Exhibit 10.25

 

 

CREDIT AGREEMENT

 

Dated as of March 26, 2008

 

among

 

CITI TRENDS, INC.,

as the Borrower,

 

THE SUBSIDIARIES OF THE BORROWER IDENTIFIED HEREIN,

as the Guarantors

 

and

 

BANK OF AMERICA, N.A.,

as Lender

 

 

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TABLE OF CONTENTS

 

ARTICLE I   DEFINITIONS AND ACCOUNTING TERMS

1

1.01

 

Defined Terms

1

1.02

 

Other Interpretive Provisions

15

1.03

 

Accounting Terms

15

1.04

 

Rounding

16

1.05

 

Times of Day

16

1.06

 

Letter of Credit Amounts

16

ARTICLE II

 

THE COMMITMENT AND CREDIT EXTENSIONS

16

2.01

 

Revolving Loans

16

2.02

 

Borrowings and Conversions

16

2.03

 

Letters of Credit

17

2.04

 

Prepayments

21

2.05

 

Termination or Reduction of Revolving Commitment

22

2.06

 

Repayment of Loans

22

2.07

 

Interest

22

2.08

 

Commitment Fee

22

2.9

 

Computation of Interest and Fees; Retroactive Adjustments of Applicable Rate

23

2.10

 

Evidence of Debt

23

2.11

 

Payments Generally

23

ARTICLE III

TAXES, YIELD PROTECTION AND ILLEGALITY

24

3.01

 

Taxes

24

3.02

 

Illegality

25

3.03

 

Inability to Determine Rates

25

3.04

 

Survival

25

ARTICLE IV

GUARANTY

26

4.01

 

The Guaranty

26

4.02

 

Obligations Unconditional

26

4.03

 

Reinstatement

27

4.04

 

Certain Additional Waivers

27

4.05

 

Remedies

27

4.06

 

Rights of Contribution

27

4.07

 

Guarantee of Payment; Continuing Guarantee

28

ARTICLE V

CONDITIONS PRECEDENT TO CREDIT EXTENSIONS

28

5.01

 

Conditions of Effectiveness

28

5.02

 

Conditions to all Credit Extensions

29

ARTICLE VI

REPRESENTATIONS AND WARRANTIES

29

6.01

 

Existence, Qualification and Power

29

6.02

 

Authorization; No Contravention

29

6.03

 

Governmental Authorization; Other Consents

30

6.04

 

Binding Effect

30

6.05

 

Financial Statements; No Material Adverse Effect

30

6.06

 

Litigation

30

6.07

 

No Default

31

6.08

 

Ownership of Property; Liens

31

6.09

 

Environmental Compliance

31

 

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6.10

 

Insurance

31

6.11

 

Taxes

32

6.12

 

ERISA Compliance

32

6.13

 

Subsidiaries

32

6.14

 

Margin Regulations; Investment Company Act

32

6.15

 

Disclosure

33

6.16

 

Compliance with Laws

33

6.17

 

Intellectual Property; Licenses, Etc.

33

6.18

 

Solvency

33

6.19

 

Labor Matters

33

ARTICLE VII   AFFIRMATIVE COVENANTS

33

7.01

 

Financial Statements

33

7.02

 

Certificates; Other Information

34

7.03

 

Notices

35

7.04

 

Payment of Taxes

35

7.05

 

Preservation of Existence, Etc.

35

7.06

 

Maintenance of Properties

36

7.07

 

Maintenance of Insurance

36

7.08

 

Compliance with Laws

36

7.09

 

Books and Records

36

7.10

 

Inspection Rights

36

7.11

 

Use of Proceeds

37

7.12

 

Additional Domestic Subsidiaries

37

7.13

 

Maintenace of Primary Depository Accounts with the Lender

37

ARTICLE VIII   NEGATIVE COVENANTS

37

8.01

 

Liens

37

8.02

 

Investments

38

8.03

 

Indebtedness

39

8.04

 

Fundamental Changes

39

8.05

 

Dispositions

39

8.06

 

Restricted Payments

40

8.07

 

Change in Nature of Business

40

8.08

 

Transactions with Affiliates and Insiders

40

8.09

 

Burdensome Agreements

40

8.10

 

Use of Proceeds

41

8.11

 

Consolidated Leverage Ratio

41

8.12

 

Organization Documents; Fiscal Year

41

8.13

 

Ownership of Subsidiaries

41

8.14

 

Sale Leasebacks

41

ARTICLE IX    EVENTS OF DEFAULT AND REMEDIES

41

9.01

 

Events of Default

41

9.02

 

Remedies Upon Event of Default

43

9.03

 

Application of Funds

44

ARTICLE X      MISCELLANEOUS

44

10.01

 

Amendments, Etc.

44

10.02

 

Notices; Effectiveness; Electronic Communications

44

 

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10.03

 

No Waiver; Cumulative Remedies; Enforcement

45

10.04

 

Expenses; Indemnity; and Damage Waiver

45

10.05

 

Payments Set Aside

46

10.06

 

Successors and Assigns

46

10.07

 

Set-off

47

10.08

 

Interest Rate Limitation

47

10.09

 

Counterparts; Integration; Effectiveness

47

10.10

 

Survival of Representations and Warranties

48

10.11

 

Severability

48

10.12

 

Governing Law; Jurisdiction; Etc.

48

10.13

 

Waiver of Right to Trial by Jury

49

10.14

 

No Advisory or Fiduciary Responsibility

49

10.15

 

Electronic Execution of Assignments and Certain Other Documents

49

10.16

 

USA PATRIOT Act

50

 

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CREDIT AGREEMENT

 

This CREDIT AGREEMENT is entered into as of March 26, 2008 among CITI TRENDS,
INC., a Delaware corporation (the “Borrower”), the Guarantors (defined herein),
and BANK OF AMERICA, N.A. (the “Lender”).

 

The Borrower has requested that the Lender provide $35 million in credit
facilities for the purposes set forth herein, and the Lender is willing to do so
on the terms and conditions set forth herein.

 

In consideration of the mutual covenants and agreements herein contained, the
parties hereto covenant and agree as follows:

 

ARTICLE I

 

DEFINITIONS AND ACCOUNTING TERMS

 

1.01         DEFINED TERMS.

 

As used in this Agreement, the following terms shall have the meanings set forth
below:

 

“Acquisition”, by any Person, means the acquisition by such Person, in a single
transaction or in a series of related transactions, of either (a) all or any
substantial portion of the property of, or a line of business or division of,
another Person or (b) at least a majority of the Voting Stock of another Person,
in each case whether or not involving a merger or consolidation with such other
Person.

 

“Affiliate” means, with respect to any Person, another Person that directly, or
indirectly through one or more intermediaries, Controls or is Controlled by or
is under common Control with the Person specified.

 

“Agreement” means this Credit Agreement.

 

“Applicable Period” means the period of the four fiscal quarters most recently
ended for which the Borrower has delivered financial statements pursuant to
Section 7.01(a) or (b).

 

“Applicable Rate” means the following percentages per annum, based upon the
Consolidated Leverage Ratio as set forth in the most recent Compliance
Certificate received by the Lender pursuant to Section 7.02(b):

 

Pricing
Tier

 

Consolidated Leverage
Ratio

 

Eurodollar Rate
Loans

 

Base Rate
Loans

 

Commitment
Fee

 

1

 

<2.25:1.0

 

1.00

%

0.00

%

0.15

%

2

 

> 2.25:1.0 but < 3.00:1.0

 

1.25

%

0.25

%

0.15

%

3

 

> 3.00:1.0

 

1.50

%

0.50

%

0.15

%

 

Any increase or decrease in the Applicable Rate resulting from a change in the
Consolidated Leverage Ratio shall become effective as of the first Business Day
immediately following the date a Compliance Certificate is delivered pursuant to
Section 7.02(b); provided, however, that if a Compliance Certificate is not
delivered when due in accordance with such Section, then Pricing Tier 3 shall
apply as of the first Business Day after the date on which such Compliance
Certificate was required to have been delivered and shall remain in effect until
the date on which such Compliance Certificate is delivered.  The Applicable Rate
in effect from the Closing Date through the first Business Day immediately
following the

 

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date a Compliance Certificate is required to be delivered pursuant to
Section 7.02(b) for the fiscal quarter ending March 31, 2008 shall be determined
based upon Pricing Tier 3.

 

“Attributable Indebtedness” means, with respect to any Person on any date,
(a) in respect of any Capital Lease, the capitalized amount thereof that would
appear on a balance sheet of such Person prepared as of such date in accordance
with GAAP, (b) in respect of any Synthetic Lease, the capitalized amount of the
remaining lease payments under the relevant lease that would appear on a balance
sheet of such Person prepared as of such date in accordance with GAAP if such
lease were accounted for as a Capital Lease, (c) in respect of any
Securitization Transaction, the outstanding principal amount of such financing,
after taking into account reserve accounts and making appropriate adjustments,
determined by the Lender in its reasonable judgment and (d) in respect of any
Sale and Leaseback Transaction, the present value (discounted in accordance with
GAAP at the debt rate implied in the applicable lease) of the obligations of the
lessee for rental payments during the term of such lease).

 

“Audited Financial Statements” means the audited consolidated balance sheet of
the Borrower and its Subsidiaries for the fiscal year ended February 3, 2007,
and the related consolidated statements of income or operations, shareholders’
equity and cash flows of the Borrower and its Subsidiaries for such fiscal year,
including the notes thereto.

 

“Availability Period” means the period from and including the Closing Date to
the earliest of (a) the Maturity Date, (b) the date of termination of the
Revolving Commitment pursuant to Section 2.05 and (c) the date of termination of
the commitment of the Lender to make Loans and L/C Credit Extensions pursuant to
Section 9.02.

 

“Bank of America” means Bank of America, N.A. and its successors.

 

“Base Rate” means for any day a fluctuating rate per annum equal to the higher
of (a) the Federal Funds Rate plus 0.50% and (b) the rate of interest in effect
for such day as publicly announced from time to time by Bank of America as its
“prime rate”.  The “prime rate” is a rate set by Bank of America based upon
various factors including Bank of America’s costs and desired return, general
economic conditions and other factors, and is used as a reference point for
pricing some loans, which may be priced at, above, or below such announced
rate.  Any change in the “prime rate” announced by Bank of America shall take
effect at the opening of business on the day specified in the public
announcement of such change.

 

“Base Rate Loan” means a Loan that bears interest based on the Base Rate.

 

“Borrower” has the meaning specified in the introductory paragraph hereto.

 

“Borrowing” means a borrowing consisting of simultaneous Loans of the same Type.

 

“Business Day” means any day other than a Saturday, Sunday or other day on which
commercial banks are authorized to close under the Laws of, or are in fact
closed in, the state where the Lender’s Office is located and, if such day
relates to any Eurodollar Rate Loan, means any such day on which dealings in
Dollar deposits are conducted by and between banks in the London interbank
eurodollar market.

 

“Capital Lease” means, as applied to any Person, any lease of any property by
that Person as lessee which, in accordance with GAAP, is required to be
accounted for as a capital lease on the balance sheet of that Person.

 

“Cash Collateralize” has the meaning specified in Section 2.03(f).

 

2

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“Cash Equivalents” means, as at any date, (a) securities issued or directly and
fully guaranteed or insured by the United States or any agency or
instrumentality thereof (provided that the full faith and credit of the United
States is pledged in support thereof) having maturities of not more than twelve
months from the date of acquisition, (b) Dollar denominated time deposits and
certificates of deposit of (i) the Lender, (ii) any domestic commercial bank of
recognized standing having capital and surplus in excess of $500,000,000 or
(iii) any bank whose short-term commercial paper rating from S&P is at least A-1
or the equivalent thereof or from Moody’s is at least P-1 or the equivalent
thereof (any such bank being an “Approved Bank”), in each case with maturities
of not more than 270 days from the date of acquisition, (c) commercial paper and
variable or fixed rate notes issued by any Approved Bank (or by the parent
company thereof) or any variable rate notes issued by, or guaranteed by, any
domestic corporation rated A-1 (or the equivalent thereof) or better by S&P or
P-1 (or the equivalent thereof) or better by Moody’s and maturing or having an
auction date within six months of the date of acquisition, (d) repurchase
agreements entered into by any Person with a bank or trust company (including
the Lender) or recognized securities dealer having capital and surplus in excess
of $500,000,000 for direct obligations issued by or fully guaranteed by the
United States in which such Person shall have a perfected first priority
security interest (subject to no other Liens) and having, on the date of
purchase thereof, a fair market value of at least 100% of the amount of the
repurchase obligations and (e) investments, classified in accordance with GAAP
as current assets, in money market investment programs registered under the
Investment Company Act of 1940 which are administered by reputable financial
institutions having capital of at least $500,000,000 and the portfolios of which
are limited to Investments of the character described in the foregoing
subdivisions (a) through (d).

 

“Change in Law” means the occurrence, after the date of this Agreement, of any
of the following: (a) the adoption or taking effect of any law, rule, regulation
or treaty, (b) any change in any law, rule, regulation or treaty or in the
administration, interpretation or application thereof by any Governmental
Authority or (c) the making or issuance of any request, guideline or directive
(whether or not having the force of law) by any Governmental Authority.

 

“Change of Control” means an event or series of events by which:

 

(a)           any “person” or “group” (as such terms are used in Sections
13(d) and 14(d) of the Securities Exchange Act of 1934, but excluding any
employee benefit plan of such person or its subsidiaries, and any person or
entity acting in its capacity as trustee, agent or other fiduciary or
administrator of any such plan) becomes the “beneficial owner” (as defined in
Rules 13d-3 and 13d-5 under the Securities Exchange Act of 1934, except that a
person or group shall be deemed to have “beneficial ownership” of all Equity
Interests that such person or group has the right to acquire, whether such right
is exercisable immediately or only after the passage of time (such right, an
“option right”)), directly or indirectly, of twenty five percent (25%) or more
of the Equity Interests of the Borrower entitled to vote for members of the
board of directors or equivalent governing body of the Borrower on a fully
diluted basis (and taking into account all such securities that such person or
group has the right to acquire pursuant to any option right);

 

(b)           during any period of 24 consecutive months, a majority of the
members of the board of directors or other equivalent governing body of the
Borrower cease to be composed of individuals (i) who were members of that board
or equivalent governing body on the first day of such period, (ii) whose
election or nomination to that board or equivalent governing body was approved
by individuals referred to in clause (i) above constituting at the time of such
election or nomination at least a majority of that board or equivalent governing
body or (iii) whose election or nomination to that board or other equivalent
governing body was approved by individuals referred to in clauses (i) and
(ii) above constituting at the time of such election or nomination at least a
majority of that board or equivalent governing body (excluding, in the case of
both clause

 

3

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(ii) and clause (iii), any individual whose initial nomination for, or
assumption of office as, a member of that board or equivalent governing body
occurs as a result of an actual or threatened solicitation of proxies or
consents for the election or removal of one or more directors by any person or
group other than a solicitation for the election of one or more directors by or
on behalf of the board of directors); or

 

(c)           any Person or two or more Persons acting in concert shall have
acquired by contract or otherwise, or shall have entered into a contract or
arrangement that, upon consummation thereof, will result in its or their
acquisition of the power to exercise, directly or indirectly, a controlling
influence over the management or policies of the Borrower, or control over the
Voting Stock of the Borrower on a fully-diluted basis (and taking into account
all such Voting Stock that such Person or group has the right to acquire
pursuant to any option right) representing twenty five percent (25%) or more of
the combined voting power of such Voting Stock.

 

“Closing Date” means the date hereof.

 

“Compliance Certificate” means a certificate substantially in the form of
Exhibit 7.02.

 

“Consolidated EBITDA” means, for any period, for the Borrower and its
Subsidiaries on a consolidated basis, an amount equal to Consolidated Net Income
for such period plus the following to the extent deducted in calculating such
Consolidated Net Income: (a) Consolidated Interest Charges for such period,
(b) the provision for federal, state, local and foreign income taxes payable for
such period, (c) the amount of depreciation and amortization expense for such
period and (d) rent and lease expense for such period.

 

“Consolidated Funded Indebtedness” means Funded Indebtedness of the Borrower and
its Subsidiaries on a consolidated basis.

 

“Consolidated Interest Charges” means, for any period, for the Borrower and its
Subsidiaries on a consolidated basis, an amount equal to the sum of (i) all
interest, premium payments, debt discount, fees, charges and related expenses in
connection with borrowed money (including capitalized interest) or in connection
with the deferred purchase price of assets, in each case to the extent treated
as interest in accordance with GAAP, plus (ii) the portion of rent expense with
respect to such period under Capital Leases that is treated as interest in
accordance with GAAP plus (iii) the implied interest component of Synthetic
Leases with respect to such period.

 

“Consolidated Leverage Ratio” means, as of any date of determination, the ratio
of (a) the sum of (i) Consolidated Funded Indebtedness as of such date plus
(ii) eight (8) times the rent and lease expense for the Applicable Period to
(b) Consolidated EBITDA for the Applicable Period.

 

“Consolidated Net Income” means, for any period, for the Borrower and its
Subsidiaries on a consolidated basis, the net income (excluding extraordinary
gains) for that period.

 

“Control” means the possession, directly or indirectly, of the power to direct
or cause the direction of the management or policies of a Person, whether
through the ability to exercise voting power, by contract or otherwise. 
“Controlling” and “Controlled” have meanings correlative thereto.  Without
limiting the generality of the foregoing, a Person shall be deemed to be
Controlled by another Person if such other Person possesses, directly or
indirectly, power to vote 5% or more of the securities having ordinary voting
power for the election of directors, managing general partners or the
equivalent.

 

4

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“Credit Extension” means each of the following: (a) a Borrowing and (b) an L/C
Credit Extension.

 

“Debtor Relief Laws” means the Bankruptcy Code of the United States, and all
other liquidation, conservatorship, bankruptcy, assignment for the benefit of
creditors, moratorium, rearrangement, receivership, insolvency, reorganization,
or similar debtor relief Laws of the United States or other applicable
jurisdictions from time to time in effect and affecting the rights of creditors
generally.

 

“Default” means any event or condition that constitutes an Event of Default or
that, with the giving of any notice, the passage of time, or both, would be an
Event of Default.

 

“Default Rate” means (a) when used with respect to Obligations other than Letter
of Credit Fees, an interest rate equal to (i) the Base Rate plus (ii) the
Applicable Rate, if any, applicable to Base Rate Loans plus (iii) 2% per annum;
provided, however, that with respect to a Eurodollar Rate Loan, the Default Rate
shall be an interest rate equal to the interest rate (including any Applicable
Rate) otherwise applicable to such Loan plus 2% per annum, in each case to the
fullest extent permitted by applicable Laws and (b) when used with respect to
Letter of Credit Fees, a rate equal to the Applicable Rate plus 2% per annum.

