                                  third, to pay interest due in respect of
all US Protective Advances until paid in full,

 

(4)                                  fourth, ratably to pay interest due in
respect of the US Advances (other than US Protective Advances), the US Swing
Loans, and the Term Loan A until paid in full,

 

(5)                                  fifth, to pay the principal of all US
Protective Advances until paid in full,

 

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(6)                                  sixth, ratably to pay all principal amounts
then due and payable (other than as a result of an acceleration thereof) with
respect to the Term Loan A until paid in full,

 

(7)                                  seventh, to pay the principal of all US
Swing Loans until paid in full,

 

(8)                                  eighth, so long as no Event of Default has
occurred and is continuing, and at Administrative Agent’s election (which
election Administrative Agent agrees will not be made if an Overadvance would be
created thereby), to pay amounts then due and owing by US Loan Parties in
respect of Bank Products, until paid in full,

 

(9)                                  ninth, so long as no Event of Default has
occurred and is continuing, to pay the principal of all US Advances until paid
in full; provided, that payments shall be applied first to US Advances that are
Base Rate Loans until paid in full and, second, to US Advances that are LIBOR
Rate Loans until paid in full,

 

(10)                            tenth, if an Event of Default has occurred and
is continuing, ratably (i) to pay the principal of all US Advances until paid in
full, (ii) to Collateral Agent, to be held by Collateral Agent, for the ratable
benefit of Issuing Lender and those Lenders having a Revolver Commitment, as
cash collateral in an amount up to 105% of the US Letter of Credit Usage until
collateralized in full, and (iii) to Collateral Agent, to be held by Collateral
Agent, for the benefit of the Bank Product Providers, as cash collateral in an
amount up to the amount of the Bank Product Reserve in respect of Bank Products
provided to any US Loan Party established prior to the occurrence of, and not in
contemplation of, the subject Event of Default until US Loan Parties’
obligations in respect of such Bank Products have been paid in full or the cash
collateral amount has been exhausted,

 

(11)                            eleventh, if an Event of Default has occurred
and is continuing, to pay the outstanding principal balance of Term Loan A (in
the inverse order of the maturity of the installments due thereunder) until Term
Loan A is paid in full,

 

(12)                            twelfth, if an Event of Default has occurred and
is continuing, to pay any other US Obligations (including the provision of
amounts to Collateral Agent, to be held by Collateral Agent, for the benefit of
the Bank Product Providers, as cash collateral in an amount up to the amount
determined by Collateral Agent in its Permitted Discretion as the amount
necessary to secure US Loan Parties’ obligations in respect of Bank Products),

 

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(13)                            thirteenth, to the payment of the Foreign
Obligations in the order of payment set forth in subsection (B) below, until
paid in full; and

 

(14)                            fourteenth, to US Borrowers (to be wired to the
applicable US Designated Account) or such other Person entitled thereto under
Applicable Law.

 

(B)                      EXCEPT AS SET FORTH ABOVE, ALL COLLECTIONS, PROCEEDS OF
ACCOUNTS OR OTHER COLLATERAL OWNED BY ANY FOREIGN BORROWER OR FOREIGN GUARANTOR
AND PAYMENTS BY ANY FOREIGN BORROWER OR FOREIGN GUARANTOR SHALL BE APPLIED IN
THE FOLLOWING ORDER OF PAYMENT:

 

(1)                                  first, ratably to pay any Lender Group
Expenses payable by the Foreign Borrowers and Foreign Guarantors then due to
Canadian Administrative Agent, the European Administrative Agent or Collateral
Agent or any of the Lenders under the Loan Documents, until paid in full,

 

(2)                                  second, ratably to pay any fees or premiums
payable by the Foreign Borrowers and Foreign Guarantors then due to
Administrative Agent (for its separate account) or any of the Lenders under the
Loan Documents until paid in full,

 

(3)                                  third, to pay interest due in respect of
all Protective Advances to Foreign Borrowers until paid in full,

 

(4)                                  fourth, ratably to pay interest due in
respect of the Foreign Advances (other than Protective Advances to Foreign
Borrowers), the European Swing Loans and the Canadian Swing Loans until paid in
full,

 

(5)                                  fifth, to pay the principal of all
Protective Advances to Foreign Borrowers until paid in full,

 

(6)                                  sixth, ratably to pay the principal of all
European Swing Loans and Canadian Swing Loans until paid in full,

 

(7)                                  seventh, so long as no Event of Default has
occurred and is continuing, and at Administrative Agent’s election (which
election Administrative Agent agrees will not be made if an Overadvance would be
created thereby), to pay amounts then due and owing by Foreign Borrowers or
Foreign Guarantors in respect of Bank Products, until paid in full,

 

(8)                                  eighth, so long as no Event of Default has
occurred and is continuing, ratably, to pay the principal of all Foreign
Advances until

 

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paid in full; provided, that payments applied to Canadian Advances shall be
applied first to Canadian Advances that are Base Rate Loans until paid in full
and, second, to Canadian Advances that are LIBOR Rate Loans until paid in full,

 

(9)                                  ninth, if an Event of Default has occurred
and is continuing, ratably (i) to pay the principal of all Foreign Advances
until paid in full, and (ii) to Collateral Agent, to be held by Collateral
Agent, for the ratable benefit of the Canadian Issuing Lender and those Lenders
having a Canadian Revolver Commitment, as cash collateral in an amount up to
105% of the Canadian Letter of Credit Usage until collateralized in full, and
(iii) to Collateral Agent, to be held by Collateral Agent, for the ratable
benefit of the European Issuing Lender and those Lenders having a European
Revolver Commitment, as cash collateral in an amount up to 105% of the European
Letter of Credit Usage until collateralized in full, and (iv) to Collateral
Agent, to be held by Collateral Agent, for the benefit of the Bank Product
Providers, as cash collateral in an amount up to the amount of the Foreign Bank
Product Reserve in respect of Bank Products provided to Foreign Loan Parties
until Foreign Loan Parties’ and the Significant Subsidiaries’ obligations in
respect of such Bank Products have been paid in full or the cash collateral
amount has been exhausted,

 

(10)                            tenth, if an Event of Default has occurred and
is continuing, to pay any other Foreign Obligations (including the provision of
amounts to Collateral Agent, to be held by Collateral Agent, for the benefit of
the Bank Product Providers, as cash collateral in an amount up to the amount
determined by Collateral Agent in its Permitted Discretion as the amount
necessary to secure Foreign Loan Parties’ obligations in respect of Bank
Products), and

 

(11)                            eleventh, to Foreign Borrowers (to be wired to
the applicable Canadian Designated Account or European Designated Account) or
such other Person entitled thereto under Applicable Law;

 

(II)                                  NOTWITHSTANDING THE FOREGOING
SECTION 2.4(B)(I)(B), SO LONG AS NO EVENT OF DEFAULT HAS OCCURRED AND IS
CONTINUING, EXCEPT AS SET FORTH ABOVE, ALL COLLECTIONS, PROCEEDS OF ACCOUNTS OR
OTHER COLLATERAL OWNED BY (I) CANADIAN BORROWERS SHALL FIRST BE APPLIED ONLY TO
FOREIGN OBLIGATIONS OF CANADIAN BORROWERS IN ACCORDANCE WITH
SECTION 2.4(B)(I)(B) AND (II) EUROPEAN BORROWERS SHALL FIRST BE APPLIED ONLY TO
FOREIGN OBLIGATIONS OF EUROPEAN BORROWERS IN ACCORDANCE WITH
SECTION 2.4(B)(I)(B).

 

(III)                               THE APPLICABLE AGENT PROMPTLY SHALL
DISTRIBUTE TO EACH LENDER, PURSUANT TO THE APPLICABLE WIRE INSTRUCTIONS RECEIVED
FROM EACH LENDER IN WRITING, SUCH FUNDS AS IT MAY BE ENTITLED TO RECEIVE,
SUBJECT TO A SETTLEMENT DELAY AS PROVIDED IN SECTION 2.3(E).

 

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(IV)                              IN EACH INSTANCE, SO LONG AS NO EVENT OF
DEFAULT HAS OCCURRED AND IS CONTINUING, THE ORDER OF PAYMENT PROVISIONS OF THIS
SECTION 2.4(B) SHALL NOT APPLY TO ANY PAYMENT MADE BY ANY LOAN PARTY TO
ADMINISTRATIVE AGENT, CANADIAN ADMINISTRATIVE AGENT OR EUROPEAN ADMINISTRATIVE
AGENT, AS APPLICABLE, AND SPECIFIED BY SUCH LOAN PARTY TO BE FOR THE PAYMENT OF
SPECIFIC OBLIGATIONS THEN DUE AND PAYABLE (OR PREPAYABLE) UNDER ANY PROVISION OF
THIS AGREEMENT.

 

(V)                                 FOR PURPOSES OF THE FOREGOING, “PAID IN
FULL” MEANS PAYMENT OF ALL AMOUNTS OWING UNDER THE LOAN DOCUMENTS ACCORDING TO
THE TERMS THEREOF, INCLUDING LOAN FEES, SERVICE FEES, PROFESSIONAL FEES,
INTEREST (AND SPECIFICALLY INCLUDING INTEREST ACCRUED AFTER THE COMMENCEMENT OF
ANY INSOLVENCY PROCEEDING), DEFAULT INTEREST, INTEREST ON INTEREST, AND EXPENSE
REIMBURSEMENTS, WHETHER OR NOT ANY OF THE FOREGOING WOULD BE OR IS ALLOWED OR
DISALLOWED IN WHOLE OR IN PART IN ANY INSOLVENCY PROCEEDING.

 

(VI)                              IN THE EVENT OF A DIRECT CONFLICT BETWEEN THE
PRIORITY PROVISIONS OF THIS SECTION 2.4 AND OTHER PROVISIONS CONTAINED IN ANY
OTHER LOAN DOCUMENT, IT IS THE INTENTION OF THE PARTIES HERETO THAT SUCH
PRIORITY PROVISIONS IN SUCH DOCUMENTS SHALL BE READ TOGETHER AND CONSTRUED, TO
THE FULLEST EXTENT POSSIBLE, TO BE IN CONCERT WITH EACH OTHER.  IN THE EVENT OF
ANY ACTUAL, IRRECONCILABLE CONFLICT THAT CANNOT BE RESOLVED AS AFORESAID, THE
TERMS AND PROVISIONS OF THIS SECTION 2.4 SHALL CONTROL AND GOVERN.

 

(C)                                  MANDATORY PREPAYMENTS.

 

(I)                                     WITHIN 5 DAYS AFTER DELIVERY TO
ADMINISTRATIVE AGENT OF THE AUDITED ANNUAL FINANCIAL STATEMENTS PURSUANT TO
SECTION 5.3 WITH RESPECT TO ANY FISCAL YEAR, COMMENCING WITH THE DELIVERY TO
ADMINISTRATIVE AGENT OF THE FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED
DECEMBER 31, 2005 OR, IF SUCH FINANCIAL STATEMENTS ARE NOT DELIVERED TO
ADMINISTRATIVE AGENT ON OR PRIOR TO THE DATE SUCH STATEMENTS ARE REQUIRED TO BE
DELIVERED PURSUANT TO SECTION 5.3, 5 DAYS AFTER THE DATE SUCH STATEMENTS ARE
REQUIRED TO BE DELIVERED TO ADMINISTRATIVE AGENT PURSUANT TO SECTION 5.3, US
BORROWERS SHALL (UNLESS THE OBLIGATION TO MAKE SUCH PAYMENT IS WAIVED IN WRITING
BY THE REQUIRED LENDERS PRIOR TO THE DATE ON WHICH SUCH PAYMENT IS REQUIRED TO
BE MADE) PREPAY THE OUTSTANDING PRINCIPAL OF THE TERM LOAN A AND, UNLESS THE
OBLIGATION TO MAKE SUCH PAYMENT IS WAIVED UNDER THE TERM B DEBT DOCUMENTS, TERM
B DEBT, IN AN AGGREGATE AMOUNT EQUAL TO 50% OF THE EXCESS CASH FLOW OF
ADMINISTRATIVE BORROWER AND ITS SUBSIDIARIES FOR SUCH FISCAL YEAR (OR WITH
RESPECT TO THE FISCAL YEAR ENDED DECEMBER 31, 2005, FOR THE PERIOD COMMENCING ON
AUGUST 1, 2005 AND ENDING ON THE LAST DAY OF SUCH FISCAL YEAR), SUCH PREPAYMENT
TO BE APPLIED TO THE OUTSTANDING TERM LOAN A AND TERM B DEBT IN ACCORDANCE WITH
CLAUSE (D)(I) BELOW.

 

(II)                                  WITHIN THREE BUSINESS DAYS FOLLOWING THE
CONSUMMATION OF ANY VOLUNTARY OR INVOLUNTARY SALE OR DISPOSITION BY ANY US LOAN
PARTY OF PROPERTY OR ASSETS (OTHER THAN SALES OR DISPOSITIONS DESCRIBED IN
CLAUSES (B), (C), (D), (F), (G), (I), (J), (K)(Y), (L), OR (N) OF THE DEFINITION
OF “PERMITTED DISPOSITIONS”), US BORROWERS SHALL (UNLESS THE OBLIGATION TO MAKE
SUCH PAYMENT IS WAIVED IN WRITING BY THE REQUIRED LENDERS PRIOR TO THE DATE ON
WHICH SUCH PAYMENT IS REQUIRED TO BE MADE) PREPAY THE OUTSTANDING PRINCIPAL OF
THE OBLIGATIONS AND, UNLESS THE OBLIGATION TO MAKE SUCH PAYMENT IS WAIVED UNDER
THE TERM B

 

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DEBT DOCUMENTS, TERM B DEBT IN ACCORDANCE WITH CLAUSE (D)(II) BELOW IN AN
AGGREGATE AMOUNT EQUAL TO 100% OF THE NET CASH PROCEEDS RECEIVED BY SUCH PERSON
IN CONNECTION WITH SUCH SALE OR DISPOSITION BUT ONLY TO THE EXTENT THAT THE
DOLLAR EQUIVALENT OF THE AGGREGATE AMOUNT OF NET CASH PROCEEDS RECEIVED BY THE
US LOAN PARTIES (AND NOT APPLIED AS A PREPAYMENT OF THE OBLIGATIONS OR THE TERM
B DEBT) FOR ALL SUCH SALES OR DISPOSITIONS SHALL EXCEED $1,000,000 IN ANY FISCAL
YEAR; PROVIDED, THAT US BORROWERS SHALL NOT BE REQUIRED TO MAKE SUCH PREPAYMENT
IF (A) SUCH SALE INVOLVES THE PROPERTY DESCRIBED IN, AND IS SUBJECT TO THE TERMS
OF, THE PRE-APPROVED ASSET DISPOSITION LETTER, (B) SUCH SALE IS CONSUMMATED IN
ACCORDANCE WITH THE TERMS OF THE PRE-APPROVED ASSET DISPOSITION LETTER AND
(C) THE NET CASH PROCEEDS OF SUCH SALE ARE USED TO PREPAY THE TERM B DEBT. 
NOTHING CONTAINED IN THIS SUBCLAUSE (II) SHALL PERMIT ANY US LOAN PARTY TO SELL
OR OTHERWISE DISPOSE OF ANY PROPERTY OR ASSETS OTHER THAN IN ACCORDANCE WITH
SECTION 6.4.

 

(III)                               WITHIN THREE BUSINESS DAYS FOLLOWING THE
RECEIPT BY ANY US LOAN PARTY OF ANY EXTRAORDINARY RECEIPTS, US BORROWERS SHALL
(UNLESS THE OBLIGATION TO MAKE SUCH PAYMENT IS WAIVED IN WRITING BY THE REQUIRED
LENDERS PRIOR TO THE DATE ON WHICH SUCH PAYMENT IS REQUIRED TO BE MADE) PREPAY
THE OUTSTANDING PRINCIPAL OF THE OBLIGATIONS AND, UNLESS THE OBLIGATION TO MAKE
SUCH PAYMENT IS WAIVED UNDER THE TERM B DEBT DOCUMENTS,  TERM B DEBT, IN
ACCORDANCE WITH CLAUSE (D)(II) BELOW IN AN AGGREGATE AMOUNT EQUAL TO 100% OF
SUCH EXTRAORDINARY RECEIPTS, NET OF ANY AMOUNTS PAYABLE BY SUCH PERSON AS A
RESULT OF SUCH EVENT AND OF ANY TAXES, FEES PAYABLE TO PERSONS THAT ARE NOT
AFFILIATES OF ANY US LOAN PARTY OR REASONABLE EXPENSES INCURRED IN COLLECTING
SUCH EXTRAORDINARY RECEIPTS, BUT ONLY TO THE EXTENT THAT THE DOLLAR EQUIVALENT
OF THE AGGREGATE AMOUNT OF SUCH NET EXTRAORDINARY RECEIPTS RECEIVED BY THE US
LOAN PARTIES (AND NOT APPLIED AS A PREPAYMENT OF THE PRINCIPAL OF THE
OBLIGATIONS OR THE TERM B DEBT) FOR ANY SINGLE OR RELATED SERIES OF
EXTRAORDINARY RECEIPTS SHALL EXCEED $75,000 OR FOR ALL SUCH EXTRAORDINARY
RECEIPTS SHALL EXCEED $750,000 IN ANY FISCAL YEAR.

 

(IV)                              WITHIN THREE BUSINESS DAYS FOLLOWING THE SALE,
ISSUANCE OR INCURRENCE BY ANY US LOAN PARTY OF ANY STOCK OR INDEBTEDNESS (OTHER
THAN (I) INDEBTEDNESS PERMITTED UNDER SECTION 6.1 (OTHER THAN INDEBTEDNESS IN
RESPECT OF A CONVERTIBLE NOTE OFFERING), (II) STOCK ISSUED BY ANY US LOAN PARTY
ON OR BEFORE THE CLOSING DATE, (III) STOCK ISSUED PURSUANT TO A STOCK OR OPTION
PLAN TO ANY OFFICER, INDEPENDENT CONTRACTOR IN A MANNER CONSISTENT WITH
HISTORICAL PRACTICES, EMPLOYEE OR DIRECTOR OF ADMINISTRATIVE BORROWER OR ANY OF
ITS SUBSIDIARIES, (IV) STOCK ISSUED UPON EXERCISE OF ANY STOCK REFERRED TO IN
CLAUSE (III), AND (V) STOCK ISSUED TO ANY LOAN PARTY), US BORROWERS SHALL
(UNLESS THE OBLIGATION TO MAKE SUCH PAYMENT IS WAIVED IN WRITING BY THE REQUIRED
LENDERS PRIOR TO THE DATE ON WHICH SUCH PAYMENT IS REQUIRED TO BE MADE) PREPAY
THE OUTSTANDING PRINCIPAL OF THE OBLIGATIONS AND, UNLESS THE OBLIGATION TO MAKE
SUCH PAYMENT IS WAIVED UNDER THE TERM B DEBT DOCUMENTS, TERM B DEBT, IN
ACCORDANCE WITH CLAUSE (D)(III) IN AN AGGREGATE AMOUNT EQUAL TO (A) 50% OF THE
NET CASH PROCEEDS RECEIVED BY SUCH US LOAN PARTY IN CONNECTION WITH SUCH SALE,
ISSUANCE, OR INCURRENCE UNTIL THE AGGREGATE AMOUNT OF NET CASH PROCEEDS RECEIVED
BY US LOAN PARTIES IN CONNECTION WITH ALL SUCH SALES, ISSUANCES, AND INCURRENCES
AFTER THE CLOSING DATE IS GREATER THAN $5,000,000 AND (B) 100% OF THE NET CASH
PROCEEDS RECEIVED BY SUCH US LOAN PARTY IN CONNECTION WITH SUCH SALE, ISSUANCE,
OR INCURRENCE AFTER THE AGGREGATE AMOUNT

 

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OF NET CASH PROCEEDS RECEIVED BY US LOAN PARTIES IN CONNECTION WITH ALL SUCH
SALES, ISSUANCES, AND INCURRENCES AFTER THE CLOSING DATE IS GREATER THAN
$5,000,000; PROVIDED, THAT US BORROWERS SHALL NOT BE REQUIRED TO MAKE SUCH
PREPAYMENT IF (A) THE PROCEEDS ARISE FROM A CONVERTIBLE NOTE OFFERING PERMITTED
HEREUNDER, AND (B) THE NET CASH PROCEEDS OF SUCH CONVERTIBLE NOTE OFFERING ARE
USED TO PREPAY THE TERM B DEBT IN FULL.

 

(V)                                 IN THE EVENT (A) THE SUM OF THE REVOLVER
USAGE (AFTER GIVING EFFECT TO ANY REPAYMENT OR PREPAYMENT OF THE LOANS MADE ON
OR PRIOR TO THE APPLICABLE DATE OF DETERMINATION BUT EXCLUDING LETTER OF CREDIT
USAGE CASH COLLATERALIZED IN AN AMOUNT UP TO 105% OF SUCH LETTER OF CREDIT
USAGE) AND THE OUTSTANDING PRINCIPAL BALANCE OF THE TERM LOAN A AT ANY TIME
EXCEEDS 2.25 TIMES THE AMOUNT OF EBITDA FOR THE MOST RECENTLY ENDED 12 MONTH
PERIOD, (B) THE SUM OF THE REVOLVER USAGE (AFTER GIVING EFFECT TO ANY REPAYMENT
OR PREPAYMENT OF THE LOANS MADE ON OR PRIOR TO THE APPLICABLE DATE OF
DETERMINATION BUT EXCLUDING LETTER OF CREDIT USAGE CASH COLLATERALIZED IN AN
AMOUNT UP TO 105% OF SUCH LETTER OF CREDIT USAGE) AND THE OUTSTANDING PRINCIPAL
BALANCE OF THE TERM LOAN A AND THE TERM B DEBT AT ANY TIME EXCEEDS 2.75 TIMES
THE AMOUNT OF EBITDA FOR THE MOST RECENTLY ENDED 12 MONTH PERIOD, OR (C) THE SUM
OF THE REVOLVER USAGE (AFTER GIVING EFFECT TO ANY REPAYMENT OR PREPAYMENT OF THE
LOANS MADE ON OR PRIOR TO THE APPLICABLE DATE OF DETERMINATION BUT EXCLUDING
LETTER OF CREDIT USAGE CASH COLLATERALIZED IN AN AMOUNT UP TO 105% OF SUCH
LETTER OF CREDIT USAGE) AND THE OUTSTANDING PRINCIPAL BALANCE OF THE TERM LOAN A
AND THE TERM B DEBT AND THE AGGREGATE PRINCIPAL AMOUNT OF ALL OTHER INDEBTEDNESS
(OTHER THAN CASH COLLATERALIZED LETTERS OF CREDIT) OF PARENT AND ITS
SUBSIDIARIES OUTSTANDING AS OF SUCH DATE IN THE AMOUNT THAT WOULD BE REFLECTED
AS DEBT ON A BALANCE SHEET PREPARED AS OF SUCH DATE ON A CONSOLIDATED BASIS IN
ACCORDANCE WITH GAAP AT ANY TIME EXCEEDS 3 TIMES THE AMOUNT OF EBITDA FOR THE
MOST RECENTLY ENDED 12 MONTH PERIOD, US BORROWERS (UNLESS THE OBLIGATION TO MAKE
SUCH PAYMENT IS WAIVED IN WRITING BY THE REQUIRED LENDERS PRIOR TO THE DATE ON
WHICH SUCH PAYMENT IS REQUIRED TO BE MADE) SHALL PREPAY THE OUTSTANDING
OBLIGATIONS AND, UNLESS THE OBLIGATION TO MAKE SUCH PAYMENT IS WAIVED UNDER THE
TERM B DEBT DOCUMENTS, TERM B DEBT IN ACCORDANCE WITH CLAUSE (D)(IV) BELOW IN AN
AGGREGATE AMOUNT EQUAL TO THE GREATER OF THE EXCESS RESULTING FROM CLAUSE
(A) ABOVE, THE EXCESS RESULTING FROM CLAUSE (B) ABOVE OR THE EXCESS RESULTING
FROM CLAUSE (C) ABOVE.

 

(D)                                 APPLICATION OF PAYMENTS.

 

(I)                                     EACH PREPAYMENT PURSUANT TO SUBCLAUSE
(C)(I) ABOVE (EXCESS CASH FLOW) SHALL FIRST, BE APPLIED TO THE OUTSTANDING
PRINCIPAL AMOUNT OF TERM LOAN A, UNTIL PAID IN FULL, AND SECOND, UNLESS THE
PREPAYMENT REQUIREMENT SHALL HAVE BEEN WAIVED THEREUNDER, PAID TO TERM B AGENT
FOR APPLICATION TO THE OUTSTANDING PRINCIPAL AMOUNT OF TERM B DEBT, UNTIL PAID
IN FULL; PROVIDED, THAT IF AN EVENT OF DEFAULT SHALL HAVE OCCURRED AND BE
CONTINUING, (X) AT ADMINISTRATIVE AGENT’S ELECTION, ANY PAYMENT TO BE PAID TO
TERM B AGENT FOR APPLICATION TO THE OUTSTANDING PRINCIPAL AMOUNT OF TERM B DEBT
SHALL BE APPLIED IN THE MANNER SET FORTH IN SECTION 2.4(B)(I)(A) AND (Y) AT
ADMINISTRATIVE AGENT’S ELECTION, ANY PREPAYMENT OF THE TERM LOAN A REQUIRED
PURSUANT TO SUBCLAUSE (C)(I) ABOVE SHALL BE APPLIED IN THE MANNER SET FORTH IN
SECTION 2.4(B)(I)(A).  EACH SUCH PREPAYMENT OF THE TERM LOAN A SHALL BE WITHOUT
PENALTY OR PREMIUM AND SHALL BE APPLIED AGAINST THE REMAINING INSTALLMENTS OF
PRINCIPAL OF THE TERM LOAN A IN THE INVERSE ORDER OF MATURITY.

 

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(II)                                  EACH PREPAYMENT PURSUANT TO SUBCLAUSES
(C)(II) ABOVE (SALES AND DISPOSITIONS) AND (C)(III) ABOVE (EXTRAORDINARY
RECEIPTS), SHALL BE APPLIED AS FOLLOWS:

 

(1)                                  if the proceeds are from any sale or
disposition of any Accounts of a US Loan Party or otherwise constitute proceeds
of Accounts of a US Loan Party, such proceeds shall be applied, first, to the
outstanding principal amount of the US Advances, until paid in full, second, to
cash collateralize the US Letters of Credit in an amount equal to 105% at the
then extant US Letter of Credit Usage, until cash collateralized in full, third,
to the outstanding principal amount of Term Loan A, until paid in full, and
fourth, unless the prepayment requirement shall have been waived under the Term
B Debt Documents, paid to Term B Agent for application to the outstanding
principal amount of Term B Debt, until paid in full; provided, that, any such
proceeds that would be applied to cash collateralize the US Letters of Credit
pursuant to clause second above may be retained by Borrowers to the extent US
Availability, after giving effect to such sale or disposition, would be greater
than $0 notwithstanding the failure to cash collateralize such US Letters of
Credit.  Each such prepayment of the Term Loan A shall be without penalty or
premium and shall be applied against the remaining installments of principal of
the Term Loan A in the inverse order of maturity.

 

(2)                                  subject to clause (3) below, if the
proceeds are from the sale or disposition of any other assets of a US Loan Party
not described in clause (1) above or any insurance policy or condemnation award
of a US Loan Party, such proceeds shall be applied, first, to the outstanding
principal amount of Term Loan A, until paid in full, and second, unless the
prepayment requirement shall have been waived under the Term B Debt Documents,
paid to Term B Agent for application to the outstanding principal amount of Term
B Debt, until paid in full.  Each such prepayment of the Term Loan A shall be
without penalty or premium and shall be applied against the remaining
installments of principal of the Term Loan A in the inverse order of maturity.
Notwithstanding the foregoing, except during the continuance of an Event of
Default, such proceeds shall not be required to be so applied to the extent that
such proceeds are used to replace, repair, or restore the properties or assets
in respect of which such proceeds were paid or are used to acquire equipment or
other tangible fixed assets to be used in the business of the US Loan Parties if
(i) the amount of proceeds received in respect of such sales, dispositions,
insurance policies, condemnation awards or Extraordinary Receipts, that are used
to replace, repair, or restore the properties or assets in respect of which such
proceeds were paid or are used to acquire equipment or other tangible fixed
assets are less than $2,000,000 in the aggregate during

 

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any 12 consecutive month period, (ii) Administrative Borrower delivers a
certificate to Administrative Agent within 10 days after such sale or loss,
destruction, or taking or Extraordinary Receipts event, stating that such
proceeds shall be used to replace, repair, or restore such properties or assets
or will be used to acquire equipment or other tangible fixed assets to be used
in the business of the US Loan Parties within a period specified in such
certificate not to exceed the earlier of (x) 180 days after the receipt of such
proceeds, and (y) the Maturity Date (which certificate shall set forth estimates
of the proceeds to be so expended), and (iii) such proceeds are immediately
deposited in a Deposit Account subject to a Control Agreement in favor of
Administrative Agent.  If all or any portion of such proceeds not so applied to
the prepayment of the Obligations or the Term B Debt in accordance with this
clause (2) are not used in accordance with the preceding sentence within the
period specified in the relevant certificate furnished pursuant hereto, such
remaining portion shall be applied to the Obligations and the Term B Debt in
accordance with this clause (2) on the last day of such specified period; and

 

(3)                                  if the proceeds are from a sale or
disposition of all or substantially all of the assets or Stock of any Person or
any insurance, which sale, disposition, or proceeds of insurance includes both
Accounts and other assets of a US Loan Party, such proceeds shall be applied as
follows:  (x) an amount equal to the net book value of such Accounts of US Loan
Parties (determined at the time of such sale or disposition or event resulting
in such insurance proceeds) shall be applied first, to the outstanding principal
amount of the US Advances, until paid in full, second, to cash collateralize the
US Letters of Credit in an amount equal to 105% at the then extant US Letter of
Credit Usage, until collateralized in full, third, to the outstanding principal
balance of Term Loan A, until paid in full, and fourth, unless such prepayment
requirement shall have been waived under the Term B Debt Documents, paid to Term
B Agent for application to the outstanding principal amount of Term B Debt,
until paid in full; provided, that, any such proceeds that would be applied to
cash collateralize the US Letters of Credit pursuant to clause second above may
be retained by Borrowers to the extent US Availability, after giving effect to
such sale, disposition or casualty, would be greater than $0 notwithstanding the
failure to cash collateralize such US Letters of Credit, and (y) the remaining
proceeds shall be applied, first, to the outstanding principal amount of Term
Loan A, until paid in full and second, unless such prepayment requirement shall
have been waived under the Term B Debt Documents, paid to Term B Agent for
application to the outstanding principal amount of Term B Debt, until paid in
full.  Each such prepayment of the Term Loan A shall be

 

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without penalty or premium and shall be applied against the remaining
installments of principal of the Term Loan A in the inverse order of maturity;
and

 

(4)                                  subject to clauses (1), (2) and (3) above,
any other prepayment pursuant to subclauses (c)(ii) and (iii) above shall, be
applied, first, to the outstanding principal amount of Term Loan A, until paid
in full, and second, unless such prepayment requirement shall have been waived
under the Term B Debt Documents, paid to Term B Agent for application to the
outstanding principal amount of Term B Debt, until paid in full.  Each such
prepayment of the Term Loan A shall be without penalty or premium and shall be
applied against the remaining installments of principal of the Term Loan A in
the inverse order of maturity; and

 

(5)                                  if an Event of Default shall have occurred
and be continuing, (x) at Administrative Agent’s election, any payment to be
paid to Term B Agent for application to the outstanding principal amount of Term
B Debt shall be applied in the manner set forth in Section 2.4(b)(i)(A) and
(y) at Administrative Agent’s election, any prepayment of the Obligations
required pursuant to subclause (c)(ii) or (c)(iii) above shall be applied in the
manner set forth in Section 2.4(b)(i)(A).

 

(III)                               EACH PREPAYMENT PURSUANT TO SUBCLAUSE
(C)(IV) ABOVE (ISSUANCE OF STOCK OR INCURRENCE OF INDEBTEDNESS) SHALL FIRST, BE
APPLIED TO THE OUTSTANDING PRINCIPAL AMOUNT OF TERM LOAN A, UNTIL PAID IN FULL,
AND SECOND, UNLESS SUCH PREPAYMENT REQUIREMENT SHALL HAVE BEEN WAIVED UNDER THE
TERM B DEBT DOCUMENTS, PAID TO TERM B AGENT FOR APPLICATION TO THE OUTSTANDING
PRINCIPAL AMOUNT OF TERM B DEBT, UNTIL PAID IN FULL; PROVIDED, THAT IF AN EVENT
OF DEFAULT SHALL HAVE OCCURRED AND BE CONTINUING, (X) AT ADMINISTRATIVE AGENT’S
ELECTION, ANY PAYMENT TO BE PAID TO TERM B AGENT FOR APPLICATION TO THE
OUTSTANDING PRINCIPAL AMOUNT OF TERM B DEBT SHALL BE APPLIED IN THE MANNER SET
FORTH IN SECTION 2.4(B)(I)(A) AND (Y) AT ADMINISTRATIVE AGENT’S ELECTION, ANY
PREPAYMENT OF THE TERM LOAN A REQUIRED PURSUANT TO SUBCLAUSE (C)(IV) ABOVE SHALL
BE APPLIED IN THE MANNER SET FORTH IN SECTION 2.4(B)(I)(A).  EACH SUCH
PREPAYMENT OF THE TERM LOAN A SHALL BE WITHOUT PENALTY OR PREMIUM AND SHALL BE
APPLIED AGAINST THE REMAINING INSTALLMENTS OF PRINCIPAL OF THE TERM LOAN A IN
THE INVERSE ORDER OF MATURITY.

 

(IV)                              EACH PREPAYMENT PURSUANT TO SUBCLAUSE
(C)(V) (LEVERAGE) ABOVE SHALL BE APPLIED, FIRST, TO OUTSTANDING PRINCIPAL AMOUNT
OF THE US ADVANCES, SECOND, TO CASH COLLATERALIZE THE US LETTERS OF CREDIT IN AN
AMOUNT EQUAL TO 105% AT THE THEN EXTANT US LETTER OF CREDIT USAGE, UNTIL CASH
COLLATERALIZED IN FULL, THIRD, TO THE OUTSTANDING PRINCIPAL BALANCE OF TERM
LOAN A, UNTIL PAID IN FULL, AND FOURTH, UNLESS SUCH PREPAYMENT REQUIREMENT SHALL
HAVE BEEN WAIVED UNDER THE TERM B DEBT DOCUMENTS, PAID TO TERM B AGENT FOR
APPLICATION TO THE OUTSTANDING PRINCIPAL AMOUNT OF TERM B DEBT, UNTIL PAID IN
FULL; PROVIDED, THAT IF AN EVENT OF DEFAULT SHALL HAVE OCCURRED AND BE
CONTINUING, (X) AT ADMINISTRATIVE

 

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AGENT’S ELECTION, ANY PAYMENT TO BE PAID TO TERM B AGENT FOR APPLICATION TO THE
OUTSTANDING PRINCIPAL AMOUNT OF TERM B DEBT SHALL BE APPLIED IN THE MANNER SET
FORTH IN SECTION 2.4(B)(I)(A) AND (Y) AT ADMINISTRATIVE AGENT’S ELECTION, ANY
PREPAYMENT OF THE OBLIGATIONS REQUIRED PURSUANT TO SUBCLAUSE (C)(V) ABOVE SHALL
BE APPLIED IN THE MANNER SET FORTH IN SECTION 2.4(B)(I)(A).  EACH PREPAYMENT OF
TERM LOAN A SHALL BE WITHOUT PENALTY OR PREMIUM.  EACH PREPAYMENT SHALL BE
APPLIED AGAINST THE REMAINING INSTALLMENTS OF PRINCIPAL OF THE TERM LOAN A IN
THE INVERSE ORDER OF MATURITY.  WITH RESPECT TO ANY PREPAYMENT REQUIRED UNDER
SECTION 2.4(C)(V), ADMINISTRATIVE AGENT SHALL ESTABLISH AND MAINTAIN A RESERVE
AGAINST THE US BORROWING BASE AND THE MAXIMUM REVOLVER AMOUNT IN AN AMOUNT EQUAL
TO SUCH PREPAYMENT APPLIED TO THE PRINCIPAL AMOUNT OF THE ADVANCES (THE
“LEVERAGE RESERVE”).  ADMINISTRATIVE AGENT SHALL MAINTAIN THE LEVERAGE RESERVE
UNTIL SUCH TIME AS NO EVENT OF DEFAULT EXISTS AND (A) THE SUM OF THE REVOLVER
USAGE (EXCLUDING LETTER OF CREDIT USAGE CASH COLLATERALIZED IN AN AMOUNT UP TO
105% OF SUCH LETTER OF CREDIT USAGE), THE OUTSTANDING PRINCIPAL BALANCE OF TERM
LOAN A AND THE LEVERAGE RESERVE IS LESS THAN 2.25 TIMES THE AMOUNT OF EBITDA FOR
THE MOST RECENTLY ENDED 12 MONTH PERIOD, (B) THE SUM OF THE REVOLVER USAGE
(EXCLUDING LETTER OF CREDIT USAGE CASH COLLATERALIZED IN AN AMOUNT UP TO 105% OF
SUCH LETTER OF CREDIT USAGE) AND THE OUTSTANDING PRINCIPAL BALANCE OF TERM LOAN
A AND THE TERM B DEBT AND THE LEVERAGE RESERVE IS LESS THAN 2.75 TIMES THE
AMOUNT OF EBITDA FOR THE MOST RECENTLY ENDED 12 MONTH PERIOD AND (C) THE SUM OF
THE REVOLVER USAGE (EXCLUDING LETTER OF CREDIT USAGE CASH COLLATERALIZED IN AN
AMOUNT UP TO 105% OF SUCH LETTER OF CREDIT USAGE), THE OUTSTANDING PRINCIPAL
BALANCE OF TERM LOAN A AND THE TERM B DEBT, THE AGGREGATE PRINCIPAL AMOUNT OF
ALL OTHER INDEBTEDNESS (OTHER THAN CASH COLLATERALIZED LETTERS OF CREDIT) OF
PARENT AND ITS SUBSIDIARIES OUTSTANDING AS OF SUCH DATE IN THE AMOUNT THAT WOULD
BE REFLECTED AS DEBT ON A BALANCE SHEET PREPARED AS OF SUCH DATE ON A
CONSOLIDATED BASIS IN ACCORDANCE WITH GAAP AND THE LEVERAGE RESERVE IS LESS THAN
3 TIMES THE AMOUNT OF EBITDA FOR THE MOST RECENTLY ENDED 12 MONTH PERIOD.

 

(V)                                 NOTWITHSTANDING ANYTHING TO THE CONTRARY
CONTAINED IN THIS SECTION 2.4(D), IF THE DOLLAR EQUIVALENT OF EXCESS
AVAILABILITY WOULD BE LESS THAN OR EQUAL TO $25,000,000 (OR, AT ANY TIME AFTER
THE TERM LOAN A HAS BEEN REPAID IN FULL, $20,000,000) IMMEDIATELY AFTER GIVING
EFFECT TO ANY PREPAYMENT THAT IS REQUIRED TO BE PAID TO THE TERM B AGENT
PURSUANT TO ANY PROVISION OF THIS SECTION 2.4(D), NO SUCH PREPAYMENT SHALL BE
PAID TO THE TERM B AGENT AND (X) ADMINISTRATIVE AGENT SHALL APPLY SUCH AMOUNTS
TO THE PAYMENT OF THE US ADVANCES AND, CONCURRENTLY WITH SUCH PAYMENT OF THE US
ADVANCES, A CORRESPONDING RESERVE SHALL BE ESTABLISHED AND MAINTAINED AGAINST
THE US BORROWING BASE AND THE MAXIMUM US REVOLVER AMOUNT IN AN AMOUNT EQUAL TO
THE AMOUNT THAT WOULD HAVE OTHERWISE BEEN REQUIRED TO BE PAID BY US BORROWERS TO
THE TERM B AGENT, AND (Y) THE AMOUNT THAT WAS APPLIED TO THE US ADVANCES
PURSUANT TO SUBCLAUSE (X) SHALL BE PAID TO THE TERM B AGENT FOR APPLICATION TO
THE OUTSTANDING PRINCIPAL AMOUNT OF TERM B DEBT, AND THE CORRESPONDING RESERVE
AGAINST THE US BORROWING BASE AND THE MAXIMUM US REVOLVER AMOUNT SHALL BE
RELEASED, ONCE THE DOLLAR EQUIVALENT OF EXCESS AVAILABILITY WOULD BE GREATER
THAN $25,000,000 (OR, AT ANY TIME AFTER THE TERM LOAN A HAS BEEN REPAID IN FULL,
$20,000,000) IMMEDIATELY AFTER GIVING EFFECT TO SUCH PREPAYMENT OF THE TERM B
DEBT SO LONG AS NO EVENT OF DEFAULT THEN EXISTS.

 

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2.5.                            OVERADVANCES.

 

If, at any time or for any reason, the amount of US Revolver Usage owed by US
Borrowers to the Lender Group pursuant to Section 2.1 or Section 2.12 is greater
than any of the limitations set forth in Section 2.1 or Section 2.12, as
applicable (an “US Overadvance”), the applicable US Borrowers immediately shall
pay to Administrative Agent, in cash, the amount of such excess, which amount
shall be used by Administrative Agent to reduce US Revolver Usage in accordance
with the priorities set forth in Section 2.4(b).  If, at any time or for any
reason, the amount of Canadian Revolver Usage owed by Canadian Borrowers to the
Lender Group pursuant to Section 2.1 or Section 2.12 is greater than any of the
limitations set forth in Section 2.1 or Section 2.12, as applicable (a “Canadian
Overadvance”), the applicable Canadian Borrowers immediately shall pay to
Canadian Administrative Agent, in cash, the amount of such excess, which amount
shall be used by Canadian Administrative Agent to reduce the Canadian Revolver
Usage in accordance with the priorities set forth in Section 2.4(b).  If, at any
time or for any reason, the amount of European Revolver Usage owed by European
Borrowers to the Lender Group pursuant to Section 2.1 or Section 2.12 is greater
than any of the limitations set forth in Section 2.1 or Section 2.12, as
applicable (an “European Overadvance”; US Overadvances, Canadian Overadvances
and European Overadvances are collectively, the “Overadvances”), the applicable
European Borrowers immediately shall pay to European Administrative Agent, in
cash, the amount of such excess, which amount shall be used by European
Administrative Agent to reduce the European Revolver Usage in accordance with
the priorities set forth in Section 2.4(b).  In addition, US Borrowers hereby
promise to pay the US Obligations (including principal, interest, fees, costs,
and expenses) in the Applicable Currency in full and Foreign Borrowers hereby
promise to pay the Foreign Obligations (including principal, interest, fees,
costs, and expenses) in the Applicable Currency in full, in each case as and
when due and payable under the terms of this Agreement and the other Loan
Documents.

 

2.6.                            INTEREST RATES AND LETTER OF CREDIT FEE:  RATES,
PAYMENTS, AND CALCULATIONS.

 

(A)                                  INTEREST RATES.  EXCEPT AS PROVIDED IN
CLAUSE (C) BELOW, ALL OBLIGATIONS (EXCEPT FOR UNDRAWN LETTERS OF CREDIT AND
EXCEPT FOR BANK PRODUCT OBLIGATIONS) WHETHER OR NOT CHARGED TO THE LOAN ACCOUNTS
PURSUANT TO THE TERMS HEREOF SHALL BEAR INTEREST ON THE DAILY BALANCE THEREOF AS
FOLLOWS (I) IF THE RELEVANT OBLIGATION IS AN ADVANCE (WHETHER A US ADVANCE,
CANADIAN ADVANCE OR EUROPEAN ADVANCE) DENOMINATED IN DOLLARS THAT IS A LIBOR
RATE LOAN, AT A PER ANNUM RATE EQUAL TO THE US LIBOR RATE PLUS THE LIBOR RATE
MARGIN, (II) IF THE RELEVANT OBLIGATION IS A CANADIAN ADVANCE DENOMINATED IN
CANADIAN DOLLARS THAT IS A LIBOR RATE LOAN, SUBJECT TO SECTION 2.16, AT A PER
ANNUM RATE EQUAL TO THE CANADIAN LIBOR RATE PLUS THE LIBOR RATE MARGIN, (III) IF
THE RELEVANT OBLIGATION IS AN ADVANCE (WHETHER A US ADVANCE OR EUROPEAN ADVANCE)
THAT IS AN OFFSHORE CURRENCY RATE LOAN, AT A PER ANNUM RATE EQUAL TO THE
APPLICABLE APPROVED OFFSHORE CURRENCY RATE PLUS THE LIBOR RATE MARGIN, (IV) IF
THE RELEVANT OBLIGATION IS A PORTION OF THE TERM LOAN A THAT IS A LIBOR RATE
LOAN, AT A PER ANNUM RATE EQUAL TO THE US LIBOR RATE PLUS THE LIBOR RATE TERM
LOAN A MARGIN, (V) IF THE RELEVANT OBLIGATION IS A PORTION OF THE TERM LOAN A
THAT IS A BASE RATE LOAN, AT A PER ANNUM RATE EQUAL TO THE US BASE RATE PLUS THE
BASE RATE TERM LOAN A

 

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MARGIN, (VI) IF THE RELEVANT OBLIGATION IS A CANADIAN ADVANCE DENOMINATED IN
CANADIAN DOLLARS THAT IS A BASE RATE LOAN, SUBJECT TO SECTION 2.16, AT A PER
ANNUM RATE EQUAL TO THE CANADIAN BASE RATE PLUS THE BASE RATE MARGIN, AND
(VII) OTHERWISE WITH RESPECT TO ADVANCES AND OTHER AMOUNTS CORRESPONDING TO
PRINCIPAL, AT A PER ANNUM RATE EQUAL TO THE US BASE RATE PLUS THE BASE RATE
MARGIN.

 

The foregoing notwithstanding, at no time shall any portion of the Obligations
(other than Bank Product Obligations) bear interest on the Daily Balance thereof
at a per annum rate less than 3%.  To the extent that interest accrued hereunder
at the rate set forth herein would be less than the foregoing minimum daily
rate, the interest rate chargeable hereunder for such day automatically shall be
deemed increased to the minimum rate.

 

(B)                                 LETTER OF CREDIT FEE.

 

(I)                                     US BORROWERS SHALL PAY ADMINISTRATIVE
AGENT (FOR THE RATABLE BENEFIT OF THE LENDERS WITH A US REVOLVER COMMITMENT), A
LETTER OF CREDIT FEE (IN ADDITION TO THE CHARGES, COMMISSIONS, FEES, AND COSTS
SET FORTH IN SECTION 2.12(A)(V)) WHICH SHALL ACCRUE AT A RATE EQUAL TO 2% PER
ANNUM TIMES THE DAILY BALANCE OF THE UNDRAWN AMOUNT OF ALL OUTSTANDING US
LETTERS OF CREDIT.

 

(II)                                  CANADIAN BORROWERS SHALL PAY CANADIAN
ADMINISTRATIVE AGENT (FOR THE RATABLE BENEFIT OF THE LENDERS WITH A CANADIAN
REVOLVER COMMITMENT), A LETTER OF CREDIT FEE (IN ADDITION TO THE CHARGES,
COMMISSIONS, FEES, AND COSTS SET FORTH IN SECTION 2.12(B)(V)) WHICH SHALL ACCRUE
AT A RATE EQUAL TO 2% PER ANNUM TIMES THE DAILY BALANCE OF THE UNDRAWN AMOUNT OF
ALL OUTSTANDING CANADIAN LETTERS OF CREDIT.

 

(III)                               EUROPEAN BORROWERS SHALL PAY EUROPEAN
ADMINISTRATIVE AGENT (FOR THE RATABLE BENEFIT OF THE LENDERS WITH A EUROPEAN
REVOLVER COMMITMENT), A LETTER OF CREDIT FEE (IN ADDITION TO THE CHARGES,
COMMISSIONS, FEES, AND COSTS SET FORTH IN SECTION 2.12(C)(V)) WHICH SHALL ACCRUE
AT A RATE EQUAL TO 2% PER ANNUM TIMES THE DAILY BALANCE OF THE UNDRAWN AMOUNT OF
ALL OUTSTANDING EUROPEAN LETTERS OF CREDIT.

 

(C)                                  DEFAULT RATE.  UPON THE OCCURRENCE AND
DURING THE CONTINUATION OF AN EVENT OF DEFAULT,

 

(I)                                     AT THE ELECTION OF ADMINISTRATIVE AGENT
OR THE REQUIRED LENDERS, ALL OBLIGATIONS (EXCEPT FOR UNDRAWN LETTERS OF CREDIT
AND EXCEPT FOR BANK PRODUCT OBLIGATIONS) WHETHER OR NOT CHARGED TO A LOAN
ACCOUNT PURSUANT TO THE TERMS HEREOF SHALL BEAR INTEREST ON THE DAILY BALANCE
THEREOF AT A PER ANNUM RATE EQUAL TO 200 BASIS POINTS ABOVE THE PER ANNUM RATE
OTHERWISE APPLICABLE HEREUNDER, AND

 

(II)                                  AT THE ELECTION OF ADMINISTRATIVE AGENT OR
THE REQUIRED LENDERS, THE LETTER OF CREDIT FEE PROVIDED FOR ABOVE SHALL BE
INCREASED TO 200 BASIS POINTS ABOVE THE PER ANNUM RATE OTHERWISE APPLICABLE
HEREUNDER.

 

(D)                                 PAYMENT.  EXCEPT AS PROVIDED TO THE CONTRARY
IN SECTION 2.11 OR SECTION 2.13(A), INTEREST, LETTER OF CREDIT FEES, AND ALL
OTHER FEES PAYABLE HEREUNDER SHALL BE

 

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DUE AND PAYABLE, IN ARREARS, ON THE FIRST BUSINESS DAY OF EACH MONTH AT ANY TIME
THAT OBLIGATIONS OR COMMITMENTS ARE OUTSTANDING.  US BORROWERS HEREBY AUTHORIZE
ADMINISTRATIVE AGENT, FROM TIME TO TIME, WITHOUT PRIOR NOTICE TO BORROWERS, TO
CHARGE ALL INTEREST AND FEES (WHEN DUE AND PAYABLE), ALL LENDER GROUP EXPENSES
(AS AND WHEN INCURRED), ALL CHARGES, COMMISSIONS, FEES, AND COSTS PROVIDED FOR
IN SECTION 2.12(A)(V) (AS AND WHEN ACCRUED OR INCURRED), ALL FEES AND COSTS
PROVIDED FOR IN SECTION 2.11 (AS AND WHEN ACCRUED OR INCURRED), AND ALL OTHER
PAYMENTS AS AND WHEN DUE AND PAYABLE UNDER ANY LOAN DOCUMENT (INCLUDING THE
AMOUNTS DUE AND PAYABLE WITH RESPECT TO THE TERM LOAN A AND INCLUDING ANY
AMOUNTS DUE AND PAYABLE TO THE BANK PRODUCT PROVIDERS IN RESPECT OF BANK
PRODUCTS UP TO THE AMOUNT OF THE BANK PRODUCT RESERVE), IN EACH CASE
ATTRIBUTABLE TO THE US BORROWERS TO THE US LOAN ACCOUNT, WHICH AMOUNTS
THEREAFTER SHALL CONSTITUTE US ADVANCES HEREUNDER AND, TO THE EXTENT SUCH
AMOUNTS ARE DENOMINATED IN DOLLARS, SHALL ACCRUE INTEREST AT THE RATE THEN
APPLICABLE TO US ADVANCES THAT ARE BASE RATE LOANS DENOMINATED IN DOLLARS
HEREUNDER AND, TO THE EXTENT SUCH AMOUNTS ARE DENOMINATED IN AN APPROVED
OFFSHORE CURRENCY, SHALL ACCRUE INTEREST AT THE RATE THEN APPLICABLE TO US
ADVANCES THAT ARE LIBOR RATE LOANS DENOMINATED IN SUCH APPROVED OFFSHORE
CURRENCY WITH AN INTEREST PERIOD OF ONE MONTH’S DURATION HEREUNDER.  CANADIAN
BORROWERS HEREBY AUTHORIZE CANADIAN ADMINISTRATIVE AGENT, FROM TIME TO TIME,
WITHOUT PRIOR NOTICE TO BORROWERS, TO CHARGE ALL INTEREST AND FEES (WHEN DUE AND
PAYABLE) OWED BY CANADIAN BORROWERS, ALL LENDER GROUP EXPENSES (AS AND WHEN
INCURRED) OWED BY CANADIAN BORROWERS, ALL CHARGES, COMMISSIONS, FEES, AND COSTS
PROVIDED FOR IN SECTION 2.12(B)(V) (AS AND WHEN ACCRUED OR INCURRED), ALL FEES
AND COSTS PROVIDED FOR IN SECTION 2.11 (AS AND WHEN ACCRUED OR INCURRED) OWED BY
CANADIAN BORROWERS, AND ALL OTHER PAYMENTS AS AND WHEN DUE AND PAYABLE UNDER ANY
LOAN DOCUMENT BY CANADIAN BORROWERS TO THE CANADIAN LOAN ACCOUNT, WHICH AMOUNTS
THEREAFTER SHALL CONSTITUTE CANADIAN ADVANCES HEREUNDER AND SHALL ACCRUE
INTEREST AT THE RATE THEN APPLICABLE TO CANADIAN ADVANCES THAT ARE BASE RATE
LOANS DENOMINATED IN THE APPLICABLE CURRENCY HEREUNDER.  EUROPEAN BORROWERS
HEREBY AUTHORIZE EUROPEAN ADMINISTRATIVE AGENT, FROM TIME TO TIME, WITHOUT PRIOR
NOTICE TO BORROWERS, TO CHARGE ALL INTEREST AND FEES (WHEN DUE AND PAYABLE) OWED
BY EUROPEAN BORROWERS, ALL LENDER GROUP EXPENSES (AS AND WHEN INCURRED) OWED BY
EUROPEAN BORROWERS, ALL CHARGES, COMMISSIONS, FEES, AND COSTS PROVIDED FOR IN
SECTION 2.12(C)(V) (AS AND WHEN ACCRUED OR INCURRED), ALL FEES AND COSTS
PROVIDED FOR IN SECTION 2.11 (AS AND WHEN ACCRUED OR INCURRED) OWED BY EUROPEAN
BORROWERS, AND ALL OTHER PAYMENTS AS AND WHEN DUE AND PAYABLE UNDER ANY LOAN
DOCUMENT BY EUROPEAN BORROWERS TO THE EUROPEAN LOAN ACCOUNT, WHICH AMOUNTS
THEREAFTER SHALL CONSTITUTE EUROPEAN ADVANCES HEREUNDER AND, TO THE EXTENT SUCH
AMOUNTS ARE DENOMINATED IN DOLLARS, SHALL ACCRUE INTEREST AT THE RATE THEN
APPLICABLE TO EUROPEAN ADVANCES THAT ARE BASE RATE LOANS DENOMINATED IN DOLLARS
HEREUNDER AND, TO THE EXTENT SUCH AMOUNTS ARE DENOMINATED IN AN APPROVED
OFFSHORE CURRENCY, SHALL ACCRUE INTEREST AT THE RATE THEN APPLICABLE TO EUROPEAN
ADVANCES THAT ARE LIBOR RATE LOANS DENOMINATED IN SUCH APPROVED OFFSHORE
CURRENCY WITH AN INTEREST PERIOD OF ONE MONTH’S DURATION HEREUNDER.  TO THE
EXTENT PERMITTED BY LAW, (I) ANY INTEREST WITH RESPECT TO US OBLIGATIONS THAT IS
NOT PAID WHEN DUE SHALL BE COMPOUNDED BY BEING CHARGED TO THE APPLICABLE
BORROWERS’ LOAN ACCOUNT AND SHALL THEREAFTER CONSTITUTE US ADVANCES TO SUCH
BORROWERS HEREUNDER AND SHALL ACCRUE INTEREST AT THE RATE THEN APPLICABLE TO US
ADVANCES THAT ARE BASE RATE LOANS DENOMINATED IN DOLLARS HEREUNDER, (II) ANY
INTEREST WITH RESPECT TO FOREIGN OBLIGATIONS OWED BY CANADIAN BORROWERS THAT IS
NOT PAID WHEN DUE

 

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SHALL BE COMPOUNDED BY BEING CHARGED TO THE APPLICABLE BORROWERS’ LOAN ACCOUNT
AND SHALL THEREAFTER CONSTITUTE CANADIAN ADVANCES TO SUCH BORROWERS HEREUNDER
AND SHALL ACCRUE INTEREST AT THE RATE THEN APPLICABLE TO CANADIAN ADVANCES THAT
ARE BASE RATE LOANS DENOMINATED IN THE APPLICABLE CURRENCY HEREUNDER AND
(III) ANY INTEREST WITH RESPECT TO FOREIGN OBLIGATIONS OWED BY EUROPEAN
BORROWERS THAT IS NOT PAID WHEN DUE SHALL BE COMPOUNDED BY BEING CHARGED TO THE
APPLICABLE BORROWERS’ LOAN ACCOUNT AND SHALL THEREAFTER CONSTITUTE EUROPEAN
ADVANCES TO SUCH BORROWERS HEREUNDER AND, TO THE EXTENT SUCH AMOUNTS ARE
DENOMINATED IN DOLLARS, SHALL ACCRUE INTEREST AT THE RATE THEN APPLICABLE TO
EUROPEAN ADVANCES THAT ARE BASE RATE LOANS DENOMINATED IN DOLLARS HEREUNDER AND,
TO THE EXTENT SUCH AMOUNTS ARE DENOMINATED IN AN APPROVED OFFSHORE CURRENCY,
SHALL ACCRUE INTEREST AT THE RATE THEN APPLICABLE TO EUROPEAN ADVANCES THAT ARE
LIBOR RATE LOANS DENOMINATED IN SUCH APPROVED OFFSHORE CURRENCY WITH AN INTEREST
PERIOD OF ONE MONTH’S DURATION HEREUNDER.

 

(E)                                  COMPUTATION.  SUBJECT TO THE INTEREST ACT
(CANADA) AND SECTION 2.16, ALL INTEREST AND FEES CHARGEABLE UNDER THE LOAN
DOCUMENTS SHALL BE COMPUTED ON THE BASIS OF A 360 DAY YEAR FOR THE ACTUAL NUMBER
OF DAYS ELAPSED.  IN THE EVENT THE BASE RATE IS CHANGED FROM TIME TO TIME
HEREAFTER, THE RATES OF INTEREST HEREUNDER BASED UPON THE BASE RATE
AUTOMATICALLY AND IMMEDIATELY SHALL BE INCREASED OR DECREASED BY AN AMOUNT EQUAL
TO SUCH CHANGE IN THE BASE RATE.

 

(F)                                    INTENT TO LIMIT CHARGES TO MAXIMUM LAWFUL
RATE.  IN NO EVENT SHALL THE INTEREST RATE OR RATES PAYABLE UNDER THIS
AGREEMENT, PLUS ANY FEES, CHARGES, COSTS AND PAYMENTS CONSTRUED TO BE EQUIVALENT
TO INTEREST AND ANY OTHER AMOUNTS PAID IN CONNECTION HEREWITH, EXCEED THE
HIGHEST RATE PERMISSIBLE UNDER ANY LAW THAT A COURT OF COMPETENT JURISDICTION
SHALL, IN A FINAL DETERMINATION, DEEM APPLICABLE.  BORROWERS AND THE LENDER
GROUP, IN EXECUTING AND DELIVERING THIS AGREEMENT, INTEND LEGALLY TO AGREE UPON
THE RATE OR RATES OF INTEREST AND MANNER OF PAYMENT STATED WITHIN IT; PROVIDED,
HOWEVER, THAT, ANYTHING CONTAINED HEREIN TO THE CONTRARY NOTWITHSTANDING, IF
SAID RATE OR RATES OF INTEREST OR MANNER OF PAYMENT EXCEEDS THE MAXIMUM
ALLOWABLE UNDER APPLICABLE LAW, THEN, IPSO FACTO, AS OF THE DATE OF THIS
AGREEMENT, BORROWERS ARE AND SHALL BE LIABLE ONLY FOR THE PAYMENT OF SUCH
MAXIMUM AS ALLOWED BY LAW, AND PAYMENT RECEIVED FROM BORROWERS IN EXCESS OF SUCH
LEGAL MAXIMUM, WHENEVER RECEIVED, SHALL BE APPLIED TO REDUCE THE PRINCIPAL
BALANCE OF THE OBLIGATIONS TO THE EXTENT OF SUCH EXCESS.

 

2.7.                            CASH MANAGEMENT.

 

(A)                                  BORROWERS SHALL (I) ESTABLISH AND MAINTAIN
CASH MANAGEMENT SERVICES OF A TYPE AND ON TERMS REASONABLY SATISFACTORY TO
COLLATERAL AGENT AT ONE OR MORE OF THE BANKS SET FORTH ON SCHEDULE 2.7(A) AS
AMENDED OR MODIFIED FROM TIME TO TIME PURSUANT TO CLAUSE (C) BELOW (EACH A “CASH
MANAGEMENT BANK”), AND SHALL REQUEST IN WRITING AND OTHERWISE TAKE SUCH
REASONABLE STEPS TO ENSURE THAT ALL OF THEIR ACCOUNT DEBTORS FORWARD PAYMENT OF
THE AMOUNTS OWED BY THEM DIRECTLY TO SUCH CASH MANAGEMENT BANKS, AND
(II) DEPOSIT OR CAUSE TO BE DEPOSITED PROMPTLY, AND IN ANY EVENT NO LATER THAN
THE FIRST BUSINESS DAY AFTER THE DATE OF RECEIPT THEREOF, ALL OF THEIR
COLLECTIONS FROM ACCOUNT DEBTORS (INCLUDING THOSE SENT DIRECTLY

 

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BY THEIR ACCOUNT DEBTORS TO BORROWERS) INTO A BANK ACCOUNT (A “CASH MANAGEMENT
ACCOUNT”) AT ONE OF THE CASH MANAGEMENT BANKS.

 

(B)                                 EACH CASH MANAGEMENT BANK SHALL ESTABLISH
AND MAINTAIN CASH MANAGEMENT AGREEMENTS, IN FORM AND SUBSTANCE REASONABLY
ACCEPTABLE TO COLLATERAL AGENT.  UNLESS THE COLLATERAL AGENT OTHERWISE AGREES,
EACH SUCH CASH MANAGEMENT AGREEMENT SHALL PROVIDE, AMONG OTHER THINGS, THAT
(I) AT ANY TIME AFTER NOTICE FROM COLLATERAL AGENT AND PRIOR TO THE RESCINDING
OF SUCH NOTICE, THE CASH MANAGEMENT BANK WILL COMPLY WITH ANY INSTRUCTIONS
ORIGINATED BY COLLATERAL AGENT DIRECTING THE DISPOSITION OF THE FUNDS IN SUCH
CASH MANAGEMENT ACCOUNT WITHOUT FURTHER CONSENT BY BORROWERS, (II) THE CASH
MANAGEMENT BANK HAS NO RIGHTS OF SETOFF OR RECOUPMENT OR ANY OTHER CLAIM AGAINST
THE APPLICABLE CASH MANAGEMENT ACCOUNT, OTHER THAN FOR PAYMENT OF ITS SERVICE
FEES AND OTHER CHARGES DIRECTLY RELATED TO THE ADMINISTRATION OF SUCH CASH
MANAGEMENT ACCOUNT AND FOR RETURNED CHECKS OR OTHER ITEMS OF PAYMENT, AND
(III) AT ANY TIME AFTER NOTICE FROM COLLATERAL AGENT AND PRIOR TO THE RESCINDING
OF SUCH NOTICE, IT WILL FORWARD BY DAILY SWEEP ALL AMOUNTS IN THE APPLICABLE
CASH MANAGEMENT ACCOUNT TO THE APPLICABLE AGENT’S ACCOUNT; PROVIDED THAT, UNLESS
(Y) AN ENFORCEMENT EVENT UNDER AND AS SUCH TERM IS DEFINED IN THE GERMAN ACCOUNT
PLEDGE AGREEMENTS DATED ON OR ABOUT THE DATE HEREOF ENTERED INTO OR TO BE
ENTERED INTO BETWEEN EACH OF THE GERMAN BORROWERS AND THE COLLATERAL AGENT IN
CONNECTION WITH THIS AGREEMENT HAS OCCURRED, OR (X) AN EVENT OF DEFAULT OF A
GERMAN BORROWER HAS OCCURRED AND IS CONTINUING WHICH EVENT OF DEFAULT WAS NOT
CAUSED SOLELY BY AN ACT OR OMISSION TO ACT OF A BORROWER OTHER THAN THE GERMAN
BORROWERS THROUGH A CROSS DEFAULT PROVISION UNDER THIS AGREEMENT, THE COLLATERAL
AGENT SHALL NOT BE ENTITLED TO PROVIDE ANY NOTICE REFERRED TO IN CLAUSE (I) OR
CLAUSE (III) ABOVE PURSUANT TO ANY CASH MANAGEMENT AGREEMENT TO WHICH SUCH
GERMAN BORROWER IS A PARTY IF SUCH GERMAN BORROWER PROVES TO THE REASONABLE
SATISFACTION OF THE COLLATERAL AGENT THAT SUCH NOTICE WOULD CONSTITUTE OR RESULT
IN AN INTERFERENCE DESTROYING THE EXISTENCE (EXISTENZVERNICHTENDER EINGRIFF) OF
SUCH GERMAN BORROWER.  COLLATERAL AGENT AGREES THAT AT ANY TIME PRIOR TO THE
OCCURRENCE OF A CASH MANAGEMENT TRIGGERING EVENT AND AT ANY TIME AFTER THE
OCCURRENCE OF A SUBSEQUENT CASH MANAGEMENT REINSTATEMENT EVENT (TO THE EXTENT NO
SUBSEQUENT CASH MANAGEMENT TRIGGERING EVENT HAS OCCURRED), COLLATERAL AGENT
SHALL INSTRUCT THE CASH MANAGEMENT BANKS TO DIRECT THE FUNDS IN THE CASH
MANAGEMENT ACCOUNTS TO SUCH DEPOSIT ACCOUNTS OF BORROWERS AS COLLATERAL AGENT IS
DIRECTED BY ADMINISTRATIVE BORROWER.  AFTER THE OCCURRENCE OF A CASH MANAGEMENT
REINSTATEMENT EVENT, COLLATERAL AGENT FURTHER AGREES TO PROMPTLY NOTIFY EACH
CASH MANAGEMENT BANK OF THE OCCURRENCE OF SUCH CASH MANAGEMENT REINSTATEMENT
EVENT AND THAT SUCH CASH MANAGEMENT BANK MAY RESUME DIRECTING THE FUNDS IN THE
CASH MANAGEMENT ACCOUNTS TO SUCH DEPOSIT ACCOUNTS OF BORROWERS AS DIRECTED BY
ADMINISTRATIVE BORROWER.

 

(C)                                  SO LONG AS NO EVENT OF DEFAULT HAS OCCURRED
AND IS CONTINUING, ADMINISTRATIVE BORROWER MAY AMEND SCHEDULE 2.7(A) TO ADD OR
REPLACE A CASH MANAGEMENT BANK OR CASH MANAGEMENT ACCOUNT; PROVIDED, HOWEVER,
THAT (I) SUCH PROSPECTIVE CASH MANAGEMENT BANK SHALL BE REASONABLY SATISFACTORY
TO COLLATERAL AGENT, AND (II) PRIOR TO THE TIME OF THE OPENING OF SUCH CASH
MANAGEMENT ACCOUNT, THE APPLICABLE BORROWER AND SUCH PROSPECTIVE CASH MANAGEMENT
BANK SHALL HAVE EXECUTED AND DELIVERED TO COLLATERAL AGENT A CASH MANAGEMENT
AGREEMENT.  BORROWERS SHALL CLOSE ANY OF THEIR CASH MANAGEMENT

 

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ACCOUNTS (AND ESTABLISH REPLACEMENT CASH MANAGEMENT ACCOUNTS IN ACCORDANCE WITH
THE FOREGOING SENTENCE) PROMPTLY AND IN ANY EVENT WITHIN 60 DAYS OF NOTICE FROM
COLLATERAL AGENT (OR SUCH LONGER PERIOD AS ADMINISTRATIVE BORROWER AND
COLLATERAL AGENT MAY AGREE) THAT THE CREDITWORTHINESS OF ANY CASH MANAGEMENT
BANK IS NO LONGER ACCEPTABLE IN COLLATERAL AGENT’S REASONABLE JUDGMENT, OR AS
PROMPTLY AS PRACTICABLE AND IN ANY EVENT WITHIN 90 DAYS OF NOTICE FROM
COLLATERAL AGENT (OR SUCH LONGER PERIOD AS ADMINISTRATIVE BORROWER AND
ADMINISTRATIVE AGENT MAY AGREE) THAT THE OPERATING PERFORMANCE, FUNDS TRANSFER,
OR AVAILABILITY PROCEDURES OR PERFORMANCE OF THE CASH MANAGEMENT BANK WITH
RESPECT TO CASH MANAGEMENT ACCOUNTS OR COLLATERAL AGENT’S LIABILITY UNDER ANY
CASH MANAGEMENT AGREEMENT WITH SUCH CASH MANAGEMENT BANK IS NO LONGER ACCEPTABLE
IN ADMINISTRATIVE AGENT’S REASONABLE JUDGMENT.

 

(D)                                 THE CASH MANAGEMENT ACCOUNTS SHALL BE CASH
COLLATERAL ACCOUNTS SUBJECT TO CONTROL AGREEMENTS.

 

2.8.                            CREDITING PAYMENTS; CLEARANCE CHARGE.

 

The receipt of any payment item by an Agent (whether from transfers to
Administrative Agent by the Cash Management Banks pursuant to the Cash
Management Agreements or otherwise) shall not be considered a payment on account
unless such payment item is in the Applicable Currency and is a wire transfer of
immediately available federal funds made to the applicable Agent’s Account or
unless and until such payment item is honored when presented for payment. 
Should any payment item not be honored when presented for payment, then the
applicable Borrowers shall be deemed not to have made such payment and interest
shall be calculated accordingly.  Anything to the contrary contained herein
notwithstanding, any payment item shall be deemed received by an Agent only if
it is received into such Agent’s Account on a Business Day on or before
11:00 a.m. (California time).  If any payment item is received into an Agent’s
Account on a non-Business Day or after 11:00 a.m. (California time) on a
Business Day, it shall be deemed to have been received by such Agent as of the
opening of business on the immediately following Business Day.  From and after
the Closing Date, the applicable Agent shall be entitled to charge (i) the US
Borrowers for 1 Business Day of ‘clearance’ at the rate then applicable under
Section 2.6 to US Advances that are Base Rate Loans denominated in Dollars on
the Dollar Equivalent of all Collections that are received by Loan Parties other
than Foreign Loan Parties (regardless of whether forwarded by the Cash
Management Banks to such Agent), (ii) the Canadian Borrowers (A) for 1 Business
Day of ‘clearance’ at the rate then applicable under Section 2.6 to Canadian
Advances that are Base Rate Loans denominated in Canadian Dollars on all
Collections denominated in Canadian Dollars that are received by Canadian
Borrowers (regardless of whether forwarded by the Cash Management Banks to such
Agent) and (B) for 1 Business Day of ‘clearance’ at the rate then applicable
under Section 2.6 to Canadian Advances that are Base Rate Loans denominated in
Dollars on the Dollar Equivalent of all Collections denominated in a currency
other than Canadian Dollars that are received by Canadian Borrowers (regardless
of whether forwarded by the Cash Management Banks to such Agent) and (iii) the
European Borrowers for 1 Business Day of ‘clearance’ at the rate then applicable
under Section 2.6 to Advances that are Base Rate Loans denominated in Dollars on
the Dollar Equivalent of all Collections that are received by European

 

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Borrowers (regardless of whether forwarded by the Cash Management Banks to such
Agent).  This across-the-board 1 Business Day clearance charge on all
Collections of Borrowers is acknowledged by the parties to constitute an
integral aspect of the pricing of the financing of Borrowers and shall apply
irrespective of whether or not there are any outstanding monetary Obligations;
the effect of such clearance charge being the equivalent of charging interest on
such Collections through the completion of a period ending 1 Business Day after
the receipt thereof.  The parties acknowledge and agree that the economic
benefit of the foregoing provisions of this Section 2.8 shall be for the
exclusive benefit of Agents.

