Exhibit 10.1

 

$36,000,000 US Dollar Revolving Loan
€16,000,000 Euro Revolving Loan
C$1,500,000 Canadian Dollar Revolving Loan

 

AMENDED AND RESTATED CREDIT AGREEMENT

 

dated as of

 

December 21, 2011

 

among

 

DYNAMIC MATERIALS CORPORATION,

 

The US Borrowers Party Hereto,

 

The Euro Borrowers Party Hereto,

 

The Canadian Borrowers Party Hereto,

 

The Guarantors Party Hereto,

 

The Lenders Party Hereto,

 

JPMORGAN CHASE BANK, N.A.,
as US Administrative Agent,

 

J.P. MORGAN EUROPE LIMITED,
as Euro Administrative Agent,

 

JPMORGAN CHASE BANK N.A., TORONTO BRANCH,
as Canadian Administrative Agent,

 

KEYBANK NATIONAL ASSOCIATION,
as Syndication Agent

 

and

 

WELLS FARGO BANK, NATIONAL ASSOCIATION,
as Documentation Agent

 

* * *

 

JPMORGAN CHASE BANK, N.A.,
as Lead Arranger and Sole Bookrunner

 

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TABLE OF CONTENTS

 

 

Page

 

 

ARTICLE I Definitions

1

 

 

Section 1.01

Defined Terms

1

Section 1.02

Classification of Loans and Borrowings

26

Section 1.03

Terms Generally

26

Section 1.04

Accounting Terms; GAAP

26

Section 1.05

Conversions

27

 

 

 

ARTICLE II The Credits

27

 

 

Section 2.01

Commitments

27

Section 2.02

Loans and Borrowings

27

Section 2.03

Requests for Borrowings

28

Section 2.04

Swingline Loans

29

Section 2.05

Letters of Credit

31

Section 2.06

Funding of Borrowings

36

Section 2.07

Interest Elections

37

Section 2.08

Termination and Reduction of Commitments

38

Section 2.09

Repayment of Loans; Evidence of Debt

39

Section 2.10

Prepayment of Loans

40

Section 2.11

Fees

41

Section 2.12

Interest

44

Section 2.13

Alternate Rate of Interest

45

Section 2.14

Increased Costs

45

Section 2.15

Break Funding Payments

47

Section 2.16

Taxes

47

Section 2.17

Payments Generally; Pro Rata Treatment; Sharing of Set-offs; Sharing of
Collateral Proceeds and Payments After Default

51

Section 2.18

Mitigation Obligations; Replacement of Lenders

53

Section 2.19

Increase in the Commitments

54

Section 2.20

Defaulting Lenders

56

 

 

 

ARTICLE III Representations and Warranties

58

 

 

Section 3.01

Organization

58

Section 3.02

Authority Relative to this Agreement

59

Section 3.03

No Violation

59

Section 3.04

Financial Statements

60

Section 3.05

No Undisclosed Liabilities

60

Section 3.06

Litigation

60

Section 3.07

Compliance with Law

60

Section 3.08

Material Contracts

61

Section 3.09

Properties

61

Section 3.10

Intellectual Property

61

 

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Section 3.11

Taxes

62

Section 3.12

Environmental Compliance

62

Section 3.13

Labor Matters

63

Section 3.14

Investment and Holding Company Status

63

Section 3.15

Insurance

63

Section 3.16

Solvency

63

Section 3.17

ERISA

63

Section 3.18

Disclosure

63

Section 3.19

Margin Stock

64

 

 

 

ARTICLE IV Conditions

64

 

 

Section 4.01

Effective Date

64

Section 4.02

Each Credit Event

66

 

 

 

ARTICLE V Affirmative Covenants

67

 

 

Section 5.01

Financial Statements and Other Information

67

Section 5.02

Notices of Material Events

68

Section 5.03

Existence; Conduct of Business

69

Section 5.04

Payment of Obligations

69

Section 5.05

Maintenance of Properties; Insurance

69

Section 5.06

Books and Records; Inspection Rights

69

Section 5.07

Compliance with Laws

70

Section 5.08

Use of Proceeds and Letters of Credit

70

Section 5.09

Additional Guarantees and Security Documents

70

Section 5.10

Compliance with ERISA

71

Section 5.11

Compliance with Environmental Laws; Environmental Reports

71

Section 5.12

Maintain Business

72

Section 5.13

Further Assurances and New Intellectual Property

72

 

 

 

ARTICLE VI Negative Covenants

72

 

 

Section 6.01

Indebtedness

73

Section 6.02

Liens

74

Section 6.03

Fundamental Changes

76

Section 6.04

Asset Sales

77

Section 6.05

Investments

78

Section 6.06

Swap Agreements

79

Section 6.07

Restricted Payments

79

Section 6.08

Transactions with Affiliates

80

Section 6.09

Restrictive Agreements

80

Section 6.10

Business Acquisitions

81

Section 6.11

Constituent Documents

82

Section 6.12

Sales and Leasebacks

82

Section 6.13

Changes in Fiscal Year

82

Section 6.14

Fixed Charge Coverage Ratio

82

Section 6.15

Leverage Ratio

82

 

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ARTICLE VII Events of Default and Remedies

83

 

 

Section 7.01

Events of Default

83

Section 7.02

Cash Collateral

85

 

 

 

ARTICLE VIII The Agents

85

 

 