 

“Disposition” or “Dispose” means the sale, transfer, license, lease or other
disposition of any property by the Borrower or any Subsidiary, including any
Sale and Leaseback Transaction and any sale, assignment, transfer or other
disposal, with or without recourse, of any notes or accounts receivable or any
rights and claims associated therewith, but excluding (a) the disposition of
inventory in the ordinary course of business; (b) the disposition of machinery
and equipment no longer used or useful in the conduct of business of the
Borrower and its Subsidiaries in the ordinary course of business; (c) the
disposition of property to the Borrower or any Subsidiary; provided, that if the
transferor of such property is a Loan Party then the transferee thereof must be
a Loan Party; (d) the disposition of accounts receivable in connection with the
collection or compromise thereof; (e) licenses, sublicenses, leases or subleases
granted to others not interfering in any material respect with the business of
the Borrower and its Subsidiaries; (f) the sale or disposition of Cash
Equivalents for fair market value; and (g) any Involuntary Disposition.

 

“Dollar” and “$” mean lawful money of the United States.

 

“Domestic Subsidiary” means any Subsidiary that is organized under the laws of
any state of the United States or the District of Columbia.

 

“Environmental Laws” means any and all federal, state, local, foreign and other
applicable statutes, laws, regulations, ordinances, rules, judgments, orders,
decrees, permits, concessions, grants, franchises, licenses, agreements or
governmental restrictions relating to pollution and the protection of the
environment or the release of any materials into the environment, including
those related to hazardous substances or wastes, air emissions and discharges to
waste or public systems.

 

“Environmental Liability” means any liability, contingent or otherwise
(including any liability for damages, costs of environmental remediation, fines,
penalties or indemnities), of the Borrower or any Subsidiary directly or
indirectly resulting from or based upon (a) violation of any Environmental Law,
(b) the generation, use, handling, transportation, storage, treatment or
disposal of any Hazardous Materials, (c) exposure to any Hazardous Materials,
(d) the release or threatened release of any Hazardous Materials into the
environment or (e) any contract, agreement or other consensual arrangement
pursuant to which liability is assumed or imposed with respect to any of the
foregoing.

 

5

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“Equity Interests”  means, with respect to any Person, all of the shares of
capital stock of (or other ownership or profit interests in) such Person, all of
the warrants, options or other rights for the purchase or acquisition from such
Person of shares of capital stock of (or other ownership or profit interests in)
such Person, all of the securities convertible into or exchangeable for shares
of capital stock of (or other ownership or profit interests in) such Person or
warrants, rights or options for the purchase or acquisition from such Person of
such shares (or such other interests), and all of the other ownership or profit
interests in such Person (including partnership, member or trust interests
therein), whether voting or nonvoting, and whether or not such shares, warrants,
options, rights or other interests are outstanding on any date of determination.

 

“ERISA” means the Employee Retirement Income Security Act of 1974.

 

“ERISA Affiliate” means any trade or business (whether or not incorporated)
under common control with the Borrower within the meaning of Section 414(b) or
(c) of the Internal Revenue Code (and Sections 414(m) and (o) of the Internal
Revenue Code for purposes of provisions relating to Section 412 of the Internal
Revenue Code).

 

“ERISA Event” means (a) a Reportable Event with respect to a Pension Plan; (b) a
withdrawal by the Borrower or any ERISA Affiliate from a Pension Plan subject to
Section 4063 of ERISA during a plan year in which it was a substantial employer
(as defined in Section 4001(a)(2) of ERISA) or a cessation of operations that is
treated as such a withdrawal under Section 4062(e) of ERISA; (c) a complete or
partial withdrawal by the Borrower or any ERISA Affiliate from a Multiemployer
Plan or notification that a Multiemployer Plan is in reorganization; (d) the
filing of a notice of intent to terminate, the treatment of a Plan amendment as
a termination under Section 4041 or 4041A of ERISA, or the commencement of
proceedings by the PBGC to terminate a Pension Plan or Multiemployer Plan;
(e) an event or condition which constitutes grounds under Section 4042 of ERISA
for the termination of, or the appointment of a trustee to administer, any
Pension Plan or Multiemployer Plan; or (f) the imposition of any liability under
Title IV of ERISA, other than for PBGC premiums due but not delinquent under
Section 4007 of ERISA, upon the Borrower or any ERISA Affiliate.

 

“Eurodollar Daily Floating Base Rate” means, for any day with respect to a
Eurodollar Rate Loan, the rate per annum equal to the British Bankers
Association LIBOR Rate (“BBA LIBOR”), as published by Reuters (or other
commercially available source providing quotations of BBA LIBOR as designated by
the Lender from time to time) at approximately 11:00 a.m., London time, two
Business Days prior to such day for Dollar deposits (for delivery on such day)
with a term equivalent to one month.  If such rate is not available at such time
for any reason, then the “Eurodollar Daily Floating Base Rate” for such day
shall be the rate per annum determined by the Lender to be the rate at which
deposits in Dollars for delivery on such day in same day funds in the
approximate amount of the Eurodollar Rate Loan being made, continued or
converted by Bank of America and with a term equivalent to one month would be
offered by Bank of America’s London Branch to major banks in the London
interbank eurodollar market at their request at approximately 11:00 a.m. (London
time) two Business Days prior to such day.

 

“Eurodollar Rate” means a rate per annum equal to the Eurodollar Daily Floating
Base Rate as adjusted from time to time in the Lender’s sole discretion for
reserve requirements, deposit insurance assessment rates and other regulatory
costs.

 

“Eurodollar Rate Loan” means a Loan that bears interest at a rate based on the
Eurodollar Rate.

 

“Event of Default” has the meaning specified in Section 9.01.

 

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“Excluded Taxes” means, with respect to the Lender or any other recipient of any
payment to be made by or on account of any obligation of the Borrower hereunder,
(a) taxes imposed on or measured by its overall net income (however
denominated), and franchise taxes imposed on it (in lieu of net income taxes),
by the jurisdiction (or any political subdivision thereof) under the Laws of
which such recipient is organized or in which its principal office is located
or, in the case of the Lender, in which the Lender’s Office is located, (b) any
branch profits taxes imposed by the United States or any similar tax imposed by
any other jurisdiction in which the Borrower is located, and (c) any backup
withholding tax that is required by the Internal Revenue Code to be withheld
from amounts payable to the Lender if the Lender has failed to comply with
clause (A) of Section 3.01(e)(ii).

 

“Federal Funds Rate” means, for any day, the rate per annum equal to the
weighted average of the rates on overnight federal funds transactions with
members of the Federal Reserve System arranged by federal funds brokers on such
day, as published by the Federal Reserve Bank of New York on the Business Day
next succeeding such day; provided that (a) if such day is not a Business Day,
the Federal Funds Rate for such day shall be such rate on such transactions on
the next preceding Business Day as so published on the next succeeding Business
Day, and (b) if no such rate is so published on such next succeeding Business
Day, the Federal Funds Rate for such day shall be the average rate (rounded
upward, if necessary, to a whole multiple of 1/100 of 1%) charged to Bank of
America on such day on such transactions as determined by the Lender.

 

“Foreign Subsidiary” means any Subsidiary that is not a Domestic Subsidiary.

 

“FRB” means the Board of Governors of the Federal Reserve System of the United
States.

 

“Funded Indebtedness” means, as to any Person at a particular time, without
duplication, all of the following, whether or not included as indebtedness or
liabilities in accordance with GAAP:

 

(a)           all obligations for borrowed money, whether current or long-term
(including the Obligations) and all obligations evidenced by bonds, debentures,
notes, loan agreements or other similar instruments;

 

(b)           all purchase money indebtedness;

 

(c)           the principal portion of all obligations under conditional sale or
other title retention agreements relating to property purchased by such Person
(other than customary reservations or retentions of title under agreements with
suppliers entered into in the ordinary course of business);

 

(d)           the maximum amount available to be drawn under letters of credit
(including standby and commercial), bankers’ acceptances, bank guaranties,
surety bonds and similar instruments;

 

(e)           all obligations in respect of the deferred purchase price of
property or services (other than trade accounts payable in the ordinary course
of business and, in each case, not past due for more than 60 days after the date
on which such trade account payable was created);

 

(f)            the Attributable Indebtedness of Capital Leases, Sale and
Leaseback Transactions, Synthetic Leases and Securitization Transactions;

 

(g)           all obligations to purchase, redeem, retire, defease or otherwise
make any payment prior to the Maturity Date in respect of any Equity Interests,
valued, in the case of a

 

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redeemable preferred interest, at the greater of its voluntary or involuntary
liquidation preference plus accrued and unpaid dividends;

 

(h)           all Funded Indebtedness of others secured by (or for which the
holder of such Funded Indebtedness has an existing right, contingent or
otherwise, to be secured by) any Lien on, or payable out of the proceeds of
production from, property owned or acquired by such Person, whether or not the
obligations secured thereby have been assumed;

 

(i)            all Guarantees with respect to Funded Indebtedness of the types
specified in clauses (a) through (h) above of another Person; and

 

(j)            all Funded Indebtedness of the types referred to in clauses
(a) through (i) above of any partnership or joint venture (other than a joint
venture that is itself a corporation or limited liability company) in which such
Person is a general partner or joint venturer, except to the extent that Funded
Indebtedness is expressly made non-recourse to such Person.

 

“GAAP” means generally accepted accounting principles in the United States set
forth in the opinions and pronouncements of the Accounting Principles Board and
the American Institute of Certified Public Accountants and statements and
pronouncements of the Financial Accounting Standards Board, consistently applied
and as in effect from time to time.

 

“Governmental Authority” means the government of the United States or any other
nation, or of any political subdivision thereof, whether state or local, and any
agency, authority, instrumentality, regulatory body, court, central bank or
other entity exercising executive, legislative, judicial, taxing, regulatory or
administrative powers or functions of or pertaining to government (including any
supra-national bodies such as the European Union or the European Central Bank).

 

“Guarantee” means, as to any Person, (a) any obligation, contingent or
otherwise, of such Person guaranteeing or having the economic effect of
guaranteeing any Indebtedness or other obligation payable or performable by
another Person (the “primary obligor”) in any manner, whether directly or
indirectly, and including any obligation of such Person, direct or indirect,
(i) to purchase or pay (or advance or supply funds for the purchase or payment
of) such Indebtedness or other obligation, (ii) to purchase or lease property,
securities or services for the purpose of assuring the obligee in respect of
such Indebtedness or other obligation of the payment or performance of such
Indebtedness or other obligation, (iii) to maintain working capital, equity
capital or any other financial statement condition or liquidity or level of
income or cash flow of the primary obligor so as to enable the primary obligor
to pay such Indebtedness or other obligation, or (iv) entered into for the
purpose of assuring in any other manner the obligee in respect of such
Indebtedness or other obligation of the payment or performance thereof or to
protect such obligee against loss in respect thereof (in whole or in part), or
(b) any Lien on any assets of such Person securing any Indebtedness or other
obligation of any other Person, whether or not such Indebtedness or other
obligation is assumed by such Person (or any right, contingent or otherwise, of
any holder of such Indebtedness to obtain any such Lien).  The amount of any
Guarantee shall 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 by the
guaranteeing Person in good faith.  The term “Guarantee” as a verb has a
corresponding meaning.

 

“Guarantors” means each Domestic Subsidiary identified as a “Guarantor” on the
signature pages hereto and each other Person that joins as a Guarantor pursuant
to Section 7.12 or otherwise, together with their successors and permitted
assigns.

 

8

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“Hazardous Materials” means all explosive or radioactive substances or wastes
and all hazardous or toxic substances, wastes or other pollutants, including
petroleum or petroleum distillates, asbestos or asbestos-containing materials,
polychlorinated biphenyls, radon gas, infectious or medical wastes and all other
substances or wastes of any nature regulated pursuant to any Environmental Law.

 

“Honor Date” has the meaning set forth in Section 2.03(c).

 

“Indebtedness” means, as to any Person at a particular time, without
duplication, all of the following, whether or not included as indebtedness or
liabilities in accordance with GAAP:

 

(a)           all Funded Indebtedness;

 

(b)           the Swap Termination Value of any Swap Contract;

 

(c)           all Guarantees with respect to outstanding Indebtedness of the
types specified in clauses (a) and (b) above of any other Person; and

 

(d)           all Indebtedness of the types referred to in clauses (a) through
(c) above of any partnership or joint venture (other than a joint venture that
is itself a corporation or limited liability company) in which such Person is a
general partner or joint venturer, unless such Indebtedness is expressly made
non-recourse to such Person.

 

“Indemnified Taxes” means Taxes other than Excluded Taxes.

 

“Indemnitees” has the meaning specified in Section 10.04(b).

 

“Interim Financial Statements” means the unaudited consolidated and
consolidating financial statements of the Borrower and its Subsidiaries for the
fiscal quarter ending September 30, 2007, including balance sheets and
statements of income or operations, shareholders’ equity and cash flows.

 

“Internal Revenue Code” means the Internal Revenue Code of 1986.

 

“Investment” means, as to any Person, any direct or indirect acquisition or
investment by such Person, whether by means of (a) the purchase or other
acquisition of Equity Interests of another Person, (b) a loan, advance or
capital contribution to, Guarantee or assumption of debt of, or purchase or
other acquisition of any other debt or equity participation or interest in,
another Person, or (c) an Acquisition.  For purposes of covenant compliance, the
amount of any Investment shall be the amount actually invested, without
adjustment for subsequent increases or decreases in the value of such
Investment, less the amount of any return of capital of such Investment.

 

“Involuntary Disposition” means any loss of, damage to or destruction of, or any
condemnation or other taking for public use of, any property of the Borrower or
any Subsidiary.

 

“IRS” means the United States Internal Revenue Service.

 

“ISP” means, with respect to any Letter of Credit, the “International Standby
Practices 1998” published by the Institute of International Banking Law &
Practice, Inc. (or such later version thereof as may be in effect at the time of
issuance).

 

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“Issuer Documents” means with respect to any Letter of Credit, the Letter of
Credit Application, and any other document, agreement and instrument entered
into by the Lender and the Borrower (or any Subsidiary) or in favor of the
Lender and relating to such Letter of Credit.

 

“Joinder Agreement” means a joinder agreement substantially in the form of
Exhibit 7.12 executed and delivered by a Domestic Subsidiary in accordance with
the provisions of Section 7.12.

 

“Laws” means, collectively, all international, foreign, federal, state and local
statutes, treaties, rules, guidelines, regulations, ordinances, codes and
administrative or judicial precedents or authorities, including the
interpretation or administration thereof by any Governmental Authority charged
with the enforcement, interpretation or administration thereof, and all
applicable administrative orders, directed duties, requests, licenses,
authorizations and permits of, and agreements with, any Governmental Authority,
in each case whether or not having the force of law.

 

“L/C Borrowing” means an extension of credit resulting from a drawing under any
Letter of Credit which has not been reimbursed on the date when made or
refinanced as a Borrowing of Revolving Loans.

 

“L/C Credit Extension” means, with respect to any Letter of Credit, the issuance
thereof or extension of the expiry date thereof, or the increase of the amount
thereof.

 

“L/C Obligations” means, as at any date of determination, the aggregate amount
available to be drawn under all outstanding Letters of Credit plus the aggregate
of all Unreimbursed Amounts, including all L/C Borrowings.  For purposes of
computing the amount available to be drawn under any Letter of Credit, the
amount of such Letter of Credit shall be determined in accordance with
Section 1.06.  For all purposes of this Agreement, if on any date of
determination a Letter of Credit has expired by its terms but any amount may
still be drawn thereunder by reason of the operation of Rule 3.14 of the ISP,
such Letter of Credit shall be deemed to be “outstanding” in the amount so
remaining available to be drawn.

 

“Lender” has the meaning specified in the introductory paragraph hereto.

 

“Lender’s Office” means the Lender’s address and, as appropriate, account as set
forth on Schedule 11.02 or such other address or account as the Lender may from
time to time notify the Borrower.

 

“Letter of Credit” means any standby letter of credit issued hereunder.

 

“Letter of Credit Application” means an application and agreement for the
issuance or amendment of a letter of credit in the form from time to time in use
by the Lender.

 

“Letter of Credit Fee” has the meaning specified in Section 2.03(g).

 

“Letter of Credit Sublimit” means an amount equal to the lesser of (a) the
Revolving Commitment and (b) $5 million.  The Letter of Credit Sublimit is part
of, and not in addition to, the Revolving Commitment.

 

“Lien” means any mortgage, pledge, hypothecation, assignment, deposit
arrangement, encumbrance, lien (statutory or other), charge, or preference,
priority or other security interest or preferential arrangement in the nature of
a security interest of any kind or nature whatsoever (including any conditional
sale or other title retention agreement, any easement, right of way or other
encumbrance

 

10

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on title to real property, and any financing lease having substantially the same
economic effect as any of the foregoing).

 

“Loan” means an extension of credit by the Lender to the Borrower under
Article II in the form of a Revolving Loan.

 

“Loan Documents” means this Agreement, each Note, each Issuer Document and each
Joinder Agreement.

 

“Loan Notice” means a notice of (a) a Borrowing of Revolving Loans, (b) a
conversion of Loans from one Type to the other, or (c) a continuation of
Eurodollar Rate Loans, in each case pursuant to Section 2.02, which, if in
writing, shall be substantially in the form of Exhibit 2.02.

 

“Loan Parties” means, collectively, the Borrower and each Guarantor.

 

“Material Adverse Effect” means (a) a material adverse change in, or a material
adverse effect upon, the operations, business, properties, liabilities (actual
or contingent), condition (financial or otherwise) or prospects of the Borrower
and its Subsidiaries taken as a whole; (b) a material impairment of the ability
of any Loan Party to perform its obligations under any Loan Document to which it
is a party; or (c) a material adverse effect upon the legality, validity,
binding effect or enforceability against any Loan Party of any Loan Document to
which it is a party.

 

“Material Domestic Subsidiary” means any Domestic Subsidiary that owns any
property or engages in any business.

 

 “Material Indebtedness” means any Indebtedness (other than Indebtedness arising
under the Loan Documents and Indebtedness arising under Swap Contracts) having
an aggregate principal amount (including undrawn committed or available amounts
and including amounts owing to all creditors under any combined or syndicated
credit arrangement) of more than the Threshold Amount.

 

“Maturity Date” means March 25, 2009; provided, however, that, in each case, if
such date is not a Business Day, the Maturity Date shall be the next preceding
Business Day.

 

“Moody’s” means Moody’s Investors Service, Inc. and any successor thereto.

 

“Multiemployer Plan” means any employee benefit plan of the type described in
Section 4001(a)(3) of ERISA, to which the Borrower or any ERISA Affiliate makes
or is obligated to make contributions, or during the preceding five plan years,
has made or been obligated to make contributions.

 

“Note” has the meaning specified in Section 2.10.

 

“Obligations” means all advances to, and debts, liabilities, obligations,
covenants and duties of, any Loan Party arising under any Loan Document or
otherwise with respect to any Loan or Letter of Credit, whether direct or
indirect (including those acquired by assumption), absolute or contingent, due
or to become due, now existing or hereafter arising and including interest and
fees that accrue after the commencement by or against any Loan Party or any
Affiliate thereof of any proceeding under any Debtor Relief Laws naming such
Person as the debtor in such proceeding, regardless of whether such interest and
fees are allowed claims in such proceeding. The foregoing shall also include
(a) all obligations under any Swap Contract between the Borrower or any
Subsidiary and the Lender or Affiliate of the Lender and

 

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(b) all obligations under any Treasury Management Agreement between the Borrower
or any Subsidiary and the Lender or Affiliate of the Lender.