 

2.9.                            DESIGNATED ACCOUNT.

 

Administrative Agent is authorized to make the US Advances and the Term Loan A,
and US Issuing Lenders are authorized to issue the US Letters of Credit, under
this Agreement based upon telephonic or other instructions received from anyone
purporting to be an Authorized Person or, without instructions, if pursuant to
Section 2.6(d).  Canadian Administrative Agent is authorized to make the
Canadian Advances, and Canadian Issuing Lenders are authorized to issue the
Canadian Letters of Credit, under this Agreement based upon telephonic or other
instructions received from anyone purporting to be an Authorized Person or,
without instructions, if pursuant to Section 2.6(d).  European Administrative
Agent is authorized to make the European Advances, and European Issuing Lenders
are authorized to issue the European Letters of Credit, under this Agreement
based upon telephonic or other instructions received from anyone purporting to
be an Authorized Person or, without instructions, if pursuant to
Section 2.6(d).  Administrative Borrower agrees to establish and maintain each
US Designated Account with the US Designated Account Bank for the purpose of
receiving the proceeds of the US Advances requested by US Borrowers and made by
Administrative Agent or the US Lenders hereunder.  Unless otherwise agreed by
Administrative Agent and Administrative Borrower, any US Advance, US Protective
Advance, or US Swing Loan requested by US Borrowers and made by Administrative
Agent or the US Lenders hereunder shall be made to the applicable US Designated
Account.  Administrative Borrower further agrees to cause Canadian
Administrative Borrower to establish and maintain each Canadian Designated
Account with the Canadian Designated Account Bank for the purpose of receiving
the proceeds of the Canadian Advances requested by Canadian Borrowers and made
by Canadian Administrative Agent or the Canadian Lenders hereunder.  Unless
otherwise agreed by Canadian Administrative Agent and Administrative Borrower,
any Canadian Advance, Canadian Protective Advance, or Canadian Swing Loan
requested by Canadian Borrowers and made by Canadian Administrative Agent or the
Canadian Lenders hereunder shall be made to the applicable Canadian Designated
Account.  Administrative Borrower further agrees to cause European
Administrative Borrower to establish and maintain each European Designated
Account with the European Designated Account Bank for the purpose of receiving
the proceeds of the European Advances requested by European Borrowers and made
by European Administrative Agent or the European Lenders hereunder.  Unless
otherwise agreed by European Administrative Agent and Administrative Borrower,
any European Advance, European Swing Loan or European Protective Advance
requested by European Borrowers

 

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and made by European Administrative Agent or the European Lenders hereunder
shall be made to the applicable European Designated Account.

 

2.10.                     MAINTENANCE OF LOAN ACCOUNTS; STATEMENTS OF
OBLIGATIONS.

 

Administrative Agent shall maintain an account on its books in the name of US
Borrowers (the “US Loan Account”) on which US Borrowers will be charged with the
Term Loan A, all US Advances (including Protective Advances to US Borrowers and
US Swing Loans) made by Administrative Agent, US Swing Lender, Fronting Lender,
or the US Lenders to US Borrowers or for US Borrowers’ account, the US Letters
of Credit issued by a US Issuing Lender for US Borrowers’ account, and with all
other payment US Obligations hereunder or under the other Loan Documents (except
for Bank Product Obligations), including, accrued interest, fees and expenses,
and Lender Group Expenses.  Canadian Administrative Agent shall maintain an
account on its books in the name of Canadian Borrowers (the “Canadian Loan
Account”) on which all Canadian Advances (including Protective Advances to
Canadian Borrowers and Canadian Swing Loans) made by Canadian Administrative
Agent, Canadian Swing Lender, or the Canadian Lenders to Canadian Borrowers or
for Canadian Borrowers’ account, the Canadian Letters of Credit issued by a
Canadian Issuing Lender for Canadian Borrowers’ account, and with all other
payment Foreign Obligations hereunder or under the other Loan Documents (except
for Bank Product Obligations), including, accrued interest, fees and expenses,
and Lender Group Expenses attributable to the Canadian Borrowers.  European
Administrative Agent shall maintain an account on its books in the name of
European Borrowers (the “European Loan Account”; together with the US Loan
Account and the Canadian Loan Account, each a “Loan Account” and, collectively,
the “Loan Accounts”) on which European Borrowers will be charged with all
European Advances (including Protective Advances to European Borrowers and
European Swing Loans) made by European Administrative Agent, or the European
Lenders to European Borrowers or for European Borrowers’ account, the European
Letters of Credit issued by a European Issuing Lender for European Borrowers’
account, and with all other payment Foreign Obligations hereunder or under the
other Loan Documents (except for Bank Product Obligations), including, accrued
interest, fees and expenses, and Lender Group Expenses attributable to the
European Borrowers.  In accordance with Section 2.8, the US Loan Account will be
credited with all payments received by Administrative Agent from US Borrowers or
for US Borrowers’ account, including all amounts received in the applicable
Administrative Agent’s Account from any Cash Management Bank of any US Borrower,
the Canadian Loan Account will be credited with all payments received by
Canadian Administrative Agent from Canadian Borrowers or for Canadian Borrowers’
account, including all amounts received in the applicable Canadian
Administrative Agent’s Account from any Cash Management Bank of any Canadian
Borrower and the European Loan Account will be credited with all payments
received by European Administrative Agent from European Borrowers or for
European Borrowers’ account, including all amounts received in the applicable
European Administrative Agent’s Account from any Cash Management Bank of any
European Borrower.  Administrative Agent shall render statements regarding the
Loan Accounts to Administrative Borrower, including principal, interest, fees,
and including an itemization of all charges and expenses constituting Lender
Group Expenses owing, and such

 

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statements, absent manifest error, shall be conclusively presumed to be correct
and accurate and constitute an account stated between Borrowers and the Lender
Group unless, within 30 days after receipt thereof by Administrative Borrower,
Administrative Borrower shall deliver to Administrative Agent written objection
thereto describing the error or errors contained in any such statements.

 

2.11.                     FEES.

 

Borrowers shall pay to the applicable Agent, as and when due and payable under
the terms of the Fee Letter, the fees set forth in the Fee Letter.

 

2.12.                     LETTERS OF CREDIT.

 

(A)                                  US LETTERS OF CREDIT.

 

(I)                                     SUBJECT TO THE TERMS AND CONDITIONS OF
THIS AGREEMENT, THE US ISSUING LENDER AGREES TO ISSUE LETTERS OF CREDIT FOR THE
ACCOUNT OF US BORROWERS (EACH, A “US L/C”) OR TO PURCHASE PARTICIPATIONS OR
EXECUTE INDEMNITIES OR REIMBURSEMENT OBLIGATIONS (EACH SUCH UNDERTAKING, A “US
L/C UNDERTAKING”) WITH RESPECT TO LETTERS OF CREDIT ISSUED BY A US UNDERLYING
ISSUER (AS OF THE CLOSING DATE, THE PROSPECTIVE US UNDERLYING ISSUER IS TO BE
WELLS FARGO) FOR THE ACCOUNT OF US BORROWERS.  EACH REQUEST FOR THE ISSUANCE OF
A US LETTER OF CREDIT OR THE AMENDMENT, RENEWAL, OR EXTENSION OF ANY OUTSTANDING
US LETTER OF CREDIT SHALL BE MADE IN WRITING BY AN AUTHORIZED PERSON AND
DELIVERED TO THE APPLICABLE US ISSUING LENDER AND ADMINISTRATIVE AGENT VIA HAND
DELIVERY, TELEFACSIMILE, OR OTHER ELECTRONIC METHOD OF TRANSMISSION REASONABLY
IN ADVANCE OF THE REQUESTED DATE OF ISSUANCE, AMENDMENT, RENEWAL, OR EXTENSION. 
EACH SUCH REQUEST SHALL BE IN FORM AND SUBSTANCE SATISFACTORY TO THE US ISSUING
LENDER IN ITS PERMITTED DISCRETION AND SHALL SPECIFY (I) THE AMOUNT OF SUCH US
LETTER OF CREDIT, (II) THE CURRENCY IN WHICH AMOUNTS UNDER SUCH US LETTER OF
CREDIT SHALL BE PAYABLE, (III) THE DATE OF ISSUANCE, AMENDMENT, RENEWAL, OR
EXTENSION OF SUCH US LETTER OF CREDIT, (IV) THE EXPIRATION DATE OF SUCH US
LETTER OF CREDIT, (V) THE NAME AND ADDRESS OF THE BENEFICIARY THEREOF (OR THE
BENEFICIARY OF THE US UNDERLYING LETTER OF CREDIT, AS APPLICABLE), AND (VI) SUCH
OTHER INFORMATION (INCLUDING, IN THE CASE OF AN AMENDMENT, RENEWAL, OR
EXTENSION, IDENTIFICATION OF THE OUTSTANDING US LETTER OF CREDIT TO BE SO
AMENDED, RENEWED, OR EXTENDED) AS SHALL BE NECESSARY TO PREPARE, AMEND, RENEW,
OR EXTEND SUCH US LETTER OF CREDIT.  IF REQUESTED BY THE US ISSUING LENDER, US
BORROWERS ALSO SHALL BE AN APPLICANT UNDER THE APPLICATION WITH RESPECT TO ANY
US UNDERLYING LETTER OF CREDIT THAT IS TO BE THE SUBJECT OF A US L/C
UNDERTAKING.  THE US ISSUING LENDER SHALL HAVE NO OBLIGATION TO ISSUE A US
LETTER OF CREDIT IF ANY OF THE FOLLOWING WOULD RESULT AFTER GIVING EFFECT TO THE
ISSUANCE OF SUCH REQUESTED US LETTER OF CREDIT:

 

(A)                    THE US LETTER OF CREDIT USAGE WOULD EXCEED THE US
BORROWING BASE LESS THE DOLLAR EQUIVALENT OF THE OUTSTANDING PRINCIPAL AMOUNT OF
US ADVANCES, OR

 

(B)                      THE US LETTER OF CREDIT USAGE WOULD EXCEED $30,000,000
LESS THE SUM OF THE CANADIAN LETTER OF CREDIT USAGE AND EUROPEAN LETTER OF
CREDIT USAGE, OR

 

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(C)                      THE US LETTER OF CREDIT USAGE WOULD EXCEED THE MAXIMUM
US REVOLVER AMOUNT LESS THE DOLLAR EQUIVALENT OF THE OUTSTANDING PRINCIPAL
AMOUNT OF US ADVANCES.

 

US Borrowers and the Lender Group acknowledge and agree that certain US
Underlying Letters of Credit may be issued to support letters of credit that
already are outstanding as of the Closing Date.  Each US Letter of Credit (and
corresponding US Underlying Letter of Credit) shall be in form and substance
acceptable to the US Issuing Lender (in the exercise of its Permitted
Discretion), including the requirement that the amounts payable thereunder must
be payable in Dollars or an Approved Offshore Currency.  If US Issuing Lender is
obligated to advance funds under a US Letter of Credit, US Borrowers immediately
shall reimburse such US L/C Disbursement to US Issuing Lender by paying to
Administrative Agent an amount equal to such US L/C Disbursement not later than
11:00 a.m., California time, on the date that such US L/C Disbursement is made,
if Administrative Borrower shall have received written or telephonic notice of
such US L/C Disbursement prior to 10:00 a.m., California time, on such date, or,
if such notice has not been received by Administrative Borrower prior to such
time on such date, then not later than 11:00 a.m., California time, on (x) the
Business Day that Administrative Borrower receives such notice, if such notice
is received prior to 10:00 a.m., California time, on the date of receipt of such
notice or (y) the next Business Day, if such notice is not received before such
time on the date of receipt of such notice, and, in the absence of such
reimbursement, the US L/C Disbursement immediately and automatically shall, if
the US L/C Disbursement is payable in an Approved Offshore Currency, be
converted at the Currency Exchange Rate from the applicable Approved Offshore
Currency to Dollars and shall be deemed to be a US Advance hereunder and,
thereafter, shall bear interest at the rate then applicable to US Advances that
are US Base Rate Loans denominated in Dollars under Section 2.6.  To the extent
a US L/C Disbursement is deemed to be a US Advance hereunder, US Borrowers’
obligation to reimburse such US L/C Disbursement shall be discharged and
replaced by the resulting US Advance.  Promptly following receipt by
Administrative Agent of any payment from US Borrowers pursuant to this
paragraph, Administrative Agent shall distribute such payment to the US Issuing
Lender or, to the extent that Lenders have made payments pursuant to
Section 2.12(a)(ii) to reimburse the US Issuing Lender, then to such Lenders and
the US Issuing Lender as their interests may appear.

 

(II)                                  PROMPTLY FOLLOWING RECEIPT OF A NOTICE OF
A US L/C DISBURSEMENT PURSUANT TO SECTION 2.12(A)(I), EACH LENDER WITH A US
REVOLVER COMMITMENT AGREES TO FUND ITS PRO RATA SHARE OF ANY US ADVANCE DEEMED
MADE PURSUANT TO THE FOREGOING SUBSECTION ON THE SAME TERMS AND CONDITIONS AS IF
US BORROWERS HAD REQUESTED SUCH US ADVANCE AND ADMINISTRATIVE AGENT SHALL
PROMPTLY PAY TO US ISSUING LENDER THE AMOUNTS SO RECEIVED BY IT FROM THE
LENDERS.  BY THE ISSUANCE OF A US LETTER OF CREDIT (OR AN AMENDMENT TO A US
LETTER OF CREDIT INCREASING THE AMOUNT THEREOF) AND WITHOUT ANY FURTHER ACTION
ON THE PART OF THE US ISSUING LENDER OR THE LENDERS WITH US REVOLVER
COMMITMENTS, THE US ISSUING LENDER SHALL BE DEEMED TO HAVE GRANTED TO EACH
LENDER WITH A US REVOLVER COMMITMENT, AND EACH LENDER WITH A US REVOLVER
COMMITMENT SHALL BE DEEMED TO HAVE PURCHASED, A PARTICIPATION IN EACH US LETTER
OF CREDIT, IN AN AMOUNT EQUAL TO ITS PRO RATA

 

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SHARE OF THE US RISK PARTICIPATION LIABILITY OF SUCH US LETTER OF CREDIT, AND
EACH SUCH LENDER AGREES TO PAY TO ADMINISTRATIVE AGENT, FOR THE ACCOUNT OF THE
US ISSUING LENDER, SUCH LENDER’S PRO RATA SHARE OF ANY PAYMENTS MADE BY THE US
ISSUING LENDER UNDER SUCH US LETTER OF CREDIT.  IN CONSIDERATION AND IN
FURTHERANCE OF THE FOREGOING, EACH LENDER WITH A US REVOLVER COMMITMENT HEREBY
ABSOLUTELY AND UNCONDITIONALLY AGREES TO PAY TO ADMINISTRATIVE AGENT, FOR THE
ACCOUNT OF THE US ISSUING LENDER, SUCH LENDER’S PRO RATA SHARE OF EACH US L/C
DISBURSEMENT MADE BY THE US ISSUING LENDER AND NOT REIMBURSED BY US BORROWERS ON
THE DATE DUE AS PROVIDED IN CLAUSE (A) OF THIS SECTION, OR OF ANY REIMBURSEMENT
PAYMENT REQUIRED TO BE REFUNDED TO US BORROWERS FOR ANY REASON.  EACH LENDER
WITH A US REVOLVER COMMITMENT ACKNOWLEDGES AND AGREES THAT ITS OBLIGATION TO
DELIVER TO ADMINISTRATIVE AGENT, FOR THE ACCOUNT OF THE US ISSUING LENDER, AN
AMOUNT EQUAL TO ITS RESPECTIVE PRO RATA SHARE OF EACH US L/C DISBURSEMENT MADE
BY THE US ISSUING LENDER PURSUANT TO THIS SECTION 2.12(A)(II) SHALL BE ABSOLUTE
AND UNCONDITIONAL AND SUCH REMITTANCE SHALL BE MADE NOTWITHSTANDING THE
OCCURRENCE OR CONTINUATION OF AN EVENT OF DEFAULT OR DEFAULT OR THE FAILURE TO
SATISFY ANY CONDITION SET FORTH IN SECTION 3 HEREOF.  IF ANY SUCH LENDER FAILS
TO MAKE AVAILABLE TO ADMINISTRATIVE AGENT THE AMOUNT OF SUCH LENDER’S PRO RATA
SHARE OF EACH US L/C DISBURSEMENT MADE BY THE US ISSUING LENDER IN RESPECT OF
SUCH US LETTER OF CREDIT AS PROVIDED IN THIS SECTION, SUCH LENDER SHALL BE
DEEMED TO BE A DEFAULTING LENDER AND ADMINISTRATIVE AGENT (FOR THE ACCOUNT OF
THE US ISSUING LENDER) SHALL BE ENTITLED TO RECOVER SUCH AMOUNT ON DEMAND FROM
SUCH LENDER TOGETHER WITH INTEREST THEREON AT THE DEFAULTING LENDER RATE UNTIL
PAID IN FULL.

 

(III)                               EACH US BORROWER HEREBY AGREES TO INDEMNIFY,
SAVE, DEFEND, AND HOLD THE LENDER GROUP HARMLESS FROM ANY LOSS, COST, EXPENSE,
OR LIABILITY, AND REASONABLE ATTORNEYS FEES INCURRED BY THE LENDER GROUP ARISING
OUT OF OR IN CONNECTION WITH ANY US LETTER OF CREDIT; PROVIDED, HOWEVER, THAT NO
US BORROWER SHALL BE OBLIGATED HEREUNDER TO INDEMNIFY FOR ANY LOSS, COST,
EXPENSE, OR LIABILITY TO THE EXTENT THAT IT IS CAUSED BY THE GROSS NEGLIGENCE OR
WILLFUL MISCONDUCT OF THE US ISSUING LENDER OR ANY OTHER MEMBER OF THE LENDER
GROUP.  EACH US BORROWER AGREES TO BE BOUND BY THE US UNDERLYING ISSUER’S
REGULATIONS AND INTERPRETATIONS OF ANY US UNDERLYING LETTER OF CREDIT OR BY US
ISSUING LENDER’S INTERPRETATIONS OF ANY US L/C ISSUED BY US ISSUING LENDER TO OR
FOR SUCH US BORROWER’S ACCOUNT, EVEN THOUGH THIS INTERPRETATION MAY BE DIFFERENT
FROM SUCH US BORROWER’S OWN, AND EACH US BORROWER UNDERSTANDS AND AGREES THAT
THE LENDER GROUP SHALL NOT BE LIABLE FOR ANY ERROR, NEGLIGENCE, OR MISTAKE,
WHETHER OF OMISSION OR COMMISSION, IN FOLLOWING US BORROWERS’ INSTRUCTIONS OR
THOSE CONTAINED IN THE LETTER OF CREDIT OR ANY MODIFICATIONS, AMENDMENTS, OR
SUPPLEMENTS THERETO, OTHER THAN THOSE RESULTING FROM THE GROSS NEGLIGENCE OR
WILLFUL MISCONDUCT OF THE US ISSUING LENDER OR ANY OTHER MEMBER OF THE LENDER
GROUP.  EACH US BORROWER UNDERSTANDS THAT THE US L/C UNDERTAKINGS MAY REQUIRE US
ISSUING LENDER TO INDEMNIFY THE US UNDERLYING ISSUER FOR CERTAIN COSTS OR
LIABILITIES ARISING OUT OF CLAIMS BY US BORROWERS AGAINST SUCH US UNDERLYING
ISSUER.  EACH US BORROWER HEREBY AGREES TO INDEMNIFY, SAVE, DEFEND, AND HOLD THE
LENDER GROUP HARMLESS WITH RESPECT TO ANY LOSS, COST, EXPENSE (INCLUDING
REASONABLE ATTORNEYS FEES), OR LIABILITY INCURRED BY THE LENDER GROUP UNDER ANY
US L/C UNDERTAKING AS A RESULT OF THE LENDER GROUP’S INDEMNIFICATION OF ANY US
UNDERLYING ISSUER; PROVIDED, HOWEVER, THAT NO US BORROWER SHALL BE OBLIGATED
HEREUNDER TO INDEMNIFY FOR ANY LOSS, COST, EXPENSE, OR LIABILITY TO

 

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THE EXTENT THAT IT IS CAUSED BY THE GROSS NEGLIGENCE OR WILLFUL MISCONDUCT OF
THE US ISSUING LENDER OR ANY OTHER MEMBER OF THE LENDER GROUP.  EACH US BORROWER
HEREBY ACKNOWLEDGES AND AGREES THAT NEITHER THE LENDER GROUP NOR THE US ISSUING
LENDER SHALL BE RESPONSIBLE FOR DELAYS, ERRORS, OR OMISSIONS RESULTING FROM THE
MALFUNCTION OF EQUIPMENT IN CONNECTION WITH ANY LETTER OF CREDIT.

 

(IV)                              EACH US BORROWER HEREBY AUTHORIZES AND DIRECTS
ANY US UNDERLYING ISSUER TO DELIVER TO THE US ISSUING LENDER ALL INSTRUMENTS,
DOCUMENTS, AND OTHER WRITINGS AND PROPERTY RECEIVED BY SUCH US UNDERLYING ISSUER
PURSUANT TO SUCH US UNDERLYING LETTER OF CREDIT AND TO ACCEPT AND RELY UPON THE
US ISSUING LENDER’S INSTRUCTIONS WITH RESPECT TO ALL MATTERS ARISING IN
CONNECTION WITH SUCH US UNDERLYING LETTER OF CREDIT AND THE RELATED APPLICATION.

 

(V)                                 ANY AND ALL ISSUANCE CHARGES, COMMISSIONS,
FEES, AND COSTS INCURRED BY THE US ISSUING LENDER RELATING TO US UNDERLYING
LETTERS OF CREDIT SHALL BE LENDER GROUP EXPENSES FOR PURPOSES OF THIS AGREEMENT
AND IMMEDIATELY SHALL BE REIMBURSABLE BY US BORROWERS TO ADMINISTRATIVE AGENT
FOR THE ACCOUNT OF THE US ISSUING LENDER; IT BEING ACKNOWLEDGED AND AGREED BY
EACH US BORROWER THAT, AS OF THE CLOSING DATE, THE ISSUANCE CHARGE IMPOSED BY
THE PROSPECTIVE US UNDERLYING ISSUER IS .825% PER ANNUM TIMES THE FACE AMOUNT OF
EACH US UNDERLYING LETTER OF CREDIT, THAT SUCH ISSUANCE CHARGE MAY BE CHANGED
FROM TIME TO TIME, AND THAT THE US UNDERLYING ISSUER ALSO IMPOSES A SCHEDULE OF
CHARGES FOR AMENDMENTS, EXTENSIONS, DRAWINGS, AND RENEWALS.

 

(VI)                              IF BY REASON OF (I) ANY CHANGE AFTER THE
CLOSING DATE IN ANY APPLICABLE LAW, TREATY, RULE, OR REGULATION OR ANY CHANGE IN
THE INTERPRETATION OR APPLICATION THEREOF BY ANY GOVERNMENTAL AUTHORITY, OR
(II) COMPLIANCE BY THE US UNDERLYING ISSUER OR THE LENDER GROUP WITH ANY
DIRECTION, REQUEST, OR REQUIREMENT (IRRESPECTIVE OF WHETHER HAVING THE FORCE OF
LAW) OF ANY GOVERNMENTAL AUTHORITY OR MONETARY AUTHORITY INCLUDING, REGULATION D
OF THE FEDERAL RESERVE BOARD AS FROM TIME TO TIME IN EFFECT (AND ANY SUCCESSOR
THERETO):

 

(A)                    ANY RESERVE, DEPOSIT, OR SIMILAR REQUIREMENT IS OR SHALL
BE IMPOSED OR MODIFIED IN RESPECT OF ANY US LETTER OF CREDIT ISSUED HEREUNDER,
OR

 

(B)                      THERE SHALL BE IMPOSED ON THE US UNDERLYING ISSUER OR
THE LENDER GROUP ANY OTHER CONDITION REGARDING ANY US UNDERLYING LETTER OF
CREDIT OR ANY US LETTER OF CREDIT ISSUED PURSUANT HERETO;

 

and the result of the foregoing is to increase, directly or indirectly, the cost
to the Lender Group of issuing, making, guaranteeing, or maintaining any US
Letter of Credit or to reduce the amount receivable in respect thereof by the
Lender Group, then, and in any such case, Administrative Agent may, at any time
within a reasonable period (not exceeding 180 days) after the additional cost is
incurred or the amount received is reduced, notify Administrative Borrower, and
US Borrowers shall pay on demand such amounts as Administrative Agent may
specify to be necessary to compensate the Lender Group for such additional cost
or reduced receipt, together with interest on such amount from the date of such
demand until payment in full thereof at the rate then applicable to Base Rate
Loans denominated in Dollars

 

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hereunder.  The determination by Administrative Agent of any amount due pursuant
to this Section, as set forth in a certificate delivered to the Administrative
Borrower setting forth the calculation thereof in reasonable detail, shall, in
the absence of manifest or demonstrable error, be final and conclusive and
binding on all of the parties hereto.

 

(B)                                  CANADIAN LETTERS OF CREDIT.

 

(I)                                     SUBJECT TO THE TERMS AND CONDITIONS OF
THIS AGREEMENT, THE CANADIAN ISSUING LENDER AGREES TO ISSUE LETTERS OF CREDIT
FOR THE ACCOUNT OF CANADIAN BORROWERS (EACH, A “CANADIAN L/C”) OR TO PURCHASE
PARTICIPATIONS OR EXECUTE INDEMNITIES OR REIMBURSEMENT OBLIGATIONS (EACH SUCH
UNDERTAKING, A “CANADIAN L/C UNDERTAKING”) WITH RESPECT TO LETTERS OF CREDIT
ISSUED BY A CANADIAN UNDERLYING ISSUER (AS OF THE CLOSING DATE, THE PROSPECTIVE
CANADIAN UNDERLYING ISSUER IS TO BE WELLS FARGO) FOR THE ACCOUNT OF CANADIAN
BORROWERS.  EACH REQUEST FOR THE ISSUANCE OF A CANADIAN LETTER OF CREDIT OR THE
AMENDMENT, RENEWAL, OR EXTENSION OF ANY OUTSTANDING CANADIAN LETTER OF CREDIT
SHALL BE MADE IN WRITING BY AN AUTHORIZED PERSON AND DELIVERED TO THE APPLICABLE
CANADIAN ISSUING LENDER AND CANADIAN ADMINISTRATIVE AGENT VIA HAND DELIVERY,
TELEFACSIMILE, OR OTHER ELECTRONIC METHOD OF TRANSMISSION REASONABLY IN ADVANCE
OF THE REQUESTED DATE OF ISSUANCE, AMENDMENT, RENEWAL, OR EXTENSION.  EACH SUCH
REQUEST SHALL BE IN FORM AND SUBSTANCE SATISFACTORY TO THE CANADIAN ISSUING
LENDER IN ITS PERMITTED DISCRETION AND SHALL SPECIFY (I) THE AMOUNT OF SUCH
CANADIAN LETTER OF CREDIT, (II) THE CURRENCY IN WHICH AMOUNTS UNDER SUCH
CANADIAN LETTER OF CREDIT SHALL BE PAYABLE, (III) THE DATE OF ISSUANCE,
AMENDMENT, RENEWAL, OR EXTENSION OF SUCH CANADIAN LETTER OF CREDIT, (IV) THE
EXPIRATION DATE OF SUCH CANADIAN LETTER OF CREDIT, (V) THE NAME AND ADDRESS OF
THE BENEFICIARY THEREOF (OR THE BENEFICIARY OF THE CANADIAN UNDERLYING LETTER OF
CREDIT, AS APPLICABLE), AND (VI) SUCH OTHER INFORMATION (INCLUDING, IN THE CASE
OF AN AMENDMENT, RENEWAL, OR EXTENSION, IDENTIFICATION OF THE OUTSTANDING
CANADIAN LETTER OF CREDIT TO BE SO AMENDED, RENEWED, OR EXTENDED) AS SHALL BE
NECESSARY TO PREPARE, AMEND, RENEW, OR EXTEND SUCH CANADIAN LETTER OF CREDIT. 
IF REQUESTED BY THE CANADIAN ISSUING LENDER, CANADIAN BORROWERS ALSO SHALL BE AN
APPLICANT UNDER THE APPLICATION WITH RESPECT TO ANY CANADIAN UNDERLYING LETTER
OF CREDIT THAT IS TO BE THE SUBJECT OF A CANADIAN L/C UNDERTAKING.  THE CANADIAN
ISSUING LENDER SHALL HAVE NO OBLIGATION TO ISSUE A CANADIAN LETTER OF CREDIT IF
ANY OF THE FOLLOWING WOULD RESULT AFTER GIVING EFFECT TO THE ISSUANCE OF SUCH
REQUESTED CANADIAN LETTER OF CREDIT:

 

(A)                    THE CANADIAN LETTER OF CREDIT USAGE WOULD EXCEED THE
CANADIAN BORROWING BASE LESS THE DOLLAR EQUIVALENT OF THE OUTSTANDING PRINCIPAL
AMOUNT OF CANADIAN ADVANCES, OR

 

(B)                      THE CANADIAN LETTER OF CREDIT USAGE WOULD EXCEED THE
LESSER OF (X) $10,000,000 AND (Y) $30,000,000 LESS THE SUM OF THE US LETTER OF
CREDIT USAGE AND EUROPEAN LETTER OF CREDIT USAGE, OR

 

(C)                      THE CANADIAN LETTER OF CREDIT USAGE WOULD EXCEED THE
MAXIMUM CANADIAN REVOLVER AMOUNT LESS THE DOLLAR EQUIVALENT OF THE OUTSTANDING
PRINCIPAL AMOUNT OF CANADIAN ADVANCES.

 

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Canadian Borrowers and the Lender Group acknowledge and agree that certain
Canadian Underlying Letters of Credit may be issued to support letters of credit
that already are outstanding as of the Closing Date.  Each Canadian Letter of
Credit (and corresponding Canadian Underlying Letter of Credit) shall be in form
and substance acceptable to the Canadian Issuing Lender (in the exercise of its
Permitted Discretion), including the requirement that the amounts payable
thereunder must be payable in Dollars or Canadian Dollars.  If Canadian Issuing
Lender is obligated to advance funds under a Canadian Letter of Credit, Canadian
Borrowers immediately shall reimburse such Canadian L/C Disbursement to Canadian
Issuing Lender by paying to Canadian Administrative Agent an amount in the
Applicable Currency equal to such Canadian L/C Disbursement not later than
11:00 a.m., California time, on the date that such Canadian L/C Disbursement is
made, if Administrative Borrower shall have received written or telephonic
notice of such Canadian L/C Disbursement prior to 10:00 a.m., California time,
on such date, or, if such notice has not been received by Administrative
Borrower prior to such time on such date, then not later than 11:00 a.m.,
California time, on (x) the Business Day that Administrative Borrower receives
such notice, if such notice is received prior to 10:00 a.m., California time, on
the date of receipt of such notice or (y) the next Business Day, if such notice
is not received before such time on the date of receipt of such notice, and, in
the absence of such reimbursement, the Canadian L/C Disbursement immediately and
automatically shall be deemed to be a Canadian Advance hereunder and,
thereafter, shall bear interest at the rate then applicable to Canadian Advances
that are Base Rate Loans denominated in the Applicable Currency under
Section 2.6.  To the extent a Canadian L/C Disbursement is deemed to be a
Canadian Advance hereunder, Canadian Borrowers’ obligation to reimburse such
Canadian L/C Disbursement shall be discharged and replaced by the resulting
Canadian Advance.  Promptly following receipt by Canadian Administrative Agent
of any payment from Canadian Borrowers pursuant to this paragraph, Canadian
Administrative Agent shall distribute such payment to the Canadian Issuing
Lender or, to the extent that Lenders have made payments pursuant to
Section 2.12(b)(ii) to reimburse the Canadian Issuing Lender, then to such
Lenders and the Canadian Issuing Lender as their interests may appear.

 

(II)                                  PROMPTLY FOLLOWING RECEIPT OF A NOTICE OF
A CANADIAN L/C DISBURSEMENT PURSUANT TO SECTION 2.12(B)(I), EACH LENDER WITH A
CANADIAN REVOLVER COMMITMENT AGREES TO FUND ITS PRO RATA SHARE OF ANY CANADIAN
ADVANCE DEEMED MADE PURSUANT TO THE FOREGOING SUBSECTION ON THE SAME TERMS AND
CONDITIONS AS IF CANADIAN BORROWERS HAD REQUESTED SUCH CANADIAN ADVANCE AND
CANADIAN ADMINISTRATIVE AGENT SHALL PROMPTLY PAY TO CANADIAN ISSUING LENDER THE
AMOUNTS SO RECEIVED BY IT FROM THE LENDERS.  BY THE ISSUANCE OF A CANADIAN
LETTER OF CREDIT (OR AN AMENDMENT TO A CANADIAN LETTER OF CREDIT INCREASING THE
AMOUNT THEREOF) AND WITHOUT ANY FURTHER ACTION ON THE PART OF THE CANADIAN
ISSUING LENDER OR THE LENDERS WITH CANADIAN REVOLVER COMMITMENTS, THE CANADIAN
ISSUING LENDER SHALL BE DEEMED TO HAVE GRANTED TO EACH LENDER WITH A CANADIAN
REVOLVER COMMITMENT, AND EACH LENDER WITH A CANADIAN REVOLVER COMMITMENT SHALL
BE DEEMED TO HAVE PURCHASED, A PARTICIPATION IN EACH CANADIAN LETTER OF CREDIT,
IN AN AMOUNT EQUAL TO ITS PRO RATA SHARE OF THE CANADIAN RISK PARTICIPATION
LIABILITY OF SUCH CANADIAN LETTER OF CREDIT, AND EACH SUCH LENDER AGREES TO PAY
IN THE APPLICABLE CURRENCY TO CANADIAN ADMINISTRATIVE AGENT, FOR THE ACCOUNT OF
THE CANADIAN ISSUING LENDER, SUCH LENDER’S PRO

 

45

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RATA SHARE OF ANY PAYMENTS MADE BY THE CANADIAN ISSUING LENDER UNDER SUCH
CANADIAN LETTER OF CREDIT.  IN CONSIDERATION AND IN FURTHERANCE OF THE
FOREGOING, EACH LENDER WITH A CANADIAN REVOLVER COMMITMENT HEREBY ABSOLUTELY AND
UNCONDITIONALLY AGREES TO PAY TO CANADIAN ADMINISTRATIVE AGENT, FOR THE ACCOUNT
OF THE CANADIAN ISSUING LENDER, SUCH LENDER’S PRO RATA SHARE OF EACH CANADIAN
L/C DISBURSEMENT MADE BY THE CANADIAN ISSUING LENDER AND NOT REIMBURSED BY
CANADIAN BORROWERS ON THE DATE DUE AS PROVIDED IN CLAUSE (B) OF THIS SECTION, OR
OF ANY REIMBURSEMENT PAYMENT REQUIRED TO BE REFUNDED TO CANADIAN BORROWERS FOR
ANY REASON.  EACH LENDER WITH A CANADIAN REVOLVER COMMITMENT ACKNOWLEDGES AND
AGREES THAT ITS OBLIGATION TO DELIVER TO CANADIAN ADMINISTRATIVE AGENT, FOR THE
ACCOUNT OF THE CANADIAN ISSUING LENDER, AN AMOUNT IN THE APPLICABLE CURRENCY
EQUAL TO ITS RESPECTIVE PRO RATA SHARE OF EACH CANADIAN L/C DISBURSEMENT MADE BY
THE CANADIAN ISSUING LENDER PURSUANT TO THIS SECTION 2.12(B)(II) SHALL BE
ABSOLUTE AND UNCONDITIONAL AND SUCH REMITTANCE SHALL BE MADE NOTWITHSTANDING THE
OCCURRENCE OR CONTINUATION OF AN EVENT OF DEFAULT OR DEFAULT OR THE FAILURE TO
SATISFY ANY CONDITION SET FORTH IN SECTION 3 HEREOF.  IF ANY SUCH LENDER FAILS
TO MAKE AVAILABLE TO CANADIAN ADMINISTRATIVE AGENT THE AMOUNT OF SUCH LENDER’S
PRO RATA SHARE OF EACH CANADIAN L/C DISBURSEMENT MADE BY THE CANADIAN ISSUING
LENDER IN RESPECT OF SUCH CANADIAN LETTER OF CREDIT AS PROVIDED IN THIS SECTION,
SUCH LENDER SHALL BE DEEMED TO BE A DEFAULTING LENDER AND CANADIAN
ADMINISTRATIVE AGENT (FOR THE ACCOUNT OF THE CANADIAN ISSUING LENDER) SHALL BE
ENTITLED TO RECOVER SUCH AMOUNT ON DEMAND FROM SUCH LENDER TOGETHER WITH
INTEREST THEREON AT THE DEFAULTING LENDER RATE UNTIL PAID IN FULL.

 

(III)                               EACH CANADIAN BORROWER HEREBY AGREES TO
INDEMNIFY, SAVE, DEFEND, AND HOLD THE LENDER GROUP HARMLESS FROM ANY LOSS, COST,
EXPENSE, OR LIABILITY, AND REASONABLE ATTORNEYS FEES INCURRED BY THE LENDER
GROUP ARISING OUT OF OR IN CONNECTION WITH ANY CANADIAN LETTER OF CREDIT;
PROVIDED, HOWEVER, THAT NO CANADIAN BORROWER SHALL BE OBLIGATED HEREUNDER TO
INDEMNIFY FOR ANY LOSS, COST, EXPENSE, OR LIABILITY TO THE EXTENT THAT IT IS
CAUSED BY THE GROSS NEGLIGENCE OR WILLFUL MISCONDUCT OF THE CANADIAN ISSUING
LENDER OR ANY OTHER MEMBER OF THE LENDER GROUP.  EACH CANADIAN BORROWER AGREES
TO BE BOUND BY THE CANADIAN UNDERLYING ISSUER’S REGULATIONS AND INTERPRETATIONS
OF ANY CANADIAN UNDERLYING LETTER OF CREDIT OR BY CANADIAN ISSUING LENDER’S
INTERPRETATIONS OF ANY CANADIAN L/C ISSUED BY CANADIAN ISSUING LENDER TO OR FOR
SUCH CANADIAN BORROWER’S ACCOUNT, EVEN THOUGH THIS INTERPRETATION MAY BE
DIFFERENT FROM SUCH CANADIAN BORROWER’S OWN, AND EACH CANADIAN BORROWER
UNDERSTANDS AND AGREES THAT THE LENDER GROUP SHALL NOT BE LIABLE FOR ANY ERROR,
NEGLIGENCE, OR MISTAKE, WHETHER OF OMISSION OR COMMISSION, IN FOLLOWING CANADIAN
BORROWERS’ INSTRUCTIONS OR THOSE CONTAINED IN THE CANADIAN LETTER OF CREDIT OR
ANY MODIFICATIONS, AMENDMENTS, OR SUPPLEMENTS THERETO; OTHER THAN THOSE
RESULTING FROM THE GROSS NEGLIGENCE OR WILLFUL MISCONDUCT OF THE CANADIAN
ISSUING LENDER OR ANY OTHER MEMBER OF THE LENDER GROUP.  EACH CANADIAN BORROWER
UNDERSTANDS THAT THE CANADIAN L/C UNDERTAKINGS MAY REQUIRE CANADIAN ISSUING
LENDER TO INDEMNIFY THE CANADIAN UNDERLYING ISSUER FOR CERTAIN COSTS OR
LIABILITIES ARISING OUT OF CLAIMS BY CANADIAN BORROWERS AGAINST SUCH CANADIAN
UNDERLYING ISSUER.  EACH CANADIAN BORROWER HEREBY AGREES TO INDEMNIFY, SAVE,
DEFEND, AND HOLD THE LENDER GROUP HARMLESS WITH RESPECT TO ANY LOSS, COST,
EXPENSE (INCLUDING REASONABLE ATTORNEYS FEES), OR LIABILITY INCURRED BY THE
LENDER GROUP UNDER ANY CANADIAN L/C UNDERTAKING AS A RESULT OF THE LENDER
GROUP’S INDEMNIFICATION OF ANY CANADIAN UNDERLYING

 

46

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ISSUER; PROVIDED, HOWEVER, THAT NO CANADIAN BORROWER SHALL BE OBLIGATED
HEREUNDER TO INDEMNIFY FOR ANY LOSS, COST, EXPENSE, OR LIABILITY TO THE EXTENT
THAT IT IS CAUSED BY THE GROSS NEGLIGENCE OR WILLFUL MISCONDUCT OF THE CANADIAN
ISSUING LENDER OR ANY OTHER MEMBER OF THE LENDER GROUP.  EACH CANADIAN BORROWER
HEREBY ACKNOWLEDGES AND AGREES THAT NEITHER THE LENDER GROUP NOR THE CANADIAN
ISSUING LENDER SHALL BE RESPONSIBLE FOR DELAYS, ERRORS, OR OMISSIONS RESULTING
FROM THE MALFUNCTION OF EQUIPMENT IN CONNECTION WITH ANY CANADIAN LETTER OF
CREDIT.

 

(IV)                              EACH CANADIAN BORROWER HEREBY AUTHORIZES AND
DIRECTS ANY CANADIAN UNDERLYING ISSUER TO DELIVER TO THE CANADIAN ISSUING LENDER
ALL INSTRUMENTS, DOCUMENTS, AND OTHER WRITINGS AND PROPERTY RECEIVED BY SUCH
CANADIAN UNDERLYING ISSUER PURSUANT TO SUCH CANADIAN UNDERLYING LETTER OF CREDIT
AND TO ACCEPT AND RELY UPON THE CANADIAN ISSUING LENDER’S INSTRUCTIONS WITH
RESPECT TO ALL MATTERS ARISING IN CONNECTION WITH SUCH CANADIAN UNDERLYING
LETTER OF CREDIT AND THE RELATED APPLICATION.

 

(V)                                 ANY AND ALL ISSUANCE CHARGES, COMMISSIONS,
FEES, AND COSTS INCURRED BY THE CANADIAN ISSUING LENDER RELATING TO CANADIAN
UNDERLYING LETTERS OF CREDIT SHALL BE LENDER GROUP EXPENSES FOR PURPOSES OF THIS
AGREEMENT AND IMMEDIATELY SHALL BE REIMBURSABLE BY CANADIAN BORROWERS TO
CANADIAN ADMINISTRATIVE AGENT FOR THE ACCOUNT OF THE CANADIAN ISSUING LENDER; IT
BEING ACKNOWLEDGED AND AGREED BY EACH CANADIAN BORROWER THAT, AS OF THE CLOSING
DATE, THE ISSUANCE CHARGE IMPOSED BY THE PROSPECTIVE CANADIAN UNDERLYING ISSUER
IS .825% PER ANNUM TIMES THE FACE AMOUNT OF EACH CANADIAN UNDERLYING LETTER OF
CREDIT, THAT SUCH ISSUANCE CHARGE MAY BE CHANGED FROM TIME TO TIME, AND THAT THE
CANADIAN UNDERLYING ISSUER ALSO IMPOSES A SCHEDULE OF CHARGES FOR AMENDMENTS,
EXTENSIONS, DRAWINGS, AND RENEWALS.

 

(VI)                              IF BY REASON OF (I) ANY CHANGE AFTER THE
CLOSING DATE IN ANY APPLICABLE LAW, TREATY, RULE, OR REGULATION OR ANY CHANGE IN
THE INTERPRETATION OR APPLICATION THEREOF BY ANY GOVERNMENTAL AUTHORITY, OR
(II) COMPLIANCE BY THE CANADIAN UNDERLYING ISSUER OR THE LENDER GROUP WITH ANY
DIRECTION, REQUEST, OR REQUIREMENT (IRRESPECTIVE OF WHETHER HAVING THE FORCE OF
LAW) OF ANY GOVERNMENTAL AUTHORITY OR MONETARY AUTHORITY INCLUDING, REGULATION D
OF THE FEDERAL RESERVE BOARD AS FROM TIME TO TIME IN EFFECT (AND ANY SUCCESSOR
THERETO):

 

(A)                    ANY RESERVE, DEPOSIT, OR SIMILAR REQUIREMENT IS OR SHALL
BE IMPOSED OR MODIFIED IN RESPECT OF ANY CANADIAN LETTER OF CREDIT ISSUED
HEREUNDER, OR

 

(B)                      THERE SHALL BE IMPOSED ON THE CANADIAN UNDERLYING
ISSUER OR THE LENDER GROUP ANY OTHER CONDITION REGARDING ANY CANADIAN UNDERLYING
LETTER OF CREDIT OR ANY CANADIAN LETTER OF CREDIT ISSUED PURSUANT HERETO;

 

and the result of the foregoing is to increase, directly or indirectly, the cost
to the Lender Group of issuing, making, guaranteeing, or maintaining any
Canadian Letter of Credit or to reduce the amount receivable in respect thereof
by the Lender Group, then, and in any such case, Canadian Administrative Agent
may, at any time within a reasonable period (not exceeding 180 days) after the
additional cost is incurred or the amount received is reduced,

 

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notify Administrative Borrower, and Canadian Borrowers shall pay on demand such
amounts as Canadian Administrative Agent may specify to be necessary to
compensate the Lender Group for such additional cost or reduced receipt,
together with interest on such amount from the date of such demand until payment
in full thereof at the rate then applicable to Base Rate Loans denominated in
Dollars hereunder.  The determination by Canadian Administrative Agent of any
amount due pursuant to this Section, as set forth in a certificate delivered to
the Administrative Borrower setting forth the calculation thereof in reasonable
detail, shall, in the absence of manifest or demonstrable error, be final and
conclusive and binding on all of the parties hereto.

 

(C)                                  EUROPEAN LETTERS OF CREDIT.

 

(I)                                     SUBJECT TO THE TERMS AND CONDITIONS OF
THIS AGREEMENT, THE EUROPEAN ISSUING LENDER AGREES TO ISSUE LETTERS OF CREDIT
FOR THE ACCOUNT OF EUROPEAN BORROWERS (EACH, A “EUROPEAN L/C”) OR TO PURCHASE
PARTICIPATIONS OR EXECUTE INDEMNITIES OR REIMBURSEMENT OBLIGATIONS (EACH SUCH
UNDERTAKING, A “EUROPEAN L/C UNDERTAKING”) WITH RESPECT TO LETTERS OF CREDIT
ISSUED BY A EUROPEAN UNDERLYING ISSUER (AS OF THE CLOSING DATE, THE PROSPECTIVE
EUROPEAN UNDERLYING ISSUER IS TO BE WELLS FARGO) FOR THE ACCOUNT OF EUROPEAN
BORROWERS.  EACH REQUEST FOR THE ISSUANCE OF A EUROPEAN LETTER OF CREDIT OR THE
AMENDMENT, RENEWAL, OR EXTENSION OF ANY OUTSTANDING EUROPEAN LETTER OF CREDIT
SHALL BE MADE IN WRITING BY AN AUTHORIZED PERSON AND DELIVERED TO THE APPLICABLE
EUROPEAN ISSUING LENDER AND EUROPEAN ADMINISTRATIVE AGENT VIA HAND DELIVERY,
TELEFACSIMILE, OR OTHER ELECTRONIC METHOD OF TRANSMISSION REASONABLY IN ADVANCE
OF THE REQUESTED DATE OF ISSUANCE, AMENDMENT, RENEWAL, OR EXTENSION.  EACH SUCH
REQUEST SHALL BE IN FORM AND SUBSTANCE SATISFACTORY TO THE EUROPEAN ISSUING
LENDER IN ITS PERMITTED DISCRETION AND SHALL SPECIFY (I) THE AMOUNT OF SUCH
EUROPEAN LETTER OF CREDIT, (II) THE CURRENCY IN WHICH AMOUNTS UNDER SUCH
EUROPEAN LETTER OF CREDIT SHALL BE PAYABLE, (III) THE DATE OF ISSUANCE,
AMENDMENT, RENEWAL, OR EXTENSION OF SUCH EUROPEAN LETTER OF CREDIT, (IV) THE
EXPIRATION DATE OF SUCH EUROPEAN LETTER OF CREDIT, (V) THE NAME AND ADDRESS OF
THE BENEFICIARY THEREOF (OR THE BENEFICIARY OF THE EUROPEAN UNDERLYING LETTER OF
CREDIT, AS APPLICABLE), AND (VI) SUCH OTHER INFORMATION (INCLUDING, IN THE CASE
OF AN AMENDMENT, RENEWAL, OR EXTENSION, IDENTIFICATION OF THE OUTSTANDING
EUROPEAN LETTER OF CREDIT TO BE SO AMENDED, RENEWED, OR EXTENDED) AS SHALL BE
NECESSARY TO PREPARE, AMEND, RENEW, OR EXTEND SUCH EUROPEAN LETTER OF CREDIT. 
IF REQUESTED BY THE EUROPEAN ISSUING LENDER, EUROPEAN BORROWERS ALSO SHALL BE AN
APPLICANT UNDER THE APPLICATION WITH RESPECT TO ANY EUROPEAN UNDERLYING LETTER
OF CREDIT THAT IS TO BE THE SUBJECT OF A EUROPEAN L/C UNDERTAKING.  THE EUROPEAN
ISSUING LENDER SHALL HAVE NO OBLIGATION TO ISSUE A EUROPEAN LETTER OF CREDIT IF
ANY OF THE FOLLOWING WOULD RESULT AFTER GIVING EFFECT TO THE ISSUANCE OF SUCH
REQUESTED EUROPEAN LETTER OF CREDIT:

 

(A)                    THE EUROPEAN LETTER OF CREDIT USAGE WOULD EXCEED THE
EUROPEAN BORROWING BASE LESS THE DOLLAR EQUIVALENT OF THE OUTSTANDING PRINCIPAL
AMOUNT OF EUROPEAN ADVANCES, OR

 

(B)                      THE EUROPEAN LETTER OF CREDIT USAGE WOULD EXCEED
$30,000,000 LESS THE SUM OF US LETTER OF CREDIT USAGE AND CANADIAN LETTER OF
CREDIT USAGE, OR

 

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(C)                      THE EUROPEAN LETTER OF CREDIT USAGE WOULD EXCEED THE
MAXIMUM EUROPEAN REVOLVER AMOUNT LESS THE DOLLAR EQUIVALENT OF THE OUTSTANDING
PRINCIPAL AMOUNT OF EUROPEAN ADVANCES.

 

European Borrowers and the Lender Group acknowledge and agree that certain
European Underlying Letters of Credit may be issued to support letters of credit
that already are outstanding as of the Closing Date.  Each European Letter of
Credit (and corresponding European Underlying Letter of Credit) shall be in form
and substance acceptable to the European Issuing Lender (in the exercise of its
Permitted Discretion), including the requirement that the amounts payable
thereunder must be payable in Dollars or an Approved Offshore Currency.  If
European Issuing Lender is obligated to advance funds under a European Letter of
Credit, European Borrowers immediately shall reimburse such European L/C
Disbursement to European Issuing Lender by paying to European Administrative
Agent an amount in the Applicable Currency equal to such European L/C
Disbursement not later than 11:00 a.m., California time, on the date that such
European L/C Disbursement is made, if Administrative Borrower shall have
received written or telephonic notice of such European L/C Disbursement prior to
10:00 a.m., California time, on such date, or, if such notice has not been
received by Administrative Borrower prior to such time on such date, then not
later than 11:00 a.m., California time, on (x) the Business Day that
Administrative Borrower receives such notice, if such notice is received prior
to 10:00 a.m., California time, on the date of receipt of such notice or (y) the
next Business Day, if such notice is not received before such time on the date
of receipt of such notice,, and, in the absence of such reimbursement, the
European L/C Disbursement immediately and automatically shall, if the European
L/C Disbursement is payable in an Approved Offshore Currency, be converted at
the Currency Exchange Rate from the applicable Approved Offshore Currency to
Dollars and shall be deemed to be a European Advance hereunder and, thereafter,
shall bear interest at the rate then applicable to European Advances that are
European Base Rate Loans denominated in Dollars under Section 2.6.  To the
extent a European L/C Disbursement is deemed to be a European Advance hereunder,
European Borrowers’ obligation to reimburse such European L/C Disbursement shall
be discharged and replaced by the resulting European Advance.  Promptly
following receipt by European Administrative Agent of any payment from European
Borrowers pursuant to this paragraph, European Administrative Agent shall
distribute such payment to the European Issuing Lender or, to the extent that
Lenders have made payments pursuant to Section 2.12(c)(ii) to reimburse the
European Issuing Lender, then to such Lenders and the European Issuing Lender as
their interests may appear.

 

(II)                                  PROMPTLY FOLLOWING RECEIPT OF A NOTICE OF
A EUROPEAN L/C DISBURSEMENT PURSUANT TO SECTION 2.12(C)(I), EACH LENDER WITH A
EUROPEAN REVOLVER COMMITMENT AGREES TO FUND ITS PRO RATA SHARE OF ANY EUROPEAN
ADVANCE DEEMED MADE PURSUANT TO THE FOREGOING SUBSECTION ON THE SAME TERMS AND
CONDITIONS AS IF EUROPEAN BORROWERS HAD REQUESTED SUCH EUROPEAN ADVANCE AND
EUROPEAN ADMINISTRATIVE AGENT SHALL PROMPTLY PAY TO EUROPEAN ISSUING LENDER THE
AMOUNTS SO RECEIVED BY IT FROM THE LENDERS.  BY THE ISSUANCE OF A EUROPEAN
LETTER OF CREDIT (OR AN AMENDMENT TO A EUROPEAN LETTER OF CREDIT INCREASING THE
AMOUNT THEREOF) AND WITHOUT ANY FURTHER ACTION ON THE PART OF THE

 

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EUROPEAN ISSUING LENDER OR THE LENDERS WITH EUROPEAN REVOLVER COMMITMENTS, THE
EUROPEAN ISSUING LENDER SHALL BE DEEMED TO HAVE GRANTED TO EACH LENDER WITH A
EUROPEAN REVOLVER COMMITMENT, AND EACH LENDER WITH A EUROPEAN REVOLVER
COMMITMENT SHALL BE DEEMED TO HAVE PURCHASED, A PARTICIPATION IN EACH EUROPEAN
LETTER OF CREDIT, IN AN AMOUNT EQUAL TO ITS PRO RATA SHARE OF THE EUROPEAN RISK
PARTICIPATION LIABILITY OF SUCH EUROPEAN LETTER OF CREDIT, AND EACH SUCH LENDER
AGREES TO PAY IN THE APPLICABLE CURRENCY TO EUROPEAN ADMINISTRATIVE AGENT, FOR
THE ACCOUNT OF THE EUROPEAN ISSUING LENDER, SUCH LENDER’S PRO RATA SHARE OF ANY
PAYMENTS MADE BY THE EUROPEAN ISSUING LENDER UNDER SUCH EUROPEAN LETTER OF
CREDIT.  IN CONSIDERATION AND IN FURTHERANCE OF THE FOREGOING, EACH LENDER WITH
A EUROPEAN REVOLVER COMMITMENT HEREBY ABSOLUTELY AND UNCONDITIONALLY AGREES TO
PAY TO EUROPEAN ADMINISTRATIVE AGENT, FOR THE ACCOUNT OF THE EUROPEAN ISSUING
LENDER, SUCH LENDER’S PRO RATA SHARE OF EACH EUROPEAN L/C DISBURSEMENT MADE BY
THE EUROPEAN ISSUING LENDER AND NOT REIMBURSED BY EUROPEAN BORROWERS ON THE DATE
DUE AS PROVIDED IN CLAUSE (C) OF THIS SECTION, OR OF ANY REIMBURSEMENT PAYMENT
REQUIRED TO BE REFUNDED TO EUROPEAN BORROWERS FOR ANY REASON.  EACH LENDER WITH
A EUROPEAN REVOLVER COMMITMENT ACKNOWLEDGES AND AGREES THAT ITS OBLIGATION TO
DELIVER TO EUROPEAN ADMINISTRATIVE AGENT, FOR THE ACCOUNT OF THE EUROPEAN
ISSUING LENDER, AN AMOUNT IN THE APPLICABLE CURRENCY EQUAL TO ITS RESPECTIVE PRO
RATA SHARE OF EACH EUROPEAN L/C DISBURSEMENT MADE BY THE EUROPEAN ISSUING LENDER
PURSUANT TO THIS SECTION 2.12(C)(II) SHALL BE ABSOLUTE AND UNCONDITIONAL AND
SUCH REMITTANCE SHALL BE MADE NOTWITHSTANDING THE OCCURRENCE OR CONTINUATION OF
AN EVENT OF DEFAULT OR DEFAULT OR THE FAILURE TO SATISFY ANY CONDITION SET FORTH
IN SECTION 3 HEREOF.  IF ANY SUCH LENDER FAILS TO MAKE AVAILABLE TO EUROPEAN
ADMINISTRATIVE AGENT THE AMOUNT OF SUCH LENDER’S PRO RATA SHARE OF EACH EUROPEAN
L/C DISBURSEMENT MADE BY THE EUROPEAN ISSUING LENDER IN RESPECT OF SUCH EUROPEAN
LETTER OF CREDIT AS PROVIDED IN THIS SECTION, SUCH LENDER SHALL BE DEEMED TO BE
A DEFAULTING LENDER AND EUROPEAN ADMINISTRATIVE AGENT (FOR THE ACCOUNT OF THE
EUROPEAN ISSUING LENDER) SHALL BE ENTITLED TO RECOVER SUCH AMOUNT ON DEMAND FROM
SUCH LENDER TOGETHER WITH INTEREST THEREON AT THE DEFAULTING LENDER RATE UNTIL
PAID IN FULL.

 

(III)                               EACH EUROPEAN BORROWER HEREBY AGREES TO
INDEMNIFY, SAVE, DEFEND, AND HOLD THE LENDER GROUP HARMLESS FROM ANY LOSS, COST,
EXPENSE, OR LIABILITY, AND REASONABLE ATTORNEYS FEES INCURRED BY THE LENDER
GROUP ARISING OUT OF OR IN CONNECTION WITH ANY EUROPEAN LETTER OF CREDIT;
PROVIDED, HOWEVER, THAT NO EUROPEAN BORROWER SHALL BE OBLIGATED HEREUNDER TO
INDEMNIFY FOR ANY LOSS, COST, EXPENSE, OR LIABILITY TO THE EXTENT THAT IT IS
CAUSED BY THE GROSS NEGLIGENCE OR WILLFUL MISCONDUCT OF THE EUROPEAN ISSUING
LENDER OR ANY OTHER MEMBER OF THE LENDER GROUP.  EACH EUROPEAN BORROWER AGREES
TO BE BOUND BY THE EUROPEAN UNDERLYING ISSUER’S REGULATIONS AND INTERPRETATIONS
OF ANY EUROPEAN UNDERLYING LETTER OF CREDIT OR BY EUROPEAN ISSUING LENDER’S
INTERPRETATIONS OF ANY EUROPEAN L/C ISSUED BY EUROPEAN ISSUING LENDER TO OR FOR
SUCH EUROPEAN BORROWER’S ACCOUNT, EVEN THOUGH THIS INTERPRETATION MAY BE
DIFFERENT FROM SUCH EUROPEAN BORROWER’S OWN, AND EACH EUROPEAN BORROWER
UNDERSTANDS AND AGREES THAT THE LENDER GROUP SHALL NOT BE LIABLE FOR ANY ERROR,
NEGLIGENCE, OR MISTAKE, WHETHER OF OMISSION OR COMMISSION, IN FOLLOWING EUROPEAN
BORROWERS’ INSTRUCTIONS OR THOSE CONTAINED IN THE EUROPEAN LETTER OF CREDIT OR
ANY MODIFICATIONS, AMENDMENTS, OR SUPPLEMENTS THERETO; OTHER THAN THOSE
RESULTING FROM THE GROSS NEGLIGENCE OR WILLFUL MISCONDUCT OF THE EUROPEAN
ISSUING LENDER OR ANY OTHER MEMBER OF THE

 

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LENDER GROUP.  EACH EUROPEAN BORROWER UNDERSTANDS THAT THE EUROPEAN L/C
UNDERTAKINGS MAY REQUIRE EUROPEAN ISSUING LENDER TO INDEMNIFY THE EUROPEAN
UNDERLYING ISSUER FOR CERTAIN COSTS OR LIABILITIES ARISING OUT OF CLAIMS BY
EUROPEAN BORROWERS AGAINST SUCH EUROPEAN UNDERLYING ISSUER.  EACH EUROPEAN
BORROWER HEREBY AGREES TO INDEMNIFY, SAVE, DEFEND, AND HOLD THE LENDER GROUP
HARMLESS WITH RESPECT TO ANY LOSS, COST, EXPENSE (INCLUDING REASONABLE ATTORNEYS
FEES), OR LIABILITY INCURRED BY THE LENDER GROUP UNDER ANY EUROPEAN L/C
UNDERTAKING AS A RESULT OF THE LENDER GROUP’S INDEMNIFICATION OF ANY EUROPEAN
UNDERLYING ISSUER; PROVIDED, HOWEVER, THAT NO EUROPEAN BORROWER SHALL BE
OBLIGATED HEREUNDER TO INDEMNIFY FOR ANY LOSS, COST, EXPENSE, OR LIABILITY TO
THE EXTENT THAT IT IS CAUSED BY THE GROSS NEGLIGENCE OR WILLFUL MISCONDUCT OF
THE EUROPEAN ISSUING LENDER OR ANY OTHER MEMBER OF THE LENDER GROUP.  EACH
EUROPEAN BORROWER HEREBY ACKNOWLEDGES AND AGREES THAT NEITHER THE LENDER GROUP
NOR THE EUROPEAN ISSUING LENDER SHALL BE RESPONSIBLE FOR DELAYS, ERRORS, OR
OMISSIONS RESULTING FROM THE MALFUNCTION OF EQUIPMENT IN CONNECTION WITH ANY
EUROPEAN LETTER OF CREDIT.

 

(IV)                              EACH EUROPEAN BORROWER HEREBY AUTHORIZES AND
DIRECTS ANY EUROPEAN UNDERLYING ISSUER TO DELIVER TO THE EUROPEAN ISSUING LENDER
ALL INSTRUMENTS, DOCUMENTS, AND OTHER WRITINGS AND PROPERTY RECEIVED BY SUCH
EUROPEAN UNDERLYING ISSUER PURSUANT TO SUCH EUROPEAN UNDERLYING LETTER OF CREDIT
AND TO ACCEPT AND RELY UPON THE EUROPEAN ISSUING LENDER’S INSTRUCTIONS WITH
RESPECT TO ALL MATTERS ARISING IN CONNECTION WITH SUCH EUROPEAN UNDERLYING
LETTER OF CREDIT AND THE RELATED APPLICATION.

 

(V)                                 ANY AND ALL ISSUANCE CHARGES, COMMISSIONS,
FEES, AND COSTS INCURRED BY THE EUROPEAN ISSUING LENDER RELATING TO EUROPEAN
UNDERLYING LETTERS OF CREDIT SHALL BE LENDER GROUP EXPENSES FOR PURPOSES OF THIS
AGREEMENT AND IMMEDIATELY SHALL BE REIMBURSABLE BY EUROPEAN BORROWERS TO
EUROPEAN ADMINISTRATIVE AGENT FOR THE ACCOUNT OF THE EUROPEAN ISSUING LENDER; IT
BEING ACKNOWLEDGED AND AGREED BY EACH EUROPEAN BORROWER THAT, AS OF THE CLOSING
DATE, THE ISSUANCE CHARGE IMPOSED BY THE PROSPECTIVE EUROPEAN UNDERLYING ISSUER
IS .825% PER ANNUM TIMES THE FACE AMOUNT OF EACH EUROPEAN UNDERLYING LETTER OF
CREDIT, THAT SUCH ISSUANCE CHARGE MAY BE CHANGED FROM TIME TO TIME, AND THAT THE
EUROPEAN UNDERLYING ISSUER ALSO IMPOSES A SCHEDULE OF CHARGES FOR AMENDMENTS,
EXTENSIONS, DRAWINGS, AND RENEWALS.

 

(VI)                              IF BY REASON OF (I) ANY CHANGE AFTER THE
CLOSING DATE IN ANY APPLICABLE LAW, TREATY, RULE, OR REGULATION OR ANY CHANGE IN
THE INTERPRETATION OR APPLICATION THEREOF BY ANY GOVERNMENTAL AUTHORITY, OR
(II) COMPLIANCE BY THE EUROPEAN UNDERLYING ISSUER OR THE LENDER GROUP WITH ANY
DIRECTION, REQUEST, OR REQUIREMENT (IRRESPECTIVE OF WHETHER HAVING THE FORCE OF
LAW) OF ANY GOVERNMENTAL AUTHORITY OR MONETARY AUTHORITY INCLUDING, REGULATION D
OF THE FEDERAL RESERVE BOARD AS FROM TIME TO TIME IN EFFECT (AND ANY SUCCESSOR
THERETO):

 

(A)                    ANY RESERVE, DEPOSIT, OR SIMILAR REQUIREMENT IS OR SHALL
BE IMPOSED OR MODIFIED IN RESPECT OF ANY EUROPEAN LETTER OF CREDIT ISSUED
HEREUNDER, OR

 

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(B)                      THERE SHALL BE IMPOSED ON THE EUROPEAN UNDERLYING
ISSUER OR THE LENDER GROUP ANY OTHER CONDITION REGARDING ANY EUROPEAN UNDERLYING
LETTER OF CREDIT OR ANY EUROPEAN LETTER OF CREDIT ISSUED PURSUANT HERETO;

 

and the result of the foregoing is to increase, directly or indirectly, the cost
to the Lender Group of issuing, making, guaranteeing, or maintaining any
European Letter of Credit or to reduce the amount receivable in respect thereof
by the Lender Group, then, and in any such case, European Administrative Agent
may, at any time within a reasonable period (not exceeding 180 days) after the
additional cost is incurred or the amount received is reduced, notify
Administrative Borrower, and European Borrowers shall pay on demand such amounts
as European Administrative Agent may specify to be necessary to compensate the
Lender Group for such additional cost or reduced receipt, together with interest
on such amount from the date of such demand until payment in full thereof at the
rate then applicable to Base Rate Loans denominated in Dollars hereunder.  The
determination by European Administrative Agent of any amount due pursuant to
this Section, as set forth in a certificate delivered to the Administrative
Borrower setting forth the calculation thereof in reasonable detail, shall, in
the absence of manifest or demonstrable error, be final and conclusive and
binding on all of the parties hereto.

 

2.13.                     LIBOR OPTION.

 

(A)                                  INTEREST AND INTEREST PAYMENT DATES.  IN
LIEU OF HAVING INTEREST CHARGED AT THE RATE BASED UPON THE BASE RATE, BORROWERS
SHALL HAVE THE OPTION (THE “LIBOR OPTION”) TO HAVE INTEREST ON ALL OR A PORTION
OF THE ADVANCES OR THE TERM LOAN A BE CHARGED AT A RATE OF INTEREST BASED UPON
THE APPLICABLE LIBOR RATE.  INTEREST ON LIBOR RATE LOANS SHALL BE PAYABLE ON THE
EARLIEST OF (I) THE LAST DAY OF THE INTEREST PERIOD APPLICABLE THERETO,
(PROVIDED, HOWEVER, THAT, SUBJECT TO THE FOLLOWING CLAUSES (II) AND (III), IN
THE CASE OF ANY INTEREST PERIOD GREATER THAN 1 MONTH IN DURATION, INTEREST SHALL
BE PAYABLE AT 1 MONTH INTERVALS AFTER THE COMMENCEMENT OF THE APPLICABLE
INTEREST PERIOD AND ON THE LAST DAY OF SUCH INTEREST PERIOD), (II) THE
OCCURRENCE OF AN EVENT OF DEFAULT IN CONSEQUENCE OF WHICH THE REQUIRED LENDERS
OR ADMINISTRATIVE AGENT ON BEHALF THEREOF HAVE ELECTED TO ACCELERATE THE
MATURITY OF ALL OR ANY PORTION OF THE OBLIGATIONS, OR (III) TERMINATION OF THIS
AGREEMENT PURSUANT TO THE TERMS HEREOF.  ON THE LAST DAY OF EACH APPLICABLE
INTEREST PERIOD, UNLESS ADMINISTRATIVE BORROWER PROPERLY HAS EXERCISED THE LIBOR
OPTION WITH RESPECT THERETO, THE INTEREST RATE APPLICABLE TO SUCH LIBOR RATE
LOAN AUTOMATICALLY SHALL CONVERT TO THE RATE OF INTEREST THEN APPLICABLE TO BASE
RATE LOANS OF THE SAME TYPE HEREUNDER AND, WITH RESPECT TO APPROVED OFFSHORE
RATE LOANS, THE OUTSTANDING PRINCIPAL BALANCE OF SUCH APPROVED OFFSHORE RATE
LOAN AUTOMATICALLY SHALL BE CONTINUED AS A LIBOR RATE LOAN WITH AN INTEREST
PERIOD OF ONE MONTH’S DURATION.  AT ANY TIME THAT AN EVENT OF DEFAULT HAS
OCCURRED AND IS CONTINUING, BORROWERS NO LONGER SHALL HAVE THE OPTION TO REQUEST
THAT ADVANCES OR THE TERM LOAN A BEAR INTEREST AT A RATE BASED UPON THE
APPLICABLE LIBOR RATE AND ADMINISTRATIVE AGENT SHALL HAVE THE RIGHT TO CONVERT
THE INTEREST RATE ON ALL OUTSTANDING LIBOR RATE LOANS TO THE RATE THEN
APPLICABLE TO BASE RATE LOANS HEREUNDER AND TO CONVERT THE OUTSTANDING PRINCIPAL
BALANCE OF ALL OUTSTANDING OFFSHORE CURRENCY RATE LOANS TO DOLLARS.

 

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(B)                                 LIBOR ELECTION.

 

(I)                                     ADMINISTRATIVE BORROWER MAY, AT ANY TIME
AND FROM TIME TO TIME, SO LONG AS NO EVENT OF DEFAULT HAS OCCURRED AND IS
CONTINUING, ELECT TO EXERCISE THE LIBOR OPTION BY NOTIFYING THE ADMINISTRATIVE
AGENT, CANADIAN ADMINISTRATIVE AGENT OR EUROPEAN ADMINISTRATIVE AGENT, AS
APPLICABLE, PRIOR TO 11:00 A.M. (CALIFORNIA TIME) AT LEAST 3 BUSINESS DAYS PRIOR
TO THE COMMENCEMENT OF THE PROPOSED INTEREST PERIOD (THE “LIBOR DEADLINE”). 
NOTICE OF ADMINISTRATIVE BORROWER’S ELECTION OF THE LIBOR OPTION FOR A PERMITTED
PORTION OF THE ADVANCES OR THE TERM LOAN A AND AN INTEREST PERIOD PURSUANT TO
THIS SECTION SHALL BE MADE BY DELIVERY TO THE APPLICABLE AGENT OF A LIBOR NOTICE
RECEIVED BY SUCH AGENT BEFORE THE LIBOR DEADLINE, OR BY TELEPHONIC NOTICE
RECEIVED BY SUCH AGENT BEFORE THE LIBOR DEADLINE (TO BE CONFIRMED BY DELIVERY TO
SUCH AGENT OF A LIBOR NOTICE RECEIVED BY SUCH AGENT PRIOR TO 5:00 P.M.
(CALIFORNIA TIME) ON THE SAME DAY).  PROMPTLY UPON ITS RECEIPT OF EACH SUCH
LIBOR NOTICE, ADMINISTRATIVE AGENT SHALL PROVIDE A COPY THEREOF TO EACH OF THE
US LENDERS, CANADIAN ADMINISTRATIVE AGENT SHALL PROVIDE A COPY THEREOF TO EACH
OF THE CANADIAN LENDERS AND EUROPEAN ADMINISTRATIVE AGENT SHALL PROVIDE A COPY
THEREOF TO EACH OF THE EUROPEAN LENDERS, AS APPLICABLE.

 

(II)                                  EACH LIBOR NOTICE SHALL BE IRREVOCABLE AND
BINDING ON BORROWERS.  IN CONNECTION WITH EACH LIBOR RATE LOAN, BORROWERS SHALL
JOINTLY AND SEVERALLY INDEMNIFY, DEFEND, AND HOLD THE APPLICABLE AGENT AND THE
LENDERS HARMLESS AGAINST ANY LOSS, COST, OR EXPENSE INCURRED BY SUCH AGENT OR
ANY LENDER AS A RESULT OF (A) THE PAYMENT OF ANY PRINCIPAL OF ANY LIBOR RATE
LOAN OTHER THAN ON THE LAST DAY OF AN INTEREST PERIOD APPLICABLE THERETO
(INCLUDING AS A RESULT OF AN EVENT OF DEFAULT), (B) THE CONVERSION OF ANY LIBOR
RATE LOAN OTHER THAN ON THE LAST DAY OF THE INTEREST PERIOD APPLICABLE THERETO,
OR (C) THE FAILURE TO BORROW (OTHER THAN SOLELY AS A RESULT OF THE FAILURE OF
SUCH AGENT OR A LENDER TO MAKE AN ADVANCE OR TERM LOAN A REQUIRED TO BE MADE
PURSUANT TO THE TERMS HEREOF), CONVERT, CONTINUE OR PREPAY ANY LIBOR RATE LOAN
ON THE DATE SPECIFIED IN ANY LIBOR NOTICE DELIVERED PURSUANT HERETO (SUCH
LOSSES, COSTS, AND EXPENSES, COLLECTIVELY, “FUNDING LOSSES”); PROVIDED, THAT
FOREIGN BORROWERS SHALL ONLY PROVIDE INDEMNITIES WITH RESPECT TO FUNDING LOSSES
ARISING IN CONNECTION WITH FOREIGN BORROWINGS AND LIBOR RATE LOANS MADE TO
FOREIGN BORROWERS.  FUNDING LOSSES SHALL, WITH RESPECT TO ANY AGENT OR ANY
LENDER, BE DEEMED TO EQUAL (I) WITH RESPECT TO OFFSHORE CURRENCY RATE LOANS, ANY
CURRENCY CONVERSION COSTS INCURRED BY ANY AGENT, FRONTING LENDER OR ANY OTHER
LENDER AND (II) WITH RESPECT TO ALL LIBOR RATE LOANS, THE AMOUNT DETERMINED BY
SUCH AGENT OR SUCH LENDER TO BE THE EXCESS, IF ANY, OF (A) THE AMOUNT OF
INTEREST THAT WOULD HAVE ACCRUED ON THE PRINCIPAL AMOUNT OF SUCH LIBOR RATE LOAN
HAD SUCH EVENT NOT OCCURRED, AT THE LIBOR RATE THAT WOULD HAVE BEEN APPLICABLE
THERETO, FOR THE PERIOD FROM THE DATE OF SUCH EVENT TO THE LAST DAY OF THE THEN
CURRENT INTEREST PERIOD THEREFOR (OR, IN THE CASE OF A FAILURE TO BORROW,
CONVERT OR CONTINUE, FOR THE PERIOD THAT WOULD HAVE BEEN THE INTEREST PERIOD
THEREFOR), MINUS (B) THE AMOUNT OF INTEREST THAT WOULD ACCRUE ON SUCH PRINCIPAL
AMOUNT FOR SUCH PERIOD AT THE INTEREST RATE WHICH SUCH AGENT OR SUCH LENDER
WOULD BE OFFERED WERE IT TO BE OFFERED, AT THE COMMENCEMENT OF SUCH PERIOD,
DOLLAR DEPOSITS, CANADIAN DOLLAR DEPOSITS OR APPROVED OFFSHORE CURRENCY
DEPOSITS, AS APPLICABLE, OF A COMPARABLE AMOUNT AND PERIOD IN THE LONDON
INTERBANK MARKET.  A CERTIFICATE OF AN AGENT OR A LENDER DELIVERED TO
ADMINISTRATIVE BORROWER SETTING FORTH ANY

 

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AMOUNT OR AMOUNTS THAT SUCH AGENT OR SUCH LENDER IS ENTITLED TO RECEIVE PURSUANT
TO THIS SECTION 2.13 SHALL BE CONCLUSIVE ABSENT MANIFEST ERROR.