ARTICLE IX Guarantees

88

 

 

Section 9.01

The Guarantees

88

Section 9.02

Guarantee Unconditional

89

Section 9.03

Discharge Only Upon Payment in Full; Reinstatement In Certain Circumstances

90

Section 9.04

Waiver by Each Guarantor

90

Section 9.05

Subrogation

90

Section 9.06

Stay of Acceleration

91

Section 9.07

Limit of Liability

91

Section 9.08

Release upon Sale

91

Section 9.09

Benefit to Guarantor

91

Section 9.10

Jurisdiction Specific Provisions

92

 

 

 

ARTICLE X Miscellaneous

92

 

 

Section 10.01

Notices

92

Section 10.02

Waivers; Amendments

96

Section 10.03

Expenses; Indemnity; Damage Waiver

97

Section 10.04

Successors and Assigns

98

Section 10.05

Survival

101

Section 10.06

Counterparts; Integration; Effectiveness

102

Section 10.07

Severability

102

Section 10.08

Right of Setoff

102

Section 10.09

Governing Law; Jurisdiction; Consent to Service of Process

102

Section 10.10

WAIVER OF JURY TRIAL

103

Section 10.11

Headings

104

Section 10.12

Confidentiality

104

Section 10.13

Interest Rate Limitation

105

Section 10.14

USA Patriot Act

105

Section 10.15

Amendment and Restatement

106

Section 10.16

Exiting Lenders

106

 

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SCHEDULES:

 

 

 

Schedule 1.01

Security Agreements

Schedule 2.01

Commitments

Schedule 3.01

Organization

Schedule 3.03

No Violations

Schedule 3.05

No Undisclosed Liabilities

Schedule 3.06

Litigation

Schedule 3.07

Compliance with Law

Schedule 3.08

Material Contracts

Schedule 3.09

Properties

Schedule 3.10

Intellectual Property

Schedule 3.12

Environmental Compliance

Schedule 3.15

Insurance

Schedule 6.01

Existing Indebtedness

Schedule 6.02

Existing Liens

Schedule 6.05

Existing Investments

Schedule 6.08(j)

Permitted Affiliate Agreements

Schedule 6.09

Restrictive Agreements

Schedule 9.10

Jurisdiction Specific Provisions

 

 

EXHIBITS:

 

 

 

Exhibit 1.1A

Form of Assignment and Assumption

Exhibit 1.1B(i)

Form of Joinder Agreement (Domestic)

Exhibit 1.1B(ii)

Form of Joinder Agreement (Foreign)

Exhibit 1.1C

Mandatory Cost Calculation

Exhibit 1.1D

Form of Commitment Increase Agreement

Exhibit 1.1E

Form of New Lender Agreement

Exhibit 2.03

Form of Borrowing Request

Exhibit 2.07

Form of Interest Election Request

Exhibit 5.01(c)

Form of Compliance Certificate

 

iv

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AMENDED AND RESTATED CREDIT AGREEMENT dated as of December 21, 2011 (this
“Agreement”), among Dynamic Materials Corporation, a Delaware corporation (the
“Parent”), the US Borrowers party hereto, the Euro Borrowers party hereto, the
Canadian Borrowers party hereto, the Guarantors party hereto, the Lenders party
hereto, JPMorgan Chase Bank, N.A., as US Administrative Agent, J.P. Morgan
Europe Limited, as Euro Administrative Agent and JPMorgan Chase Bank, N.A.,
Toronto Branch, as Canadian Administrative Agent, KeyBank National Association,
as Syndication Agent and Wells Fargo Bank, National Association, as
Documentation Agent.

 

PRELIMINARY STATEMENT:

 

WHEREAS, the Parent is a party to that certain Credit Agreement dated
November 16, 2007 (the “Prior Agreement”) among the Parent, Dynamic Materials
Luxembourg 2 S.à r.l., the guarantors party thereto, the lenders party thereto,
JPMorgan Chase Bank, N.A., as administrative agent and J.P. Morgan Europe
Limited, as Euro administrative agent;

 

WHEREAS, the Borrowers, the Administrative Agent, the Euro Administrative Agent
and the Lenders mutually desire to amend and restate the Prior Agreement in its
entirety;

 

NOW, THEREFORE, in consideration of the foregoing and the mutual covenants set
forth herein, the Borrowers, the Guarantors, the US Administrative Agent, the
Euro Administrative Agent, the Canadian Administrative Agent and the Lenders
agree as follows:

 

ARTICLE I

 

Definitions

 

Section 1.01           Defined Terms.  As used in this Agreement, the following
terms have the meanings specified below:

 

“ABR”, when used in reference to any US Loan or US Borrowing, refers to whether
such Loan, or the Loans comprising such Borrowing, are bearing interest at a
rate determined by reference to the Alternate Base Rate.

 

“Adjusted LIBO Rate” means, with respect to any Eurodollar Borrowing for any
Interest Period, an interest rate per annum (rounded upwards, if necessary, to
the next 1/100 of 1%) equal to (a) the LIBO Rate for such Interest Period
multiplied by (b) the Statutory Reserve Rate.

 

“Administrative Questionnaire” means an Administrative Questionnaire in a form
supplied by an Agent.

 

“Affiliate” means, with respect to a specified 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.

 

“Agents” means the US Administrative Agent, the Euro Administrative Agent and
the Canadian Administrative Agent.