 

“Organization Documents” means, (a) with respect to any corporation, the
certificate or articles of incorporation and the bylaws (or equivalent or
comparable constitutive documents with respect to any non-U.S. jurisdiction);
(b) with respect to any limited liability company, the certificate or articles
of formation or organization and operating agreement; and (c) with respect to
any partnership, joint venture, trust or other form of business entity, the
partnership, joint venture or other applicable agreement of formation or
organization and any agreement, instrument, filing or notice with respect
thereto filed in connection with its formation or organization with the
applicable Governmental Authority in the jurisdiction of its formation or
organization and, if applicable, any certificate or articles of formation or
organization of such entity.

 

“Other Taxes” means all present or future stamp or documentary taxes or any
other excise or property taxes, charges or similar levies arising from any
payment made hereunder or under any other Loan Document or from the execution,
delivery or enforcement of, or otherwise with respect to, this Agreement or any
other Loan Document.

 

“Participant” has the meaning specified in Section 10.06(c).

 

“PBGC” means the Pension Benefit Guaranty Corporation or any successor thereto.

 

“Pension Plan” means any “employee pension benefit plan” (as such term is
defined in Section 3(2) of ERISA), other than a Multiemployer Plan, that is
subject to Title IV of ERISA and is sponsored or maintained by the Borrower or
any ERISA Affiliate or to which the Borrower or any ERISA Affiliate contributes
or has an obligation to contribute, or in the case of a multiple employer or
other plan described in Section 4064(a) of ERISA, has made contributions at any
time during the immediately preceding five plan years.

 

“Permitted Liens” means, at any time, Liens in respect of property of the
Borrower or any Subsidiary permitted to exist at such time pursuant to the terms
of Section 8.01.

 

“Person” means any natural person, corporation, limited liability company,
trust, joint venture, association, company, partnership, Governmental Authority
or other entity.

 

“Plan” means any “employee benefit plan” (as such term is defined in
Section 3(3) of ERISA) established by the Borrower or, with respect to any such
plan that is subject to Section 412 of the Internal Revenue Code or Title IV of
ERISA, any ERISA Affiliate.

 

“Related Parties” means, with respect to any Person, such Person’s Affiliates
and the partners, directors, officers, employees, agents, trustees and advisors
of such Person and of such Person’s Affiliates.

 

“Reportable Event” means any of the events set forth in Section 4043(c) of
ERISA, other than events for which the thirty-day notice period has been waived.

 

“Request for Credit Extension” means (a) with respect to a Borrowing, conversion
or continuation of Loans, a Loan Notice, and (b) with respect to an L/C Credit
Extension, a Letter of Credit Application.

 

“Responsible Officer” means the chief executive officer or chief financial
officer of a Loan Party.  Any document delivered hereunder that is signed by a
Responsible Officer of a Loan Party shall be

 

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conclusively presumed to have been authorized by all necessary corporate,
partnership and/or other action on the part of such Loan Party and such
Responsible Officer shall be conclusively presumed to have acted on behalf of
such Loan Party.

 

“Restricted Payment” means any dividend or other distribution (whether in cash,
securities or other property) with respect to any Equity Interests of any
Person, or any payment (whether in cash, securities or other property),
including any sinking fund or similar deposit, on account of the purchase,
redemption, retirement, defeasance, acquisition, cancellation or termination of
any such Equity Interests or on account of any return of capital to such
Person’s stockholders, partners or members (or the equivalent Person thereof),
or any option, warrant or other right to acquire any such dividend or other
distribution or payment.

 

“Revolving Commitment” means the obligation of the Lender to make Revolving
Loans to the Borrower pursuant to Section 2.01 and L/C Credit Extensions for the
account of the Borrower pursuant to Section 2.02 in an aggregate principal
amount at any one time outstanding not to exceed the Revolving Commitment
Amount.

 

“Revolving Commitment Amount” means the amount of the Revolving Commitment in
effect from time to time.  The amount of the Revolving Commitment in effect on
the Closing Date is $35 million.

 

“Revolving Loan” has the meaning specified in Section 2.01(a).

 

“S&P” means Standard & Poor’s Ratings Services, a division of The McGraw-Hill
Companies, Inc. and any successor thereto.

 

“Sale and Leaseback Transaction” means, with respect to the Borrower or any
Subsidiary, any arrangement, directly or indirectly, with any Person whereby the
Borrower or such Subsidiary shall sell or transfer any property used or useful
in its business, whether now owned or hereafter acquired, and thereafter rent or
lease such property or other property that it intends to use for substantially
the same purpose or purposes as the property being sold or transferred.

 

“SEC” means the Securities and Exchange Commission, or any Governmental
Authority succeeding to any of its principal functions.

 

“Securitization Transaction” means, with respect to any Person, any financing
transaction or series of financing transactions (including factoring
arrangements) pursuant to which such Person or any Subsidiary of such Person may
sell, convey or otherwise transfer, or grant a security interest in, accounts,
payments, receivables, rights to future lease payments or residuals or similar
rights to payment to a special purpose subsidiary or affiliate of such Person.

 

“Subsidiary” of a Person means a corporation, partnership, joint venture,
limited liability company or other business entity of which a majority of the
shares of Voting Stock is at the time beneficially owned, or the management of
which is otherwise controlled, directly, or indirectly through one or more
intermediaries, or both, by such Person.  Unless otherwise specified, all
references herein to a “Subsidiary” or to “Subsidiaries” shall refer to a
Subsidiary or Subsidiaries of the Borrower.

 

“Swap Contract” means (a) any and all rate swap transactions, basis swaps,
credit derivative transactions, forward rate transactions, commodity swaps,
commodity options, forward commodity contracts, equity or equity index swaps or
options, bond or bond price or bond index swaps or options or forward bond or
forward bond price or forward bond index transactions, interest rate options,
forward

 

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foreign exchange transactions, cap transactions, floor transactions, collar
transactions, currency swap transactions, cross-currency rate swap transactions,
currency options, spot contracts, or any other similar transactions or any
combination of any of the foregoing (including any options to enter into any of
the foregoing), whether or not any such transaction is governed by or subject to
any master agreement, and (b) any and all transactions of any kind, and the
related confirmations, which are subject to the terms and conditions of, or
governed by, any form of master agreement published by the International Swaps
and Derivatives Association, Inc., any International Foreign Exchange Master
Agreement, or any other master agreement (any such master agreement, together
with any related schedules, a “Master Agreement”), including any such
obligations or liabilities under any Master Agreement.

 

“Swap Termination Value” means, in respect of any one or more Swap Contracts,
after taking into account the effect of any legally enforceable netting
agreement relating to such Swap Contracts, (a) for any date on or after the date
such Swap Contracts have been closed out and termination value(s) determined in
accordance therewith, such termination value(s) and (b) for any date prior to
the date referenced in clause (a), the amount(s) determined as the
mark-to-market value(s) for such Swap Contracts, as determined based upon one or
more mid-market or other readily available quotations provided by any recognized
dealer in such Swap Contracts (which may include the Lender or any Affiliate of
the Lender).

 

“Synthetic Lease” means any synthetic lease, tax retention operating lease,
off-balance sheet loan or similar off-balance sheet financing arrangement
whereby the arrangement is considered borrowed money indebtedness for tax
purposes but is classified as an operating lease or does not otherwise appear on
a balance sheet under GAAP.

 

“Taxes” means all present or future taxes, levies, imposts, duties, deductions,
withholdings (including backup withholding), assessments, fees or other charges
imposed by any Governmental Authority, including any interest, additions to tax
or penalties applicable thereto.

 

“Threshold Amount” means $5 million.

 

“Treasury Management Agreement” means any agreement governing the provision of
treasury or cash management services, including deposit accounts, overnight
draft, credit or debit cards, funds transfer, automated clearinghouse, zero
balance accounts, returned check concentration, controlled disbursement,
lockbox, account reconciliation and reporting and trade finance services and
other cash management services.

 

                “Type” means, with respect to any Loan, its character as a Base
Rate Loan or a Eurodollar Rate Loan.

 

“Unfunded Pension Liability” means the excess of a Pension Plan’s benefit
liabilities under Section 4001(a)(16) of ERISA, over the current value of that
Pension Plan’s assets, determined in accordance with the assumptions used for
funding that Pension Plan pursuant to Section 412 of the Internal Revenue Code
for the applicable plan year.

 

“United States” and “U.S.” mean the United States of America.

 

“Unreimbursed Amount” has the meaning specified in Section 2.03(c).

 

“Voting Stock” means, with respect to any Person, Equity Interests issued by
such Person the holders of which are ordinarily, in the absence of
contingencies, entitled to vote for the election of directors

 

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(or persons performing similar functions) of such Person, even though the right
so to vote has been suspended by the happening of such a contingency.

 

“Wholly Owned Subsidiary” means any Person 100% of whose Equity Interests are at
the time owned by the Borrower directly or indirectly through other Persons 100%
of whose Equity Interests are at the time owned, directly or indirectly, by the
Borrower.

 

1.02         OTHER INTERPRETIVE PROVISIONS.

 

With reference to this Agreement and each other Loan Document, unless otherwise
specified herein or in such other Loan Document:

 

(a)           The definitions of terms herein shall apply equally to the
singular and plural forms of the terms defined.  Whenever the context may
require, any pronoun shall include the corresponding masculine, feminine and
neuter forms.  The words “include,” “includes” and “including” shall be deemed
to be followed by the phrase “without limitation.”  The word “will” shall be
construed to have the same meaning and effect as the word “shall.”  Unless the
context requires otherwise, (i) any definition of or reference to any agreement,
instrument or other document (including any Organization Document) shall be
construed as referring to such agreement, instrument or other document as from
time to time amended, supplemented or otherwise modified (subject to any
restrictions on such amendments, supplements or modifications set forth herein
or in any other Loan Document), (ii) any reference herein to any Person shall be
construed to include such Person’s successors and assigns, (iii) the words
“herein,” “hereof” and “hereunder,” and words of similar import when used in any
Loan Document, shall be construed to refer to such Loan Document in its entirety
and not to any particular provision thereof, (iv) all references in a Loan
Document to Articles, Sections, Exhibits and Schedules shall be construed to
refer to Articles and Sections of, and Exhibits and Schedules to, the Loan
Document in which such references appear, (v) any reference to any law shall
include all statutory and regulatory provisions consolidating, amending,
replacing or interpreting such law and any reference to any law or regulation
shall, unless otherwise specified, refer to such law or regulation as amended,
modified or supplemented from time to time, and (vi) the words “asset” and
“property” shall be construed to have the same meaning and effect and to refer
to any and all tangible and intangible assets and properties, including cash,
securities, accounts and contract rights.

 

(b)           In the computation of periods of time from a specified date to a
later specified date, the word “from” means “from and including;” the words “to”
and “until” each mean “to but excluding;” and the word “through” means “to and
including.”

 

(c)           Section headings herein and in the other Loan Documents are
included for convenience of reference only and shall not affect the
interpretation of this Agreement or any other Loan Document.

 

1.03         ACCOUNTING TERMS.

 

(a)           Generally.  Except as otherwise specifically prescribed herein,
all accounting terms not specifically or completely defined herein shall be
construed in conformity with, and all financial data (including financial ratios
and other financial calculations) required to be submitted pursuant to this
Agreement shall be prepared in conformity with, GAAP.

 

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(b)           Changes in GAAP.  If at any time any change in GAAP would affect
the computation of any financial ratio or requirement set forth in any Loan
Document, and either the Borrower or the Lender shall so request, the Lender and
the Borrower shall negotiate in good faith to amend such ratio or requirement to
preserve the original intent thereof in light of such change in GAAP; provided
that, until so amended, (i) such ratio or requirement shall continue to be
computed in accordance with GAAP prior to such change therein and (ii) the
Borrower shall provide to the Lender financial statements and other documents
required under this Agreement or as reasonably requested hereunder setting forth
a reconciliation between calculations of such ratio or requirement made before
and after giving effect to such change in GAAP.

 

1.04         ROUNDING.

 

Any financial ratios required to be maintained by the Borrower pursuant to this
Agreement shall be calculated by dividing the appropriate component by the other
component, carrying the result to one place more than the number of places by
which such ratio is expressed herein and rounding the result up or down to the
nearest number (with a rounding-up if there is no nearest number).

 

1.05         TIMES OF DAY.

 

Unless otherwise specified, all references herein to times of day shall be
references to Eastern time (daylight or standard, as applicable).

 

1.06         LETTER OF CREDIT AMOUNTS.

 

Unless otherwise specified herein, the amount of a Letter of Credit at any time
shall be deemed to be the stated amount of such Letter of Credit in effect at
such time; provided, however, that with respect to any Letter of Credit that, by
its terms or the terms of any Issuer Document related thereto, provides for one
or more automatic increases in the stated amount thereof, the amount of such
Letter of Credit shall be deemed to be the maximum stated amount of such Letter
of Credit after giving effect to all such increases, whether or not such maximum
stated amount is in effect at such time.

 

ARTICLE II

 

THE COMMITMENT AND CREDIT EXTENSIONS

 

2.01         REVOLVING LOANS.

 

Subject to the terms and conditions set forth herein, the Lender agrees to make
loans (each such loan, a “Revolving Loan”) to the Borrower in Dollars from time
to time on any Business Day during the Availability Period; provided, however,
that after giving effect to any Borrowing of Revolving Loans, the aggregate
outstanding principal amount of all Revolving Loans and all L/C Obligations
shall not exceed the Revolving Commitment Amount.  Subject to the other terms
and conditions hereof, the Borrower may borrow under this Section 2.01, prepay
under Section 2.04, and reborrow under this Section 2.01.  Revolving Loans may
be Base Rate Loans or Eurodollar Rate Loans, as further provided herein.

 

2.02         BORROWINGS AND CONVERSIONS.

 

Each Borrowing and each conversion of Loans from one Type to the other shall be
made upon the Borrower’s irrevocable notice to the Lender, which may be given by
telephone.  Each such notice must be received by the Lender not later than
11:00 a.m. on the requested date of such Borrowing or conversion, as
applicable.  Each telephonic notice by the Borrower pursuant to this
Section 2.02 must be confirmed

 

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promptly by delivery to the Lender of a written Loan Notice, appropriately
completed and signed by a Responsible Officer of the Borrower.  Each Borrowing
and each conversion shall be in a principal amount of $100,000 or a whole
multiple of $100,000 in excess thereof.  Each Loan Notice (whether telephonic or
written) shall specify (i) whether the Borrower is requesting a Borrowing or a
conversion of Loans from one Type to the other, (ii) the requested date of the
Borrowing or conversion, as the case may be (which shall be a Business Day),
(iii) the principal amount of Loans to be borrowed or converted, and (iv) the
Type of Loans to be borrowed or to which existing Loans are to be converted.  If
the Borrower fails to specify a Type of a Loan in a Loan Notice, then the
applicable Loans shall be made as, or converted to, Eurodollar Rate Loans.  Upon
satisfaction of the applicable conditions set forth in Section 5.02 (and, if
such Borrowing is the initial Credit Extension, Section 5.01), the Lender shall
make the requested Loan available to the Borrower either by (i) crediting the
account of the Borrower on the books of Bank of America with the amount of such
funds or (ii) wire transfer of such funds, in each case in accordance with
instructions provided to (and reasonably acceptable to) the Lender by the
Borrower; provided, however, that if, on the date of a Borrowing of Revolving
Loans, there are L/C Borrowings outstanding, then the proceeds of such
Borrowing, first, shall be applied to the payment in full of any such L/C
Borrowings and second, shall be made available to the Borrower as provided
above.

 

2.03         LETTERS OF CREDIT.

 

(a)           The Letter of Credit Commitment.

 

(i)            Subject to the terms and conditions set forth herein, the Lender
agrees (A) from time to time on any Business Day during the period from the
Closing Date until the Letter of Credit Expiration Date, to issue Letters of
Credit in Dollars for the account of the Borrower or any Subsidiary, and to
amend or extend Letters of Credit previously issued by it, in accordance with
subsection (b) below, and (B) to honor drawings under the Letters of Credit;
provided that after giving effect to any L/C Credit Extension with respect to
any Letter of Credit, (x) the aggregate outstanding principal amount of all
Revolving Loans and all L/C Obligations shall not exceed the Revolving
Commitment Amount and (y) the outstanding principal amount of the L/C
Obligations shall not exceed the Letter of Credit Sublimit.  Each request by the
Borrower for the issuance or amendment of a Letter of Credit shall be deemed to
be a representation by the Borrower that the L/C Credit Extension so requested
complies with the conditions set forth in the proviso to the preceding
sentence.  Within the foregoing limits, and subject to the terms and conditions
hereof, the Borrower’s ability to obtain Letters of Credit shall be fully
revolving, and accordingly the Borrower may, during the foregoing period, obtain
Letters of Credit to replace Letters of Credit that have expired or that have
been drawn upon and reimbursed.

 

(ii)           The Lender shall not be under any obligation to issue any Letter
of Credit if:

 

(A)          subject to Section 2.03(b)(iii), the expiry date of such requested
Letter of Credit would occur more than twelve months after the date of issuance
or last extension;

 

(B)           the expiry date of such requested Letter of Credit would occur
after the Maturity Date;

 

(C)           any order, judgment or decree of any Governmental Authority or
arbitrator shall by its terms purport to enjoin or restrain the Lender from
issuing such Letter of Credit, or any Law applicable to the Lender or any
request or directive (whether or not having the force of law) from any
Governmental Authority with jurisdiction over the Lender shall prohibit, or
request that the Lender refrain from, the issuance of letters of credit
generally or such Letter of Credit in particular or shall impose upon the Lender

 

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with respect to such Letter of Credit any restriction, reserve or capital
requirement (for which the Lender is not otherwise compensated hereunder) not in
effect on the Closing Date, or shall impose upon the Lender any unreimbursed
loss, cost or expense which was not applicable on the Closing Date and which the
Lender in good faith deems material to it;

 

(D)          the issuance of such Letter of Credit would violate one or more
policies of the Lender; and

 

(E)           such Letter of Credit is to be denominated in a currency other
than Dollars.

 

(iii)          The Lender shall be under no obligation to amend any Letter of
Credit if (A) the Lender would have no obligation at such time to issue such
Letter of Credit in its amended form under the terms hereof or (B) the
beneficiary of such Letter of Credit does not accept the proposed amendment to
such Letter of Credit.

 

(b)           Procedures for Issuance and Amendment of Letters of Credit;
Auto-Extension Letters of Credit.