 

(III)                               BORROWERS SHALL HAVE NOT MORE THAN 8 LIBOR
RATE LOANS IN EFFECT AT ANY GIVEN TIME.  WITH RESPECT TO LIBOR RATE LOANS OTHER
THAN APPROVED OFFSHORE RATE LOANS, BORROWERS ONLY MAY EXERCISE THE LIBOR OPTION
FOR LIBOR RATE LOANS OF A DOLLAR EQUIVALENT PRINCIPAL AMOUNT OF AT LEAST
$1,000,000 AND INTEGRAL MULTIPLES OF A DOLLAR EQUIVALENT PRINCIPAL AMOUNT OF
$500,000 IN EXCESS THEREOF AND, WITH RESPECT TO LIBOR RATE LOANS CONSISTING OF
APPROVED OFFSHORE RATE LOANS, BORROWERS ONLY MAY EXERCISE THE LIBOR OPTION FOR
LIBOR RATE LOANS OF A DOLLAR EQUIVALENT PRINCIPAL AMOUNT OF AT LEAST $2,000,000
AND INTEGRAL MULTIPLES OF A DOLLAR EQUIVALENT PRINCIPAL AMOUNT OF $1,000,000 IN
EXCESS THEREOF.

 

(C)                                  PREPAYMENTS.  BORROWERS MAY PREPAY LIBOR
RATE LOANS AT ANY TIME; PROVIDED, HOWEVER, THAT (I) BORROWERS MAY ONLY PREPAY
APPROVED OFFSHORE RATE LOANS UPON NOTICE TO ADMINISTRATIVE AGENT OR EUROPEAN
ADMINISTRATIVE AGENT, AS APPLICABLE, 3 BUSINESS DAYS PRIOR TO ANY DATE OF
PREPAYMENT OF APPROVED OFFSHORE RATE LOANS AND (II) IN THE EVENT THAT LIBOR RATE
LOANS ARE PREPAID ON ANY DATE THAT IS NOT THE LAST DAY OF THE INTEREST PERIOD
APPLICABLE THERETO, INCLUDING AS A RESULT OF ANY AUTOMATIC PREPAYMENT THROUGH
THE REQUIRED APPLICATION BY THE APPLICABLE AGENT OF PROCEEDS OF LOAN PARTIES’
COLLECTIONS IN ACCORDANCE WITH SECTION 2.4(B) OR FOR ANY OTHER REASON, INCLUDING
EARLY TERMINATION OF THE TERM OF THIS AGREEMENT OR ACCELERATION OF ALL OR ANY
PORTION OF THE OBLIGATIONS PURSUANT TO THE TERMS HEREOF, EACH BORROWER SHALL
INDEMNIFY, DEFEND, AND HOLD SUCH AGENT AND THE LENDERS AND THEIR PARTICIPANTS
HARMLESS AGAINST ANY AND ALL FUNDING LOSSES IN ACCORDANCE WITH CLAUSE
(B)(II) ABOVE; PROVIDED, THAT FOREIGN LOAN PARTIES SHALL ONLY PROVIDE
INDEMNITIES WITH RESPECT TO FUNDING LOSSES ARISING IN CONNECTION WITH FOREIGN
BORROWINGS AND LIBOR RATE LOANS MADE TO FOREIGN BORROWERS.

 

(D)                                 SPECIAL PROVISIONS APPLICABLE TO LIBOR RATE.

 

(I)                                     THE APPLICABLE LIBOR RATE MAY BE
ADJUSTED BY THE APPLICABLE AGENT WITH RESPECT TO ANY LENDER ON A PROSPECTIVE
BASIS TO TAKE INTO ACCOUNT ANY ADDITIONAL OR INCREASED COSTS TO SUCH LENDER OF
MAINTAINING OR OBTAINING ANY EURODOLLAR DEPOSITS, CANADIAN DOLLAR DEPOSITS OR
APPROVED OFFSHORE CURRENCY DEPOSITS OR INCREASED COSTS, IN EACH CASE, DUE TO
CHANGES IN APPLICABLE LAW OCCURRING SUBSEQUENT TO THE COMMENCEMENT OF THE THEN
APPLICABLE INTEREST PERIOD, INCLUDING CHANGES IN TAX LAWS (EXCEPT FOR
(A) CHANGES OF GENERAL APPLICABILITY IN CORPORATE INCOME TAX LAWS OR CHANGES IN
TAX LAWS WITH RESPECT TO FRANCHISE TAXES IMPOSED IN LIEU OF INCOME TAXES AND
(B) CHANGES IN TAX LAWS WITH RESPECT TO ANY TAXES REQUIRED TO BE WITHHELD OR
DEDUCTED BY BORROWERS, WHICH SHALL BE ADDRESSED IN SECTION 15.11) AND CHANGES IN
THE RESERVE REQUIREMENTS IMPOSED BY THE BOARD OF GOVERNORS OF THE FEDERAL
RESERVE SYSTEM (OR ANY SUCCESSOR), EXCLUDING THE RESERVE PERCENTAGE, WHICH
ADDITIONAL OR INCREASED COSTS WOULD INCREASE THE COST OF FUNDING LOANS BEARING
INTEREST AT THE APPLICABLE LIBOR RATE.  IN ANY SUCH EVENT, THE AFFECTED LENDER
SHALL GIVE ADMINISTRATIVE BORROWER AND THE APPLICABLE AGENT NOTICE OF SUCH A
DETERMINATION AND ADJUSTMENT AND SUCH AGENT PROMPTLY SHALL TRANSMIT THE NOTICE
TO EACH OTHER LENDER AND, UPON ITS RECEIPT OF THE NOTICE FROM THE AFFECTED
LENDER, ADMINISTRATIVE BORROWER MAY, BY NOTICE TO SUCH AFFECTED

 

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LENDER (Y) REQUIRE SUCH LENDER TO FURNISH TO ADMINISTRATIVE BORROWER A STATEMENT
SETTING FORTH THE BASIS FOR ADJUSTING SUCH LIBOR RATE AND THE METHOD FOR
DETERMINING THE AMOUNT OF SUCH ADJUSTMENT, OR (Z) REPAY THE LIBOR RATE LOANS
WITH RESPECT TO WHICH SUCH ADJUSTMENT IS MADE (TOGETHER WITH ANY AMOUNTS DUE
UNDER CLAUSE (B)(II) ABOVE).  NOTWITHSTANDING ANYTHING TO THE CONTRARY HEREIN,
NO SUCH ADJUSTMENT OF THE APPLICABLE LIBOR RATE SHALL BE EFFECTIVE IN RESPECT OF
ANY ADDITIONAL OR INCREASED COSTS INCURRED PRIOR TO THE ADMINISTRATIVE
BORROWER’S RECEIPT OF THE NOTICE REFERRED TO BELOW, IF THE EVENT GIVING RISE TO
SUCH ADDITIONAL OR INCREASED COSTS OCCURRED MORE THAN 180 DAYS BEFORE THE
RELEVANT LENDER’S NOTICE OF SUCH EVENT AND THE RELATED ADJUSTMENT IS RECEIVED BY
THE ADMINISTRATIVE BORROWER.

 

(II)                                  IN THE EVENT THAT ANY CHANGE IN MARKET
CONDITIONS OR ANY LAW, REGULATION, TREATY, OR DIRECTIVE, OR ANY CHANGE THEREIN
OR IN THE INTERPRETATION OR APPLICATION THEREOF, SHALL AT ANY TIME AFTER THE
DATE HEREOF, IN THE REASONABLE OPINION OF ANY LENDER, MAKE IT UNLAWFUL OR
IMPRACTICAL FOR SUCH LENDER TO FUND OR MAINTAIN LIBOR ADVANCES OR TO CONTINUE
SUCH FUNDING OR MAINTAINING, OR TO DETERMINE OR CHARGE INTEREST RATES AT THE
LIBOR RATE, SUCH LENDER SHALL GIVE NOTICE OF SUCH CHANGED CIRCUMSTANCES TO THE
APPLICABLE AGENT AND ADMINISTRATIVE BORROWER AND SUCH AGENT PROMPTLY SHALL
TRANSMIT THE NOTICE TO EACH OTHER LENDER AND (Y) IN THE CASE OF ANY LIBOR RATE
LOANS OF SUCH LENDER THAT ARE OUTSTANDING, THE DATE SPECIFIED IN SUCH LENDER’S
NOTICE SHALL BE DEEMED TO BE THE LAST DAY OF THE INTEREST PERIOD OF SUCH LIBOR
RATE LOANS, AND INTEREST UPON THE LIBOR RATE LOANS OF SUCH LENDER THEREAFTER
SHALL ACCRUE INTEREST AT THE RATE THEN APPLICABLE TO BASE RATE LOANS AND THE
OUTSTANDING PRINCIPAL BALANCE OF THE APPROVED OFFSHORE RATE LOANS SHALL CONVERT
TO DOLLARS, AND (Z) BORROWERS SHALL NOT BE ENTITLED TO ELECT THE LIBOR OPTION
UNTIL SUCH LENDER DETERMINES THAT IT WOULD NO LONGER BE UNLAWFUL OR IMPRACTICAL
TO DO SO; PROVIDED, THAT IF ANY SUCH NOTICE IS DELIVERED, BORROWERS SHALL BE
ENTITLED, AT THEIR OPTION AT ANY TIME THAT BORROWINGS DENOMINATED IN AN APPROVED
OFFSHORE CURRENCY ARE UNAVAILABLE, TO TERMINATE THIS AGREEMENT IN ACCORDANCE
WITH SECTION 3.5, EXCEPT THAT NO APPLICABLE PREPAYMENT PREMIUM SHALL BE DUE. 
EACH LENDER AGREES TO USE REASONABLE EFFORTS TO DESIGNATE A DIFFERENT LENDING
OFFICE IF SUCH DESIGNATION WILL AVOID THE NEED FOR SUCH NOTICE OF CHANGED
CIRCUMSTANCES AND WOULD NOT, IN THE GOOD FAITH JUDGMENT OF SUCH LENDER,
OTHERWISE BE DISADVANTAGEOUS TO SUCH LENDER.

 

(E)                                  NO REQUIREMENT OF MATCHED FUNDING. 
ANYTHING TO THE CONTRARY CONTAINED HEREIN NOTWITHSTANDING, NEITHER ANY AGENT,
NOR ANY LENDER, NOR ANY OF THEIR PARTICIPANTS, IS REQUIRED ACTUALLY TO ACQUIRE
EURODOLLAR, CANADIAN DOLLAR OR APPROVED OFFSHORE CURRENCY DEPOSITS TO FUND OR
OTHERWISE MATCH FUND ANY OBLIGATION AS TO WHICH INTEREST ACCRUES AT THE
APPLICABLE LIBOR RATE.  THE PROVISIONS OF THIS SECTION SHALL APPLY AS IF EACH
LENDER OR ITS PARTICIPANTS HAD MATCH FUNDED ANY OBLIGATION AS TO WHICH INTEREST
IS ACCRUING AT THE APPLICABLE LIBOR RATE BY ACQUIRING EURODOLLAR, CANADIAN
DOLLAR OR APPROVED OFFSHORE CURRENCY DEPOSITS FOR EACH INTEREST PERIOD IN THE
AMOUNT OF THE LIBOR RATE LOANS.

 

(F)                                    OFFSHORE CURRENCY RATE LOANS.  ALL
OFFSHORE CURRENCY RATE LOANS SHALL BE LIBOR RATE LOANS.

 

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2.14.                     CAPITAL REQUIREMENTS.

 

If, after the date hereof, any Lender determines that (i) the adoption of or
change in any law, rule, regulation or guideline regarding capital requirements
for banks or bank holding companies, or any change in the interpretation or
application thereof by any Governmental Authority charged with the
administration thereof, or (ii) compliance by such Lender or its parent bank
holding company with any guideline, request or directive of any such entity
regarding capital adequacy (whether or not having the force of law), has the
effect of reducing the return on such Lender’s or such holding company’s capital
as a consequence of such Lender’s Commitments hereunder to a level below that
which such Lender or such holding company could have achieved but for such
adoption, change, or compliance (taking into consideration such Lender’s or such
holding company’s then existing policies with respect to capital adequacy and
assuming the full utilization of such entity’s capital) by any amount deemed by
such Lender to be material, then such Lender may notify Administrative Borrower
and the applicable Agent thereof.  Following receipt of such notice, Borrowers
agree to pay such Lender on demand the amount of such reduction of return of
capital as and when such reduction is determined, payable within 90 days after
presentation by such Lender of a statement in the amount and setting forth in
reasonable detail such Lender’s calculation thereof and the assumptions upon
which such calculation was based (which statement shall be deemed true and
correct absent manifest error).  In determining such amount, such Lender may use
any reasonable averaging and attribution methods.  Notwithstanding anything to
the contrary in this Section 2.14, (i) no Borrower will be required to
compensate any Lender pursuant to this Section 2.14 for any reduction incurred
more than 180 days before such Lender notified Administrative Borrower of the
change in law (or other circumstance) giving rise to such reduction and of its
claim to compensation therefore and (ii) Foreign Borrowers shall not be required
to compensate any Lender for any reduction incurred with respect to US
Borrowings.

 

2.15.                     JOINT AND SEVERAL LIABILITY OF BORROWERS.

 

(A)                                  EACH US BORROWER IS ACCEPTING JOINT AND
SEVERAL LIABILITY WITH RESPECT TO THE OBLIGATIONS HEREUNDER AND UNDER THE OTHER
LOAN DOCUMENTS IN CONSIDERATION OF THE FINANCIAL ACCOMMODATIONS TO BE PROVIDED
BY THE LENDER GROUP UNDER THIS AGREEMENT, FOR THE MUTUAL BENEFIT, DIRECTLY AND
INDIRECTLY, OF EACH BORROWER AND IN CONSIDERATION OF THE UNDERTAKINGS OF THE
OTHER US BORROWERS TO ACCEPT JOINT AND SEVERAL LIABILITY FOR THE OBLIGATIONS. 
EACH US BORROWER HEREBY FURTHER IRREVOCABLY AND UNCONDITIONALLY GUARANTIES AS
AND FOR ITS OWN DEBT, UNTIL FINAL PAYMENT IN FULL THEREOF HAS BEEN MADE, (A) THE
PAYMENT OF THE OBLIGATIONS, WHEN AND AS THE SAME SHALL BECOME DUE AND PAYABLE,
WHETHER AT MATURITY, PURSUANT TO A MANDATORY PREPAYMENT REQUIREMENT, BY
ACCELERATION, OR OTHERWISE; IT BEING THE INTENT OF EACH US BORROWER THAT THE
GUARANTY SET FORTH HEREIN SHALL BE A GUARANTY OF PAYMENT AND NOT A GUARANTY OF
COLLECTION; AND (B) THE PUNCTUAL AND FAITHFUL PERFORMANCE, KEEPING, OBSERVANCE,
AND FULFILLMENT BY EACH BORROWER OF ALL OF THE AGREEMENTS, CONDITIONS,
COVENANTS, AND OBLIGATIONS OF SUCH BORROWER CONTAINED IN THIS AGREEMENT AND
UNDER EACH OF THE OTHER LOAN DOCUMENTS.  EACH FOREIGN BORROWER IS ACCEPTING
JOINT AND SEVERAL LIABILITY WITH RESPECT TO THE OBLIGATIONS OF THE FOREIGN
BORROWERS HEREUNDER AND UNDER THE OTHER LOAN DOCUMENTS IN CONSIDERATION OF THE
FINANCIAL ACCOMMODATIONS TO BE PROVIDED BY THE LENDER

 

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GROUP UNDER THIS AGREEMENT, FOR THE MUTUAL BENEFIT, DIRECTLY AND INDIRECTLY, OF
EACH FOREIGN BORROWER AND IN CONSIDERATION OF THE UNDERTAKINGS OF THE OTHER
FOREIGN BORROWERS TO ACCEPT JOINT AND SEVERAL LIABILITY FOR THE FOREIGN
OBLIGATIONS.  THE OBLIGATIONS OF THE FOREIGN BORROWERS UNDER THIS AGREEMENT,
INCLUDING ALL INDEMNITIES, REIMBURSEMENT OBLIGATIONS AND EXPENSE RECOVERY
OBLIGATIONS HEREUNDER, SHALL BE LIMITED TO THE FOREIGN OBLIGATIONS.

 

(B)                                 EACH US BORROWER, JOINTLY AND SEVERALLY,
HEREBY IRREVOCABLY AND UNCONDITIONALLY ACCEPTS, NOT MERELY AS A SURETY BUT ALSO
AS A CO-DEBTOR, JOINT AND SEVERAL LIABILITY WITH THE OTHER US BORROWERS, WITH
RESPECT TO THE PAYMENT AND PERFORMANCE OF ALL OF THE OBLIGATIONS (INCLUDING,
WITHOUT LIMITATION, ANY OBLIGATIONS ARISING UNDER THIS SECTION 2.15), IT BEING
THE INTENTION OF THE PARTIES HERETO THAT ALL THE OBLIGATIONS SHALL BE THE JOINT
AND SEVERAL OBLIGATIONS OF EACH US BORROWER WITHOUT PREFERENCES OR DISTINCTION
AMONG THEM.  EACH FOREIGN BORROWER, JOINTLY AND SEVERALLY, HEREBY IRREVOCABLY
AND UNCONDITIONALLY ACCEPTS, NOT MERELY AS A SURETY BUT ALSO AS A CO-DEBTOR,
JOINT AND SEVERAL LIABILITY WITH THE OTHER FOREIGN BORROWERS, WITH RESPECT TO
THE PAYMENT AND PERFORMANCE OF ALL OF THE FOREIGN OBLIGATIONS (INCLUDING,
WITHOUT LIMITATION, ANY FOREIGN OBLIGATIONS ARISING UNDER THIS SECTION 2.15), IT
BEING THE INTENTION OF THE PARTIES HERETO THAT ALL THE FOREIGN OBLIGATIONS SHALL
BE THE JOINT AND SEVERAL OBLIGATIONS OF EACH FOREIGN BORROWER WITHOUT
PREFERENCES OR DISTINCTION AMONG THEM.

 

(C)                                  IF AND TO THE EXTENT THAT ANY BORROWER
SHALL FAIL TO MAKE ANY PAYMENT WITH RESPECT TO ANY OF THE OBLIGATIONS AS AND
WHEN DUE OR TO PERFORM ANY OF THE OBLIGATIONS IN ACCORDANCE WITH THE TERMS
THEREOF, THEN IN EACH SUCH EVENT EACH US BORROWER AGREES THAT IT WILL MAKE SUCH
PAYMENT WITH RESPECT TO, OR PERFORM, SUCH OBLIGATION.  IF AND TO THE EXTENT THAT
ANY FOREIGN BORROWER SHALL FAIL TO MAKE ANY PAYMENT WITH RESPECT TO ANY OF THE
FOREIGN OBLIGATIONS AS AND WHEN DUE OR TO PERFORM ANY OF THE FOREIGN OBLIGATIONS
IN ACCORDANCE WITH THE TERMS THEREOF, THEN IN EACH SUCH EVENT THE OTHER FOREIGN
BORROWERS WILL MAKE SUCH PAYMENT WITH RESPECT TO, OR PERFORM, SUCH FOREIGN
OBLIGATION.

 

(D)                                 THE OBLIGATIONS OF EACH BORROWER UNDER THE
PROVISIONS OF THIS SECTION 2.15 CONSTITUTE THE ABSOLUTE AND UNCONDITIONAL, FULL
RECOURSE OBLIGATIONS OF EACH BORROWER ENFORCEABLE AGAINST EACH BORROWER TO THE
FULL EXTENT OF ITS PROPERTIES AND ASSETS, IRRESPECTIVE OF THE VALIDITY,
REGULARITY OR ENFORCEABILITY OF THIS AGREEMENT OR ANY OTHER CIRCUMSTANCES
WHATSOEVER.

 

(E)                                  EXCEPT AS OTHERWISE EXPRESSLY PROVIDED IN
THIS AGREEMENT, EACH BORROWER HEREBY WAIVES NOTICE OF ACCEPTANCE OF ITS JOINT
AND SEVERAL LIABILITY, NOTICE OF ANY ADVANCES OR LETTERS OF CREDIT ISSUED UNDER
OR PURSUANT TO THIS AGREEMENT, NOTICE OF THE OCCURRENCE OF ANY DEFAULT, EVENT OF
DEFAULT, OR OF ANY DEMAND FOR ANY PAYMENT UNDER THIS AGREEMENT, NOTICE OF ANY
ACTION AT ANY TIME TAKEN OR OMITTED BY AGENTS OR LENDERS UNDER OR IN RESPECT OF
ANY OF THE OBLIGATIONS, ANY REQUIREMENT OF DILIGENCE OR TO MITIGATE DAMAGES AND,
GENERALLY, TO THE EXTENT PERMITTED BY APPLICABLE LAW, ALL DEMANDS, NOTICES AND
OTHER FORMALITIES OF EVERY KIND IN CONNECTION WITH THIS AGREEMENT (EXCEPT AS
OTHERWISE PROVIDED IN THIS AGREEMENT).  EACH BORROWER HEREBY ASSENTS TO, AND
WAIVES NOTICE OF, ANY EXTENSION OR POSTPONEMENT OF THE TIME FOR THE PAYMENT OF
ANY OF THE OBLIGATIONS, THE ACCEPTANCE OF ANY PAYMENT OF ANY OF THE OBLIGATIONS,
THE ACCEPTANCE OF ANY PARTIAL PAYMENT THEREON, ANY

 

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WAIVER, CONSENT OR OTHER ACTION OR ACQUIESCENCE BY AGENTS OR LENDERS AT ANY TIME
OR TIMES IN RESPECT OF ANY DEFAULT BY ANY BORROWER IN THE PERFORMANCE OR
SATISFACTION OF ANY TERM, COVENANT, CONDITION OR PROVISION OF THIS AGREEMENT,
ANY AND ALL OTHER INDULGENCES WHATSOEVER BY AGENTS OR LENDERS IN RESPECT OF ANY
OF THE OBLIGATIONS, AND THE TAKING, ADDITION, SUBSTITUTION OR RELEASE, IN WHOLE
OR IN PART, AT ANY TIME OR TIMES, OF ANY SECURITY FOR ANY OF THE OBLIGATIONS OR
THE ADDITION, SUBSTITUTION OR RELEASE, IN WHOLE OR IN PART, OF ANY BORROWER. 
WITHOUT LIMITING THE GENERALITY OF THE FOREGOING, EACH BORROWER ASSENTS TO ANY
OTHER ACTION OR DELAY IN ACTING OR FAILURE TO ACT ON THE PART OF ANY AGENT OR
LENDER WITH RESPECT TO THE FAILURE BY ANY BORROWER TO COMPLY WITH ANY OF ITS
RESPECTIVE OBLIGATIONS, INCLUDING, WITHOUT LIMITATION, ANY FAILURE STRICTLY OR
DILIGENTLY TO ASSERT ANY RIGHT OR TO PURSUE ANY REMEDY OR TO COMPLY FULLY WITH
APPLICABLE LAWS OR REGULATIONS THEREUNDER, WHICH MIGHT, BUT FOR THE PROVISIONS
OF THIS SECTION 2.15 AFFORD GROUNDS FOR TERMINATING, DISCHARGING OR RELIEVING
ANY BORROWER, IN WHOLE OR IN PART, FROM ANY OF ITS OBLIGATIONS UNDER THIS
SECTION 2.15, IT BEING THE INTENTION OF EACH BORROWER THAT, SO LONG AS ANY OF
THE OBLIGATIONS HEREUNDER REMAIN UNSATISFIED, THE OBLIGATIONS OF EACH BORROWER
UNDER THIS SECTION 2.15 SHALL NOT BE DISCHARGED EXCEPT BY PERFORMANCE AND THEN
ONLY TO THE EXTENT OF SUCH PERFORMANCE.  THE OBLIGATIONS OF EACH BORROWER UNDER
THIS SECTION 2.15 SHALL NOT BE DIMINISHED OR RENDERED UNENFORCEABLE BY ANY
WINDING UP, REORGANIZATION, ARRANGEMENT, LIQUIDATION, RECONSTRUCTION OR SIMILAR
PROCEEDING WITH RESPECT TO ANY BORROWER OR ANY AGENT OR LENDER; IT BEING
UNDERSTOOD THAT OTHER PERSONS MAY ALSO BECOME LIABLE FOR THE OBLIGATIONS IN
CONNECTION WITH MERGERS, CONSOLIDATIONS OR OTHER CORPORATE REORGANIZATIONS.

 

(F)                                    EACH BORROWER REPRESENTS AND WARRANTS TO
AGENTS AND LENDERS THAT SUCH BORROWER IS CURRENTLY INFORMED OF THE FINANCIAL
CONDITION OF BORROWERS AND OF ALL OTHER CIRCUMSTANCES WHICH A DILIGENT INQUIRY
WOULD REVEAL AND WHICH BEAR UPON THE RISK OF NONPAYMENT OF THE OBLIGATIONS. 
EACH BORROWER FURTHER REPRESENTS AND WARRANTS TO AGENTS AND LENDERS THAT SUCH
BORROWER HAS READ AND UNDERSTANDS THE TERMS AND CONDITIONS OF THE LOAN
DOCUMENTS.  EACH BORROWER HEREBY COVENANTS THAT SUCH BORROWER WILL CONTINUE TO
KEEP INFORMED OF BORROWERS’ FINANCIAL CONDITION, THE FINANCIAL CONDITION OF
GUARANTORS, IF ANY, AND OF ALL OTHER CIRCUMSTANCES WHICH BEAR UPON THE RISK OF
NONPAYMENT OR NONPERFORMANCE OF THE OBLIGATIONS.

 

(G)                                 THE PROVISIONS OF THIS SECTION 2.15 ARE MADE
FOR THE BENEFIT OF AGENTS, LENDERS AND THEIR RESPECTIVE SUCCESSORS AND ASSIGNS,
AND MAY BE ENFORCED BY IT OR THEM FROM TIME TO TIME AGAINST ANY OR ALL BORROWERS
AS OFTEN AS OCCASION THEREFOR MAY ARISE AND WITHOUT REQUIREMENT ON THE PART OF
ANY SUCH AGENT, LENDER, SUCCESSOR OR ASSIGN FIRST TO MARSHAL ANY OF ITS OR THEIR
CLAIMS OR TO EXERCISE ANY OF ITS OR THEIR RIGHTS AGAINST ANY BORROWER OR TO
EXHAUST ANY REMEDIES AVAILABLE TO IT OR THEM AGAINST ANY BORROWER OR TO RESORT
TO ANY OTHER SOURCE OR MEANS OF OBTAINING PAYMENT OF ANY OF THE OBLIGATIONS
HEREUNDER OR TO ELECT ANY OTHER REMEDY.  THE PROVISIONS OF THIS SECTION 2.15
SHALL REMAIN IN EFFECT UNTIL ALL OF THE OBLIGATIONS SHALL HAVE BEEN PAID IN FULL
OR OTHERWISE FULLY SATISFIED.  IF AT ANY TIME, ANY PAYMENT, OR ANY PART THEREOF,
MADE IN RESPECT OF ANY OF THE OBLIGATIONS, IS RESCINDED OR MUST OTHERWISE BE
RESTORED OR RETURNED BY ANY AGENT OR LENDER UPON THE INSOLVENCY, BANKRUPTCY OR
REORGANIZATION OF ANY BORROWER, OR OTHERWISE, THE PROVISIONS OF THIS
SECTION 2.15 WILL FORTHWITH BE REINSTATED IN EFFECT, AS THOUGH SUCH PAYMENT HAD
NOT BEEN MADE.

 

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(H)                                 UNTIL SUCH TIME AS ALL OF THE OBLIGATIONS
HAVE BEEN FINALLY PAID IN FULL:  (I) EACH BORROWER HEREBY WAIVES AND POSTPONES
ANY RIGHT OF SUBROGATION SUCH BORROWER HAS OR MAY HAVE AS AGAINST ANY OTHER
BORROWER WITH RESPECT TO THE OBLIGATIONS; (II) EACH BORROWER HEREBY WAIVES AND
POSTPONES ANY RIGHT TO PROCEED AGAINST ANY OTHER BORROWER, NOW OR HEREAFTER, FOR
CONTRIBUTION, INDEMNITY, REIMBURSEMENT, OR ANY OTHER SURETYSHIP RIGHTS AND
CLAIMS (IRRESPECTIVE OF WHETHER DIRECT OR INDIRECT, LIQUIDATED OR CONTINGENT),
WITH RESPECT TO THE OBLIGATIONS; AND (III) EACH BORROWER ALSO HEREBY WAIVES AND
POSTPONES ANY RIGHT TO PROCEED OR TO SEEK RECOURSE AGAINST OR WITH RESPECT TO
ANY PROPERTY OR ASSET OF ANY OTHER BORROWER WITH RESPECT TO THE OBLIGATIONS.

 

(I)                                     NOTWITHSTANDING ANYTHING TO THE CONTRARY
SET FORTH IN THIS AGREEMENT, IT IS THE INTENT OF THE PARTIES HERETO THAT THE
LIABILITY INCURRED BY EACH BORROWER IN RESPECT OF THE OBLIGATIONS OF THE OTHER
BORROWERS (AND ANY LIEN GRANTED BY EACH BORROWER TO SECURE SUCH OBLIGATIONS),
NOT CONSTITUTE A FRAUDULENT CONVEYANCE UNDER SECTION 548 OF THE BANKRUPTCY CODE
OR A FRAUDULENT CONVEYANCE OR FRAUDULENT TRANSFER UNDER THE PROVISIONS OF ANY
APPLICABLE LAW OF ANY STATE, PROVINCE OR OTHER GOVERNMENTAL UNIT (“FRAUDULENT
CONVEYANCE”). CONSEQUENTLY, EACH BORROWER, EACH AGENT AND EACH LENDER HEREBY
AGREES THAT IF A COURT OF COMPETENT JURISDICTION DETERMINES THAT THE INCURRENCE
OF LIABILITY BY ANY BORROWER IN RESPECT OF THE OBLIGATIONS OF ANY OTHER BORROWER
(OR ANY LIENS GRANTED BY SUCH BORROWER TO SECURE SUCH OBLIGATIONS) WOULD, BUT
FOR THE APPLICATION OF THIS SENTENCE, CONSTITUTE A FRAUDULENT CONVEYANCE, SUCH
LIABILITY (AND SUCH LIENS) SHALL BE VALID AND ENFORCEABLE ONLY TO THE MAXIMUM
EXTENT THAT WOULD NOT CAUSE THE SAME TO CONSTITUTE A FRAUDULENT CONVEYANCE, AND
THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS SHALL AUTOMATICALLY BE DEEMED TO
HAVE BEEN AMENDED ACCORDINGLY.

 

(J)                                     THE LENDERS SHALL NOT BE ENTITLED TO
REQUEST PAYMENT OR PERFORMANCE FROM A GERMAN BORROWER UNDER THE JOINT AND
SEVERAL LIABILITY PURSUANT TO THIS SECTION 2.15 IF AND TO THE EXTENT THAT THE
JOINT AND SEVERAL LIABILITY OF A GERMAN BORROWER EXTENDS TO OBLIGATIONS OF AN
AFFILIATED COMPANY (VERBUNDENES UNTERNEHMEN) WITHIN THE MEANING OF SECTION 15 ET
SEQ. OF THE GERMAN STOCK CORPORATION ACT (AKTIENGESETZ) OF SUCH GERMAN BORROWER
(OTHER THAN SUCH GERMAN BORROWER’S SUBSIDIARIES AND THEIR SUBSIDIARIES) AND IF
AND TO THE EXTENT THAT SUCH ENFORCEMENT WOULD LEAD TO A SITUATION IN WHICH SUCH
GERMAN BORROWER’S ASSETS (THE CALCULATION OF WHICH SHALL TAKE INTO ACCOUNT THE
CAPTIONS REFLECTED IN SECTION 266 SUBSECTION (2) A, B AND C OF THE GERMAN
COMMERCIAL CODE (HGB, HANDELSGESETZBUCH)) LESS THE SUM OF (A) THE LIABILITIES OF
SUCH GERMAN BORROWER (THE CALCULATION OF WHICH SHALL TAKE INTO ACCOUNT THE
CAPTIONS REFLECTED IN SECTION 266 SUB-SECTION (3) B, C AND D OF THE GERMAN
COMMERCIAL CODE), AND (B) THE STATED SHARE CAPITAL (STAMMKAPITAL) OF SUCH GERMAN
BORROWER (THE “NET ASSETS”) ARE LESS THAN ZERO;

 

(I)                                     FOR THE PURPOSES OF THE CALCULATION OF
THE NET ASSETS FOLLOWING BALANCE SHEET ITEMS SHALL BE ADJUSTED AS FOLLOWS:

 

(A)                    THE AMOUNT OF ANY INCREASE OF THE STATED SHARE CAPITAL
AFTER THE DATE HEREOF (EXCLUDING ANY SUCH INCREASE OF STATED SHARE CAPITAL
PERMITTED PURSUANT TO ANY OTHER AGREEMENT TO WHICH THE LOAN PARTIES AND SUCH
GERMAN BORROWER ARE A PARTY) (A) THAT HAS BEEN EFFECTED WITHOUT THE PRIOR
WRITTEN CONSENT OF THE LENDERS, (B) THAT HAS BEEN

 

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EFFECTED OUT OF RETAINED EARNINGS (KAPITALERHÖHUNG AUS GESELLSCHAFTSMITTELN) OR
TO THE EXTENT THAT IT IS NOT FULLY PAID UP, SHALL BE DEDUCTED FROM THE STATED
SHARE CAPITAL; AND

 

(B)                      LOANS AND OTHER CONTRACTUAL LIABILITIES INCURRED IN
GROSSLY NEGLIGENT (GROB FAHRLÄSSIG) OR WILFUL (VORSÄTZLICH) VIOLATION OF THE
PROVISIONS OF THE LOAN DOCUMENTS SHALL BE DISREGARDED;

 

(II)                                  IN ADDITION, SUCH GERMAN BORROWER SHALL
REALISE, TO THE EXTENT LEGALLY PERMITTED AND COMMERCIALLY JUSTIFIABLE, IN A
SITUATION WHERE SUCH GERMAN BORROWER’S NET ASSETS ARE OR BECOME AS A CONSEQUENCE
OF PAYMENT OR PERFORMANCE UNDER THE JOINT AND SEVERAL LIABILITY LESS THAN ZERO
ANY AND ALL OF ITS ASSETS THAT ARE SHOWN IN THE BALANCE SHEET WITH A BOOK VALUE
(BUCHWERT) THAT IS SIGNIFICANTLY LOWER THAN THE MARKET VALUE OF THE ASSETS IF
THE ASSET IS NOT NECESSARY FOR SUCH GERMAN BORROWER’S BUSINESS
(BETRIEBSNOTWENDIG);

 

(III)                               FOR THE PURPOSE OF THE CALCULATION OF THE
NET ASSETS AND THUS THE ENFORCEABLE AMOUNT, SUCH GERMAN BORROWER WILL DELIVER
WITHIN THIRTY DAYS FOLLOWING THE DEMAND AGAINST SUCH GERMAN BORROWER UNDER THIS
SECTION 2.15 BY THE LENDERS, TO THE LENDERS AN UP TO DATE BALANCE SHEET DRAWN-UP
BY A FIRM OF AUDITORS OF INTERNATIONAL STANDARD AND REPUTE TOGETHER WITH A
DETERMINATION OF THE NET ASSETS.  SUCH BALANCE SHEET AND DETERMINATION OF NET
ASSETS SHALL BE PREPARED IN ACCORDANCE WITH ACCOUNTING PRINCIPLES PURSUANT TO
THE GERMAN COMMERCIAL CODE AND BE BASED ON THE SAME PRINCIPLES THAT WERE APPLIED
WHEN ESTABLISHING THE PREVIOUS YEAR’S BALANCE SHEET;

 

(IV)                              THE DETERMINATION BY THE AUDITORS (AS SET
FORTH ABOVE, THE “AUDITORS’ DETERMINATION”) PERTAINING TO SUCH GERMAN BORROWER
SHALL BE UP TO DATE AND IN ANY EVENT SUCH AUDITORS’ DETERMINATION SHALL HAVE
BEEN PREPARED AS OF A DATE NO EARLIER THAN FIFTEEN BUSINESS DAYS PRIOR TO THE
DATE OF THE ENFORCEMENT OF THE SECURITY INTEREST CREATED UNDER THIS AGREEMENT;
AND

 

(V)                                 SHOULD SUCH GERMAN BORROWER FAIL TO DELIVER
SUCH BALANCE SHEET AND/OR DETERMINATION OF THE NET ASSETS, THE LENDERS SHALL BE
ENTITLED TO ENFORCE THE JOINT AND SEVERAL LIABILITY CREATED UNDER THIS
SECTION 2.15 WITHOUT LIMITATION, BUT AGREE TO RELEASE PROCEEDS FROM SUCH
ENFORCEMENT TO THE EXTENT REQUIRED TO ENSURE THAT THE NET ASSETS SHALL NOT BE
LESS THAN ZERO.

 

2.16.                     INTEREST ACT (CANADA); CRIMINAL RATE OF INTEREST;
NOMINAL RATE OF INTEREST.

 

Notwithstanding anything to the contrary contained in this Agreement or in any
other Loan Document, solely to the extent that a court of competent jurisdiction
finally determines that the calculation or determination of interest payable by
a Foreign Borrower created or organized under the laws of Canada or any province
thereof in respect of the Obligations pursuant to this Agreement and the other
Loan Documents shall be governed by the laws of the province of Ontario or the
federal laws of Canada:

 

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(A)                                  WHENEVER INTEREST PAYABLE BY SUCH FOREIGN
BORROWER IS CALCULATED ON THE BASIS OF A PERIOD WHICH IS LESS THAN THE ACTUAL
NUMBER OF DAYS IN A CALENDAR YEAR, EACH RATE OF INTEREST DETERMINED PURSUANT TO
SUCH CALCULATION, EXPRESSED AS AN ANNUAL RATE OF INTEREST FOR THE PURPOSES OF
THE INTEREST ACT (CANADA), SHALL BE EQUIVALENT TO SUCH RATE MULTIPLIED BY THE
ACTUAL NUMBER OF DAYS IN THE CALENDAR YEAR IN WHICH SUCH RATE IS TO BE
ASCERTAINED AND DIVIDED BY THE NUMBER OF DAYS USED AS THE BASIS OF SUCH
CALCULATION;

 

(B)                                 IN NO EVENT SHALL THE AGGREGATE “INTEREST”
(AS DEFINED IN SECTION 347 OF THE CRIMINAL CODE, R.S.C. 1985, C. C-46, AS THE
SAME SHALL BE AMENDED, REPLACED OR RE-ENACTED FROM TIME TO TIME) PAYABLE BY SUCH
FOREIGN BORROWER TO ANY AGENT OR ANY LENDER UNDER THIS AGREEMENT OR ANY OTHER
LOAN DOCUMENT EXCEED THE EFFECTIVE ANNUAL RATE OF INTEREST ON THE “CREDIT
ADVANCED” (AS DEFINED IN THAT SECTION) UNDER THIS AGREEMENT OR SUCH OTHER LOAN
DOCUMENT LAWFULLY PERMITTED UNDER THAT SECTION AND, IF ANY PAYMENT, COLLECTION
OR DEMAND PURSUANT TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT IN RESPECT OF
“INTEREST” (AS DEFINED IN THAT SECTION) IS DETERMINED TO BE CONTRARY TO THE
PROVISIONS OF THAT SECTION, SUCH PAYMENT, COLLECTION OR DEMAND SHALL BE DEEMED
TO HAVE BEEN MADE BY MUTUAL MISTAKE OF AGENTS, LENDERS AND SUCH FOREIGN BORROWER
AND THE AMOUNT OF SUCH PAYMENT OR COLLECTION SHALL BE REFUNDED BY THE APPLICABLE
AGENT AND LENDERS TO SUCH FOREIGN BORROWER.  FOR THE PURPOSES OF THIS AGREEMENT
AND EACH OTHER LOAN DOCUMENT TO WHICH SUCH FOREIGN BORROWER IS A PARTY, THE
EFFECTIVE ANNUAL RATE OF INTEREST PAYABLE BY SUCH FOREIGN BORROWER SHALL BE
DETERMINED IN ACCORDANCE WITH GENERALLY ACCEPTED ACTUARIAL PRACTICES AND
PRINCIPLES OVER THE TERM OF THE LOANS ON THE BASIS OF ANNUAL COMPOUNDING FOR THE
LAWFULLY PERMITTED RATE OF INTEREST AND, IN THE EVENT OF DISPUTE, A CERTIFICATE
OF A FELLOW OF THE INSTITUTE OF ACTUARIES APPOINTED BY CANADIAN ADMINISTRATIVE
AGENT FOR THE ACCOUNT OF FOREIGN BORROWER WILL BE CONCLUSIVE FOR THE PURPOSE OF
SUCH DETERMINATION IN THE ABSENCE OF EVIDENCE TO THE CONTRARY; AND

 

(C)                                  ALL CALCULATIONS OF INTEREST PAYABLE BY
SUCH FOREIGN BORROWER UNDER THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT ARE TO BE
MADE ON THE BASIS OF THE NOMINAL INTEREST RATE DESCRIBED HEREIN AND THEREIN AND
NOT ON THE BASIS OF EFFECTIVE YEARLY RATES OR ON ANY OTHER BASIS WHICH GIVES
EFFECT TO THE PRINCIPLE OF DEEMED REINVESTMENT OF INTEREST.  THE PARTIES
ACKNOWLEDGE THAT THERE IS A MATERIAL DIFFERENCE BETWEEN THE STATED NOMINAL
INTEREST RATES AND THE EFFECTIVE YEARLY RATES OF INTEREST AND THAT THEY ARE
CAPABLE OF MAKING THE CALCULATIONS REQUIRED TO DETERMINE SUCH EFFECTIVE YEARLY
RATES OF INTEREST.

 

2.17.                     ADDITIONAL PROVISIONS REGARDING OFFSHORE CURRENCY RATE
LOANS AND FRONTING LENDER.

 

(A)                                  NON-OFFSHORE CURRENCY LENDER. IF ANY LENDER
(OTHER THAN THE FRONTING LENDER) DETERMINES (WHICH DETERMINATION SHALL BE
CONCLUSIVE) THAT AN APPROVED OFFSHORE CURRENCY IS NOT FREELY TRANSFERABLE AND
CONVERTIBLE BY SUCH LENDER INTO DOLLARS OR THAT IT WILL BE IMPRACTICABLE FOR
SUCH LENDER TO FUND ADVANCES IN SUCH APPROVED OFFSHORE CURRENCY, THEN SUCH
LENDER SHALL IMMEDIATELY SO NOTIFY THE ADMINISTRATIVE AGENT WHICH NOTIFICATION
SHALL BE GIVEN IMMEDIATELY BY THE ADMINISTRATIVE AGENT TO THE FRONTING LENDER,
AND SUCH LENDER SHALL THEREAFTER BE DEEMED TO BE A NON-OFFSHORE CURRENCY LENDER
HEREUNDER.

 

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(B)                                 APPLICATION OF INTEREST PAYMENTS.  AS
PROMPTLY AS IS PRACTICABLE FOLLOWING EACH DATE UPON WHICH ADMINISTRATIVE AGENT
OR EUROPEAN ADMINISTRATIVE AGENT RECEIVES A PAYMENT OF INTEREST UNDER THIS
AGREEMENT ON ACCOUNT OF ANY OFFSHORE CURRENCY RATE LOANS, SUCH AGENT SHALL
DISTRIBUTE TO THE FRONTING LENDER THE AMOUNT THEREOF THAT IS ALLOCABLE TO THE
OFFSHORE CURRENCY RATE LOANS HELD BY THE FRONTING LENDER.  IN CONSIDERATION OF
THE AGREEMENT OF THE NON-OFFSHORE CURRENCY LENDERS TO PURCHASE PARTICIPATING
INTERESTS IN ANY OFFSHORE CURRENCY RATE LOANS HELD BY THE FRONTING LENDER, THE
FRONTING LENDER SHALL, WITH RESPECT TO US ADVANCES CONSISTING OF OFFSHORE
CURRENCY RATE LOANS, PAY TO THE ADMINISTRATIVE AGENT, FOR THE RATABLE ACCOUNTS
OF EACH NON-OFFSHORE CURRENCY LENDER THAT IS A US LENDER, A RISK PARTICIPATION
FEE, IN THE CURRENCY OF SUCH INTEREST PAYMENT OR, IF REQUESTED BY EACH
NON-OFFSHORE CURRENCY LENDER THAT IS A US LENDER AND AGREED TO BY THE
ADMINISTRATIVE AGENT, IN DOLLARS, IN AN AMOUNT EQUAL TO THE PORTION OF SUCH
INTEREST PAYMENT WHICH CONSTITUTES THE LIBOR RATE MARGIN LESS 0.50% (OTHER THAN
ANY SUCH PROCEEDS PAYABLE FOR THE ACCOUNT OF ANY DEFAULTING LENDER, WHICH
PROCEEDS SHALL BE RETAINED BY THE FRONTING LENDER FOR ITS OWN ACCOUNT) AND, WITH
RESPECT TO EUROPEAN ADVANCES CONSISTING OF OFFSHORE CURRENCY RATE LOANS, PAY TO
THE EUROPEAN ADMINISTRATIVE AGENT, FOR THE RATABLE ACCOUNTS OF EACH NON-OFFSHORE
CURRENCY LENDER THAT IS A EUROPEAN LENDER, A RISK PARTICIPATION FEE, IN THE
CURRENCY OF SUCH INTEREST PAYMENT OR, IF REQUESTED BY EACH NON-OFFSHORE CURRENCY
LENDER AND AGREED TO BY THE EUROPEAN ADMINISTRATIVE AGENT, IN DOLLARS, IN AN
AMOUNT EQUAL TO THE PORTION OF SUCH INTEREST PAYMENT WHICH CONSTITUTES THE LIBOR
RATE MARGIN LESS 0.50% (OTHER THAN ANY SUCH PROCEEDS PAYABLE FOR THE ACCOUNT OF
ANY DEFAULTING LENDER, WHICH PROCEEDS SHALL BE RETAINED BY THE FRONTING LENDER
FOR ITS OWN ACCOUNT); PROVIDED, HOWEVER, THAT WITH RESPECT TO EACH NON-OFFSHORE
CURRENCY LENDER WHICH HAS FUNDED THE PURCHASE OF PARTICIPATING INTERESTS IN THE
EXTENSIONS OF CREDIT ON ACCOUNT OF WHICH SUCH INTEREST WAS PAID HEREUNDER, THE
FRONTING LENDER SHALL INSTEAD PAY TO APPLICABLE AGENT, FOR THE ACCOUNT OF SUCH
NON-OFFSHORE CURRENCY LENDER WHICH HAS SO FUNDED SUCH PURCHASE, THE AMOUNT EQUAL
TO SUCH LENDER’S PRO RATA SHARE OF SUCH INTEREST PAYMENT.  SUCH AMOUNT SHALL BE
PAYABLE TO THE APPLICABLE AGENT, IN THE CURRENCY OF SUCH INTEREST PAYMENT OR
FROM A CONVERSION OF SUCH CURRENCY TO DOLLARS, IF REQUESTED BY EACH NON-OFFSHORE
CURRENCY LENDER AND AGREED TO BY APPLICABLE AGENT, ON THE DATE UPON WHICH THE
FRONTING LENDER RECEIVES THE INTEREST PAYMENT (OR, AS APPLICABLE, THE PROCEEDS
OF SUCH CONVERSION).

 

(C)                                  CURRENCY CONVERSION AND CONTINGENT FUNDING
AGREEMENT.  EACH NON-OFFSHORE CURRENCY LENDER THAT IS A US LENDER HEREBY
UNCONDITIONALLY AND IRREVOCABLY AGREES TO PURCHASE (IN THE CURRENCY IN WHICH THE
APPLICABLE OFFSHORE CURRENCY RATE LOAN IS MADE) AS AND WHEN REQUESTED BY THE
ADMINISTRATIVE AGENT OR THE FRONTING LENDER AT ANY TIME, AN UNDIVIDED
PARTICIPATING INTEREST EQUAL TO ITS PRO RATA SHARE OF ALL OFFSHORE CURRENCY RATE
LOANS THAT ARE US ADVANCES THAT ARE MADE BY THE FRONTING LENDER AND EACH
NON-OFFSHORE CURRENCY LENDER THAT IS A EUROPEAN LENDER HEREBY UNCONDITIONALLY
AND IRREVOCABLY AGREES TO PURCHASE (IN THE CURRENCY IN WHICH THE APPLICABLE
OFFSHORE CURRENCY RATE LOAN IS MADE) AS AND WHEN REQUESTED BY THE EUROPEAN
ADMINISTRATIVE AGENT OR THE FRONTING LENDER AT ANY TIME, AN UNDIVIDED
PARTICIPATING INTEREST EQUAL TO ITS PRO RATA SHARE OF ALL OFFSHORE CURRENCY RATE
LOANS THAT ARE EUROPEAN ADVANCES THAT ARE MADE BY THE FRONTING LENDER, PROVIDED
THAT:

 

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(i)                                     the Administrative Agent, the European
Administrative Agent and the Fronting Lender hereby agree that, unless an Event
of Default has occurred and is continuing or a Fronting Loan Event has occurred,
such Persons will not request any such purchase of participating interests; and

 

(ii)                                  in the event that any Event of Default
specified in Section 7.4 or 7.5 shall have occurred with respect to any
Borrower, each Non-Offshore Currency Lender shall be deemed to have purchased,
automatically and without request, such participating interest in the Advances
denominated in the applicable Approved Offshore Currency.

 

Any such request with respect to US Advances shall be made in writing to each
Non-Offshore Currency Lender that is a US Lender and shall specify the amount of
the applicable Approved Offshore Currency required from such Non-Offshore
Currency Lender in order to effect the purchase by such Non-Offshore Currency
Lender of a participating interest in the amount equal to its Pro Rata Share
times the aggregate then outstanding principal amount (in the applicable
Approved Offshore Currency) of the US Advances denominated in such Applicable
Offshore Currency and any such request with respect to European Advances shall
be made in writing to each Non-Offshore Currency Lender that is a European
Lender and shall specify the amount of the applicable Approved Offshore Currency
required from such Non-Offshore Currency Lender in order to effect the purchase
by such Non-Offshore Currency Lender of a participating interest in the amount
equal to its Pro Rata Share times the aggregate then outstanding principal
amount (in the applicable Approved Offshore Currency) of the European Advances
denominated in such Applicable Offshore Currency.  Promptly upon receipt of such
request by any Non-Offshore Currency Lender, such Non-Offshore Currency Lender
shall deliver to the applicable Agent (in immediately available funds) the
amount so specified by such Agent.  The applicable Agent shall promptly deliver
the proceeds of such payments to the Fronting Lender in immediately available
funds.  Promptly following receipt thereof, the Fronting Lender will deliver to
such Non-Offshore Currency Lender (through the applicable Agent) a certificate
setting forth the amount of the Advances purchased by such Non-Offshore Currency
Lender, dated the date of receipt of such funds and in such amount. 
Notwithstanding anything to the contrary contained in this Section 2.17, the
failure of any Non-Offshore Currency Lender to purchase its participating
interest in any Advances shall not relieve any other Non-Offshore Currency
Lender of its obligations hereunder to purchase its participating interest in a
timely manner, but no Non-Offshore Currency Lender shall be responsible for the
failure of any other Non-Offshore Currency Lender to purchase the participating
interest to be purchased by such other Non-Offshore Currency Lenders on any
date.

 

(D)                                 INTEREST PAYABLE FOR THE BENEFIT OF THE
FRONTING LENDER.  IF ANY AMOUNT REQUIRED TO BE PAID BY ANY NON-OFFSHORE CURRENCY
LENDER WITH RESPECT TO ANY ADVANCE PURSUANT TO SECTION 2.17(C) IS NOT PAID TO
THE APPLICABLE AGENT WITHIN ONE (1) BUSINESS DAY FOLLOWING THE DATE UPON WHICH
SUCH NON-OFFSHORE CURRENCY LENDER RECEIVES A REQUEST FROM THE APPLICABLE AGENT
OR THE FRONTING LENDER THAT SUCH NON-OFFSHORE CURRENCY LENDER FUND ITS
PARTICIPATING INTEREST RELATING TO SUCH ADVANCE, SUCH NON-OFFSHORE CURRENCY
LENDER SHALL PAY TO THE APPLICABLE AGENT ON DEMAND INTEREST ON SUCH AMOUNT AT A
RATE PER ANNUM EQUAL TO THE DEFAULTING LENDER RATE, DURING THE PERIOD FROM AND
INCLUDING THE DATE SUCH PAYMENT IS

 

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REQUIRED TO BE MADE TO THE DATE ON WHICH SUCH PAYMENT IS IMMEDIATELY AVAILABLE
TO SUCH AGENT.  A CERTIFICATE FROM AN AGENT SUBMITTED TO ANY NON-OFFSHORE
CURRENCY LENDER WITH RESPECT TO ANY AMOUNTS OWING UNDER SECTION 2.17(C) OR THIS
SECTION 2.17(D) SHALL BE CONCLUSIVE IN THE ABSENCE OF MANIFEST ERROR. AMOUNTS
PAYABLE BY ANY NON-OFFSHORE CURRENCY LENDER PURSUANT TO SECTION 2.17(C) OR THIS
SECTION 2.17(D) SHALL BE PAID TO THE APPLICABLE AGENT, FOR THE ACCOUNT OF THE
FRONTING LENDER; PROVIDED THAT, IF THE APPLICABLE AGENT (IN ITS SOLE DISCRETION)
HAS ELECTED TO FUND ON BEHALF OF SUCH NON-OFFSHORE CURRENCY LENDER THE AMOUNTS
OWING TO THE FRONTING LENDER THEN THE AMOUNTS SHALL BE PAID TO SUCH AGENT, FOR
ITS OWN ACCOUNT.

 

(E)                                  DISTRIBUTIONS OF PAYMENTS MADE ON FRONTED
LOANS.  WHENEVER, AT ANY TIME AFTER THE FRONTING LENDER HAS RECEIVED FROM ANY
NON-OFFSHORE CURRENCY LENDER PAYMENT IN RESPECT OF SUCH NON-OFFSHORE CURRENCY
LENDER’S PARTICIPATING INTEREST IN AN ADVANCE PURSUANT TO THE ABOVE PROVISIONS
OF THIS SECTION 2.17, THE FRONTING LENDER RECEIVES ANY PAYMENT ON ACCOUNT
THEREOF, THE FRONTING LENDER WILL DISTRIBUTE TO THE ADMINISTRATIVE AGENT WITH
RESPECT TO US ADVANCES AND TO THE EUROPEAN ADMINISTRATIVE AGENT WITH RESPECT TO
EUROPEAN ADVANCES, FOR THE ACCOUNT OF SUCH NON-OFFSHORE CURRENCY LENDER, SUCH
NON-OFFSHORE CURRENCY LENDER’S PARTICIPATING INTEREST IN SUCH AMOUNT
(APPROPRIATELY ADJUSTED, IN THE CASE OF INTEREST PAYMENTS, TO REFLECT THE PERIOD
OF TIME DURING WHICH SUCH NON-OFFSHORE CURRENCY LENDER’S PARTICIPATING INTEREST
WAS OUTSTANDING AND FUNDED) IN LIKE FUNDS RECEIVED; PROVIDED, HOWEVER, THAT IN
THE EVENT THAT ANY SUCH PAYMENT RECEIVED BY THE FRONTING LENDER IS REQUIRED TO
BE RETURNED, SUCH NON-OFFSHORE CURRENCY LENDER WILL RETURN TO THE FRONTING
LENDER ANY PORTION THEREOF PREVIOUSLY DISTRIBUTED BY THE FRONTING LENDER TO THE
NON-OFFSHORE CURRENCY LENDER IN LIKE FUNDS AS SUCH PAYMENT IS REQUIRED TO BE
RETURNED BY THE FRONTING LENDER.

 

(F)                                    OBLIGATIONS UNCONDITIONAL REGARDING
FRONTED LOANS.  EACH NON-OFFSHORE CURRENCY LENDER’S OBLIGATION TO PURCHASE
PARTICIPATING INTERESTS PURSUANT TO THIS SECTION 2.17 SHALL BE ABSOLUTE AND
UNCONDITIONAL AND SHALL NOT BE AFFECTED BY ANY CIRCUMSTANCE, INCLUDING (I) ANY
SET-OFF, COUNTERCLAIM, RECOUPMENT, DEFENSE OR OTHER RIGHT WHICH SUCH LENDER MAY
HAVE AGAINST THE FRONTING LENDER, ANY LOAN PARTY OR ANY OTHER PERSON FOR ANY
REASON WHATSOEVER; (II) THE OCCURRENCE AND CONTINUATION OF ANY DEFAULT OR EVENT
OF DEFAULT; (III) ANY ADVERSE CHANGE IN THE CONDITION (FINANCIAL OR OTHERWISE)
OF ANY PERSON PARTY HERETO; (IV) ANY BREACH OF ANY OF THE LOAN DOCUMENTS BY ANY
PERSON; OR (V) ANY OTHER CIRCUMSTANCE, HAPPENING OR EVENT WHATSOEVER, WHETHER OR
NOT SIMILAR TO ANY OF THE FOREGOING.

 

(G)                                 RESIGNATION OF FRONTING LENDER.   THE
FRONTING LENDER MAY RESIGN AS SUCH UPON 60 DAYS NOTICE TO THE LENDERS AND THE
ADMINISTRATIVE BORROWER.  IF THE FRONTING LENDER RESIGNS UNDER THIS AGREEMENT,
THE REQUIRED LENDERS SHALL, SO LONG AS NO EVENT OF DEFAULT HAS OCCURRED AND IS
CONTINUING IN CONSULTATION WITH ADMINISTRATIVE BORROWER, APPOINT A SUCCESSOR
FRONTING LENDER FOR THE LENDERS.  IF NO SUCCESSOR FRONTING LENDER SHALL HAVE
BEEN SO APPOINTED BY THE REQUIRED LENDERS AND SHALL HAVE ACCEPTED SUCH
APPOINTMENT WITHIN THIRTY 30 DAYS AFTER THE RETIRING FRONTING LENDER’S GIVING OF
NOTICE OF RESIGNATION, THEN THE RETIRING FRONTING LENDER SHALL, ON BEHALF OF THE
LENDERS SO LONG AS NO EVENT OF DEFAULT HAS OCCURRED AND IS CONTINUING IN
CONSULTATION WITH ADMINISTRATIVE BORROWER, APPOINT A SUCCESSOR FRONTING LENDER. 
UPON THE ACCEPTANCE OF ANY APPOINTMENT AS FRONTING LENDER HEREUNDER BY A

 

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SUCCESSOR FRONTING LENDER SUCH SUCCESSOR FRONTING LENDER SHALL THEREUPON SUCCEED
TO AND BECOME VESTED WITH ALL THE RIGHTS, POWERS, PRIVILEGES AND DUTIES OF THE
RETIRING FRONTING LENDER AND THE RETIRING FRONTING LENDER SHALL BE DISCHARGED
FROM ITS DUTIES AND OBLIGATIONS HEREUNDER. AFTER ANY RETIRING FRONTING LENDER’S
RESIGNATION, THE PROVISIONS OF THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS SHALL
CONTINUE IN EFFECT FOR ITS BENEFIT IN RESPECT OF ANY ACTIONS TAKEN OR OMITTED TO
BE TAKEN BY IT WHILE IT WAS ACTING AS FRONTING LENDER.

 

3.                                      CONDITIONS; TERM OF AGREEMENT.

 

3.1.                            CONDITIONS PRECEDENT TO THE INITIAL EXTENSION OF
CREDIT.

 

This Agreement shall be effective upon the fulfillment, to the satisfaction of
Administrative Agent and each Lender, of each of the conditions precedent set
forth on Schedule 3.1.

 

3.2.                            CONDITIONS PRECEDENT TO ALL EXTENSIONS OF
CREDIT.

 

The obligation of the Lender Group (or any member thereof) to make any Advances
hereunder at any time (or to extend any other credit hereunder) shall be subject
to the following conditions precedent:

 

(A)                                  THE REPRESENTATIONS AND WARRANTIES
CONTAINED IN THIS AGREEMENT OR IN THE OTHER LOAN DOCUMENTS SHALL BE TRUE AND
CORRECT IN ALL MATERIAL RESPECTS ON AND AS OF THE DATE OF SUCH EXTENSION OF
CREDIT, AS THOUGH MADE ON AND AS OF SUCH DATE (EXCEPT TO THE EXTENT THAT SUCH
REPRESENTATIONS AND WARRANTIES RELATE SOLELY TO AN EARLIER DATE);

 

(B)                                 NO DEFAULT OR EVENT OF DEFAULT SHALL HAVE
OCCURRED AND BE CONTINUING ON THE DATE OF SUCH EXTENSION OF CREDIT, NOR SHALL
EITHER RESULT FROM THE MAKING THEREOF;

 

(C)                                  NO INJUNCTION, WRIT, RESTRAINING ORDER, OR
OTHER ORDER OF ANY NATURE RESTRICTING OR PROHIBITING, DIRECTLY OR INDIRECTLY,
THE EXTENDING OF SUCH CREDIT SHALL HAVE BEEN ISSUED AND REMAIN IN FORCE BY ANY
GOVERNMENTAL AUTHORITY AGAINST ANY BORROWER, ANY AGENT, ANY LENDER, OR ANY OF
THEIR AFFILIATES; AND

 

(D)                                 NO MATERIAL ADVERSE CHANGE SHALL HAVE
OCCURRED SINCE THE DATE OF THE LATEST FINANCIAL STATEMENTS SUBMITTED TO
ADMINISTRATIVE AGENT ON OR BEFORE THE CLOSING DATE.

 

3.3.                            TERM.

 

This Agreement shall continue in full force and effect for a term ending on
August 19, 2010 (the “Maturity Date”).  The foregoing notwithstanding, the
Lender Group, upon the election of the Required Lenders, shall have the right to
terminate its obligations under this Agreement immediately and without notice
upon the occurrence and during the continuation of an Event of Default.

 

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3.4.                            EFFECT OF TERMINATION.

 

On the date of termination of this Agreement, all Obligations (including
contingent reimbursement obligations of Borrowers with respect to outstanding
Letters of Credit and including all Bank Product Obligations other than any Bank
Product Obligations that, at such time, are allowed by the applicable Bank
Product Provider to remain outstanding and are not required to be repaid or cash
collateralized by the applicable Bank Product Provider) immediately shall become
due and payable without notice or demand (including (a) (i) providing cash
collateral to be held by Collateral Agent for the benefit of those Lenders with
a Revolver Commitment in an amount equal to 105% of the Letter of Credit Usage,
(ii) causing the original Letters of Credit to be returned to the Issuing
Lenders or (iii) providing the applicable Issuing Lender with a letter of credit
issued by a financial institution reasonably satisfactory to such Issuing Lender
in a face amount equal to 105% of the aggregate face amount of all extant
Letters of Credit issued by such Issuing Lender, and (b) providing cash
collateral (in an amount determined by Collateral Agent as sufficient to satisfy
the reasonably estimated credit exposure) to be held by Collateral Agent for the
benefit of the Bank Product Providers with respect to the Bank Product
Obligations other than any Bank Product Obligations that, at such time, are
allowed by the applicable Bank Product Provider to remain outstanding and are
not required to be repaid or cash collateralized by the applicable Bank Product
Provider).  Such cash collateral shall be provided (i) with respect to any
Letter of Credit Usage denominated in Canadian Dollars, in Canadian Dollars,
(ii) with respect to any Letter of Credit Usage denominated in an Approved
Offshore Currency, in the applicable Approved Offshore Currency, and (iii) with
respect to any Letter of Credit Usage denominated in Dollars, in Dollars.  No
termination of this Agreement, however, shall relieve or discharge Loan Parties
of their duties, Obligations, or covenants hereunder or under any other Loan
Document and the Agent’s Liens in the Collateral shall remain in effect until
all Obligations have been paid in full (or collateralized as provided above) and
the Lender Group’s obligations to provide additional credit hereunder have been
terminated.  When this Agreement has been terminated and all of the Obligations
have been paid in full (or collateralized as provided above) and the Lender
Group’s obligations to provide additional credit under the Loan Documents have
been terminated irrevocably, Collateral Agent will, at Borrowers’ sole expense,
return to Borrowers any possessory Collateral held in its possession, execute
and deliver any termination statements, lien releases, mortgage releases,
re-assignments of trademarks, discharges of security interests, and other
similar discharge or release documents (and, if applicable, in recordable form)
as are reasonably necessary to release, as of record, the Agent’s Liens and all
notices of security interests and liens previously filed by Collateral Agent
with respect to the Obligations; provided, however, that the Foreign Borrowers
shall only be responsible for the expenses of the Collateral Agent relating to
the Foreign Obligations and the security held therefor.

 

3.5.                            EARLY TERMINATION BY BORROWERS.

 

Borrowers have the option, at any time upon 15 days (or such lesser period as
agreed by the Administrative Agent) prior written notice by Administrative
Borrower to Administrative Agent, to terminate this Agreement by paying to the
applicable Agent, in

 

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cash, the Obligations (including (a) (i) providing cash collateral to be held by
Collateral Agent for the benefit of those Lenders with a Revolver Commitment in
an amount equal to 105% of the Letter of Credit Usage, (ii) causing the original
Letters of Credit to be returned to the Issuing Lenders or (iii) providing the
applicable Issuing Lender with a letter of credit issued by a financial
institution reasonably satisfactory to such Issuing Lender in a face amount
equal to 105% of the aggregate face amount of all extant Letters of Credit
issued by such Issuing Lender, and (b) providing cash collateral (in an amount
determined by Collateral Agent as sufficient to satisfy the reasonably estimated
credit exposure) to be held by Collateral Agent for the benefit of the Bank
Product Providers with respect to the Bank Products Obligations other than any
Bank Product Obligations that, at such time, are allowed by the applicable Bank
Product Provider to remain outstanding and are not required to be repaid or cash
collateralized by the applicable Bank Product Provider) in full.  If
Administrative Borrower has sent a notice of termination pursuant to the
provisions of this Section, then the Commitments shall terminate and Borrowers
shall be obligated to repay the Obligations (including (a) (i) providing cash
collateral to be held by Collateral Agent for the benefit of those Lenders with
a Revolver Commitment in an amount equal to 105% of the Letter of Credit Usage,
(ii) causing the original Letters of Credit to be returned to the Issuing
Lenders or (iii) providing the applicable Issuing Lender with a letter of credit
issued by a financial institution reasonably satisfactory to such Issuing Lender
in a face amount equal to 105% of the aggregate face amount of all extant
Letters of Credit issued by such Issuing Lender, and (b) providing cash
collateral (in an amount determined by Collateral Agent as sufficient to satisfy
the reasonably estimated credit exposure) to be held by Collateral Agent for the
benefit of the Bank Product Providers with respect to the Bank Products
Obligations other than any Bank Product Obligations that, at such time, are
allowed by the applicable Bank Product Provider to remain outstanding and are
not required to be repaid or cash collateralized by the applicable Bank Product
Provider), in full on the date set forth as the date of termination of this
Agreement in such notice.  Cash collateral provided with respect to Letter of
Credit Usage shall be required to be provided (i) with respect to any Letter of
Credit Usage denominated in Canadian Dollars, in Canadian Dollars, (ii) with
respect to any Letter of Credit Usage denominated in an Approved Offshore
Currency, in the applicable Approved Offshore Currency, and (iii) with respect
to any Letter of Credit Usage denominated in Dollars, in Dollars.

 

4.                                      REPRESENTATIONS AND WARRANTIES.

 

In order to induce the Lender Group to enter into this Agreement, each Borrower
makes the following representations and warranties to the Lender Group which
shall be true, correct, and complete, in all material respects, as of the date
hereof, and shall be true, correct, and complete, in all material respects, as
of the Closing Date, and at and as of the date of the making of each Advance (or
other extension of credit) made thereafter, as though made on and as of the date
of such Advance (or other extension of credit) (except to the extent that such
representations and warranties relate solely to an earlier date) and such
representations and warranties shall survive the execution and delivery of this
Agreement:

 

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4.1.                            NO ENCUMBRANCES.

 

Each Loan Party and each Significant Subsidiary has good title to, or a valid
leasehold interest in, its material personal property assets and good and
marketable title to, or a valid leasehold interest in, its material Real
Property, in each case, free and clear of Liens except for Permitted Liens.

 

4.2.                            ELIGIBLE ACCOUNTS.

 

As to each Account that is identified by a Borrower as an Eligible Account or an
Eligible Unbilled Account in a borrowing base report submitted to Administrative
Agent, (a) such Account is a bona fide existing payment obligation of the
applicable Account Debtors created by the sale and delivery of goods or the
rendition of services to such Account Debtors in the ordinary course of such
Borrower’s business, (b) the portion of such Account identified as an Eligible
Account or an Eligible Unbilled Account is owed to Borrowers without any known
defenses, disputes, offsets, counterclaims, or rights of return or cancellation,
and (c) such Account is, with respect to Eligible US Accounts, not excluded as
ineligible by virtue of one or more of the excluding criteria set forth in the
definition of Eligible US Accounts, with respect to Eligible Foreign Accounts,
not excluded as ineligible by virtue of one or more of the excluding criteria
set forth in the definition of Eligible Foreign Accounts, with respect to
Eligible Unbilled US Accounts, not excluded as ineligible by virtue of one or
more of the excluding criteria set forth in the definition of Eligible Unbilled
US Accounts, and with respect to Eligible Unbilled Foreign Accounts, not
excluded as ineligible by virtue of one or more of the excluding criteria set
forth in the definition of Eligible Unbilled Foreign Accounts.

 

4.3.                            [INTENTIONALLY OMITTED].

 

4.4.                            EQUIPMENT.

 

Each material item of Equipment of Loan Parties and the Significant Subsidiaries
is used or held for use in their business and is in good working order, ordinary
wear and tear and damage by casualty excepted.

 

4.5.                            LOCATION OF INVENTORY AND EQUIPMENT.

 

The Inventory and Equipment (other than vehicles or Equipment out for repair) of
Loan Parties and the Significant Subsidiaries are located only at, or in-transit
between, the locations identified on Schedule 4.5 (as such Schedule may be
updated pursuant to Section 5.8(a)) or locations (i) not in existence on the
Closing Date and not then required to be disclosed pursuant to Section 5.8(a),
or (ii) at which there are not more than 100 seats and at which the aggregate
book value of all assets at such location does not exceed $750,000.

 

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4.6.                            INVENTORY RECORDS.

 

Each Loan Party and Significant Subsidiary keeps records that are correct and
accurate in all material respects itemizing and describing the type, quality,
and quantity of its Inventory and the book value thereof.

 

4.7.                            STATE OF INCORPORATION; LOCATION OF CHIEF
EXECUTIVE OFFICE; ORGANIZATIONAL IDENTIFICATION NUMBER; COMMERCIAL TORT CLAIMS.

 

(A)                                  THE JURISDICTION OF ORGANIZATION OR
CONTINUANCE OF EACH LOAN PARTY AND EACH SIGNIFICANT SUBSIDIARY IS SET FORTH ON
SCHEDULE 4.7(A) EXCEPT TO THE EXTENT SUCH JURISDICTION OF ORGANIZATION OR
CONTINUANCE HAS CHANGED PURSUANT TO A TRANSACTION PERMITTED BY SECTION 6.3(A) OR
(B).