 

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“Agreement” has the meaning set forth in the introductory paragraph hereof.

 

“Alternate Base Rate” means, for any day, a rate per annum equal to the greatest
of (a) the Prime Rate in effect on such day, (b) the Federal Funds Effective
Rate in effect on such day plus ½ of 1% and (c) the Adjusted LIBO Rate for a one
month Interest Period on such day (or if such day is not a Business Day, the
immediately preceding Business Day) plus 1%.  Any change in the Alternate Base
Rate due to a change in the Prime Rate, the Federal Funds Effective Rate or the
Adjusted LIBO Rate shall be effective from and including the effective date of
such change in the Prime Rate, the Federal Funds Effective Rate or the Adjusted
LIBO Rate, respectively.

 

“Applicable Agent” means (a) with respect to a Loan or Borrowing denominated in
Dollars or a US Letter of Credit and with respect to any payment hereunder that
does not relate to a particular Loan or Borrowing, the US Administrative Agent,
(b) with respect to a Loan or Borrowing denominated in Euros or a Euro Letter of
Credit, the Euro Administrative Agent and (c) with respect to a Loan or
Borrowing denominated in Canadian Dollars or a Canadian Letter of Credit, the
Canadian Administrative Agent.

 

“Applicable Issuing Lender” means (a) with respect to a US Letter of Credit, the
US Issuing Lender, (b) with respect to a Euro Letter of Credit, the Euro Issuing
Lender and (c) with respect to a Canadian Letter of Credit, the Canadian Issuing
Lender.

 

“Applicable Margin” means, on any day, the applicable per annum percentage set
forth at the appropriate intersection in the table shown below, based on the
Leverage Ratio for the most recently ended trailing four-quarter period with
respect to which the Parent is required to have delivered the financial
statements pursuant to Section 5.01(a) or Section 5.01(b), as applicable (as
such Leverage Ratio is reflected in the Compliance Certificate delivered under
Section 5.01(c) in connection with such financial statements):

 

Level

 

Leverage Ratio

 

Applicable Margin
for Eurodollar,
Eurocurrency and
CDOR Loans

 

Applicable Margin
for ABR Loans

 

Applicable Margin
for Canadian Prime
Rate Loans

 

I

 

1.00 > X

 

1.25

%

0.00

%

1.50

%

II

 

1.50 >X > 1.00

 

1.50

%

0.00

%

1.50

%

III

 

X > 1.50

 

1.75

%

0.25

%

1.75

%

 

Each change in the Applicable Margin shall take effect on each date on which
such financial statements and Compliance Certificate are required to be
delivered pursuant to Section 5.01(a) or Section 5.01(b), as applicable, and
Section 5.01(c), commencing with the date on which such financials statements
and Compliance Certificate are required to be delivered for the fiscal year
ending December 31, 2011.  Notwithstanding the foregoing, for the period from
the Effective Date through the date the financial statements and Compliance
Certificate are required to be delivered pursuant to Section 5.01(a) and
Section 5.01(c) for the fiscal year ending December 31, 2011, the Applicable
Margin shall be determined at Level I.  In the event that any financial
statement delivered pursuant to Section 5.01(a) or Section 5.01(b), as
applicable, is shown to be

 

2

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inaccurate when delivered (regardless of whether this Agreement or the
Commitments are in effect when such inaccuracy is discovered), and such
inaccuracy, if corrected, would have led to the application of a higher
Applicable Margin for any period (an “Applicable Period”) than the Applicable
Margin applied for such Applicable Period, and only in such case, then the
Parent shall immediately (i) deliver to the US Administrative Agent corrected
financial statements for such Applicable Period, (ii) determine the Applicable
Margin for such Applicable Period based upon the corrected financial statements,
and (iii) immediately pay to the US Administrative Agent the accrued additional
interest owing as a result of such increased Applicable Margin for such
Applicable Period, which payment shall be promptly applied by the US
Administrative Agent in accordance with Section 2.17(e).  This provision is in
addition to rights of the Agents and Lenders with respect to Section 2.12(g) and
their other respective rights under this Agreement.  If the Parent fails to
deliver the financial statements and corresponding Compliance Certificate to the
US Administrative Agent at the time required pursuant to Section 5.01, then
effective as of the date such financial statements and corresponding Compliance
Certificate were required to be delivered pursuant to Section 5.01, the
Applicable Margin shall be determined at Level III and shall remain at such
level until the date such financial statements and corresponding Compliance
Certificate are so delivered by the Parent.

 

“Applicable Percentage” means (a) with respect to any US Lender, the percentage
of the total US Commitments represented by such Lender’s US Commitment, (b) with
respect to any Euro Lender, the percentage of the total Euro Commitments
represented by such Lender’s Euro Commitment and (c) with respect to any
Canadian Lender, the percentage of total Canadian Commitments represented by
such Lender’s Canadian Commitment; provided that in the case of Section 2.20
when a Defaulting Lender shall exist, “Applicable Percentage” shall mean the
percentage of total Commitments of any Class (disregarding any Defaulting
Lender’s Commitment of such Class) represented by such Lender’s Commitment of
such Class.  If the Commitments have terminated or expired pursuant to this
Agreement, the Applicable Percentages shall be determined based upon the
Commitments most recently in effect, giving effect to any assignments pursuant
to this Agreement and any Lender’s status as a Defaulting Lender at the time of
determination.