 

(i)            Each Letter of Credit shall be issued or amended, as the case may
be, upon the request of the Borrower delivered to the Lender in the form of a
Letter of Credit Application, appropriately completed and signed by a
Responsible Officer of the Borrower.  Such Letter of Credit Application must be
received by the Lender not later than 11:00 a.m. at least five (5) Business Days
(or such later date and time as the Lender may agree in a particular instance in
their sole discretion) prior to the proposed issuance date or date of amendment,
as the case may be.  In the case of a request for an initial issuance of a
Letter of Credit, such Letter of Credit Application shall specify in form and
detail satisfactory to the Lender: (A) the proposed issuance date of the
requested Letter of Credit (which shall be a Business Day); (B) the amount
thereof; (C) the expiry date thereof; (D) the name and address of the
beneficiary thereof; (E) the documents to be presented by such beneficiary in
case of any drawing thereunder; (F) the full text of any certificate to be
presented by such beneficiary in case of any drawing thereunder; (G) the purpose
and nature of the requested Letter of Credit; and (H) such other matters as the
Lender may require.  In the case of a request for an amendment of any
outstanding Letter of Credit, such Letter of Credit Application shall specify in
form and detail satisfactory to the Lender (A) the Letter of Credit to be
amended; (B) the proposed date of amendment thereof (which shall be a Business
Day); (C) the nature of the proposed amendment; and (D) such other matters as
the Lender may require.  Additionally, the Borrower shall furnish to the Lender
such other documents and information pertaining to such requested Letter of
Credit issuance or amendment, including any Issuer Documents, as the Lender may
require.

 

                (ii)           Unless one or more applicable conditions
contained in Article V shall not be satisfied on the requested date of issuance
or amendment of the applicable Letter of Credit, then, subject to the terms and
conditions hereof, the Lender shall, on the requested date, issue a Letter of
Credit for the account of the Borrower or the applicable Subsidiary or enter
into the applicable amendment, as the case may be, in each case in accordance
with the Lender’s usual and customary business practices.

 

                (iii)          If the Borrower so requests in any applicable
Letter of Credit Application, the Lender may, in its sole and absolute
discretion, agree to issue a Letter of Credit that has automatic extension
provisions (each, an “Auto-Extension Letter of Credit”); provided that any such

 

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Auto-Extension Letter of Credit must permit the Lender to prevent any such
extension at least once in each twelve-month period (commencing with the date of
issuance of such Letter of Credit) by giving prior notice to the beneficiary
thereof not later than a day (the “Non-Extension Notice Date”) in each such
twelve-month period to be agreed upon at the time such Letter of Credit is
issued.  Unless otherwise directed by the Lender, the Borrower shall not be
required to make a specific request to the Lender for any such extension.  The
Lender shall not be under any obligation to permit the extension of such Letter
of Credit if (A) the Lender has determined that it would have no obligation at
such time to issue such Letter of Credit in its revised form (as extended) under
the terms hereof (by reason of the provisions of clause (ii) or (iii) of
Section 2.03(a) or otherwise), or (B) one or more of the applicable conditions
specified in Section 5.02 is not then satisfied.

 

(iv)          If the Borrower so requests in any applicable Letter of Credit
Application, the Lender may, in its sole and absolute discretion, agree to issue
a Letter of Credit that permits the automatic reinstatement of all or a portion
of the stated amount thereof after any drawing thereunder (each, an
“Auto-Reinstatement Letter of Credit”).  Unless otherwise directed by the
Lender, the Borrower shall not be required to make a specific request to the
Lender to permit such reinstatement.  If such Auto-Reinstatement Letter of
Credit permits the Lender to decline to reinstate all or any portion of the
stated amount thereof after a drawing thereunder by giving notice of such
non-reinstatement within a specified number of days after such drawing (the
“Non-Reinstatement Deadline”), the Lender shall not be under any obligation to
permit such reinstatement if one or more of the applicable conditions specified
in Section 5.02 is not then satisfied (treating such reinstatement as an L/C
Credit Extension for purposes of this clause).

 

(v)           Promptly after its delivery of any Letter of Credit or any
amendment to a Letter of Credit to an advising bank with respect thereto or to
the beneficiary thereof, the Lender will also deliver to the Borrower a true and
complete copy of such Letter of Credit or amendment.

 

(c)           Drawings and Reimbursements.  Upon receipt from the beneficiary of
any Letter of Credit of any notice of drawing under such Letter of Credit, the
Lender shall notify the Borrower thereof. Not later than 11:00 a.m. on the date
of any payment by the Lender under a Letter of Credit (each such date, an “Honor
Date”), the Borrower shall reimburse the Lender in an amount equal to the amount
of such drawing. If the Borrower fails to so reimburse the Lender by such time,
the Borrower shall be deemed to have requested a Borrowing of Base Rate Loans to
be disbursed on the Honor Date in an amount equal to the amount of the
unreimbursed drawing (the “Unreimbursed Amount”), without regard to the minimum
and multiples specified in Section 2.02 for the principal amount of Base Rate
Loans, but subject to the conditions set forth in Section 5.02 (other than the
delivery of a Loan Notice) and provided that, after giving effect to such
Borrowing, the aggregate outstanding principal amount of all Revolving Loans and
all L/C Obligations shall not exceed the Revolving Commitment Amount. Any notice
given by the Lender pursuant to this Section 2.03(c) may be given by telephone
if immediately confirmed in writing; provided that the lack of such an immediate
confirmation shall not affect the conclusiveness or binding effect of such
notice.  With respect to any Unreimbursed Amount that is not fully refinanced by
a Borrowing of Base Rate Loans because the conditions set forth in Section 5.02
cannot be satisfied or for any other reason, the Borrower shall be deemed to
have incurred from the Lender an L/C Borrowing in the amount of the Unreimbursed
Amount that is not so refinanced, which L/C Borrowing shall be due and payable
on demand (together with interest) and shall bear interest at the Default Rate.

 

(d)           Obligations Absolute.  The obligation of the Borrower to reimburse
the Lender for each drawing under each Letter of Credit and to repay each L/C
Borrowing shall be absolute, unconditional and irrevocable, and shall be paid
strictly in accordance with the terms of this Agreement under all circumstances,
including the following:

 

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(i)            any lack of validity or enforceability of such Letter of Credit,
this Agreement or any other Loan Document;

 

(ii)           the existence of any claim, counterclaim, setoff, defense or
other right that the Borrower or any Subsidiary may have at any time against any
beneficiary or any transferee of such Letter of Credit (or any Person for whom
any such beneficiary or any such transferee may be acting), the Lender or any
other Person, whether in connection with this Agreement, the transactions
contemplated hereby or by such Letter of Credit or any agreement or instrument
relating thereto, or any unrelated transaction;

 

(iii)          any draft, demand, certificate or other document presented under
such Letter of Credit proving to be forged, fraudulent, invalid or insufficient
in any respect or any statement therein being untrue or inaccurate in any
respect; or any loss or delay in the transmission or otherwise of any document
required in order to make a drawing under such Letter of Credit;

 

(iv)          any payment by the Lender under such Letter of Credit against
presentation of a draft or certificate that does not strictly comply with the
terms of such Letter of Credit; or any payment made by the Lender under such
Letter of Credit to any Person purporting to be a trustee in bankruptcy,
debtor-in-possession, assignee for the benefit of creditors, liquidator,
receiver or other representative of or successor to any beneficiary or any
transferee of such Letter of Credit, including any arising in connection with
any proceeding under any Debtor Relief Law; or

 

(v)           any other circumstance or happening whatsoever, whether or not
similar to any of the foregoing, including any other circumstance that might
otherwise constitute a defense available to, or a discharge of, the Borrower or
any Subsidiary.

 

The Borrower shall promptly examine a copy of each Letter of Credit and each
amendment thereto that is delivered to it and, in the event of any claim of
noncompliance with the Borrower’s instructions or other irregularity, the
Borrower will immediately notify the Lender.  The Borrower shall be conclusively
deemed to have waived any such claim against the Lender and its correspondents
unless such notice is given as aforesaid.

 

(e)           Role of Lender.  The Borrower agrees that, in paying any drawing
under a Letter of Credit, the Lender shall not have any responsibility to obtain
any document (other than any sight draft, certificates and documents expressly
required by such Letter of Credit) or to ascertain or inquire as to the validity
or accuracy of any such document or the authority of the Person executing or
delivering any such document.  The Borrower hereby assumes all risks of the acts
or omissions of any beneficiary or transferee with respect to its use of any
Letter of Credit; provided, however, that this assumption is not intended to,
and shall not, preclude the Borrower’s pursuing such rights and remedies as it
may have against the beneficiary or transferee at law or under any other
agreement.  None of the Lender, any of its Related Parties nor any
correspondent, participant or assignee of the Lender shall be liable or
responsible for any of the matters described in clauses (i) through (v) of
Section 2.03(d); provided, however, that anything in such clauses to the
contrary notwithstanding, the Borrower may have a claim against the Lender, and
the Lender may be liable to the Borrower, to the extent, but only to the extent,
of any direct, as opposed to consequential or exemplary, damages suffered by the
Borrower which the Borrower proves were caused by the Lender’s willful
misconduct or gross negligence or the Lender’s willful failure to pay under any
Letter of Credit after the presentation to it by the beneficiary of a sight
draft and certificate(s) strictly complying with the terms and conditions of a
Letter of Credit.  In furtherance and not in limitation of the foregoing, the
Lender may accept documents that appear on their face to be in order, without
responsibility for further investigation, regardless of any notice or
information to the contrary, and the

 

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Lender shall not be responsible for the validity or sufficiency of any
instrument transferring or assigning or purporting to transfer or assign a
Letter of Credit or the rights or benefits thereunder or proceeds thereof, in
whole or in part, which may prove to be invalid or ineffective for any reason.

 

(f)            Cash Collateral.  If, as of the Maturity Date, any L/C Obligation
for any reason remains outstanding, the Borrower shall, in each case,
immediately Cash Collateralize the then outstanding principal amount of all L/C
Obligations.  Section 9.02(c) sets forth certain additional requirements to
deliver Cash Collateral hereunder.  For purposes of this Section 2.03 and
Section 9.02(c), “Cash Collateralize” means to pledge and deposit with or
deliver to the Lender, as collateral for the L/C Obligations, cash or deposit
account balances pursuant to documentation in form and substance satisfactory to
the Lender.  Derivatives of such term have corresponding meanings.  The Borrower
hereby grants to the Lender a security interest in all such cash, deposit
accounts and all balances therein and all proceeds of the foregoing.  Cash
Collateral shall be maintained in blocked, non-interest bearing deposit accounts
at Bank of America.

 

(g)           Applicability of ISP.  Unless otherwise expressly agreed by the
Lender and the Borrower when a Letter of Credit is issued, the rules of the ISP
shall apply to each Letter of Credit.

 

(h)           Letter of Credit Fees; Documentary and Processing Charges.  The
Borrower shall pay to the Lender a Letter of Credit fee (the “Letter of Credit
Fee”) for each Letter of Credit equal to the Applicable Rate for Eurodollar Rate
Loans times the daily amount available to be drawn under such Letter of Credit. 
For purposes of computing the daily amount available to be drawn under any
Letter of Credit, the amount of such Letter of Credit shall be determined in
accordance with Section 1.06.  Letter of Credit Fees shall be (i) due and
payable on the first Business Day after the end of each March, June,
September and December, commencing with the first such date to occur after the
issuance of such Letter of Credit and on the Maturity Date and (ii) computed on
a quarterly basis in arrears.  If there is any change in the Applicable Rate
during any quarter, the daily amount available to be drawn under each Letter of
Credit shall be computed and multiplied by the Applicable Rate separately for
each period during such quarter that such Applicable Rate was in effect. 
Notwithstanding anything to the contrary contained herein, while any Event of
Default exists, all Letter of Credit Fees shall accrue at the Default Rate.  In
addition, the Borrower shall pay directly to the Lender the customary issuance,
presentation, amendment and other processing fees, and other standard costs and
charges, of the Lender relating to letters of credit as from time to time in
effect.  Such customary fees and standard costs and charges are due and payable
on demand and are nonrefundable.

 

(i)            Conflict with Issuer Documents.  In the event of any conflict
between the terms hereof and the terms of any Issuer Document, the terms hereof
shall control.

 

(j)            Letters of Credit Issued for Subsidiaries.  Notwithstanding that
a Letter of Credit issued or outstanding hereunder is in support of any
obligations of, or is for the account of, a Subsidiary, the Borrower shall be
obligated to reimburse the Lender hereunder for any and all drawings under such
Letter of Credit.  The Borrower hereby acknowledges that the issuance of Letters
of Credit for the account of Subsidiaries inures to the benefit of the Borrower,
and that the Borrower’s business derives substantial benefits from the
businesses of such Subsidiaries.

 

2.04         PREPAYMENTS.

 

(a)           Voluntary Prepayments of Loans.  The Borrower may, upon notice
from the Borrower to the Lender, at any time or from time to time voluntarily
prepay Revolving Loans in whole or in part without premium or penalty; provided
that (A) such notice must be received by the Lender not later than 11:00 a.m. on
the date of prepayment; and (B) any such prepayment shall be in a principal
amount of

 

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$100,000 or a whole multiple of $100,000 in excess thereof (or, if less, the
entire principal amount thereof then outstanding).  Each such notice shall
specify the date and amount of such prepayment and the Type(s) of Loans to be
prepaid.  If such notice is given by the Borrower, the Borrower shall make such
prepayment and the payment amount specified in such notice shall be due and
payable on the date specified therein.

 

(b)           Mandatory Prepayments of Loans.  If for any reason the aggregate
outstanding principal amount of all Revolving Loans and all L/C Obligations at
any time exceeds the Revolving Commitment then in effect, the Borrower shall
immediately prepay Revolving Loans and/or Cash Collateralize the L/C Obligations
in an aggregate amount equal to such excess.

 

2.05         TERMINATION OR REDUCTION OF REVOLVING COMMITMENT.

 

The Borrower may, upon notice to the Lender, terminate the Revolving Commitment,
or from time to time permanently reduce the Revolving Commitment to an amount
not less than the outstanding principal amount of Revolving Loans and L/C
Obligations; provided that (i) any such notice shall be received by the Lender
not later than 12:00 noon five (5) Business Days prior to the date of
termination or reduction and (ii) any such partial reduction shall be in an
aggregate amount of $5,000,000 or any whole multiple of $1,000,000 in excess
thereof.  All fees accrued with respect thereto until the effective date of any
termination of the Revolving Commitment shall be paid on the effective date of
such termination.

 

2.06         REPAYMENT OF LOANS.

 

The Borrower shall repay to the Lender on the Maturity Date the aggregate
principal amount of all Revolving Loans outstanding on such date.

 

2.07         INTEREST.

 

(a)           Subject to the provisions of subsection (b) below, (i) each
Eurodollar Rate Loan shall bear interest on the outstanding principal amount
thereof from the applicable borrowing date at a rate per annum equal to the sum
of the Eurodollar Rate plus the Applicable Rate; and (ii) each Base Rate Loan
shall bear interest on the outstanding principal amount thereof from the
applicable borrowing date at a rate per annum equal to the Base Rate plus the
Applicable Rate.

 

(b)           While any Event of Default exists, the Borrower shall pay interest
on the principal amount of all outstanding Obligations hereunder at a
fluctuating interest rate per annum at all times equal to the Default Rate to
the fullest extent permitted by applicable Laws.

 

(c)           Interest on each Loan shall be due and payable in arrears on the
last Business Day of each calendar month and at such other times as may be
specified herein.  Interest hereunder shall be due and payable in accordance
with the terms hereof before and after judgment, and before and after the
commencement of any proceeding under any Debtor Relief Law.

 

2.08         COMMITMENT FEE.

 

The Borrower shall pay to the Lender a commitment fee equal to the product of
(i) the Applicable Rate times (ii) the actual daily amount by which the
Revolving Commitment exceeds the outstanding principal amount of Revolving Loans
and L/C Obligations. The commitment fee shall accrue at all times during the
Availability Period, including at any time during which one or more of the
conditions in Article V is not met, and shall be due and payable quarterly in
arrears on the last Business Day of each calendar quarter. The commitment fee
shall be calculated quarterly in arrears.

 

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2.9           COMPUTATION OF INTEREST AND FEES; RETROACTIVE ADJUSTMENTS OF
APPLICABLE RATE.

 

(a)           All computations of interest for Base Rate Loans when the Base
Rate is determined by Bank of America’s “prime rate” shall be made on the basis
of a year of 365 or 366 days, as the case may be, and actual days elapsed.  All
other computations of fees and interest shall be made on the basis of a 360-day
year and actual days elapsed (which results in more fees or interest, as
applicable, being paid than if computed on the basis of a 365-day year). 
Interest shall accrue on each Loan for the day on which the Loan is made, and
shall not accrue on a Loan, or any portion thereof, for the day on which the
Loan or such portion is paid, provided that any Loan that is repaid on the same
day on which it is made shall, subject to Section 2.11(a), bear interest for one
day.  Each determination by the Lender of an interest rate or fee hereunder
shall be conclusive and binding for all purposes, absent manifest error.

 

(b)           If, as a result of any restatement of or other adjustment to the
financial statements of the Borrower or for any other reason, (i) the
Consolidated Leverage Ratio as calculated by the Borrower as of any applicable
date was inaccurate and (ii) a proper calculation of the Consolidated Leverage
Ratio would have resulted in higher pricing for such period, the Borrower shall
immediately and retroactively be obligated to pay to the Lender promptly on
demand by the Lender (or, after the occurrence of an actual or deemed entry of
an order for relief with respect to the Borrower under the Bankruptcy Code of
the United States, automatically and without further action by the Lender), an
amount equal to the excess of the amount of interest and fees that should have
been paid for such period over the amount of interest and fees actually paid for
such period.  This paragraph shall not limit the rights of the Lender under any
other provision of this Agreement.  The Borrower’s obligations under this
paragraph shall survive the termination of the Revolving Commitment and the
repayment of all other Obligations hereunder.

 

2.10         EVIDENCE OF DEBT.

 

The Credit Extensions shall be evidenced by one or more accounts or records
maintained by the Lender in the ordinary course of business.  The accounts or
records maintained by the Lender shall be conclusive absent manifest error of
the amount of the Credit Extensions and the interest and payments thereon.  Any
failure to so record or any error in doing so shall not, however, limit or
otherwise affect the obligation of the Borrower hereunder to pay any amount
owing with respect to the Obligations.  Upon the request of the Lender, the
Borrower shall execute and deliver to the Lender a promissory note, which shall
evidence the Loans in addition to such accounts or records.  Such promissory
note shall be in the form of Exhibit 2.10 (a “Note”).  The Lender may attach
schedules to its Note and endorse thereon the date, Type (if applicable), amount
and maturity of its Loans and payments with respect thereto.

 

2.11         PAYMENTS GENERALLY.

 

(a)           General.  All payments to be made by the Borrower shall be made
without condition or deduction for any counterclaim, defense, recoupment or
setoff.  Except as otherwise expressly provided herein, all payments by the
Borrower hereunder shall be made to the Lender at the Lender’s Office in Dollars
and in immediately available funds not later than 2:00 p.m. on the date
specified herein.  All payments received by the Lender after 2:00 p.m. shall be
deemed received on the next succeeding Business Day and any applicable interest
or fee shall continue to accrue.  If any payment to be made by the Borrower
shall come due on a day other than a Business Day, payment shall be made on the
next following Business Day, and such extension of time shall be reflected on
computing interest or fees, as the case may be.