 

(B)                                 AS OF THE CLOSING DATE, THE CHIEF EXECUTIVE
OFFICE OF EACH LOAN PARTY AND EACH SIGNIFICANT SUBSIDIARY IS LOCATED AT THE
ADDRESS INDICATED ON SCHEDULE 4.7(B).

 

(C)                                  EACH LOAN PARTY’S AND EACH SIGNIFICANT
SUBSIDIARY’S ORGANIZATIONAL IDENTIFICATION NUMBER, IF ANY, (OR, IN THE CASE OF
THE CANADIAN BORROWERS, THE BUSINESS NUMBER ASSIGNED BY CANADA REVENUE AGENCY
(CANADA), IF ANY) IS IDENTIFIED ON SCHEDULE 4.7(C) (AS SUCH SCHEDULE MAY BE
UPDATED BY NOTICE TO ADMINISTRATIVE AGENT).

 

(D)                                 AS OF THE CLOSING DATE, LOAN PARTIES DO NOT,
TO THEIR KNOWLEDGE, HOLD ANY COMMERCIAL TORT CLAIMS INVOLVING A CLAIM OF MORE
THAN $500,000, EXCEPT AS SET FORTH ON SCHEDULE 4.7(D).

 

4.8.                            DUE ORGANIZATION AND QUALIFICATION;
SUBSIDIARIES.

 

(A)                                  EACH BORROWER IS DULY ORGANIZED AND
EXISTING AND, IF APPLICABLE, IN GOOD STANDING UNDER THE LAWS OF THE JURISDICTION
OF ITS ORGANIZATION AND QUALIFIED TO DO BUSINESS IN ANY STATE, PROVINCE OR
TERRITORY WHERE THE FAILURE TO BE SO QUALIFIED REASONABLY COULD BE EXPECTED TO
RESULT IN A MATERIAL ADVERSE CHANGE.

 

(B)                                 SET FORTH ON SCHEDULE 4.8(B), IS A COMPLETE
AND ACCURATE DESCRIPTION AS OF THE CLOSING DATE OF THE AUTHORIZED CAPITAL STOCK
OF EACH BORROWER, BY CLASS, AND, AS OF THE CLOSING DATE, A DESCRIPTION OF THE
NUMBER OF SHARES OF EACH BORROWER (OTHER THAN THE PARENT) OF EACH SUCH CLASS
THAT ARE ISSUED AND OUTSTANDING.  OTHER THAN AS DESCRIBED ON SCHEDULE 4.8(B), AS
OF THE CLOSING DATE, THERE ARE NO SUBSCRIPTIONS, OPTIONS, WARRANTS, OR CALLS
RELATING TO ANY SHARES OF EACH BORROWER’S (OTHER THAN PARENT’S) CAPITAL STOCK,
INCLUDING ANY RIGHT OF CONVERSION OR EXCHANGE UNDER ANY OUTSTANDING SECURITY OR
OTHER INSTRUMENT.  OTHER THAN AS DESCRIBED ON SCHEDULE 4.8(B) AND OTHER THAN THE
OBLIGATION TO CONVERT OR EXCHANGE INDEBTEDNESS WITH RESPECT TO A CONVERTIBLE
NOTE OFFERING TO STOCK, NO BORROWER IS SUBJECT TO ANY OBLIGATION (CONTINGENT OR
OTHERWISE) TO REPURCHASE OR OTHERWISE ACQUIRE OR RETIRE ANY SHARES OF ITS
CAPITAL STOCK OR ANY SECURITY CONVERTIBLE INTO OR EXCHANGEABLE FOR ANY OF ITS
CAPITAL STOCK.

 

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(C)                                  SET FORTH ON SCHEDULE 4.8(C), IS A COMPLETE
AND ACCURATE LIST OF EACH BORROWER’S DIRECT AND INDIRECT SUBSIDIARIES AS OF THE
CLOSING DATE, SHOWING: (I) THE JURISDICTION OF THEIR ORGANIZATION, (II) THE
NUMBER OF SHARES OF EACH CLASS OF COMMON AND PREFERRED STOCK AUTHORIZED FOR EACH
OF SUCH SUBSIDIARIES, AND (III) THE PERCENTAGE OF THE OUTSTANDING SHARES OF EACH
SUCH CLASS OWNED DIRECTLY OR INDIRECTLY BY THE APPLICABLE BORROWER.  ALL OF THE
OUTSTANDING CAPITAL STOCK OF EACH SUCH SUBSIDIARY HAS BEEN VALIDLY ISSUED AND,
IF APPLICABLE, IS FULLY PAID AND NON-ASSESSABLE.

 

(D)                                 EXCEPT AS SET FORTH ON SCHEDULE 4.8(C), AS
OF THE CLOSING DATE, THERE ARE NO SUBSCRIPTIONS, OPTIONS, WARRANTS, OR CALLS
RELATING TO ANY SHARES OF ANY BORROWER’S SUBSIDIARIES’ CAPITAL STOCK, INCLUDING
ANY RIGHT OF CONVERSION OR EXCHANGE UNDER ANY OUTSTANDING SECURITY OR OTHER
INSTRUMENT.  NO BORROWER OR ANY OF ITS RESPECTIVE SUBSIDIARIES IS SUBJECT TO ANY
OBLIGATION (CONTINGENT OR OTHERWISE) TO REPURCHASE OR OTHERWISE ACQUIRE OR
RETIRE (I) ANY SHARES OF ANY BORROWER’S SUBSIDIARIES’ CAPITAL STOCK OR (II) ANY
SECURITY CONVERTIBLE INTO OR EXCHANGEABLE FOR ANY SUCH CAPITAL STOCK.

 

4.9.                            DUE AUTHORIZATION; NO CONFLICT.

 

(A)                                  AS TO EACH BORROWER, THE EXECUTION,
DELIVERY, AND PERFORMANCE BY SUCH BORROWER OF THIS AGREEMENT AND THE OTHER LOAN
DOCUMENTS TO WHICH IT IS A PARTY HAVE BEEN DULY AUTHORIZED BY ALL NECESSARY
ACTION ON THE PART OF SUCH BORROWER.

 

(B)                                 AS TO EACH BORROWER, THE EXECUTION,
DELIVERY, AND PERFORMANCE BY SUCH BORROWER OF THIS AGREEMENT AND THE OTHER LOAN
DOCUMENTS TO WHICH IT IS A PARTY DO NOT AND WILL NOT (I) VIOLATE ANY PROVISION
OF FEDERAL, STATE, OR LOCAL LAW OR REGULATION APPLICABLE TO SUCH BORROWER, THE
GOVERNING DOCUMENTS OF SUCH BORROWER, OR ANY ORDER, JUDGMENT, OR DECREE OF ANY
COURT OR OTHER GOVERNMENTAL AUTHORITY BINDING ON SUCH BORROWER, (II) CONFLICT
WITH, RESULT IN A BREACH OF, OR CONSTITUTE (WITH DUE NOTICE OR LAPSE OF TIME OR
BOTH) A DEFAULT UNDER ANY MATERIAL CONTRACTUAL OBLIGATION OF SUCH BORROWER
(OTHER THAN A CONFLICT WITH, OR BREACH OF, THE TERM B DEBT DOCUMENTS ARISING
DURING THE CONTINUANCE OF AN EVENT OF DEFAULT SOLELY AS A RESULT OF
ADMINISTRATIVE AGENT ELECTING PURSUANT TO SECTION 2.4(D) THAT ANY PAYMENT TO BE
OTHERWISE PAID TO TERM B AGENT IN ACCORDANCE WITH SECTION 2.4(D) FOR APPLICATION
TO THE OUTSTANDING PRINCIPAL AMOUNT OF TERM B DEBT SHALL BE APPLIED IN THE
MANNER SET FORTH IN SECTION 2.4(B)(I)(A)), (III) RESULT IN OR REQUIRE THE
CREATION OR IMPOSITION OF ANY LIEN OF ANY NATURE WHATSOEVER UPON ANY PROPERTIES
OR ASSETS OF SUCH BORROWER, OTHER THAN PERMITTED LIENS, OR (IV) REQUIRE ANY
APPROVAL OF ANY OF SUCH BORROWER’S INTERESTHOLDERS OR ANY APPROVAL OR CONSENT OF
ANY PERSON UNDER ANY MATERIAL CONTRACTUAL OBLIGATION OF SUCH BORROWER, OTHER
THAN CONSENTS OR APPROVALS THAT HAVE BEEN OBTAINED AND THAT ARE STILL IN FORCE
AND EFFECT.

 

(C)                                  OTHER THAN THE FILING OF FINANCING
STATEMENTS AND INTELLECTUAL PROPERTY SECURITY AGREEMENTS AND ANY FILINGS AND
REGISTRATIONS REQUIRED TO BE MADE TO PERFECT AGENT’S LIENS IN THE FOREIGN
COLLATERAL, AND CONTINUATIONS THEREOF, AND THE RECORDATION OF THE MORTGAGES, THE
EXECUTION, DELIVERY, AND PERFORMANCE BY EACH BORROWER OF THIS AGREEMENT AND THE
OTHER LOAN DOCUMENTS TO WHICH SUCH BORROWER IS A PARTY DO NOT AND WILL NOT
REQUIRE ANY REGISTRATION WITH, CONSENT, OR APPROVAL OF, OR NOTICE TO, OR OTHER
ACTION WITH OR BY, ANY

 

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GOVERNMENTAL AUTHORITY, OTHER THAN CONSENTS OR APPROVALS THAT HAVE BEEN OBTAINED
AND THAT ARE STILL IN FORCE AND EFFECT.

 

(D)                                 AS TO EACH BORROWER, THIS AGREEMENT AND THE
OTHER LOAN DOCUMENTS TO WHICH SUCH BORROWER IS A PARTY, AND ALL OTHER DOCUMENTS
CONTEMPLATED HEREBY AND THEREBY, WHEN EXECUTED AND DELIVERED BY SUCH BORROWER
WILL BE THE LEGALLY VALID AND BINDING OBLIGATIONS OF SUCH BORROWER, ENFORCEABLE
AGAINST SUCH BORROWER IN ACCORDANCE WITH THEIR RESPECTIVE TERMS, EXCEPT AS
ENFORCEMENT MAY BE LIMITED BY EQUITABLE PRINCIPLES OR BY BANKRUPTCY, INSOLVENCY,
REORGANIZATION, MORATORIUM, OR SIMILAR LAWS RELATING TO OR LIMITING CREDITORS’
RIGHTS GENERALLY.

 

(E)                                  [INTENTIONALLY OMITTED]

 

(F)                                    THE EXECUTION, DELIVERY, AND PERFORMANCE
BY EACH GUARANTOR OF THE LOAN DOCUMENTS TO WHICH IT IS A PARTY HAVE BEEN DULY
AUTHORIZED BY ALL NECESSARY ACTION ON THE PART OF SUCH GUARANTOR.

 

(G)                                 THE EXECUTION, DELIVERY, AND PERFORMANCE BY
EACH GUARANTOR OF THE LOAN DOCUMENTS TO WHICH IT IS A PARTY DO NOT AND WILL NOT
(I) VIOLATE ANY PROVISION OF FEDERAL, STATE, OR LOCAL LAW OR REGULATION
APPLICABLE TO SUCH GUARANTOR, THE GOVERNING DOCUMENTS OF SUCH GUARANTOR, OR ANY
ORDER, JUDGMENT, OR DECREE OF ANY COURT OR OTHER GOVERNMENTAL AUTHORITY BINDING
ON SUCH GUARANTOR, (II) CONFLICT WITH, RESULT IN A BREACH OF, OR CONSTITUTE
(WITH DUE NOTICE OR LAPSE OF TIME OR BOTH) A DEFAULT UNDER ANY MATERIAL
CONTRACTUAL OBLIGATION OF SUCH GUARANTOR (OTHER THAN A CONFLICT WITH, OR BREACH
OF, THE TERM B DEBT DOCUMENTS ARISING DURING THE CONTINUANCE OF AN EVENT OF
DEFAULT SOLELY AS A RESULT OF ADMINISTRATIVE AGENT ELECTING PURSUANT TO
SECTION 2.4(D) THAT ANY PAYMENT TO BE OTHERWISE PAID TO TERM B AGENT IN
ACCORDANCE WITH SECTION 2.4(D) FOR APPLICATION TO THE OUTSTANDING PRINCIPAL
AMOUNT OF TERM B DEBT SHALL BE APPLIED IN THE MANNER SET FORTH IN
SECTION 2.4(B)(I)(A)), (III) RESULT IN OR REQUIRE THE CREATION OR IMPOSITION OF
ANY LIEN OF ANY NATURE WHATSOEVER UPON ANY PROPERTIES OR ASSETS OF SUCH
GUARANTOR, OTHER THAN PERMITTED LIENS, OR (IV) REQUIRE ANY APPROVAL OF SUCH
GUARANTOR’S INTERESTHOLDERS OR ANY APPROVAL OR CONSENT OF ANY PERSON UNDER ANY
MATERIAL CONTRACTUAL OBLIGATION OF SUCH GUARANTOR, OTHER THAN CONSENTS OR
APPROVALS THAT HAVE BEEN OBTAINED AND THAT ARE STILL IN FORCE AND EFFECT.

 

(H)                                 OTHER THAN THE FILING OF FINANCING
STATEMENTS AND INTELLECTUAL PROPERTY SECURITY AGREEMENTS AND ANY FILINGS AND
REGISTRATIONS REQUIRED TO BE MADE TO PERFECT AGENT’S LIENS IN THE FOREIGN
COLLATERAL, AND CONTINUATIONS THEREOF, THE EXECUTION, DELIVERY, AND PERFORMANCE
BY EACH GUARANTOR OF THE LOAN DOCUMENTS TO WHICH SUCH GUARANTOR IS A PARTY DO
NOT AND WILL NOT REQUIRE ANY REGISTRATION WITH, CONSENT, OR APPROVAL OF, OR
NOTICE TO, OR OTHER ACTION WITH OR BY, ANY GOVERNMENTAL AUTHORITY, OTHER THAN
CONSENTS OR APPROVALS THAT HAVE BEEN OBTAINED AND THAT ARE STILL IN FORCE AND
EFFECT.

 

(I)                                     THE LOAN DOCUMENTS TO WHICH EACH
GUARANTOR IS A PARTY, AND ALL OTHER DOCUMENTS CONTEMPLATED HEREBY AND THEREBY,
WHEN EXECUTED AND DELIVERED BY SUCH GUARANTOR WILL BE THE LEGALLY VALID AND
BINDING OBLIGATIONS OF SUCH GUARANTOR, ENFORCEABLE AGAINST SUCH GUARANTOR IN
ACCORDANCE WITH THEIR RESPECTIVE TERMS, EXCEPT AS ENFORCEMENT MAY

 

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BE LIMITED BY EQUITABLE PRINCIPLES OR BY BANKRUPTCY, INSOLVENCY, REORGANIZATION,
MORATORIUM, OR SIMILAR LAWS RELATING TO OR LIMITING CREDITORS’ RIGHTS GENERALLY.

 

4.10.                     LITIGATION.

 

Other than those matters disclosed on Schedule 4.10, and other than matters that
reasonably could not be expected to result in a Material Adverse Change, there
are no actions, suits, or proceedings pending or, to the best knowledge of each
Borrower, threatened against any Loan Party or any Significant Subsidiary.

 

4.11.                     NO MATERIAL ADVERSE CHANGE.

 

All financial statements relating to Borrowers and their Subsidiaries that have
been delivered by Borrowers to the Lender Group have been prepared in accordance
with GAAP (except, in the case of unaudited financial statements, for the lack
of footnotes and being subject to year-end audit adjustments) and present fairly
in all material respects, Borrowers’ and their Subsidiaries’ financial condition
as of the date thereof and results of operations for the period then ended. 
There has not been a Material Adverse Change since the date of the latest
financial statements submitted to Administrative Agent on or before the Closing
Date.

 

4.12.                     FRAUDULENT TRANSFER.

 

(A)                                  EACH BORROWER IS SOLVENT.

 

(B)                                 NO TRANSFER OF PROPERTY IS BEING MADE BY ANY
LOAN PARTY AND NO OBLIGATION IS BEING INCURRED BY ANY LOAN PARTY IN CONNECTION
WITH THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT OR THE OTHER LOAN DOCUMENTS
WITH THE INTENT TO HINDER, DELAY, OR DEFRAUD EITHER PRESENT OR FUTURE CREDITORS
OF SUCH LOAN PARTY.

 

4.13.                     EMPLOYEE BENEFITS.

 

(A)                                  NONE OF LOAN PARTIES, THE SIGNIFICANT
SUBSIDIARIES, OR ANY OF THEIR ERISA AFFILIATES MAINTAINS OR CONTRIBUTES TO ANY
BENEFIT PLAN, AND, EXCEPT AS SET FORTH IN SCHEDULE 4.13, NONE OF LOAN PARTIES
NOR THE SIGNIFICANT SUBSIDIARIES TO WHICH CANADIAN EMPLOYEE BENEFITS LEGISLATION
APPLIES HAS MAINTAINED, CONTRIBUTED OR CURRENTLY MAINTAINS OR CONTRIBUTES TO ANY
BENEFIT PLAN.

 

(B)                                 EXCEPT AS SET FORTH IN SCHEDULE 4.13, NO
CANADIAN BORROWER HAS, OR IS SUBJECT TO, ANY PRESENT OR FUTURE MATERIAL
OBLIGATION OR LIABILITY UNDER, ANY PENSION PLAN, RETIREMENT INCOME PLAN, STOCK
OPTION OR STOCK PURCHASE PLAN, PROFIT SHARING PLAN, OR BONUS PLAN, WITH RESPECT
TO ITS EMPLOYEES.

 

(C)                                  SCHEDULE 4.13 LISTS ALL THE MATERIAL
EMPLOYEE BONUS, PENSION, PROFIT SHARING, STOCK COMPENSATION, STOCK PURCHASE,
RETIREMENT, AND SIMILAR PLANS OR ARRANGEMENTS OR PRACTICES RELATING TO THE
EMPLOYEES OR FORMER EMPLOYEES OF EACH CANADIAN BORROWER

 

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WHICH ARE CURRENTLY MAINTAINED OR WERE MAINTAINED AT ANY TIME IN THE FIVE
CALENDAR YEARS PRECEDING THE CLOSING DATE (THE “CANADIAN EMPLOYEE PLANS”).

 

(D)                                 ALL OF THE CANADIAN EMPLOYEE PLANS ARE AND
HAVE BEEN ESTABLISHED, REGISTERED, QUALIFIED, INVESTED AND ADMINISTERED IN ALL
MATERIAL RESPECTS IN ACCORDANCE WITH ALL LAWS APPLICABLE TO THE CANADIAN
EMPLOYEE PLANS.  NO MATERIAL FACT OR CIRCUMSTANCE EXISTS THAT COULD ADVERSELY
AFFECT THE TAX-EXEMPT STATUS OF A CANADIAN EMPLOYEE PLAN.

 

(E)                                  ALL MATERIAL OBLIGATIONS REGARDING THE
CANADIAN EMPLOYEE PLANS HAVE BEEN SATISFIED, THERE ARE NO MATERIAL OUTSTANDING
DEFAULTS OR VIOLATIONS BY ANY PARTY TO ANY CANADIAN EMPLOYEE PLAN AND NO
MATERIAL TAXES, PENALTIES OR FEES ARE OWING OR ELIGIBLE UNDER ANY OF THE
CANADIAN EMPLOYEE PLANS.

 

4.14.                     ENVIRONMENTAL CONDITION.

 

Except as could not reasonably be expected to result in a Material Adverse
Change or as set forth on Schedule 4.14, (a) to Borrowers’ knowledge, none of
Loan Parties’ or the Significant Subsidiaries’ properties or assets has ever
been used by Loan Parties, the Significant Subsidiaries, or by previous owners
or operators in the disposal of, or to produce, store, handle, treat, release,
or transport, any Hazardous Materials, where such use, production, storage,
handling, treatment, release or transport was in violation, in any material
respect, of any applicable Environmental Law, (b) to Borrowers’ knowledge, none
of Loan Parties’ nor the Significant Subsidiaries’ properties or assets has been
designated or identified in any manner pursuant to any environmental protection
statute as a Hazardous Materials disposal site, (c) none of Loan Parties nor the
Significant Subsidiaries have received notice that a Lien arising under any
Environmental Law has attached to any revenues or to any Real Property owned or
operated by Loan Parties or the Significant Subsidiaries, and (d) none of Loan
Parties nor the Significant Subsidiaries have received a summons, citation,
notice, or directive from the United States Environmental Protection Agency or
any other federal or state governmental agency concerning any action or omission
by any Loan Party or any Significant Subsidiary resulting in the releasing or
disposing of Hazardous Materials into the environment.

 

4.15.                     INTELLECTUAL PROPERTY.

 

Each Loan Party owns, or holds licenses in, all trademarks, trade names,
copyrights, patents, patent rights, and licenses that are necessary to the
conduct of its business as currently conducted, and attached hereto as
Schedule 4.15 (as updated from time to time) is a true, correct, and complete
listing of all material patents, patent applications, trademarks, trademark
applications, copyrights, and copyright registrations as to which any US Loan
Party is the owner or is an exclusive licensee.

 

4.16.                     LEASES.

 

Loan Parties and the Significant Subsidiaries enjoy peaceful and undisturbed
possession under all leases material to their business and to which they are
parties or under

 

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which they are operating and all of such material leases are valid and
subsisting and no material default by Loan Parties and the Significant
Subsidiaries exists under any of them.

 

4.17.                     DEPOSIT ACCOUNTS AND SECURITIES ACCOUNTS.

 

Set forth on Schedule 4.17 is a listing of all of Loan Parties’ Deposit Accounts
and Securities Accounts as of the Closing Date, including, with respect to each
bank or securities intermediary (a) the name and address of such Person, and
(b) the account numbers of the Deposit Accounts or Securities Accounts
maintained with such Person.

 

4.18.                     COMPLETE DISCLOSURE.

 

All factual information (taken as a whole) furnished by or on behalf of
Borrowers or their Subsidiaries in writing to any Agent or any Lender (including
all information contained in the Schedules hereto or in the other Loan
Documents, as updated from time to time in accordance with the terms of the Loan
Documents) for purposes of or in connection with this Agreement, the other Loan
Documents, or any transaction contemplated herein or therein is, and all other
such factual information (taken as a whole) hereafter furnished by or on behalf
of Borrowers or their Subsidiaries in writing to any Agent or any Lender will
be, true and accurate in all material respects on the date as of which such
information is dated or certified and not incomplete by omitting to state any
fact necessary to make such information (taken as a whole) not misleading in any
material respect at such time in light of the circumstances under which such
information was provided; provided, that any projections and forecasts shall be
subject to the next sentence.  On the Closing Date, the Closing Date Projections
represent, and as of the date on which any other Projections are delivered to
Administrative Agent, such additional Projections represent, Borrowers’ good
faith estimate of their and their Subsidiaries’ future performance for the
periods covered thereby (it being understood that such projections and forecasts
are subject to significant uncertainties and contingencies, many of which are
beyond the control of the Borrowers and that no assurance can be given that such
projections or forecasts will be realized).

 

4.19.                     INDEBTEDNESS.

 

Set forth on Schedule 4.19 is a true and complete list of all Indebtedness
(other than Indebtedness permitted under Section 6.1 (other than clause
(b) thereof)) of each Loan Party and each Significant Subsidiary outstanding
immediately prior to the Closing Date that is to remain outstanding after the
Closing Date and such Schedule accurately reflects the aggregate principal
amount of such Indebtedness and describes the maturity date thereof as of the
Closing Date.

 

4.20.                     WITHHOLDINGS AND REMITTANCES.

 

Each Canadian Borrower has withheld from each payment made to any of its present
or former employees, officers and directors, and to all persons who are
non-residents of Canada for the purposes of the Canadian Income Tax Act all
material amounts required by Applicable Law to be withheld, including all
payroll deductions required to be withheld, and

 

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furthermore, has remitted, where applicable, such withheld amounts within the
prescribed periods to the appropriate Governmental Authority.  Such Canadian
Borrower has remitted all Canadian Pension Plan contributions, provincial
pension plan contributions, workers compensation assessments, employment
insurance premiums, employer health taxes, municipal real estate taxes and other
taxes payable under the Applicable Law by it (the “Statutory Lien Payments”) and
has remitted such amounts to the proper Governmental Authority within the time
required under the Applicable Law, save and except for contributions,
assessments, premiums and taxes which are the subject of Permitted Protests.

 

4.21.                     PAYMENTS TO EMPLOYEES AND OTHERS.

 

Each Canadian Borrower has paid or accrued as a liability on its books and will
pay, all material payments due from it to any employee, independent contractor,
Person or Governmental Authority on account of wages, workers’ compensation or
other compensation and, as applicable, employee health and welfare insurance and
other benefits.

 

4.22.                     TERM B DEBT DOCUMENTS.

 

Borrowers have delivered to Administrative Agent true and correct copies of the
Term B Debt Documents.  The transactions contemplated by the Term B Debt
Documents will be, contemporaneously with the Closing Date, consummated in
accordance with their respective terms.  All of the representations and
warranties of the US Borrowers in the Term B Debt Documents are true and correct
in all material respects.

 

5.                                      AFFIRMATIVE COVENANTS.

 

Each Borrower covenants and agrees that, until termination of all of the
Commitments and payment in full of the Obligations, Borrowers shall and shall
cause each other Loan Party and each Significant Subsidiary to do all of the
following:

 

5.1.                            ACCOUNTING SYSTEM.

 

Maintain a system of accounting that enables Borrowers to produce financial
statements in accordance with GAAP and maintain records pertaining to the
Collateral that contain information as from time to time reasonably may be
requested by Administrative Agent.  Borrowers also shall keep a reporting system
that shows all additions, sales, claims, returns, and allowances with respect to
their sales (it being understood that Borrowers’ reporting system as in effect
on the Closing Date shall be deemed to satisfy the requirements of this
sentence).

 

5.2.                            COLLATERAL REPORTING.

 

Provide Administrative Agent (and if so requested by Administrative Agent, with
copies for each Lender) with each of the reports set forth on Schedule 5.2 at
the times specified therein.  In addition, each Borrower agrees to cooperate
fully with Administrative Agent to facilitate and implement a system of
electronic collateral reporting in order to provide electronic reporting of each
of the items set forth on Schedule 5.2, it being

 

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understood that the system of electronic reporting used by Borrowers on the
Closing Date is acceptable to Administrative Agent.

 

5.3.                            FINANCIAL STATEMENTS, REPORTS, CERTIFICATES.

 

Deliver to Administrative Agent, with copies for each Lender, each of the
financial statements, reports, or other items set forth on Schedule 5.3 at the
time specified therein.  In addition, Parent agrees that no Loan Party will have
a fiscal year different from that of Parent.  Parent and Borrowers agree to
cooperate with Administrative Agent to allow Administrative Agent to consult
with its independent certified public accountants if Administrative Agent
reasonably requests the right to do so and that, in such connection, its
independent certified public accountants are authorized to communicate with
Administrative Agent and to release to Administrative Agent whatever financial
information concerning the Loan Parties and the Significant Subsidiaries that
Administrative Agent reasonably may request.

 

5.4.                            INSPECTION.

 

Permit Administrative Agent and, if an Event of Default shall have occurred and
be continuing, any Lender, and each of their duly authorized representatives or
agents to visit any of its properties and inspect any of its assets or books and
records, to examine and make copies of its books and records, and to discuss its
affairs, finances, and accounts with, and to be advised as to the same by, its
officers, employees handling financial matters and managerial employees at such
reasonable times and intervals during normal business hours as Administrative
Agent or any such Lender may designate and, so long as no Default or Event of
Default exists, with reasonable prior notice to Administrative Borrower.

 

5.5.                            MAINTENANCE OF PROPERTIES.

 

Maintain and preserve all of their properties which are necessary or useful in
the proper conduct of their business in good working order and condition,
ordinary wear, tear, and casualty excepted, in each case except where the
failure to do so could not reasonably be expected to result in a Material
Adverse Change.  Comply at all times with the provisions of all material leases
to which it is a party as lessee, so as to prevent any loss or forfeiture
thereof or thereunder except to the extent the subject of a Permitted Protest or
except where the failure to do so could not reasonably be expected to result in
a Material Adverse Change.

 

5.6.                            TAXES.

 

Cause all assessments and taxes, whether real, personal, or otherwise, due or
payable by, or imposed, levied, or assessed against Borrowers, the other Loan
Parties, the Significant Subsidiaries, or any of their respective assets to be
paid in full, before delinquency or before the expiration of any extension
period, except to the extent that (a) the validity of such assessment or tax
shall be the subject of a Permitted Protest or (b) the aggregate amount of all
such unpaid past due (taking into account any extensions) taxes that

 

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are not the subject of a Permitted Protest (other than with respect to taxes due
to any taxing authority in the United States or any state thereof or the
District of Columbia) does not exceed, at any one time, $100,000.  Borrowers
will and will cause the other Loan Parties and the Significant Subsidiaries to
make timely payment or deposit of all withholding taxes, social security and
unemployment taxes required of them by Applicable Laws, including the Canadian
Income Tax Act, Statutory Lien Payments and those laws concerning F.I.C.A.,
F.U.T.A., and state disability, except to the extent that the validity of such
assessment or tax shall be the subject of a Permitted Protest, and will, upon
request, furnish Administrative Agent with proof reasonably satisfactory to
Administrative Agent indicating that the applicable Borrower, Loan Party or
Significant Subsidiary has made such payments or deposits.

 

5.7.                            INSURANCE.

 

(A)                                  AT BORROWERS’ EXPENSE, MAINTAIN INSURANCE
RESPECTING THEIR AND THEIR SUBSIDIARIES’ ASSETS WHEREVER LOCATED, COVERING LOSS
OR DAMAGE BY FIRE, THEFT, EXPLOSION, AND ALL OTHER HAZARDS AND RISKS AS
ORDINARILY ARE INSURED AGAINST BY OTHER PERSONS ENGAGED IN THE SAME OR SIMILAR
BUSINESSES; PROVIDED, THAT NO BORROWER SHALL BE REQUIRED TO MAINTAIN INSURANCE
WITH RESPECT TO LEASED REAL PROPERTY IF THE LANDLORD THEREOF MAINTAINS SUCH
INSURANCE.  BORROWERS ALSO SHALL MAINTAIN BUSINESS INTERRUPTION, AND PUBLIC
LIABILITY INSURANCE, AS WELL AS INSURANCE AGAINST LARCENY, EMBEZZLEMENT, AND
CRIMINAL MISAPPROPRIATION.  ALL SUCH POLICIES OF INSURANCE SHALL BE IN SUCH
AMOUNTS AND WITH SUCH INSURANCE COMPANIES (OR WITH RESPECT TO HEALTH INSURANCE
AND WORKERS COMPENSATION INSURANCE, SELF INSURANCE PROGRAMS) AS ARE REASONABLY
SATISFACTORY TO COLLATERAL AGENT.  BORROWERS SHALL DELIVER COPIES OF ALL SUCH
POLICIES TO COLLATERAL AGENT WITH AN ENDORSEMENT NAMING COLLATERAL AGENT AS THE
SOLE (OTHER THAN THE TERM B AGENT) LOSS PAYEE (UNDER A SATISFACTORY LENDER’S
LOSS PAYABLE ENDORSEMENT) OR ADDITIONAL INSURED, AS APPROPRIATE.  EACH POLICY OF
INSURANCE OR ENDORSEMENT SHALL CONTAIN A CLAUSE REQUIRING THE INSURER TO GIVE
NOT LESS THAN 30 DAYS PRIOR WRITTEN NOTICE TO COLLATERAL AGENT IN THE EVENT OF
CANCELLATION OF THE POLICY FOR ANY REASON WHATSOEVER, OR OTHERWISE ACCEPTABLE TO
COLLATERAL AGENT.

 

(B)                                 ADMINISTRATIVE BORROWER SHALL GIVE
COLLATERAL AGENT PROMPT NOTICE OF ANY PROPERTY OR CASUALTY LOSS IN A DOLLAR
EQUIVALENT AMOUNT EXCEEDING $500,000 COVERED BY SUCH INSURANCE.  SO LONG AS NO
EVENT OF DEFAULT HAS OCCURRED AND IS CONTINUING, BORROWERS SHALL HAVE THE
EXCLUSIVE RIGHT TO ADJUST ANY LOSSES PAYABLE UNDER ANY SUCH INSURANCE POLICIES
WHICH ARE IN A DOLLAR EQUIVALENT AMOUNT LESS THAN $1,000,000.  FOLLOWING THE
OCCURRENCE AND DURING THE CONTINUATION OF AN EVENT OF DEFAULT, OR IN THE CASE OF
ANY LOSSES PAYABLE UNDER SUCH INSURANCE IN A DOLLAR EQUIVALENT AMOUNT EXCEEDING
$1,000,000, COLLATERAL AGENT SHALL HAVE THE EXCLUSIVE RIGHT TO ADJUST ANY LOSSES
PAYABLE UNDER ANY SUCH INSURANCE POLICIES, WITHOUT ANY LIABILITY TO BORROWERS
WHATSOEVER IN RESPECT OF SUCH ADJUSTMENTS.  ANY MONIES RECEIVED AS PAYMENT FOR
ANY LOSS UNDER ANY INSURANCE POLICY OF A US BORROWER MENTIONED ABOVE (OTHER THAN
LIABILITY INSURANCE POLICIES) OR AS PAYMENT OF ANY AWARD OR COMPENSATION FOR
CONDEMNATION OR TAKING BY EMINENT DOMAIN, SHALL BE PAID OVER TO COLLATERAL AGENT
TO BE APPLIED TO THE PREPAYMENT OF THE OBLIGATIONS IN ACCORDANCE WITH
SECTION 2.4 OR TO BE DISBURSED TO ADMINISTRATIVE BORROWER FOR APPLICATION TO THE
COST OF REPAIRS, REPLACEMENTS, RESTORATIONS OR ACQUISITIONS IN ACCORDANCE WITH
SECTION 2.4.

 

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5.8.                            LOCATION OF INVENTORY AND EQUIPMENT.

 

(A)                                  KEEP LOAN PARTIES’ INVENTORY AND EQUIPMENT
(OTHER THAN VEHICLES AND EQUIPMENT OUT FOR REPAIR AND ITEMS IN TRANSIT) ONLY AT
THE LOCATIONS IDENTIFIED ON SCHEDULE 4.5 OR LOCATIONS (I) NOT IN EXISTENCE ON
THE CLOSING DATE AND NOT THEN REQUIRED TO BE DISCLOSED PURSUANT TO THE FOLLOWING
PROVISO, OR (II) AT WHICH THERE ARE NOT MORE THAN 100 SEATS AND AT WHICH THE
AGGREGATE BOOK VALUE OF ALL ASSETS AT SUCH LOCATION DOES NOT EXCEED $750,000;
PROVIDED, HOWEVER, THAT ADMINISTRATIVE BORROWER MAY AMEND SCHEDULE 4.5 (IT BEING
UNDERSTOOD THAT THE ADMINISTRATIVE BORROWER SHALL, TO THE EXTENT NECESSARY,
UPDATE SUCH SCHEDULE AS PART OF THE QUARTERLY COMPLIANCE CERTIFICATE FOR THE
SECOND FISCAL QUARTER OF EACH FISCAL YEAR, AS PART OF THE ANNUAL COMPLIANCE
CERTIFICATE AND UPON THE REQUEST OF ADMINISTRATIVE AGENT), SO LONG AS ANY SUCH
NEW LOCATION OF A US BORROWER IS WITHIN THE CONTINENTAL UNITED STATES AND ANY
SUCH NEW LOCATION OF A FOREIGN BORROWER IS WITHIN THE CONTINENTAL UNITED STATES,
IRELAND, UNITED KINGDOM, GERMANY OR CANADA, AND SO LONG AS, WITH RESPECT TO ANY
SUCH LOCATION AT WHICH A US BORROWER’S BOOKS AND RECORDS ARE LOCATED, AT THE
TIME OF SUCH WRITTEN NOTIFICATION, THE APPLICABLE US BORROWER USES COMMERCIALLY
REASONABLE EFFORTS TO OBTAIN A COLLATERAL ACCESS AGREEMENT WITH RESPECT THERETO.

 

(B)                                 KEEP LOAN PARTIES’ AND SIGNIFICANT
SUBSIDIARIES’ CHIEF EXECUTIVE OFFICES ONLY AT THE LOCATIONS IDENTIFIED ON
SCHEDULE 4.7(B); PROVIDED, HOWEVER, THAT ADMINISTRATIVE BORROWER MAY CHANGE ANY
LOAN PARTY’S OR ANY SIGNIFICANT SUBSIDIARY’S CHIEF EXECUTIVE OFFICE AND NOTIFY
ADMINISTRATIVE AGENT OF SUCH CHANGE OF A LOAN PARTY’S OR SUCH SIGNIFICANT
SUBSIDIARY’S CHIEF EXECUTIVE OFFICE (I) 30 DAYS PRIOR TO THE DATE ON WHICH SUCH
CHIEF EXECUTIVE OFFICE IS RELOCATED TO THE EXTENT ANY BORROWER’S BOOKS AND
RECORDS ARE LOCATED AT SUCH OFFICE OR (II) OTHERWISE AS PART OF THE QUARTERLY
COMPLIANCE CERTIFICATE FOR THE SECOND FISCAL QUARTER OF EACH FISCAL YEAR, AS
PART OF THE ANNUAL COMPLIANCE CERTIFICATE AND UPON THE REQUEST OF ADMINISTRATIVE
AGENT, IN EACH CASE SO LONG AS ANY SUCH NEW LOCATION OF A US LOAN PARTY IS
WITHIN THE CONTINENTAL UNITED STATES AND ANY SUCH NEW LOCATION OF A FOREIGN LOAN
PARTY IS WITHIN THE CONTINENTAL UNITED STATES, IRELAND, UNITED KINGDOM, GERMANY
OR CANADA, AND SO LONG AS, WITH RESPECT TO ANY SUCH LOCATION AT WHICH A US
BORROWER’S BOOKS AND RECORDS ARE LOCATED, AT THE TIME OF SUCH WRITTEN
NOTIFICATION, THE APPLICABLE US BORROWER USES COMMERCIALLY REASONABLE EFFORTS TO
OBTAIN A COLLATERAL ACCESS AGREEMENT WITH RESPECT THERETO.

 

5.9.                            COMPLIANCE WITH LAWS.

 

Comply with the requirements of all Applicable Laws, rules, regulations, and
orders of any Governmental Authority, other than Laws, rules, regulations, and
orders the non-compliance with which, individually or in the aggregate, could
not reasonably be expected to result in a Material Adverse Change.

 

5.10.                     LEASES.

 

Pay when due all rents and other amounts payable under any material leases to
which any Loan Party or any Significant Subsidiary is a party or by which any
Loan Party’s or any Significant Subsidiary’s properties and assets are bound,
unless such payments are the

 

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subject of a Permitted Protest or failure to make such payments could not
reasonably be expected to result in a Material Adverse Change.

 

5.11.                     EXISTENCE.

 

At all times preserve and keep in full force and effect each Loan Party’s and
each Significant Subsidiary’s (a) valid existence and, if applicable, good
standing in its jurisdiction of organization and (b) qualifications to do
business as a foreign entity in each jurisdiction in which it is required to be
so qualified and any rights and franchises material to their businesses except
to the extent (i) permitted under Section 6.3 or 6.4 or (ii) failure to maintain
such qualifications, rights or franchises could not reasonably be expected to
result in a Material Adverse Change.

 

5.12.                     ENVIRONMENTAL.

 

(a) Except as could not reasonably be expected to result in a Material Adverse
Change, keep any property either owned or operated by any Borrower or any
Subsidiary of a Borrower free of any Environmental Liens or post bonds or other
financial assurances sufficient to satisfy the obligations or liability
evidenced by such Environmental Liens, (b) comply with Environmental Laws except
to the extent non-compliance could not reasonably be expected to result in a
Material Adverse Change and provide to Administrative Agent documentation of
such compliance which Administrative Agent reasonably requests, (c) promptly
upon obtaining knowledge thereof, notify Administrative Agent of any release of
a Hazardous Material in any reportable quantity from or onto property owned or
operated by any Borrower or any Subsidiary of a Borrower that could reasonably
be expected to result in a Material Adverse Change and take any Remedial Actions
required to come into compliance with applicable Environmental Law (except to
the extent such noncompliance could not reasonably be expected to result in a
Material Adverse Change), and (d) promptly, but in any event within 10 days of
its receipt thereof, provide Administrative Agent with written notice of any of
the following:  (i) notice that an Environmental Lien has been filed against any
of the real or personal property of any Borrower or any Subsidiary of a
Borrower, (ii) commencement of any Environmental Action or notice that an
Environmental Action will be filed against any Borrower or any Subsidiary of a
Borrower, and (iii) notice of a violation, citation, or other administrative
order relating to Environmental Laws or Environmental Liabilities which
reasonably could be expected to result in a Material Adverse Change.

 

5.13.                     DISCLOSURE UPDATES.

 

Promptly and in no event later than 10 Business Days after obtaining knowledge
thereof, notify Administrative Agent if any written information, exhibit, or
report furnished on its behalf to the Lender Group contained, at the time it was
furnished, when taken together with all other information, exhibits or reports
previously furnished, any untrue statement of a material fact or omitted to
state any material fact necessary to make the statements contained therein not
misleading in any material respect in light of the circumstances in which made. 
The foregoing to the contrary notwithstanding, any

 

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notification pursuant to the foregoing provision will not cure or remedy the
effect of the prior untrue statement of a material fact or omission of any
material fact nor shall any such notification have the affect of amending or
modifying this Agreement or any of the Schedules hereto.

 

5.14.                     CONTROL AGREEMENTS.

 

Take all reasonable steps in order for Collateral Agent to obtain control in
accordance with Sections 8-106, 9-104, and 9-106 of the Code with respect to
(subject to the proviso contained in Section 6.12) all of the US Borrowers’
Securities Accounts and Deposit Accounts.  Take all reasonable steps in order
for Collateral Agent to obtain control in accordance with Applicable Law with
respect to (subject to the proviso contained in Section 6.12) all of the Foreign
Borrowers’ Securities Accounts and Deposit Accounts.  Provide written notice to
Collateral Agent of any electronic chattel paper, investment property, and
letter of credit rights of any US Loan Party and, upon the request of Collateral
Agent, take all reasonable steps in order for Collateral Agent to obtain control
in accordance with Sections 8-106, 9-105, 9-106, and 9-107 of the Code with
respect thereto, in each case to the extent required by the US Security
Agreement.  Notwithstanding anything in this Agreement or in any Control
Agreement or any other Loan Document to the contrary, Collateral Agent agrees
that unless and until an Event of Default has occurred and is continuing,
Collateral Agent shall not give the applicable bank or securities intermediary
notice instructing the bank or securities intermediary to cease honoring the
applicable Loan Party’s instructions.

 

5.15.                     FORMATION OF SUBSIDIARIES; FURTHER ASSURANCES.

 

(A)                                  AT THE TIME THAT ANY BORROWER OR ANY
GUARANTOR FORMS ANY DIRECT OR INDIRECT SUBSIDIARY OR ACQUIRES ANY DIRECT OR
INDIRECT SUBSIDIARY AFTER THE CLOSING DATE, OTHER THAN A NON-LOAN PARTY
SUBSIDIARY OR AN IMMATERIAL SUBSIDIARY, OR ANY BORROWER OR ANY GUARANTOR
DESIGNATES ANY NON-LOAN PARTY SUBSIDIARY OR ANY IMMATERIAL SUBSIDIARY TO BE A
LOAN PARTY AFTER THE CLOSING DATE, SUCH BORROWER OR SUCH GUARANTOR SHALL
(I) CAUSE SUCH NEW SUBSIDIARY (OR SUCH NEWLY DESIGNATED LOAN PARTY) CREATED OR
ORGANIZED UNDER THE LAWS OF THE UNITED STATES, IRELAND, UNITED KINGDOM, GERMANY
OR CANADA OR ANY STATE OR PROVINCE THEREOF OR THE DISTRICT OF COLUMBIA TO
PROVIDE TO ADMINISTRATIVE AGENT A JOINDER TO THIS AGREEMENT AND A SECURITY
AGREEMENT, TOGETHER WITH SUCH OTHER SECURITY DOCUMENTS (INCLUDING, IF REQUESTED
BY ADMINISTRATIVE AGENT, MORTGAGES WITH RESPECT TO ANY REAL PROPERTY OF ANY SUCH
NEW US BORROWER), AS WELL AS APPROPRIATE FINANCING STATEMENTS (AND WITH RESPECT
TO ALL PROPERTY SUBJECT TO A MORTGAGE, FIXTURE FILINGS), ALL IN FORM AND
SUBSTANCE SATISFACTORY TO ADMINISTRATIVE AGENT AND COLLATERAL AGENT (INCLUDING
BEING SUFFICIENT TO GRANT COLLATERAL AGENT A FIRST PRIORITY LIEN (SUBJECT TO
PERMITTED LIENS) IN AND TO SUBSTANTIALLY ALL OF THE ASSETS OF SUCH NEWLY FORMED
OR ACQUIRED SUBSIDIARY); PROVIDED, THAT ANY NEW SUBSIDIARY (OR SUCH NEWLY
DESIGNATED LOAN PARTY) CREATED OR ORGANIZED UNDER THE LAWS OF THE IRELAND,
UNITED KINGDOM, GERMANY OR CANADA OR ANY STATE OR PROVINCE THEREOF SHALL NOT BE
REQUIRED TO GRANT A LIEN IN ANY OF ITS ASSETS OTHER THAN ITS ACCOUNTS AND RIGHTS
RELATED THERETO, AND ANY GUARANTY OR SECURITY PROVIDED BY ANY SUCH FOREIGN
SUBSIDIARY SHALL SUPPORT ONLY THE FOREIGN OBLIGATIONS; PROVIDED, THAT ANY SUCH
PLEDGE WITH RESPECT TO THE ACCOUNTS AND RELATED RIGHTS OF

 

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A SUBSIDIARY CREATED OR ORGANIZED UNDER THE LAWS OF IRELAND, UNITED KINGDOM,
GERMANY OR CANADA OR ANY STATE OR PROVINCE THEREOF SHALL BE SUBSTANTIALLY IN THE
FORM OF THE PLEDGE PROVIDED UNDER THE LAWS OF SUCH JURISDICTION ON THE CLOSING
DATE, (II) IF SUCH BORROWER OR GUARANTOR IS A US LOAN PARTY, PROVIDE TO
COLLATERAL AGENT A PLEDGE AGREEMENT AND APPROPRIATE CERTIFICATES AND POWERS OR
FINANCING STATEMENTS, HYPOTHECATING ALL OF THE DIRECT OR BENEFICIAL OWNERSHIP
INTEREST IN SUCH NEW SUBSIDIARY (OR SUCH NEWLY DESIGNATED LOAN PARTY) CREATED OR
ORGANIZED UNDER THE LAWS OF THE UNITED STATES OR ANY STATE THEREOF OR THE
DISTRICT OF COLUMBIA OWNED DIRECTLY BY SUCH BORROWER OR GUARANTOR, IN FORM AND
SUBSTANCE REASONABLY SATISFACTORY TO COLLATERAL AGENT, (III) IF SUCH BORROWER OR
GUARANTOR IS A US LOAN PARTY, UPON THE REQUEST OF COLLATERAL AGENT, PROVIDE TO
COLLATERAL AGENT A PLEDGE AGREEMENT AND APPROPRIATE CERTIFICATES AND POWERS OR
FINANCING STATEMENTS, HYPOTHECATING 65% OF ALL OF THE TOTAL OUTSTANDING VOTING
STOCK IN SUCH NEW SUBSIDIARY (OR SUCH NEWLY DESIGNATED LOAN PARTY) CREATED OR
ORGANIZED UNDER THE LAWS OF ANY JURISDICTION OTHER THAN THE UNITED STATES OR ANY
STATE THEREOF OR THE DISTRICT OF COLUMBIA OWNED DIRECTLY BY SUCH BORROWER OR
GUARANTOR, IN FORM AND SUBSTANCE REASONABLY SATISFACTORY TO COLLATERAL AGENT, TO
SECURE THE US OBLIGATIONS; PROVIDED, THAT (X) ANY SUCH PLEDGE WITH RESPECT TO
THE STOCK OF A SUBSIDIARY CREATED OR ORGANIZED UNDER THE LAWS OF UNITED KINGDOM
OR CANADA OR ANY STATE OR PROVINCE THEREOF SHALL BE SUBSTANTIALLY IN THE FORM OF
THE PLEDGE PROVIDED UNDER THE LAWS OF SUCH JURISDICTION ON THE CLOSING DATE AND
(Y) THE ADMINISTRATIVE AGENT SHALL NOT REQUIRE ANY LEGAL OPINION WITH RESPECT TO
ANY PLEDGE WITH RESPECT TO THE STOCK OF A SUBSIDIARY CREATED OR ORGANIZED UNDER
ANY JURISDICTION OTHER THAN IRELAND, UNITED KINGDOM, GERMANY OR CANADA OR ANY
STATE OR PROVINCE THEREOF, AND (IV) PROVIDE TO ADMINISTRATIVE AGENT AND
COLLATERAL AGENT ALL OTHER DOCUMENTATION, INCLUDING (SUBJECT TO THE PROVISO IN
CLAUSE (III) ABOVE) ONE OR MORE OPINIONS OF COUNSEL SATISFACTORY TO
ADMINISTRATIVE AGENT, WHICH IN ITS OPINION IS APPROPRIATE WITH RESPECT TO THE
EXECUTION AND DELIVERY OF THE APPLICABLE DOCUMENTATION REFERRED TO ABOVE
(INCLUDING POLICIES OF TITLE INSURANCE OR OTHER DOCUMENTATION WITH RESPECT TO
ALL PROPERTY SUBJECT TO A MORTGAGE).  ANY DOCUMENT, AGREEMENT, OR INSTRUMENT
EXECUTED OR ISSUED PURSUANT TO THIS SECTION 5.15(A) SHALL BE A LOAN DOCUMENT.

 

(B)                                 UPON THE REQUEST OF COLLATERAL AGENT, EACH
US LOAN PARTY SHALL (I) PROVIDE TO COLLATERAL AGENT A PLEDGE AGREEMENT AND
APPROPRIATE CERTIFICATES AND POWERS OR FINANCING STATEMENTS, HYPOTHECATING 65%
OF ALL OF THE DIRECT OR BENEFICIAL OWNERSHIP INTEREST OF SUCH US LOAN PARTY IN
EACH NON-LOAN PARTY SUBSIDIARY, IN FORM AND SUBSTANCE SATISFACTORY TO COLLATERAL
AGENT, TO SECURE THE US OBLIGATIONS, AND (II) PROVIDE TO COLLATERAL AGENT ALL
OTHER DOCUMENTATION (EXCLUDING OPINIONS OF COUNSEL) SATISFACTORY TO COLLATERAL
AGENT, WHICH IN ITS OPINION IS NECESSARY AND APPROPRIATE WITH RESPECT TO THE
PLEDGES REFERRED TO ABOVE.  ANY DOCUMENT, AGREEMENT, OR INSTRUMENT EXECUTED OR
ISSUED PURSUANT TO THIS SECTION 5.15(B) SHALL BE A LOAN DOCUMENT.

 

5.16.                     TERM B DEBT DOCUMENTS.

 

Promptly provide Administrative Agent with true and complete copies of any and
all material documents and other material information delivered by or to any US
Loan Party pursuant to the terms of the Term B Debt Documents, except any such
documents or other information otherwise required to be delivered hereunder.

 

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6.                                      NEGATIVE COVENANTS.

 

Each Borrower covenants and agrees that, until termination of all of the
Commitments and payment in full of the Obligations, Borrowers will not and will
not permit any other Loan Party or any Significant Subsidiary to do any of the
following:

 

6.1.                            INDEBTEDNESS.

 

Create, incur, assume, suffer to exist, or otherwise become or remain, directly
or indirectly, liable with respect to, any Indebtedness, except:

 

(A)                                  INDEBTEDNESS EVIDENCED BY THIS AGREEMENT
AND THE OTHER LOAN DOCUMENTS, TOGETHER WITH INDEBTEDNESS OWED TO US UNDERLYING
ISSUERS WITH RESPECT TO US UNDERLYING LETTERS OF CREDIT, OWED TO CANADIAN
UNDERLYING ISSUERS WITH RESPECT TO CANADIAN UNDERLYING LETTERS OF CREDIT OR OWED
TO EUROPEAN UNDERLYING ISSUERS WITH RESPECT TO EUROPEAN UNDERLYING LETTERS OF
CREDIT;

 

(B)                                 INDEBTEDNESS SET FORTH ON SCHEDULE 4.19;

 

(C)                                  PERMITTED PURCHASE MONEY INDEBTEDNESS;

 

(D)                                 REFINANCINGS, RENEWALS, OR EXTENSIONS OF
INDEBTEDNESS ORIGINALLY PERMITTED UNDER CLAUSES (B) AND (O) OF THIS SECTION 6.1
(AND CONTINUANCE OR RENEWAL OF ANY PERMITTED LIENS ASSOCIATED THEREWITH) SO LONG
AS: (I) SUCH REFINANCINGS, RENEWALS, OR EXTENSIONS DO NOT RESULT IN AN INCREASE
IN THE PRINCIPAL AMOUNT OF (EXCEPT FOR INCREASES RELATED TO THE COSTS OF SUCH
ISSUANCES THAT DO NOT EXCEED 1.5% OF THE ORIGINAL PRINCIPAL AMOUNT), OR INTEREST
RATE WITH RESPECT TO, THE INDEBTEDNESS SO REFINANCED, RENEWED, OR EXTENDED OR
ADD ONE OR MORE LOAN PARTIES AS LIABLE WITH RESPECT THERETO IF SUCH ADDITIONAL
LOAN PARTIES WERE NOT LIABLE WITH RESPECT TO THE ORIGINAL INDEBTEDNESS,
(II) SUCH REFINANCINGS, RENEWALS, OR EXTENSIONS DO NOT RESULT IN A SHORTENING OF
THE AVERAGE WEIGHTED MATURITY OF THE INDEBTEDNESS SO REFINANCED, RENEWED, OR
EXTENDED, NOR ARE THEY ON TERMS OR CONDITIONS, THAT, TAKEN AS A WHOLE, ARE
MATERIALLY MORE BURDENSOME OR RESTRICTIVE TO THE APPLICABLE BORROWERS, AND
(III) IF THE INDEBTEDNESS THAT IS REFINANCED, RENEWED, OR EXTENDED WAS
SUBORDINATED IN RIGHT OF PAYMENT TO THE OBLIGATIONS, THEN THE TERMS AND
CONDITIONS OF THE REFINANCING, RENEWAL, OR EXTENSION INDEBTEDNESS MUST INCLUDE
SUBORDINATION TERMS AND CONDITIONS THAT ARE AT LEAST AS FAVORABLE TO THE LENDER
GROUP AS THOSE THAT WERE APPLICABLE TO THE REFINANCED, RENEWED, OR EXTENDED
INDEBTEDNESS;

 

(E)                                  ENDORSEMENT OF INSTRUMENTS OR OTHER PAYMENT
ITEMS FOR DEPOSIT;

 

(F)                                    INDEBTEDNESS COMPRISING PERMITTED
INVESTMENTS;

 

(G)                                 (I) GUARANTIES OF ANY INDEBTEDNESS PERMITTED
UNDER THIS SECTION 6.1 SOLELY TO THE EXTENT SUCH LOAN PARTY OR SUCH SIGNIFICANT
SUBSIDIARY WOULD BE PERMITTED TO INCUR SUCH INDEBTEDNESS UNDER THIS SECTION 6.1
AS A PRIMARY OBLIGOR (OTHER THAN PURSUANT TO THIS CLAUSE (G)) AND (II) OTHER
GUARANTEES ISSUED BY LOAN PARTIES AND SIGNIFICANT SUBSIDIARIES OF PURCHASE MONEY
INDEBTEDNESS INCURRED BY ANY SUBSIDIARY OF PARENT IN CONNECTION WITH THE

 

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ACQUISITION OF SUCH SUBSIDIARY IN AN AGGREGATE DOLLAR EQUIVALENT AMOUNT NOT TO
EXCEED $1,000,000 AT ANY ONE TIME OUTSTANDING;

 

(H)                                 (I) INDEBTEDNESS UNDER HEDGE AGREEMENTS
ENTERED INTO FOR BUSINESS AND NOT SPECULATIVE PURPOSES INCURRED IN ORDER TO
PROTECT AGAINST (A) PRICE FLUCTUATIONS WITH RESPECT TO MATERIALS USED IN OR
SERVICES PROVIDED FOR THE BUSINESS OF A BORROWER, (B) FLUCTUATIONS IN INTEREST
RATES OR (C) FLUCTUATIONS IN FOREIGN EXCHANGE RATES AND (II) INDEBTEDNESS OF
LOAN PARTIES THAT ARE NOT BORROWERS AND SIGNIFICANT SUBSIDIARIES UNDER HEDGE
AGREEMENTS ENTERED INTO FOR BUSINESS AND NOT SPECULATIVE PURPOSES INCURRED IN
ORDER TO PROTECT AGAINST (A) PRICE FLUCTUATIONS WITH RESPECT TO MATERIALS USED
IN OR SERVICES PROVIDED FOR THE BUSINESS OF A LOAN PARTY OR SIGNIFICANT
SUBSIDIARY, (B) FLUCTUATIONS IN INTEREST RATES OR (C) FLUCTUATIONS IN FOREIGN
EXCHANGE RATES;

 

(I)                                     INDEBTEDNESS IN RESPECT OF
(I) INTERCOMPANY LOANS AMONG US BORROWERS, (II) INTERCOMPANY LOANS AMONG FOREIGN
BORROWERS MADE WITH THE PROCEEDS OF FOREIGN ADVANCES AND (III) INTERCOMPANY
LOANS MADE BY A FOREIGN SUBSIDIARY TO A US BORROWER; PROVIDED, THAT (X) SUCH
INTERCOMPANY LOANS ARE EVIDENCED BY PROMISSORY NOTES, IN FORM AND SUBSTANCE
ACCEPTABLE TO COLLATERAL AGENT, AND, IN THE CASE OF NOTES EVIDENCING
INDEBTEDNESS OWED TO A US LOAN PARTY, WHICH PROMISSORY NOTES HAVE BEEN PLEDGED
TO COLLATERAL AGENT AND (Y) SUCH INTERCOMPANY LOANS ARE UNSECURED;

 

(J)                                     INDEBTEDNESS OF LOAN PARTIES AND THEIR
RESPECTIVE SUBSIDIARIES IN RESPECT OF INTERCOMPANY LOANS PERMITTED UNDER CLAUSES
(G) AND (H) OF THE DEFINITION OF PERMITTED INVESTMENTS;

 

(K)                                  INDEBTEDNESS IN AN AGGREGATE DOLLAR
EQUIVALENT AMOUNT NOT TO EXCEED $5,000,000 FOR ALL LOAN PARTIES AND SIGNIFICANT
SUBSIDIARIES AT ANY ONE TIME OUTSTANDING ARISING FROM THE HONORING BY A BANK OR
OTHER FINANCIAL INSTITUTION OF A CHECK, DRAFT OR SIMILAR INSTRUMENT
INADVERTENTLY (EXCEPT IN THE CASE OF DAYLIGHT OVERDRAFTS) DRAWN AGAINST
INSUFFICIENT FUNDS IN THE ORDINARY COURSE OF BUSINESS SO LONG AS SUCH
INDEBTEDNESS IS EXTINGUISHED WITHIN 10 BUSINESS DAYS OF THE INCURRENCE THEREOF;

 

(L)                                     INDEBTEDNESS OF SITEL IBERICA
TELESERVICES, S.A. IN AN AGGREGATE DOLLAR EQUIVALENT PRINCIPAL AMOUNT NOT TO
EXCEED $20,000,000 AT ANY TIME OUTSTANDING;

 

(M)                               THE TERM B DEBT;

 

(N)                                 INDEBTEDNESS OF ANY LOAN PARTY OR
SIGNIFICANT SUBSIDIARY IN RESPECT OF A CONVERTIBLE NOTE OFFERING, SO LONG AS THE
TERM B DEBT HAS BEEN PAID IN FULL (OR WILL BE PAID IN FULL WITH THE PROCEEDS OF
THE CONVERTIBLE NOTE OFFERING) AND, IMMEDIATELY BEFORE AND AFTER GIVING EFFECT
TO THE INCURRENCE OF SUCH CONVERTIBLE NOTE OFFERING, NO EVENT OF DEFAULT HAS
OCCURRED AND IS CONTINUING;

 

(O)                                 SO LONG AS THE TERM LOAN A AND TERM B DEBT
HAVE BEEN PAID IN FULL (OR WILL BE PAID IN FULL WITH THE PROCEEDS OF ADDITIONAL
PERMITTED DEBT), INDEBTEDNESS OF ANY LOAN PARTY OR SIGNIFICANT SUBSIDIARY IN
RESPECT OF THE ADDITIONAL PERMITTED DEBT; PROVIDED,

 

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THAT, THE PRINCIPAL AMOUNT OF INDEBTEDNESS PERMITTED UNDER THIS CLAUSE (O) SHALL
BE REDUCED BY THE OUTSTANDING PRINCIPAL AMOUNT OF ANY REFINANCINGS, RENEWALS, OR
EXTENSIONS OF SUCH INDEBTEDNESS MADE UNDER CLAUSE (D) OF THIS SECTION 6.1;

 

(P)                                 AT ANY TIME PRIOR TO THE INCURRENCE OF THE
TERM B DEBT, INDEBTEDNESS UNDER THE INDENTURE; AND

 

(Q)                                 ADDITIONAL INDEBTEDNESS OF LOAN PARTIES AND
SIGNIFICANT SUBSIDIARIES (OTHER THAN SITEL IBERICA TELESERVICES, S.A.) NOT
INCURRED IN RELIANCE ON CLAUSES (A) THROUGH (P) ABOVE IN AN AGGREGATE DOLLAR
EQUIVALENT PRINCIPAL AMOUNT THAT DOES NOT EXCEED $5,000,000 AT ANY ONE TIME
OUTSTANDING.

 

6.2.                            LIENS.

 

Create, incur, assume, or suffer to exist, directly or indirectly, any Lien on
or with respect to any of its assets, of any kind, whether now owned or
hereafter acquired, or any income or profits therefrom, except for Permitted
Liens.

 

6.3.                            RESTRICTIONS ON FUNDAMENTAL CHANGES.

 

(A)                                  ENTER INTO ANY AMALGAMATION, MERGER,
CONSOLIDATION, REORGANIZATION, OR RECAPITALIZATION, OR RECLASSIFY ITS STOCK,
EXCEPT THAT, IF AT THE TIME THEREOF AND IMMEDIATELY AFTER GIVING EFFECT THERETO
NO EVENT OF DEFAULT SHALL HAVE OCCURRED AND BE CONTINUING, (1) ANY SUBSIDIARY OF
A BORROWER MAY BE AMALGAMATED, MERGED OR CONSOLIDATED WITH OR INTO ANY LOAN
PARTY OR ANY SIGNIFICANT SUBSIDIARY (PROVIDED THAT IN ANY SUCH AMALGAMATION,
MERGER OR CONSOLIDATION INVOLVING (W) A US BORROWER, A US BORROWER SHALL BE THE
CONTINUING OR SURVIVING ENTITY, (X) A US LOAN PARTY BUT NOT A US BORROWER, A US
LOAN PARTY SHALL BE THE CONTINUING OR SURVIVING ENTITY, (Y) A FOREIGN BORROWER
BUT NOT A US LOAN PARTY, A FOREIGN BORROWER SHALL BE THE CONTINUING OR SURVIVING
ENTITY AND (Z) A FOREIGN LOAN PARTY BUT NOT A US LOAN PARTY OR A FOREIGN
BORROWER, A FOREIGN LOAN PARTY SHALL BE THE CONTINUING OR SURVIVING ENTITY) AND
(2) THE TRANSACTIONS DESCRIBED IN THE PRE-APPROVED RESTRUCTURINGS LETTER SHALL
BE PERMITTED,

 

(B)                                 LIQUIDATE, WIND UP, OR DISSOLVE ITSELF (OR
SUFFER ANY LIQUIDATION OR DISSOLUTION), EXCEPT THAT, IF AT THE TIME THEREOF AND
IMMEDIATELY AFTER GIVING EFFECT THERETO NO EVENT OF DEFAULT SHALL HAVE OCCURRED
AND BE CONTINUING, (1) A SIGNIFICANT SUBSIDIARY MAY LIQUIDATE, WIND-UP OR
DISSOLVE WITH AND INTO A SUBSIDIARY OF A BORROWER IF THE ADMINISTRATIVE BORROWER
DETERMINES IN GOOD FAITH THAT SUCH TRANSACTION IS IN THE BEST INTERESTS OF THE
ADMINISTRATIVE BORROWER, AND SUCH TRANSACTION IS NOT MATERIALLY DISADVANTAGEOUS
TO THE LENDERS; PROVIDED, THAT, A SIGNIFICANT SUBSIDIARY THAT IS NOT A FOREIGN
SUBSIDIARY MAY ONLY LIQUIDATE, WIND-UP OR DISSOLVE WITH AND INTO ANOTHER
SUBSIDIARY THAT IS NOT A FOREIGN SUBSIDIARY AND (2) THE TRANSACTIONS DESCRIBED
IN THE PRE-APPROVED RESTRUCTURINGS LETTER SHALL BE PERMITTED,

 

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(C)                                  EXCEPT AS PERMITTED UNDER SECTION 6.4,
CONVEY, SELL, LEASE, LICENSE, ASSIGN, TRANSFER, OR OTHERWISE DISPOSE OF, IN ONE
TRANSACTION OR A SERIES OF TRANSACTIONS, ALL OR ANY SUBSTANTIAL PART OF ITS
ASSETS, OR

 

(D)                                 SUSPEND OR GO OUT OF A SUBSTANTIAL PORTION
OF ITS OR THEIR BUSINESS EXCEPT (1) TO THE EXTENT SUCH SUSPENSION OR GOING OUT
OF BUSINESS COULD NOT REASONABLY BE EXPECTED TO RESULT IN A MATERIAL ADVERSE
CHANGE AND (2) THE TRANSACTIONS DESCRIBED IN THE PRE-APPROVED RESTRUCTURINGS
LETTER SHALL BE PERMITTED.

 

6.4.                            DISPOSAL OF ASSETS.

 

Other than as permitted under Section 6.3 and Permitted Dispositions, convey,
sell, lease, license, assign, transfer, or otherwise dispose of any of the
assets of any Loan Party or any Significant Subsidiary.

 

6.5.                            CHANGE NAME.

 

Except in connection with a transaction permitted pursuant to Section 6.3,
change any Loan Party’s or any Significant Subsidiary’s name, organizational
identification number, state of organization, or organizational identity;
provided, however, that a Loan Party or a Significant Subsidiary may change its
name or organizational identification number upon at least 15 Business Days
prior written notice by Administrative Borrower to Collateral Agent of such
change and so long as, at the time of such written notification, such Loan Party
or such Significant Subsidiary provides any financing statements necessary to
perfect and continue perfected the Agent’s Liens.

 

6.6.                            NATURE OF BUSINESS.

 

Make any material change in the principal nature of the business of the Loan
Parties and the Significant Subsidiaries, taken as a whole.

 

6.7.                            PREPAYMENTS AND AMENDMENTS.

 

Except in connection with a refinancing permitted by Section 6.1(c), (d), or
(n),

 

(A)                                  OPTIONALLY PREPAY, REDEEM, DEFEASE,
PURCHASE, OR OTHERWISE ACQUIRE ANY INDEBTEDNESS OF ANY LOAN PARTY OR SIGNIFICANT
SUBSIDIARY (OTHER THAN (I) THE OBLIGATIONS IN ACCORDANCE WITH THIS AGREEMENT,
(II) THE TERM B DEBT OR (III) INTERCOMPANY LOANS OWED TO US BORROWERS,
INTERCOMPANY LOANS AMONG FOREIGN BORROWERS, INTERCOMPANY LOANS AMONG US
GUARANTORS, INTERCOMPANY LOANS AMONG FOREIGN GUARANTORS, INTERCOMPANY LOANS
AMONG FOREIGN SUBSIDIARIES THAT ARE NOT LOAN PARTIES, INTERCOMPANY LOANS OWED BY
ANY US GUARANTOR TO A US BORROWER, INTERCOMPANY LOANS OWED BY ANY FOREIGN
SUBSIDIARY TO A BORROWER OR INTERCOMPANY LOANS OWED BY ANY FOREIGN SUBSIDIARY
THAT IS NOT A LOAN PARTY TO A LOAN PARTY), UNLESS (X) WITH RESPECT TO
INDEBTEDNESS OTHER THAN INTERCOMPANY INDEBTEDNESS SUBORDINATED PURSUANT TO THE
TERMS OF THE INTERCOMPANY SUBORDINATION AGREEMENT, SUCH INDEBTEDNESS HAS NOT
BEEN CONTRACTUALLY SUBORDINATED TO THE OBLIGATIONS IN RIGHT OF PAYMENT,

 

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(Y) NO EVENT OF DEFAULT SHALL HAVE OCCURRED AND BE CONTINUING OR WOULD RESULT
FROM SUCH PREPAYMENT, REDEMPTION, DEFEASEMENT, PURCHASE OR ACQUISITION AND
(Z) DAILY AVERAGE DOLLAR EQUIVALENT OF EXCESS AVAILABILITY FOR THE IMMEDIATELY
PRECEDING 30 CONSECUTIVE DAY PERIOD IS AT LEAST $15,000,000 AND, IMMEDIATELY
PRIOR TO SUCH PREPAYMENT, REDEMPTION, DEFEASEMENT, PURCHASE OR ACQUISITION AND
IMMEDIATELY AFTER GIVING EFFECT TO SUCH PREPAYMENT, REDEMPTION, DEFEASEMENT,
PURCHASE OR ACQUISITION, THE DOLLAR EQUIVALENT OF EXCESS AVAILABILITY IS AT
LEAST $15,000,000; PROVIDED, THAT, ANY LOAN PARTY OR SIGNIFICANT SUBSIDIARY MAY
MAKE OPTIONAL PREPAYMENTS OF INTERCOMPANY INDEBTEDNESS BY SET OFF (AND NOT IN
CASH) AGAINST OBLIGATIONS OWED TO SUCH LOAN PARTY OR SIGNIFICANT SUBSIDIARY BY
ANOTHER BORROWER OR SUBSIDIARY OF A BORROWER SO LONG AS NO EVENT OF DEFAULT
SHALL HAVE OCCURRED AND BE CONTINUING OR WOULD RESULT FROM SUCH SET OFF,
PROVIDED, THAT, NO FOREIGN SUBSIDIARY MAY MAKE ANY OPTIONAL PREPAYMENT OF
INTERCOMPANY INDEBTEDNESS OWED BY SUCH FOREIGN SUBSIDIARY TO A US LOAN PARTY BY
SET OFF TO THE EXTENT SUCH PREPAYMENT IS PROHIBITED IN THE DEFINITION OF
“PERMITTED INVESTMENT”,

 

(B)                                 OPTIONALLY PREPAY, REDEEM, DEFEASE,
PURCHASE, OR OTHERWISE ACQUIRE ANY TERM B DEBT, EXCEPT (I) USING THE PROCEEDS OF
A CONVERTIBLE NOTE OFFERING PERMITTED HEREUNDER OR USING THE PROCEEDS OF THE
SALE INVOLVING THE PROPERTY DESCRIBED IN, AND SUBJECT TO THE TERMS OF, THE
PRE-APPROVED ASSET DISPOSITION LETTER, IN EACH CASE TO THE EXTENT PERMITTED
UNDER SECTION 2.4(C) AND (II) USING OTHER FUNDS AVAILABLE TO SUCH PERSON UNLESS
(A) AN EVENT OF DEFAULT SHALL HAVE OCCURRED AND BE CONTINUING OR WOULD RESULT
FROM SUCH PREPAYMENT, REDEMPTION, DEFEASEMENT, PURCHASE OR ACQUISITION,
(B) AFTER GIVING EFFECT TO SUCH PREPAYMENT, REDEMPTION, DEFEASEMENT, PURCHASE OR
ACQUISITION, BORROWERS ARE NOT IN COMPLIANCE WITH THE FINANCIAL COVENANTS
INCLUDED IN SECTION 6.17 ON A PRO FORMA BASIS AS OF THE MOST RECENT MONTH END
FOR WHICH FINANCIAL STATEMENTS HAVE BEEN DELIVERED OR (C) IMMEDIATELY PRIOR TO
SUCH PREPAYMENT, REDEMPTION, DEFEASEMENT, PURCHASE OR ACQUISITION AND
IMMEDIATELY AFTER GIVING EFFECT TO SUCH PREPAYMENT, REDEMPTION, DEFEASEMENT,
PURCHASE OR ACQUISITION, DAILY AVERAGE DOLLAR EQUIVALENT OF EXCESS AVAILABILITY
FOR THE IMMEDIATELY PRECEDING 30 CONSECUTIVE DAY PERIOD IS LESS THAN $25,000,000
AND THE DOLLAR EQUIVALENT OF EXCESS AVAILABILITY AS OF SUCH DATE IS LESS THAN
$25,000,000,

 

(C)                                  MAKE ANY PAYMENT ON ACCOUNT OF INDEBTEDNESS
THAT HAS BEEN CONTRACTUALLY SUBORDINATED IN RIGHT OF PAYMENT IF SUCH PAYMENT IS
NOT PERMITTED AT SUCH TIME UNDER THE SUBORDINATION TERMS AND CONDITIONS, OR

 

(D)                                 DIRECTLY OR INDIRECTLY, AMEND, MODIFY,
ALTER, OR CHANGE ANY OF THE TERMS OR CONDITIONS OF (I) THE TERM B DEBT DOCUMENTS
TO THE EXTENT THAT THE INTERCREDITOR AGREEMENT PROHIBITS THE HOLDERS OF THE TERM
B DEBT FROM SO AMENDING, MODIFYING OR SUPPLEMENTING THE SAME OR (II) ANY
AGREEMENT, INSTRUMENT, DOCUMENT, INDENTURE, OR OTHER WRITING EVIDENCING OR
CONCERNING INDEBTEDNESS PERMITTED UNDER SECTION 6.1(B) IN A MANNER THAT IS
MATERIALLY ADVERSE TO THE LENDERS.