 

“Asset Sale” means a Disposition by any Borrower or any of its respective
Subsidiaries to any Person of (a) substantially all of the assets, or any
material division or line of business, of such Borrower or any such Subsidiary,
or (b) any other assets of such Borrower or any such Subsidiary, including,
without limitation, any accounts receivable, but excluding in each case of
clause (a) and (b) above the Dispositions permitted in Section 6.04.

 

“Assignment and Assumption” means an assignment and assumption entered into by a
Lender and an assignee (with the consent of any party whose consent is required
by Section 10.04), and accepted by the US Administrative Agent, in the form of
Exhibit 1.1A or any other form approved by US Administrative Agent and the
Parent.

 

“Availability Period” means the period from and including the Effective Date to
but excluding the earlier of the Termination Date and the date of termination of
the Commitments.

 

“Bank Products” means each and any of the following bank services provided to
any Obligor by a Lender or any of its Affiliates: (a) commercial credit cards,
(b) commercial

 

3

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checking accounts, (c) stored value cards and (d) treasury management services
(including, without limitation, controlled disbursements, automated
clearinghouse transactions, return items, overdrafts and interstate depository
network services).

 

“Bankruptcy Event” means, with respect to any Person, such Person becomes the
subject of a bankruptcy or insolvency proceeding, or has had a receiver,
conservator, trustee, administrator, custodian, assignee for the benefit of
creditors or similar Person charged with the reorganization or liquidation of
its business appointed for it, or, in the good faith determination of the US
Administrative Agent, has taken any action in furtherance of, or indicating its
consent to, approval of, or acquiescence in, any such proceeding or appointment,
provided that a Bankruptcy Event shall not result solely by virtue of any
ownership interest, or the acquisition of any ownership interest, in such Person
by a Governmental Authority or instrumentality thereof, provided, further, that
such ownership interest does not result in or provide such Person with immunity
from the jurisdiction of courts within the United States or from the enforcement
of judgments or writs of attachment on its assets or permit such Person (or such
Governmental Authority or instrumentality) to reject, repudiate, disavow or
disaffirm any contracts or agreements made by such Person.

 

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

 

“Borrowers” means, collectively, the US Borrowers, the Euro Borrowers and the
Canadian Borrowers.

 

“Borrowing” means (a) Loans of the same Class and Type, made, converted or
continued on the same date and, in the case of Eurodollar Loans, Eurocurrency
Loans and CDOR Loans, as to which a single Interest Period is in effect or (b) a
Swingline Loan.

 

“Borrowing Request” means a request by a Borrower for a Borrowing in accordance
with Section 2.03 and substantially in the form attached hereto as Exhibit 2.03
or such other form reasonably acceptable to the Applicable Agent.

 

“Business Acquisition” means (a) an Investment by any Borrower or any other
Person pursuant to which such Person shall become a Subsidiary of such Borrower
or shall be merged into or consolidated with such Borrower or any of its
Subsidiaries or (b) an acquisition by any Borrower or any of its respective
Subsidiaries of the property and assets of any Person that constitute
substantially all of the assets of such Person or any division or other business
unit of such Person.

 

“Business Day” means any day that is not a Saturday, Sunday or other day on
which commercial banks in New York City, New York, Denver, Colorado, London,
England, Toronto, Canada, and Luxembourg are authorized or required by Law to
remain closed; provided that, (a) when used in connection with a Eurodollar
Loan, the term “Business Day” shall also exclude any day on which banks are not
open for dealings in dollar deposits in the London interbank market and (b) when
used in connection with a Loan denominated in Euros, the term “Business Day”
shall also exclude any day that is not a TARGET Day.

 

4

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“Canadian Administrative Agent” means JPMorgan Chase Bank, N.A., Toronto Branch,
an Affiliate of the US Administrative Agent, acting at the request of the US
Administrative Agent, in its capacity as Canadian administrative agent for the
Lenders hereunder.

 

“Canadian Borrowers” means the Parent and DYNAenergetics Canada.

 

“Canadian Borrowing” means a Borrowing comprised of one or more Canadian Loans.

 

“Canadian Commitment” means, with respect to each Canadian Lender, the
commitment of such Lender to make Canadian Loans and to acquire participations
in Canadian Letters of Credit hereunder, expressed as an amount representing the
maximum aggregate amount of such Lender’s Canadian Credit Exposure hereunder, as
such commitment may be (a) reduced from time to time pursuant to Section 2.08 or
increased from time to time pursuant to Section 2.19 and (b) reduced or
increased from time to time pursuant to assignments by or to such Lender
pursuant to Section 2.18 or Section 10.04.  The initial amount of each such
Lender’s Canadian Commitment is set forth on Schedule 2.01, or in the Assignment
and Assumption pursuant to which such Lender shall have assumed its Canadian
Commitment, as applicable.  The initial aggregate amount of the Lenders’
Canadian Commitments is C$1,500,000.

 

“Canadian Credit Exposure” means, with respect to any Lender at any time, the
sum of the outstanding principal amount of such Lender’s Canadian Loans and its
Canadian LC Exposure at such time.