 

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(b)           Funding Source.  Nothing herein shall be deemed to obligate the
Lender to obtain the funds for any Loan in any particular place or manner or to
constitute a representation by the Lender that it has obtained or will obtain
the funds for any Loan in any particular place or manner.

 

ARTICLE III

 

TAXES, YIELD PROTECTION AND ILLEGALITY

 

3.01         TAXES.

 

(a)           Payments Free of Taxes – Obligation to Withhold: Payments on
Account of Taxes.  Any and all payments by or on account of any obligation of
the Loan Parties hereunder or under any other Loan Document shall to the extent
permitted by applicable Laws be made free and clear of and without reduction or
withholding for any Taxes. If, however, applicable Laws require the Loan Parties
to withhold or deduct any Tax, such Tax shall be withheld or deducted in
accordance with such Laws as determined by the Loan Parties upon the basis of
the information and documentation to be delivered pursuant to subsection
(e) below and, to the extent that the withholding or deduction is made on
account of Indemnified Taxes or Other Taxes, the sum payable by the Loan Parties
shall be increased as necessary so that after any required withholding or the
making of all required deductions (including deductions applicable to additional
sums payable under this Section) the Lender receives an amount equal to the sum
it would have received had no such withholding or deduction been made.

 

(b)           Payment of Other Taxes.  Without limiting the provisions of
subsection (a) above, the Loan Parties shall timely pay any Other Taxes to the
relevant Governmental Authority in accordance with applicable Laws.

 

(c)           Tax Indemnifications.  Without limiting the provisions of
subsection (a) or (b) above, the Loan Parties shall, and does hereby, indemnify
the Lender, and shall make payment in respect thereof within 10 days after
demand therefor, for the full amount of any Indemnified Taxes or Other Taxes
(including Indemnified Taxes or Other Taxes imposed or asserted on or
attributable to amounts payable under this Section) withheld or deducted by the
Loan Parties or paid by the Lender and any penalties, interest and reasonable
expenses arising therefrom or with respect thereto, whether or not such
Indemnified Taxes or Other Taxes were correctly or legally imposed or asserted
by the relevant Governmental Authority.  A certificate as to the amount of any
such payment or liability delivered to the Borrower by the Lender shall be
conclusive absent manifest error.

 

(d)           Evidence of Payments.  Upon request by the Lender, after any
payment of Taxes by any Loan Party to a Governmental Authority, as provided in
this Section 3.01, the Borrower shall deliver to the Lender the original or a
certified copy of a receipt issued by such Governmental Authority evidencing
such payment, a copy of any return required by Law to report such payment or
other evidence of such payment reasonably satisfactory to the Lender.

 

(e)           Status of Lender: Tax Documentation.

 

(i)            The Lender shall deliver to the Borrower, at the time or times
prescribed by applicable Laws or when reasonably requested by the Borrower, such
properly completed and executed documentation prescribed by applicable Laws or
by the taxing authorities of any jurisdiction and such other reasonably
requested information as will permit the Borrower to determine (A) whether or
not payments made hereunder or under any other Loan Document are subject to
Taxes, (B) if applicable, the required rate of withholding or deduction, and
(C) the Lender’s entitlement to any available exemption from, or reduction of,
applicable Taxes in

 

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respect of all payments to be made to the Lender by the Borrower pursuant to
this Agreement or otherwise to establish the Lender’s status for withholding tax
purposes in the applicable jurisdiction.

 

(ii)           Without limiting the generality of the foregoing, if the Borrower
is a resident for tax purposes in the United States, the Lender, if it is a
“United States person” within the meaning of Section 7701(a)(30) of the Internal
Revenue Code, shall deliver to the Borrower executed originals of Internal
Revenue Service Form W-9 or such other documentation or information prescribed
by applicable Laws or reasonably requested by the Borrower as will enable the
Borrower to determine whether or not the Lender is subject to backup withholding
or information reporting requirements; and

 

(iii)          The Lender shall promptly (A) notify the Borrower of any change
in circumstances which would modify or render invalid any claimed exemption or
reduction, and (B) take such steps as shall not be materially disadvantageous to
it, in the reasonable judgment of the Lender, and as may be reasonably necessary
(including the re-designation of the Lender’s Office) to avoid any requirement
of applicable Laws of any jurisdiction that the Borrower make any withholding or
deduction for taxes from amounts payable to the Lender.

 

3.02         ILLEGALITY.

 

If the Lender determines that any Law has made it unlawful, or that any
Governmental Authority has asserted that it is unlawful, for the Lender or the
Lender’s Office to make, maintain or fund Eurodollar Rate Loans, or to determine
or charge interest rates based upon the Eurodollar Rate, or any Governmental
Authority has imposed material restrictions on the authority of the Lender to
purchase or sell, or to take deposits of, Dollars in the London interbank
market, then, on notice thereof by the Lender to the Borrower, any obligation of
the Lender to make or continue Eurodollar Rate Loans or to convert Base Rate
Loans to Eurodollar Rate Loans shall be suspended until the Lender notifies the
Borrower that the circumstances giving rise to such determination no longer
exist.  Upon receipt of such notice, the Borrower shall, upon demand from the
Lender, prepay or, if applicable, convert all Eurodollar Rate Loans to Base Rate
Loans.  Upon any such prepayment or conversion, the Borrower shall also pay
accrued interest on the amount so prepaid or converted.

 

3.03         INABILITY TO DETERMINE RATES.

 

If the Lender determines that for any reason in connection with any request for
a Borrowing of, or conversion to, a Eurodollar Rate Loan that (a) Dollar
deposits are not being offered to banks in the London interbank eurodollar
market for the applicable amount of such Loan and for a one month interest
period, (b) adequate and reasonable means do not exist for determining the
Eurodollar Daily Floating Base Rate or (c) the Eurodollar Rate does not
adequately and fairly reflect the cost to the Lender of funding such Loan, the
Lender will promptly notify the Borrower.  Thereafter, the obligation of the
Lender to make or maintain Eurodollar Rate Loans shall be suspended until the
Lender revokes such notice.  Upon receipt of such notice, the Borrower may
revoke any pending request for a Borrowing of or conversion to Eurodollar Rate
Loans or, failing that, will be deemed to have converted such request into a
request for a Borrowing of Base Rate Loans in the amount specified therein.

 

3.04         SURVIVAL.

 

All of the Loan Parties’s obligations under this Article III shall survive
termination of the Revolving Commitment and repayment of all other Obligations
hereunder.

 

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ARTICLE IV

 

GUARANTY

 

4.01         THE GUARANTY.

 

Each of the Guarantors hereby jointly and severally guarantees to the Lender and
each other holder of the Obligations as hereinafter provided, as primary obligor
and not as surety, the prompt payment of the Obligations in full when due
(whether at stated maturity, as a mandatory prepayment, by acceleration, as a
mandatory cash collateralization or otherwise) strictly in accordance with the
terms thereof.  The Guarantors hereby further agree that if any of the
Obligations are not paid in full when due (whether at stated maturity, as a
mandatory prepayment, by acceleration, as a mandatory cash collateralization or
otherwise), the Guarantors will, jointly and severally, promptly pay the same,
without any demand or notice whatsoever, and that in the case of any extension
of time of payment or renewal of any of the Obligations, the same will be
promptly paid in full when due (whether at extended maturity, as a mandatory
prepayment, by acceleration, as a mandatory cash collateralization or otherwise)
in accordance with the terms of such extension or renewal.

 

Notwithstanding any provision to the contrary contained herein or in any other
of the Loan Documents or any other document relating to the Obligations, the
obligations of each Guarantor under this Agreement and the other Loan Documents
shall not exceed an aggregate amount equal to the largest amount that would not
render such obligations subject to avoidance under applicable Debtor Relief
Laws.

 

4.02         OBLIGATIONS UNCONDITIONAL.

 

The obligations of the Guarantors under Section 4.01 are joint and several,
absolute and unconditional, irrespective of the value, genuineness, validity,
regularity or enforceability of any of the Loan Documents or other documents
relating to the Obligations, or any substitution, release, impairment or
exchange of any other guarantee of or security for any of the Obligations, and,
to the fullest extent permitted by applicable law, irrespective of any other
circumstance whatsoever which might otherwise constitute a legal or equitable
discharge or defense of a surety or guarantor, it being the intent of this
Section 4.02 that the obligations of the Guarantors hereunder shall be absolute
and unconditional under any and all circumstances.  Each Guarantor agrees that
such Guarantor shall have no right of subrogation, indemnity, reimbursement or
contribution against the Borrower or any other Guarantor for amounts paid under
this Article IV until such time as the Obligations have been paid in full and
the Revolving Commitment has expired or terminated.  Without limiting the
generality of the foregoing, it is agreed that, to the fullest extent permitted
by Law, the occurrence of any one or more of the following shall not alter or
impair the liability of any Guarantor hereunder, which shall remain absolute and
unconditional as described above:

 

(a)           at any time or from time to time, without notice to any Guarantor,
the time for any performance of or compliance with any of the Obligations shall
be extended, or such performance or compliance shall be waived;

 

(b)           any of the acts mentioned in any of the provisions of any of the
Loan Documents, or any other document relating to the Obligations shall be done
or omitted;

 

(c)           the maturity of any of the Obligations shall be accelerated, or
any of the Obligations shall be modified, supplemented or amended in any
respect, or any right under any of the Loan Documents, or any other document
relating to the Obligations shall be waived or any other guarantee of any of the
Obligations or any security therefor shall be released, impaired or exchanged in
whole or in part or otherwise dealt with;

 

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(d)           any Lien granted to, or in favor of, the Lender or any other
holder of the Obligations as security for any of the Obligations shall fail to
attach or be perfected; or

 

(e)           any of the Obligations shall be determined to be void or voidable
(including, without limitation, for the benefit of any creditor of any
Guarantor) or shall be subordinated to the claims of any Person (including,
without limitation, any creditor of any Guarantor).

 

With respect to its obligations hereunder, each Guarantor hereby expressly
waives diligence, presentment, demand of payment, protest and all notices
whatsoever, and any requirement that the Lender or any other holder of the
Obligations exhaust any right, power or remedy or proceed against any Person
under any of the Loan Documents, or any other document relating to the
Obligations, or against any other Person under any other guarantee of, or
security for, any of the Obligations.

 

4.03         REINSTATEMENT.

 

The obligations of each Guarantor under this Article IV shall be automatically
reinstated if and to the extent that for any reason any payment by or on behalf
of any Person in respect of the Obligations is rescinded or must be otherwise
restored by any holder of any of the Obligations, whether as a result of any
Debtor Relief Law or otherwise, and each Guarantor agrees that it will indemnify
the Lender and each other holder of the Obligations on demand for all reasonable
costs and expenses (including, without limitation, the fees, charges and
disbursements of counsel) incurred by the Lender or such holder of the
Obligations in connection with such rescission or restoration, including any
such costs and expenses incurred in defending against any claim alleging that
such payment constituted a preference, fraudulent transfer or similar payment
under any Debtor Relief Law.

 

4.04         CERTAIN ADDITIONAL WAIVERS.

 

Each Guarantor agrees that such Guarantor shall have no right of recourse to
security for the Obligations, except through the exercise of rights of
subrogation pursuant to Section 4.02 and through the exercise of rights of
contribution pursuant to Section 4.06.

 

4.05         REMEDIES.

 

                The Guarantors agree that, to the fullest extent permitted by
law, as between the Guarantors, on the one hand, and the Lender and the other
holders of the Obligations, on the other hand, the Obligations may be declared
to be forthwith due and payable as specified in Section 9.02 (and shall be
deemed to have become automatically due and payable in the circumstances
specified in Section 9.02) for purposes of Section 4.01 notwithstanding any
stay, injunction or other prohibition preventing such declaration (or preventing
the Obligations from becoming automatically due and payable) as against any
other Person and that, in the event of such declaration (or the Obligations
being deemed to have become automatically due and payable), the Obligations
(whether or not due and payable by any other Person) shall forthwith become due
and payable by the Guarantors for purposes of Section 4.01.

 

4.06         RIGHTS OF CONTRIBUTION.

 

The Guarantors agree among themselves that, in connection with payments made
hereunder, each Guarantor shall have contribution rights against the other
Guarantors as permitted under applicable law.  Such contribution rights shall be
subordinate and subject in right of payment to the obligations of such
Guarantors under the Loan Documents and no Guarantor shall exercise such rights
of contribution until all Obligations have been paid in full and the Revolving
Commitment has terminated.

 

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4.07         GUARANTEE OF PAYMENT; CONTINUING GUARANTEE.

 

The guarantee in this Article IV is a guaranty of payment and not of collection,
is a continuing guarantee, and shall apply to all Obligations whenever arising.

 

ARTICLE V

 

CONDITIONS PRECEDENT TO CREDIT EXTENSIONS

 

5.01         CONDITIONS OF EFFECTIVENESS.

 

This Agreement shall be effective upon satisfaction of the following conditions
precedent:

 

(a)           Loan Documents.  Receipt by the Lender of executed counterparts of
this Agreement and the other Loan Documents, each properly executed by a
Responsible Officer of the signing Loan Party.

 

(b)           Opinions of Counsel. Receipt by the Lender of favorable opinions
of legal counsel to the Loan Parties, addressed to the Lender, dated as of the
Closing Date, and in form and substance satisfactory to the Lender.

 

(c)           Organization Documents, Resolutions, Etc.  Receipt by the Lender
of the following, in form and substance satisfactory to the Lender:

 

(i)            copies of the Organization Documents of each Loan Party which
shall be (A) in the case of the articles or certificate of incorporation or
formation, certified to be true and complete as of a recent date by the
appropriate Governmental Authority of the state or other jurisdiction of its
incorporation or organization, and (B) in all cases, certified by a secretary or
assistant secretary of such Loan Party to be true and correct as of the Closing
Date;

 

(ii)           such certificates of resolutions or other action, incumbency
certificates and/or other certificates of Responsible Officers of each Loan
Party as the Lender may require evidencing the identity, authority and capacity
of each Responsible Officer thereof authorized to act as a Responsible Officer
in connection with this Agreement and the other Loan Documents to which such
Loan Party is a party; and

 

(iii)          such documents and certifications as the Lender may reasonably
require to evidence that each Loan Party is duly organized or formed, and is
validly existing, in good standing and qualified to engage in business in its
state of organization or formation and the state of its principal place of
business.

 

(d)           Upfront Fee.  Payment by the Borrower to the Lender of an upfront
fee of $15,000.

 

(e)           Termination of Existing Revolving Credit Facility.  The Borrower
shall have terminated and repaid in full its existing revolving credit facility
with Bank of America.

 

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5.02         CONDITIONS TO ALL CREDIT EXTENSIONS.

 

The obligation of the Lender to honor any Request for Credit Extension is
subject to the following conditions precedent:

 

(a)           The representations and warranties of each Loan Party contained in
Article VI or any other Loan Document, or which are contained in any document
furnished at any time under or in connection herewith or therewith, shall be
true and correct in all material respects on and as of the date of such Credit
Extension, except to the extent that such representations and warranties
specifically refer to an earlier date, in which case they shall be true and
correct as of such earlier date.

 

(b)           No Default shall exist, or would result from such proposed Credit
Extension or from the application of the proceeds thereof.

 

(c)           The Lender shall have received a Request for Credit Extension in
accordance with the requirements hereof.

 

                Each Request for Credit Extension submitted by the Borrower
shall be deemed to be a representation and warranty that the conditions
specified in Sections 5.02(a) and (b) have been satisfied on and as of the date
of the applicable Credit Extension.

 

ARTICLE VI

 

REPRESENTATIONS AND WARRANTIES

 

The Loan Parties represent and warrant to the Lender that:

 

6.01         EXISTENCE, QUALIFICATION AND POWER.

 

The Borrower and each of its Subsidiaries (a) is duly organized or formed,
validly existing and, as applicable, in good standing under the Laws of the
jurisdiction of its incorporation or organization, (b) has all requisite power
and authority and all requisite governmental licenses, authorizations, consents
and approvals to (i) own or lease its assets and carry on its business and
(ii) execute, deliver and perform its obligations under the Loan Documents to
which it is a party, and (c) is duly qualified and is licensed and, as
applicable, in good standing under the Laws of each jurisdiction where its
ownership, lease or operation of properties or the conduct of its business
requires such qualification or license; except in each case referred to in
clause (b)(i) or (c), to the extent that failure to do so could not reasonably
be expected to have a Material Adverse Effect.

 

6.02         AUTHORIZATION; NO CONTRAVENTION.

 

The execution, delivery and performance by each Loan Party of each Loan Document
to which such Person is party have been duly authorized by all necessary
corporate or other organizational action, and do not (a) contravene the terms of
any of such Person’s Organization Documents; (b) conflict with or result in any
breach or contravention of, or the creation of any Lien under, or require any
payment to be made under (i) any contract, agreement or other instrument to
which such Person is a party or affecting such Person or the properties of such
Person or any of its Subsidiaries or  (ii) any order, injunction, writ or decree
of any Governmental Authority or any arbitral award to which such Person or its
property is subject; or (c) violate any Law.

 

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6.03         GOVERNMENTAL AUTHORIZATION; OTHER CONSENTS.

 

No approval, consent, exemption, authorization, or other action by, or notice
to, or filing with, any Governmental Authority or any other Person is necessary
or required in connection with the execution, delivery or performance by, or
enforcement against, any Loan Party of this Agreement or any other Loan Document
other than those that have already been obtained and are in full force and
effect.

 

6.04         BINDING EFFECT.

 

Each Loan Document has been duly executed and delivered by each Loan Party that
is party thereto.  Each Loan Document constitutes a legal, valid and binding
obligation of each Loan Party that is party thereto, enforceable against each
such Loan Party in accordance with its terms.

 

6.05         FINANCIAL STATEMENTS; NO MATERIAL ADVERSE EFFECT.

 

(a)           The Audited Financial Statements (i) were prepared in accordance
with GAAP consistently applied throughout the period covered thereby, except as
otherwise expressly noted therein; and (ii) fairly present the financial
condition of the Borrower and its Subsidiaries as of the date thereof and their
results of operations for the period covered thereby in accordance with GAAP
consistently applied throughout the period covered thereby, except as otherwise
expressly noted therein.

 

(b)           The Interim Financial Statements (i) were prepared in accordance
with GAAP consistently applied throughout the period covered thereby, except as
otherwise expressly noted therein; (ii) fairly present the financial condition
of the Borrower and its Subsidiaries as of the date thereof and their results of
operations for the period covered thereby, subject, in the case of clauses
(i) and (ii), to the absence of footnotes and to normal year-end audit
adjustments; and (iii) show all material indebtedness and other liabilities,
direct or contingent, of the Borrower and its Subsidiaries as of the date
thereof, including liabilities for taxes, material commitments and Indebtedness.

 

(c)           From the date of the Audited Financial Statements to and including
the Closing Date, there has been no Disposition or any Involuntary Disposition
of any material part of the business or property of the Borrower and its
Subsidiaries, taken as a whole, and no purchase or other acquisition by any of
them of any business or property (including any Equity Interests of any other
Person) material in relation to the consolidated financial condition of the
Borrower and its Subsidiaries, taken as a whole, in each case, which is not
reflected in the foregoing financial statements or in the notes thereto and has
not otherwise been disclosed in writing to the Lender on or prior to the Closing
Date.