 

6.8.                            CHANGE OF CONTROL.

 

Cause, permit, or suffer, directly or indirectly, any Change of Control.

 

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6.9.                            [INTENTIONALLY OMITTED].

 

6.10.                     DISTRIBUTIONS.

 

Make any distribution or declare or pay any dividends (in cash or other
property) on, or purchase, acquire, redeem, or retire, any of any Borrower’s
Stock, of any class, (any of the foregoing, a “Restricted Payment”), whether now
or hereafter outstanding; provided that the following shall be permitted:
(a) Restricted Payments by a Foreign Borrower to another Borrower (including,
solely for purposes thereof, Restricted Payments to any intermediate holding
company) or by a US Borrower to another US Borrower, (b) Restricted Payments
paid solely in common Stock, (c) Restricted Payments in amounts necessary to
permit a Borrower to repurchase Stock of such Borrower from employees of such
Borrower or another Borrower upon the termination of their employment, so long
as no Default or Event of Default exists at the time of or would be caused by
the making of such Restricted Payment and so long as the aggregate Dollar
Equivalent amount of all such Restricted Payments for all Borrowers made
pursuant to this clause (c) does not exceed $2,000,000 during any fiscal year of
Borrowers, and (d) commencing on the date the Term Loan A has been repaid in
full, so long as (i) either the Term B Debt has been repaid in full or the
holders of the Term B Debt have consented to any such Restricted Payment under
the Term B Debt Documents, (ii) no Event of Default exists or would result from
the making of any such Restricted Payments and (iii) immediately prior to the
making of any such Restricted Payments and immediately after giving effect to
the making of any such Restricted Payments, daily average Dollar Equivalent of
Excess Availability for the immediately preceding 30 consecutive day period is
at least $15,000,000 and the Dollar Equivalent of Excess Availability as of such
date is at least $15,000,000, Restricted Payments by Borrowers in an aggregate
Dollar Equivalent amount not exceeding $5,000,000 with respect to all such
Restricted Payments made pursuant to this clause (d) made by all Borrowers
within any fiscal year of Borrowers.

 

6.11.                     ACCOUNTING METHODS.

 

Modify or change their fiscal year or their method of accounting (other than as
may be required to conform to GAAP) or enter into, modify, or terminate any
agreement currently existing, or at any time hereafter entered into, with any
third party accounting firm or service bureau for the preparation or storage of
Borrowers’ or their Subsidiaries’ accounting records without said accounting
firm or service bureau agreeing to provide Administrative Agent information
regarding Borrowers’ and their Subsidiaries’ financial condition.

 

6.12.                     INVESTMENTS.

 

Except for Permitted Investments, directly or indirectly, make or acquire any
Investment; provided, however, that US Borrowers shall not have Permitted
Investments (other than in the Deposit Accounts and Securities Accounts subject
to Control Agreements and Excluded Deposit Accounts) in Deposit Accounts or
Securities Accounts in an aggregate Dollar Equivalent amount in excess of
$500,000 at any one time and the Borrowers shall not

 

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have Permitted Investments (other than in the Deposit Accounts and Securities
Accounts subject to Control Agreements and Excluded Deposit Accounts) in Deposit
Accounts or Securities Accounts in an aggregate Dollar Equivalent amount in
excess of $5,000,000 at any one time unless the applicable Borrower and the
applicable securities intermediary or bank have entered into Control Agreements
governing such Permitted Investments in order to perfect (and further establish)
the Agent’s Liens in such Permitted Investments.  Subject to the foregoing
proviso, Borrowers shall not establish or maintain any Deposit Account or
Securities Account unless Collateral Agent shall have received a Control
Agreement in respect of such Deposit Account or Securities Account.

 

6.13.                     TRANSACTIONS WITH AFFILIATES.

 

Directly or indirectly enter into or permit to exist any transaction with any
Affiliate of any Borrower except:

 

(I)                                     TRANSACTIONS THAT (A) ARE UPON FAIR AND
REASONABLE TERMS, (B) IF THEY INVOLVE ONE OR MORE PAYMENTS BY ANY BORROWER OR
ANY OF ITS SUBSIDIARIES WHICH ARE IN A DOLLAR EQUIVALENT AMOUNT IN EXCESS OF
$250,000 FOR ANY SINGLE TRANSACTION OR SERIES OF TRANSACTIONS, ARE FULLY
DISCLOSED TO ADMINISTRATIVE AGENT, AND (C) ARE NO LESS FAVORABLE TO BORROWERS OR
THEIR RESPECTIVE SUBSIDIARIES, AS APPLICABLE, THAN WOULD BE OBTAINED IN AN ARM’S
LENGTH TRANSACTION WITH A NON-AFFILIATE;

 

(II)                                  INTERCOMPANY LOANS AMONG LOAN PARTIES AND
THEIR SUBSIDIARIES PERMITTED UNDER SECTION 6.1, INVESTMENTS PERMITTED UNDER
SECTION 6.12 OR ANY TRANSACTION EXPRESSLY PERMITTED UNDER SECTION 6.2, 6.3, 6.4
OR 6.10;

 

(III)                               TRANSACTIONS AMONG LOAN PARTIES AND
TRANSACTIONS AMONG SIGNIFICANT SUBSIDIARIES;

 

(IV)                              REASONABLE DIRECTOR’S FEES FOR ANY DIRECTOR;

 

(V)                                 INDEMNIFICATION ARRANGEMENTS FOR DIRECTORS,
OFFICERS, EMPLOYEES OR CONSULTANTS;

 

(VI)                              ANY ARRANGEMENTS AS IN EFFECT AS OF THE DATE
OF THIS AGREEMENT AND DESCRIBED ON SCHEDULE 6.13 HERETO OR ANY TRANSACTION
CONTEMPLATED THEREBY (INCLUDING PURSUANT TO AN AMENDMENT THERETO OR ANY
REPLACEMENT AGREEMENT THERETO SO LONG AS ANY AMENDMENT OR REPLACEMENT AGREEMENT
IS NOT MORE DISADVANTAGEOUS TO THE ADMINISTRATIVE AGENT AND LENDERS IN ANY
MATERIAL RESPECT THAN THE ORIGINAL AGREEMENT ON THE DATE OF THIS AGREEMENT);

 

(VII)                           TRANSACTIONS IN THE ORDINARY COURSE OF BUSINESS
BETWEEN AND AMONG LOAN PARTIES AND SUBSIDIARIES OF PARENT IN CONNECTION WITH
SUBCONTRACTOR ARRANGEMENTS AND GUARANTEES OF ORDINARY COURSE OBLIGATIONS OF
SUBSIDIARIES OF PARENT NOT CONSTITUTING INDEBTEDNESS; AND

 

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(VIII)                        MANAGEMENT FEES PAYABLE TO US BORROWERS AND
MANAGEMENT FEES PAYABLE BY ANY FOREIGN SUBSIDIARY TO ANY FOREIGN BORROWER
ORGANIZED IN THE UNITED KINGDOM.

 

6.14.                     USE OF PROCEEDS.

 

Use the proceeds of the Advances for any purpose other than (a) on the Closing
Date, (i) to repay in full the outstanding principal, accrued interest, and
accrued fees and expenses owing to Existing Lender, and (ii) to pay
transactional fees, costs, and expenses incurred in connection with this
Agreement, the other Loan Documents, and the transactions contemplated hereby
and thereby, and (b) thereafter, consistent with the terms and conditions
hereof, for its lawful and permitted purposes.  Use the proceeds of the Term
Loan A for any purpose other than, together with the proceeds of Advances and
the Term B Debt, to repay in full the outstanding principal, accrued interest,
and accrued fees and expenses evidenced by the Indenture.

 

6.15.                     SITEL MEXICO HOLDINGS LLC AND SITMEX-USA, LLC

 

Permit SITEL Mexico Holdings LLC, a Nebraska limited liability company, or
SITMEX-USA, LLC, a Delaware limited liability company, to engage in any
business, other than acting as a holding company and transactions incidental
thereto, the making of Investments in Persons that are not Loan Parties, the
performance of ministerial activities and the payment of taxes and
administrative fees and expenses; provided, that the transactions described in
the Pre-approved Restructurings Letter shall be permitted to the extent such
transactions are consummated on the terms set forth in the Pre-approved
Restructurings Letter.

 

6.16.                     NON-LOAN PARTY SUBSIDIARIES; IMMATERIAL SUBSIDIARIES.

 

(A)                                  PERMIT (I) ANY LIENS (OTHER THAN AGENT’S
LIENS AND LIENS IN FAVOR OF TERM B AGENT, IF ANY) ON THE CAPITAL STOCK OF ANY
NON-LOAN PARTY SUBSIDIARY, (II)  THE NON-LOAN PARTY SUBSIDIARIES TO (A) INCUR
ANY INDEBTEDNESS (OTHER THAN INTERCOMPANY LOANS PERMITTED UNDER SECTION 6.12) IN
AN AGGREGATE AMOUNT AT ANY TIME OUTSTANDING IN EXCESS OF $7,000,000 LESS ANY
OUTSTANDING INDEBTEDNESS INCURRED IN RELIANCE ON CLAUSE (Q) OF SECTION 6.1, OR
(B) INCUR ANY LIENS OTHER THAN LIENS THAT WOULD CONSTITUTE PERMITTED LIENS IF
ALL SUCH SUBSIDIARIES WERE DEEMED TO BE SIGNIFICANT SUBSIDIARIES OR
(III) (A) THE AGGREGATE REVENUE OF ALL NON-LOAN PARTY SUBSIDIARIES FOR ANY
FISCAL QUARTER TO EXCEED THE MAXIMUM NON-LOAN PARTY PERCENTAGE OF THE AGGREGATE
REVENUE OF ADMINISTRATIVE BORROWER AND ITS SUBSIDIARIES FOR SUCH FISCAL QUARTER
OR (B) THE REVENUE OF ALL NON-LOAN PARTY SUBSIDIARIES ORGANIZED UNDER THE LAWS
OF ANY SINGLE JURISDICTION FOR ANY FISCAL QUARTER TO EXCEED 2.5% OF THE
AGGREGATE REVENUE OF ADMINISTRATIVE BORROWER AND ITS SUBSIDIARIES FOR SUCH
FISCAL QUARTER; PROVIDED, THAT, ANY FAILURE OF BORROWERS TO COMPLY WITH THIS
CLAUSE (III) SHALL NOT CONSTITUTE A BREACH OF THIS AGREEMENT IF, ON OR PRIOR TO
THE EARLIER OF (X) 10 DAYS OF SUCH FAILURE BECOMING KNOWN TO AN OFFICER OF
ADMINISTRATIVE BORROWER AND (Y) THE DATE OF ADMINISTRATIVE BORROWER’S FILING OF
ITS QUARTERLY REPORT ON FORM 10-Q FOR ANY FISCAL QUARTER, ADMINISTRATIVE
BORROWER DESIGNATES IN A WRITTEN NOTICE CERTAIN NON-LOAN PARTY SUBSIDIARIES TO
BE LOAN PARTIES OR SIGNIFICANT

 

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SUBSIDIARIES SUCH THAT, AFTER GIVING EFFECT TO SUCH DESIGNATION, ON A PRO FORMA
BASIS, BORROWERS SHALL BE IN COMPLIANCE WITH THIS CLAUSE (III), SO LONG AS
IMMEDIATELY AFTER GIVING EFFECT THERETO NO DEFAULT OR EVENT OF DEFAULT SHALL
HAVE OCCURRED AND BE CONTINUING.

 

(B)                                 PERMIT ANY IMMATERIAL SUBSIDIARY TO
(I) ENGAGE IN ANY TYPE OF BUSINESS ACTIVITY OR (II) OWN ASSETS WITH A FAIR
MARKET VALUE IN EXCESS OF $250,000.

 

6.17.                     FINANCIAL COVENANTS.

 

(A)                                  AT ANY TIME PRIOR TO THE COVENANT
SUSPENSION DATE AND AT ANY TIME ON OR AFTER THE OCCURRENCE OF A COVENANT EVENT,
FAIL TO MAINTAIN OR ACHIEVE:

 

(I)                                     MINIMUM EBITDA.  EBITDA, MEASURED ON A
MONTH-END BASIS, OF AT LEAST THE REQUIRED AMOUNT SET FORTH IN THE FOLLOWING
TABLE FOR THE APPLICABLE PERIOD SET FORTH OPPOSITE THERETO:

 

Applicable Period

 

Applicable Amount

 

For the 12 month periods ending August 31, 2005 and September 30, 2005

 

$

44,000,000

 

For the 12 month period ending each month thereafter

 

$

45,000,000

 

 

(II)                                  FIXED CHARGE COVERAGE RATIO.  A FIXED
CHARGE COVERAGE RATIO, MEASURED ON A MONTH-END BASIS, OF AT LEAST THE REQUIRED
RATIO SET FORTH IN THE FOLLOWING TABLE FOR THE APPLICABLE PERIOD SET FORTH
OPPOSITE THERETO:

 

Applicable Ratio

 

Applicable Period

 

1.0:1.0

 

For the 12 month periods
ending August 31, 2005 and September 30, 2005

 

1.1:1.0

 

For the 12 month period
ending each month thereafter

 

 

(III)                               LEVERAGE RATIO.  A LEVERAGE RATIO, MEASURED
ON A QUARTER-END BASIS, OF NOT MORE THAN THE RATIO SET FORTH IN THE FOLLOWING
TABLE FOR THE APPLICABLE PERIOD SET FORTH OPPOSITE THERETO:

 

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Applicable Ratio

 

Applicable Period

 

2.75:1.0

 

For the 4 fiscal quarters
ending September 30, 2005 and December 31, 2005

 

2.50:1.0

 

For the 4 fiscal quarters
ending March 31, 2006

 

2.25:1.0

 

For the 4 fiscal quarters
ending June 30, 2006

 

2.00:1.0

 

For the 4 fiscal quarters
ending each fiscal quarter thereafter

 

 

(B)                                 CAPITAL EXPENDITURES.  MAKE, OR PERMIT ANY
SUBSIDIARY OF PARENT TO MAKE, CAPITAL EXPENDITURES IN ANY FISCAL YEAR, (I) AT
ANY TIME PRIOR TO THE COVENANT SUSPENSION DATE, (II)(A) AT ANY TIME ON OR AFTER
THE OCCURRENCE OF A COVENANT EVENT OR (B) IF A COVENANT EVENT WOULD OCCUR UPON
THE MAKING OF SUCH CAPITAL EXPENDITURES, THAT WOULD CAUSE THE AGGREGATE AMOUNT
OF ALL CAPITAL EXPENDITURES MADE BY THE PARENT AND ITS SUBSIDIARIES TO EXCEED
THE AMOUNT SET FORTH IN THE FOLLOWING TABLE FOR THE APPLICABLE PERIOD:

 

Fiscal Year

 

Amount

 

2005

 

$

40,000,000

 

2006

 

$

42,000,000

 

2007

 

$

44,000,000

 

2008

 

$

46,000,000

 

each Fiscal Year thereafter

 

$

50,000,000

 

 

(C)                                  US EXCESS AVAILABILITY.  FAIL TO MAINTAIN
AT ANY TIME US EXCESS AVAILABILITY EQUAL TO OR IN EXCESS OF $7,500,000.

 

7.                                      EVENTS OF DEFAULT.

 

Any one or more of the following events shall constitute an event of default
(each, an “Event of Default”) under this Agreement:

 

7.1.                              IF ANY LOAN PARTY FAILS TO PAY WHEN DUE AND
PAYABLE, OR WHEN DECLARED DUE AND PAYABLE, (A) ALL OR ANY PORTION OF THE
OBLIGATIONS CONSISTING OF INTEREST, FEES, OR CHARGES

 

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DUE THE LENDER GROUP, REIMBURSEMENT OF LENDER GROUP EXPENSES, OR OTHER AMOUNTS
(OTHER THAN ANY PORTION THEREOF CONSTITUTING PRINCIPAL) CONSTITUTING OBLIGATIONS
(INCLUDING ANY PORTION THEREOF THAT ACCRUES AFTER THE COMMENCEMENT OF AN
INSOLVENCY PROCEEDING, REGARDLESS OF WHETHER ALLOWED OR ALLOWABLE IN WHOLE OR IN
PART AS A CLAIM IN ANY SUCH INSOLVENCY PROCEEDING), AND SUCH FAILURE CONTINUES
FOR A PERIOD OF 3 BUSINESS DAYS, OR (B) ALL OR ANY PORTION OF THE PRINCIPAL OF
THE OBLIGATIONS;

 

7.2.                              IF ANY LOAN PARTY

 

(A)                                  FAILS TO PERFORM OR OBSERVE ANY COVENANT OR
OTHER AGREEMENT CONTAINED IN ANY OF SECTIONS 2.7, 5.2, 5.3, 5.4, 5.7, 5.11,
5.13, 5.14, AND 6.1 THROUGH 6.17 OF THIS AGREEMENT;

 

(B)                                 FAILS TO PERFORM OR OBSERVE ANY COVENANT OR
OTHER AGREEMENT CONTAINED IN ANY OF SECTIONS 5.5, 5.6, 5.8, 5.9, 5.10 AND 5.15
OF THIS AGREEMENT AND SUCH FAILURE CONTINUES FOR A PERIOD OF 10 DAYS AFTER THE
EARLIER OF (I) THE DATE ON WHICH SUCH FAILURE SHALL FIRST BECOME KNOWN TO ANY
OFFICER OF ANY LOAN PARTY OR (II) WRITTEN NOTICE THEREOF IS GIVEN TO
ADMINISTRATIVE BORROWER BY ADMINISTRATIVE AGENT; OR

 

(C)                                  FAILS TO PERFORM OR OBSERVE ANY COVENANT OR
OTHER AGREEMENT CONTAINED IN THIS AGREEMENT, OR IN ANY OF THE OTHER LOAN
DOCUMENTS (GIVING EFFECT TO ANY GRACE PERIODS, CURE PERIODS, OR REQUIRED
NOTICES, IF ANY, PROVIDED FOR THEREIN), IN EACH CASE, OTHER THAN ANY SUCH
COVENANT OR AGREEMENT THAT IS THE SUBJECT OF ANOTHER PROVISION OF THIS SECTION 7
(IN WHICH EVENT SUCH OTHER PROVISION OF THIS SECTION 7 SHALL GOVERN), AND SUCH
FAILURE CONTINUES FOR A PERIOD OF 20 DAYS AFTER THE EARLIER OF (I) THE DATE ON
WHICH SUCH FAILURE SHALL FIRST BECOME KNOWN TO ANY OFFICER OF ANY LOAN PARTY OR
(II) WRITTEN NOTICE THEREOF IS GIVEN TO ADMINISTRATIVE BORROWER BY
ADMINISTRATIVE AGENT;

 

7.3.                              IF ANY MATERIAL PORTION OF US LOAN PARTIES’
ASSETS, TAKEN AS A WHOLE, OR FOREIGN LOAN PARTIES’ ASSETS, TAKEN AS A WHOLE, IS
ATTACHED, SEIZED, SUBJECTED TO A WRIT OR DISTRESS WARRANT, OR IS LEVIED UPON,
OR, IN CONNECTION WITH A CLAIM OF ANY THIRD PERSON, COMES INTO THE POSSESSION OF
SUCH THIRD PERSON AND THE SAME IS NOT DISCHARGED BEFORE THE EARLIER OF 30 DAYS
AFTER THE DATE IT FIRST ARISES OR 5 DAYS PRIOR TO THE DATE ON WHICH SUCH
PROPERTY OR ASSET IS SUBJECT TO FORFEITURE BY SUCH LOAN PARTY;

 

7.4.                              IF AN INSOLVENCY PROCEEDING IS COMMENCED BY
ANY LOAN PARTY OR ANY SUBSIDIARY OF A LOAN PARTY;

 

7.5.                              IF AN INSOLVENCY PROCEEDING IS COMMENCED
AGAINST ANY LOAN PARTY OR ANY SUBSIDIARY OF A LOAN PARTY (OTHER THAN IMMATERIAL
SUBSIDIARIES), AND ANY OF THE FOLLOWING EVENTS OCCUR:  (A) THE APPLICABLE LOAN
PARTY OR SUBSIDIARY CONSENTS TO THE INSTITUTION OF SUCH INSOLVENCY PROCEEDING
AGAINST IT, (B) THE PETITION COMMENCING THE INSOLVENCY PROCEEDING IS NOT TIMELY
CONTROVERTED, (C) THE PETITION COMMENCING THE INSOLVENCY PROCEEDING IS NOT
DISMISSED WITHIN 60 CALENDAR DAYS OF THE DATE OF THE FILING THEREOF; (D) AN
INTERIM TRUSTEE (OR IF APPLICABLE, A TRUSTEE, AN ADMINISTRATOR, ADMINISTRATIVE
OR OTHER RECEIVER OR SIMILAR OFFICER) IS APPOINTED TO TAKE POSSESSION OF ALL OR
ANY SUBSTANTIAL PORTION OF THE PROPERTIES OR ASSETS OF, OR

 

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TO OPERATE ALL OR ANY SUBSTANTIAL PORTION OF THE BUSINESS OF, ANY LOAN PARTY OR
ANY SUBSIDIARY OF A BORROWER, OR (E) AN ORDER FOR RELIEF SHALL HAVE BEEN ISSUED
OR ENTERED THEREIN;

 

7.6.                              IF ANY LOAN PARTY OR ANY SIGNIFICANT
SUBSIDIARY IS ENJOINED, RESTRAINED, OR IN ANY WAY PREVENTED BY COURT ORDER FROM
CONTINUING TO CONDUCT ALL OR ANY MATERIAL PART OF ITS BUSINESS AFFAIRS;

 

7.7.                              IF ONE OR MORE JUDGMENTS INVOLVING AN
AGGREGATE DOLLAR EQUIVALENT AMOUNT OF $1,500,000, OR MORE (EXCEPT TO THE EXTENT
COVERED BY INSURANCE PURSUANT TO WHICH COVERAGE IS NOT DENIED OR EXCLUDED BY THE
INSURER AND THE APPLICABLE LOAN PARTY OR SIGNIFICANT SUBSIDIARY IS IN RECEIPT OF
THE INSURANCE PROCEEDS WITHIN ONE HUNDRED EIGHTY (180) DAYS OF THE ENTRY OF SUCH
JUDGMENT) SHALL BE ENTERED AGAINST ANY LOAN PARTY OR ANY SIGNIFICANT SUBSIDIARY
OR WITH RESPECT TO A MATERIAL PORTION OF ANY OF THEIR RESPECTIVE ASSETS, AND THE
SAME IS NOT RELEASED, DISCHARGED, BONDED AGAINST, OR STAYED PENDING APPEAL
BEFORE THE EARLIER OF 30 DAYS AFTER THE DATE IT FIRST ARISES OR 5 DAYS PRIOR TO
THE DATE ON WHICH SUCH ASSET IS SUBJECT TO BEING FORFEITED BY THE APPLICABLE
LOAN PARTY OR APPLICABLE SIGNIFICANT SUBSIDIARY;

 

7.8.                              IF THERE IS A DEFAULT IN (A) THE TERM B DEBT
DOCUMENTS, OR (B) ONE OR MORE AGREEMENTS TO WHICH ANY LOAN PARTY OR ANY
SIGNIFICANT SUBSIDIARY IS A PARTY WITH ONE OR MORE THIRD PERSONS RELATIVE TO
INDEBTEDNESS OF ANY LOAN PARTY OR ANY SIGNIFICANT SUBSIDIARY (OTHER THAN
INDEBTEDNESS OF A FOREIGN SUBSIDIARY TO A US LOAN PARTY) INVOLVING AN AGGREGATE
DOLLAR EQUIVALENT AMOUNT OF $5,000,000 OR MORE, AND IN THE CASE OF CLAUSES
(A) OR (B), SUCH DEFAULT (I) OCCURS AT THE FINAL MATURITY OF THE OBLIGATIONS
THEREUNDER, OR (II) RESULTS IN A RIGHT BY SUCH THIRD PERSON(S), IRRESPECTIVE OF
WHETHER EXERCISED, TO ACCELERATE THE MATURITY OF THE APPLICABLE LOAN PARTY’S OR
ANY SIGNIFICANT SUBSIDIARY’S OBLIGATIONS THEREUNDER;

 

7.9.                              IF ANY WARRANTY, REPRESENTATION, STATEMENT, OR
RECORD MADE HEREIN OR IN ANY OTHER LOAN DOCUMENT OR DELIVERED TO LENDER IN
CONNECTION WITH THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT PROVES TO BE UNTRUE IN
ANY MATERIAL RESPECT AS OF THE DATE OF ISSUANCE OR MAKING OR DEEMED MAKING
THEREOF;

 

7.10.                        IF THE OBLIGATION OF ANY GUARANTOR UNDER ANY
GUARANTY IS LIMITED OR TERMINATED BY OPERATION OF LAW OR, EXCEPT AS EXPRESSLY
PERMITTED UNDER THE LOAN DOCUMENTS, BY SUCH GUARANTOR;

 

7.11.                        IF THE SECURITY AGREEMENT OR ANY OTHER LOAN
DOCUMENT THAT PURPORTS TO CREATE A LIEN, SHALL, FOR ANY REASON, FAIL OR CEASE TO
CREATE A VALID AND PERFECTED AND, EXCEPT TO THE EXTENT PERMITTED BY THE TERMS
HEREOF OR THEREOF, FIRST PRIORITY LIEN ON OR SECURITY INTEREST IN A MATERIAL
PORTION OF THE COLLATERAL COVERED THEREBY, EXCEPT (A) AS A RESULT OF A
DISPOSITION OF THE APPLICABLE COLLATERAL IN A TRANSACTION PERMITTED UNDER THIS
AGREEMENT OR (B) AS A RESULT OF ADMINISTRATIVE AGENT’S FAILURE TO MAINTAIN
POSSESSION OF STOCK CERTIFICATES, NOTES OR OTHER INSTRUMENTS DELIVERED TO IT; OR

 

7.12.                        ANY MATERIAL PROVISION OF ANY LOAN DOCUMENT SHALL
AT ANY TIME FOR ANY REASON BE DECLARED TO BE NULL AND VOID, OR THE VALIDITY OR
ENFORCEABILITY THEREOF SHALL BE CONTESTED BY ANY LOAN PARTY OR ANY SUBSIDIARY OF
A LOAN PARTY, OR A PROCEEDING SHALL BE

 

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COMMENCED BY ANY LOAN PARTY OR ANY SUBSIDIARY OF A LOAN PARTY, OR BY ANY
GOVERNMENTAL AUTHORITY HAVING JURISDICTION OVER ANY LOAN PARTY OR ANY SUBSIDIARY
OF A LOAN PARTY, SEEKING TO ESTABLISH THE INVALIDITY OR UNENFORCEABILITY
THEREOF, OR ANY LOAN PARTY SHALL DENY THAT IT HAS ANY LIABILITY OR OBLIGATION
PURPORTED TO BE CREATED UNDER ANY LOAN DOCUMENT.

 

8.                                      THE LENDER GROUP’S RIGHTS AND REMEDIES.

 

8.1.                            RIGHTS AND REMEDIES.

 

Upon the occurrence, and during the continuation, of an Event of Default, the
Required Lenders (at their election but without notice of their election and
without demand) may authorize and instruct the applicable Agent to do any one or
more of the following on behalf of the Lender Group (and the applicable Agent,
acting upon the instructions of the Required Lenders, shall do the same on
behalf of the Lender Group), all of which are authorized by Borrowers:

 

(A)                                  DECLARE ALL OR ANY PORTION OF THE
OBLIGATIONS, WHETHER EVIDENCED BY THIS AGREEMENT, BY ANY OF THE OTHER LOAN
DOCUMENTS, OR OTHERWISE, IMMEDIATELY DUE AND PAYABLE;

 

(B)                                 CEASE ADVANCING MONEY OR EXTENDING CREDIT TO
OR FOR THE BENEFIT OF BORROWERS UNDER THIS AGREEMENT, UNDER ANY OF THE LOAN
DOCUMENTS, OR UNDER ANY OTHER AGREEMENT BETWEEN BORROWERS AND THE LENDER GROUP;

 

(C)                                  TERMINATE THIS AGREEMENT AND ANY OF THE
OTHER LOAN DOCUMENTS AS TO ANY FUTURE LIABILITY OR OBLIGATION OF THE LENDER
GROUP, BUT WITHOUT AFFECTING ANY OF THE AGENT’S LIENS IN THE COLLATERAL AND
WITHOUT AFFECTING THE OBLIGATIONS; AND

 

(D)                                 EXERCISE ALL OTHER RIGHTS AND REMEDIES
AVAILABLE AT LAW OR IN EQUITY OR PURSUANT TO ANY OTHER LOAN DOCUMENT.

 

The foregoing to the contrary notwithstanding, upon the occurrence of any Event
of Default described in Section 7.4 or Section 7.5 as to any Borrower, in
addition to the remedies set forth above, without any notice to Borrowers or any
other Person or any act by the Lender Group, the Commitments shall automatically
terminate and the Obligations then outstanding, together with all accrued and
unpaid interest thereon and all fees and all other amounts due under this
Agreement and the other Loan Documents, shall automatically and immediately
become due and payable, without presentment, demand, protest, or notice of any
kind, all of which are expressly waived by Borrowers.  The Administrative Agent
agrees to endeavor to notify Administrative Borrower of its or the Required
Lenders’ election to terminate the Commitments or its or the Required Lenders’
election to declare all of the Obligations immediately due and payable;
provided, that failure to provide such notice shall not (i) affect the validity
of any such action taken by Administrative Agent and/or the Required Lenders,
(ii) constitute a breach by Administrative Agent or any Lender of its
obligations hereunder or under the other Loan Documents or (iii) expose
Administrative Agent or any Lender to any liability hereunder or under the other
Loan Documents.

 

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8.2.                            REMEDIES CUMULATIVE.

 

The rights and remedies of the Lender Group under this Agreement, the other Loan
Documents, and all other agreements shall be cumulative.  The Lender Group shall
have all other rights and remedies not inconsistent herewith as provided under
the Code, by law, or in equity.  No exercise by the Lender Group of one right or
remedy shall be deemed an election, and no waiver by the Lender Group of any
Event of Default shall be deemed a continuing waiver.  No delay by the Lender
Group shall constitute a waiver, election, or acquiescence by it.

 

9.                                      TAXES AND EXPENSES.

 

If any Loan Party fails to pay any monies (whether taxes, Statutory Lien
Payments, assessments, insurance premiums, or, in the case of leased properties
or assets, rents or other amounts payable under such leases) due to third
Persons, or fails to make any deposits or furnish any required proof of payment
or deposit, all as required under the terms of this Agreement, then, the
applicable Agent, in its sole discretion and without prior notice to any
Borrower, may do any or all of the following:  (a) make payment of the same or
any part thereof, (b) set up such reserves against the US Borrowing Base, the
Foreign Borrowing Base or the Maximum Revolver Amount as applicable Agent deems
necessary in its Permitted Discretion to protect the Lender Group from the
exposure created by such failure, or (c) in the case of the failure to comply
with Section 5.7 hereof, obtain and maintain insurance policies of the type
described in Section 5.7 and take any action with respect to such policies as
Administrative Agent deems prudent in its Permitted Discretion.  Any such
amounts paid by any Agent shall constitute Lender Group Expenses and any such
payments shall not constitute an agreement by the Lender Group to make similar
payments in the future or a waiver by the Lender Group of any Event of Default
under this Agreement.  Agents need not inquire as to, or contest the validity
of, any such expense, tax, or Lien and the receipt of the usual official notice
for the payment thereof shall be conclusive evidence that the same was validly
due and owing.

 

10.                               WAIVERS; INDEMNIFICATION.

 

10.1.                     DEMAND; PROTEST; ETC.

 

Each Borrower waives demand, protest, notice of protest, notice of default or
dishonor, notice of payment and nonpayment, nonpayment at maturity, release,
compromise, settlement, extension, or renewal of documents, instruments, chattel
paper, and guarantees at any time held by the Lender Group on which any such
Borrower may in any way be liable.

 

10.2.                     THE LENDER GROUP’S LIABILITY FOR BORROWER COLLATERAL.

 

Each Borrower hereby agrees that:  (a) so long as Agents comply with their
obligations, if any, under the Code, the Lender Group shall not in any way or
manner be liable or responsible for:  (i) the safekeeping of the Borrower
Collateral, (ii) any loss or damage thereto occurring or arising in any manner
or fashion from any cause, (iii) any

 

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diminution in the value thereof, or (iv) any act or default of any carrier,
warehouseman, bailee, forwarding agency, or other Person, and (b) all risk of
loss, damage, or destruction of the Borrower Collateral shall be borne by
Borrowers except with respect to Borrower Collateral in the possession of
Collateral Agent or any Lender to the extent such loss, damage or destruction
directly results from Collateral Agent’s or such Lender’s own willful misconduct
or gross negligence (as finally determined by a court of competent
jurisdiction).

 

10.3.                     INDEMNIFICATION.

 

Each Borrower shall pay, indemnify, defend, and hold the Agent-Related Persons,
the Lender-Related Persons, and each Participant (each, an “Indemnified Person”)
harmless (to the fullest extent permitted by law) from and against any and all
claims, demands, suits, actions, investigations, proceedings, and damages, and
all reasonable attorneys fees and disbursements and other costs and expenses
actually incurred in connection therewith or in connection with the enforcement
of this indemnification (as and when they are incurred and irrespective of
whether suit is brought), at any time asserted against, imposed upon, or
incurred by any of them (a) in connection with or as a result of or related to
the execution, delivery, enforcement, performance, or administration (including
any restructuring or workout with respect hereto) of this Agreement, any of the
other Loan Documents, or the transactions contemplated hereby or thereby or the
monitoring of Borrowers’ and their Subsidiaries’ compliance with the terms of
the Loan Documents, and (b) with respect to any investigation, litigation, or
proceeding related to this Agreement, any other Loan Document, or the use of the
proceeds of the credit provided hereunder (irrespective of whether any
Indemnified Person is a party thereto), or any act, omission, event, or
circumstance in any manner related thereto (all the foregoing, collectively, the
“Indemnified Liabilities”); provided, that in no event shall Foreign Borrowers
be liable with respect to Indemnified Liabilities of US Loan Parties.  The
foregoing to the contrary notwithstanding, Borrowers shall have no obligation to
any Indemnified Person under this Section 10.3 with respect to any Indemnified
Liability that a court of competent jurisdiction finally determines to have
resulted from the gross negligence or willful misconduct of such Indemnified
Person.  This provision shall survive the termination of this Agreement and the
repayment of the Obligations.  If any Indemnified Person makes any payment to
any other Indemnified Person with respect to an Indemnified Liability as to
which Borrowers were required to indemnify the Indemnified Person receiving such
payment, the Indemnified Person making such payment is entitled to be
indemnified and reimbursed by Borrowers with respect thereto.  WITHOUT
LIMITATION, THE FOREGOING INDEMNITY SHALL APPLY TO EACH INDEMNIFIED PERSON WITH
RESPECT TO INDEMNIFIED LIABILITIES WHICH IN WHOLE OR IN PART ARE CAUSED BY OR
ARISE OUT OF ANY NEGLIGENT ACT OR OMISSION OF SUCH INDEMNIFIED PERSON OR OF ANY
OTHER PERSON.

 

10.4.                     CURRENCY INDEMNITY.

 

If, for the purposes of obtaining or enforcing judgment in any court in any
jurisdiction with respect to this Agreement or any other Loan Document, it
becomes necessary to convert into the currency of such jurisdiction (the
“Judgment Currency”) any

 

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amount due under this Agreement or under any other Loan Document in any currency
other than the Judgment Currency (the “Currency Due”) (or for the purposes of
Section 2.4(a)(iii)), then, to the extent permitted by law, conversion shall be
made at the Currency Exchange Rate on the Business Day before the day on which
judgment is given (or for the purposes of Section 2.4(a)(iii), on the Business
Day on which the payment was received by the applicable Agent).  In the event
that there is a change in the Currency Exchange Rate between the Business Day
before the day on which the judgment is given and the date of receipt by the
applicable Agent of the amount due, Borrowers shall to the extent permitted by
law, on the date of receipt by such Agent, pay such additional amounts, if any,
or be entitled to receive reimbursement of such amount, if any as may be
necessary to ensure that the amount received by such Agent on such date is the
amount in the Judgment Currency which (when converted at the Currency Exchange
Rate on the date of receipt by such Agent in accordance with normal banking
procedures in the relevant jurisdiction) is the amount then due under this
Agreement or such other Loan Document in the Currency Due.  If the amount of the
Currency Due (including any Currency Due for purposes of Section 2.4) which the
applicable Agent is so able to purchase is less than the amount of the Currency
Due (including any Currency Due for purposes of Section 2.4) originally due to
it, Borrowers shall to the extent permitted by law jointly and severally
indemnify and save such Agent and Lenders harmless from and against loss or
damage arising as a result of such deficiency; provided, that in no event shall
Foreign Borrowers be liable with respect to any such deficiency arising out of
the Obligations of US Borrowers.  To the extent permitted by law, this indemnity
shall (i) constitute an obligation separate and independent from the other
obligations contained in this Agreement and the other Loan Documents, (ii) give
rise to a separate and independent cause of action, (iii) apply irrespective of
any indulgence granted by any Agent or any Lender from time to time,
(iv) survive the payment in full of the Obligations and the termination of this
Agreement, and (v) continue in full force and effect notwithstanding any
judgment or order for a liquidated sum in respect of an amount due under this
Agreement or any other Loan Document or under any judgment or order.

 

11.                               NOTICES.

 

Unless otherwise provided in this Agreement, all notices or demands by Borrowers
or any Agent to the others relating to this Agreement or any other Loan Document
shall be in writing and (except for financial statements and other informational
documents which may be sent by first-class mail, postage prepaid) shall be
personally delivered or sent by registered or certified mail (postage prepaid,
return receipt requested), overnight courier, electronic mail (at such email
addresses as Administrative Borrower or any Agent, as applicable, may designate
to each other in accordance herewith), or telefacsimile to Borrowers in care of
Administrative Borrower or to the applicable Agent, as the case may be, at its
address set forth below:

 

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If to Administrative Borrower:

 

SITEL CORPORATION

 

 

7277 World Communications Drive

 

 

Omaha, Nebraska 68122

 

 

Attn: Chief Financial Officer

 

 

Fax No.: (402) 963-2699

 

 

 

with copies to:

 

SITEL CORPORATION

 

 

7277 World Communications Drive

 

 

Omaha, Nebraska 68122

 

 

Attn: General Counsel

 

 

Fax No.: (402) 963-2699

 

 

 

If to Administrative Agent, European Administrative Agent, Collateral Agent or
Fronting Lender:

 

WELLS FARGO FOOTHILL, INC.

 

 

2450 Colorado Avenue

 

 

Suite 3000 West

 

 

Santa Monica, California 90404

 

 

Attn: Business Finance Manager

 

 

Fax No.:

 

 

 

with copies to:

 

GOLDBERG, KOHN, BELL, BLACK, ROSENBLOOM & MORITZ, LTD.

 

 

55 East Monroe Street, Suite 3700

 

 

Chicago, Illinois 60603

 

 

Attn: Keith G. Radner, Esq.

 

 

Fax No.: (312) 332-2196

 

 

 

If to Canadian Administrative Agent:

 

WELLS FARGO FINANCIAL CORPORATION CANADA
55 Standish Court, Suite 400
Mississauga, Ontario L5R 4J4
Attn: Nick Scarfo
Fax No. 905-755-7106

 

 

 

with copies to:

 

WELLS FARGO FOOTHILL, INC.
1000 Abernathy Road, Suite 1450
Atlanta, Georgia 30328
Attn: Business Finance Manager
Fax No. (770) 508-1375

 

Agents and Borrowers may change the address at which they are to receive notices
hereunder, by notice in writing in the foregoing manner given to the other
party.  All

 

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notices or demands sent in accordance with this Section 11, other than notices
by Collateral Agent in connection with enforcement rights against the Borrower
Collateral under the provisions of the Code, shall be deemed received on the
earlier of the date of actual receipt or 3 Business Days after the deposit
thereof in the mail.  Each Borrower acknowledges and agrees that notices sent by
the Lender Group in connection with the exercise of enforcement rights against
Borrower Collateral under the provisions of the Code shall, to the extent
permitted by law, be deemed sent when deposited in the mail or personally
delivered, or, where permitted by law, transmitted by telefacsimile or any other
method set forth above.

 

12.                               CHOICE OF LAW AND VENUE; JURY TRIAL WAIVER.

 

(A)                                  THE VALIDITY OF THIS AGREEMENT AND THE
OTHER LOAN DOCUMENTS (UNLESS EXPRESSLY PROVIDED TO THE CONTRARY IN ANOTHER LOAN
DOCUMENT IN RESPECT OF SUCH OTHER LOAN DOCUMENT), THE CONSTRUCTION,
INTERPRETATION, AND ENFORCEMENT HEREOF AND THEREOF, AND THE RIGHTS OF THE
PARTIES HERETO AND THERETO WITH RESPECT TO ALL MATTERS ARISING HEREUNDER OR
THEREUNDER OR RELATED HERETO OR THERETO SHALL BE DETERMINED UNDER, GOVERNED BY,
AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.

 

(B)                                  THE PARTIES AGREE THAT, TO THE FULLEST
EXTENT PERMITTED BY LAW, ALL ACTIONS OR PROCEEDINGS ARISING IN CONNECTION WITH
THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS SHALL BE TRIED AND LITIGATED ONLY IN
THE STATE AND, TO THE EXTENT PERMITTED BY APPLICABLE LAW, FEDERAL COURTS LOCATED
IN THE COUNTY OF NEW YORK, STATE OF NEW YORK, PROVIDED, HOWEVER, THAT ANY SUIT
SEEKING ENFORCEMENT AGAINST ANY COLLATERAL OR OTHER PROPERTY MAY BE BROUGHT, AT
COLLATERAL AGENT’S OPTION, TO THE FULLEST EXTENT PERMITTED BY LAW, IN THE COURTS
OF ANY JURISDICTION WHERE COLLATERAL AGENT ELECTS TO BRING SUCH ACTION OR WHERE
SUCH COLLATERAL OR OTHER PROPERTY MAY BE FOUND.  BORROWERS AND EACH MEMBER OF
THE LENDER GROUP WAIVE, TO THE EXTENT PERMITTED UNDER APPLICABLE LAW, ANY RIGHT
EACH MAY HAVE TO ASSERT THE DOCTRINE OF FORUM NON CONVENIENS OR TO OBJECT TO
VENUE TO THE EXTENT ANY PROCEEDING IS BROUGHT IN ACCORDANCE WITH THIS
SECTION 12(B).

 

(C)                                  BORROWERS AND EACH MEMBER OF THE LENDER
GROUP HEREBY WAIVE THEIR RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE
OF ACTION BASED UPON OR ARISING OUT OF ANY OF THE LOAN DOCUMENTS OR ANY OF THE
TRANSACTIONS CONTEMPLATED THEREIN, INCLUDING CONTRACT CLAIMS, TORT CLAIMS,
BREACH OF DUTY CLAIMS, AND ALL OTHER COMMON LAW OR

 

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STATUTORY CLAIMS.  BORROWERS AND EACH MEMBER OF THE LENDER GROUP REPRESENT THAT
EACH HAS REVIEWED THIS WAIVER AND EACH KNOWINGLY AND VOLUNTARILY WAIVES ITS JURY
TRIAL RIGHTS FOLLOWING CONSULTATION WITH LEGAL COUNSEL.  IN THE EVENT OF
LITIGATION, A COPY OF THIS AGREEMENT MAY BE FILED AS A WRITTEN CONSENT TO A
TRIAL BY THE COURT.

 

13.                               ASSIGNMENTS AND PARTICIPATIONS; SUCCESSORS.

 

13.1.                     ASSIGNMENTS AND PARTICIPATIONS.

 

(A)                                  ANY LENDER MAY ASSIGN AND DELEGATE TO ONE
OR MORE ASSIGNEES (EACH AN “ASSIGNEE”) THAT ARE ELIGIBLE TRANSFEREES ALL, OR ANY
RATABLE PART OF ALL, OF THE OBLIGATIONS, THE COMMITMENTS AND THE OTHER RIGHTS
AND OBLIGATIONS OF SUCH LENDER HEREUNDER AND UNDER THE OTHER LOAN DOCUMENTS, IN
A MINIMUM DOLLAR EQUIVALENT AMOUNT OF $5,000,000 (EXCEPT SUCH MINIMUM AMOUNT
SHALL NOT APPLY TO AN ASSIGNMENT OR DELEGATION BY A LENDER TO ANY OTHER LENDER);
PROVIDED, HOWEVER, THAT BORROWERS AND AGENTS MAY CONTINUE TO DEAL SOLELY AND
DIRECTLY WITH SUCH LENDER IN CONNECTION WITH THE INTEREST SO ASSIGNED TO AN
ASSIGNEE UNTIL (I) WRITTEN NOTICE OF SUCH ASSIGNMENT, TOGETHER WITH PAYMENT
INSTRUCTIONS, ADDRESSES, AND RELATED INFORMATION WITH RESPECT TO THE ASSIGNEE,
HAVE BEEN GIVEN TO ADMINISTRATIVE BORROWER AND ADMINISTRATIVE AGENT BY SUCH
LENDER AND THE ASSIGNEE, (II) SUCH LENDER AND ITS ASSIGNEE HAVE DELIVERED TO
ADMINISTRATIVE BORROWER AND ADMINISTRATIVE AGENT AN ASSIGNMENT AND ACCEPTANCE,
AND (III) THE ASSIGNING LENDER OR ASSIGNEE HAS PAID TO ADMINISTRATIVE AGENT FOR
ADMINISTRATIVE AGENT’S SEPARATE ACCOUNT A PROCESSING FEE IN THE AMOUNT OF
$3,500.  ANYTHING CONTAINED HEREIN TO THE CONTRARY NOTWITHSTANDING, THE PAYMENT
OF ANY FEES SHALL NOT BE REQUIRED AND THE ASSIGNEE NEED NOT BE AN ELIGIBLE
TRANSFEREE IF SUCH ASSIGNMENT IS IN CONNECTION WITH ANY MERGER, CONSOLIDATION,
SALE, TRANSFER, OR OTHER DISPOSITION OF ALL OR ANY SUBSTANTIAL PORTION OF THE
BUSINESS OR LOAN PORTFOLIO OF THE ASSIGNING LENDER.  NOTWITHSTANDING THE
FOREGOING, NO LENDER SHALL ASSIGN OR DELEGATE ALL, OR ANY RATABLE PART OF ALL,
OF THE OBLIGATIONS, THE COMMITMENTS AND THE OTHER RIGHTS AND OBLIGATIONS OF SUCH
LENDER HEREUNDER AND UNDER THE OTHER LOAN DOCUMENTS TO ANY DIRECT COMPETITOR OF
BORROWERS (PROVIDED, THAT A FINANCIAL INSTITUTION WHICH IS AN AFFILIATE OF A
DIRECT COMPETITOR OF BORROWERS SHALL NOT CONSTITUTE A DIRECT COMPETITOR OF
BORROWERS FOR THIS PURPOSE).

 

(B)                                 FROM AND AFTER THE DATE THAT ADMINISTRATIVE
AGENT NOTIFIES THE ASSIGNING LENDER (WITH A COPY TO ADMINISTRATIVE BORROWER)
THAT IT HAS RECEIVED AN EXECUTED ASSIGNMENT AND ACCEPTANCE AND PAYMENT OF THE
ABOVE-REFERENCED PROCESSING FEE (IF REQUIRED), (I) THE ASSIGNEE THEREUNDER SHALL
BE A PARTY HERETO AND, TO THE EXTENT THAT RIGHTS AND OBLIGATIONS HEREUNDER HAVE
BEEN ASSIGNED TO IT PURSUANT TO SUCH ASSIGNMENT AND ACCEPTANCE, SHALL HAVE THE
RIGHTS AND OBLIGATIONS OF A LENDER UNDER THE LOAN DOCUMENTS AND THE
INTERCREDITOR AGREEMENT, AND (II) THE ASSIGNING LENDER SHALL, TO THE EXTENT THAT
RIGHTS AND OBLIGATIONS HEREUNDER AND UNDER THE OTHER LOAN DOCUMENTS HAVE BEEN
ASSIGNED BY IT PURSUANT TO SUCH ASSIGNMENT AND ACCEPTANCE, RELINQUISH ITS RIGHTS
(EXCEPT WITH RESPECT TO SECTION 10.3 HEREOF) AND BE RELEASED FROM ANY FUTURE
OBLIGATIONS UNDER THIS AGREEMENT (AND IN THE CASE OF AN ASSIGNMENT AND
ACCEPTANCE COVERING ALL OR THE REMAINING PORTION OF AN ASSIGNING LENDER’S RIGHTS
AND OBLIGATIONS UNDER THIS AGREEMENT AND THE OTHER LOAN

 

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DOCUMENTS AND THE INTERCREDITOR AGREEMENT, SUCH LENDER SHALL CEASE TO BE A PARTY
HERETO AND THERETO), AND SUCH ASSIGNMENT SHALL EFFECT A NOVATION BETWEEN
BORROWERS AND THE ASSIGNEE; PROVIDED, HOWEVER, THAT NOTHING CONTAINED HEREIN
SHALL RELEASE ANY ASSIGNING LENDER FROM OBLIGATIONS THAT SURVIVE THE TERMINATION
OF THIS AGREEMENT, INCLUDING SUCH ASSIGNING LENDER’S OBLIGATIONS UNDER
ARTICLE 15 AND SECTION 16.8 OF THIS AGREEMENT.

 

(C)                                  BY EXECUTING AND DELIVERING AN ASSIGNMENT
AND ACCEPTANCE, THE ASSIGNING LENDER THEREUNDER AND THE ASSIGNEE THEREUNDER
CONFIRM TO AND AGREE WITH EACH OTHER AND THE OTHER PARTIES HERETO AS FOLLOWS: 
(1) OTHER THAN AS PROVIDED IN SUCH ASSIGNMENT AND ACCEPTANCE, SUCH ASSIGNING
LENDER MAKES NO REPRESENTATION OR WARRANTY AND ASSUMES NO RESPONSIBILITY WITH
RESPECT TO ANY STATEMENTS, WARRANTIES OR REPRESENTATIONS MADE IN OR IN
CONNECTION WITH THIS AGREEMENT OR THE EXECUTION, LEGALITY, VALIDITY,
ENFORCEABILITY, GENUINENESS, SUFFICIENCY OR VALUE OF THIS AGREEMENT OR ANY OTHER
LOAN DOCUMENT FURNISHED PURSUANT HERETO, (2) SUCH ASSIGNING LENDER MAKES NO
REPRESENTATION OR WARRANTY AND ASSUMES NO RESPONSIBILITY WITH RESPECT TO THE
FINANCIAL CONDITION OF BORROWERS OR THE PERFORMANCE OR OBSERVANCE BY BORROWERS
OF ANY OF THEIR OBLIGATIONS UNDER THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT
FURNISHED PURSUANT HERETO, (3) SUCH ASSIGNEE CONFIRMS THAT IT HAS RECEIVED A
COPY OF THIS AGREEMENT, TOGETHER WITH SUCH OTHER DOCUMENTS AND INFORMATION AS IT
HAS DEEMED APPROPRIATE TO MAKE ITS OWN CREDIT ANALYSIS AND DECISION TO ENTER
INTO SUCH ASSIGNMENT AND ACCEPTANCE, (4) SUCH ASSIGNEE WILL, INDEPENDENTLY AND
WITHOUT RELIANCE UPON ADMINISTRATIVE AGENT, SUCH ASSIGNING LENDER 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 DECISIONS IN TAKING OR NOT TAKING
ACTION UNDER THIS AGREEMENT, (5) SUCH ASSIGNEE APPOINTS AND AUTHORIZES
ADMINISTRATIVE AGENT TO TAKE SUCH ACTIONS AND TO EXERCISE SUCH POWERS UNDER THIS
AGREEMENT, THE OTHER LOAN DOCUMENTS AND THE INTERCREDITOR AGREEMENT AS ARE
DELEGATED TO ADMINISTRATIVE AGENT, BY THE TERMS HEREOF AND THEREOF, TOGETHER
WITH SUCH POWERS AS ARE REASONABLY INCIDENTAL THERETO, (6) SUCH ASSIGNEE AGREES
THAT IT WILL PERFORM ALL OF THE OBLIGATIONS WHICH BY THE TERMS OF THIS AGREEMENT
ARE REQUIRED TO BE PERFORMED BY IT AS A LENDER, AND (7) SUCH ASSIGNEE EXPRESSLY
ASSUMES ALL RIGHTS AND OBLIGATIONS OF SUCH ASSIGNING LENDER UNDER THE
INTERCREDITOR AGREEMENT AND AGREES TO BE BOUND BY THE TERMS THEREOF.

 

(D)                                 IMMEDIATELY UPON ADMINISTRATIVE AGENT’S
RECEIPT OF THE REQUIRED PROCESSING FEE PAYMENT AND THE FULLY EXECUTED ASSIGNMENT
AND ACCEPTANCE, THIS AGREEMENT SHALL BE DEEMED TO BE AMENDED TO THE EXTENT, BUT
ONLY TO THE EXTENT, NECESSARY TO REFLECT THE ADDITION OF THE ASSIGNEE AND THE
RESULTING ADJUSTMENT OF THE COMMITMENTS ARISING THEREFROM.  THE COMMITMENTS
ALLOCATED TO EACH ASSIGNEE SHALL REDUCE SUCH COMMITMENTS OF THE ASSIGNING LENDER
PRO TANTO.

 

(E)                                  ANY LENDER MAY AT ANY TIME SELL TO ONE OR
MORE COMMERCIAL BANKS, FINANCIAL INSTITUTIONS, OR OTHER PERSONS (A
“PARTICIPANT”) PARTICIPATING INTERESTS IN ALL OR ANY PORTION OF ITS OBLIGATIONS,
THE COMMITMENTS, AND THE OTHER RIGHTS AND INTERESTS OF THAT LENDER (THE
“ORIGINATING LENDER”) HEREUNDER AND UNDER THE OTHER LOAN DOCUMENTS; PROVIDED,
HOWEVER, THAT (I) THE ORIGINATING LENDER SHALL REMAIN A “LENDER” FOR ALL
PURPOSES OF THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS AND THE PARTICIPANT
RECEIVING THE PARTICIPATING INTEREST IN THE OBLIGATIONS, THE COMMITMENTS, AND
THE OTHER RIGHTS AND INTERESTS OF THE ORIGINATING LENDER HEREUNDER SHALL NOT
CONSTITUTE A “LENDER” HEREUNDER OR UNDER THE OTHER

 

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LOAN DOCUMENTS AND THE ORIGINATING LENDER’S OBLIGATIONS UNDER THIS AGREEMENT
SHALL REMAIN UNCHANGED, (II) THE ORIGINATING LENDER SHALL REMAIN SOLELY
RESPONSIBLE FOR THE PERFORMANCE OF SUCH OBLIGATIONS, (III) BORROWERS, AGENTS,
AND THE LENDERS SHALL CONTINUE TO DEAL SOLELY AND DIRECTLY WITH THE ORIGINATING
LENDER IN CONNECTION WITH THE ORIGINATING LENDER’S RIGHTS AND OBLIGATIONS UNDER
THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS, (IV) NO LENDER SHALL TRANSFER OR
GRANT ANY PARTICIPATING INTEREST UNDER WHICH THE PARTICIPANT HAS THE RIGHT TO
APPROVE ANY AMENDMENT TO, OR ANY CONSENT OR WAIVER WITH RESPECT TO, THIS
AGREEMENT OR ANY OTHER LOAN DOCUMENT, EXCEPT TO THE EXTENT SUCH AMENDMENT TO, OR
CONSENT OR WAIVER WITH RESPECT TO THIS AGREEMENT OR OF ANY OTHER LOAN DOCUMENT
WOULD (A) EXTEND THE FINAL MATURITY DATE OF THE OBLIGATIONS HEREUNDER IN WHICH
SUCH PARTICIPANT IS PARTICIPATING, (B) REDUCE THE INTEREST RATE APPLICABLE TO
THE OBLIGATIONS HEREUNDER IN WHICH SUCH PARTICIPANT IS PARTICIPATING,
(C) RELEASE ALL OR SUBSTANTIALLY ALL OF THE COLLATERAL OR GUARANTIES (EXCEPT TO
THE EXTENT EXPRESSLY PROVIDED HEREIN OR IN ANY OF THE LOAN DOCUMENTS) SUPPORTING
THE OBLIGATIONS HEREUNDER IN WHICH SUCH PARTICIPANT IS PARTICIPATING,
(D) POSTPONE THE PAYMENT OF, OR REDUCE THE AMOUNT OF, THE INTEREST OR FEES
PAYABLE TO SUCH PARTICIPANT THROUGH SUCH LENDER, OR (E) CHANGE THE AMOUNT OR DUE
DATES OF SCHEDULED PRINCIPAL REPAYMENTS OR PREPAYMENTS OR PREMIUMS, AND (V) ALL
AMOUNTS PAYABLE BY BORROWERS HEREUNDER SHALL BE DETERMINED AS IF SUCH LENDER HAD
NOT SOLD SUCH PARTICIPATION, EXCEPT THAT, IF AMOUNTS OUTSTANDING UNDER THIS
AGREEMENT ARE DUE AND UNPAID, OR SHALL HAVE BEEN DECLARED OR SHALL HAVE BECOME
DUE AND PAYABLE UPON THE OCCURRENCE OF AN EVENT OF DEFAULT, EACH PARTICIPANT
SHALL BE DEEMED, TO THE EXTENT PERMITTED BY LAW, TO HAVE THE RIGHT OF SET OFF IN
RESPECT OF ITS PARTICIPATING INTEREST IN AMOUNTS OWING UNDER THIS AGREEMENT TO
THE SAME EXTENT AS IF THE AMOUNT OF ITS PARTICIPATING INTEREST WERE OWING
DIRECTLY TO IT AS A LENDER UNDER THIS AGREEMENT.  THE RIGHTS OF ANY PARTICIPANT
ONLY SHALL BE DERIVATIVE THROUGH THE ORIGINATING LENDER WITH WHOM SUCH
PARTICIPANT PARTICIPATES AND NO PARTICIPANT SHALL HAVE ANY RIGHTS UNDER THIS
AGREEMENT OR THE OTHER LOAN DOCUMENTS OR ANY DIRECT RIGHTS AS TO THE OTHER
LENDERS, AGENTS, BORROWERS, THE COLLECTIONS OF LOAN PARTIES, THE COLLATERAL, OR
OTHERWISE IN RESPECT OF THE OBLIGATIONS.  NO PARTICIPANT SHALL HAVE THE RIGHT TO
PARTICIPATE DIRECTLY IN THE MAKING OF DECISIONS BY THE LENDERS AMONG THEMSELVES.

 

(F)                                    IN CONNECTION WITH ANY SUCH ASSIGNMENT OR
PARTICIPATION OR PROPOSED ASSIGNMENT OR PARTICIPATION, A LENDER MAY, SUBJECT TO
THE PROVISIONS OF SECTION 16.8, DISCLOSE TO SUCH PROPOSED ASSIGNEE OR
PARTICIPANT AND ITS REPRESENTATIVES ALL DOCUMENTS AND INFORMATION WHICH IT NOW
OR HEREAFTER MAY HAVE RELATING TO BORROWERS AND THEIR SUBSIDIARIES AND THEIR
RESPECTIVE BUSINESSES.

 

(G)                                 ANY OTHER PROVISION IN THIS AGREEMENT
NOTWITHSTANDING, ANY LENDER MAY AT ANY TIME CREATE A SECURITY INTEREST IN, OR
PLEDGE, ALL OR ANY PORTION OF ITS RIGHTS UNDER AND INTEREST IN THIS AGREEMENT IN
FAVOR OF ANY FEDERAL RESERVE BANK IN ACCORDANCE WITH REGULATION A OF THE FEDERAL
RESERVE BANK OR U.S. TREASURY REGULATION 31 CFR § 203.24, AND SUCH FEDERAL
RESERVE BANK MAY ENFORCE SUCH PLEDGE OR SECURITY INTEREST IN ANY MANNER
PERMITTED UNDER APPLICABLE LAW.

 

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13.2.                     SUCCESSORS.

 

This Agreement shall bind and inure to the benefit of the respective successors
and assigns of each of the parties; provided, however, that Borrowers may not
assign this Agreement or any rights or duties hereunder without the Lenders’
prior written consent and any prohibited assignment shall be absolutely void ab
initio.  No consent to assignment by the Lenders shall release any Borrower from
its Obligations.  A Lender may assign this Agreement and the other Loan
Documents and its rights and duties hereunder and thereunder pursuant to
Section 13.1 hereof and, except as expressly required pursuant to Section 13.1
hereof, no consent or approval by any Borrower is required in connection with
any such assignment.

 

14.                               AMENDMENTS; WAIVERS.

 

14.1.                     AMENDMENTS AND WAIVERS.

 

No amendment or waiver of any provision of this Agreement or any other Loan
Document (other than Bank Product Agreements and Letters of Credit), and no
consent with respect to any departure by Borrowers therefrom, shall be effective
unless the same shall be in writing and signed by the Required Lenders (or by
the applicable Agent at the written request of the Required Lenders) and
Administrative Borrower (on behalf of all Borrowers) and then any such waiver or
consent shall be effective, but only in the specific instance and for the
specific purpose for which given; provided, however, that no such waiver,
amendment, or consent shall, unless in writing and signed by all of the Lenders
affected thereby and Administrative Borrower (on behalf of all Borrowers), do
any of the following:

 

(A)                                  INCREASE OR EXTEND ANY COMMITMENT OF ANY
LENDER,

 

(B)                                 POSTPONE OR DELAY ANY DATE FIXED BY THIS
AGREEMENT OR ANY OTHER LOAN DOCUMENT FOR ANY PAYMENT OF PRINCIPAL, INTEREST,
FEES, OR OTHER AMOUNTS DUE HEREUNDER OR UNDER ANY OTHER LOAN DOCUMENT,

 

(C)                                  REDUCE THE PRINCIPAL OF, OR THE RATE OF
INTEREST ON, ANY LOAN OR OTHER EXTENSION OF CREDIT HEREUNDER, OR REDUCE ANY FEES
OR OTHER AMOUNTS PAYABLE HEREUNDER OR UNDER ANY OTHER LOAN DOCUMENT,

 

(D)                                 CHANGE THE PRO RATA SHARE THAT IS REQUIRED
TO TAKE ANY ACTION HEREUNDER,

 

(E)                                  AMEND OR MODIFY THIS SECTION OR ANY
PROVISION OF THIS AGREEMENT PROVIDING FOR CONSENT OR OTHER ACTION BY ALL
LENDERS,

 

(F)                                    OTHER THAN AS PERMITTED BY SECTION 15.12,
RELEASE AGENT’S LIEN IN AND TO ANY OF THE COLLATERAL,

 

(G)                                 CHANGE THE DEFINITION OF “REQUIRED LENDERS”
OR “PRO RATA SHARE”,

 

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(H)                                 CONTRACTUALLY SUBORDINATE ANY OF THE AGENT’S
LIENS OTHER THAN TO A LIEN PERMITTED PURSUANT TO CLAUSE (F) OF THE DEFINITION OF
“PERMITTED LIEN”,

 

(I)                                     EXCEPT AS EXPRESSLY PERMITTED BY THE
LOAN DOCUMENTS, RELEASE ANY BORROWER OR ANY GUARANTOR FROM ANY OBLIGATION FOR
THE PAYMENT OF MONEY,

 

(J)                                     CHANGE THE DEFINITION OF “US BORROWING
BASE” OR “FOREIGN BORROWING BASE” OR “CANADIAN BORROWING BASE” OR “EUROPEAN
BORROWING BASE” OR THE DEFINITIONS OF “ELIGIBLE FOREIGN ACCOUNTS”, “ELIGIBLE
TRANSFEREE”, “ELIGIBLE US ACCOUNTS”, “ELIGIBLE UNBILLED US ACCOUNTS”, “ELIGIBLE
UNBILLED FOREIGN ACCOUNTS”, “MAXIMUM REVOLVER AMOUNT”, “MAXIMUM CANADIAN
REVOLVER AMOUNT”, “MAXIMUM EUROPEAN REVOLVER AMOUNT”, “MAXIMUM US REVOLVER
AMOUNT”, “TERM LOAN A AMOUNT”, OR CHANGE, MODIFY OR WAIVE SECTION 2.1(B), OR
SECTION 2.4(B), OR

 

(K)                                  AMEND ANY OF THE PROVISIONS OF SECTION 15.

 

and, provided further, however, that no amendment, waiver or consent shall,
unless in writing and signed by Administrative Agent, Canadian Administrative
Agent, European Administrative Agent, US Issuing Lender, Fronting Lender,
Canadian Issuing Lender, European Issuing Lender, US Swing Lender or Canadian
Swing Lender, as applicable, affect the rights or duties of Administrative
Agent, Canadian Administrative Agent, European Administrative Agent, US Issuing
Lender, Fronting Lender, Canadian Issuing Lender, European Issuing Lender, US
Swing Lender, European Swing Lender or Canadian Swing Lender, as applicable,
under this Agreement or any other Loan Document.  The foregoing notwithstanding,
any amendment, modification, waiver, consent, termination, or release of, or
with respect to, any provision of this Agreement or any other Loan Document that
relates only to the relationship of the Lender Group among themselves, and that
does not affect the rights or obligations of Borrowers, shall not require
consent by or the agreement of Borrowers.

 

14.2.                     REPLACEMENT OF HOLDOUT LENDER.

 

(A)                                  IF ANY ACTION TO BE TAKEN BY THE LENDER
GROUP OR ANY AGENT HEREUNDER REQUIRES THE UNANIMOUS CONSENT, AUTHORIZATION, OR
AGREEMENT OF ALL LENDERS, AND A LENDER (“HOLDOUT LENDER”) FAILS TO GIVE ITS
CONSENT, AUTHORIZATION, OR AGREEMENT, THEN ADMINISTRATIVE AGENT, UPON AT LEAST 5
BUSINESS DAYS PRIOR IRREVOCABLE NOTICE TO THE HOLDOUT LENDER, MAY PERMANENTLY
REPLACE THE HOLDOUT LENDER WITH ONE OR MORE SUBSTITUTE LENDERS (EACH, A
“REPLACEMENT LENDER”), AND THE HOLDOUT LENDER SHALL HAVE NO RIGHT TO REFUSE TO
BE REPLACED HEREUNDER.  SUCH NOTICE TO REPLACE THE HOLDOUT LENDER SHALL SPECIFY
AN EFFECTIVE DATE FOR SUCH REPLACEMENT, WHICH DATE SHALL NOT BE LATER THAN 15
BUSINESS DAYS AFTER THE DATE SUCH NOTICE IS GIVEN.

 

(B)                                 PRIOR TO THE EFFECTIVE DATE OF SUCH
REPLACEMENT, THE HOLDOUT LENDER AND EACH REPLACEMENT LENDER SHALL EXECUTE AND
DELIVER AN ASSIGNMENT AND ACCEPTANCE, SUBJECT ONLY TO THE HOLDOUT LENDER BEING
REPAID ITS SHARE OF THE OUTSTANDING OBLIGATIONS (INCLUDING AN ASSUMPTION OF ITS
PRO RATA SHARE OF THE RISK PARTICIPATION LIABILITY) WITHOUT ANY PREMIUM

 

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OR PENALTY OF ANY KIND WHATSOEVER.  IF THE HOLDOUT LENDER SHALL REFUSE OR FAIL
TO EXECUTE AND DELIVER ANY SUCH ASSIGNMENT AND ACCEPTANCE PRIOR TO THE EFFECTIVE
DATE OF SUCH REPLACEMENT, THE HOLDOUT LENDER SHALL BE DEEMED TO HAVE EXECUTED
AND DELIVERED SUCH ASSIGNMENT AND ACCEPTANCE.  THE REPLACEMENT OF ANY HOLDOUT
LENDER SHALL BE MADE IN ACCORDANCE WITH THE TERMS OF SECTION 13.1.  UNTIL SUCH
TIME AS THE REPLACEMENT LENDERS SHALL HAVE ACQUIRED ALL OF THE OBLIGATIONS, THE
COMMITMENTS, AND THE OTHER RIGHTS AND OBLIGATIONS OF THE HOLDOUT LENDER
HEREUNDER AND UNDER THE OTHER LOAN DOCUMENTS, THE HOLDOUT LENDER SHALL REMAIN
OBLIGATED TO MAKE THE HOLDOUT LENDER’S PRO RATA SHARE OF ADVANCES AND TO
PURCHASE A PARTICIPATION IN EACH LETTER OF CREDIT, IN AN AMOUNT EQUAL TO ITS PRO
RATA SHARE OF THE RISK PARTICIPATION LIABILITY OF SUCH LETTER OF CREDIT.

 

14.3.                     NO WAIVERS; CUMULATIVE REMEDIES.

 

No failure by any Agent or any Lender to exercise any right, remedy, or option
under this Agreement or any other Loan Document, or delay by any Agent or any
Lender in exercising the same, will operate as a waiver thereof.  No waiver by
any Agent or any Lender will be effective unless it is in writing, and then only
to the extent specifically stated.  No waiver by any Agent or any Lender on any
occasion shall affect or diminish each Agent’s and each Lender’s rights
thereafter to require strict performance by Borrowers of any provision of this
Agreement.  Each Agent’s and each Lender’s rights under this Agreement and the
other Loan Documents will be cumulative and not exclusive of any other right or
remedy that any Agent or any Lender may have.

 

15.                               AGENT; THE LENDER GROUP.

 

15.1.                     APPOINTMENT AND AUTHORIZATION OF AGENTS.

 

Each Lender hereby designates and appoints (i) WFF as its representative as
Administrative Agent, European Administrative Agent and Collateral Agent (in
respect of, inter alia, taking the Guarantees and a security interest in the
Collateral for and on behalf of the Lender Group) and (ii) WF Canada as its
representative as Canadian Administrative Agent under this Agreement and the
other Loan Documents and, subject to Section 14.1, each Lender hereby
irrevocably authorizes each Agent to execute and deliver each of the other Loan
Documents on its behalf and to take such other action on its behalf under the
provisions of this Agreement and each other Loan Document and to exercise such
powers and perform such duties as are expressly delegated to such Agent by the
terms of this Agreement or any other Loan Document, together with such powers as
are reasonably incidental thereto.  Each Agent agrees to act as such on the
express conditions contained in this Section 15.  The provisions of this
Section 15 (other than Section 15.9, Section 15.11, the first and last sentences
of Section 15.12(a), and Section 15.12(b)) are solely for the benefit of Agents,
and the Lenders, and Borrowers and their Subsidiaries shall have no rights as a
third party beneficiary of any of the provisions contained herein.  Any
provision to the contrary contained elsewhere in this Agreement or in any other
Loan Document notwithstanding, no Agent shall have any duties or
responsibilities, except those expressly set forth herein, nor shall any Agent
have or be deemed to have any fiduciary relationship with any Lender, and no
implied covenants, functions, responsibilities, duties, obligations or

 

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liabilities shall be read into this Agreement or any other Loan Document or
otherwise exist against any Agent; it being expressly understood and agreed that
the use of the word “Agent” is for convenience only, that WFF and WF Canada are
merely the representatives of the Lenders, and only have the contractual duties
set forth herein.  Except as expressly otherwise provided in this Agreement,
Agents shall have and may use their sole discretion with respect to exercising
or refraining from exercising any discretionary rights or taking or refraining
from taking any actions that each Agent expressly is entitled to take or assert
under or pursuant to this Agreement and the other Loan Documents.  Without
limiting the generality of the foregoing, or of any other provision of the Loan
Documents that provides rights or powers to Agents, Lenders agree that each
Agent shall have the right to exercise the following powers as long as this
Agreement remains in effect:  (a) maintain, in accordance with its customary
business practices, ledgers and records reflecting the status of the
Obligations, the Collateral, the Collections of Loan Parties, and related
matters, (b) execute or file any and all financing or similar statements or
notices, amendments, renewals, supplements, documents, instruments, proofs of
claim, notices and other written agreements with respect to the Loan Documents,
(c) make Advances, for itself or on behalf of Lenders as provided in the Loan
Documents, (d) exclusively receive, apply, and distribute the Collections of
Loan Parties as provided in the Loan Documents, (e) open and maintain such bank
accounts and cash management arrangements as such Agent deems necessary and
appropriate in accordance with the Loan Documents for the foregoing purposes
with respect to the Collateral and the Collections of Loan Parties, (f) perform,
exercise, and enforce any and all other rights and remedies of the Lender Group
with respect to Borrowers, the Obligations, the Collateral, the Collections of
Loan Parties, or otherwise related to any of same as provided in the Loan
Documents, and (g) incur and pay such Lender Group Expenses as such Agent may
deem necessary or appropriate for the performance and fulfillment of its
functions and powers pursuant to the Loan Documents.