 

“Canadian Dealer Offered Rate” means, with respect to any Canadian Borrowing for
any Interest Period, on any day, the annual rate of interest which is the rate
determined as being the arithmetic average of the quotations of all institutions
listed in respect of such Interest Period for Canadian Dollar denominated
bankers’ acceptances displayed and identified as such on the “Reuters Screen
CDOR Page” as defined in the International Swap Dealer Association, Inc.
definitions, as modified and amended from time to time, as of 10:00 a.m., Local
Time, on such day and, if such day is not a Business Day, then on the
immediately preceding Business Day (as adjusted by the Canadian Administrative
Agent after such time to reflect any error in the posted average annual rate of
interest) plus 0.10%; provided that if such rates are not available on the
Reuters Screen CDOR Page on any particular day, then such rate on that day shall
be calculated as the cost of funds quoted by the Canadian Administrative Agent
to raise Canadian Dollars for such Interest Period as of 10:00 a.m., Local Time,
on such day for commercial loans and other extensions of credit to businesses of
comparable credit risk or, if such day is not a Business Day, then as quoted by
the Canadian Administrative Agent on the immediately preceding Business Day.

 

“Canadian Dollars” or “C$” means lawful currency of Canada.

 

“Canadian Issuing Lender” means JPMorgan Chase Bank, N.A., Toronto Branch, in
its capacity as the issuer of Canadian Letters of Credit hereunder, and its
successors in such capacity as provided in Section 2.05(i).  The Canadian
Issuing Lender may, in its discretion, arrange for one or more Canadian Letters
of Credit to be issued by Affiliates of the Canadian Issuing Lender, in which
case the term “Canadian Issuing Lender” shall include any Affiliate with respect
to Canadian Letters of Credit issued by such Affiliate.

 

5

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“Canadian LC Disbursement” means a payment made by the Canadian Issuing Lender
pursuant to a Canadian Letter of Credit.

 

“Canadian LC Exposure” means, at any time, the sum of (a) the aggregate undrawn
amount of all Canadian Letters of Credit at such time plus (b) the aggregate
amount of all Canadian LC Disbursements that have not yet been reimbursed by the
Canadian Borrowers or converted into a Canadian Loan pursuant to
Section 2.05(e) at such time.  The Canadian LC Exposure of any Lender at any
time shall be its Applicable Percentage of the total Canadian LC Exposure at
such time.

 

“Canadian Lender” means a Lender with a Canadian Commitment or, if the Canadian
Commitments have terminated or expired, a Lender with Canadian Credit Exposure.

 

“Canadian Letter of Credit” means any Letter of Credit denominated in Canadian
Dollars issued pursuant to Section 2.05 of this Agreement.

 

“Canadian Loan” means a Loan made pursuant to Section 2.01(c).

 

“Canadian Prime”, when used in reference to any Canadian Loan or Canadian
Borrowing, refers to whether such Loan, or the Loans comprising such Borrowing,
are bearing interest at a rate determined by reference to the Canadian Prime
Rate.

 

“Canadian Prime Rate” means, for any period, a fluctuating interest rate per
annum as in effect from time to time which rate per annum shall at all times be
equal to the percentage rate per annum determined by the Canadian Administrative
Agent (rounded up to two decimal places) to be the greater of (a) the rate of
interest that the Canadian Administrative Agent establishes at the time as the
reference rate of interest for determination of interest rates it will charge
for loans in Canadian Dollars at its office in Toronto, Canada and to which it
refers as its prime rate (or its equivalent or analogous such rate) or (b) the
sum of (i) the yearly rate of interest to which the one-month CDOR is equivalent
plus (ii) 1% per annum.

 

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

 

“CDOR”, when used in reference to any Canadian Loan or Canadian Borrowing,
refers to whether such Loan, or the Loans comprising such Borrowing, are bearing
interest at a rate determined by reference to the Canadian Dealer Offered Rate.

 

“Change in Control” means (a) any Person or group (within the meaning of
Rule 13d-5 of the Securities and Exchange Commission under the Securities
Exchange Act of 1934 as in effect on the Effective Date) shall become the
beneficial owner (as defined in Rule 13d-3 of the Securities and Exchange
Commission under the Securities Exchange Act of 1934 as in effect on the
Effective Date) of issued and outstanding Equity Interests of the Parent
representing more than 35% of the aggregate voting power in elections for
directors of the Parent on a fully diluted

 

6

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basis; or (b) a majority of the members of the board of directors of the Parent
shall cease to be either (i) Persons who were members of the board of directors
on the Effective Date or (ii) Persons who became members of such board of
directors after the Effective Date and whose election or nomination was approved
by a vote or consent of the majority of the members of the board of directors
that are either described in clause (i) above or who were elected under this
clause (ii).

 

“Change in Law” means the occurrence, after the Effective Date (or with respect
to any Lender, if later, the date on which such Lender becomes a Lender), of any
of the following: (a) the adoption or taking into effect of any Law, (b) any
change in any Law 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) of any
Governmental Authority; provided, however, that notwithstanding anything herein
to the contrary, (x) the Dodd-Frank Wall Street Reform and Consumer Protection
Act and all requests, rules, guidelines or directives thereunder or issued in
connection therewith and (y) all requests, rules, regulations, guidelines or
directives promulgated by the Bank for International Settlements, the Basel
Committee on Banking Regulations and Supervisory Practices (or any successor or
similar authority) or Governmental Authority with respect to the implementation
of the Basel III Accord shall, in each case, be deemed to be a “Change in Law”,
regardless of the date enacted, adopted or issued.