 

(d)           The financial statements delivered pursuant to Section 7.01(a) and
(b) have been prepared in accordance with GAAP (except as may otherwise be
permitted under Section 7.01(a) and (b)) and present fairly (on the basis
disclosed in the footnotes to such financial statements) the consolidated and,
in the case of annual financial statements delivered pursuant to
Section 7.01(a), consolidating, financial condition, results of operations and
cash flows of the Borrower and its Subsidiaries as of the dates thereof and for
the periods covered thereby.

 

(e)           Since the date of the Audited Financial Statements, there has been
no event or circumstance that has had or could reasonably be expected to have a
Material Adverse Effect.

 

6.06         LITIGATION.

 

There are no actions, suits, proceedings, claims or disputes pending or, to the
knowledge of the Loan Parties after due and diligent investigation, threatened
or contemplated, at law, in equity, in

 

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arbitration or before any Governmental Authority, by or against the Borrower or
any Subsidiary or against any of their properties or revenues that (a) purport
to affect or pertain to this Agreement or any other Loan Document, or any of the
transactions contemplated hereby or (b) could reasonably be expected to have a
Material Adverse Effect.

 

6.07         NO DEFAULT.

 

                                                No Default has occurred and is
continuing.

 

6.08         OWNERSHIP OF PROPERTY; LIENS.

 

Each of the Borrower and its Subsidiaries has good record and marketable title
in fee simple to, or valid leasehold interests in, all real property necessary
or used in the ordinary conduct of its business, except for such defects in
title as could not reasonably be expected to have a Material Adverse Effect. 
The property of the Borrower and its Subsidiaries is not subject to any Liens
other than Permitted Liens.

 

6.09         ENVIRONMENTAL COMPLIANCE.

 

(a)           The Borrower and its Subsidiaries conduct in the ordinary course
of business a review of the effect of existing Environmental Laws and claims
alleging potential liability or responsibility for violation of any
Environmental Law on their respective businesses, operations and properties, and
as a result thereof the Loan Parties have reasonably concluded that such
Environmental Laws and claims could not, individually or in the aggregate,
reasonably be expected to have a Material Adverse Effect.

 

(b)           None of the properties currently or formerly owned or operated by
the Borrower or any Subsidiary is listed or proposed for listing on the National
Priorities List under CERCLA or on the CERCLIS or any analogous foreign, state
or local list or is adjacent to any such property; there are no and never have
been any underground or above-ground storage tanks or any surface impoundments,
septic tanks, pits, sumps or lagoons in which Hazardous Materials are being or
have been treated, stored or disposed on any property currently owned or
operated by the Borrower or any Subsidiary or, to the best of the knowledge of
the Loan Parties, on any property formerly owned or operated by the Borrower or
any Subsidiary; there is no asbestos or asbestos-containing material on any
property currently owned or operated by the Borrower or any Subsidiary; and
Hazardous Materials have not been released, discharged or disposed of on any
property currently or formerly owned or operated by the Borrower or any
Subsidiary.

 

(c)           Neither the Borrower nor any Subsidiary is undertaking, and has
not completed, either individually or together with other potentially
responsible parties, any investigation or assessment or remedial or response
action relating to any actual or threatened release, discharge or disposal of
Hazardous Materials at any site, location or operation, either voluntarily or
pursuant to the order of any Governmental Authority or the requirements of any
Environmental Law; and all Hazardous Materials generated, used, treated, handled
or stored at, or transported to or from, any property currently or formerly
owned or operated by the Borrower or any Subsidiary have been disposed of in a
manner not reasonably expected to result in material liability to the Borrower
or any Subsidiary.

 

6.10         INSURANCE.

 

The properties of the Borrower and its Subsidiaries are insured with financially
sound and reputable insurance companies not Affiliates of the Borrower, in such
amounts, with such deductibles and covering such risks as are customarily
carried by companies engaged in similar businesses and owning similar properties
in localities where the Borrower or the applicable Subsidiary operates.

 

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6.11         TAXES.

 

The Borrower and its Subsidiaries have filed all federal, state and other
material tax returns and reports required to be filed, and have paid all
federal, state and other material taxes, assessments, fees and other
governmental charges levied or imposed upon them or their properties, income or
assets otherwise due and payable, except those which are being contested in good
faith by appropriate proceedings diligently conducted and for which adequate
reserves have been provided in accordance with GAAP.  There is no proposed tax
assessment against the Borrower or any Subsidiary that would, if made, have a
Material Adverse Effect.  Neither the Borrower nor any Subsidiary is party to
any tax sharing agreement.

 

6.12         ERISA COMPLIANCE.

 

(a)           Each Plan is in compliance in all material respects with the
applicable provisions of ERISA, the Internal Revenue Code and other federal or
state Laws.  Each Plan that is intended to qualify under Section 401(a) of the
Internal Revenue Code has received a favorable determination letter from the IRS
or an application for such a letter is currently being processed by the IRS with
respect thereto and, to the best knowledge of the Loan Parties, nothing has
occurred which would prevent, or cause the loss of, such qualification.  Each
Loan Party and each ERISA Affiliate have made all required contributions to each
Plan subject to Section 412 of the Internal Revenue Code, and no application for
a funding waiver or an extension of any amortization period pursuant to
Section 412 of the Internal Revenue Code has been made with respect to any Plan.

 

(b)           There are no pending or, to the best knowledge of the Loan
Parties, threatened claims, actions or lawsuits, or action by any Governmental
Authority, with respect to any Plan that could be reasonably be expected to have
a Material Adverse Effect.  There has been no prohibited transaction or
violation of the fiduciary responsibility rules with respect to any Plan that
has resulted or could reasonably be expected to result in a Material Adverse
Effect.

 

(c)           (i)  No ERISA Event has occurred or is reasonably expected to
occur; (ii) no Pension Plan has any Unfunded Pension Liability; (iii) no Loan
Party or any ERISA Affiliate has incurred, or reasonably expects to incur, any
liability under Title IV of ERISA with respect to any Pension Plan (other than
premiums due and not delinquent under Section 4007 of ERISA); (iv) no Loan Party
or any ERISA Affiliate has incurred, or reasonably expects to incur, any
liability (and no event has occurred which, with the giving of notice under
Section 4219 of ERISA, would result in such liability) under Section 4201 or
4243 of ERISA with respect to a Multiemployer Plan; and (v) no Loan Party or any
ERISA Affiliate has engaged in a transaction that could be subject to
Section 4069 or 4212(c) of ERISA.

 

6.13         SUBSIDIARIES.

 

Set forth on Schedule 6.13 is a complete and accurate list as of the Closing
Date of each Subsidiary, together with (i) jurisdiction of organization and
(ii) percentage of outstanding shares of each class owned (directly or
indirectly) by the Borrower or any Subsidiary.  The outstanding Equity Interests
of each Subsidiary are validly issued, fully paid and non-assessable.

 

6.14         MARGIN REGULATIONS; INVESTMENT COMPANY ACT.

 

(a)           The Borrower is not engaged and will not engage, principally or as
one of its important activities, in the business of purchasing or carrying
margin stock (within the meaning of Regulation U issued by the FRB), or
extending credit for the purpose of purchasing or carrying margin stock.

 

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(b)           None of the Borrower, any Person Controlling the Borrower, or any
Subsidiary is or is required to be registered as an “investment company” under
the Investment Company Act of 1940.

 

6.15         DISCLOSURE.

 

No report, financial statement, certificate or other information furnished
(whether in writing or orally) by or on behalf of any Loan Party to the Lender
in connection with the transactions contemplated hereby and the negotiation of
this Agreement or delivered hereunder or under any other Loan Document (in each
case, as modified or supplemented by other information so furnished) contains
any material misstatement of fact or omits to state any material fact necessary
to make the statements therein, in the light of the circumstances under which
they were made, not misleading; provided that, with respect to projected
financial information, the Loan Parties represent only that such information was
prepared in good faith based upon assumptions believed to be reasonable at the
time.

 

6.16         COMPLIANCE WITH LAWS.

 

Each of the Borrower and each Subsidiary is in compliance with the requirements
of all Laws and all orders, writs, injunctions and decrees applicable to it or
to its properties, except in such instances in which (a) such requirement of Law
or order, writ, injunction or decree is being contested in good faith by
appropriate proceedings diligently conducted or (b) the failure to comply
therewith could not reasonably be expected to have a Material Adverse Effect.

 

6.17         INTELLECTUAL PROPERTY; LICENSES, ETC.

 

The Borrower and its Subsidiaries own, or possess the legal right to use, all of
the trademarks, service marks, trade names, copyrights, patents, patent rights,
franchises, licenses and other intellectual property rights (collectively, “IP
Rights”) that are reasonably necessary for the operation of their respective
businesses.

 

6.18         SOLVENCY.

 

The Loan Parties are Solvent on a consolidated basis.

 

6.19         LABOR MATTERS.

 

There are no collective bargaining agreements or Multiemployer Plans covering
the employees of the Borrower or any Subsidiary as of the Closing Date and
neither the Borrower nor any Subsidiary has suffered any strikes, walkouts, work
stoppages or other material labor difficulty in the five years preceding the
Closing Date.

 

ARTICLE VII

 

AFFIRMATIVE COVENANTS

 

                So long as the Revolving Commitment is outstanding, any Loan or
other Obligation hereunder shall remain unpaid or unsatisfied, or any Letter of
Credit shall remain outstanding, the Loan Parties shall and shall cause each
Subsidiary to:

 

7.01         FINANCIAL STATEMENTS.

 

Deliver to the Lender, in form and detail satisfactory to the Lender:

 

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(a)           as soon as available, but in any event within ninety days after
the end of each fiscal year of the Borrower, a consolidated balance sheet of the
Borrower and its Subsidiaries as at the end of such fiscal year, and the related
consolidated statements of income or operations, changes in shareholders’ equity
and cash flows for such fiscal year, setting forth in each case in comparative
form the figures for the previous fiscal year, all in reasonable detail and
prepared in accordance with GAAP, audited and accompanied by a report and
opinion of an independent certified public accountant of nationally recognized
standing reasonably acceptable to the Lender, which report and opinion shall be
prepared in accordance with generally accepted auditing standards and shall not
be subject to any “going concern” or like qualification or exception or any
qualification or exception as to the scope of such audit; and

 

(b)           as soon as available, but in any event within forty-five days
after the end of each of the first three fiscal quarters of each fiscal year of
the Borrower, a consolidated and consolidating balance sheet of the Borrower and
its Subsidiaries as at the end of such fiscal quarter, the related consolidated
and consolidating statements of income or operations for such fiscal quarter and
for the portion of the Borrower’s fiscal year then ended, and the related
consolidated and consolidating statements of changes in shareholders’ equity and
cash flows, setting forth in comparative form, as applicable, the figures for
the corresponding fiscal quarter of the previous fiscal year and the
corresponding portion of the previous fiscal year, all in reasonable detail and
certified by a Responsible Officer of the Borrower as fairly presenting the
financial condition, results of operations, shareholders’ equity and cash flows
of the Borrower and its Subsidiaries in accordance with GAAP, subject only to
normal year-end audit adjustments and the absence of footnotes.

 

As to any information contained in materials furnished pursuant to
Section 7.02(c), the Borrower shall not be separately required to furnish such
information under clause (a) or (b) above, but the foregoing shall not be in
derogation of the obligation of the Borrower to furnish the information and
materials described in clauses (a) and (b) above at the times specified therein.

 

7.02         CERTIFICATES; OTHER INFORMATION.

 

Deliver to the Lender, in form and detail satisfactory to the Lender:

 

(a)           concurrently with the delivery of the financial statements
referred to in Sections 7.01(a) and (b), a duly completed Compliance Certificate
signed by a Responsible Officer of the Borrower;

 

(b)           at least 30 days prior to the end of each fiscal year of the
Borrower, beginning with the fiscal year ending December 31, 2008, an annual
business plan and budget of the Borrower and its Subsidiaries containing, among
other things, pro forma financial statements for each quarter of the next fiscal
year;

 

(c)           promptly after the same are available, copies of each annual
report, proxy or financial statement or other report or communication sent to
the equityholders of the Borrower or any Subsidiary, and copies of all annual,
regular, periodic and special reports and registration statements which the
Borrower or any Subsidiary may file or be required to file with the SEC under
Section 13 or 15(d) of the Securities Exchange Act of 1934, and not otherwise
required to be delivered to the Lender pursuant hereto;

 

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(d)           promptly after any request by the Lender, copies of any detailed
audit reports, management letters or recommendations submitted to the board of
directors (or the audit committee of the board of directors) of the Borrower by
independent accountants in connection with the accounts or books of the Borrower
or any Subsidiary, or any audit of any of them;

 

(e)           promptly, and in any event within five Business Days after receipt
thereof by the Borrower or any Subsidiary, copies of each notice or other
correspondence received from the SEC (or comparable agency in any applicable
non-U.S. jurisdiction) concerning any investigation or possible investigation or
other inquiry by such agency regarding financial or other operational results of
the Borrower or any Subsidiary; and

 

(f)            promptly, such additional information regarding the business,
financial or corporate affairs of the Borrower or any Subsidiary, or compliance
with the terms of the Loan Documents, as the Lender may from time to time
reasonably request.

 

Documents required to be delivered pursuant to Section 7.01(a) or (b) or
Section 7.02(c) (to the extent any such documents are included in materials
otherwise filed with the SEC) may be delivered electronically and if so
delivered, shall be deemed to have been delivered on the date (i) on which the
Borrower posts such documents, or provides a link thereto on the Borrower’s
website on the Internet at the website address listed on Schedule 10.02; or
(ii) on which such documents are posted on the Borrower’s behalf on an Internet
or intranet website, if any, to which the Lender has access.

 

7.03         NOTICES.

 

(a)           Promptly notify the Lender of the occurrence of any Default.

 

(b)           Promptly notify the Lender of any matter that has resulted or
could reasonably be expected to result in a Material Adverse Effect.

 

(c)           Promptly notify the Lender of any material change in accounting
policies or financial reporting practices by the Borrower or any Subsidiary.

 

Each notice pursuant to this Section 7.03 shall be accompanied by a statement of
a Responsible Officer of the Borrower setting forth details of the occurrence
referred to therein and stating what action the Borrower has taken and proposes
to take with respect thereto.

 

7.04         PAYMENT OF TAXES

 

Pay and discharge, as the same shall become due and payable, all its tax
liabilities, assessments and governmental charges or levies upon it or its
properties or assets, unless the same are being contested in good faith by
appropriate proceedings diligently conducted and adequate reserves in accordance
with GAAP are being maintained by the Borrower or such Subsidiary.

 

7.05         PRESERVATION OF EXISTENCE, ETC.

 

(a)           Preserve, renew and maintain in full force and effect its legal
existence under the Laws of the jurisdiction of its organization except in a
transaction permitted by Section 8.04 or 8.05.

 

(b)           Preserve, renew and maintain in full force and effect its good
standing under the Laws of the jurisdiction of its organization except in a
transaction permitted by Section 8.04 or 8.05.

 

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(c)           Take all reasonable action to maintain all rights, privileges,
permits, licenses and franchises necessary or desirable in the normal conduct of
its business, except to the extent that the failure to do so could not
reasonably be expected to have a Material Adverse Effect.

 

(d)           Preserve or renew all of its IP Rights, the non-preservation of
which could reasonably be expected to have a Material Adverse Effect.

 

7.06         MAINTENANCE OF PROPERTIES.

 

(a)           Maintain, preserve and protect all of its material properties and
equipment necessary in the operation of its business in good working order and
condition, ordinary wear and tear excepted.

 

(b)           Make all necessary repairs thereto and renewals and replacements
thereof, except where the failure to do so could not reasonably be expected to
have a Material Adverse Effect.

 

(c)           Use the standard of care typical in the industry in the operation
and maintenance of its facilities.

 

7.07         MAINTENANCE OF INSURANCE.

 

                Maintain in full force and effect insurance with financially
sound and reputable insurance companies not Affiliates of the Borrower, in such
amounts, with such deductibles and covering such risks as are customarily
carried by companies engaged in similar businesses and owning similar properties
in localities where the Borrower or the applicable Subsidiary operates.

 

7.08         COMPLIANCE WITH LAWS.

 

Comply with the requirements of all Laws and all orders, writs, injunctions and
decrees applicable to it or to its business or property, except in such
instances in which (a) such requirement of Law or order, writ, injunction or
decree is being contested in good faith by appropriate proceedings diligently
conducted; or (b) the failure to comply therewith could not reasonably be
expected to have a Material Adverse Effect.

 

7.09         BOOKS AND RECORDS.

 

(a)           Maintain proper books of record and account, in which full, true
and correct entries in conformity with GAAP consistently applied shall be made
of all financial transactions and matters involving the assets and business of
the Borrower or such Subsidiary, as the case may be.

 

(b)           Maintain such books of record and account in material conformity
with all applicable requirements of any Governmental Authority having regulatory
jurisdiction over the Borrower or such Subsidiary, as the case may be.

 

7.10         INSPECTION RIGHTS.

 

Permit representatives and independent contractors of the Lender to visit and
inspect any of its properties, to examine its corporate, financial and operating
records, and make copies thereof or abstracts therefrom, and to discuss its
affairs, finances and accounts with its directors, officers, and independent
public accountants, all at the expense of the Borrower and at such reasonable
times during normal business hours and as often as may be reasonably desired,
upon reasonable advance notice to the Borrower; provided, however, that when an
Event of Default exists the Lender (or any of its

 

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representatives or independent contractors) may do any of the foregoing at the
expense of the Borrower at any time during normal business hours and without
advance notice.

 

7.11         USE OF PROCEEDS.

 

Use the proceeds of the Credit Extensions to finance short term working capital
and other lawful corporate purposes, provided that in no event shall the
proceeds of the Credit Extensions be used in contravention of any Law or of any
Loan Document.

 

7.12         ADDITIONAL DOMESTIC SUBSIDIARIES.

 

Within thirty (30) days after any Person becomes a Material Domestic Subsidiary,
cause such Person to (i) become a Guarantor by executing and delivering to the
Lender a Joinder Agreement or such other documents as the Lender shall deem
appropriate for such purpose, and (ii) upon the request of the Lender, deliver
to the Lender such Organization Documents, resolutions and favorable opinions of
counsel, all in form, content and scope reasonably satisfactory to the Lender.

 

7.13         MAINTENACE OF PRIMARY DEPOSITORY ACCOUNTS WITH THE LENDER.

 

Maintain the primary deposit accounts of the Borrower and its Domestic
Subsidiaries with the Lender.