 

15.2.                     DELEGATION OF DUTIES.

 

Agents may execute any of their duties under this Agreement or any other Loan
Document by or through agents, employees 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 agent or
attorney in fact that it selects as long as such selection was made without
gross negligence or willful misconduct.

 

15.3.                     LIABILITY OF AGENTS.

 

None of the Agent Related Persons shall (a) be liable for any action taken or
omitted to be taken by any of them under or in connection with this Agreement or
any other Loan Document or the transactions contemplated hereby (except for its
own gross negligence or willful misconduct), or (b) be responsible in any manner
to any of the Lenders for any recital, statement, representation or warranty
made by any Borrower or any Subsidiary or Affiliate of any Borrower, or any
officer or director thereof, contained in this Agreement or in any other Loan
Document, or in any certificate, report, statement or other document referred to
or provided for in, or received by any Agent under or in connection with, this
Agreement or any other Loan Document, or the validity, effectiveness,
genuineness,

 

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enforceability or sufficiency of this Agreement or any other Loan Document, or
for any failure of any Borrower or any other party to any Loan Document to
perform its obligations hereunder or thereunder.  No Agent Related Person shall
be under any obligation to any Lender to ascertain or to inquire as to the
observance or performance of any of the agreements contained in, or conditions
of, this Agreement or any other Loan Document, or to inspect the books and
records or properties of Borrowers or the books or records or properties of any
of Borrowers’ Subsidiaries or Affiliates.

 

15.4.                     RELIANCE BY AGENTS.

 

Each Agent shall be entitled to rely, and shall be fully protected in relying,
upon any writing, resolution, notice, consent, certificate, affidavit, letter,
telegram, telefacsimile or other electronic method of transmission, telex or
telephone message, statement or other document or conversation believed by it to
be genuine and correct and to have been signed, sent, or made by the proper
Person or Persons, and upon advice and statements of legal counsel (including
counsel to Borrowers or counsel to any Lender), independent accountants and
other experts selected by any Agent.  Each Agent shall be fully justified in
failing or refusing to take any action under this Agreement or any other Loan
Document unless such Agent shall first receive such advice or concurrence of the
Lenders as it deems appropriate and until such instructions are received, such
Agent shall act, or refrain from acting, as it deems advisable.  If any Agent so
requests, it shall first be indemnified to its reasonable 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.  Each Agent shall in all
cases be fully protected in acting, or in refraining from acting, under this
Agreement or any other Loan Document in accordance with a request or consent of
the requisite Lenders and such request and any action taken or failure to act
pursuant thereto shall be binding upon all of the Lenders.

 

15.5.                     NOTICE OF DEFAULT OR EVENT OF DEFAULT.

 

No Agent shall be deemed to have knowledge or notice of the occurrence of any
Default or Event of Default, except with respect to defaults in the payment of
principal, interest, fees, and expenses required to be paid to any Agent for the
account of the Lenders and, except with respect to Events of Default of which
such Agent has actual knowledge, unless such Agent shall have received written
notice from a Lender or Administrative Borrower referring to this Agreement,
describing such Default or Event of Default, and stating that such notice is a
“notice of default”.  Each Agent promptly will notify the Lenders of its receipt
of any such notice or of any Event of Default of which such Agent has actual
knowledge.  If any Lender obtains actual knowledge of any Event of Default, such
Lender promptly shall notify the other Lenders and Agents of such Event of
Default.  Each Lender shall be solely responsible for giving any notices to its
Participants, if any.  Subject to Section 15.4, the applicable Agent shall take
such action with respect to such Default or Event of Default as may be requested
by the Required Lenders in accordance with Section 8; provided, however, that,
after the occurrence of a Default or an Event of Default, if an event occurs or
a circumstance exists that materially and imminently threatens the ability of
the Lender Group to realize upon any material part of the Collateral (such as
fraudulent removal,

 

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concealment, or abscondment thereof, destruction (other than to the extent
covered by insurance) or material waste thereof, or failure of Borrowers after
reasonable demand to maintain or reinstate adequate casualty insurance coverage
with respect thereto), such Agent may take such action, or refrain from taking
such action, with respect to such Default or Event of Default as it shall deem
advisable.

 

15.6.                     CREDIT DECISION.

 

Each Lender acknowledges that none of the Agent Related Persons has made any
representation or warranty to it, and that no act by any Agent hereinafter
taken, including any review of the affairs of Borrowers and their Subsidiaries
or Affiliates, shall be deemed to constitute any representation or warranty by
any Agent-Related Person to any Lender.  Each Lender represents to Agents that
it has, independently and without reliance upon any Agent-Related Person and
based on such documents and information as it has deemed appropriate, made its
own appraisal of and investigation into the business, prospects, operations,
property, financial and other condition and creditworthiness of Borrowers and
any other Person party to a Loan Document, and all applicable bank regulatory
laws relating to the transactions contemplated hereby, and made its own decision
to enter into this Agreement and to extend credit to Borrowers.  Each Lender
also represents that it will, independently and without reliance upon any
Agent-Related Person 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 investigations as it deems necessary
to inform itself as to the business, prospects, operations, property, financial
and other condition and creditworthiness of Borrowers and any other Person party
to a Loan Document.  Except for notices, reports, and other documents expressly
herein required to be furnished to the Lenders by any Agent, no Agent shall have
any duty or responsibility to provide any Lender with any credit or other
information concerning the business, prospects, operations, property, financial
and other condition or creditworthiness of Borrowers and any other Person party
to a Loan Document that may come into the possession of any of the Agent Related
Persons.

 

15.7.                     COSTS AND EXPENSES; INDEMNIFICATION.

 

Agents may incur and pay Lender Group Expenses to the extent such Agent
reasonably deems necessary or appropriate for the performance and fulfillment of
its functions, powers, and obligations pursuant to the Loan Documents, including
court costs, attorneys fees and expenses, fees and expenses of financial
accountants, advisors, consultants, and appraisers, costs of collection by
outside collection agencies, auctioneer fees and expenses, and costs of security
guards or insurance premiums paid to maintain the Collateral, whether or not
Borrowers are obligated to reimburse Agents or Lenders for such expenses
pursuant to this Agreement or otherwise.  Each Agent is authorized and directed
to deduct and retain sufficient amounts from the Collections of Loan Parties
received by such Agent to reimburse such Agent for such out-of-pocket costs and
expenses prior to the distribution of any amounts to Lenders.  In the event any
Agent is not reimbursed for such costs and expenses from the Collections of Loan
Parties received by such Agent, each Lender hereby agrees that it is and shall
be obligated to pay to or reimburse such Agent for

 

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the amount of such Lender’s Pro Rata Share thereof.  Whether or not the
transactions contemplated hereby are consummated, the Lenders shall indemnify
upon demand the Agent Related Persons (to the extent not reimbursed by or on
behalf of Borrowers and without limiting the obligation of Borrowers to do so),
according to their Pro Rata Shares, from and against any and all Indemnified
Liabilities; provided, however, that no Lender shall be liable for the payment
to any Agent Related Person of any portion of such Indemnified Liabilities
resulting solely from such Person’s gross negligence or willful misconduct nor
shall any Lender be liable for the obligations of any Defaulting Lender in
failing to make an Advance or other extension of credit hereunder.  Without
limitation of the foregoing, each Lender shall reimburse each Agent upon demand
for such Lender’s Pro Rata Share of any costs or out of pocket expenses
(including attorneys, accountants, advisors, and consultants fees and expenses)
incurred by such Agent in connection with the preparation, execution, delivery,
administration, modification, amendment, or enforcement (whether through
negotiations, legal proceedings or otherwise) of, or legal advice in respect of
rights or responsibilities under, this Agreement, any other Loan Document, or
any document contemplated by or referred to herein, to the extent that such
Agent is not reimbursed for such expenses by or on behalf of Borrowers.  The
undertaking in this Section shall survive the payment of all Obligations
hereunder and the resignation or replacement of the applicable Agent.

 

15.8.                     AGENTS IN INDIVIDUAL CAPACITY.

 

WFF and WF Canada and their respective Affiliates may make loans to, issue
letters of credit for the account of, accept deposits from, acquire equity
interests in, and generally engage in any kind of banking, trust, financial
advisory, underwriting, or other business with Borrowers and their Subsidiaries
and Affiliates and any other Person party to any Loan Documents as though WFF
and WF Canada were not Agents hereunder, and, in each case, without notice to or
consent of the other members of the Lender Group.  The other members of the
Lender Group acknowledge that, pursuant to such activities, WFF or WF Canada or
their respective Affiliates may receive information regarding Borrowers or their
Affiliates and any other Person party to any Loan Documents that is subject to
confidentiality obligations in favor of Borrowers or such other Person and that
prohibit the disclosure of such information to the Lenders, and the Lenders
acknowledge that, in such circumstances (and in the absence of a waiver of such
confidentiality obligations, which waiver Administrative Agent will use its
reasonable best efforts to obtain), Administrative Agent shall not be under any
obligation to provide such information to them.  The terms “Lender” and
“Lenders” include WFF and WF Canada in their in its individual capacity.

 

15.9.                     SUCCESSOR AGENT.

 

Any Agent may resign as an Agent upon 45 days notice to the Lenders and the
Administrative Borrower.  If any Agent resigns under this Agreement, the
Required Lenders shall, so long as no Event of Default has occurred and is
continuing in consultation with Administrative Borrower, appoint a successor
Agent for the Lenders.  If no successor Agent is appointed prior to the
effective date of the resignation of the resigning Agent, Administrative Agent
may appoint, after consulting with the Lenders and, if no Event of Default has
occurred and is continuing, Administrative Borrower, a successor Agent.  If any

 

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Agent has materially breached or failed to perform any material provision of
this Agreement or of Applicable Law, the Required Lenders so long as no Event of
Default has occurred and is continuing in consultation with Administrative
Borrower, may agree in writing to remove and replace such Agent with a successor
Agent from among the Lenders.  In any such event, upon the acceptance of its
appointment as successor Agent hereunder, such successor Agent shall succeed to
all the rights, powers, and duties of the retiring Agent and the term “Agent”
shall mean such successor Agent and the retiring Agent’s appointment, powers,
and duties as an Agent shall be terminated.  After any retiring Agent’s
resignation hereunder as an Agent, the provisions of this Section 15 shall inure
to its benefit as to any actions taken or omitted to be taken by it while it was
an Agent under this Agreement.  If no successor Agent has accepted appointment
as an Agent by the date which is 45 days following a retiring Agent’s notice of
resignation, the retiring Agent’s resignation shall nevertheless thereupon
become effective and the Lenders shall perform all of the duties of Agent
hereunder until such time, if any, as the Lenders appoint a successor Agent as
provided for above.

 

15.10.              LENDER IN INDIVIDUAL CAPACITY.

 

Any Lender and its respective Affiliates may make loans to, issue letters of
credit for the account of, accept deposits from, acquire equity interests in and
generally engage in any kind of banking, trust, financial advisory, underwriting
or other business with Borrowers and their Subsidiaries and Affiliates and any
other Person party to any Loan Documents as though such Lender were not a Lender
hereunder without notice to or consent of the other members of the Lender
Group.  The other members of the Lender Group acknowledge that, pursuant to such
activities, such Lender and its respective Affiliates may receive information
regarding Borrowers or their Affiliates and any other Person party to any Loan
Documents that is subject to confidentiality obligations in favor of Borrowers
or such other Person and that prohibit the disclosure of such information to the
Lenders, and the Lenders acknowledge that, in such circumstances (and in the
absence of a waiver of such confidentiality obligations, which waiver such
Lender will use its reasonable best efforts to obtain), such Lender shall not be
under any obligation to provide such information to them.  With respect to the
Swing Loans, Swing Lenders shall have the same rights and powers under this
Agreement as any other Lender and may exercise the same as though it were not
the sub-agent of the applicable Agent.

 

15.11.              WITHHOLDING TAXES.

 

(A)                                  ALL PAYMENTS MADE BY ANY BORROWER HEREUNDER
OR UNDER ANY NOTE OR OTHER LOAN DOCUMENT WILL BE MADE FREE AND CLEAR OF, AND
WITHOUT DEDUCTION OR WITHHOLDING FOR, ANY PRESENT OR FUTURE TAXES UNLESS SUCH
DEDUCTION OR WITHHOLDING IS REQUIRED BY APPLICABLE LAW.  IF DEDUCTION OR
WITHHOLDING FOR TAXES SHALL AT ANY TIME BE REQUIRED BY LAW, EACH APPLICABLE
BORROWER AGREES TO PAY THE FULL AMOUNT OF SUCH TAXES TO THE APPROPRIATE TAXING
AUTHORITY AND TO PAY TO EACH LENDER ENTITLED TO RECEIVE PAYMENTS FROM WHICH SUCH
TAXES ARE DEDUCTED OR WITHHELD SUCH ADDITIONAL AMOUNTS AS MAY BE NECESSARY SO
THAT EVERY PAYMENT OF ALL AMOUNTS DUE UNDER THIS AGREEMENT, ANY NOTE, OR LOAN
DOCUMENT, INCLUDING ANY AMOUNT PAID PURSUANT TO THIS SECTION 15.11(A) AFTER
WITHHOLDING OR DEDUCTION FOR OR ON ACCOUNT OF SUCH TAXES, WILL NOT BE LESS THAN
THE PAYMENT THAT WOULD HAVE BEEN RECEIVED IN

 

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THE ABSENCE OF SUCH TAXES; PROVIDED, HOWEVER, THAT BORROWERS SHALL NOT BE
REQUIRED TO PAY ANY SUCH ADDITIONAL AMOUNTS TO ANY AGENT OR ANY LENDER (I) IF
SUCH AGENT OR LENDER FAILS TO COMPLY WITH THE OTHER REQUIREMENTS OF THIS
SECTION 15.11, (II) IF THE OBLIGATION TO PAY SUCH AMOUNTS RESULTS FROM SUCH
AGENT’S OR SUCH LENDER’S OWN BAD FAITH, WILLFUL MISCONDUCT, OR GROSS NEGLIGENCE,
OR (III) ON ACCOUNT OF ANY EXCLUDED TAXES AND PROVIDED FURTHER THAT US BORROWERS
SHALL NOT BE REQUIRED TO PAY ANY US WITHHOLDING TAX THAT IS IMPOSED ON AMOUNTS
PAYABLE TO A LENDER THAT IS ATTRIBUTABLE TO SUCH LENDER’S FAILURE TO COMPLY WITH
SECTION 15.11.  EACH BORROWER WILL FURNISH TO ADMINISTRATIVE AGENT AS PROMPTLY
AS POSSIBLE AFTER THE DATE THE PAYMENT OF ANY TAX IS DUE PURSUANT TO APPLICABLE
LAW CERTIFIED COPIES OF TAX RECEIPTS EVIDENCING SUCH PAYMENT BY ANY BORROWER. 
“TAXES” SHALL MEAN, ANY TAXES, LEVIES, IMPOSTS, DUTIES, FEES, ASSESSMENTS OR
OTHER CHARGES OF WHATEVER NATURE NOW OR HEREAFTER IMPOSED BY ANY JURISDICTION OR
BY ANY POLITICAL SUBDIVISION OR TAXING AUTHORITY THEREOF OR THEREIN WITH RESPECT
TO PAYMENTS HEREUNDER OR UNDER ANY NOTE OR OTHER LOAN DOCUMENT AND ALL INTEREST,
PENALTIES OR SIMILAR LIABILITIES WITH RESPECT THERETO, BUT EXCLUDING EXCLUDED
TAXES.  “EXCLUDED TAXES” SHALL MEAN:

 

(I)                                     ANY TAXES IMPOSED BY ANY JURISDICTION OR
BY ANY POLITICAL SUBDIVISION OR TAXING AUTHORITY THEREOF OR THEREIN MEASURED BY
OR BASED ON THE INCOME, NET INCOME OR PROFITS OR NET PROFITS OF LENDER, AND ANY
SALES OR USE, FRANCHISE OR SIMILAR (INCLUDING BRANCH PROFITS) TAXES IMPOSED ON
LENDER, AND

 

(II)                                  ANY TAXES IMPOSED BY REASON OF A LENDER
BEING OR HAVING BEEN A RESIDENT OR DEEMED RESIDENT OF, OR INCORPORATED IN THE
JURISDICTION IMPOSING THE TAXES OR CARRYING ON OR HAVING CARRIED ON OR DEEMED TO
HAVE BEEN CARRYING ON A TRADE OR BUSINESS OR PROVIDING SERVICES THEREIN OR
HAVING OR HAVING HAD A FIXED PLACE OF BUSINESS OR PERMANENT ESTABLISHMENT
THEREIN,  OTHER THAN SOLELY AS A RESULT OF ENTERING INTO, EXECUTING, DELIVERING
OR PERFORMING ITS OBLIGATIONS OR RECEIVING PAYMENTS UNDER OR ENFORCING THIS
AGREEMENT OR ANY LOAN DOCUMENT.

 

ANY BORROWER SHALL HAVE THE RIGHT TO DISPUTE OR CONTEST, AT ITS SOLE EXPENSE,
THE VALIDITY OF ANY ASSESSMENT OR REASSESSMENT OF TAXES IN RESPECT OF WHICH IT
IS REQUIRED TO PAY AN ADDITIONAL AMOUNT TO ANY AGENT OR LENDER.  THE AGENT OR
LENDER IN RESPECT OF WHICH SUCH TAXES ARE ASSESSED OR REASSESSED SHALL ASSIST
AND COOPERATE WITH SUCH BORROWER, AT SUCH BORROWER’S EXPENSE, IN ANY SUCH
DISPUTE OR CONTEST AS IS REASONABLY REQUESTED BY SUCH BORROWER.

 

(B)                                 IF A LENDER IS ELIGIBLE TO CLAIM AN
EXEMPTION FROM, OR REDUCTION IN THE RATE OF, UNITED STATES WITHHOLDING TAX, SUCH
LENDER AGREES WITH AND IN FAVOR OF ADMINISTRATIVE AGENT AND ANY BORROWER, TO
DELIVER TO ADMINISTRATIVE AGENT:

 

(I)                                     IF SUCH LENDER IS ELIGIBLE TO CLAIM AN
EXEMPTION FROM UNITED STATES WITHHOLDING TAX PURSUANT TO ITS PORTFOLIO INTEREST
EXCEPTION, (A) A STATEMENT OF THE LENDER, SIGNED UNDER PENALTY OF PERJURY, THAT
IT IS NOT (I) A “BANK” AS DESCRIBED IN SECTION 881(C)(3)(A) OF THE IRC, (II) A
10% SHAREHOLDER OF ANY BORROWER (WITHIN THE MEANING OF SECTION 871(H)(3)(B) OF
THE IRC), OR (III) A CONTROLLED FOREIGN CORPORATION RELATED TO ANY BORROWER
WITHIN THE MEANING OF SECTION 864(D)(4) OF THE IRC, AND (B) A PROPERLY COMPLETED

 

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AND EXECUTED IRS FORM W-8BEN, BEFORE RECEIVING ITS FIRST PAYMENT UNDER THIS
AGREEMENT AND AT ANY OTHER TIME REASONABLY REQUESTED BY ADMINISTRATIVE AGENT OR
ANY BORROWER;

 

(II)                                  IF SUCH LENDER IS ELIGIBLE TO CLAIM AN
EXEMPTION FROM, OR A REDUCTION OF, WITHHOLDING TAX UNDER A UNITED STATES TAX
TREATY, PROPERLY COMPLETED AND EXECUTED IRS FORM W-8BEN BEFORE RECEIVING ITS
FIRST PAYMENT UNDER THIS AGREEMENT AND AT ANY OTHER TIME REASONABLY REQUESTED BY
ADMINISTRATIVE AGENT OR ANY BORROWER;

 

(III)                               IF SUCH LENDER IS ELIGIBLE TO CLAIM THAT
INTEREST PAID UNDER THIS AGREEMENT IS EXEMPT FROM UNITED STATES WITHHOLDING TAX
BECAUSE IT IS EFFECTIVELY CONNECTED WITH A UNITED STATES TRADE OR BUSINESS OF
SUCH LENDER, TWO PROPERLY COMPLETED AND EXECUTED COPIES OF IRS FORM W-8ECI
BEFORE RECEIVING ITS FIRST PAYMENT UNDER THIS AGREEMENT AND AT ANY OTHER TIME
REASONABLY REQUESTED BY ADMINISTRATIVE AGENT OR ANY BORROWER; OR

 

(IV)                              SUCH OTHER FORM OR FORMS, INCLUDING IRS
FORM W-9, AS MAY BE REQUIRED UNDER THE IRC OR OTHER LAWS OF THE UNITED STATES AS
A CONDITION TO EXEMPTION FROM, OR REDUCTION OF, UNITED STATES WITHHOLDING OR
BACKUP WITHHOLDING TAX BEFORE RECEIVING ITS FIRST PAYMENT UNDER THIS AGREEMENT
AND AT ANY OTHER TIME REASONABLY REQUESTED BY ADMINISTRATIVE AGENT OR ANY
BORROWER.

 

Each Lender agrees promptly to notify Administrative Agent and Administrative
Borrower of any change in circumstances which would modify or render invalid any
claimed exemption or reduction.

 

(C)                                  IF A LENDER IS ELIGIBLE TO CLAIM AN
EXEMPTION FROM THE WITHHOLDING OR DEDUCTION OF TAXES FROM PAYMENTS MADE TO IT BY
A BORROWER IN A JURISDICTION OTHER THAN THE UNITED STATES, LENDER AGREES WITH
AND IN FAVOR OF ADMINISTRATIVE AGENT AND BORROWERS, TO DELIVER TO ADMINISTRATIVE
AGENT ANY SUCH FORM OR FORMS, AS MAY BE REQUIRED UNDER THE LAWS OF SUCH
JURISDICTION AS A CONDITION TO EXEMPTION FROM, OR REDUCTION IN THE RATE OF, SUCH
WITHHOLDING TAXES, INCLUDING WITHOUT LIMITATION, ANY BACKUP WITHHOLDING TAXES
BEFORE RECEIVING ITS FIRST PAYMENT UNDER THIS AGREEMENT AND AT ANY OTHER TIME
REASONABLY REQUESTED BY ADMINISTRATIVE AGENT OR ADMINISTRATIVE BORROWER.

 

Each Lender agrees promptly to notify Administrative Agent and Administrative
Borrower of any change in circumstances which would modify or render invalid any
claimed exemption or reduction.

 

(D)                                 IF ANY LENDER CLAIMS EXEMPTION FROM, OR
REDUCTION IN THE RATE OF, APPLICABLE WITHHOLDING TAXES AND SUCH LENDER SELLS,
ASSIGNS, GRANTS A PARTICIPATION IN, OR OTHERWISE TRANSFERS ALL OR PART OF THE
OBLIGATIONS OF BORROWERS TO ANOTHER LENDER, SUCH LENDER AGREES TO NOTIFY
ADMINISTRATIVE AGENT AND ADMINISTRATIVE BORROWER OF THE PERCENTAGE AMOUNT IN
WHICH IT IS NO LONGER THE BENEFICIAL OWNER OF OBLIGATIONS OF BORROWERS TO SUCH
LENDER.  TO THE EXTENT OF SUCH PERCENTAGE AMOUNT, ADMINISTRATIVE AGENT AND
BORROWERS WILL TREAT SUCH LENDER’S DOCUMENTATION PROVIDED PURSUANT TO SECTIONS
15.11(B) OR 15.11(C) AS NO LONGER VALID.  WITH RESPECT TO SUCH PERCENTAGE
AMOUNT, LENDER MAY PROVIDE NEW DOCUMENTATION, PURSUANT TO SECTIONS 15.11(B) OR
15.11(C), IF APPLICABLE.

 

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(E)                                  IF ANY LENDER IS ENTITLED TO A REDUCTION IN
THE RATE OF APPLICABLE WITHHOLDING TAX, THE APPLICABLE BORROWER OR THE
APPLICABLE AGENT, AS THE CASE MAY BE, MAY WITHHOLD FROM ANY INTEREST PAYMENT TO
SUCH LENDER AN AMOUNT EQUIVALENT TO THE APPLICABLE WITHHOLDING TAX AFTER TAKING
INTO ACCOUNT SUCH REDUCTION.  IF THE FORMS OR OTHER DOCUMENTATION REQUIRED BY
SUBSECTION (B) OR (C) OF THIS SECTION 15.11 ARE NOT DELIVERED TO ADMINISTRATIVE
AGENT, THEN THE APPLICABLE BORROWER OR THE APPLICABLE AGENT, AS THE CASE MAY BE,
MAY WITHHOLD FROM ANY INTEREST PAYMENT TO SUCH LENDER NOT PROVIDING SUCH FORMS
OR OTHER DOCUMENTATION AN AMOUNT EQUIVALENT TO THE APPLICABLE WITHHOLDING TAX.

 

(F)                                    IF THE IRS OR ANY OTHER GOVERNMENTAL
AUTHORITY OF THE UNITED STATES OR OTHER JURISDICTION ASSERTS A CLAIM THAT ANY
BORROWER OR ANY AGENT, AS THE CASE MAY BE, DID NOT PROPERLY WITHHOLD TAX FROM
AMOUNTS PAID TO OR FOR THE ACCOUNT OF ANY LENDER DUE TO A FAILURE ON THE PART OF
THE LENDER (BECAUSE THE APPROPRIATE FORM WAS NOT DELIVERED, WAS NOT PROPERLY
EXECUTED, OR BECAUSE SUCH LENDER FAILED TO NOTIFY ANY AGENT OF A CHANGE IN
CIRCUMSTANCES WHICH RENDERED THE EXEMPTION FROM, OR REDUCTION OF, WITHHOLDING
TAX INEFFECTIVE, OR FOR ANY OTHER REASON) SUCH LENDER SHALL INDEMNIFY AND HOLD
AGENTS AND BORROWERS HARMLESS FOR ALL AMOUNTS PAID, DIRECTLY OR INDIRECTLY, BY
AGENTS AND BORROWERS, AS TAX OR OTHERWISE, INCLUDING PENALTIES AND INTEREST, AND
INCLUDING ANY TAXES IMPOSED BY ANY JURISDICTION ON THE AMOUNTS PAYABLE TO ANY
AGENT AND BORROWERS UNDER THIS SECTION 15.11, TOGETHER WITH ALL COSTS AND
EXPENSES (INCLUDING ATTORNEYS FEES AND EXPENSES).  THE OBLIGATION OF THE LENDERS
UNDER THIS SUBSECTION SHALL SURVIVE THE PAYMENT OF ALL OBLIGATIONS AND THE
RESIGNATION OR REPLACEMENT OF ANY AGENT.

 

(G)                                 EACH LENDER SHALL, AT THE REQUEST OF
ADMINISTRATIVE AGENT OR ADMINISTRATIVE BORROWER, USE REASONABLE EFFORTS TO
COMPLY TIMELY WITH ANY CERTIFICATION, IDENTIFICATION, INFORMATION, DOCUMENTATION
OR OTHER REPORTING REQUIREMENTS IF SUCH COMPLIANCE IS REQUIRED BY LAW,
REGULATION, ADMINISTRATIVE PRACTICE OR AN APPLICABLE TREATY AS A PRECONDITION TO
EXEMPTION FROM, OR REDUCTION IN THE RATE OF, DEDUCTION OR WITHHOLDING OF ANY
TAXES FOR WHICH ANY BORROWER IS REQUIRED TO PAY ADDITIONAL AMOUNTS TO OR FOR THE
ACCOUNT OF SUCH LENDER PURSUANT TO THIS SECTION 15.11; PROVIDED THAT COMPLYING
WITH SUCH REQUIREMENTS WOULD NOT BE MATERIALLY MORE ONEROUS (IN FORM, IN
PROCEDURE OR IN SUBSTANCE OF INFORMATION DISCLOSED) TO SUCH LENDER THAN
COMPLYING WITH THE COMPARABLE INFORMATION OR OTHER REPORTING REQUIREMENTS
IMPOSED UNDER U.S. TAX LAW, REGULATIONS AND ADMINISTRATIVE PRACTICE.

 

(H)                                 IF ANY BORROWER IS REQUIRED TO PAY
ADDITIONAL AMOUNTS TO OR FOR THE ACCOUNT OF ANY LENDER PURSUANT TO THIS
SECTION 15.11 AS A RESULT OF A CHANGE OF LAW OCCURRING AFTER THE DATE HEREOF,
THEN SUCH LENDER AGREES TO DESIGNATE A DIFFERENT LENDING OFFICE IF SUCH
DESIGNATION WILL ELIMINATE OR MATERIALLY REDUCE SUCH ADDITIONAL PAYMENT WHICH
MAY THEREAFTER ACCRUE AND WOULD NOT, IN THE GOOD FAITH JUDGMENT OF SUCH LENDER,
OTHERWISE BE DISADVANTAGEOUS TO SUCH LENDER.

 

(I)                                     IF ANY ADDITIONAL AMOUNT PAYABLE BY ANY
BORROWER IS MADE TO OR FOR THE ACCOUNT OF ANY LENDER PURSUANT TO THIS
SECTION 15.11 ON ACCOUNT OF TAXES THEN, IF ANY LENDER RECEIVES OR IS GRANTED A
REFUND OF, CREDIT FOR OR REMISSION OF SUCH TAXES, SUCH LENDER SHALL REIMBURSE TO
BORROWERS SUCH AMOUNTS AS SUCH LENDER, ACTING REASONABLY, SHALL DETERMINE TO BE
ATTRIBUTABLE TO THE RELEVANT TAXES; PROVIDED, THAT (I) SUCH LENDER SHALL NOT BE
OBLIGATED TO

 

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DISCLOSE TO BORROWERS ANY INFORMATION REGARDING ITS TAX AFFAIRS AND
COMPUTATIONS, AND (II) NOTHING HEREIN SHALL BE CONSTRUED SO AS TO INTERFERE WITH
THE RIGHT OF SUCH LENDER TO ARRANGE ITS TAX AFFAIRS AS IT DEEMS APPROPRIATE.

 

(J)                                     LENDERS SHALL USE THEIR BEST EFFORTS TO
NOT SELL, ASSIGN, OR GRANT A PARTICIPATION IN, OR OTHERWISE TRANSFER ALL OR PART
OF THE OBLIGATIONS OF BORROWERS TO A LENDER THAT IS NOT ELIGIBLE TO CLAIM AN
EXEMPTION FROM UNITED STATES WITHHOLDING TAX.

 

15.12.              COLLATERAL MATTERS.

 

(A)                                  ALL LIENS ON COLLATERAL (I) SHALL BE
AUTOMATICALLY RELEASED UPON THE TERMINATION OF THE COMMITMENTS AND PAYMENT AND
SATISFACTION IN FULL BY BORROWERS OF ALL OBLIGATIONS, (II) CONSTITUTING PROPERTY
(INCLUDING THE EQUITY INTERESTS OF A SUBSIDIARY OF PARENT) BEING SOLD OR
DISPOSED OF IN A SALE OR DISPOSITION PERMITTED UNDER SECTION 6.4 OF THIS
AGREEMENT OR THE OTHER LOAN DOCUMENTS SHALL BE AUTOMATICALLY RELEASED UPON SUCH
SALE OR DISPOSITION, AND IN THE EVENT OF A SALE OR OTHER DISPOSITION OF ALL OF
THE EQUITY INTERESTS OF A SUBSIDIARY OF PARENT THAT IS A LOAN PARTY PERMITTED
UNDER THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS, SUCH SUBSIDIARY SHALL BE
AUTOMATICALLY RELEASED OF ITS OBLIGATIONS UNDER THE LOAN DOCUMENTS,
(III) CONSTITUTING PROPERTY IN WHICH NO LOAN PARTY OWNED ANY INTEREST AT THE
TIME THE AGENT’S LIEN WAS GRANTED NOR AT ANY TIME THEREAFTER SHALL BE
AUTOMATICALLY RELEASED, OR (IV) CONSTITUTING PROPERTY LEASED TO A BORROWER OR
ITS SUBSIDIARIES UNDER A LEASE THAT HAS EXPIRED OR IS TERMINATED IN A
TRANSACTION PERMITTED UNDER THIS AGREEMENT SHALL BE AUTOMATICALLY RELEASED.  THE
LENDERS HEREBY IRREVOCABLY AUTHORIZE COLLATERAL AGENT TO TAKE SUCH ACTIONS AND
EXECUTE SUCH DOCUMENTS THAT IT DEEMS NECESSARY OR APPROPRIATE, AT ITS OPTION AND
IN ITS SOLE DISCRETION, TO EVIDENCE THE FOREGOING RELEASES.  EXCEPT AS PROVIDED
ABOVE, COLLATERAL AGENT WILL NOT EXECUTE AND DELIVER A RELEASE OF ANY LIEN ON
ANY COLLATERAL WITHOUT THE PRIOR WRITTEN AUTHORIZATION OF (Y) IF THE RELEASE IS
OF ALL OR SUBSTANTIALLY ALL OF THE COLLATERAL, ALL OF THE LENDERS, OR
(Z) OTHERWISE, THE REQUIRED LENDERS.  UPON REQUEST BY COLLATERAL AGENT OR
ADMINISTRATIVE BORROWER AT ANY TIME, THE LENDERS WILL CONFIRM IN WRITING
COLLATERAL AGENT’S AUTHORITY TO RELEASE ANY SUCH LIENS ON PARTICULAR TYPES OR
ITEMS OF COLLATERAL PURSUANT TO THIS SECTION 15.12; PROVIDED, HOWEVER, THAT
(1) COLLATERAL AGENT SHALL NOT BE REQUIRED TO EXECUTE ANY DOCUMENT NECESSARY TO
EVIDENCE SUCH RELEASE ON TERMS THAT, IN COLLATERAL AGENT’S OPINION, WOULD EXPOSE
COLLATERAL AGENT TO LIABILITY OR CREATE ANY OBLIGATION OR ENTAIL ANY CONSEQUENCE
OTHER THAN THE RELEASE OF SUCH LIEN WITHOUT RECOURSE, REPRESENTATION, OR
WARRANTY, AND (2) SUCH RELEASE SHALL NOT IN ANY MANNER DISCHARGE, AFFECT, OR
IMPAIR THE OBLIGATIONS OR ANY LIENS (OTHER THAN THOSE EXPRESSLY BEING RELEASED)
UPON (OR OBLIGATIONS OF BORROWERS IN RESPECT OF) ALL INTERESTS RETAINED BY
BORROWERS, INCLUDING, THE PROCEEDS OF ANY SALE, ALL OF WHICH SHALL CONTINUE TO
CONSTITUTE PART OF THE COLLATERAL.

 

(B)                                 COLLATERAL AGENT AGREES, AT THE REQUEST OF
THE ADMINISTRATIVE BORROWER, TO TAKE SUCH ACTIONS AND EXECUTE SUCH DOCUMENTS
THAT ARE REASONABLY REQUESTED BY ADMINISTRATIVE BORROWER TO EVIDENCE THE RELEASE
OF ALL LIENS ON COLLATERAL (I) UPON THE TERMINATION OF THE COMMITMENTS AND
PAYMENT AND SATISFACTION IN FULL BY BORROWERS OF ALL OBLIGATIONS,
(II) CONSTITUTING PROPERTY (INCLUDING THE EQUITY INTERESTS OF A SUBSIDIARY OF
PARENT) BEING SOLD OR DISPOSED OF IF ADMINISTRATIVE BORROWER CERTIFIES TO
COLLATERAL AGENT THAT THE SALE OR DISPOSITION IS PERMITTED UNDER SECTION 6.4 OF
THIS AGREEMENT OR THE OTHER LOAN

 

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DOCUMENTS AND, IN THE EVENT OF A SALE OR OTHER DISPOSITION OF ALL OF THE EQUITY
INTERESTS OF A SUBSIDIARY OF PARENT THAT IS A LOAN PARTY PERMITTED UNDER THIS
AGREEMENT AND THE OTHER LOAN DOCUMENTS, TO EVIDENCE THE RELEASE OF SUCH
SUBSIDIARY’S OBLIGATIONS UNDER THE LOAN DOCUMENTS (AND LENDERS HEREBY AGREE
COLLATERAL AGENT MAY RELY CONCLUSIVELY ON ANY SUCH CERTIFICATE, WITHOUT FURTHER
INQUIRY), (III) CONSTITUTING PROPERTY IN WHICH NO LOAN PARTY OWNED ANY INTEREST
AT THE TIME THE AGENT’S LIEN WAS GRANTED NOR AT ANY TIME THEREAFTER, AND
(IV) CONSTITUTING PROPERTY LEASED TO A BORROWER OR ITS SUBSIDIARIES UNDER A
LEASE THAT HAS EXPIRED OR IS TERMINATED IN A TRANSACTION PERMITTED UNDER THIS
AGREEMENT.  AGENTS AND LENDERS AGREE THAT AFTER THE PAYMENT IN FULL OF THE TERM
LOAN A AND THE TERM B DEBT AND THE RECEIPT BY COLLATERAL AGENT OF EVIDENCE, IN
FORM AND SUBSTANCE REASONABLY SATISFACTORY TO COLLATERAL AGENT, THAT ALL LIENS
SECURING THE TERM B DEBT HAVE BEEN RELEASED (OR WILL BE RELEASED
CONTEMPORANEOUSLY), COLLATERAL AGENT SHALL TAKE SUCH ACTIONS AND EXECUTE SUCH
DOCUMENTS THAT ARE REASONABLY REQUESTED BY ADMINISTRATIVE BORROWER TO EVIDENCE
THE RELEASE OF ALL AGENT’S LIENS ON THE STOCK OF FOREIGN SUBSIDIARIES, REAL
PROPERTY OF THE US BORROWERS AND THE ASSETS OF THE US BORROWERS REFERRED TO IN
CLAUSES (C), (E), (F), (G), (H), (I), (J), AND (K) OF SECTION 2 OF THE US
SECURITY AGREEMENT OTHER THAN (I) GENERAL INTANGIBLES (AS DEFINED IN THE US
SECURITY AGREEMENT) RELATING TO ACCOUNTS, (II) STOCK OF US LOAN PARTIES,
(III) ALL MONETARY OBLIGATIONS OWED BY A BORROWER TO ANOTHER BORROWER IN
CONNECTION WITH ANY INTERCOMPANY LOANS OR ADVANCES AND ALL PROMISSORY NOTES AND
INSTRUMENTS EVIDENCING ANY SUCH MONETARY OBLIGATION, LOAN OR ADVANCE AND
(IV) LETTERS OF CREDIT, LETTER OF CREDIT RIGHTS AND SUPPORTING OBLIGATIONS (AS
DEFINED IN THE US SECURITY AGREEMENT) ISSUED IN SUPPORT OF ACCOUNTS (AND,
FOLLOWING SUCH RELEASE, SUCH ASSETS SHALL NO LONGER CONSTITUTE “COLLATERAL” FOR
PURPOSES OF THE LOAN DOCUMENTS).

 

(C)                                  COLLATERAL AGENT SHALL HAVE NO OBLIGATION
WHATSOEVER TO ANY OF THE LENDERS TO ASSURE THAT THE COLLATERAL EXISTS OR IS
OWNED BY BORROWERS OR IS CARED FOR, PROTECTED, OR INSURED OR HAS BEEN
ENCUMBERED, OR THAT THE AGENT’S LIENS HAVE BEEN PROPERLY OR SUFFICIENTLY OR
LAWFULLY CREATED, PERFECTED, PROTECTED, OR ENFORCED OR ARE ENTITLED TO ANY
PARTICULAR PRIORITY, OR TO EXERCISE AT ALL OR IN ANY PARTICULAR MANNER OR UNDER
ANY DUTY OF CARE, DISCLOSURE OR FIDELITY, OR TO CONTINUE EXERCISING, ANY OF THE
RIGHTS, AUTHORITIES AND POWERS GRANTED OR AVAILABLE TO COLLATERAL AGENT PURSUANT
TO ANY OF THE LOAN DOCUMENTS, IT BEING UNDERSTOOD AND AGREED THAT IN RESPECT OF
THE COLLATERAL, OR ANY ACT, OMISSION, OR EVENT RELATED THERETO, SUBJECT TO THE
TERMS AND CONDITIONS CONTAINED HEREIN, COLLATERAL AGENT MAY ACT IN ANY MANNER IT
MAY DEEM APPROPRIATE, IN ITS SOLE DISCRETION GIVEN COLLATERAL AGENT’S OWN
INTEREST IN THE COLLATERAL IN ITS CAPACITY AS ONE OF THE LENDERS AND THAT
COLLATERAL AGENT SHALL HAVE NO OTHER DUTY OR LIABILITY WHATSOEVER TO ANY LENDER
AS TO ANY OF THE FOREGOING, EXCEPT AS OTHERWISE PROVIDED HEREIN.

 

15.13.              RESTRICTIONS ON ACTIONS BY LENDERS; SHARING OF PAYMENTS.

 

(A)                                  EACH OF THE LENDERS AGREES THAT IT SHALL
NOT, WITHOUT THE EXPRESS WRITTEN CONSENT OF ADMINISTRATIVE AGENT, AND THAT IT
SHALL, TO THE EXTENT IT IS LAWFULLY ENTITLED TO DO SO, UPON THE WRITTEN REQUEST
OF ADMINISTRATIVE AGENT AFTER THE OCCURRENCE AND DURING THE CONTINUANCE OF AN
EVENT OF DEFAULT, SET OFF AGAINST THE OBLIGATIONS, ANY AMOUNTS OWING BY SUCH
LENDER TO BORROWERS OR ANY DEPOSIT ACCOUNTS OF BORROWERS NOW OR HEREAFTER
MAINTAINED WITH SUCH LENDER.  EACH OF THE LENDERS FURTHER AGREES THAT IT SHALL
NOT, UNLESS SPECIFICALLY

 

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REQUESTED TO DO SO IN WRITING BY ADMINISTRATIVE AGENT AFTER THE OCCURRENCE AND
DURING THE CONTINUANCE OF AN EVENT OF DEFAULT, TAKE OR CAUSE TO BE TAKEN ANY
ACTION, INCLUDING, THE COMMENCEMENT OF ANY LEGAL OR EQUITABLE PROCEEDINGS, TO
FORECLOSE ANY LIEN ON, OR OTHERWISE ENFORCE ANY SECURITY INTEREST IN, ANY OF THE
COLLATERAL.

 

(B)                                 IF, AT ANY TIME OR TIMES ANY LENDER SHALL
RECEIVE (I) BY PAYMENT, FORECLOSURE, SETOFF, OR OTHERWISE, ANY PROCEEDS OF
COLLATERAL OR ANY PAYMENTS WITH RESPECT TO THE OBLIGATIONS, EXCEPT FOR ANY SUCH
PROCEEDS OR PAYMENTS RECEIVED BY SUCH LENDER FROM ANY AGENT PURSUANT TO THE
TERMS OF THIS AGREEMENT, OR (II) PAYMENTS FROM ANY AGENT IN EXCESS OF SUCH
LENDER’S RATABLE PORTION OF ALL SUCH DISTRIBUTIONS BY AGENTS, SUCH LENDER
PROMPTLY SHALL (1) TURN THE SAME OVER TO THE APPLICABLE AGENT, IN KIND, AND WITH
SUCH ENDORSEMENTS AS MAY BE REQUIRED TO NEGOTIATE THE SAME TO SUCH AGENT, OR IN
IMMEDIATELY AVAILABLE FUNDS, AS APPLICABLE, FOR THE ACCOUNT OF ALL OF THE
LENDERS AND FOR APPLICATION TO THE OBLIGATIONS IN ACCORDANCE WITH THE APPLICABLE
PROVISIONS OF THIS AGREEMENT, OR (2) PURCHASE, WITHOUT RECOURSE OR WARRANTY, AN
UNDIVIDED INTEREST AND PARTICIPATION IN THE OBLIGATIONS OWED TO THE OTHER
LENDERS SO THAT SUCH EXCESS PAYMENT RECEIVED SHALL BE APPLIED RATABLY AS AMONG
THE LENDERS IN ACCORDANCE WITH THEIR PRO RATA SHARES; PROVIDED, HOWEVER, THAT TO
THE EXTENT THAT SUCH EXCESS PAYMENT RECEIVED BY THE PURCHASING PARTY IS
THEREAFTER RECOVERED FROM IT, THOSE PURCHASES OF PARTICIPATIONS SHALL BE
RESCINDED IN WHOLE OR IN PART, AS APPLICABLE, AND THE APPLICABLE PORTION OF THE
PURCHASE PRICE PAID THEREFOR SHALL BE RETURNED TO SUCH PURCHASING PARTY, BUT
WITHOUT INTEREST EXCEPT TO THE EXTENT THAT SUCH PURCHASING PARTY IS REQUIRED TO
PAY INTEREST IN CONNECTION WITH THE RECOVERY OF THE EXCESS PAYMENT.

 

15.14.              AGENCY FOR PERFECTION.

 

Collateral Agent hereby appoints each other Lender as its agent (and each Lender
hereby accepts such appointment) for the purpose of perfecting the Agent’s Liens
in assets which, in accordance with Article 8 or Article 9, as applicable, of
the Code and/or the PPSA, as applicable, can be perfected only by possession or
control.  Should any Lender obtain possession or control of any such Collateral,
such Lender shall notify Collateral Agent thereof, and, promptly upon Collateral
Agent’s request therefor shall deliver possession or control of such Collateral
to Collateral Agent or in accordance with Collateral Agent’s instructions.

 

15.15.              PAYMENTS BY AGENT TO THE LENDERS.

 

All payments to be made by an Agent to the Lenders shall be made by bank wire
transfer of immediately available funds pursuant to such wire transfer
instructions as each party may designate for itself by written notice to the
applicable Agent.  Concurrently with each such payment, the applicable Agent
shall identify whether such payment (or any portion thereof) represents
principal, premium, fees, or interest of the Obligations.

 

15.16.              CONCERNING THE COLLATERAL AND RELATED LOAN DOCUMENTS.

 

Each member of the Lender Group authorizes and directs each Agent to enter into
this Agreement, the other Loan Documents and the Intercreditor Agreement.  Each

 

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member of the Lender Group agrees that any action taken by any Agent in
accordance with the terms of this Agreement, the other Loan Documents and the
Intercreditor Agreement relating to the Collateral and the exercise by any Agent
of its powers set forth therein or herein, together with such other powers that
are reasonably incidental thereto, shall be binding upon all of the Lenders.

 

15.17.              FIELD AUDITS AND EXAMINATION REPORTS; CONFIDENTIALITY;
DISCLAIMERS BY LENDERS; OTHER REPORTS AND INFORMATION.

 

By becoming a party to this Agreement, each Lender:

 

(A)                                  IS DEEMED TO HAVE REQUESTED THAT EACH AGENT
FURNISH SUCH LENDER, PROMPTLY AFTER IT BECOMES AVAILABLE, A COPY OF EACH FIELD
AUDIT OR EXAMINATION REPORT (EACH A “REPORT” AND COLLECTIVELY, “REPORTS”)
PREPARED BY OR AT THE REQUEST OF SUCH AGENT, AND SUCH AGENT SHALL SO FURNISH
EACH LENDER WITH SUCH REPORTS,

 

(B)                                 EXPRESSLY AGREES AND ACKNOWLEDGES THAT NO
AGENT (I) MAKES ANY REPRESENTATION OR WARRANTY AS TO THE ACCURACY OF ANY REPORT,
AND (II) SHALL NOT BE LIABLE FOR ANY INFORMATION CONTAINED IN ANY REPORT,

 

(C)                                  EXPRESSLY AGREES AND ACKNOWLEDGES THAT THE
REPORTS ARE NOT COMPREHENSIVE AUDITS OR EXAMINATIONS, THAT ANY AGENT OR OTHER
PARTY PERFORMING ANY AUDIT OR EXAMINATION WILL INSPECT ONLY SPECIFIC INFORMATION
REGARDING BORROWERS AND WILL RELY SIGNIFICANTLY UPON THE BOOKS AND RECORDS OF
BORROWERS AND THEIR SUBSIDIARIES, AS WELL AS ON REPRESENTATIONS OF BORROWERS’
PERSONNEL,

 

(D)                                 AGREES TO KEEP ALL REPORTS AND OTHER
MATERIAL, NON-PUBLIC INFORMATION REGARDING BORROWERS AND THEIR SUBSIDIARIES AND
THEIR OPERATIONS, ASSETS, AND EXISTING AND CONTEMPLATED BUSINESS PLANS AND ANY
INFORMATION RELATING TO ANY AGREEMENT WHICH ANY BORROWER OR ANY OF ITS
SUBSIDIARIES IS A PARTY (OTHER THAN THE LOAN DOCUMENTS) IN A CONFIDENTIAL MANNER
IN ACCORDANCE WITH SECTION 16.8, AND

 

(E)                                  WITHOUT LIMITING THE GENERALITY OF ANY
OTHER INDEMNIFICATION PROVISION CONTAINED IN THIS AGREEMENT, AGREES:  (I) TO
HOLD ANY AGENT AND ANY SUCH OTHER LENDER PREPARING A REPORT HARMLESS FROM ANY
ACTION THE INDEMNIFYING LENDER MAY TAKE OR FAIL TO TAKE OR ANY CONCLUSION THE
INDEMNIFYING LENDER MAY REACH OR DRAW FROM ANY REPORT IN CONNECTION WITH ANY
LOANS OR OTHER CREDIT ACCOMMODATIONS THAT THE INDEMNIFYING LENDER HAS MADE OR
MAY MAKE TO BORROWERS, OR THE INDEMNIFYING LENDER’S PARTICIPATION IN, OR THE
INDEMNIFYING LENDER’S PURCHASE OF, A LOAN OR LOANS OF BORROWERS; AND (II) TO PAY
AND PROTECT, AND INDEMNIFY, DEFEND AND HOLD ANY AGENT AND ANY SUCH OTHER LENDER
PREPARING A REPORT HARMLESS FROM AND AGAINST, THE CLAIMS, ACTIONS, PROCEEDINGS,
DAMAGES, COSTS, EXPENSES, AND OTHER AMOUNTS (INCLUDING, ATTORNEYS FEES AND
COSTS) INCURRED BY ANY AGENT AND ANY SUCH OTHER LENDER PREPARING A REPORT AS THE
DIRECT OR INDIRECT RESULT OF ANY THIRD PARTIES WHO MIGHT OBTAIN ALL OR PART OF
ANY REPORT THROUGH THE INDEMNIFYING LENDER.

 

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In addition to the foregoing:  (x) any Lender may from time to time request of
Administrative Agent in writing that Administrative Agent provide to such Lender
a copy of any report or document provided by Borrowers to Administrative Agent
that has not been contemporaneously provided by Borrowers to such Lender, and,
upon receipt of such request, Administrative Agent promptly shall provide a copy
of same to such Lender, (y) to the extent that Administrative Agent is entitled,
under any provision of the Loan Documents, to request additional reports or
information from Borrowers, or any Lender may, from time to time, reasonably
request Administrative Agent to exercise such right as specified in such
Lender’s notice to Administrative Agent, whereupon Administrative Agent promptly
shall request of Administrative Borrower the additional reports or information
reasonably specified by such Lender, and, upon receipt thereof from
Administrative Borrower, Administrative Agent promptly shall provide a copy of
same to such Lender, and (z) any time that Administrative Agent renders to
Administrative Borrower a statement regarding a Loan Account, Administrative
Agent shall send a copy of such statement to each Lender.

 

15.18.              SEVERAL OBLIGATIONS; NO LIABILITY.

 

Notwithstanding that certain of the Loan Documents now or hereafter may have
been or will be executed only by or in favor of any Agent in its capacity as
such, and not by or in favor of the Lenders, any and all obligations on the part
of any Agent (if any) to make any credit available hereunder shall constitute
the several (and not joint) obligations of the respective Lenders on a ratable
basis, according to their respective Commitments, to make an amount of such
credit not to exceed, in principal amount, at any one time outstanding, the
amount of their respective Commitments.  Nothing contained herein shall confer
upon any Lender any interest in, or subject any Lender to any liability for, or
in respect of, the business, assets, profits, losses, or liabilities of any
other Lender.  Each Lender shall be solely responsible for notifying its
Participants of any matters relating to the Loan Documents to the extent any
such notice may be required, and no Lender shall have any obligation, duty, or
liability to any Participant of any other Lender.  Except as provided in
Section 16.8, no member of the Lender Group shall have any liability for the
acts of any other member of the Lender Group.  No Lender shall be responsible to
any Borrower or any other Person for any failure by any other Lender to fulfill
its obligations to make credit available hereunder, nor to advance for it or on
its behalf in connection with its Commitment, nor to take any other action on
its behalf hereunder or in connection with the financing contemplated herein.

 

15.19.              BANK PRODUCT PROVIDERS.

 

Each Bank Product Provider shall be deemed a party hereto for purposes of any
reference in a Loan Document to the parties for whom Agents are acting; it being
understood and agreed that the rights and benefits of such Bank Product Provider
under the Loan Documents consist exclusively of such Bank Product Provider’s
right to share in payments and collections out of the Collateral as more fully
set forth herein.  In connection with any such distribution of payments and
collections, Agents shall be entitled to assume no amounts are due to any Bank
Product Provider unless such Bank Product Provider has

 

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notified such Agent in writing of the amount of any such liability owed to it
prior to such distribution.

 

15.20.              QUEBEC SECURITY.

 

For greater certainty, and without limiting the powers of the Collateral Agent,
or any other Person acting as an agent or mandatary for the Collateral Agent
hereunder or under any other Loan Documents, the Borrowers hereby acknowledge
that, for purposes of holding any hypothecs and security granted by the
Borrowers or their Subsidiaries on property pursuant to the laws of the Province
of Quebec to secure obligations of the Borrowers or their Subsidiaries under any
debenture or bond issued by the Borrowers or their Subsidiaries, the Collateral
Agent shall be the holder of an irrevocable power of attorney (fondé de pouvoir)
(within the meaning of the Civil Code of Quebec) for the Lender Group and the
Bank Product Provider, including without limitation, all present and future
Lenders and any Affiliate of a Lender that may from time to time enter into
Hedge Agreements with the Borrowers or their Subsidiaries, and in particular for
all present and future holders of any such debenture or bond.  The Lender Group
and the Bank Product Provider hereby : (i) irrevocably constitute, to the extent
necessary, the Collateral Agent as the holder of an irrevocable power of
attorney (fondé de pouvoir) (within the meaning of Article 2692 of the Civil
Code of Quebec) in order to hold hypothecs and security granted by the Borrowers
or their Subsidiaries on property pursuant to the laws of the Province of Quebec
to secure the obligations of the Borrowers or their Subsidiaries under any
debenture or bond issued by the Borrowers or their Subsidiaries; and (ii) 
appoint and agree that the Canadian Administrative Agent or the Collateral Agent
may act as the bondholder and mandatary with respect to any debenture or bond
that may be issued by the Borrowers or their Subsidiaries and pledged in its
favour from time to time.

 

The said constitution of the Collateral Agent as the holder of such irrevocable
power of attorney (fondé de pouvoir) and of the Canadian Administrative Agent or
the Collateral Agent as bondholder and mandatory shall be deemed to have been
ratified and confirmed as follows:

 

(I)                                     BY ANY ASSIGNEE, BY THE EXECUTION OF AN
ASSIGNMENT AND ACCEPTANCE; AND

 

(II)                                  BY ANY AFFILIATE OF A LENDER THAT ENTERS
INTO HEDGE AGREEMENTS, BY THE EXECUTION OF THE HEDGE AGREEMENTS.

 

Notwithstanding the provisions of Section 32 of An Act respecting the special
powers of legal persons (Quebec), the Collateral Agent may acquire and be the
holder of any debenture or bond issued by the Borrowers or their Subsidiaries
(i.e. the fondé de pouvoir may acquire and hold the first debenture or bond
issued under any deed of hypothec by the Borrowers or their Subsidiaries).  The
Borrowers hereby acknowledge that such debenture or bond constitutes a title of
indebtedness, as such term is used in Article 2692 of the Civil Code of Quebec.

 

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The Collateral Agent herein appointed as fondé de pouvoir shall have the same
rights, powers and immunities as the Agents as stipulated herein, including
under this Section 15, which shall apply mutatis mutandis.  Without limitation,
the provisions of Section 15.9 shall apply mutatis mutandis to the resignation
and appointment of a successor Collateral Agent acting as fondé de pouvoir.

 

16.                               GENERAL PROVISIONS.

 

16.1.                     INTENTIONALLY OMITTED.

 

16.2.                     EFFECTIVENESS.

 

This Agreement shall be binding and deemed effective when executed by Borrowers,
Agents, and each Lender whose signature is provided for on the signature
pages hereof.

 

16.3.                     SECTION HEADINGS.

 

Headings and numbers have been set forth herein for convenience only.  Unless
the contrary is compelled by the context, everything contained in each
Section applies equally to this entire Agreement.

 

16.4.                     INTERPRETATION.

 

Neither this Agreement nor any uncertainty or ambiguity herein shall be
construed against the Lender Group or Borrowers, whether under any rule of
construction or otherwise.  On the contrary, this Agreement has been reviewed by
all parties and shall be construed and interpreted according to the ordinary
meaning of the words used so as to accomplish fairly the purposes and intentions
of all parties hereto.

 

16.5.                     SEVERABILITY OF PROVISIONS.

 

Each provision of this Agreement shall be severable from every other provision
of this Agreement for the purpose of determining the legal enforceability of any
specific provision.

 

16.6.                     COUNTERPARTS; ELECTRONIC EXECUTION.

 

This Agreement may be executed in any number of counterparts and by different
parties on separate counterparts, each of which, when executed and delivered,
shall be deemed to be an original, and all of which, when taken together, shall
constitute but one and the same Agreement.  Delivery of an executed counterpart
of this Agreement by telefacsimile or other electronic method of transmission
shall be equally as effective as delivery of an original executed counterpart of
this Agreement.  Any party delivering an executed counterpart of this Agreement
by telefacsimile or other electronic method of transmission also shall deliver
an original executed counterpart of this Agreement but the failure to deliver an
original executed counterpart shall not affect the validity, enforceability,

 

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and binding effect of this Agreement.  The foregoing shall apply to each other
Loan Document mutatis mutandis.

 

16.7.                     REVIVAL AND REINSTATEMENT OF OBLIGATIONS.

 

If the incurrence or payment of the Obligations by any Borrower or any Guarantor
or the transfer to the Lender Group of any property should for any reason
subsequently be declared to be void or voidable under any state 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 Lender Group is required to repay or restore,
in whole or in part, any such Voidable Transfer, or elects to do so upon the
reasonable advice of its counsel, then, as to any such Voidable Transfer, or the
amount thereof that the Lender Group is required or elects to repay or restore,
and as to all reasonable costs, expenses, and attorneys fees of the Lender Group
related thereto, the liability of Borrowers or Guarantors automatically shall be
revived, reinstated, and restored and shall exist as though such Voidable
Transfer had never been made.

 

16.8.                     CONFIDENTIALITY.

 

Agents and Lenders each individually (and not jointly or jointly and severally)
agree that (i) material, non-public information regarding Borrowers and their
Subsidiaries, their operations, assets, and existing and contemplated business
plans and (ii) any information relating to any agreement which any Borrower or
any of its Subsidiaries is a party (other than the Loan Documents) shall be
treated by Agents and the Lenders in a confidential manner, and shall not be
disclosed by Agents and the Lenders to Persons who are not parties to this
Agreement, except:  (a) to attorneys for and other advisors, accountants,
auditors, and consultants to any member of the Lender Group, (b) to Subsidiaries
and Affiliates of any member of the Lender Group (including the Bank Product
Providers), provided that any such Subsidiary or Affiliate shall have agreed to
receive such information hereunder subject to the terms of this Section 16.8,
(c) as may be required by statute, decision, or judicial or administrative
order, rule, or regulation, (d) as may be agreed to in advance by Administrative
Borrower or its Subsidiaries or as requested or required by any Governmental
Authority pursuant to any subpoena or other legal process, (e) as to any such
information that is or becomes generally available to the public (other than as
a result of prohibited disclosure by Agents or the Lenders), (f) in connection
with any assignment, prospective assignment, sale, prospective sale,
participation or prospective participations, or pledge or prospective pledge of
any Lender’s interest under this Agreement, provided that any such assignee,
prospective assignee, purchaser, prospective purchaser, participant, prospective
participant, pledgee, or prospective pledgee shall have agreed in writing to
receive such information hereunder subject to the terms of this Section, and
(g) in connection with any litigation or other adversary proceeding involving
parties hereto which such litigation or adversary proceeding involves claims
related to the rights or duties of such parties under this Agreement or the
other Loan Documents.  The provisions of this Section 16.8 shall survive for 2
years after the payment in full of the Obligations.

 

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16.9.                     KNOW YOUR CUSTOMER.

 

If:

 

(A)                                  THE INTRODUCTION OF OR ANY CHANGE IN (OR IN
THE INTERPRETATION, ADMINISTRATION OR APPLICATION OF) ANY LAW OR REGULATION MADE
AFTER THE DATE OF THIS AGREEMENT; OR

 

(B)                                 ANY CHANGE IN THE STATUS OF ANY BORROWER OR
THE COMPOSITION OR OWNERSHIP OF THE SHAREHOLDERS OR PARTNERS OF ANY BORROWER, AS
THE CASE MAY BE, AFTER THE DATE OF THIS AGREEMENT; OR

 

(C)                                  A PROPOSED ASSIGNMENT OR TRANSFER BY THE
AGENT OR ANY LENDER OF ANY OF THEIR RESPECTIVE RIGHTS AND/OR OBLIGATIONS UNDER
THIS AGREEMENT TO A THIRD PARTY PRIOR TO SUCH ASSIGNMENT OR TRANSFER,

 

obliges the Agent or any Lender (or, in the case of paragraph (c) above, any
prospective new Agent or new Lender) to comply with “know your customer” or
similar identification procedures in circumstances where the necessary
information is not already available to it, the Borrower concerned shall,
promptly upon the request of Agent or such Lender supply such documentation and
other evidence as is reasonably requested by the Agent (for itself or on behalf
of any Lender) or any Lender (for itself or, in the case of any event described
in paragraph (c) above, on behalf of any prospective new Lender) in order for
the Agent, such Lender or, in the case of the event described in paragraph
(c) above, any prospective new Lender to carry out and be satisfied with the
results of all necessary “know your customer” or other similar checks under all
Applicable Law and regulations pursuant to the transactions contemplated in the
Loan Documents.

 

16.10.              INTEGRATION.

 

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.

 

16.11.              PARENT AS ADMINISTRATIVE AGENT FOR BORROWERS.

 

Each Borrower hereby irrevocably appoints Parent as the borrowing agent and
attorney-in-fact for all Borrowers (the “Administrative Borrower”) which
appointment shall remain in full force and effect unless and until
Administrative Agent shall have received prior written notice signed by each
Borrower that such appointment has been revoked and that another Borrower has
been appointed Administrative Borrower.  Each Borrower hereby irrevocably
appoints and authorizes the Administrative Borrower (i) to provide
Administrative Agent, Canadian Administrative Agent and European Administrative
Agent, as applicable, with all notices with respect to Advances and Letters of
Credit obtained for the benefit of any Borrower and all other notices and
instructions under this Agreement and (ii) to take such action as the
Administrative Borrower deems appropriate on its behalf to

 

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obtain Advances and Letters of Credit and to exercise such other powers as are
reasonably incidental thereto to carry out the purposes of this Agreement.  It
is understood that the handling of the Loan Accounts and Collateral of Borrowers
in a combined fashion, as more fully set forth herein, is done solely as an
accommodation to Borrowers in order to utilize the collective borrowing powers
of Borrowers in the most efficient and economical manner and at their request,
and that Lender Group shall not incur liability to any Borrower as a result
hereof.  Each Borrower expects to derive benefit, directly or indirectly, from
the handling of the Loan Accounts and the Collateral in a combined fashion since
the successful operation of each Borrower is dependent on the continued
successful performance of the integrated group.  To induce the Lender Group to
do so, and in consideration thereof, each Borrower hereby jointly and severally
agrees to indemnify each member of the Lender Group and hold each member of the
Lender Group harmless against any and all liability, expense, loss or claim of
damage or injury, made against the Lender Group by any Borrower or by any third
party whosoever, arising from or incurred by reason of (a) the handling of the
Loan Accounts and Collateral of Borrowers as herein provided, (b) the Lender
Group’s relying on any instructions of the Administrative Borrower, or (c) any
other action taken by the Lender Group hereunder or under the other Loan
Documents, except that Borrowers will have no liability to the relevant
Agent-Related Person or Lender-Related Person under this Section 16.11 with
respect to any liability that has been finally determined by a court of
competent jurisdiction to have resulted solely from the gross negligence or
willful misconduct of such Agent-Related Person or Lender-Related Person, as the
case may be; provided, that in no event shall Foreign Borrowers be liable with
respect to any liability hereunder of US Loan Parties.

 

[Signature pages to follow.]

 

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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
and delivered as of the date first above written.

 

 

 

SITEL CORPORATION
a Minnesota corporation

 

 

 

 

 

By:

/s/

 

 

Title:

 

 

 

 

 

 

 

 

 

 

 

NATIONAL ACTION FINANCIAL
SERVICES, INC.
a Georgia corporation

 

 

 

 

 

By:

/s/

 

 

Title:

 

 

 

 

 

 

 

 

 

SITEL HOME MORTGAGE CORP. 
a Nebraska corporation

 

 

 

 

 

By:

/s/

 

 

Title:

 

 

 

 

 

 

 

 

 

FINANCIAL INSURANCE SERVICES,
INC. 
a Nebraska corporation

 

 

 

 

 

By:

/s/

 

 

Title:

 

 

 

 

 

 

 

 

 

 

 

SITEL INTERNATIONAL LLC
a Delaware limited liability company

 

 

 

 

 

By:

/s/

 

 

Title:

 

 

 

Credit Agreement Signature Page

 

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SITEL UK LIMITED 
a corporation organized under the laws of
England and Wales

 

 

 

 

 

By:

/s/

 

 

Title:

 

 

 

 

 

 

 

 

 

 

 

SITEL EUROPE LIMITED 
a corporation organized under the laws of
England and Wales

 

 

 

 

 

By:

/s/

 

 

Title:

 

 

 

 

 

 

 

 

 

SITEL IRELAND LIMITED 
a corporation organized under the laws of
Ireland

 

 

 

 

 

By:

/s/

 

 

Title:

 

 

 

 

 

 

 

 

 

SITEL TELESERVICES CANADA INC. 
an Ontario corporation

 

 

 

 

 

By:

/s/

 

 

Title:

 

 

 

 

 

 

 

 

 

 

 

SITEL INSURANCE SERVICES
CANADA INC. 
an Ontario corporation

 

 

 

 

 

By:

/s/

 

 

Title:

 

 

 

2

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

 

 

SITEL CUSTOMER CARE, INC. 
an Ontario corporation

 

 

 

 

 

By:

/s/

 

 

Title:

 

 

 

 

 

 

 

 

 

 

 

SITEL GmbH
a limited liability company organized under
the laws of Germany

 

 

 

 

 

By:

/s/

 

 

Title:

 

 

 

 

 

 

By:

/s/

 

 

Title:

 

 

 

 

 

 

 

 

 

SRM INKASSO GMBH
a limited liability company organized under
the laws of Germany

 

 

 

 

 

By:

/s/

 

 

Title:

 

 

 

 

 

 

By:

/s/

 

 

Title:

 

 

 

3

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WELLS FARGO FOOTHILL, INC.,
a California corporation, as Administrative
Agent, European Administrative Agent,
Collateral Agent, Fronting Lender and as a
Lender

 

 

 

 

 

By:

/s/

 

 

Title:

 

 

 

 

 

 

 

WELLS FARGO FINANCIAL
CORPORATION CANADA,
a Nova Scotia unlimited liability company,
as Canadian Administrative Agent and as a
Lender

 

 

 

 

 

By:

/s/

 

 

Title:

 

 

 

4

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SCHEDULE 1.1

 

As used in the Agreement, the following terms shall have the following
definitions:

 

“Account” means an account (as that term is defined in the Code).

 

“Account Debtor” means any Person who is obligated on an Account, chattel paper,
or a general intangible.

 

“ACH Transactions” means any cash management or related services (including the
Automated Clearing House processing of electronic funds transfers through the
direct Federal Reserve Fedline system) provided by a Bank Product Provider for
the account of Loan Parties and Significant Subsidiaries.

 

“Additional German Opinion Costs” means any costs or expenses incurred by any
Agent in connection with obtaining a German law legal opinion for the benefit of
any Lender that has requested such an opinion to the extent such Lender is not
permitted to rely on any German legal opinion (either directly or through a
reliance letter in form and substance reasonably satisfactory to such Lender)
delivered on the Closing Date to the same extent as the Lenders party to the
Credit Agreement on the Closing Date.

 

“Additional Permitted Debt” means Indebtedness of any Loan Party or Significant
Subsidiary to the extent (i) that, after giving effect to the incurrence of such
Indebtedness, the Leverage Ratio, on a pro forma basis as of the last day of the
then most recently ended month for which financial statements have been
delivered, is equal to or less than 5.0:1.0, (ii) that, after giving effect to
the incurrence of such Indebtedness, Borrowers are in compliance with
Section 6.17(a)(ii) (determined as if no Covenant Suspension Event has occurred)
on a pro forma basis, as of the then most recent month end for which financial
statements have been delivered, (iii) such Indebtedness is incurred on
customary, market terms that have been negotiated on an arm’s-length basis with
a Person other than an Affiliate of any Borrower, (iv) such Indebtedness has
terms or conditions (other than pricing terms) that, taken as a whole, are not
more burdensome or restrictive to the Loan Parties than the Loan Documents,
(v) no Event of Default shall have occurred and be continuing or would result
from the incurrence of such Indebtedness, (vi) such Indebtedness is not secured
by Liens on Collateral and (vii) to the extent such Indebtedness is secured by
Liens on assets of any Borrower, such Indebtedness is subject to an
Intercreditor Agreement reasonably acceptable to Administrative Agent.

 

“Administrative Agent” has the meaning specified therefor in the preamble to the
Agreement.

 

“Administrative Agent’s Account” means, with respect to Dollars, the applicable
Deposit Account of Administrative Agent identified on Schedule A-1 as the
Administrative Agent’s Dollar Deposit Account, with respect to Euro, the
applicable Deposit Account of Administrative Agent identified on Schedule A-1 as
the Administrative Agent’s

 

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Euro Deposit Account and, with respect to Sterling, the applicable Deposit
Account of Administrative Agent identified on Schedule A-1 as the Administrative
Agent’s Sterling Deposit Account.

 

“Administrative Borrower” has the meaning specified therefor in Section 16.11.

 

“Advances” means the Canadian Advances, European Advances and the US Advances.

 

“Affiliate” means, as applied to any Person, any other Person who controls, is
controlled by, or is under common control with, such Person.  For purposes of
this definition, “control” means the possession, directly or indirectly through
one or more intermediaries, of the power to direct the management and policies
of a Person, whether through the ownership of Stock, by contract, or otherwise;
provided, however, that, for purposes of the definitions of Eligible Accounts,
Eligible Unbilled Accounts, Eligible US Accounts, Eligible Foreign Accounts,
Eligible Unbilled Foreign Accounts, Eligible Unbilled US Accounts and
Section 6.13 hereof: (a) any Person which owns directly or indirectly 10% or
more of the Stock having ordinary voting power for the election of directors or
other members of the governing body of a Person or 10% or more of the
partnership or other ownership interests of a Person (other than as a limited
partner of such Person) shall be deemed an Affiliate of such Person, (b) each
director (or comparable manager) of a Person shall be deemed to be an Affiliate
of such Person, and (c) each partnership or joint venture in which a Person is a
partner or joint venturer shall be deemed an Affiliate of such Person. 
Notwithstanding anything to the contrary in the foregoing sentence, for the
purpose of determining the Affiliates of any Account Debtor of the Parent and
its Subsidiaries as such term is used in the definitions of Eligible Accounts,
Eligible Unbilled Accounts, Eligible US Accounts, Eligible Foreign Accounts,
Eligible Unbilled Foreign Accounts, and Eligible Unbilled US Accounts,
“Affiliate” shall mean, as applied to such Account Debtor, any other Person that
would be part of a group of customers under common control or customers that are
affiliates of each other that would together with such Account Debtor be
considered a “single customer” for purposes of paragraph (c)(vii) of Item 101 of
Regulation S-K of the Exchange Act (or any successor provision) and any other
Person that, to the knowledge of the Loan Parties, would otherwise constitute an
Affiliate of such Account Debtor pursuant to the foregoing sentence.

 

“Agents” means Administrative Agent, Canadian Administrative Agent, European
Administrative Agent and Collateral Agent and “Agent” means any one of them.

 

“Agent-Related Persons” means each Agent, together with its respective
Affiliates, officers, directors, employees, attorneys, and agents.

 

“Agent’s Account” means a Canadian Administrative Agent’s Account, a European
Administrative Agent’s Account or the Administrative Agent’s Account, as
applicable.