 

“Class”, when used in reference to any Loan or Borrowing, refers to whether such
Loan, or the Loans comprising such Borrowing, are US Loans, Euro Loans, Canadian
Loans, US Swingline Loans or Euro Swingline Loans and, when used in reference to
any Commitment, refers to whether such Commitment is a US Commitment, a Euro
Commitment or a Canadian Commitment, and when used in reference to any Lender,
refers to whether such Lender has a US Commitment, a Euro Commitment or a
Canadian Commitment.

 

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

 

“Collateral” means all of the property described in the Security Agreements
serving as security for the Loans.

 

“Commitment” means any US Commitment, Euro Commitment or Canadian Commitment, as
the context may require, and “Commitments” means any or all of the foregoing, as
the context may require.

 

“Commitment Fee Rate” means, on any day, the applicable per annum percentage set
forth at the appropriate intersection in the table shown below, based on the
Leverage Ratio for the most recently ended trailing four-quarter period with
respect to which the Parent is required to have delivered the financial
statements pursuant to Section 5.01(a) or Section 5.01(b), as applicable (as
such Leverage Ratio is reflected in the Compliance Certificate delivered
pursuant to Section 5.01(c) in connection with such financial statements):

 

Level

 

Leverage Ratio

 

Commitment Fee Rate

 

I

 

1.00 > X

 

0.200

%

II

 

1.50 > X> 1.00

 

0.250

%

III

 

X > 1.50

 

0.300

%

 

7

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Each change in the Commitment Fee Rate shall take effect on each date on which
such financial statements and Compliance Certificate are required to be
delivered pursuant to Section 5.01(a) or Section 5.01(b), as applicable, and
Section 5.01(c), commencing with the date on which such financials statements
and Compliance Certificate are required to be delivered for the fiscal year
ending December 31, 2011.  Notwithstanding the foregoing, for the period from
the Effective Date through the date the financial statements and Compliance
Certificate are required to be delivered pursuant to Section 5.01(a) and
Section 5.01(c) for the fiscal year ending December 31, 2011, the Commitment Fee
Rate shall be determined at Level I.  In the event any financial statement
delivered pursuant to Section 5.01(a) or Section 5.01(b), as applicable, is
shown to be inaccurate when delivered (regardless of whether this Agreement or
the Commitments are in effect when such inaccuracy is discovered), and such
inaccuracy, if corrected, would have led to a higher Commitment Fee Percentage
for any period (an “Applicable Commitment Fee Period”) than the Commitment Fee
Percentage applied for such Applicable Commitment Fee Period, and only in such
case, then the Parent shall immediately (i) deliver to the US Administrative
Agent corrected financial statements for such Applicable Commitment Fee Period,
(ii) determine the Commitment Fee Percentage for such Applicable Commitment Fee
Period based on the corrected financial statements, and (iii) immediately pay to
the US Administrative Agent the additional accrued commitment fees owing as a
result of such increased Commitment Fee Rate for such Applicable Commitment Fee
Period, which payment shall be promptly applied by the US Administrative Agent
in accordance with Section 2.11.  This provision is in addition to the rights of
the Agents and Lenders with respect to Section 2.12(g) and their other
respective rights under this Agreement.  If the Parent fails to deliver the
financial statements and corresponding Compliance Certificate to the US
Administrative Agent at the time required pursuant to Section 5.01, then
effective as of the date such financial statements and corresponding Compliance
Certificate were required to be delivered pursuant to Section 5.01, the
Commitment Fee Rate shall be determined at Level III and shall remain at such
level under the date such financial statements and corresponding Compliance
Certificate are so delivered by the Parent.

 

“Commitment Increase Agreement” means a Commitment Increase Agreement entered
into by a Lender in accordance with Section 2.19(d) and accepted by the US
Administrative Agent in the form of Exhibit 1.1D or any other form approved by
the US Administrative Agent.

 

“Commitment Increase Notice” has the meaning set forth in Section 2.19(a).

 

“Compliance Certificate” has the meaning set forth in Section 5.01(c).

 

“Connection Income Taxes” means Other Connection Taxes that are imposed on or
measured by net income (however denominated) or that are franchise Taxes or
branch profits Taxes.

 

“Consolidated EBITDA” means, for any Person, for any period, Net Income of such
Person and its consolidated Subsidiaries determined on a consolidated basis in
accordance with GAAP for such period, plus, to the extent deducted in the
determination of such Net Income and without duplication, (a) provisions for
income taxes, (b) Interest Expense, (c) depreciation and

 

8

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amortization expense, (d) extraordinary, non-recurring charges and (e) other
non-cash charges; and minus, to the extent included in the determination of such
Net Income and without duplication, (i) interest income, (ii) extraordinary,
non-recurring income, revenue or gains and (iii) other non-cash income.

 

“Consolidated Funded Indebtedness” of any Person, means, without
duplication, Indebtedness of such Person and its consolidated Subsidiaries,
determined on a consolidated basis in accordance with GAAP, evidenced by a note,
bond, debenture or similar instrument with regularly scheduled interest payments
and a maturity date.

 

“Consolidated Pro Forma EBITDA” means, for any Person, for any period, without
duplication, Consolidated EBITDA of such Person, (i) plus the Consolidated
EBITDA for such period of any Subsidiary of such Person acquired during such
period, as if acquired on the first day of such period and (ii) minus the
Consolidated EBITDA for such period of any Subsidiary of such Person disposed of
during such period, as if disposed of on the first day of such period,
determined in a manner reasonably satisfactory to US Administrative Agent.