 

ARTICLE VIII

 

NEGATIVE COVENANTS

 

So long as the Revolving Commitment is outstanding, any Loan or other Obligation
hereunder shall remain unpaid or unsatisfied, or any Letter of Credit shall
remain outstanding, no Loan Party shall, nor shall it permit any Subsidiary to,
directly or indirectly, without the consent of the Lender:

 

8.01         LIENS.

 

Create, incur, assume or suffer to exist any Lien upon any of its property,
assets or revenues, whether now owned or hereafter acquired, other than the
following:

 

(a)           Liens pursuant to any Loan Document;

 

(b)           Liens existing on the date hereof and listed on Schedule 8.01 and
any renewals or extensions thereof, provided that the property covered thereby
is not changed;

 

(c)           Liens (other than Liens imposed under ERISA) for taxes,
assessments or governmental charges or levies not yet due or which are being
contested in good faith and by appropriate proceedings diligently conducted, if
adequate reserves with respect thereto are maintained on the books of the
applicable Person in accordance with GAAP;

 

(d)           statutory Liens of landlords and Liens of carriers, warehousemen,
mechanics, materialmen and suppliers and other Liens imposed by law or pursuant
to customary reservations or retentions of title arising in the ordinary course
of business, provided that such Liens secure only amounts not yet due and
payable or, if due and payable, are unfiled and no other action has been taken
to enforce the same or are being contested in good faith by appropriate
proceedings for which adequate reserves determined in accordance with GAAP have
been established;

 

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(e)           pledges or deposits in the ordinary course of business in
connection with workers’ compensation, unemployment insurance and other social
security legislation, other than any Lien imposed by ERISA;

 

(f)            deposits to secure the performance of bids, trade contracts and
leases (other than Indebtedness), statutory obligations, surety and appeal
bonds, performance bonds and other obligations of a like nature incurred in the
ordinary course of business;

 

(g)           easements, rights-of-way, restrictions and other similar
encumbrances affecting real property which, in the aggregate, are not
substantial in amount, and which do not in any case materially detract from the
value of the property subject thereto or materially interfere with the ordinary
conduct of the business of the applicable Person;

 

(h)           Liens securing judgments for the payment of money (or appeal or
other surety bonds relating to such judgments) not constituting an Event of
Default under Section 9.01(h);

 

(i)            Liens securing Indebtedness permitted under Section 8.03(d);
provided that (i) such Liens do not at any time encumber any property other than
the property financed by such Indebtedness and (ii) such Liens attach to such
property concurrently with or within ninety days after the acquisition thereof;

 

(j)            leases or subleases granted to others not interfering in any
material respect with the business of the Borrower or any Subsidiary;

 

(k)           any interest of title of a lessor under, and Liens arising from
UCC financing statements (or equivalent filings, registrations or agreements in
foreign jurisdictions) relating to, leases permitted by this Agreement;

 

(l)            Liens deemed to exist in connection with Investments in
repurchase agreements permitted under Section 8.02;

 

(m)          normal and customary rights of setoff upon deposits of cash in
favor of banks or other depository institutions; and

 

(n)           Liens of a collection bank arising under Section 4-210 of the
Uniform Commercial Internal Revenue Code on items in the course of collection.

 

8.02         INVESTMENTS.

 

Make any Investments, except:

 

(a)           Investments in the form of cash or Cash Equivalents;

 

(b)           Investments existing as of the Closing Date and set forth in
Schedule 8.02;

 

(c)           Investments in any Person that is a Loan Party prior to giving
effect to such Investment;

 

(d)           Investments by any Foreign Subsidiary in any other Foreign
Subsidiary;

 

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(e)           Investments consisting of extensions of credit in the nature of
accounts receivable or notes receivable arising from the grant of trade credit
in the ordinary course of business, and Investments received in satisfaction or
partial satisfaction thereof from financially troubled account debtors to the
extent reasonably necessary in order to prevent or limit loss;

 

(f)            Guarantees permitted by Section 8.03; and

 

(g)           Investments of a nature not contemplated in the foregoing clauses
in an amount not to exceed $5 million in the aggregate at any time outstanding.

 

8.03         INDEBTEDNESS.

 

Create, incur, assume or suffer to exist any Indebtedness, except:

 

(a)           Indebtedness under the Loan Documents;

 

(b)           intercompany Indebtedness permitted under Section 8.02;

 

(c)           obligations (contingent or otherwise) existing or arising under
any Swap Contract, provided that (i) such obligations are (or were) entered into
by such Person in the ordinary course of business for the purpose of directly
mitigating risks associated with liabilities, commitments, investments, assets,
or property held or reasonably anticipated by such Person, or changes in the
value of securities issued by such Person, and not for purposes of speculation
or taking a “market view;” and (ii) such Swap Contract does not contain any
provision exonerating the non-defaulting party from its obligation to make
payments on outstanding transactions to the defaulting party;

 

(d)           purchase money Indebtedness (including obligations in respect of
Capital Leases or Synthetic Leases) hereafter incurred to finance the purchase
of fixed assets, and renewals, refinancings and extensions thereof, provided
that (i) the aggregate outstanding principal amount of all such Indebtedness
shall not exceed $10 million at any one time outstanding; and (ii) such
Indebtedness when incurred shall not exceed the purchase price of the
asset(s) financed; and

 

(e)           Guarantees with respect to Indebtedness permitted under this
Section 8.03.

 

8.04         FUNDAMENTAL CHANGES.

 

Merge, dissolve, liquidate or consolidate with or into another Person, except
that so long as no Default exists or would result therefrom, (a) the Borrower
may merge or consolidate with any of its Subsidiaries provided that the Borrower
is the continuing or surviving Person, (b) any Subsidiary may merge or
consolidate with any other Subsidiary provided that if a Loan Party is a party
to such transaction, the continuing or surviving Person is a Loan Party, and
(c) any Subsidiary may dissolve, liquidate or wind up its affairs at any time
provided that such dissolution, liquidation or winding up, as applicable, could
not have a Material Adverse Effect.

 

8.05         DISPOSITIONS.

 

Make any Disposition unless (i) the consideration paid in connection therewith
shall be cash or Cash Equivalents paid contemporaneous with consummation of the
transaction and shall be in an amount not less than the fair market value of the
property disposed of, (ii) if such transaction is a Sale and Leaseback
Transaction, such transaction is not prohibited by the terms of Section 8.15,
(iii) such transaction does not

 

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involve the sale or other disposition of a minority equity interest in any
Subsidiary, (iv) such transaction does not involve a sale or other disposition
of receivables other than receivables owned by or attributable to other property
concurrently being disposed of in a transaction otherwise permitted under this
Section 8.05, and (v) the aggregate net book value of all of the assets sold or
otherwise disposed of by the Borrower and its Subsidiaries in all such
transactions in any fiscal year of the Borrower shall not exceed $5 million.

 

8.06         RESTRICTED PAYMENTS.

 

Declare or make, directly or indirectly, any Restricted Payment, or incur any
obligation (contingent or otherwise) to do so, except that:

 

(a)           each Subsidiary may make Restricted Payments to Persons that own
Equity Interests in such Subsidiary, ratably according to their respective
holdings of the type of Equity Interest in respect of which such Restricted
Payment is being made; and

 

(b)           the Borrower and each Subsidiary may declare and make dividend
payments or other distributions payable solely in common Equity Interests of
such Person.

 

8.07         CHANGE IN NATURE OF BUSINESS.

 

Engage in any material line of business substantially different from those lines
of business conducted by the Borrower and its Subsidiaries on the Closing Date
or any business substantially related or incidental thereto.

 

8.08         TRANSACTIONS WITH AFFILIATES AND INSIDERS.

 

Enter into or permit to exist any transaction or series of transactions with any
officer, director or Affiliate of such Person other than (a) transactions
between Loan Parties, (b) intercompany transactions expressly permitted by
Section 8.02, Section 8.03, Section 8.04, Section 8.05 or Section 8.06,
(c) normal and reasonable compensation and reimbursement of expenses of officers
and directors and (d) except as otherwise specifically limited in this
Agreement, other transactions which are entered into in the ordinary course of
such Person’s business on terms and conditions substantially as favorable to
such Person as would be obtainable by it in a comparable arms-length transaction
with a Person other than an officer, director or Affiliate.

 

8.09         BURDENSOME AGREEMENTS.

 

Enter into, or permit to exist, any contract, agreement or other instrument that
(a) encumbers or restricts the ability of any such Person to (i) make Restricted
Payments to any Loan Party, (ii) pay any Indebtedness or other obligation owed
to any Loan Party, (iii) make loans or advances to any Loan Party, (iv) transfer
any of its property to any Loan Party, (v) pledge its property pursuant to the
Loan Documents or any renewals, refinancings, exchanges, refundings or extension
thereof or (vi) act as a Loan Party pursuant to the Loan Documents or any
renewals, refinancings, exchanges, refundings or extension thereof, except (in
respect of any of the matters referred to in clauses (i)-(v) above) for (1) this
Agreement and the other Loan Documents, (2) any document or instrument governing
Indebtedness incurred pursuant to Section 8.03(d), provided that any such
restriction contained therein relates only to the asset or assets constructed or
acquired in connection therewith, (3) any Permitted Lien or any document or
instrument governing any Permitted Lien, provided that any such restriction
contained therein relates only to the asset or assets subject to such Permitted
Lien or (4) customary restrictions and conditions contained in any agreement
relating to the sale of any property permitted under Section 8.05 pending the
consummation of such sale, or (b) requires the grant of any security in any
property for any obligation if such property is given as security for the
Obligations.

 

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8.10         USE OF PROCEEDS.

 

Use the proceeds of any Credit Extension, whether directly or indirectly, and
whether immediately, incidentally or ultimately, to purchase or carry margin
stock (within the meaning of Regulation U of the FRB) or to extend credit to
others for the purpose of purchasing or carrying margin stock or to refund
indebtedness originally incurred for such purpose.

 

8.11         CONSOLIDATED LEVERAGE RATIO.

 

Permit the Consolidated Leverage Ratio as of the end of any fiscal quarter of
the Borrower to be greater than 3.75:1.0.

 

8.12         ORGANIZATION DOCUMENTS; FISCAL YEAR.

 

(a)           Amend, modify or change its Organization Documents in a manner
adverse to the Lender.

 

(b)           Change its fiscal year.

 

8.13         OWNERSHIP OF SUBSIDIARIES.

 

Notwithstanding any other provisions of this Agreement to the contrary,
(a) permit any Person (other than the Borrower or any Wholly Owned Subsidiary)
to own any Equity Interests of any Subsidiary, except to qualify directors where
required by applicable law or to satisfy other requirements of applicable law
with respect to the ownership of Equity Interests of Foreign Subsidiaries, or
(b) permit any Subsidiary to issue or have outstanding any shares of preferred
Equity Interests.

 

8.14         SALE LEASEBACKS.

 

Enter into any Sale and Leaseback Transaction.

 

ARTICLE IX

 

EVENTS OF DEFAULT AND REMEDIES

 

9.01         EVENTS OF DEFAULT.

 

Any of the following shall constitute an Event of Default:

 

(a)           Non-Payment.  Any Loan Party fails to pay (i) when and as required
to be paid herein, any amount of principal of any Loan or any L/C Obligation, or
(ii) within three days after the same becomes due, any interest on any Loan or
on any L/C Obligation, or any fee due hereunder, or (iii) within five days after
the same becomes due, any other amount payable hereunder or under any other Loan
Document; or

 

(b)           Specific Covenants.

 

(i)            Any Loan Party fails to perform or observe any term, covenant or
agreement contained in any of Section 7.01 or 7.02 and such failure continues
for five days; or

 

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(ii)           Any Loan Party fails to perform or observe any term, covenant or
agreement contained in any of Section 7.03(a), 7.05(a), 7.10, 7.11 or 7.13 or
Article VIII; or

 

(c)           Other Defaults.  Any Loan Party fails to perform or observe any
other covenant or agreement (not specified in subsection (a) or (b) above)
contained in any Loan Document on its part to be performed or observed and such
failure continues for thirty days; or

 

(d)           Representations and Warranties.  Any representation, warranty,
certification or statement of fact made or deemed made by or on behalf of any
Loan Party herein, in any other Loan Document, or in any document delivered in
connection herewith or therewith shall be incorrect or misleading when made or
deemed made; or

 

(e)           Cross-Default.  (i) The Borrower or any Subsidiary fails to make
any payment when due (whether by scheduled maturity, required prepayment,
acceleration, demand, or otherwise) in respect of any Material Indebtedness;
(ii) the Borrower or any Subsidiary fails to observe or perform any other
agreement or condition relating to any Material Indebtedness or contained in any
instrument or agreement evidencing, securing or relating thereto, or any other
event occurs, the effect of which default or other event is to cause, or to
permit the holder or holders of such Material Indebtedness (or a trustee or
agent on behalf of such holder or holders) to cause, with the giving of notice
if required, such Material Indebtedness to be demanded or to become due or to be
repurchased, prepaid, defeased or redeemed (automatically or otherwise), or an
offer to repurchase, prepay, defease or redeem such Material Indebtedness to be
made, prior to its stated maturity; or (iii) there occurs under any Swap
Contract an Early Termination Date (as defined in such Swap Contract) resulting
from (A) any event of default under such Swap Contract as to which the Borrower
or any Subsidiary is the Defaulting Party (as defined in such Swap Contract) or
(B) any Termination Event (as so defined) under such Swap Contract as to which
the Borrower or any Subsidiary is an Affected Party (as so defined) and, in
either event, the Swap Termination Value owed by the Borrower or such Subsidiary
as a result thereof is greater than the Threshold Amount; or

 

(f)            Insolvency Proceedings, Etc.  The Borrower or any Subsidiary
institutes or consents to the institution of any proceeding under any Debtor
Relief Law, or makes an assignment for the benefit of creditors; or applies for
or consents to the appointment of any receiver, trustee, custodian, conservator,
liquidator, rehabilitator or similar officer for it or for all or any material
part of its property; or any receiver, trustee, custodian, conservator,
liquidator, rehabilitator or similar officer is appointed without the
application or consent of such Person and the appointment continues undischarged
or unstayed for sixty calendar days; or any proceeding under any Debtor Relief
Law relating to any such Person or to all or any material part of its property
is instituted without the consent of such Person and continues undismissed or
unstayed for sixty calendar days, or an order for relief is entered in any such
proceeding; or

 

(g)           Inability to Pay Debts; Attachment.  (i) The Borrower or any
Subsidiary becomes unable or admits in writing its inability or fails generally
to pay its debts as they become due, or (ii) any writ or warrant of attachment
or execution or similar process is issued or levied against all or any material
part of the property of any such Person and is not released, vacated or fully
bonded within thirty days after its issue or levy; or

 

(h)           Judgments.  There is entered against the Borrower or any
Subsidiary (i) one or more final judgments or orders for the payment of money in
an aggregate amount (as to all such judgments or orders) exceeding the Threshold
Amount (to the extent not covered by independent

 

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third-party insurance as to which the insurer has been notified of the claim and
does not dispute coverage), or (ii) any one or more non-monetary final judgments
that have, or could reasonably be expected to have a Material Adverse Effect
and, in either case, (A) enforcement proceedings are commenced by any creditor
upon such judgment or order, or (B) there is a period of ten consecutive days
during which a stay of enforcement of such judgment, by reason of a pending
appeal or otherwise, is not in effect; or

 

(i)            ERISA.  (i) An ERISA Event occurs with respect to a Pension Plan
or Multiemployer Plan which has resulted or could reasonably be expected to
result in liability of the Borrower under Title IV of ERISA to the Pension Plan,
Multiemployer Plan or the PBGC in an aggregate amount in excess of the Threshold
Amount, or (ii) the Borrower or any ERISA Affiliate fails to pay when due, after
the expiration of any applicable grace period, any installment payment with
respect to its withdrawal liability under Section 4201 of ERISA under a
Multiemployer Plan in an aggregate amount in excess of the Threshold Amount; or

 

(j)            Invalidity of Loan Documents.  Any Loan Document, at any time
after its execution and delivery and for any reason other than as expressly
permitted hereunder or thereunder or satisfaction in full of all the
Obligations, ceases to be in full force and effect; or any Loan Party or any
other Person contests in any manner the validity or enforceability of any Loan
Document; or any Loan Party denies that it has any or further liability or
obligation under any Loan Document, or purports to revoke, terminate or rescind
any Loan Document; or

 

(k)           Change of Control.  There occurs any Change of Control; or

 

9.02         REMEDIES UPON EVENT OF DEFAULT.

 

If any Event of Default occurs and is continuing, the Lender may take any or all
of the following actions:

 

(a)           declare the commitment of the Lender to make Loans and L/C Credit
Extensions to be terminated, whereupon such commitments and obligation shall be
terminated;

 

(b)           declare the unpaid principal amount of all outstanding Loans, all
interest accrued and unpaid thereon, and all other amounts owing or payable
hereunder or under any other Loan Document to be immediately due and payable,
without presentment, demand, protest or other notice of any kind, all of which
are hereby expressly waived by the Borrower;

 

(c)           require that the Borrower Cash Collateralize the L/C Obligations
(in an amount equal to the then outstanding principal amount thereof); and

 

(d)           exercise all rights and remedies available to it under the Loan
Documents;

 

provided, however, that upon the occurrence of an actual or deemed entry of an
order for relief with respect to the Borrower under the Bankruptcy Code of the
United States, the obligation of the Lender to make Loans and L/C Credit
Extensions shall automatically terminate, the unpaid principal amount of all
outstanding Loans and all interest and other amounts as aforesaid shall
automatically become due and payable, and the obligation of the Borrower to Cash
Collateralize the L/C Obligations as aforesaid shall automatically become
effective, in each case without further act of the Lender.

 

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9.03         APPLICATION OF FUNDS.

 

After the exercise of remedies provided for in Section 9.02 (or after the Loans
have automatically become immediately due and payable and the L/C Obligations
have automatically been required to be Cash Collateralized as set forth in the
proviso to Section 9.02), any amounts received on account of the Obligations
shall be applied by the Lender in the order determined by the Lender.

 

ARTICLE X

MISCELLANEOUS

 

10.01       AMENDMENTS, ETC.

 

No amendment or waiver of any provision of this Agreement or any other Loan
Document, and no consent to any departure by any Loan Party therefrom, shall be
effective unless in writing signed by the Lender and the applicable Loan Party,
and each such waiver or consent shall be effective only in the specific instance
and for the specific purpose for which given.

 

10.02       NOTICES; EFFECTIVENESS; ELECTRONIC COMMUNICATIONS.

 

(a)           Notices Generally.  Except in the case of notices and other
communications expressly permitted to be given by telephone (and except as
provided in subsection (b) below), all notices and other communications provided
for herein shall be in writing and shall be delivered by hand or overnight
courier service, mailed by certified or registered mail or sent by telecopier to
the address or telecopier number specified for the applicable Person on Schedule
10.02, and all notices and other communications expressly permitted hereunder to
be given by telephone shall be made to the telephone number specified for the
applicable Person on Schedule 10.02.  Notices and other communications sent by
hand or overnight courier service, or mailed by certified or registered mail,
shall be deemed to have been given when received; notices and other
communications sent by telecopier shall be deemed to have been given when sent
(except that, if not given during normal business hours for the recipient, shall
be deemed to have been given at the opening of business on the next business day
for the recipient).  Notices and other communications delivered through
electronic communications to the extent provided in subsection (b) below, shall
be effective as provided in such subsection (b).