 

2

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“Agent’s Liens” means the Liens granted by the Loan Parties to Collateral Agent
for the benefit of the Lender Group and the Bank Product Providers under the
Loan Documents.

 

“Agreement” means the Credit Agreement to which this Schedule 1.1 is attached.

 

“Annual Acquisition Limit” means, initially $5,000,000 and, if at any time after
the second anniversary of the date hereof, as of the then most recent month end
for which financial statements have been delivered to the Administrative Agent
pursuant to Section 5.3, the Leverage Ratio is less than 2.0:1.0 (“Limit
Increase Event”), $8,000,000; provided, that if, after a Limit Increase Event
has occurred, as of the then most recent month end for which financial
statements have been delivered to the Administrative Agent pursuant to
Section 5.3, the Leverage Ratio is equal to or greater than 2.0:1.0, the Annual
Acquisition Limit shall reduce to $5,000,000 until the occurrence of a
subsequent Limit Increase Event.

 

“Applicable Currency” means, with respect to any Obligation, the currency in
which such Obligation is denominated.

 

“Applicable Law” means, in the context that refers to one or more Persons, those
Laws that apply to that Person or Persons or its or their business, undertaking,
property or securities.

 

“Applicable Prepayment Premium” has the meaning specified therefor in the Fee
Letter.

 

“Approved Offshore Currency” means Sterling or Euro.

 

“Approved Offshore Currency Rate” means, for each Interest Period for each
Offshore Currency Rate Loan, the rate per annum, (i) reported by Bloomberg as
established by the British Bankers Association on the date following such
establishment (rounded upwards, if necessary, to the next 1/100%), to be the
rate at which deposits in the Approved Offshore Currency (for delivery on the
first day of the requested Interest Period) are offered to major banks in the
London interbank market 2 Business Days prior to the commencement of the
requested Interest Period, or (ii) if the Bloomberg rate is unavailable, as
determined by European Administrative Agent using a commercially available
source in accordance with its customary procedures, and utilizing such
electronic or other quotation sources as it considers appropriate, for a term
and in an amount comparable to the Interest Period and the amount of the
Offshore Currency Rate Loan requested (whether as an initial Offshore Currency
Rate Loan or as a continuation of an Offshore Currency Rate Loan or as a
conversion of a Base Rate Loan to an Offshore Currency Rate Loan) by
Administrative Borrower in accordance with this Agreement, which determination
shall be conclusive in the absence of manifest error.

 

“Approved Offshore Rate Loan” means each portion of an Advance that bears
interest at a rate determined by reference to the Approved Offshore Currency
Rate.

 

3

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“Assignee” has the meaning specified therefor in Section 13.1(a).

 

“Assignment and Acceptance” means an Assignment and Acceptance Agreement
substantially in the form of Exhibit A-1.

 

“Authorized Person” means any officer or employee of Administrative Borrower.

 

“Auditors’ Determination” has the meaning specified therefor in Section 2.15(j).

 

“Availability” means, as of any date of determination, the aggregate amount that
Borrowers are entitled to borrow as Advances hereunder (after giving effect to
the Dollar Equivalent of the principal amount of all then outstanding
Obligations (other than Bank Product Obligations) and all sublimits and reserves
then applicable hereunder).

 

“Availability Reserve” means an amount equal to (x) at any time prior to the
repayment in full of all Indebtedness under the Indenture, $30,000,000 and
(y) at any time after the repayment in full of all Indebtedness under the
Indenture, $0.

 

“Bank Product” means any financial accommodation extended to any Loan Party or
any Significant Subsidiary by a Bank Product Provider (other than pursuant to
the Loan Documents other than the Bank Product Agreements) including: 
(a) credit cards, (b) credit card processing services, (c) debit cards,
(d) purchase cards, (e) ACH Transactions, (f) cash management, including
controlled disbursement, accounts or services, or (g) transactions under Hedge
Agreements.

 

“Bank Product Agreements” means those agreements entered into from time to time
by any Loan Party or any Significant Subsidiary with a Bank Product Provider in
connection with the obtaining of any of the Bank Products.

 

“Bank Product Obligations” means all obligations, liabilities, contingent
reimbursement obligations, fees, and expenses owing by Loan Parties or the
Significant Subsidiaries to any Bank Product Provider pursuant to or evidenced
by the Bank Product Agreements and irrespective of whether for the payment of
money, whether direct or indirect, absolute or contingent, due or to become due,
now existing or hereafter arising, and including all such amounts that Loan
Parties or the Significant Subsidiaries are obligated to reimburse to any Agent
or any member of the Lender Group as a result of such Agent or such member of
the Lender Group purchasing participations from, or executing indemnities or
reimbursement obligations to, a Bank Product Provider with respect to the Bank
Products provided by such Bank Product Provider to Loan Parties or the
Significant Subsidiaries.

 

“Bank Product Provider” means Wells Fargo or any of its Affiliates.

 

“Bank Product Reserve” means, as of any date of determination, the lesser of
(a) $5,000,000 less the amount of the Foreign Bank Product Reserve, if any, and
(b) the amount of reserves that Administrative Agent has established (based upon
the Bank Product

 

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Providers’ reasonable determination of the credit exposure of US Loan Parties in
respect of Bank Products) in respect of Bank Products then provided or
outstanding; provided, that in order to qualify as Bank Product Reserves such
reserves must be established on or prior to the time that the Bank Product
Provider first provides the applicable Bank Product.

 

“Bankruptcy Code” means (i) title 11 of the United States Code, (ii) the
Bankruptcy and Insolvency Act (Canada), (iii) the Companies’ Creditors
Arrangement Act (Canada), or (iv) any similar legislation in a relevant
jurisdiction, in each case as applicable and as in effect from time to time.

 

“Base LIBOR Rate” means the rate per annum (i) reported by Bloomberg as
established by the British Bankers Association on the date following such rate
being established (rounded upwards, if necessary, to the next 1/100%), to be the
rate at which Dollar deposits (for delivery on the first day of the requested
Interest Period) are offered to major banks in the London interbank market 2
Business Days prior to the commencement of the requested Interest Period, or
(ii) if the Bloomberg rate is unavailable, as determined by Administrative Agent
using a commercially available source in accordance with its customary
procedures, and utilizing such electronic or other quotation sources as it
considers appropriate, for a term and in an amount comparable to the Interest
Period and the amount of the LIBOR Rate Loan requested (whether as an initial
LIBOR Rate Loan or as a continuation of a LIBOR Rate Loan or as a conversion of
a Base Rate Loan to a LIBOR Rate Loan) by Administrative Borrower in accordance
with this Agreement, which determination shall be conclusive in the absence of
manifest error.

 

“Base Rate” means, as applicable, the US Base Rate or the Canadian Base Rate.

 

“Base Rate Loan” means each portion of an Advance or the Term Loan A that bears
interest at a rate determined by reference to the Base Rate.

 

“Base Rate Margin” means 0.25%; provided that, at any time that the outstanding
principal balance of the Term Loan A has been paid in full, the Base Rate Margin
shall be minus 0.50%.

 

“Base Rate Term Loan A Margin” means 0.25%.

 

“Benefit Plan” means a “defined benefit plan” (as defined in Section 3(35) of
ERISA or a benefit plan under Canadian Employee Benefits Legislation) for which
Borrower or any Subsidiary or ERISA Affiliate of Borrower has been an “employer”
(as defined in Section 3(5) of ERISA or has held equivalent status under
Canadian Employee Benefits Legislation) within the past six years.

 

“Board of Directors” means, with respect to any Person, the board of directors
(or comparable managers) of such Person or any committee thereof duly authorized
to act on behalf of the board of directors (or comparable managers).

 

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“Borrower” and “Borrowers” have the respective meanings specified therefor in
the preamble to the Agreement.

 

“Borrowing” means a borrowing hereunder consisting of Advances (or Term Loan A,
as applicable) made on the same day by the Lenders (or Administrative Agent,
Canadian Administrative Agent or European Administrative Agent on behalf
thereof), or by a Swing Lender in the case of a Swing Loan, or by Administrative
Agent, Canadian Administrative Agent or European Administrative Agent in the
case of a Protective Advance, in each case, to Administrative Borrower, Canadian
Administrative Borrower or European Administrative Borrower, as applicable.

 

“Business Day” means any day that is not a Saturday, Sunday, or other day on
which banks are authorized or required to close in the states of New York or
California or, with respect to the obligations of a Foreign Borrower, are
authorized or required to close in Ireland, United Kingdom, Germany or Canada,
as applicable, provided that, (a) if a determination of a Business Day shall
relate to a LIBOR Rate Loan denominated in Dollars, the term “Business Day” also
shall exclude any day on which banks are closed for dealings in Dollar deposits
or Approved Offshore Currency deposits in the London interbank market, (b) if a
determination of a Business Day shall relate to a Loan or a Letter of Credit
denominated in Canadian Dollars, the term “Business Day” also shall exclude any
day on which banks are closed for dealings in Canadian Dollar deposits in the
London interbank market, and (c) if a determination of a Business Day shall
relate to a Loan or a Letter of Credit denominated in an Approved Offshore
Currency, the term “Business Day” shall also exclude any day on which banks are
not open for dealings in deposits in the applicable Approved Offshore Currency
in the London interbank market.

 

“Canadian Administrative Agent” has the meaning specified therefor in the
preamble to the Agreement.

 

“Canadian Administrative Agent’s Account” means, with respect to Dollars, the
Deposit Account of Canadian Administrative Agent identified on Schedule A-2 as
the Canadian Administrative Agent’s Dollar Deposit Account and, with respect to
Canadian Dollars, the Deposit Account of Canadian Administrative Agent
identified on Schedule A-2 as the Canadian Administrative Agent’s Canadian
Dollar Deposit Account.

 

“Canadian Administrative Borrower” means SITEL Teleservices Canada Inc.

 

“Canadian Advances” has the meaning specified therefor in Section 2.1(a).

 

“Canadian Availability” means, as of any date of determination, the amount that
Canadian Borrowers are entitled to borrow as Canadian Advances hereunder (after
giving effect to all then outstanding Canadian Revolver Usage and all sublimits
and reserves then applicable hereunder).

 

“Canadian Base Rate” means, the rate of interest announced, from time to time,
within Canadian Imperial Bank of Commerce in Toronto, Canada as its “prime
rate”,

 

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with the understanding that the “prime rate” is one of such bank’s base rates
(not necessarily the lowest of such rates) and serves as the basis upon which
effective rates of interest are calculated for those Canadian Dollar loans
making reference thereto and is evidenced by the recording thereof after its
announcement in such internal publication or publications as such bank may
designate.

 

“Canadian Borrowers” means SITEL Teleservices Canada Inc., SITEL Insurance
Services Canada Inc., and SITEL Customer Care, Inc. and each other Subsidiary of
Parent created or organized under the laws of Canada or any province thereof
that becomes a Borrower hereunder pursuant to Section 5.15, and “Canadian
Borrower” means any one of them.

 

“Canadian Borrowing” means a Borrowing hereunder consisting of Canadian Advances
made on the same day by the Lenders (or Canadian Administrative Agent on behalf
thereof), or by the Canadian Swing Lender in the case of a Canadian Swing Loan,
or by Canadian Administrative Agent in the case of a Protective Advance, in each
case, to any Canadian Borrower.

 

“Canadian Borrowing Base” means, as of any date of determination, the Foreign
Borrowing Base less European Revolver Usage.

 

“Canadian Designated Account” means, with respect to Dollars, the applicable
Deposit Account of Canadian Administrative Borrower identified on Schedule D-1
as the Canadian Designated Account for Dollars and, with respect to Canadian
Dollars, the applicable Deposit Account of Canadian Administrative Borrower
identified on Schedule D-1 as the Canadian Designated Account for Canadian
Dollars or, in each case, such other account as Canadian Administrative Borrower
may specify by notice to Canadian Administrative Agent.

 

“Canadian Designated Account Bank” has the meaning specified therefor in
Schedule D-1 or such other bank as Canadian Administrative Borrower may specify
by notice to Canadian Administrative Agent.

 

“Canadian Dollar” means the lawful currency of Canada.

 

“Canadian Employee Benefits Legislation” means the Canadian Pension Plan Act
(Canada), the Canadian Income Tax Act, the Pension Benefits Standards Act 1985
(Canada), the Employment Insurance Act (Canada), the Pension Benefits Act
(Ontario), the Health Insurance Act (Ontario), the Employment Standards Act 2000
(Ontario), the Workplace Safety and Insurance Act 1997 (Ontario), the
Occupational Health and Safety Act (Ontario) and any federal, provincial or
local counterparts or equivalents, in each case, as applicable and as amended
from time to time.

 

“Canadian Income Tax Act” means the Income Tax Act (Canada), R.S.C. 1985 C.1
(5th Supp.), as amended from time to time.

 

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“Canadian Issuing Lender” means Wells Fargo Financial Corporation Canada or any
other Lender that, at the request of Administrative Borrower and with the
consent of Canadian Administrative Agent, agrees, in such Lender’s sole
discretion, to become an Issuing Lender for the purpose of issuing Canadian L/Cs
or Canadian L/C Undertakings pursuant to Section 2.12.

 

“Canadian L/C” has the meaning specified therefor in Section 2.12(b).

 

“Canadian L/C Disbursement” means a payment made by the Canadian Issuing Lender
pursuant to a Canadian Letter of Credit.

 

“Canadian L/C Undertaking” has the meaning specified therefor in
Section 2.12(b)(i).

 

“Canadian Lender” means a Lender that has an interest in the Canadian Revolver
Commitment and/or the Canadian Revolver Usage.

 

“Canadian Letter of Credit” means a Canadian L/C or a Canadian L/C Undertaking,
as the context requires.

 

“Canadian Letter of Credit Usage” means, as of any date of determination, the
Dollar Equivalent of the aggregate undrawn amount of all outstanding Canadian
Letters of Credit.

 

“Canadian LIBOR Rate” means, for each Interest Period for each Canadian LIBOR
Rate Loan, the rate per annum (i) reported by Bloomberg as established by the
British Bankers Association on the date following such establishment (rounded
upwards, if necessary, to the next 1/100%), to be the rate at which Canadian
Dollar deposits (for delivery on the first day of the requested Interest Period)
are offered to major banks in the London interbank market 2 Business Days prior
to the commencement of the requested Interest Period, or (ii) if the Bloomberg
rate is unavailable, as determined by Canadian Administrative Agent using a
commercially available source in accordance with its customary procedures, and
utilizing such electronic or other quotation sources as it considers
appropriate, for a term and in an amount comparable to the Interest Period and
the amount of the LIBOR Rate Loan requested (whether as an initial LIBOR Rate
Loan or as a continuation of a LIBOR Rate Loan or as a conversion of a Base Rate
Loan to a LIBOR Rate Loan) by Administrative Borrower in accordance with this
Agreement, which determination shall be conclusive in the absence of manifest
error.

 

“Canadian Loan Account” has the meaning specified therefor in Section 2.10.

 

“Canadian Protective Advances” has the meaning specified therefor in
Section 2.3(d)(ii).

 

“Canadian Revolver Commitment” means, with respect to each Lender, its Canadian
Revolver Commitment, and, with respect to all Lenders, their Canadian Revolver
Commitments, in each case as such Dollar amounts are set forth beside such
Lender’s name

 

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under the applicable heading on Schedule C-1 or in the Assignment and Acceptance
pursuant to which such Lender became a Lender hereunder, as such amounts may be
reduced or increased from time to time pursuant to assignments made in
accordance with the provisions of Section 13.1.

 

“Canadian Revolver Usage” means, as of any date of determination, the sum of
(a) the Dollar Equivalent of the principal amount of outstanding Canadian
Advances, plus (b) the amount of the Canadian Letter of Credit Usage, in each
case as determined as of such date.

 

“Canadian Risk Participation Liability” means, as to each Canadian Letter of
Credit, all reimbursement obligations of Canadian Borrowers to the Canadian
Issuing Lender with respect to a Canadian L/C Undertaking, consisting of (a) the
amount available to be drawn or which may become available to be drawn, (b) all
amounts that have been paid by the Canadian Issuing Lender to the Canadian
Underlying Issuer to the extent not reimbursed by Canadian Borrowers, whether by
the making of a Canadian Advance or otherwise, and (c) all accrued and unpaid
interest, fees, and expenses payable with respect thereto.

 

“Canadian Swing Lender” means Wells Fargo Financial Corporation Canada or any
other Lender that, at the request of Administrative Borrower and with the
consent of Canadian Administrative Agent agrees, in such Lender’s sole
discretion, to become the Canadian Swing Lender under Section 2.3(b).

 

“Canadian Swing Loan” has the meaning specified therefor in Section 2.3(b)(ii).

 

“Canadian Underlying Issuer” means a third Person which is the beneficiary of a
Canadian L/C Undertaking and which has issued a letter of credit at the request
of the Canadian Issuing Lender for the benefit of one or more of the Canadian
Borrowers.

 

“Canadian Underlying Letter of Credit” means a letter of credit that has been
issued by a Canadian Underlying Issuer.

 

“Capital Expenditures” means, with respect to any Person for any period, the
aggregate of (a) all expenditures by such Person and its Subsidiaries during
such period that are capital expenditures as determined in accordance with GAAP,
whether such expenditures are paid in cash or financed but excluding
expenditures in respect of reinvestments of casualty proceeds and proceeds of
asset dispositions and Extraordinary Receipts permitted pursuant to
Section 2.4(d) (in all cases other than with respect to the definition of
“Permitted Investments”, excluding any such Capital Expenditures that have been
funded by customers of Parent and its Subsidiaries to the extent Parent and its
Subsidiaries have received cash in respect thereof from such customers), and
(b) to the extent not covered by clause (a) of this definition, any Investments
made in reliance on clause (r) of the definition of “Permitted Investments”.

 

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“Capitalized Lease Obligation” means that portion of the obligations under a
Capital Lease that is required to be capitalized in accordance with GAAP.

 

“Capital Lease” means a lease that is required to be capitalized for financial
reporting purposes in accordance with GAAP.

 

“Cash Equivalents” means (a) marketable direct obligations issued by, or
unconditionally guaranteed by, the United States or issued by any agency thereof
and backed by the full faith and credit of the United States, in each case
maturing within 1 year from the date of acquisition thereof, (b) marketable
direct obligations issued by any state of the United States or any political
subdivision of any such state or any public instrumentality thereof maturing
within 1 year from the date of acquisition thereof and, at the time of
acquisition, having one of the two highest ratings obtainable from either
Standard & Poor’s Rating Group (“S&P”) or Moody’s Investors Service, Inc.
(“Moody’s”), (c) commercial paper maturing no more than 270 days from the date
of creation thereof and, at the time of acquisition, having a rating of at least
A-1 from S&P or at least P-1 from Moody’s, (d) certificates of deposit, time
deposits or bankers’ acceptances maturing within 1 year from the date of
acquisition thereof issued by any bank organized under the laws of the United
States or any state thereof or the District of Columbia having at the date of
acquisition thereof combined capital and surplus of not less than $250,000,000,
(e) Deposit Accounts maintained with (i) any bank that satisfies the criteria
described in clause (d) above, or (ii) any other bank organized under the laws
of the United States or any state thereof or the District of Columbia so long as
the amount maintained with any such other bank is less than or equal to $100,000
and is insured by the Federal Deposit Insurance Corporation, (f) Investments in
money market funds substantially all of whose assets are invested in the types
of assets described in clauses (a) through (e) above and (g) in the case of any
Foreign Loan Party or any Significant Subsidiary, other investments made in
investments of a type analogous to the foregoing in accordance with normal
investment practices for cash management.

 

“Cash Management Account” has the meaning specified therefor in Section 2.7(a).

 

“Cash Management Agreements” means those certain cash management agreements, in
form and substance reasonably satisfactory to Collateral Agent, each of which is
among Administrative Borrower or one of its Subsidiaries, Collateral Agent, Term
B Agent (to the extent the Term B Debt is outstanding on the date of such Cash
Management Agreement and such Cash Management Agreement relates to a US Loan
Party’s Cash Management Account), and one of the Cash Management Banks.

 

“Cash Management Bank” has the meaning specified therefor in Section 2.7(a).

 

“Cash Management Reinstatement Event” means January 1 or July 1 of any fiscal
year after the occurrence of a Cash Management Triggering Event if on such date
no Event of Default exists and the Borrowers have maintained daily average
Dollar Equivalent

 

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of Excess Availability for the immediately preceding 60 consecutive day period
of at least $15,000,000.

 

“Cash Management Triggering Event” means the occurrence of an Event of Default
or the failure of the Borrowers to maintain daily average Dollar Equivalent of
Excess Availability for a 30 consecutive day period of at least $15,000,000.

 

“Change of Control” means that (a) any “person” or “group” (within the meaning
of Sections 13(d) and 14(d) of the Exchange Act), other than Permitted Holders,
becomes the beneficial owner (as defined in Rule 13d-3 under the Exchange Act),
directly or indirectly, of Stock representing more than 50% of the aggregate
ordinary voting power represented by the issued and outstanding capital stock of
Parent, or (b) individuals who, at the beginning of any period of 24 consecutive
months, constitute the Parent’s board of directors (together with any new
director whose election by the Parent’s board of directors or whose nomination
for election by the Parent’s stockholders was approved by a vote of at least a
majority of the directors then still in office who either were directors at the
beginning of such period or whose election or nomination for election was
previously so approved) cease for any reason (other than death or disability) to
constitute a majority of the Parent’s board of directors then in office or
(c) any “person” or “group” (within the meaning of the Exchange Act) other than
the Permitted Holders shall own or control directly or indirectly that
percentage of the outstanding Stock of Parent necessary to elect a majority of
the board of directors (or similar governing body) of Parent or (d) Parent or
any Loan Party fails to own and control directly or indirectly, 100% of the
outstanding Stock of each of their respective Subsidiaries that are Loan Parties
or Significant Subsidiaries (other than SITEL Insurance Services Canada Inc.)
extant as of the Closing Date other than nominee shares and director’s
qualifying shares required by law, except in connection with a transaction
expressly permitted under Section 6.3, the Pre-approved Asset Disposition Letter
or, with respect to any Subsidiary that is not a Loan Party, Section 6.4 or
(e) Parent or any Loan Party fails to own directly or indirectly, at least 49%
of the outstanding Stock of SITEL Insurance Services Canada Inc. and either have
the option to purchase the remaining Stock of SITEL Insurance Services Canada
Inc. for nominal consideration or own directly or indirectly the remaining Stock
of SITEL Insurance Services Canada Inc., except in connection with a transaction
expressly permitted under Section 6.3.

 

“Closing Date” means the earlier of (x) the date of the making of the initial
Advance (or other extension of credit) hereunder and (y) the date that the
conditions in Section 3.1 are either satisfied or waived in accordance with the
terms thereof.

 

“Closing Date Projections” means the Projections for fiscal year 2005 delivered
on or prior to the Closing Date.

 

“Code” means the New York Uniform Commercial Code, as in effect from time to
time.

 

“Collateral” means the US Collateral and the Foreign Collateral.

 

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“Collateral Access Agreement” means a landlord waiver, bailee letter, or
acknowledgement agreement of any lessor, warehouseman, processor, consignee, or
other Person in possession of, having a Lien upon, or having rights or interests
in Administrative Borrower’s or its Subsidiaries’ books and records, in each
case, in form and substance reasonably satisfactory to Collateral Agent.

 

“Collateral Agent” has the meaning specified therefor in the preamble to the
Agreement.

 

“Collections” means all cash, checks, notes, instruments, and other items of
payment (including insurance proceeds, proceeds of cash sales, rental proceeds,
and tax refunds).

 

“Commitment” means, with respect to each Lender, its Revolver Commitment, its
Term Loan A Commitment, or its Total Commitment, as the context requires, and,
with respect to all Lenders, their Revolver Commitments, their Term Loan A
Commitments, or their Total Commitments, as the context requires, in each case
as such Dollar amounts are set forth beside such Lender’s name under the
applicable heading on Schedule C-1 or in the Assignment and Acceptance pursuant
to which such Lender became a Lender hereunder, as such amounts may be reduced
or increased from time to time pursuant to assignments made in accordance with
the provisions of Section 13.1.

 

“Compliance Certificate” means a certificate substantially in the form of
Exhibit C-1 delivered by the chief financial officer, controller, treasurer or
vice president of finance of Parent to Administrative Agent.

 

“Control Agreement” means a control agreement, in form and substance reasonably
satisfactory to Collateral Agent, executed and delivered by a Loan Party,
Collateral Agent, Term B Agent (to the extent the Term B Debt is outstanding on
the date of such Control Agreement), and the applicable securities intermediary
(with respect to a Securities Account) or bank (with respect to a Deposit
Account).

 

“Convertible Note Offering” means an offering by Parent of convertible debt
securities in an aggregate initial principal amount not to exceed $70,000,000
that (i) has a maturity date on or after February 19, 2011, (ii) does not
require any cash payments of principal or interest prior to February 19, 2011,
(iii) has terms or conditions that, taken as a whole, are not more burdensome or
restrictive to the Loan Parties than the Loan Documents and (iv) is unsecured,
and any refinancing thereof that meets the criteria set forth in clauses
(i) through (iv) of this definition.

 

“Covenant Event” means the occurrence of any of the following events at any time
after the Covenant Suspension Date:

 

(i)                                     a Default or Event of Default shall have
occurred and be continuing; or

 

(ii)                                  (x) for purposes of Sections 6.17(a) and
6.17(b)(ii)(A), the failure of Borrowers to maintain average daily Dollar
Equivalent of Excess Availability for any Fiscal

 

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Month of at least $20,000,000 and (y) for purposes of Section 6.17(b)(ii)(B) for
the 30 day period ending on the day preceding the date on which the proposed
transaction or event is to be consummated or incurred, the failure of Borrowers
to maintain average daily Dollar Equivalent of Excess Availability of at least
$20,000,000.

 

“Covenant Suspension Date” means the first date on which the Term Loan A and the
Term B Debt have been paid in full and the following conditions have been
satisfied:

 

(i)                                     no Default or Event of Default shall
have occurred and be continuing; and

 

(ii)                                  for the 30 day period ending on such date,
the Borrowers have maintained average daily Dollar Equivalent of Excess
Availability of not less than $20,000,000.

 

“Currency Due” has the meaning specified therefor in Section 10.4.

 

“Currency Exchange Rate” means, with respect to a currency, the rate quoted by
the Reference Bank as the spot rate for the purchase by the Reference Bank of
such currency with another currency at approximately 10:30 a.m. (New York time)
on the date two (2) Business Days prior to the date as of which the foreign
exchange computation is made.

 

“Daily Balance” means, as of any date of determination and with respect to any
Obligation, the amount of such Obligation owed at the end of such day.

 

“Default” means an event, condition, or default that, with the giving of notice,
the passage of time, or both, would, unless cured or waived, be an Event of
Default.

 

“Defaulting Lender” means any Lender that fails to make any Advance (or other
extension of credit) that it is required to make hereunder on the date that it
is required to do so hereunder or fails to pay any amount that it is required to
pay pursuant to Section 2.17(c) on the date that it is required to do so
hereunder.

 

“Defaulting Lender Rate” means (a) for the first 3 days from and after the date
the relevant payment is due, with respect to amounts denominated in Dollars, the
US Base Rate, with respect to amounts denominated in Canadian Dollars, the
Canadian Base Rate, and with respect to amounts denominated in an Approved
Offshore Currency, the applicable Approved Offshore Currency Rate with respect
to LIBOR Rate Loans with an Interest Period of one month’s duration and
(b) thereafter, with respect to amounts denominated in Dollars, the interest
rate then applicable to Advances that are Base Rate Loans denominated in Dollars
(inclusive of the Base Rate Margin applicable thereto), with respect to amounts
denominated in Canadian Dollars, the interest rate then applicable to Advances
that are Base Rate Loans denominated in Canadian Dollars (inclusive of the Base
Rate Margin applicable thereto) and, with respect to amounts denominated in an
Approved Offshore Currency, the interest rate then applicable to Advances that
are LIBOR Rate Loans denominated in such

 

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Approved Offshore Currency with an Interest Period of one month’s duration
(inclusive of the LIBOR Rate Margin applicable thereto).

 

“Deposit Account” means any deposit account (as that term is defined in the
Code).

 

“Disbursement Letter” means an instructional letter executed and delivered by
the Administrative Borrower to the Administrative Agent, Canadian Administrative
Agent and European Administrative Agent regarding the extensions of credit to be
made on the Closing Date, the form and substance of which is reasonably
satisfactory to the Administrative Agent, Canadian Administrative Agent and
European Administrative Agent.

 

“Dollar Equivalent” means, at any time, (a) as to any amount denominated in
Dollars, the amount thereof at such time, and (b) as to any amount denominated
in a currency other than Dollars, the equivalent amount in Dollars as determined
by Administrative Agent at such time on the basis of the Currency Exchange Rate
for the purchase of Dollars with such currency.

 

“Dollars” or “$” means United States dollars.

 

“EBITDA” means, with respect to any fiscal period, Parent’s and its
Subsidiaries’ consolidated net income (or loss), minus to the extent not
included in determining net income (or loss) for such period, cash expenditures
during such period in respect of the acceleration of lease expense for
facilities that have been, or are intended to be, closed, minus, to the extent
included in the calculation of net income (or loss), extraordinary gains and
interest income, and plus, to the extent deducted in determining net income (or
loss), non-cash losses on sales of assets outside of the ordinary course of
business, write-downs or non-cash losses on dispositions of fixed assets and
intangible assets (including goodwill write-downs as required under FAS
pronouncement 142), non-cash charges in respect of the acceleration of lease
expense for facilities that have been, or are intended to be, closed, interest
expense, amortization or write-off of debt discount and debt issuance costs and
commissions, discounts and other fees and charges associated with Indebtedness,
income tax expense, depreciation and amortization expense, amortization of
intangibles (including, without limitation, goodwill) and organization costs,
cash restructuring and severance charges incurred and paid during the fiscal
year ending December 31, 2005 in an aggregate amount not to exceed $5,500,000
and reflected on the financial Projections for fiscal year 2005, delivered to
Administrative Agent and in form and substance satisfactory to Administrative
Agent, cash restructuring charges expensed during the fiscal year ending
December 31, 2004 in an aggregate amount not to exceed $8,000,000, and any other
non-cash charges (including, without limitation, the amount of any non-cash
deduction to consolidated net income (or loss) as a result of any grant to
members of management of any capital stock of Parent), in each case, for such
period as determined in accordance with GAAP.

 

“Eligible Accounts” means Eligible Foreign Accounts and Eligible US Accounts.

 

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“Eligible Foreign Accounts” means those Accounts created by a Foreign Borrower
in the ordinary course of its business, that arise out of its sale of goods or
rendition of services, that comply with each of the representations and
warranties respecting Eligible Foreign Accounts made in the Loan Documents, and
that are not excluded as ineligible by virtue of one or more of the excluding
criteria set forth below; provided, however, that such criteria may be revised
from time to time by Administrative Agent in Administrative Agent’s Permitted
Discretion to address the results of any audit performed by Administrative Agent
from time to time after the Closing Date.  In determining the amount to be
included, Eligible Foreign Accounts shall be calculated net of customer deposits
and unapplied cash.  Eligible Foreign Accounts shall not include the following:

 

(A)                                  (I) ACCOUNTS WITH SELLING TERMS OF MORE
THAN 90 DAYS OR (II) WITH RESPECT TO ACCOUNTS WITH SELLING TERMS OF NOT MORE
THAN 30 DAYS, THE ACCOUNT DEBTOR HAS FAILED TO PAY WITHIN 90 DAYS OF ORIGINAL
INVOICE DATE OR 60 DAYS OF THE DUE DATE AND, WITH RESPECT TO ACCOUNTS WITH
SELLING TERMS OF MORE THAN 30 DAYS, THE ACCOUNT DEBTOR HAS FAILED TO PAY WITHIN
30 DAYS OF THE DUE DATE,

 

(b)                                 Accounts owed by an Account Debtor (or its
Affiliates) where 50% or more of all Accounts owed by that Account Debtor (or
its Affiliates) are deemed ineligible under clause (a) above,

 

(c)                                  Accounts with respect to which the Account
Debtor is an Affiliate of any Foreign Borrower or an employee or agent of any
Foreign Borrower or any Affiliate of any Foreign Borrower,

 

(d)                                 Accounts arising in a transaction wherein
goods are placed on consignment or are sold pursuant to a guaranteed sale, a
sale or return, a sale on approval, a bill and hold, or any other terms by
reason of which the payment by the Account Debtor may be conditional,

 

(e)                                  Accounts that are not payable in Dollars,
Canadian Dollars or an Approved Offshore Currency,

 

(f)                                    Accounts with respect to which the
Account Debtor either (i) with respect to Accounts of a Canadian Borrower, does
not maintain its chief executive office, or other office acceptable to
Administrative Agent in its Permitted Discretion, in the United States or
Canada, with respect to Accounts of a UK Borrower, does not maintain its chief
executive office, or other office acceptable to Administrative Agent in its
Permitted Discretion, in the United Kingdom, with respect to Accounts of an
Irish Borrower, does not maintain its chief executive office, or other office
acceptable to Administrative Agent in its Permitted Discretion, in Ireland or in
the United Kingdom, or with respect to Accounts of a German Borrower, does not
maintain its chief executive office, or other office acceptable to
Administrative Agent in its Permitted Discretion, in Germany, or (ii) is not
organized under the laws of the United States, Ireland, United Kingdom, Canada
or Germany or any state or province or political subdivision thereof or the
District of Columbia, or (iii) is the government of any country or sovereign
state other than the United States, or of any state,

 

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province, municipality, or other political subdivision thereof, or of any
department, agency, public corporation, or other instrumentality thereof,
unless, in each case (y) the Account is supported by an irrevocable letter of
credit satisfactory to Administrative Agent in its Permitted Discretion (as to
form, substance, and issuer or domestic confirming bank) that has been delivered
to Collateral Agent and is directly drawable by Collateral Agent, or (z) the
Account is covered by credit insurance in form, substance, and amount, and by an
insurer, satisfactory to Administrative Agent in its Permitted Discretion,

 

(g)                                 Accounts with respect to which the Account
Debtor is either (i) the United States or any department, agency, or
instrumentality of the United States (exclusive, however, of Accounts with
respect to which the applicable Borrower has complied, to the reasonable
satisfaction of Administrative Agent, with the Assignment of Claims Act, 31 USC
§ 3727), or (ii) any state of the United States,

 

(h)                                 Accounts with respect to which the Account
Debtor is also a creditor of any Borrower and has or has asserted a right of
setoff, or has disputed its obligation to pay all or any portion of the Account,
to the extent of such claim, right of setoff, or dispute,

 

(i)                                     Accounts with respect to an Account
Debtor whose total obligations owing to Borrowers exceed 10% (such percentage,
as applied to a particular Account Debtor, being subject to reduction by
Administrative Agent in its Permitted Discretion if the creditworthiness of such
Account Debtor deteriorates) of all Eligible Accounts (except with respect to
(x) General Motors Corporation and its Affiliates, in which case the total
obligations of such Account Debtor shall not exceed 30% (such percentage being
subject to reduction by Administrative Agent in its Permitted Discretion if the
creditworthiness of such Account Debtor materially deteriorates) of all Eligible
Accounts and (y) the Specified Account Debtors and any other Account Debtor
designated by Administrative Agent in its Permitted Discretion, in which case
the total obligations of such Account Debtor shall not exceed 15% (such
percentage being subject to reduction by Administrative Agent in its Permitted
Discretion if the creditworthiness of such Account Debtor materially
deteriorates) of all Eligible Accounts), to the extent of the obligations owing
by such Account Debtor in excess of such percentage; provided, however, that, in
each case, the amount of Eligible Accounts that are excluded because they exceed
the foregoing percentage shall be determined by Administrative Agent based on
all of the otherwise Eligible Accounts prior to giving effect to any
eliminations based upon the foregoing concentration limit,

 

(j)                                     Accounts with respect to which the
Account Debtor is subject to an Insolvency Proceeding, to the knowledge of the
Loan Parties is not Solvent, has gone out of business, or as to which a Borrower
has received notice of an imminent Insolvency Proceeding or a material
impairment of the financial condition of such Account Debtor,

 

(k)                                  Accounts with respect to which the Account
Debtor is located in a state or jurisdiction (e.g., New Jersey, Minnesota, and
West Virginia) that requires, as a condition to access to the courts of such
jurisdiction, that a creditor qualify to transact business, file a business
activities report or other report or form, or take one or more other actions,
unless the applicable Borrower has so qualified, filed such reports or forms, or
taken such actions (and,

 

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in each case, paid any required fees or other charges), except to the extent
that the applicable Borrower may qualify subsequently as a foreign entity
authorized to transact business in such state or jurisdiction and gain access to
such courts, without incurring any cost or penalty viewed by Administrative
Agent to be significant in amount, and such later qualification cures any access
to such courts to enforce payment of such Account,

 

(l)                                     Accounts, the collection of which,
Administrative Agent, in its Permitted Discretion, believes to be doubtful by
reason of the Account Debtor’s financial condition,

 

(m)                               Accounts that are not subject to a valid and
perfected first priority Agent’s Lien,

 

(n)                                 Accounts with respect to which (i) the goods
giving rise to such Account have not been shipped and billed to the Account
Debtor, or (ii) the services giving rise to such Account have not been performed
and billed to the Account Debtor, or

 

(o)                                 Accounts that represent the right to receive
progress payments or other advance billings that are due prior to the completion
of performance by the applicable Borrower of the subject contract for goods or
services.

 

“Eligible Transferee” means (a) a commercial bank organized under the laws of
the United States, or any state thereof or the District of Columbia, and having
total assets in excess of $250,000,000, (b) a commercial bank organized under
the laws of any other country which is a member of the Organization for Economic
Cooperation and Development or a political subdivision of any such country and
which has a Dollar Equivalent amount of total assets in excess of $250,000,000,
provided that such bank is acting through a branch or agency located in the
United States, (c) a finance company, insurance company, or other financial
institution or fund that is engaged in making, purchasing, or otherwise
investing in commercial loans in the ordinary course of its business and having
(together with its Affiliates) a Dollar Equivalent amount of total assets
(including assets under management) in excess of $250,000,000, (d) any Lender or
any Affiliate (other than individuals) of any Lender, and (e) any other Person
approved by Administrative Agent.

 

“Eligible Unbilled Accounts” means Eligible Unbilled Foreign Accounts and
Eligible Unbilled US Accounts.

 

“Eligible Unbilled Foreign Accounts” means those Accounts created by a Foreign
Borrower in the ordinary course of its business, that arise out of its sale of
goods or rendition of services, that fail to constitute Eligible Foreign
Accounts solely as a result of (i) the goods giving rise to such Account not
having been billed to the Account Debtor, or (ii) the services giving rise to
such Account not having been billed to the Account Debtor.

 

“Eligible Unbilled US Accounts” means those Accounts created by a US Borrower in
the ordinary course of its business, that arise out of its sale of goods or
rendition of services, that fail to constitute Eligible US Accounts solely as a
result of (i) the goods

 

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giving rise to such Account not having been billed to the Account Debtor, or
(ii) the services giving rise to such Account not having been billed to the
Account Debtor.

 

“Eligible US Accounts” means those Accounts created by a US Borrower in the
ordinary course of its business, that arise out of its sale of goods or
rendition of services, that comply with each of the representations and
warranties respecting Eligible US Accounts made in the Loan Documents, and that
are not excluded as ineligible by virtue of one or more of the excluding
criteria set forth below; provided, however, that such criteria may be revised
from time to time by Administrative Agent in Administrative Agent’s Permitted
Discretion to address the results of any audit performed by Administrative Agent
from time to time after the Closing Date.  In determining the amount to be
included, Eligible US Accounts shall be calculated net of customer deposits and
unapplied cash.  Eligible US Accounts shall not include the following:

 

(a)                                  (i) Accounts with selling terms of more
than 90 days or (ii) with respect to Accounts with selling terms of not more
than 30 days, the Account Debtor has failed to pay within 90 days of original
invoice date or 60 days of the due date and, with respect to Accounts with
selling terms of more than 30 days, the Account Debtor has failed to pay within
30 days of the due date,

 

(b)                                 Accounts owed by an Account Debtor (or its
Affiliates) where 50% or more of all Accounts owed by that Account Debtor (or
its Affiliates) are deemed ineligible under clause (a) above,

 

(c)                                  Accounts with respect to which the Account
Debtor is an Affiliate of any US Borrower or an employee or agent of any US
Borrower or any Affiliate of any US Borrower,

 

(d)                                 Accounts arising in a transaction wherein
goods are placed on consignment or are sold pursuant to a guaranteed sale, a
sale or return, a sale on approval, a bill and hold, or any other terms by
reason of which the payment by the Account Debtor may be conditional,

 

(e)                                  Accounts that are not payable in Dollars,

 

(f)                                    Accounts with respect to which the
Account Debtor either (i) does not maintain its chief executive office, or other
office acceptable to Administrative Agent in its Permitted Discretion, in the
United States, or (ii) is not organized under the laws of the United States or
any state thereof or the District of Columbia, or (iii) is the government of any
country or sovereign state other than the United States, or of any state,
province, municipality, or other political subdivision thereof, or of any
department, agency, public corporation, or other instrumentality thereof, unless
in each case (y) the Account is supported by an irrevocable letter of credit
satisfactory to Administrative Agent in its Permitted Discretion (as to form,
substance, and issuer or domestic confirming bank) that has been delivered to
Collateral Agent and is directly drawable by Collateral Agent, or (z) the
Account

 

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is covered by credit insurance in form, substance, and amount, and by an
insurer, satisfactory to Administrative Agent in its Permitted Discretion,

 

(g)                                 Accounts with respect to which the Account
Debtor is either (i) the United States or any department, agency, or
instrumentality of the United States (exclusive, however, of Accounts with
respect to which the applicable Borrower has complied, to the reasonable
satisfaction of Administrative Agent, with the Assignment of Claims Act, 31 USC
§ 3727), or (ii) any state of the United States,

 

(h)                                 Accounts with respect to which the Account
Debtor is a creditor of any Borrower and has or has asserted a right of setoff,
or has disputed its obligation to pay all or any portion of the Account, to the
extent of such claim, right of setoff, or dispute,

 

(i)                                     Accounts with respect to an Account
Debtor whose total obligations owing to Borrowers exceed 10% (such percentage,
as applied to a particular Account Debtor, being subject to reduction by
Administrative Agent in its Permitted Discretion if the creditworthiness of such
Account Debtor deteriorates) of all Eligible Accounts (except with respect to
(x) General Motors Corporation and its Affiliates, in which case the total
obligations of such Account Debtor shall not exceed 30% (such percentage being
subject to reduction by Administrative Agent in its Permitted Discretion if the
creditworthiness of such Account Debtor materially deteriorates) of all Eligible
Accounts and (y) the Specified Account Debtors and any other Account Debtor
designated by Administrative Agent in its Permitted Discretion, in which case
the total obligations of such Account Debtor shall not exceed 15% (such
percentage being subject to reduction by Administrative Agent in its Permitted
Discretion if the creditworthiness of such Account Debtor materially
deteriorates) of all Eligible Accounts), to the extent of the obligations owing
by such Account Debtor in excess of such percentage; provided, however, that, in
each case, the amount of Eligible Accounts that are excluded because they exceed
the foregoing percentage shall be determined by Administrative Agent based on
all of the otherwise Eligible Accounts prior to giving effect to any
eliminations based upon the foregoing concentration limit,

 

(j)                                     Accounts with respect to which the
Account Debtor is subject to an Insolvency Proceeding, to the knowledge of the
Loan Parties is not Solvent, has gone out of business, or as to which a Borrower
has received notice of an imminent Insolvency Proceeding or a material
impairment of the financial condition of such Account Debtor,

 

(k)                                  Accounts with respect to which the Account
Debtor is located in a state or jurisdiction (e.g., New Jersey, Minnesota, and
West Virginia) that requires, as a condition to access to the courts of such
jurisdiction, that a creditor qualify to transact business, file a business
activities report or other report or form, or take one or more other actions,
unless the applicable Borrower has so qualified, filed such reports or forms, or
taken such actions (and, in each case, paid any required fees or other charges),
except to the extent that the applicable Borrower may qualify subsequently as a
foreign entity authorized to transact business in such state or jurisdiction and
gain access to such courts, without incurring any cost or penalty viewed by
Administrative Agent to be significant in amount, and such later qualification
cures any access to such courts to enforce payment of such Account,

 

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(l)                                     Accounts, the collection of which,
Administrative Agent, in its Permitted Discretion, believes to be doubtful by
reason of the Account Debtor’s financial condition,

 

(m)                               Accounts that are not subject to a valid and
perfected first priority Agent’s Lien,

 

(n)                                 Accounts with respect to which (i) the goods
giving rise to such Account have not been shipped and billed to the Account
Debtor, or (ii) the services giving rise to such Account have not been performed
and billed to the Account Debtor, or

 

(o)                                 Accounts that represent the right to receive
progress payments or other advance billings that are due prior to the completion
of performance by the applicable Borrower of the subject contract for goods or
services.

 

“Environmental Actions” means any complaint, summons, citation, notice,
directive, order, claim, litigation, third party investigation, judicial or
administrative proceeding, judgment, letter, or other communication from any
Governmental Authority, or any third party involving violations of Environmental
Laws or releases of Hazardous Materials (a) from any assets, properties, or
businesses of any Borrower, any Subsidiary of a Borrower, or any of their
predecessors in interest, (b) from adjoining properties or businesses onto any
property of any Borrower, any Subsidiary of a Borrower, or any of their
predecessors in interest, or (c) from or onto any facilities which received
Hazardous Materials generated by any Borrower, any Subsidiary of a Borrower, or
any of their predecessors in interest.

 

“Environmental Law” means any applicable federal, state, provincial, foreign or
local statute, law, rule, regulation, ordinance, code, binding and enforceable
guideline, binding and enforceable written policy or rule of common law now or
hereafter in effect and in each case as amended, or any judicial or
administrative interpretation thereof, including any judicial or administrative
order, consent decree or judgment, in each case, to the extent binding on any
Borrower or any Subsidiary of a Borrower, relating to the environment, the
effect of the environment on employee health, or Hazardous Materials, in each
case as amended from time to time.

 

“Environmental Liabilities” means all liabilities, monetary obligations, losses,
damages, punitive damages, consequential damages, treble damages, costs and
expenses (including all reasonable fees, disbursements and expenses of counsel,
experts, or consultants, and costs of investigation and feasibility studies),
fines, penalties, sanctions, and interest incurred as a result of any claim or
demand, or Remedial Action required, by any Governmental Authority or any third
party, and which relate to any Environmental Action.

 

“Environmental Lien” means any Lien in favor of any Governmental Authority for
Environmental Liabilities.

 

“Equipment” means equipment (as that term is defined in the Code).

 

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“ERISA” means the Employee Retirement Income Security Act of 1974, as amended,
and any successor statute thereto.

 

“ERISA Affiliate” means (a) any Person subject to ERISA whose employees are
treated as employed by the same employer as the employees of a Borrower or a
Subsidiary of a Borrower under Section 414(b) of the IRC, (b) any trade or
business subject to ERISA whose employees are treated as employed by the same
employer as the employees of a Loan Party or a Significant Subsidiary under
Section 414(c) of the IRC, (c) solely for purposes of Section 302 of ERISA and
Section 412 of the IRC, any organization subject to ERISA that is a member of an
affiliated service group of which a Loan Party or a Significant Subsidiary is a
member under Section 414(m) of the IRC, or (d) solely for purposes of
Section 302 of ERISA and Section 412 of the IRC, any Person subject to ERISA
that is a party to an arrangement with a Loan Party or a Significant Subsidiary
and whose employees are aggregated with the employees of a Loan Party or a
Significant Subsidiary under Section 414(o) of the IRC.

 

“Euro” or “€” means the currency of participating member states of the European
Union that have adopted a single currency in accordance with the Treaty on
European Union of February 7, 1992.

 

“European Administrative Agent” has the meaning specified therefor in the
preamble to the Agreement.

 

“European Administrative Agent’s Account” means, with respect to Dollars, the
applicable Deposit Account of European Administrative Agent identified on
Schedule A-3 as the European Administrative Agent’s Dollar Deposit Account, with
respect to Euro, the applicable Deposit Account of European Administrative Agent
identified on Schedule A-3 as the European Administrative Agent’s Euro Deposit
Account and, with respect to Sterling, the applicable Deposit Account of
European Administrative Agent identified on Schedule A-3 as the European
Administrative Agent’s Sterling Deposit Account.

 

“European Administrative Borrower” means SITEL Europe Limited.

 

“European Advances” has the meaning specified therefor in Section 2.1(a).

 

“European Availability” means, as of any date of determination, the amount that
European Borrowers are entitled to borrow as European Advances hereunder (after
giving effect to all then outstanding European Revolver Usage and all sublimits
and reserves then applicable hereunder).

 

“European Borrowers” means SITEL UK Limited, SITEL Europe Limited, SITEL Ireland
Limited, SITEL GmbH, and SRM Inkasso GmbH and each other Subsidiary of Parent
created or organized under the laws of any jurisdiction other than the United
States or any state thereof or the District of Columbia or Canada or any
province thereof that becomes a Borrower hereunder pursuant to Section 5.15, and
“European Borrower” means any one of them.

 

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“European Borrowing” means a Borrowing hereunder consisting of European Advances
made on the same day by the Lenders (or Fronting Lender or European
Administrative Agent on behalf thereof), or by the European Swing Lender in the
case of a European Swing Loan, or by European Administrative Agent in the case
of a Protective Advance, in each case, to any European Borrower.

 

“European Borrowing Base” means, as of any date of determination, the Foreign
Borrowing Base less Canadian Revolver Usage.

 

“European Designated Account” means, with respect to Dollars, the applicable
Deposit Account of European Administrative Borrower identified on Schedule D-1
as the European Designated Account for Dollars, with respect to Euro, the
applicable Deposit Account of European Administrative Borrower identified on
Schedule D-1 as the European Designated Account for Euro and, with respect to
Sterling, the applicable Deposit Account of European Administrative Borrower
identified on Schedule D-1 as the European Designated Account for Sterling or,
in each case, such other account as European Administrative Borrower may specify
by notice to European Administrative Agent.

 

“European Designated Account Bank” has the meaning specified therefor in
Schedule D-1 or such other bank as European Administrative Borrower may specify
by notice to European Administrative Agent.

 

“European Issuing Lender” means WFF or any other Lender that, at the request of
Administrative Borrower and with the consent of European Administrative Agent,
agrees, in such Lender’s sole discretion, to become an Issuing Lender for the
purpose of issuing European L/Cs or European L/C Undertakings pursuant to
Section 2.12.

 

“European L/C” has the meaning specified therefor in Section 2.12(c).

 

“European L/C Disbursement” means a payment made by the European Issuing Lender
pursuant to a European Letter of Credit.

 

“European L/C Undertaking” has the meaning specified therefor in
Section 2.12(c)(i).

 

“European Lender” means a Lender that has an interest in the European Revolver
Commitment and/or the European Revolver Usage.

 

“European Letter of Credit” means a European L/C or a European L/C Undertaking,
as the context requires.

 

“European Letter of Credit Usage” means, as of any date of determination, the
Dollar Equivalent of the aggregate undrawn amount of all outstanding European
Letters of Credit.

 

“European Loan Account” has the meaning specified therefor in Section 2.10.

 

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“European Protective Advances” has the meaning specified therefor in
Section 2.3(d)(iii).

 

“European Revolver Commitment” means, with respect to each Lender, its European
Revolver Commitment, and, with respect to all Lenders, their European Revolver
Commitments, in each case as such Dollar amounts are set forth beside such
Lender’s name under the applicable heading on Schedule C-1 or in the Assignment
and Acceptance pursuant to which such Lender became a Lender hereunder, as such
amounts may be reduced or increased from time to time pursuant to assignments
made in accordance with the provisions of Section 13.1.

 

“European Revolver Usage” means, as of any date of determination, the sum of
(a) the Dollar Equivalent of the principal amount of outstanding European
Advances, plus (b) the amount of the European Letter of Credit Usage, in each
case as determined as of such date.

 

“European Risk Participation Liability” means, as to each European Letter of
Credit, all reimbursement obligations of European Borrowers to the European
Issuing Lender with respect to a European L/C Undertaking, consisting of (a) the
amount available to be drawn or which may become available to be drawn, (b) all
amounts that have been paid by the European Issuing Lender to the European
Underlying Issuer to the extent not reimbursed by European Borrowers, whether by
the making of a European Advance or otherwise, and (c) all accrued and unpaid
interest, fees, and expenses payable with respect thereto.

 

“European Swing Lender” means WFF or any other Lender that, at the request of
Administrative Borrower and with the consent of European Administrative Agent
agrees, in such Lender’s sole discretion, to become the European Swing Lender
under Section 2.3(b).

 

“European Swing Loan” has the meaning specified therefor in Section 2.3(b)(iii).

 

“European Underlying Issuer” means a third Person which is the beneficiary of a
European L/C Undertaking and which has issued a letter of credit at the request
of the European Issuing Lender for the benefit of one or more of the European
Borrowers.

 

“European Underlying Letter of Credit” means a letter of credit that has been
issued by a European Underlying Issuer.

 

“Event of Default” has the meaning specified therefor in Section 7.

 

“Excess Availability” means, as of any date of determination, the amount equal
to Availability plus Qualified Cash minus the aggregate amount, if any, of all
trade payables of Borrowers aged in excess of 90 days after such payables were
created or aged in excess of their historical levels with respect thereto and
all book overdrafts of Borrowers in excess of their historical practices with
respect thereto, in each case as determined by Administrative Agent in its
Permitted Discretion.

 

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“Excess Cash Flow” means, for any period, the remainder of (without duplication)
(a)  EBITDA for such period, minus (b) the sum, without duplication, of
(i) scheduled repayments of principal of Term Loan A and other Indebtedness for
borrowed money of Parent and its Subsidiaries (to the extent such Indebtedness
is permitted to be incurred, and such payments are permitted to be made, under
this Agreement) made in cash during such period, plus (ii) voluntary prepayments
of Indebtedness, but only to the extent such Indebtedness cannot be reborrowed,
plus (iii) cash payments (not financed with the proceeds of Indebtedness (other
than Advances)) made in such period with respect to Capital Expenditures to the
extent permitted to be made under this Agreement, plus (iv) all federal, state,
local and foreign income taxes paid in cash by Parent and its Subsidiaries,
during such period, plus (v) all Interest Expense paid in cash by Parent and its
Subsidiaries during such period to the extent permitted to be paid under this
Agreement plus (vi) mandatory prepayments of the Term Loan A pursuant to
Section 2.4(c)(v) and mandatory prepayments of the Term B Debt, plus (vii) any
non-cash items (including losses, charges, expenses, write-downs or write-offs
or in respect of amortization or depreciation) included in the calculation of
EBITDA, plus (viii) to the extent not otherwise deducted in calculating Excess
Cash Flow, cash restructuring and severance charges incurred and paid during the
fiscal year ending December 31, 2005 in an aggregate amount not to exceed
$5,500,000, plus (ix) all other cash payments made during such period on account
of fees, costs and expenses that were capitalized or otherwise were not deducted
in calculating Excess Cash Flow for such period, plus (x) cash consideration
paid during such period to make acquisitions of all or substantially all of the
assets and/or business of a Person or all of the Stock of a Person that are
permitted to be made under this Agreement.

 

“Excluded Deposit Accounts” means (i) Deposit Account no. 1-508-9055-9589
maintained with US Bank National Association to the extent such account is
pledged to US Bank National Association to secure letters of credit issued for
the account of a US Borrower and the aggregate Dollar Equivalent amount in such
Deposit Account does not exceed $900,000 and (ii) Deposit Accounts of any
Borrower solely to the extent all funds in such Deposit Accounts consist of
amounts held in trust by such Borrower for or in escrow for or on behalf of
customers of such Borrower.

 

“Existing Foreign Guarantors” means SITEL Asia Pacific Investments PTE Limited,
SITEL Customer Care Philippines, Inc., SITEL (BVI) International, Inc., and
Systems Integrated Telemarketing Netherlands B.V., and each other Subsidiary of
Parent created or organized under the laws of any jurisdiction other than the
United States, Ireland, United Kingdom, Germany or Canada or any state or
province thereof or the District of Columbia that becomes a Guarantor hereunder
as of the date hereof.

 

“Existing Lender” means Fleet Capital Corporation.

 

“Extraordinary Receipts” means any cash Collections received by any US Loan
Party not in the ordinary course of business (and not consisting of proceeds
described in Section 2.4(c)(ii) or Section 2.4(c)(iv) hereof), including the
following (solely to the extent any of the following is not in the ordinary
course of business): (a) foreign, United States, state or local tax refunds
(excluding value added tax payments received from a

 

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Governmental Authority that will be netted against future value added tax
payments to such Governmental Authority), (b) pension plan reversions,
(c) proceeds of insurance (including proceeds of key man life insurance
policies) other than such proceeds to the extent that the amounts so received
are applied by a Loan Party for the purpose of satisfying the condition giving
rise to the insurance claim, (d) proceeds of judgments, proceeds of settlements,
or other consideration of any kind in connection with any cause of action,
(e) condemnation awards (and payments in lieu thereof), (f) indemnity payments,
and (g) any purchase price adjustment received in connection with any purchase
agreement); provided, that, individual, unrelated Collections in a Dollar
Equivalent amount of less than or equal to $5,000 shall be deemed not to
constitute Extraordinary Receipts for purposes of this Agreement.

 

“Exchange Act” means the Securities Exchange Act of 1934, as in effect from time
to time.

 

“Fiscal Month” means a calendar month.

 

“Fee Letter” means that certain fee letter between Borrowers and Administrative
Agent, in form and substance satisfactory to Administrative Agent.

 

“Fixed Charges” means with respect to Parent and its Subsidiaries for any
period, the sum, without duplication, of (a) Interest Expense (net of interest
income) paid in cash during such period, (b) scheduled principal payments
required to be paid during such period in respect of Indebtedness, and (c) all
federal, state, and local income taxes paid during such period.

 

“Fixed Charge Coverage Ratio” means, with respect to Parent and its Subsidiaries
for any period, the ratio of (i) EBITDA for such period minus Capital
Expenditures made (to the extent not already incurred in a prior period) or
incurred during such period, to (ii) Fixed Charges for such period.

 

“Foreign Advances” means Canadian Advances and European Advances.

 

“Foreign Bank Product Reserve” means, as of any date of determination, the
lesser of (a) $5,000,000 less the amount of the Bank Product Reserve, if any,
and (b) the amount of reserves that Administrative Agent has established (based
upon the Bank Product Providers’ reasonable determination of the credit exposure
of Foreign Borrowers’ and Foreign Subsidiaries in respect of Bank Products) in
respect of Bank Products then provided or outstanding to Foreign Loan Parties;
provided, that in order to qualify as Foreign Bank Product Reserves such
reserves must be established on or prior to the time that the Bank Product
Provider first provides the applicable Bank Product.

 

“Foreign Borrowers” means European Borrowers and Canadian Borrowers, and
“Foreign Borrower” means any one of them.

 

“Foreign Borrowing” means a Borrowing hereunder consisting of European Advances
and Canadian Advances made on the same day by the Lenders (or Fronting Lender,
Canadian Administrative Agent or European Administrative Agent on behalf

 

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thereof), or by the Canadian Swing Lender in the case of a Canadian Swing Loan,
or by the European Swing Lender in the case of a European Swing Loan, or by
Canadian Administrative Agent or European Administrative Agent in the case of a
Protective Advance, in each case, to any European Borrower or Canadian Borrower.

 

“Foreign Borrowing Base” means, as of any date of determination, the result of:

 

(a)                                  (i)                                    
(x) 85% of the amount of the Dollar Equivalent of Eligible Foreign Accounts,
plus (y) the lesser of (A) 85% of the amount of the Dollar Equivalent of
Eligible Unbilled Foreign Accounts and (B) $30,000,000, less (z) the amount, if
any, of the Foreign Dilution Reserve, less

 

(ii)                                  the sum of (A) the Foreign Bank Product
Reserve, and (B) the aggregate amount of reserves, if any, established by
Administrative Agent under Section 2.1(b) with respect to Foreign Borrowers,
plus

 

(b)                                 (i)                                    
(x) 85% of the amount of Eligible US Accounts, plus (y) the lesser of (A) 85% of
the amount of Eligible Unbilled US Accounts and (B) $30,000,000, less (z) the
amount, if any, of the US Dilution Reserve, less

 

(ii)                                  the sum of (A) the Bank Product Reserve,
and (B) without duplication of clause (a)(ii)(B) above, the aggregate amount of
reserves, if any, established by Administrative Agent under Section 2.1(b), less

 

(c)                                  US Revolver Usage,

 

provided, however, that the sum of clauses (a)(i)(y) and (b)(i)(y) above shall
not exceed $30,000,000.

 

“Foreign Borrowing Base Certificate” means a certificate substantially in the
form of Exhibit B-1(B) or any other form acceptable to Administrative Agent.

 

“Foreign Collateral” means all assets and interests in assets and proceeds
thereof now owned or hereafter acquired by any Foreign Borrower in or upon which
a Lien is granted by such Foreign Borrower under any of the Loan Documents.

 

“Foreign Dilution” means, as of any date of determination, a percentage, based
upon the experience of the immediately prior 12 Fiscal Months, that is the
result of dividing the Dollar Equivalent amount of (a) bad debt write-downs,
discounts, advertising allowances, credits, or other dilutive items with respect
to Foreign Borrowers’ Accounts during such period, by (b) Foreign Borrowers’
gross billings with respect to Accounts during such period.

 

“Foreign Dilution Reserve” means, as of any date of determination, an amount
sufficient to reduce the advance rate against Eligible Foreign Accounts by 1
percentage point for each percentage point by which Foreign Dilution is in
excess of 5%.

 

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“Foreign Guarantors” means Existing Foreign Guarantors and any other Subsidiary
(other than a Foreign Borrower or an Immaterial Subsidiary) of a Borrower
organized under the laws of any jurisdiction within Ireland, United Kingdom,
Germany or Canada that becomes a Guarantor after the date hereof, and “Foreign
Guarantor” means any one of them.

 

“Foreign Loan Parties” means the Foreign Borrowers and Foreign Guarantors, and
“Foreign Loan Party” means any one of them.

 

“Foreign Obligations” means (a) all loans, Foreign Advances, debts, principal,
interest (including any interest that accrues after the commencement of an
Insolvency Proceeding regardless of whether allowed or allowable in whole or in
part as a claim in any such Insolvency Proceeding), contingent reimbursement
obligations with respect to outstanding Canadian Letters of Credit, contingent
reimbursement obligations with respect to outstanding European Letters of
Credit, premiums, liabilities (including all amounts charged to the Canadian
Loan Account and European Loan Account pursuant hereto), obligations (including
indemnification obligations), fees (including the fees provided for in the Fee
Letter), charges, costs, Lender Group Expenses (including any fees or expenses
that accrue after the commencement of an Insolvency Proceeding, regardless of
whether allowed or allowable in whole or in part as a claim in any such
Insolvency Proceeding), lease payments, guaranties, covenants, and duties of any
kind and description owing by Foreign Borrowers to the Lender Group pursuant to
or evidenced by the Loan Documents and irrespective of whether for the payment
of money, whether direct or indirect, absolute or contingent, due or to become
due, now existing or hereafter arising, and including all interest not paid when
due and all Lender Group Expenses that Foreign Borrowers are required to pay or
reimburse by the Loan Documents, by law, or otherwise, and (b) all Bank Product
Obligations owing by the Foreign Borrowers.  Any reference in the Agreement or
in the Loan Documents to the Foreign Obligations shall include all or any
portion thereof and any extensions, modifications, renewals, or alterations
thereof, both prior and subsequent to any Insolvency Proceeding.

 

“Foreign Revolver Usage” means, as of any date of determination, the sum of
(a) the Dollar Equivalent of the principal amount of outstanding European
Advances, plus (b) the Dollar Equivalent of the principal amount of outstanding
Canadian Advances, plus (c) the amount of the European Letter of Credit Usage,
plus (d) the amount of the Canadian Letter of Credit Usage, in each case as
determined as of such date.

 

“Foreign Subsidiaries” means the Foreign Borrowers, the Foreign Guarantors and
each other Subsidiary of Administrative Borrower not created or organized under
the laws of the United States or any state thereof or the District of Columbia,
and “Foreign Subsidiary” means any one of them.

 

“Fraudulent Conveyance” has the meaning specified therefor in Section 2.15(i).

 

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“Fronted Loans” means that portion of the Advances which is funded by the
Fronting Lender and has not been funded by another Lender.

 

“Fronting Lender” has the meaning set forth in the preamble to the Agreement.

 

“Fronting Loan Event” means in the event that any change in market conditions or
any law, regulation, treaty, or directive, or any change therein or in the
interpretation or application thereof, shall at any time after the date hereof,
in the reasonable opinion of Fronting Lender, make it unlawful or impractical
for Fronting Lender to fund or maintain Fronted Loans or to continue such
funding or maintaining.

 

“Funding Date” means any date on which a Borrowing occurs.

 

“Funding Losses” has the meaning specified therefor in Section 2.13(b)(ii).

 

“GAAP” means generally accepted accounting principles as in effect from time to
time in the United States, consistently applied.

 

“German Borrowers” means SITEL GmbH and SRM Inkasso GmbH and each other
Subsidiary of Parent created or organized under the laws of Germany or any state
or province thereof that becomes a Borrower hereunder pursuant to Section 5.15,
and “German Borrower” means any one of them.

 

“Governing Documents” means, with respect to any Person, the certificate or
articles of incorporation, by-laws, unanimous shareholder agreement or unanimous
shareholder declaration, if any, or other organizational documents of such
Person, and all amendments thereto.

 

“Governmental Authority” means any federal (including the federal governments of
Canada, Germany, Spain and the United Kingdom), the government of the Republic
of Ireland, state, provincial, local, or other governmental or administrative
body, instrumentality, board, department, or agency or any court, tribunal,
administrative hearing body, arbitration panel, commission, or other similar
dispute-resolving panel or body.

 

“Guarantors” means each US Guarantor and each Foreign Guarantor, and “Guarantor”
means any one of them.

 

“Guaranty” means a US Guaranty or a general continuing guaranty executed and
delivered by each Guarantor in favor of Collateral Agent for the benefit of the
Lender Group and the Bank Product Providers, in form and substance satisfactory
to Collateral Agent.

 

“Hazardous Materials” means (a) substances that are defined or listed in, or
otherwise classified pursuant to, any Applicable Laws or regulations as
“hazardous substances,” “hazardous materials,” “hazardous wastes,” “toxic
substances,” or any other formulation intended to define, list, or classify
substances by reason of deleterious properties such as ignitability,
corrosivity, reactivity, carcinogenicity, reproductive toxicity, or “EP

 

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toxicity”, (b) oil, petroleum, or petroleum derived substances, natural gas,
natural gas liquids, synthetic gas, drilling fluids, produced waters, and other
wastes associated with the exploration, development, or production of crude oil,
natural gas, or geothermal resources, (c) any flammable substances or explosives
or any radioactive materials, and (d) asbestos in any form or electrical
equipment that contains any oil or dielectric fluid containing levels of
polychlorinated biphenyls in excess of 50 parts per million.

 

“Hedge Agreement” means any and all agreements, or documents now existing or
hereafter entered into by Administrative Borrower or any of its Subsidiaries
that provide for an interest rate, credit, commodity or equity swap, cap, floor,
collar, forward foreign exchange transaction, currency swap, cross currency rate
swap, currency option, or any combination of, or option with respect to, these
or similar transactions, for the purpose of hedging Administrative Borrower’s or
any of its Subsidiaries’ exposure to fluctuations in interest or exchange rates,
loan, credit exchange, security or currency valuations or commodity prices.

 

“Holdout Lender” has the meaning specified therefor in Section 14.2(a).

 

“Immaterial Subsidiary” means a Person that is (i) a Subsidiary of Parent, and
(ii) listed on Schedule I-1 attached hereto, or otherwise designated in a
written notice by Administrative Borrower as an “Immaterial Subsidiary” for the
purposes of the Agreement; provided, that, any such Subsidiary shall not
continue to constitute a “Immaterial Subsidiary” for more than thirty (30) days
after such Subsidiary was formed or acquired unless approved as an Immaterial
Subsidiary by Administrative Agent in its Permitted Discretion.

 

“Indebtedness” of any Person means, without duplication (a) all obligations of
such Person for borrowed money, (b) all obligations of such Person evidenced by
bonds, debentures, notes, or other similar instruments and all reimbursement or
other obligations of such Person in respect of letters of credit, bankers
acceptances, or other similar financial products, (c) all obligations of such
Person as a lessee under Capital Leases, (d) all obligations or liabilities of
others secured by a Lien on any asset of such Person, irrespective of whether
such obligation or liability is assumed, (e) all obligations of such Person to
pay the deferred purchase price of assets (other than trade payables incurred in
the ordinary course of business, payable in accordance with customary trade
practices and not outstanding for more than 90 days after the date such payable
was created), (f) all obligations of such Person owing under Hedge Agreements,
and (g) any obligation of such Person guaranteeing or intended to guarantee
(whether directly or indirectly guaranteed, endorsed, co-made, discounted, or
sold with recourse) any obligation of any other Person that constitutes
Indebtedness under any of clauses (a) through (f) above.  For purposes of this
definition (x) the amount of the obligations of a Person under a Hedge Agreement
at any date shall be equal to the amount payable by such Person to the relevant
counterparties on such date (net of any amounts payable to such Person by such
counterparties) and (y) the amount of any guarantee obligation of a Person shall
(subject to any limitation set forth therein) be deemed to be an amount equal to
the stated or determinable amount of the related primary obligation, or portion
thereof, in respect of which such guarantee is made or, if not stated or
determinable, the maximum reasonably anticipated liability in respect thereof as
determined

 

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by such Person in good faith.  For purposes of Section 6.1, (i) reimbursement
obligations of a US Borrower in respect of standby letters of credit shall not
constitute Indebtedness to the extent such letters of credit support
Indebtedness of another US Borrower that is otherwise permitted under
Section 6.1, (ii) reimbursement obligations of a US Guarantor in respect of
standby letters of credit shall not constitute Indebtedness to the extent such
letters of credit support Indebtedness of another US Loan Party that is
otherwise permitted under Section 6.1, (iii) reimbursement obligations of a
Foreign Borrower in respect of standby letters of credit shall not constitute
Indebtedness to the extent such letters of credit support Indebtedness of a US
Loan Party or another Foreign Borrower that is otherwise permitted under
Section 6.1, (iv) reimbursement obligations of a Foreign Guarantor in respect of
standby letters of credit shall not constitute Indebtedness to the extent such
letters of credit support Indebtedness of another Loan Party that is otherwise
permitted under Section 6.1 and (v) reimbursement obligations of a Significant
Subsidiary in respect of standby letters of credit shall not constitute
Indebtedness to the extent such letters of credit support Indebtedness of Parent
or any other Subsidiary of Parent that is otherwise permitted under
Section 6.1.  For purposes of Section 6.17, reimbursement obligations in respect
of standby letters of credit shall not constitute Indebtedness to the extent
such letters of credit support Indebtedness of Parent or any Subsidiary of
Parent.

 

“Indemnified Liabilities” has the meaning specified therefor in Section 10.3.

 

“Indemnified Person” has the meaning specified therefor in Section 10.3.

 

“Indenture” means the Indenture dated as of March 10, 1998 among the Parent, the
subsidiary guarantors named therein and Manufacturers & Traders Trust Company,
successor to Allfirst Bank, formerly The First National Bank of Maryland, as
Trustee, in respect of the Parent’s Series A and Series B 9 1/4% Senior
Subordinated Notes due 2006, as amended, supplemented or otherwise modified.

 

“Insolvency Proceeding” means any proceeding commenced by or against any Person
under any provision of the Bankruptcy Code, England’s Insolvency Act of 1986,
Ireland’s Companies Acts of 1963 to 2003 or under any other state or federal or
non-US jurisdiction bankruptcy or insolvency law, assignments for the benefit of
creditors, formal or informal moratoria, compositions, extensions generally with
creditors, or proceedings seeking reorganization, arrangement, or other similar
relief.

 

“Intercompany Subordination Agreement” means a subordination agreement executed
and delivered by Loan Parties and Collateral Agent, the form and substance of
which is satisfactory to Collateral Agent.

 

“Intercreditor Agreement” means the Lien Intercreditor Agreement of even date
herewith among Term B Agent, and Collateral Agent, and acknowledged by the US
Borrowers, as amended, supplemented, restated or otherwise modified from time to
time.

 

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“Interest Expense” means, for any period, the aggregate of the interest expense
of Parent and its Subsidiaries for such period, determined on a consolidated
basis in accordance with GAAP.