 

“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.

 

“Credit Exposure” means, with respect to any Lender at any time, the sum of the
outstanding principal amount of such Lender’s US Credit Exposure, Euro Credit
Exposure and Canadian Credit Exposure at such time.  For purposes of determining
Credit Exposure, the Euro Credit Exposure and the Canadian Credit Exposure shall
be converted to Dollars at rates determined by the US Administrative Agent.

 

“Credit Party” means any Agent, Issuing Lender, Swingline Lender or any other
Lender.

 

“Default” means any event or condition that constitutes an Event of Default or
that upon notice, lapse of time or both would, unless cured or waived, become an
Event of Default.

 

“Default Rate” means a rate per annum equal to (a) with respect to overdue
principal of any Loan, the rate otherwise applicable to such Loan plus 2% and
(b) with respect to all other amounts, the rate otherwise applicable to ABR
Loans plus 2%.

 

“Defaulting Lender” means any Lender that (a) has failed, within two Business
Days of the date required to be funded or paid, to (i) fund any portion of its
Loans, (ii) fund any portion of its participations in Letters of Credit or
Swingline Loans or (iii) pay over to any Credit Party any other amount required
to be paid by it hereunder, unless, in the case of clause (i) above, such Lender
notifies the Applicable Agent (and the US Administrative Agent if it shall not
be the Applicable Agent) in writing that such failure is the result of such
Lender’s good faith determination that a condition precedent to funding
(specifically identified and including the particular default, if any) has not
been satisfied, (b) has notified the Parent or any Credit Party in writing, or
has made a public statement to the effect, that it does not intend or expect to
comply with any of its funding obligations under this Agreement (unless such
writing or public statement indicates that such position is based on such
Lender’s good faith determination that a condition

 

9

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precedent (specifically identified and including the particular default, if any)
to funding a loan under this Agreement cannot be satisfied) or generally under
other agreements in which it commits to extend credit, (c) has failed, within
three Business Days after request by a Credit Party, acting in good faith, to
provide a certification in writing from an authorized officer of such Lender
that it will comply with its obligations (and is financially able to meet such
obligations) to fund prospective Loans and participations in then outstanding
Letters of Credit and Swingline Loans under this Agreement, provided that such
Lender shall cease to be a Defaulting Lender pursuant to this clause (c) upon
such Credit Party’s receipt of such certification in form and substance
satisfactory to it and the Applicable Agent (and the US Administrative Agent if
it shall not be the Applicable Agent), or (d) has become the subject of a
Bankruptcy Event.

 

“Disposition” means sale, lease, conveyance or other disposition.

 

“Dollars” or “$” refers to lawful money of the United States of America.

 

“Domestic Subsidiary” means any Subsidiary of the Parent (other than a
Subsidiary of any Foreign Subsidiary) that is a U.S. Person.

 

“DYNAenergetics Canada” means DYNAenergetics Canada Inc., a corporation existing
under the laws of Alberta, Canada, a Wholly Owned Subsidiary of the Parent.

 

“Effective Date” means the date on which the conditions specified in
Section 4.01 are satisfied (or waived in accordance with Section 10.02).

 

“Environmental Laws” means all Laws, notices or binding agreements issued,
promulgated or entered into by any Governmental Authority, relating in any way
to the environment, preservation or reclamation of natural resources, the
management, release or threatened release of any Hazardous Material or to health
and safety matters.

 

“Environmental Liability” means any liability, contingent or otherwise
(including any liability for damages, costs of environmental remediation, fines,
penalties or indemnities), of any of the Borrowers 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.

 

“Equity Interests” means shares of capital stock, partnership interests,
membership interests in a limited liability company, beneficial interests in a
trust or other equity ownership interests in a Person, and any warrants, options
or other rights entitling the holder thereof to purchase or acquire any such
equity interest.

 

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

 

“ERISA Affiliate” means any trade or business (whether or not incorporated)
that, together with the Parent, is treated as a single employer under
Section 414(b) or (c) of the Code

 

10

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

 

or, solely for purposes of Section 302 of ERISA and Section 412 of the Code, is
treated as a single employer under Section 414 of the Code.

 

“ERISA Event” means (a) any “reportable event”, as defined in Section 4043 of
ERISA or the regulations issued thereunder with respect to a Plan (other than an
event for which the 30-day notice period is waived); (b) the existence with
respect to any Plan of any unpaid “minimum required contribution” (as defined in
Section 430 of the Code or Section 303 of ERISA), whether or not waived, or with
respect to a Multiemployer Plan, any “accumulated funding deficiency” (as
defined in Section 431 of the Code or Section 304 of ERISA), whether or not
waived; (c) the filing pursuant to Section 412(c) of the Code or
Section 302(c) of ERISA of an application for a waiver of the minimum funding
standard with respect to any Plan; (d) the incurrence by the Parent or any of
its ERISA Affiliates of any liability under Title IV of ERISA with respect to
the termination of any Plan; (e) the receipt by the Parent or any ERISA
Affiliate from the PBGC or a plan administrator of any notice relating to an
intention to terminate any Plan or Plans or to appoint a trustee to administer
any Plan; (f) the incurrence by the Parent or any of its ERISA Affiliates of any
liability with respect to the withdrawal or partial withdrawal from any Plan or
Multiemployer Plan; or (g) the receipt by the Parent or any ERISA Affiliate of
any notice, or the receipt by any Multiemployer Plan from the Parent or any
ERISA Affiliate of any notice, concerning the imposition of Withdrawal Liability
or a determination that a Multiemployer Plan is, or is expected to be, insolvent
or in reorganization, within the meaning of Title IV of ERISA.