 

(b)           Electronic Communications.  Notices and other communications to
the Lender hereunder may be delivered or furnished by electronic communication
(including e-mail and Internet or intranet websites) pursuant to procedures
approved by the Lender.  Unless the Lender otherwise prescribes, (i) notices and
other communications sent to an e-mail address shall be deemed received upon the
sender’s receipt of an acknowledgement from the intended recipient (such as by
the “return receipt requested” function, as available, return e-mail or other
written acknowledgement), provided that if such notice or other communication is
not sent during the normal business hours of the recipient, such notice or
communication shall be deemed to have been sent at the opening of business on
the next business day for the recipient, and (ii) notices or communications
posted to an Internet or intranet website shall be deemed received upon the
deemed receipt by the intended recipient at its e-mail address as described in
the foregoing clause (i) of notification that such notice or communication is
available and identifying the website address therefor.

 

(c)           Change of Address, Etc.  Each of the Borrower and the Lender may
change its address, telecopier or telephone number for notices and other
communications hereunder by notice to the other parties hereto.

 

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(d)           Reliance by Lender.  The Lender shall be entitled to rely and act
upon any notices (including telephonic Loan Notices) purportedly given by or on
behalf of any Loan Party even if (i) such notices were not made in a manner
specified herein, were incomplete or were not preceded or followed by any other
form of notice specified herein, or (ii) the terms thereof, as understood by the
recipient, varied from any confirmation thereof.  The Loan Parties shall
indemnify the Lender and its Related Parties from all losses, costs, expenses
and liabilities resulting from the reliance by such Person on each notice
purportedly given by or on behalf of a Loan Party.  All telephonic notices to
and other telephonic communications with the Lender may be recorded by the
Lender, and each of the parties hereto hereby consents to such recording.

 

10.03       NO WAIVER; CUMULATIVE REMEDIES; ENFORCEMENT.

 

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

 

10.04       EXPENSES; INDEMNITY; AND DAMAGE WAIVER.

 

(a)           Costs and Expenses.  The Loan Parties shall pay (i) all reasonable
out-of-pocket expenses incurred by the Lender and its Affiliates (including the
reasonable fees, charges and disbursements of counsel for the Lender) in
connection with the preparation, negotiation, execution, delivery and
administration of this Agreement and the other Loan Documents or any amendments,
modifications or waivers of the provisions hereof or thereof (whether or not the
transactions contemplated hereby or thereby shall be consummated), (ii) all
reasonable out-of-pocket expenses incurred by the Lender in connection with the
issuance, amendment, renewal or extension of any Letter of Credit or any demand
for payment thereunder and (iii) all out-of-pocket expenses incurred by the
Lender (including the fees, charges and disbursements of any counsel for the
Lender) in connection with the enforcement or protection of its rights (A) in
connection with this Agreement and the other Loan Documents, including its
rights under this Section, or (B) in connection with the Loans made or Letters
of Credit issued hereunder, including all such out-of-pocket expenses incurred
during any workout, restructuring or negotiations in respect of such Loans or
Letters of Credit.

 

(b)           Indemnification by the Loan Parties.  The Loan Parties shall
indemnify the Lender and its Related Parties (each such Person being called an
“Indemnitee”) against, and hold each Indemnitee harmless from, any and all
losses, claims, damages, liabilities and related expenses (including the fees,
charges and disbursements of any counsel for any Indemnitee), and shall
indemnify and hold harmless each Indemnitee from all fees and time charges and
disbursements for attorneys who may be employees of any Indemnitee, incurred by
any Indemnitee or asserted against any Indemnitee by any third party or by any
Loan Party arising out of, in connection with, or as a result of (i) the
execution or delivery of this Agreement, any other Loan Document or any
agreement or instrument contemplated hereby or thereby, the performance by the
parties hereto of their respective obligations hereunder or thereunder or the
consummation of the transactions contemplated hereby or thereby, (ii) any Loan
or Letter of Credit or the use or proposed use of the proceeds therefrom
(including any refusal by the Lender to honor a demand for payment under a
Letter of Credit if the documents presented in connection with such demand do
not strictly comply with the terms of such Letter of Credit), (iii) any actual
or alleged presence or release of Hazardous Materials on or from any property
owned or operated by a Loan Party or any of its Subsidiaries, or any
Environmental Liability related in any way to a Loan Party or any of its
Subsidiaries, or (iv) any actual or prospective claim, litigation, investigation
or proceeding relating to any of the

 

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foregoing, whether based on contract, tort or any other theory, whether brought
by a third party or by any Loan Party, and regardless of whether any Indemnitee
is a party thereto; provided that such indemnity shall not, as to any
Indemnitee, be available to the extent that such losses, claims, damages,
liabilities or related expenses (x) are determined by a court of competent
jurisdiction by final and nonappealable judgment to have resulted from the gross
negligence or willful misconduct of such Indemnitee or (y) result from a claim
brought by the any Loan Party against an Indemnitee for breach in bad faith of
such Indemnitee’s obligations hereunder or under any other Loan Document, if
such Loan Party has obtained a final and nonappealable judgment in its favor on
such claim as determined by a court of competent jurisdiction.

 

(c)           Waiver of Consequential Damages, Etc.  To the fullest extent
permitted by applicable law, no Loan Party shall assert, and each Loan Party
hereby waives, any claim against any Indemnitee, on any theory of liability, for
special, indirect, consequential or punitive damages (as opposed to direct or
actual damages) arising out of, in connection with, or as a result of, this
Agreement, any other Loan Document or any agreement or instrument contemplated
hereby, the transactions contemplated hereby or thereby, any Loan or Letter of
Credit or the use of the proceeds thereof.  No Indemnitee shall be liable for
any damages arising from the use by unintended recipients of any information or
other materials distributed to such unintended recipients by such Indemnitee
through telecommunications, electronic or other information transmission systems
in connection with this Agreement or the other Loan Documents or the
transactions contemplated hereby or thereby other than for direct or actual
damages resulting from the gross negligence or willful misconduct of such
Indemnitee as determined by a final and nonappealable judgment of a court of
competent jurisdiction.

 

(d)           Payments.  All amounts due under this Section shall be payable not
later than ten Business Days after demand therefor.

 

(e)           Survival.  The agreements in this Section shall survive the
termination of the Revolving Commitment and the repayment, satisfaction or
discharge of all the other Obligations.

 

10.05       PAYMENTS SET ASIDE.

 

To the extent that any payment by or on behalf of any Loan Party is made to the
Lender, or the Lender exercises its right of setoff, and such payment or the
proceeds of such setoff or any part thereof is subsequently invalidated,
declared to be fraudulent or preferential, set aside or required (including
pursuant to any settlement entered into by the Lender in its discretion) to be
repaid to a trustee, receiver or any other party, in connection with any
proceeding under any Debtor Relief Law or otherwise, then to the extent of such
recovery, the obligation or part thereof originally intended to be satisfied
shall be revived and continued in full force and effect as if such payment had
not been made or such setoff had not occurred

 

10.06       SUCCESSORS AND ASSIGNS.

 

(a)           The provisions of this Agreement and the other Loan Documents
shall be binding upon and inure to the benefit of the parties hereto and thereto
and their respective successors and assigns permitted hereby, except that the
Borrower may not assign or otherwise transfer any of its rights or obligations
hereunder or thereunder without the prior written consent of the Lender.

 

(b)           The Lender may at any time assign, or sell participations in, all
or a portion of its rights and obligations under this Agreement and the other
Loan Documents to any Person without the consent of the Borrower.  The Borrower
agrees that each Person acquiring a participation shall (x) be entitled to the
benefits of Sections 3.01 to the same extent as if it were the Lender and had
acquired its interest by

 

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assignment and (y) to the extent permitted by Law, each Participant also shall
be entitled to the benefits of Section 10.08 as though it were the Lender

 

(c)           Certain Pledges.  The Lender may at any time pledge or assign a
security interest in all or any portion of its rights under this Agreement
(including under the Note) to secure obligations of the Lender, including any
pledge or assignment to secure obligations to a Federal Reserve Bank; provided
that no such pledge or assignment shall release the Lender from any of its
obligations hereunder or substitute any such pledgee or assignee for the Lender
as a party hereto.

 

10.07       SET-OFF.

 

If an Event of Default shall have occurred and be continuing, the Lender and
each of its Affiliates is hereby authorized at any time and from time to time,
to the fullest extent permitted by applicable law, to set off and apply any and
all deposits (general or special, time or demand, provisional or final, in
whatever currency) at any time held and other obligations (in whatever currency)
at any time owing by the Lender or any such Affiliate to or for the credit or
the account of any Loan Party against any and all of the obligations of such
Loan Party now or hereafter existing under this Agreement or any other Loan
Document to the Lender, irrespective of whether or not the Lender shall have
made any demand under this Agreement or any other Loan Document and although
such obligations of such Loan Party may be contingent or unmatured or are owed
to a branch or office of the Lender different from the branch or office holding
such deposit or obligated on such indebtedness.  The rights of the Lender and
its Affiliates under this Section are in addition to other rights and remedies
(including other rights of setoff) that the Lender or its Affiliates may have. 
The Lender agrees to notify the Borrower promptly after any such setoff and
application, provided that the failure to give such notice shall not affect the
validity of such setoff and application.

 

10.08       INTEREST RATE LIMITATION.

 

Notwithstanding anything to the contrary contained in any Loan Document, the
interest paid or agreed to be paid under the Loan Documents shall not exceed the
maximum rate of non-usurious interest permitted by applicable Law (the “Maximum
Rate”).  If the Lender shall receive interest in an amount that exceeds the
Maximum Rate, the excess interest shall be applied to the principal of the Loans
or, if it exceeds such unpaid principal, refunded to the Borrower.  In
determining whether the interest contracted for, charged, or received by the
Lender exceeds the Maximum Rate, such Person may, to the extent permitted by
applicable Law, (a) characterize any payment that is not principal as an
expense, fee, or premium rather than interest, (b) exclude voluntary prepayments
and the effects thereof, and (c) amortize, prorate, allocate, and spread in
equal or unequal parts the total amount of interest throughout the contemplated
term of the Obligations hereunder.

 

10.09       COUNTERPARTS; INTEGRATION; EFFECTIVENESS.

 

This Agreement may be executed in counterparts (and by different parties hereto
in different counterparts), each of which shall constitute an original, but all
of which when taken together shall constitute a single contract.  This Agreement
and the other Loan Documents constitute the entire contract among the parties
relating to the subject matter hereof and supersede any and all previous
agreements and understandings, oral or written, relating to the subject matter
hereof.  Except as provided in Section 5.01, this Agreement shall become
effective when it shall have been executed by the Lender and when the Lender
shall have received counterparts hereof that, when taken together, bear the
signatures of each of the other parties hereto.  Delivery of an executed
counterpart of a signature page of this Agreement by telecopy or other
electronic imaging means shall be effective as delivery of a manually executed
counterpart of this Agreement.

 

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10.10       SURVIVAL OF REPRESENTATIONS AND WARRANTIES.

 

All representations and warranties made hereunder and in any other Loan Document
or other document delivered pursuant hereto or thereto or in connection herewith
or therewith shall survive the execution and delivery hereof and thereof.  Such
representations and warranties have been or will be relied upon by the Lender,
regardless of any investigation made by the Lender or on its behalf and
notwithstanding that the Lender may have had notice or knowledge of any Default
at the time of any Credit Extension, and shall continue in full force and effect
as long as any Loan or any other Obligation hereunder shall remain unpaid or
unsatisfied or any Letter of Credit shall remain outstanding.

 

10.11       SEVERABILITY.

 

If any provision of this Agreement or the other Loan Documents is held to be
illegal, invalid or unenforceable, (a) the legality, validity and enforceability
of the remaining provisions of this Agreement and the other Loan Documents shall
not be affected or impaired thereby and (b) the parties shall endeavor in good
faith negotiations to replace the illegal, invalid or unenforceable provisions
with valid provisions the economic effect of which comes as close as possible to
that of the illegal, invalid or unenforceable provisions.  The invalidity of a
provision in a particular jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.

 

10.12       GOVERNING LAW; JURISDICTION; ETC.

 

(a)           GOVERNING LAW.  THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED
IN ACCORDANCE WITH, THE LAW OF THE STATE OF GEORGIA.

 

(b)           SUBMISSION TO JURISDICTION.  EACH LOAN PARTY IRREVOCABLY AND
UNCONDITIONALLY SUBMITS, FOR ITSELF AND ITS PROPERTY, TO THE NONEXCLUSIVE
JURISDICTION OF THE COURTS OF THE STATE OF GEORGIA SITTING IN FULTON COUNTY AND
OF THE UNITED STATES DISTRICT COURT OF THE NORTHERN DISTRICT OF GEORGIA (ATLANTA
DIVISION), AND ANY APPELLATE COURT FROM ANY THEREOF, IN ANY ACTION OR PROCEEDING
ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT, OR FOR
RECOGNITION OR ENFORCEMENT OF ANY JUDGMENT, AND EACH OF THE PARTIES HERETO
IRREVOCABLY AND UNCONDITIONALLY AGREES THAT ALL CLAIMS IN RESPECT OF ANY SUCH
ACTION OR PROCEEDING MAY BE HEARD AND DETERMINED IN SUCH GEORGIA STATE COURT OR,
TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, IN SUCH FEDERAL COURT.  EACH
OF THE PARTIES HERETO AGREES THAT A FINAL JUDGMENT IN ANY SUCH ACTION OR
PROCEEDING SHALL BE CONCLUSIVE AND MAY BE ENFORCED IN OTHER JURISDICTIONS BY
SUIT ON THE JUDGMENT OR IN ANY OTHER MANNER PROVIDED BY LAW.  NOTHING IN THIS
AGREEMENT OR IN ANY OTHER LOAN DOCUMENT SHALL AFFECT ANY RIGHT THAT THE LENDER
MAY OTHERWISE HAVE TO BRING ANY ACTION OR PROCEEDING RELATING TO THIS AGREEMENT
OR ANY OTHER LOAN DOCUMENT AGAINST ANY LOAN PARTY OR ITS PROPERTIES IN THE
COURTS OF ANY JURISDICTION.

 

(c)           WAIVER OF VENUE.  EACH LOAN PARTY IRREVOCABLY AND UNCONDITIONALLY
WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY OBJECTION THAT IT
MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY ACTION OR PROCEEDING
ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT IN ANY
COURT REFERRED TO IN PARAGRAPH (B) OF THIS SECTION.  EACH OF THE PARTIES HERETO
HEREBY

 

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IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, THE
DEFENSE OF AN INCONVENIENT FORUM TO THE MAINTENANCE OF SUCH ACTION OR PROCEEDING
IN ANY SUCH COURT.

 

(d)           SERVICE OF PROCESS.  EACH PARTY HERETO IRREVOCABLY CONSENTS TO
SERVICE OF PROCESS IN THE MANNER PROVIDED FOR NOTICES IN SECTION 10.02.  NOTHING
IN THIS AGREEMENT WILL AFFECT THE RIGHT OF ANY PARTY HERETO TO SERVE PROCESS IN
ANY OTHER MANNER PERMITTED BY APPLICABLE LAW.

 

10.13       WAIVER OF RIGHT TO TRIAL BY JURY.

 

EACH PARTY HERETO HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY
APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING
DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER
LOAN DOCUMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY (WHETHER BASED
ON CONTRACT, TORT OR ANY OTHER THEORY).  EACH PARTY HERETO (A) CERTIFIES THAT NO
REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PERSON HAS REPRESENTED, EXPRESSLY
OR OTHERWISE, THAT SUCH OTHER PERSON WOULD NOT, IN THE EVENT OF LITIGATION, SEEK
TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER
PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT AND THE OTHER LOAN
DOCUMENTS BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS
SECTION.

 

10.14       NO ADVISORY OR FIDUCIARY RESPONSIBILITY.

 

In connection with all aspects of each transaction contemplated hereby
(including in connection with any amendment, waiver or other modification hereof
or of any other Loan Document), each of the Loan Parties acknowledges and
agrees, and acknowledges its Affiliates’ understanding, that: (i) (A) the
arranging and other services regarding this Agreement provided by the Lender are
arm’s-length commercial transactions between the Loan Parties and their
respective Affiliates, on the one hand, and the Lender, on the other hand,
(B) each of the Loan Parties has consulted its own legal, accounting, regulatory
and tax advisors to the extent it has deemed appropriate, and (C) each of the
Loan Parties is capable of evaluating, and understands and accepts, the terms,
risks and conditions of the transactions contemplated hereby and by the other
Loan Documents; (ii) (A) the Lender is and has been acting solely as a principal
and, except as expressly agreed in writing by the relevant parties, has not
been, is not, and will not be acting as an advisor, agent or fiduciary for the
Loan Parties or any of their respective Affiliates, or any other Person and
(B) the Lender has no obligation to the Loan Parties or any of their respective
Affiliates with respect to the transactions contemplated hereby except those
obligations expressly set forth herein and in the other Loan Documents; and
(iii) the Lender and its Affiliates may be engaged in a broad range of
transactions that involve interests that differ from those of the Loan Parties
and their respective Affiliates, and Lender has no obligation to disclose any of
such interests to the Loan Parties and their respective Affiliates.  To the
fullest extent permitted by Law, each of the Loan Parties hereby waives and
releases any claims that it may have against the Lender with respect to any
breach or alleged breach of agency or fiduciary duty in connection with any
aspect of any transaction contemplated hereby.

 

10.15       ELECTRONIC EXECUTION OF ASSIGNMENTS AND CERTAIN OTHER DOCUMENTS.

 

The words “execution,” “signed,” “signature,” and words of like import in any
Assignment and Assumption or in any amendment or other modification hereof
(including waivers and consents) shall be

 

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deemed to include electronic signatures or the keeping of records in electronic
form, each of which shall be of the same legal effect, validity or
enforceability as a manually executed signature or the use of a paper-based
recordkeeping system, as the case may be, to the extent and as provided for in
any applicable law, including the Federal Electronic Signatures in Global and
National Commerce Act, the New York State Electronic Signatures and Records Act,
or any other similar state laws based on the Uniform Electronic Transactions
Act.

 

10.16       USA PATRIOT ACT.

 

The Lender hereby notifies the Borrower that pursuant to the requirements of the
USA PATRIOT Act (Title III of Pub.
L. 107-56 (signed into law October 26, 2001)) (the “Act”), it is required to
obtain, verify and record information that identifies the Borrower, which
information includes the name and address of the Borrower and other information
that will allow the Lender to identify the Borrower in accordance with the Act. 
The Borrower shall, promptly following a request by the Lender provide all
documentation and other information that the Lender requests in order to comply
with its ongoing obligations under applicable “know your customer” and
anti-money laundering rules and regulations, including the Act.

 

[SIGNATURE PAGES FOLLOW]

 

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

 

BORROWER:

CITI TRENDS, INC., a Delaware corporation

 

 

 

 

By:

 

/s/ Bruce Smith

 

Name:

Bruce Smith

 

Title:

Senior Vice President and Chief Financial Officer

 

 

 

LENDER:

BANK OF AMERICA, N.A.

 

 

 

 

By:

 

/s/ Stephen Price

 

Name:

Stephen Price

 

Title:

Senior Vice President

 

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