 

“Interest Period” means, with respect to each LIBOR Rate Loan other than
Approved Offshore Rate Loans, a period commencing on the date of the making of
such LIBOR Rate Loan (or the continuation of a LIBOR Rate Loan or the conversion
of a Base Rate Loan to a LIBOR Rate Loan) and ending 1, 2, 3, or 6 months
thereafter and, with respect to each Approved Offshore Rate Loan, a period
commencing on the date of the making of such LIBOR Rate Loan (or the
continuation of a LIBOR Rate Loan or the conversion of a Base Rate Loan to a
LIBOR Rate Loan) and ending 1 or 2 Weeks or 1, 2, 3, or 6  months thereafter;
provided, however, that (a) if any Interest Period would end on a day that is
not a Business Day, such Interest Period shall be extended (subject to clauses
(c)-(e) below) to the next succeeding Business Day, (b) interest shall accrue at
the applicable rate based upon the LIBOR Rate from and including the first day
of each Interest Period to, but excluding, the day on which any Interest Period
expires, (c) any Interest Period that would end on a day that is not a Business
Day shall be extended to the next succeeding Business Day unless such Business
Day falls in another calendar month, in which case such Interest Period shall
end on the next preceding Business Day, (d) with respect to an 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), the Interest Period shall end on the last Business Day of
the calendar month that is 1 or 2 Weeks or 1, 2, 3, or 6 months after the date
on which the Interest Period began, as applicable, and (e) Borrowers (or
Administrative Borrower on behalf thereof) may not elect an Interest Period
which will end after the Maturity Date.

 

“Inventory” means inventory (as that term is defined in the Code).

 

“Investment” means, with respect to any Person, any investment by such Person in
any other Person (including Affiliates) in the form of loans, guarantees,
advances, or capital contributions (excluding (a) commission, travel, and
similar advances to officers and employees of such Person made in the ordinary
course of business, and (b) bona fide Accounts arising in the ordinary course of
business consistent with past practice), purchases or other acquisitions of
Indebtedness, Stock, or all or substantially all of the assets of such other
Person (or of any division or business line of such other Person), and any other
items that are or would be classified as investments on a balance sheet prepared
in accordance with GAAP.

 

“IRC” means the Internal Revenue Code of 1986, as in effect from time to time.

 

“Irish Borrowers” means SITEL Ireland Limited and each other Subsidiary of
Parent created or organized under the laws of the Republic of Ireland or any
state or province thereof that becomes a Borrower hereunder pursuant to
Section 5.15, and “Irish Borrower” means any one of them.

 

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“Issuing Lenders” means the US Issuing Lender, the Canadian Issuing Lender and
the European Issuing Lender.

 

“Judgment Currency” has the meaning specified therefor in Section 10.4.

 

“Law (or Laws)” means, in respect of the United States, Canada and any other
country, all published laws, statutes, codes, ordinances, decrees, rules,
regulations, by-laws, judicial or arbitral or administrative or ministerial or
departmental or regulatory judgments, orders, decisions, rulings or awards,
including general principles of common and civil law, and conditions or any
grant of approval, permission, authority or license of any court, Governmental
Authority, statutory body or self-regulatory authority.

 

“Lender” and “Lenders” have the respective meanings set forth in the preamble to
the Agreement, and shall include any other Person made a party to the Agreement
in accordance with the provisions of Section 13.1.

 

“Lender Group” means, individually and collectively, each of the Lenders
(including the Fronting Lender and the Issuing Lenders) and Agents.

 

“Lender Group Expenses” means all (a) costs or expenses (including taxes, and
insurance premiums) required to be paid by a Borrower or its Subsidiaries under
any of the Loan Documents that are paid, advanced, or incurred by any one or
more members of the Lender Group, (b) fees or charges paid or incurred by any
Agent in connection with the Lender Group’s transactions contemplated by the
Loan Documents with Borrowers or their Subsidiaries, including, fees or charges
for photocopying, notarization, couriers and messengers, telecommunication,
public record searches (including tax lien, judgment, and UCC searches and
including searches with the patent and trademark office, the copyright office,
or the department of motor vehicles to the extent Liens on motor vehicles are
required to be perfected under the Loan Documents), filing, recording,
publication, appraisal (including periodic collateral appraisals or business
valuations) to the extent of the fees and charges (and up to the amount of any
limitation) contained in the Agreement and, in the event any real estate is
pledged as Collateral, real estate surveys, real estate title policies and
endorsements, and environmental audits, (c) costs and expenses incurred by any
Agent in the disbursement of funds to Borrowers or other members of the Lender
Group (by wire transfer or otherwise), (d) charges paid or incurred by any Agent
resulting from the dishonor of checks, (e) reasonable costs and expenses paid or
incurred by the Lender Group to correct any default or enforce any provision of
the Loan Documents, or in gaining possession of, maintaining, handling,
preserving, storing, shipping, selling, preparing for sale, or advertising to
sell the Collateral, or any portion thereof, irrespective of whether a sale is
consummated, (f) audit fees and expenses of any Agent related to any inspections
or audits to the extent of the fees and charges (and up to the amount of any
limitation) contained in this Agreement, (g) reasonable costs and expenses of
third party claims or any other suit paid or incurred by any one or more members
of the Lender Group in enforcing or defending the Loan Documents or in
connection with the transactions contemplated by the Loan Documents or the
Lender Group’s relationship with any Borrower or any Subsidiary of a Borrower,
(h) each Agent’s reasonable costs and expenses (including reasonable attorneys

 

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fees) incurred in advising, structuring, drafting, reviewing, administering,
syndicating (including, without limitation, any Additional German Opinion
Costs), or amending the Loan Documents, (i) any foreign exchange costs incurred
by Agents or Lenders resulting from converting currencies to the extent
necessary and in accordance with this Agreement, and (j) each Agent’s and each
Lender’s reasonable costs and expenses (including attorneys, accountants,
consultants, and other advisors fees and expenses) incurred in terminating,
enforcing (including reasonable attorneys, accountants, consultants, and other
advisors fees and expenses incurred in connection with a “workout,” a
“restructuring,” or an Insolvency Proceeding concerning any Borrower or any
Subsidiary of a Borrower or in exercising rights or remedies under the Loan
Documents), or defending the Loan Documents, irrespective of whether suit is
brought, or in taking any Remedial Action concerning the Collateral.

 

“Lender-Related Person” means, with respect to any Lender, such Lender, together
with such Lender’s Affiliates, officers, directors, employees, attorneys, and
agents.

 

“Letter of Credit Usage” means, as of any date of determination, the sum of the
Canadian Letter of Credit Usage, the European Letter of Credit Usage and the US
Letter of Credit Usage, as determined as of such date.

 

“Letters of Credit” means Canadian Letters of Credit, European Letters of Credit
and US Letters of Credit, as applicable.

 

“Leverage Ratio” means, as of any date, the ratio of (a) the sum of the Revolver
Usage (other than Letter of Credit Usage cash collateralized in an amount up to
105% of such Letter of Credit Usage), the outstanding principal balance of the
Term Loan A and Term B Debt and the aggregate principal amount of all other
Indebtedness (other than cash collateralized letters of credit) of Parent and
its Subsidiaries outstanding as of such date in the amount that would be
reflected as debt on a balance sheet prepared as of such date on a consolidated
basis in accordance with GAAP to (b) EBITDA for the 12 month period ended as of
such date.

 

“LIBOR Deadline” has the meaning specified therefor in Section 2.13(b)(i).

 

“LIBOR Notice” means a written notice substantially in the form of Exhibit L-1.

 

“LIBOR Option” has the meaning specified therefor in Section 2.13(a).

 

“LIBOR Rate” means, as applicable, the US LIBOR Rate, the Canadian LIBOR Rate or
the Approved Offshore Currency Rate.

 

“LIBOR Rate Loan” means each portion of an Advance or the Term Loan A that bears
interest at a rate determined by reference to the LIBOR Rate.

 

“LIBOR Rate Margin” means 2.75%; provided that, at any time that the outstanding
principal balance of the Term Loan A has been paid in full, the LIBOR Rate
Margin shall be 2.00%.

 

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“LIBOR Rate Term Loan A Margin” means 2.75%.

 

“Lien” means any interest in an asset securing an obligation owed to, or a claim
by, any Person other than the owner of the asset, irrespective of whether
(a) such interest is based on the common law, civil law, statute, or contract,
(b) such interest is recorded or perfected, and (c) such interest is contingent
upon the occurrence of some future event or events or the existence of some
future circumstance or circumstances.  Without limiting the generality of the
foregoing, the term “Lien” includes the lien, hypothec or security interest
arising from a mortgage, deed of trust, encumbrance, notice of Lien, levy or
assessment, pledge, hypothecation, assignment, deposit arrangement, security
agreement, conditional sale or trust receipt, or from a lease, consignment, or
bailment for security purposes and also includes reservations, exceptions,
encroachments, easements, rights-of-way, covenants, conditions, restrictions,
leases, and other title exceptions and encumbrances affecting Real Property.

 

“Loan Account” has the meaning specified therefor in Section 2.10.

 

“Loan Documents” means the Agreement, the Bank Product Agreements, the Cash
Management Agreements, the Control Agreements, the Fee Letter, the Pre-approved
Asset Disposition Letter, the Guaranties, the Intercompany Subordination
Agreement, the Letters of Credit, the Mortgages, if any, the Security
Agreements, the Disbursement Letter, the Officers’ Certificate, any note or
notes executed by a Borrower or any Guarantor in connection with the Agreement
and payable to a member of the Lender Group and any other agreement entered
into, now or in the future, by any Borrower and the Lender Group in connection
with the Agreement.

 

“Loan Parties” means the US Loan Parties and the Foreign Loan Parties, and “Loan
Party” means any one of them.

 

“Material Adverse Change” means (a) a material adverse change in the business,
operations, results of operations, assets, liabilities or financial condition of
Borrowers and their Subsidiaries, taken as a whole, (b) a material adverse
change in the business, operations, results of operations, assets, liabilities
or financial condition of US Loan Parties, taken as a whole, (c) a material
impairment of a Borrower’s or any of its Subsidiaries’ ability to perform its
material obligations under the Loan Documents to which it is a party or of the
Lender Group’s ability to enforce the Obligations or realize upon a material
portion of the Collateral, or (d) a material impairment of the enforceability or
priority of the Agent’s Liens with respect to a material portion of the
Collateral as a result of an action or failure to act on the part of a Borrower
or a Subsidiary of a Borrower.

 

“Maturity Date” has the meaning specified therefor in Section 3.3.

 

“Maximum Canadian Revolver Amount” means the least of (x) $10,000,000,
(y) $30,000,000 less the European Revolver Usage and (z) $90,000,000 less the
sum of the Availability Reserve, US Revolver Usage and European Revolver Usage.

 

“Maximum European Revolver Amount” means the lesser of (x) $30,000,000 less the
Canadian Revolver Usage and (y) $90,000,000 less the sum of the Availability
Reserve, US Revolver Usage and Canadian Revolver Usage.

 

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“Maximum Non-Loan Party Percentage” means (x) if the Leverage Ratio for the 4
fiscal quarters ending on the last day of the then most recently ended fiscal
quarter for which financial statements have been delivered is greater than
2.00:1.00, 10% and (y) if the Leverage Ratio for the 4 fiscal quarters ending on
the last day of the then most recently ended fiscal quarter for which financial
statements have been delivered is equal to or less than 2.00:1.00, 12.5%.

 

“Maximum Revolver Amount” means $90,000,000.

 

“Maximum US Revolver Amount” means $90,000,000 less the sum of the Availability
Reserve and the Foreign Revolver Usage.

 

“Mortgages” means, individually and collectively, one or more mortgages, deeds
of trust, or deeds to secure debt, executed and delivered by a US Borrower in
favor of Collateral Agent for the benefit of the Lender Group and the Bank
Product Providers, in form and substance reasonably satisfactory to Collateral
Agent, that encumber the Real Property Collateral.

 

“Net Assets” has the meaning specified therefor in Section 2.15(j).

 

“Net Cash Proceeds” means, (i) with respect to any sale or disposition by any
Person of property or assets, the amount of cash Collections received (directly
or indirectly) from time to time (whether as initial consideration or through
the payment of deferred consideration) by or on behalf of such Person, but only
as and when received, in connection therewith after deducting therefrom only
(A) the amount of any Indebtedness secured by any Permitted Lien on any asset
(other than (1) Indebtedness owing under this Agreement or the other Loan
Documents and (2) Indebtedness assumed by the purchaser of such asset) which is
required to be, and is, repaid in connection with such disposition,
(B) reasonable fees and expenses related thereto incurred by such Person in
connection therewith, (C) taxes paid or payable to any taxing authorities by
such Person in connection therewith and (D) in the case of the asset sale
described in the Pre-approved Asset Disposition Letter, reserves established by
such Person and reasonably acceptable to Administrative Agent to fund contingent
liabilities reasonably estimated to be payable in connection therewith solely to
the extent such contingent liabilities are funded within 90 days of the
consummation of such asset sale and (ii) with respect to the issuance or
incurrence of any Indebtedness by any Person, or the sale or issuance by any
Person of its Stock, the aggregate amount of cash received (directly or
indirectly) from time to time (whether as initial consideration or through the
payment or disposition of deferred compensation) by or on behalf of such Person,
but only as and when received, in connection therewith, after deducting
therefrom only (A) reasonable fees and expenses related thereto incurred by such
Person in connection therewith, (B)  taxes paid or payable by such Person in
connection therewith and (C) income taxes to be paid in connection therewith
(after taking into account any tax credits or deductions and any tax

 

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sharing arrangements); in each case of clause (i) and (ii) to the extent, but
only to the extent, that the amounts so deducted are (1) actually paid or are
payable or, in the case of the asset sale described in the Pre-Approved Asset
Disposition Letter, accrued as a liability, to a Person that, except in the case
of reasonable out-of-pocket expenses, is not an Affiliate of such Person or any
of its Subsidiaries and (2) properly attributable to such transaction or to the
asset that is the subject thereof.

 

“Non-Loan Party Subsidiaries” means the Subsidiaries of Parent identified on
Schedule N-1 and Subsidiaries of the Parent formed or acquired after the Closing
Date, designated in a written notice by Administrative Borrower as a “Non-Loan
Party Subsidiary” for purposes of this Agreement, in each case that (i) have not
been designated as Loan Parties or Significant Subsidiaries by Administrative
Borrower in accordance with Section 6.16 or otherwise and (ii) are not created
or organized under the laws of the United States, Ireland, United Kingdom,
Germany or Canada or any state or province thereof or the District of Columbia,
and “Non-Loan Party Subsidiary” means any one of them; provided, that, any such
Subsidiary shall not continue to constitute a “Non-Loan Party Subsidiary” for
more than thirty (30) days after such Subsidiary was formed or acquired unless
approved by Administrative Agent in its Permitted Discretion.

 

“Non-Offshore Currency Lender” means a Lender (other than the Fronting Lender)
which has given notice to the Administrative Agent and the Fronting Lender that
such Lender can not fund Offshore Currency Rate Loans (except as provided in
Section 2.17).

 

“Obligations” means (a) all loans (including the Term Loan A), Advances, debts,
principal, interest (including any interest that accrues after the commencement
of an Insolvency Proceeding regardless of whether allowed or allowable in whole
or in part as a claim in any such Insolvency Proceeding), contingent
reimbursement obligations with respect to outstanding Letters of Credit,
premiums, liabilities (including all amounts charged to the Borrowers’ Loan
Accounts pursuant hereto), obligations (including indemnification obligations),
fees (including the fees provided for in the Fee Letter), charges, costs, Lender
Group Expenses (including any fees or expenses that accrue after the
commencement of an Insolvency Proceeding, regardless of whether allowed or
allowable in whole or in part as a claim in any such Insolvency Proceeding),
lease payments, guaranties, covenants, and duties of any kind and description
owing by the applicable Borrowers to the Lender Group pursuant to or evidenced
by the Loan Documents and irrespective of whether for the payment of money,
whether direct or indirect, absolute or contingent, due or to become due, now
existing or hereafter arising, and including all interest not paid when due and
all Lender Group Expenses that Borrowers are required to pay or reimburse by the
Loan Documents, by law, or otherwise, and (b) all Bank Product Obligations.  Any
reference in the Agreement or in the Loan Documents to the Obligations shall
include all or any portion thereof and any extensions, modifications, renewals,
or alterations thereof, both prior and subsequent to any Insolvency Proceeding.

 

“Officers’ Certificate” means the representations and warranties of officers
form submitted by Administrative Agent to Parent, together with the Borrowers’
and

 

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Guarantors’ completed responses to the inquiries set forth therein, the form and
substance of such responses to be reasonably satisfactory to Administrative
Agent.

 

“Originating Lender” has the meaning specified therefor in Section 13.1(e).

 

“Offshore Currency Rate Loan” means each portion of an Advance that is
denominated in an Approved Offshore Currency.

 

“Overadvance” has the meaning specified therefor in Section 2.5.

 

“Parent” has the meaning specified therefor in the preamble to the Agreement.

 

“Patriot Act” means Laws relating to terrorism or money laundering, including
Executive Order No. 13224 (effective September 24, 2001), the USA PATRIOT Act,
the Laws comprising or implementing the Bank Secrecy Act, and the Laws
administered by OFAC.

 

“Participant” has the meaning specified therefor in Section 13.1(e).

 

“Permitted Acquisition” means an acquisition of the assets and/or business of a
Person by a Borrower or the acquisition of all of the Stock of a Person (such
Person, the “Target”) by a Borrower in which (a) (i) the business and assets
acquired by a US Borrower are located in the United States, the business and
assets acquired by a Foreign Borrower are located in Canada, UK, Germany or
Ireland and or the business and assets of the Target are located in the United
States, Canada, UK, Germany or Ireland and (ii) such business is, and such
assets are for use in, the same business engaged in by Borrowers as of the
Closing Date or a business reasonably related, complementary or incidental
thereto or a reasonable extension thereof, (b) immediately before and after
giving effect to such asset acquisition or Stock acquisition and the making of
any Advances in connection therewith, no Default or Event of Default exists
(and, with respect to the financial covenants included in Section 6.17,
Administrative Agent has been provided with calculations showing compliance with
such financial covenants on a pro forma basis as of the most recent month end
for which financial statements have been delivered, after giving effect to such
asset or Stock acquisition), (c) the Dollar Equivalent of the aggregate
consideration to be paid by the Borrowers (including any liabilities assumed by
Borrower and the liabilities retained by the Target) in connection with such
asset or Stock acquisition, together with the consideration paid in connection
with all other asset or Stock acquisitions completed by Borrowers during the
consecutive 12-month period ending on the date of such asset or Stock
acquisition, does not exceed the Annual Acquisition Limit, (d) the Dollar
Equivalent of the aggregate consideration to be paid by Borrowers (including any
liabilities assumed by Borrowers and any liabilities retained by the Target) in
connection with such asset or Stock acquisition, together with the consideration
paid in connection with all of the asset or Stock acquisitions completed by
Borrowers during the period commencing on the Closing Date and ending on the
date of such asset or Stock acquisition, does not exceed $20,000,000, (e) the
acquisition is consensual and has been approved by the respective board of
directors of the parties to such acquisition (including in the case of a Stock
acquisition, the board of directors of the Target), (f) at the time of and

 

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immediately after giving effect to such asset or Stock acquisition and the
making of any Advances in connection therewith, the Dollar Equivalent of Excess
Availability is not less than $25,000,000, (g) at least 30 days prior to such
acquisition, Administrative Agent shall have received a description of such
acquisition and such due diligence as is customarily required by Administrative
Agent, and projections for the succeeding three-year period, which projections
shall be in form and substance satisfactory to Administrative Agent and shall
take into account the proposed Permitted Acquisition, (h) at least 5 days prior
to the consummation of such asset or Stock acquisition, Administrative Agent has
received complete executed or conformed copies of the material documentation to
be executed in connection with such acquisition, (i) consents have been obtained
in favor of Agents and Lenders to the collateral assignment of rights and
indemnities under the material acquisition documents, and (j) to the extent
required pursuant to the provisions of Section 5.15, Collateral Agent shall have
received a perfected, first-priority Lien in the assets so acquired (except for
Permitted Liens) and in the case of a Stock acquisition, Collateral Agent shall
have received a perfected, first-priority Lien (except for Permitted Liens) in
all of the assets of the Target and the Target shall have, at Administrative
Agent’s election, either executed and delivered a joinder to this Agreement or a
Guaranty of all of the Obligations.

 

“Permitted Discretion” means a determination made in good faith and in the
exercise of reasonable (from the perspective of a secured asset-based lender)
business judgment.

 

“Permitted Dispositions” means (a) sales or other dispositions of Equipment or
fixtures that is surplus, substantially worn, damaged, uneconomic or obsolete in
the ordinary course of business, (b) sales of Inventory to buyers in the
ordinary course of business, (c) the use or disposition of money or Cash
Equivalents in a manner that is not prohibited by the terms of the Agreement or
the other Loan Documents, (d) the licensing, on a non-exclusive basis, of
patents, trademarks, copyrights, and other intellectual property rights in the
ordinary course of business, (e) dispositions of assets of a Loan Party or a
Significant Subsidiary in the aggregate Dollar Equivalent amount not to exceed
$1,000,000 in any fiscal year of Borrowers so long as the consideration received
therefor is at least fair market value (as determined in the good faith judgment
of the applicable Loan Party or Significant Subsidiary), (f) any leases or
subleases to other Persons that are not Affiliates of any Borrower not
materially interfering with the conduct of the business of the Borrowers taken
as a whole, (g) transactions between and among US Borrowers and transactions
between and among US Guarantors, (h) any sale and leaseback transaction which
(i) involves the financing of a tangible fixed asset not owned by any Borrower
or Significant Subsidiary as of the Closing Date, (ii) is consummated on
customary, market terms that have been negotiated on an arm’s-length basis with
a Person other than an Affiliate of any Borrower, (iii) to the extent the
applicable lease constitutes Indebtedness, constitutes Permitted Purchase Money
Indebtedness, (iv) involves Capital Expenditures that are permitted to be made
under Section 6.17(b) and (v) is consummated at a time when no Default or Event
of Default exists or would be caused by the consummation of such transaction,
(i) transactions between and among Foreign Borrowers, transactions between and
among Foreign Guarantors and dispositions by any Foreign Loan Party to any US
Borrower, (j) transactions between and

 

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among Significant Subsidiaries and dispositions by Significant Subsidiaries to
any Borrower or any Subsidiary of any Borrower, (k) (x) the asset sale described
in, and subject to the terms of, the Pre-approved Asset Disposition Letter and
(y) the transactions described in, and subject to the terms of, the Pre-approved
Restructurings Letter, (l) any disposition or series of related dispositions in
respect of Equipment where the Dollar Equivalent of the Net Cash Proceeds
received are less than or equal to $5,000 so long as the consideration received
therefor is at least fair market value (as determined in the good faith judgment
of the applicable Loan Party or Significant Subsidiary), (m) any other
dispositions in the aggregate Dollar Equivalent amount not to exceed $500,000 so
long as the consideration received therefor is at least fair market value (as
determined in the good faith judgment of the applicable Loan Party or
Significant Subsidiary) and at least 75% of the total consideration received is
in cash, (n) dispositions of fixed assets of a Loan Party or a Significant
Subsidiary to other Subsidiaries of Parent so long as the Dollar Equivalent
amount of the aggregate fair market value of all fixed assets disposed of in
reliance on this clause (n) does not exceed $2,000,000, and (o) the sale of all
or a substantial portion of the assets of Financial Insurance Services, Inc. or
the sale of all of the issued and outstanding capital stock of Financial
Insurance Services, Inc. (including by merger) so long as no Default or Event of
Default exists or would be caused by the consummation of such transaction.

 

“Permitted Holder” means State of Wisconsin Investment Board, James Lynch, Ida
Eggens Kruithof, Private Equity Investors IV, L.P., Rohit Desai, JANA Partners
and Heartland Advisors, Inc.

 

“Permitted Investments” means:

 

(a)                                  Investments in cash and Cash Equivalents,
including Excluded Deposit Accounts,

 

(B)                                 INVESTMENTS IN NEGOTIABLE INSTRUMENTS FOR
COLLECTION,

 

(C)                                  ADVANCES MADE IN CONNECTION WITH PURCHASES
OF GOODS OR SERVICES IN THE ORDINARY COURSE OF BUSINESS,

 

(D)                                 (I) ADVANCES MADE TO EMPLOYEES AND OFFICERS
IN THE ORDINARY COURSE OF BUSINESS FOR SALARY, RELOCATION AND OTHER SIMILAR
EXPENSES THE DOLLAR EQUIVALENT AMOUNT OF WHICH DO NOT EXCEED $750,000 IN THE
AGGREGATE AT ANY ONE TIME OUTSTANDING AND (II) INVESTMENTS IN RESPECT OF THE
CASH VALUE OF SPLIT PREMIUM INSURANCE POLICIES IN EFFECT ON THE CLOSING DATE
(AND RENEWALS THEREOF), SO LONG AS THE DOLLAR EQUIVALENT AMOUNT OF PREMIUMS
PAYABLE IN RESPECT OF SUCH POLICIES DOES NOT EXCEED $80,000 IN ANY FISCAL YEAR,

 

(E)                                  INVESTMENTS RECEIVED IN SETTLEMENT OF
AMOUNTS DUE TO A LOAN PARTY OR A SIGNIFICANT SUBSIDIARY EFFECTED IN THE ORDINARY
COURSE OF BUSINESS OR OWING TO A LOAN PARTY OR A SIGNIFICANT SUBSIDIARY AS A
RESULT OF INSOLVENCY PROCEEDINGS INVOLVING AN ACCOUNT DEBTOR OR UPON THE
FORECLOSURE OR ENFORCEMENT OF ANY LIEN IN FAVOR OF A BORROWER OR ANY SUBSIDIARY
OF A BORROWER,

 

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(F)                                    INVESTMENTS BY A LOAN PARTY OR A
SIGNIFICANT SUBSIDIARY, TO THE EXTENT EXISTING ON THE CLOSING DATE AND LISTED ON
SCHEDULE 6.12; PROVIDED, THAT NO US LOAN PARTY SHALL WRITE-OFF, FORGIVE,
OTHERWISE REDUCE OR ACCEPT PAYMENT WITH RESPECT TO THE UNPAID PRINCIPAL AMOUNT
OF ANY INTERCOMPANY LOAN OWED BY A FOREIGN SUBSIDIARY WITHOUT THE PRIOR WRITTEN
CONSENT OF ADMINISTRATIVE AGENT EXCEPT PERMITTED REPAYMENTS,

 

(G)                                 INVESTMENTS IN RESPECT OF INTERCOMPANY LOANS
MADE BY FOREIGN SUBSIDIARIES (OTHER THAN SITEL IBERICA TELESERVICES, S.A.) TO
OTHER FOREIGN SUBSIDIARIES; PROVIDED, THAT (X) THE AGGREGATE DOLLAR EQUIVALENT
PRINCIPAL AMOUNT OF SUCH INTERCOMPANY LOANS MADE IN RELIANCE ON THIS CLAUSE
(G) (OTHER THAN (I) INTERCOMPANY LOANS MADE WITH PROCEEDS OF INVESTMENTS MADE BY
SITEL IBERICA TELESERVICES, S.A. PURSUANT TO CLAUSE (L) OF THIS DEFINITION AND
(II) INTERCOMPANY LOANS MADE BY A FOREIGN SUBSIDIARY WITH THE PROCEEDS OF
INTERCOMPANY LOANS MADE BY ANOTHER FOREIGN SUBSIDIARY PURSUANT TO THIS CLAUSE
(G) TO THE EXTENT THE APPLICABLE CASH PROCEEDS OF SUCH INTERCOMPANY LOANS ARE
SENT DIRECTLY BY THE FOREIGN SUBSIDIARY FUNDING THE INITIAL INTERCOMPANY LOAN TO
THE FOREIGN SUBSIDIARY THAT IS THE ULTIMATE RECIPIENT OF SUCH SERIES OF
INTERCOMPANY LOANS) DOES NOT EXCEED $2,500,000 AT ANY ONE TIME OUTSTANDING AND
(Y) SUCH INTERCOMPANY LOANS ARE UNSECURED,

 

(H)                                 INVESTMENTS IN RESPECT OF INTERCOMPANY LOANS
MADE BY US LOAN PARTIES TO FOREIGN SUBSIDIARIES; PROVIDED, THAT (I) (A) TO THE
EXTENT THE PROCEEDS OF SUCH INTERCOMPANY LOANS ARE USED TO FINANCE CAPITAL
EXPENDITURES INCURRED IN CONNECTION WITH THE REPAIR, RESTORATION OR ACQUISITION
OF REVENUE GENERATING ASSETS, THE AGGREGATE DOLLAR EQUIVALENT PRINCIPAL AMOUNT
OF SUCH INTERCOMPANY LOANS (X) MADE TO FOREIGN SUBSIDIARIES ORGANIZED UNDER THE
LAWS OF ANY SINGLE JURISDICTION MADE IN RELIANCE ON THIS CLAUSE (H) SHALL NOT
EXCEED $7,500,000 IN ANY FISCAL YEAR (NET OF REPAYMENTS OF INTERCOMPANY LOANS
MADE IN SUCH FISCAL YEAR BY FOREIGN SUBSIDIARIES ORGANIZED UNDER THE LAWS OF
SUCH JURISDICTION TO LOAN PARTIES) OR (Y) MADE TO ALL FOREIGN SUBSIDIARIES IN
RELIANCE ON THIS CLAUSE (H) SHALL NOT EXCEED $50,000,000 DURING THE TERM OF THIS
AGREEMENT, (B) TO THE EXTENT THE PROCEEDS OF SUCH INTERCOMPANY LOANS ARE USED TO
FINANCE START UP OR EXPANSION COSTS OF A FOREIGN SUBSIDIARY OTHER THAN AS
DESCRIBED IN CLAUSE (I)(A) ABOVE, THE AGGREGATE DOLLAR EQUIVALENT PRINCIPAL
AMOUNT OF SUCH INTERCOMPANY LOANS MADE TO FOREIGN SUBSIDIARIES IN RELIANCE ON
THIS CLAUSE (H) SHALL NOT EXCEED $2,500,000 IN ANY FISCAL YEAR AND (C) TO THE
EXTENT THE PROCEEDS OF SUCH INTERCOMPANY LOANS ARE USED FOR PURPOSES OTHER THAN
AS DESCRIBED IN CLAUSE (I)(A) OR (I)(B) ABOVE, THE AGGREGATE DOLLAR EQUIVALENT
PRINCIPAL AMOUNT OF SUCH INTERCOMPANY LOANS MADE TO FOREIGN SUBSIDIARIES IN
RELIANCE ON THIS CLAUSE (H) SHALL NOT EXCEED $7,500,000 AT ANY ONE TIME
OUTSTANDING, (II) THE AGGREGATE PRINCIPAL AMOUNT OF SUCH INTERCOMPANY LOANS MADE
IN RELIANCE ON CLAUSE (H)(I)(A) IN ANY FISCAL YEAR SHALL NOT EXCEED 75% OF THE
CAPITAL EXPENDITURE LIMIT SET FORTH IN SECTION 6.17(B) WITH RESPECT TO SUCH
FISCAL YEAR, (III) SUCH INTERCOMPANY LOANS ARE EVIDENCED BY PROMISSORY NOTES, IN
FORM AND SUBSTANCE ACCEPTABLE TO COLLATERAL AGENT, WHICH PROMISSORY NOTES HAVE
BEEN PLEDGED TO COLLATERAL AGENT, (IV) NO US LOAN PARTY SHALL WRITE-OFF,
FORGIVE, OTHERWISE REDUCE OR ACCEPT PAYMENT WITH RESPECT TO THE UNPAID PRINCIPAL
AMOUNT OF ANY SUCH INTERCOMPANY LOAN WITHOUT THE PRIOR WRITTEN CONSENT OF
ADMINISTRATIVE AGENT EXCEPT PERMITTED REPAYMENTS, (V) TO THE EXTENT THE
AGGREGATE DOLLAR EQUIVALENT PRINCIPAL AMOUNT OF SUCH INTERCOMPANY LOANS MADE TO
FOREIGN SUBSIDIARIES ORGANIZED UNDER THE LAWS OF ANY SINGLE JURISDICTION MADE IN
RELIANCE ON THIS CLAUSE (H)

 

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EXCEEDS $1,000,000 AT ANY ONE TIME OUTSTANDING, ADMINISTRATIVE BORROWER SHALL
NOTIFY ADMINISTRATIVE AGENT OF THE EXISTENCE OF SUCH INTERCOMPANY LOANS AND
WITHIN 45 DAYS OF THE REQUEST OF ADMINISTRATIVE AGENT (OR SUCH LATER PERIOD
REASONABLY ACCEPTABLE TO ADMINISTRATIVE AGENT), SUCH INTERCOMPANY LOANS SHALL BE
SECURED BY THE ASSETS OF SUCH FOREIGN SUBSIDIARY PURSUANT TO DOCUMENTATION IN
FORM AND SUBSTANCE REASONABLY SATISFACTORY TO ADMINISTRATIVE AGENT EXCEPT TO THE
EXTENT IT IS NOT POSSIBLE UNDER APPLICABLE LAW THROUGH THE USE OF EFFORTS AND
EXPENDITURES THAT ARE NOT UNDULY ONEROUS TO THE BORROWERS IN RELATION TO THE
BENEFITS AFFORDED TO THE ADMINISTRATIVE AGENT AND THE LENDERS THEREBY, AS
REASONABLY DETERMINED BY THE ADMINISTRATIVE AGENT, TO OBTAIN VALID AND
ENFORCEABLE LIENS ON THE ASSETS OF SUCH FOREIGN SUBSIDIARY, AND (VI) THE
AGGREGATE DOLLAR EQUIVALENT PRINCIPAL AMOUNT OF SUCH INTERCOMPANY LOANS MADE IN
ANY FISCAL YEAR TO FOREIGN SUBSIDIARIES ORGANIZED UNDER THE LAWS OF
(A) JURISDICTIONS IN WHICH IT IS NOT POSSIBLE TO OBTAIN VALID AND ENFORCEABLE
LIENS ON SUCH ASSETS OF A FOREIGN SUBSIDIARY UNDER APPLICABLE LAW THROUGH THE
USE OF EFFORTS AND EXPENDITURES THAT ARE NOT UNDULY ONEROUS TO THE BORROWERS IN
RELATION TO THE BENEFITS AFFORDED TO THE ADMINISTRATIVE AGENT AND THE LENDERS
THEREBY, AS REASONABLY DETERMINED BY THE ADMINISTRATIVE AGENT, AND
(B) JURISDICTIONS IN WHICH INTERCOMPANY LOANS MADE TO FOREIGN SUBSIDIARIES
ORGANIZED UNDER THE LAWS OF ANY SUCH JURISDICTION MADE IN RELIANCE ON THIS
CLAUSE (H) EXCEED $1,000,000 AT ANY ONE TIME OUTSTANDING AND ADMINISTRATIVE
AGENT DOES NOT REQUEST THAT SUCH INTERCOMPANY LOANS BE SECURED BY THE ASSETS OF
SUCH FOREIGN SUBSIDIARIES IN RELIANCE ON THIS CLAUSE (H), SHALL NOT EXCEED
$10,000,000,

 

(I)                                     INVESTMENTS CONSISTING OF OTHER
INTERCOMPANY LOANS AND ADVANCES MADE IN COMPLIANCE WITH SECTION 6.1 (OTHER THAN
CLAUSE (J) THEREOF) OF THE AGREEMENT,

 

(J)                                     INVESTMENTS BY ANY US BORROWER IN
ANOTHER US BORROWER AND INVESTMENTS BY ANY US GUARANTOR IN ANOTHER US LOAN
PARTY,

 

(K)                                  PERMITTED ACQUISITIONS,

 

(L)                                     INVESTMENTS BY SITEL IBERICA
TELESERVICES, S.A. IN FOREIGN SUBSIDIARIES,

 

(M)                               INVESTMENTS IN HEDGE AGREEMENTS PERMITTED BY
SECTION 6.1,

 

(N)                                 INVESTMENTS BY LOAN PARTIES AND SIGNIFICANT
SUBSIDIARIES IN SUBSIDIARIES OF PARENT ARISING IN CONNECTION WITH THE ISSUANCE
OF EQUITY IN SATISFACTION OF INTERCOMPANY LOANS OWED TO SUCH LOAN PARTIES OR
SIGNIFICANT SUBSIDIARIES SO LONG AS (I) THE AGGREGATE DOLLAR EQUIVALENT OF SUCH
INTERCOMPANY LOANS THAT ARE SO SATISFIED PLUS THE DOLLAR EQUIVALENT OF
INTERCOMPANY LOANS CONVERTED TO EQUITY PURSUANT TO A PERMITTED REPAYMENT DOES
NOT EXCEED $5,000,000 IN ANY FISCAL YEAR OR $10,000,000 DURING THE TERM OF THIS
AGREEMENT AND (II) AT THE TIME OF SUCH ISSUANCE NO DEFAULT OR EVENT OF DEFAULT
EXISTS OR WOULD BE CAUSED BY SUCH ISSUANCE,

 

(O)                                 NON-CASH CONSIDERATION RECEIVED BY ANY LOAN
PARTY OR SIGNIFICANT SUBSIDIARY PURSUANT TO A PERMITTED DISPOSITION,

 

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(P)                                 GUARANTEES OF INDEBTEDNESS PERMITTED UNDER
SECTION 6.1 AND GUARANTEES OF ORDINARY COURSE OBLIGATIONS OF SUBSIDIARIES OF
PARENT NOT CONSTITUTING INDEBTEDNESS,

 

(Q)                                 TRANSACTIONS PERMITTED BY SECTIONS 6.3 AND
6.10,

 

(R)                                    INVESTMENTS IN JOINT VENTURES (AND SOLELY
FOR PURPOSES THEREOF, IN ANY INTERMEDIATE HOLDING COMPANY) TO THE EXTENT THE
PROCEEDS OF SUCH INVESTMENTS ARE USED TO FINANCE CAPITAL EXPENDITURES INCURRED
IN CONNECTION WITH THE REPAIR, RESTORATION OR ACQUISITION OF REVENUE GENERATING
ASSETS AND ASSOCIATED WORKING CAPITAL IN AN AGGREGATE DOLLAR EQUIVALENT AMOUNT
NOT TO EXCEED THE LESSER OF (X) $15,000,000 IN ANY FISCAL YEAR; PROVIDED, THAT,
IN NO EVENT SHALL THE AGGREGATE DOLLAR EQUIVALENT AMOUNT OF INVESTMENTS MADE IN
RELIANCE ON THIS CLAUSE (R) THAT ARE USED TO FINANCE WORKING CAPITAL EXCEED
$2,000,000 IN ANY FISCAL YEAR, AND (Y) THE THEN REMAINING AMOUNT OF CAPITAL
EXPENDITURES PERMITTED TO BE MADE UNDER SECTION 6.17(B) IN SUCH FISCAL YEAR,

 

(S)                                  INVESTMENTS IN FOREIGN SUBSIDIARIES SOLELY
TO THE EXTENT SUCH INVESTMENTS (I) ARE NECESSARY FOR SUCH FOREIGN SUBSIDIARY TO
BE IN COMPLIANCE WITH MINIMUM CAPITALIZATION REQUIREMENTS UNDER APPLICABLE LAW
OR ARE NECESSARY FOR SUCH FOREIGN SUBSIDIARY TO BE IN COMPLIANCE WITH MINIMUM
CAPITALIZATION REQUIREMENTS ESTABLISHED BY THE APPLICABLE TAX AUTHORITIES AS A
CONDITION TO SUCH FOREIGN SUBSIDIARY DEDUCTING INTEREST EXPENSE ON INTERCOMPANY
LOANS, OR (II) ARE NECESSARY TO PERMIT SUCH FOREIGN SUBSIDIARY TO MAKE
INVESTMENTS IN ANOTHER FOREIGN SUBSIDIARY FOR SUCH OTHER FOREIGN SUBSIDIARY TO
BE IN COMPLIANCE WITH MINIMUM CAPITALIZATION REQUIREMENTS UNDER APPLICABLE LAW
OR ARE NECESSARY FOR SUCH OTHER FOREIGN SUBSIDIARY TO BE IN COMPLIANCE WITH
MINIMUM CAPITALIZATION REQUIREMENTS ESTABLISHED BY THE APPLICABLE TAX
AUTHORITIES AS A CONDITION TO SUCH OTHER FOREIGN SUBSIDIARY DEDUCTING INTEREST
EXPENSE ON INTERCOMPANY LOANS; PROVIDED, THAT THE AGGREGATE DOLLAR EQUIVALENT
AMOUNT OF SUCH INVESTMENTS MADE IN RELIANCE ON THIS CLAUSE (S) DO NOT EXCEED
$5,000,000 DURING THE TERM OF THIS AGREEMENT (IT BEING UNDERSTOOD, THAT FOR
PURPOSES OF DETERMINING THE AGGREGATE AMOUNT OF INVESTMENTS MADE IN RELIANCE ON
THIS CLAUSE (S), AN INVESTMENT MADE TO A FOREIGN SUBSIDIARY IN RELIANCE ON
CLAUSE (II) OF THIS CLAUSE (S) THAT IS USED TO MAKE AN INVESTMENT IN RELIANCE ON
CLAUSE (I) OF THIS CLAUSE (S) SHALL BE TREATED AS A SINGLE INVESTMENT); AND

 

(T)                                    OTHER INVESTMENTS WHICH DO NOT EXCEED
$2,500,000 IN THE AGGREGATE DOLLAR EQUIVALENT AMOUNT DURING ANY FISCAL YEAR OF
PARENT.

 

“Permitted Liens” means (a) Liens held by Collateral Agent to secure the
Obligations, (b) Liens for unpaid taxes, assessments, or other governmental
charges or levies that either (i) are not yet delinquent, or (ii) do not have
priority over the Agent’s Liens and the underlying taxes, assessments, or
charges or levies are the subject of Permitted Protests, (c) judgment Liens that
do not constitute an Event of Default under Section 7.7 of the Agreement,
(d) Liens set forth on Schedule P-1, (e) the interests of lessors under
operating leases, (f) purchase money Liens or the interests of lessors under
Capital Leases to the extent that such Liens or interests secure Permitted
Purchase Money Indebtedness and so long as such Lien attaches only to the asset
purchased, acquired, constructed or improved and the proceeds thereof, (g) Liens
arising by operation of law in favor of warehousemen, landlords,

 

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carriers, mechanics, materialmen, laborers, or suppliers, incurred in the
ordinary course of Loan Parties’ or Significant Subsidiaries’ business and not
in connection with the borrowing of money, and which Liens either (i) are for
sums not yet delinquent, or (ii) are the subject of Permitted Protests,
(h) Liens on amounts deposited in connection with obtaining worker’s
compensation or other unemployment insurance, (i) Liens on amounts deposited in
the ordinary course of business in connection with bids, tenders, sales
contracts, leases and other contractual obligations, statutory obligations,
regulatory obligations, work in progress advances and other similar obligations
not incurred in connection with the borrowing of money, (j) Liens on amounts
deposited as security for surety or appeal bonds in connection with obtaining
such bonds in the ordinary course of business, (k) with respect to any real
property, reservations, exceptions, encroachments, easements, rights-of-way,
covenants, conditions, and zoning and other land use restrictions, leases and
other title exceptions that do not materially interfere with or impair the use
or operation thereof, (l) customary netting and setoff rights, banker’s liens
and the like in favor of financial institutions, (m) Liens on the assets of the
US Loan Parties securing the Term B Debt, (n) Liens incurred in connection with
a sale and leaseback transaction that is permitted under Section 6.4, so long as
any such Lien covers only the assets that are the subject of such sale and
leaseback transaction, (o) any license, lease or sublease to a third party not
interfering in any material respect with the business of the US Borrowers, taken
as a whole, or the Borrowers, taken as a whole, (p) Liens on fixed assets
securing acquired Indebtedness permitted by Section 6.1 in connection with an
acquisition permitted by Section 6.12 or pursuant to an investment permitted
hereby so long as such Lien covers only the assets purchased or acquired and the
proceeds thereof and secures only such acquired Indebtedness, (q) other Liens on
fixed assets, cash and Cash Equivalents securing obligations in an aggregate
amount not exceeding $2,000,000, (r) Liens on cash and Cash Equivalents securing
obligations owing under Hedge Agreements permitted by this Agreement, (s) Liens
on assets (other than Collateral) of Loan Parties and Significant Subsidiaries
securing the Additional Permitted Debt, (t) Liens on the assets of the
Significant Subsidiaries securing Indebtedness permitted under Sections 6.1(l),
(u) Liens on the assets of Foreign Subsidiaries securing intercompany loans due
to any US Loan Party that have been pledged to Collateral Agent and (v) Liens
that are replacements of Permitted Liens to the extent that the original
Indebtedness is refinanced, renewed, or extended under Section 6.1(d) and so
long as the replacement Liens only encumber those assets that secured the
refinanced, renewed, or extended Indebtedness.

 

“Permitted Protest” means the right of Administrative Borrower or any of its
Subsidiaries to protest any Lien (other than any Lien that secures the
Obligations), taxes, assessments, charges or levies (other than payroll taxes or
taxes that are the subject of a United States federal tax lien), or rental
payment, provided that (a) a reserve with respect to such obligation is
established on a Borrower’s or any of its Subsidiaries’ books and records in
such amount as is required under GAAP, (b) any such protest is instituted
promptly and prosecuted diligently by Administrative Borrower or any of its
Subsidiaries, as applicable, in good faith, and (c) Administrative Agent is
satisfied that, while any such protest is pending, there will be no impairment
of the enforceability, validity, or priority of any of the Agent’s Liens.

 

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“Permitted Purchase Money Indebtedness” means, as of any date of determination,
Purchase Money Indebtedness (i) at any time on or prior to December 31, 2005, in
an aggregate Dollar Equivalent principal amount outstanding at any one time not
in excess of $15,000,000, (ii) at any time after December 31, 2005 and on or
prior to December 31, 2006, in an aggregate Dollar Equivalent principal amount
outstanding at any one time not in excess of $20,000,000, and (iii) at any time
after December 31, 2006, in an aggregate Dollar Equivalent principal amount
outstanding at any one time not in excess of $25,000,000.

 

“Permitted Repayments” means (A) payments on intercompany loans made by US Loan
Parties to Foreign Subsidiaries to the extent such payments are used to make the
mandatory prepayments due under Section 2.4(c)(i), (B) payments on intercompany
loans made by US Loan Parties to Foreign Subsidiaries to the extent the Dollar
Equivalent amount of all payments on such intercompany loans made in reliance on
this clause (B) does not exceed $2,500,000 in any fiscal year and (C) the
conversion of intercompany loans made by US Loan Parties to Foreign Subsidiaries
to equity in the applicable Foreign Subsidiary to the extent the aggregate
Dollar Equivalent amount of such intercompany loans converted to equity does not
exceed $5,000,000 in any fiscal year or $10,000,000 during the term of this
Agreement.

 

“Person” means natural persons, corporations, limited liability companies,
limited partnerships, general partnerships, limited liability partnerships,
joint ventures, trusts, land trusts, business trusts, or other organizations,
irrespective of whether they are legal entities, and governments and agencies
and political subdivisions thereof.

 

“PPSA” means the Personal Property Security Act of the applicable Canadian
province or provinces in respect of Canadian Borrowers, and in the Province of
Quebec, means the applicable provisions of the Civil Code of Quebec.

 

“Pre-approved Asset Disposition Letter” means the letter of even date herewith
among Administrative Borrower, Lenders and Administrative Agent pursuant to
which Administrative Agent and Lenders have consented to a specific asset sale
pursuant to the terms of such letter.

 

“Pre-approved Restructurings Letter” means the letter of even date herewith
among Administrative Borrower, Lenders, Term B Agent and Administrative Agent
pursuant to which Administrative Agent, Term B Agent and Lenders have consented
to certain proposed restructurings pursuant to the terms of such letter.

 

“Projections” means Parent’s consolidated forecasted (a) balance sheets,
(b) profit and loss statements, and (c) cash flow statements, all prepared on a
basis consistent with Parent’s historical financial statements, together with
appropriate supporting details and a statement of underlying assumptions.

 

“Pro Rata Share” means, as of any date of determination:

 

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(a)                                  with respect to a Lender’s obligation to
make US Advances and right to receive payments of principal, interest, fees,
costs, and expenses with respect thereto, (i) prior to the US Revolver
Commitments being terminated or reduced to zero, the percentage obtained by
dividing (y) such Lender’s US Revolver Commitment, by (z) the aggregate US
Revolver Commitments of all Lenders, and (ii) from and after the time that the
US Revolver Commitments have been terminated or reduced to zero, the percentage
obtained by dividing (y) the Dollar Equivalent of the aggregate outstanding
principal amount of such Lender’s US Advances by (z) the Dollar Equivalent of
the aggregate outstanding principal amount of all US Advances,

 

(b)                                 with respect to a Lender’s obligation to
make Canadian Advances and right to receive payments of principal, interest,
fees, costs, and expenses with respect thereto, (i) prior to the Canadian
Revolver Commitments being terminated or reduced to zero, the percentage
obtained by dividing (y) such Lender’s Canadian Revolver Commitment, by (z) the
aggregate Canadian Revolver Commitments of all Lenders, and (ii) from and after
the time that the Canadian Revolver Commitments have been terminated or reduced
to zero, the percentage obtained by dividing (y) the Dollar Equivalent of the
aggregate outstanding principal amount of such Lender’s Canadian Advances by
(z) the Dollar Equivalent of the aggregate outstanding principal amount of all
Canadian Advances,

 

(c)                                  with respect to a Lender’s obligation to
make European Advances and right to receive payments of principal, interest,
fees, costs, and expenses with respect thereto, (i) prior to the European
Revolver Commitments being terminated or reduced to zero, the percentage
obtained by dividing (y) such Lender’s European Revolver Commitment, by (z) the
aggregate European Revolver Commitments of all Lenders, and (ii) from and after
the time that the European Revolver Commitments have been terminated or reduced
to zero, the percentage obtained by dividing (y) the Dollar Equivalent of the
aggregate outstanding principal amount of such Lender’s European Advances by
(z) the Dollar Equivalent of the aggregate outstanding principal amount of all
European Advances,

 

(d)                                 with respect to a Lender’s obligation to
participate in US Letters of Credit, to reimburse the US Issuing Lender, and
right to receive payments of fees with respect thereto, (i) prior to the US
Revolver Commitments being terminated or reduced to zero, the percentage
obtained by dividing (y) such Lender’s US Revolver Commitment, by (z) the
aggregate US Revolver Commitments of all Lenders, and (ii) from and after the
time that the US Revolver Commitments have been terminated or reduced to zero,
the percentage obtained by dividing (y) the Dollar Equivalent of the aggregate
outstanding principal amount of such Lender’s US Advances by (z) the Dollar
Equivalent of the aggregate outstanding principal amount of all US Advances,

 

(e)                                  with respect to a Lender’s obligation to
participate in Canadian Letters of Credit, to reimburse the Canadian Issuing
Lender, and right to receive payments of fees with respect thereto, (i) prior to
the Canadian Revolver Commitments being terminated or reduced to zero, the
percentage obtained by dividing (y) such Lender’s Canadian Revolver Commitment,
by (z) the aggregate Canadian Revolver Commitments of all Lenders, and (ii) from
and after the time that the Canadian Revolver Commitments have been terminated

 

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or reduced to zero, the percentage obtained by dividing (y) the Dollar
Equivalent of the aggregate outstanding principal amount of such Lender’s
Canadian Advances by (z) the Dollar Equivalent of the aggregate outstanding
principal amount of all Canadian Advances,

 

(f)                                    with respect to a Lender’s obligation to
participate in European Letters of Credit, to reimburse the European Issuing
Lender, and right to receive payments of fees with respect thereto, (i) prior to
the European Revolver Commitments being terminated or reduced to zero, the
percentage obtained by dividing (y) such Lender’s European Revolver Commitment,
by (z) the aggregate European Revolver Commitments of all Lenders, and (ii) from
and after the time that the European Revolver Commitments have been terminated
or reduced to zero, the percentage obtained by dividing (y) the Dollar
Equivalent of the aggregate outstanding principal amount of such Lender’s
European Advances by (z) the Dollar Equivalent of the aggregate outstanding
principal amount of all European Advances,

 

(g)                                 with respect to a Lender’s obligation to
make the Term Loan A and right to receive payments of interest, fees, and
principal with respect thereto, (i) prior to the making of the Term Loan A, the
percentage obtained by dividing (y) such Lender’s Term Loan A Commitment, by
(z) the aggregate amount of all Lenders’ Term Loan A Commitments, and (ii) from
and after the making of the Term Loan A, the percentage obtained by dividing
(y) the principal amount of such Lender’s portion of the Term Loan A by (z) the
principal amount of the Term Loan A, and

 

(h)                                 with respect to all other matters as to a
particular Lender (including the indemnification obligations arising under
Section 15.7), the percentage obtained by dividing (i) such Lender’s Revolver
Commitment plus the outstanding principal amount of such Lender’s portion of the
Term Loan A (or, prior to the making of the Term Loan A, such Lender’s Term Loan
A Commitment), by (ii) the aggregate amount of Revolver Commitments of all
Lenders plus the outstanding principal amount of the Term Loan A (or, prior to
the making of the Term Loan A, the aggregate amount of all Lenders’ Term Loan A
Commitments); provided, however, that in the event the Revolver Commitments have
been terminated or reduced to zero, Pro Rata Share under this clause shall be
the percentage obtained by dividing (A) the Dollar Equivalent of the outstanding
principal amount of such Lender’s Advances plus such Lender’s ratable portion of
the Risk Participation Liability with respect to outstanding Letters of Credit
plus the outstanding principal amount of such Lender’s portion of the Term Loan
A (or, prior to the making of the Term Loan A, such Lender’s Term Loan A
Commitment), by (B) the Dollar Equivalent of the outstanding principal amount of
all Advances plus the aggregate amount of the Risk Participation Liability with
respect to outstanding Letters of Credit plus the outstanding principal amount
of the Term Loan A (or, prior to the making of the Term Loan A, the aggregate
amount of all Lenders’ Term Loan A Commitments).

 

“Protective Advances” means US Protective Advances, Canadian Protective Advances
or European Protective Advances, as applicable.

 

“Purchase Money Indebtedness” means Indebtedness (other than the Obligations,
but including Capitalized Lease Obligations), incurred at the time of, or within

 

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45 days prior to or after, the acquisition, construction or improvement of any
fixed assets for the purpose of financing all or any part of the acquisition,
construction or improvement cost thereof or any refinancings thereof.

 

“Qualified Cash” means, as of any date of determination, the amount of
unrestricted cash and Cash Equivalents of Borrowers that is in Deposit Accounts
or in Securities Accounts, or any combination thereof, and which such Deposit
Account or Securities Account is the subject of a Control Agreement and is
maintained by a branch office of a bank or securities intermediary located
within the United States.

 

“Real Property” means the parcels of owned real property identified on
Schedule R-1 and any other parcels of owned real property hereafter acquired by
any US Borrower and the improvements thereto.

 

“Real Property Collateral” means any Real Property hereafter acquired by a US
Borrower which is required pursuant to Section 5.15 to be subject to a Mortgage.

 

“Record” means information that is inscribed on a tangible medium or which is
stored in an electronic or other medium and is retrievable in perceivable form.

 

“Reference Bank” means Wells Fargo, or such other bank as Administrative Agent
may from time to time designate.

 

“Remedial Action” means all actions taken to (a) clean up, remove, remediate,
contain, treat, monitor, assess, evaluate, or in any way address Hazardous
Materials in the indoor or outdoor environment, (b) prevent or minimize a
release or threatened release of Hazardous Materials so they do not migrate or
endanger or threaten to endanger public health or welfare or the indoor or
outdoor environment, (c) restore or reclaim natural resources or the
environment, (d) perform any pre-remedial studies, investigations, or
post-remedial operation and maintenance activities, or (e) conduct any other
actions with respect to Hazardous Materials authorized by Environmental Laws.

 

“Replacement Lender” has the meaning specified therefor in Section 14.2(a).

 

“Report” has the meaning specified therefor in Section 15.17.

 

“Required Availability” means that the Dollar Equivalent of Excess Availability
exceeds $10,000,000.

 

“Required Lenders” means at any time, Lenders whose Pro Rata Shares of (a) the
Revolver Commitment (or, if the Revolver Commitment has been terminated or
reduced to zero, the then outstanding Revolver Usage) and (b) the outstanding
principal amount of the Term Loan A (or, prior to the making of the Term Loan A,
the aggregate amount of all Lenders’ Term Loan A Commitments), aggregate at
least 50.1%.

 

“Reserve Percentage” means, on any day, for any Lender, the maximum percentage
prescribed by the Board of Governors of the Federal Reserve System (or any

 

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successor Governmental Authority) for determining the reserve requirements
(including any basic, supplemental, marginal, or emergency reserves) that are in
effect on such date with respect to eurocurrency funding (currently referred to
as “eurocurrency liabilities”) of that Lender, but so long as such Lender is not
required or directed under applicable regulations to maintain such reserves, the
Reserve Percentage shall be zero.

 

“Revolver Commitment” means, with respect to each Lender, its US Revolver
Commitment, its Canadian Revolver Commitment or European Revolver Commitment, as
the context requires, and, with respect to all Lenders, their US Revolver
Commitments, Canadian Revolver Commitments or European Revolver Commitments, as
the context requires, in each case as such Dollar amounts are set forth beside
such Lender’s name under the applicable heading on Schedule C-1 or in the
Assignment and Acceptance pursuant to which such Lender became a Lender
hereunder, as such amounts may be reduced or increased from time to time
pursuant to assignments made in accordance with the provisions of Section 13.1.

 

“Revolver Usage” means, as of any date of determination, the sum of (a) the
Dollar Equivalent of the principal amount of outstanding Advances, plus (b) the
amount of the Letter of Credit Usage, in each case as determined as of such
date.

 

“Risk Participation Liability” means, as to each Letter of Credit, all
reimbursement obligations of Borrowers to an Issuing Lender with respect to a
Canadian L/C Undertaking, a European L/C Undertaking or a US L/C Undertaking,
consisting of (a) the amount available to be drawn or which may become available
to be drawn, (b) all amounts that have been paid by an Issuing Lender to an
Underlying Issuer to the extent not reimbursed by Borrowers, whether by the
making of an Advance or otherwise, and (c) all accrued and unpaid interest,
fees, and expenses payable with respect thereto.

 

“SEC” means the United States Securities and Exchange Commission and any
successor thereto.

 

“Securities Account” means a “securities account” (as that term is defined in
the Code).

 

“Security Agreement” means the US Security Agreement and each other security
agreement (including, without limitation, pledge agreements), in form and
substance satisfactory to Collateral Agent, executed and delivered by each
Borrower to Collateral Agent.

 

“Settlement” has the meaning specified therefor in Section 2.3(e)(i).

 

“Settlement Date” has the meaning specified therefor in Section 2.3(e)(i).

 

“Significant Subsidiary” means SITEL Iberica Teleservices, S.A. and each other
Subsidiary of Parent that is not a Loan Party, an Immaterial Subsidiary or a
Non-Loan Party Subsidiary.  The Significant Subsidiaries on the Closing Date are
identified on Schedule S-1.

 

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“Solvent” means, with respect to any Person on a particular date, that, at fair
valuations, the sum of such Person’s assets is greater than all of such Person’s
debts or, with respect to a Canadian Borrower, is not an “insolvent person” (as
such term is defined in the Bankruptcy and Insolvency Act (Canada) or a “debtor
company” (as defined in the Companies Creditors Arrangement Act (Canada)).

 

“Specified Account Debtors” means the Account Debtors identified in that certain
letter of even date herewith among Administrative Borrower, Lenders, and
Administrative Agent pursuant to which Administrative Agent and Lenders have
consented to the designation of such Account Debtors as Specified Account
Debtors.

 

“Statutory Lien Payments” has the meaning set forth in Section 4.20.

 

“Sterling” means the lawful currency of the United Kingdom.

 

“Stock” means all shares, options, warrants, interests, participations, share
capital or other equivalents (regardless of how designated) of or in a Person,
whether voting or nonvoting, including common stock, preferred stock, or any
other “equity security” (as such term is defined in Rule 3a11-1 of the General
Rules and Regulations promulgated by the SEC under the Exchange Act).

 

“Subsidiary” of a Person means a corporation, partnership, limited liability
company, or other entity in which that Person directly or indirectly owns or
controls the shares of Stock having ordinary voting power to elect a majority of
the board of directors (or appoint other comparable managers) of such
corporation, partnership, limited liability company, or other entity.

 

“Swing Lenders” means US Swing Lender, European Swing Lender and Canadian Swing
Lender.

 

“Swing Loan” means a US Swing Loan, European Swing Loan or a Canadian Swing
Loan.

 

“Target” has the meaning given to it in the definition of “Permitted
Acquisition.”

 

“Taxes” has the meaning specified therefor in Section 15.11.

 

“Term B Agent” means Ableco Finance LLC, as agent for the lenders under the Term
B Debt Documents (and its successors and assigns).

 

“Term B Credit Agreement” means that certain Credit Agreement dated as of the
date hereof among Parent and each of Parent’s Subsidiaries identified on the
signature pages thereto and that from time to time become parties thereto, as
borrowers, the lenders party thereto as lenders, and Term B Agent, as amended,
modified, supplemented, restated, or renewed in accordance with the terms
thereof and the terms of this Agreement.

 

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“Term B Debt” means the Indebtedness of US Loan Parties in a maximum principal
amount of $35,000,000 plus protective advances (and capitalized interest, fees,
costs and other amounts) incurred pursuant to the terms of the Term B Debt
Documents.

 

“Term B Debt Documents” means the Term B Credit Agreement and the other “Loan
Documents” as such term is defined in the Term B Credit Agreement, in each case,
as amended, amended and restated, supplemented, or modified in accordance with
the terms hereof.

 

“Term Loan A” has the meaning set forth in Section 2.2(a).

 

“Term Loan A Amount” means $20,000,000.

 

“Term Loan A Commitment” means, with respect to each Lender, its Term Loan A
Commitment, and, with respect to all Lenders, their Term Loan A Commitments, in
each case as such Dollar amounts are set forth beside such Lender’s name under
the applicable heading on Schedule C-1 or in the Assignment and Acceptance
pursuant to which such Lender became a Lender hereunder, as such amounts may be
reduced or increased from time to time pursuant to assignments made in
accordance with the provisions of Section 13.1.

 

“Total Commitment” means, with respect to each Lender, its Total Commitment,
and, with respect to all Lenders, their Total Commitments, in each case as such
Dollar amounts are set forth beside such Lender’s name under the applicable
heading on Schedule C-1 attached hereto or on the signature page of the
Assignment and Acceptance pursuant to which such Lender became a Lender
hereunder, as such amounts may be reduced or increased from time to time
pursuant to assignments made in accordance with the provisions of Section 13.1.

 

“UK Borrowers” means SITEL UK Limited and SITEL Europe Limited and each other
Subsidiary of Parent created or organized under the laws of United Kingdom or
any state or province thereof that becomes a Borrower hereunder pursuant to
Section 5.15, and “UK Borrower” means any one of them.

 

“Underlying Issuer” means a US Underlying Issuer, a Canadian Underlying Issuer
or a European Underlying Issuer, as the case may be.

 

“Underlying Letter of Credit” means a US Underlying Letter of Credit, a Canadian
Underlying Letter of Credit or a European Underlying Letter of Credit, as the
case may be.

 

“United States” means the United States of America.

 

“US Advances” has the meaning specified therefor in Section 2.1(a).

 

“US Availability” means, as of any date of determination, the amount that US
Borrowers are entitled to borrow as US Advances hereunder (after giving effect
to all then outstanding US Revolver Usage and all sublimits and reserves then
applicable hereunder).

 

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“US Base Rate” means, the rate of interest publicly announced by the US Base
Rate Bank in New York, New York as its reference rate, base rate or prime rate. 
The reference rate, base rate or prime rate is determined from time to time by
the US Base Rate Bank as a means of pricing some loans to its borrowers and
neither is tied to any external rate of interest or index nor necessarily
reflects the lowest rate of interest actually charged by the US Base Rate Bank
to any particular class or category of customers.  Each change in the US Base
Rate shall be effective from and including the date such change is publicly
announced as being effective.

 

“US Base Rate Bank” means JPMorgan Chase Bank, N.A., its successors or any other
commercial bank designated by the Agent to the Administrative Borrower from time
to time.

 

“US Borrowers” means Parent, National Action Financial Services, Inc., a Georgia
corporation, SITEL Home Mortgage Corp., a Nebraska corporation, Financial
Insurance Services, Inc., a Nebraska corporation, SITEL International LLC, a
Delaware limited liability company, and each other Subsidiary of Parent created
or organized under the laws of the United States or any state thereof or the
District of Columbia that becomes a Borrower hereunder after the date hereof
pursuant to Section 5.15, and “US Borrower” means any one of them.

 

“US Borrowing” means a Borrowing hereunder consisting of US Advances made on the
same day by the Lenders (or the Fronting Lender or Administrative Agent on
behalf thereof), or by the US Swing Lender in the case of a US Swing Loan, or by
Administrative Agent in the case of a Protective Advance, in each case, to any
US Borrower.

 

“US Borrowing Base” means, as of any date of determination, the result of:

 

(a)                                  (x) 85% of the amount of Eligible US
Accounts, plus (y) the lesser of (A) 85% of the amount of Eligible Unbilled US
Accounts and (B) $30,000,000 less the Foreign Revolver Usage outstanding with
respect to clauses (a)(i)(y) and (b)(i)(y) of the definition of “Foreign
Borrowing Base”, less (z) the amount, if any, of the US Dilution Reserve, less

 

(b)                                 the sum of (i) the Bank Product Reserve, and
(ii) the aggregate amount of reserves, if any, established by Administrative
Agent under Section 2.1(b) with respect to US Borrowers, less

 

(c)                                  Foreign Revolver Usage less the amount of
clause (a) of the definition of “Foreign Borrowing Base”; provided, that, such
amount shall be deemed to be $0 if the amount of clause (a) of the definition of
“Foreign Borrowing Base” is equal to or greater than the Foreign Revolver Usage.

 

“US Borrowing Base Certificate” means a certificate substantially in the form of
Exhibit B-1(A) or any other form acceptable to Administrative Agent.

 

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“US Collateral” means all assets and interests in assets and proceeds thereof
now owned or hereafter acquired by US Loan Parties in or upon which a Lien is
granted by such US Loan Party under any of the Loan Documents.

 

“US Designated Account” means, with respect to Dollars, the applicable Deposit
Account of Administrative Borrower identified on Schedule D-1 as the US
Designated Account for Dollars, with respect to Euro, the applicable Deposit
Account of Administrative Borrower identified on Schedule D-1 as the US
Designated Account for Euro and, with respect to Sterling, the applicable
Deposit Account of Administrative Borrower identified on Schedule D-1 as the US
Designated Account for Sterling or, in each case, such other account as
Administrative Borrower may specify by notice to Administrative Agent.

 

“US Designated Account Bank” has the meaning specified therefor in Schedule D-1
or such other bank as Administrative Borrower may specify by notice to
Administrative Agent.

 

“US Dilution” means, as of any date of determination, a percentage, based upon
the experience of the immediately prior 12 Fiscal Months, that is the result of
dividing the Dollar amount of (a) bad debt write-downs, discounts, advertising
allowances, credits, or other dilutive items with respect to US Borrowers’
Accounts during such period, by (b) US Borrowers’ gross billings with respect to
Accounts during such period.

 

“US Dilution Reserve” means, as of any date of determination, an amount
sufficient to reduce the advance rate against Eligible US Accounts by 1
percentage point for each percentage point by which US Dilution is in excess of
5%.

 

“US Excess Availability” means, as of any date of determination, the amount
equal to US Availability plus Qualified Cash minus the aggregate amount, if any,
of all trade payables of US Borrowers aged in excess of 90 days after such
payables were created or aged in excess of their historical levels with respect
thereto and all book overdrafts of US Borrowers in excess of their historical
practices with respect thereto, in each case as determined in good faith by
Administrative Agent in its Permitted Discretion.

 

“US Guarantors” means each Subsidiary of each Borrower (other than SITEL Mexico
Holdings LLC, a Nebraska limited liability company, SITMEX-USA, LLC, a Delaware
limited liability company, US Borrowers and Immaterial Subsidiaries) created or
organized under the laws of the United States or any state thereof or the
District of Columbia that becomes a US Guarantor hereunder after the date
hereof, and “US Guarantor” means any one of them.

 

“US Guaranty” means a general continuing guaranty executed and delivered by each
US Guarantor in favor of Administrative Agent for the benefit of the Lender
Group and the Bank Product Providers.

 

“US Issuing Lender” means WFF or any other Lender that, at the request of
Administrative Borrower and with the consent of Administrative Agent, agrees, in
such

 

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Lender’s sole discretion, to become an Issuing Lender for the purpose of issuing
US L/Cs or US L/C Undertakings pursuant to Section 2.12.

 

“US L/C” has the meaning specified therefor in Section 2.12(a).

 

“US L/C Disbursement” means a payment made by the US Issuing Lender pursuant to
a US Letter of Credit.

 

“US L/C Undertaking” has the meaning specified therefor in Section 2.12(a).

 

“US Lender” means a Lender that has an interest in the US Revolver Commitment,
the Term Loan A and/or the US Revolver Usage.

 

“US Letter of Credit” means a US L/C or a US L/C Undertaking, as the context
requires.

 

“US Letter of Credit Usage” means, as of any date of determination, the Dollar
Equivalent of the aggregate undrawn amount of all outstanding US Letters of
Credit.

 

“US LIBOR Rate” means, for each Interest Period for each LIBOR Rate Loan, the
rate per annum determined by Administrative Agent (rounded upwards, if
necessary, to the next 1/100%) equal to (a) the Base LIBOR Rate for such
Interest Period, divided by (b) 100% minus the Reserve Percentage.  The US LIBOR
Rate shall be adjusted on and as of the effective day of any change in the
Reserve Percentage.

 

“US Loan Account” has the meaning specified therefor in Section 2.10.

 

“US Loan Parties” means the US Borrowers and US Guarantors, and “US Loan Party”
means any one of them.

 

“US Obligations” means (a) all loans (including the Term Loan A), US Advances,
debts, principal, interest (including any interest that accrues after the
commencement of an Insolvency Proceeding regardless of whether allowed or
allowable in whole or in part as a claim in any such Insolvency Proceeding),
contingent reimbursement obligations with respect to outstanding US Letters of
Credit, premiums, liabilities (including all amounts charged to US Loan Account
pursuant hereto), obligations (including indemnification obligations), fees
(including the fees provided for in the Fee Letter), charges, costs, Lender
Group Expenses (including any fees or expenses that accrue after the
commencement of an Insolvency Proceeding, regardless of whether allowed or
allowable in whole or in part as a claim in any such Insolvency Proceeding),
lease payments, guaranties, covenants, and duties of any kind and description
owing by US Borrowers to the Lender Group pursuant to or evidenced by the Loan
Documents and irrespective of whether for the payment of money, whether direct
or indirect, absolute or contingent, due or to become due, now existing or
hereafter arising, and including all interest not paid when due and all Lender
Group Expenses that US Borrowers are required to pay or reimburse by the Loan
Documents, by law, or otherwise, and (b) all Bank Product Obligations other than
Bank Product Obligations owing by Foreign Borrowers.  Any reference in the
Agreement or in the

 

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Loan Documents to the Obligations shall include all or any portion thereof and
any extensions, modifications, renewals, or alterations thereof, both prior and
subsequent to any Insolvency Proceeding.

 

“US Protective Advances” has the meaning specified therefor in
Section 2.3(d)(i).

 

“US Revolver Commitment” means, with respect to each Lender, its US Revolver
Commitment, and, with respect to all Lenders, their US Revolver Commitments, in
each case as such amounts are set forth beside such Lender’s name under the
applicable heading on Schedule C-1 or in the Assignment and Acceptance pursuant
to which such Lender became a Lender hereunder, as such amounts may be reduced
or increased from time to time pursuant to assignments made in accordance with
the provisions of Section 13.1.

 

“US Revolver Usage” means, as of any date of determination, the sum of (a) the
Dollar Equivalent of the principal amount of outstanding US Advances, plus
(b) the amount of the US Letter of Credit Usage, in each case as determined as
of such date.

 

“US Risk Participation Liability” means, as to each US Letter of Credit, all
reimbursement obligations of US Borrowers to the US Issuing Lender with respect
to a US L/C Undertaking, consisting of (a) the amount available to be drawn or
which may become available to be drawn, (b) all amounts that have been paid by
the US Issuing Lender to the US Underlying Issuer to the extent not reimbursed
by US Borrowers, whether by the making of a US Advance or otherwise, and (c) all
accrued and unpaid interest, fees, and expenses payable with respect thereto.

 

“US Security Agreement” means the security agreement, substantially in the form
of Exhibit U-1 hereto, executed and delivered by each US Borrower to Collateral
Agent.

 

“US Swing Lender” means WFF or any other Lender that, at the request of
Administrative Borrower and with the consent of Administrative Agent agrees, in
such Lender’s sole discretion, to become the US Swing Lender under
Section 2.3(b).

 

“US Swing Loan” has the meaning specified therefor in Section 2.3(b).

 

“US Underlying Issuer” means a third Person which is the beneficiary of a US L/C
Undertaking and which has issued a letter of credit at the request of the US
Issuing Lender for the benefit of one or more US Borrowers.

 

“US Underlying Letter of Credit” means a letter of credit that has been issued
by a US Underlying Issuer.

 

“Voidable Transfer” has the meaning specified therefor in Section 16.7.

 

“Wells Fargo” means Wells Fargo Bank, National Association, a national banking
association.

 

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“Week” means a period of five consecutive Business Days.

 

“WF Canada” means Wells Fargo Financial Corporation Canada, a Nova Scotia
unlimited liability company.

 

“WFF” means Wells Fargo Foothill, Inc., a California corporation.

 

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