 

“EURIBOR” means, in relation to any Euro Loan for any Interest Period, an
interest rate per annum equal to the applicable Screen Rate as of 11:00 a.m.
Brussels, Belgium time on the second TARGET Day (excluding any TARGET Day that
is not a Business Day) prior to the beginning of such Interest Period for the
offering of deposits in Euro for a period comparable to the Interest Period of
the relevant Loan.

 

“Euro”, “Euros” and “€” mean the single currency of the Participating Member
States.

 

“Euro Administrative Agent” means J.P. Morgan Europe Limited in London, England,
an Affiliate of the US Administrative Agent, acting at the request of the US
Administrative Agent, in its capacity as Euro administrative agent for the
Lenders hereunder.

 

“Euro Borrowers” means the Parent and the Wholly Owned Subsidiaries of the
Parent that are organized under the laws of a Participating Member State and
that are identified as Euro Borrowers on the signature pages hereto.

 

“Euro Borrowing” means a Borrowing comprised of one or more Euro Loans.

 

“Euro Commitment” means, with respect to each Euro Lender, the commitment of
such Lender to make Euro Loans and to acquire participations in Euro Letters of
Credit and Euro Swingline Loans hereunder, expressed as an amount representing
the maximum aggregate amount of such Lender’s Euro Credit Exposure hereunder, as
such commitment may be (a) reduced from time to time pursuant to Section 2.08 or
increased from time to time pursuant to Section 2.19 and (b) reduced or
increased from time to time pursuant to assignments by or to such Lender
pursuant to Section 2.18 or Section 10.04.  The initial amount of each such
Lender’s Euro Commitment is set forth on Schedule 2.01, or in the Assignment and
Assumption pursuant

 

11

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to which such Lender shall have assumed its Euro Commitment, as applicable.  The
initial aggregate amount of the Lenders’ Euro Commitments is €16,000,000.

 

“Euro Credit Exposure” means, with respect to any Lender at any time, the sum of
the outstanding principal amount of such Lender’s Euro Loans and its Euro LC
Exposure and its Euro Swingline Exposure at such time.

 

“Euro Issuing Lender” means J.P. Morgan Europe Limited, in its capacity as the
issuer of Euro Letters of Credit hereunder, and its successors in such capacity
as provided in Section 2.05(i).  The Euro Issuing Lender may, in its discretion,
arrange for one or more Euro Letters of Credit to be issued by Affiliates of the
Euro Issuing Lender, in which case the term “Euro Issuing Lender” shall include
any Affiliate with respect to Euro Letters of Credit issued by such Affiliate.

 

“Euro LC Disbursement” means a payment made by the Euro Issuing Lender pursuant
to a Euro Letter of Credit.

 

“Euro LC Exposure” means, at any time, the sum of (a) the aggregate undrawn
amount of all Euro Letters of Credit at such time plus (b) the aggregate amount
of all Euro LC Disbursements that have not yet been reimbursed by the Euro
Borrowers or converted into a Euro Loan or Euro Swingline Loan pursuant to
Section 2.05(e) at such time.  The Euro LC Exposure of any Lender at any time
shall be its Applicable Percentage of the total Euro LC Exposure at such time.

 

“Euro Lender” means a Lender with a Euro Commitment or, if the Euro Commitments
have terminated or expired, a Lender with Euro Credit Exposure.

 

“Euro Letter of Credit” means any Letter of Credit denominated in Euros and
issued pursuant to Section 2.05 of this Agreement.

 

“Euro Loan” means a Loan made pursuant to Section 2.01(b).

 

“Euro Swingline Exposure” means, at any time, the aggregate principal amount of
all Euro Swingline Loans outstanding at such time.  The Euro Swingline Exposure
of any Lender at any time shall be its Applicable Percentage of the total Euro
Swingline Exposure at such time.

 

“Euro Swingline Lender” means J.P. Morgan Europe Limited, in its capacity as
lender of Euro Swingline Loans hereunder.

 

“Euro Swingline Loan” means a Loan made in Euros pursuant to Section 2.05.

 

“Euro Swingline Rate” means, in relation to a Euro Swingline Loan, the
percentage rate per annum which is the aggregate of:

 

(a)                                  the arithmetic mean of the rates (rounded
upwards to four decimal places) as supplied to the Euro Administrative Agent at
its request quoted by the Reference Bank to leading banks in the European
interbank market as of 11.00 a.m., Local Time on the date of Borrowing

 

12

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for that Euro Swingline Loan for the offering of deposits in Euro for a period
comparable to the Interest Period for the relevant Euro Swingline Loan and for
settlement on that day;

 

(b)                                 1.75 per cent per annum; and

 

(c)                                  Mandatory Cost (if any).

 

“Eurocurrency”, when used in reference to any Euro Loan or Euro Borrowing,
refers to whether such Loan, or the Loans comprising such Borrowing, are bearing
interest at a rate determined by reference to the EURIBOR.

 

“Eurocurrency Rate” means EURIBOR.

 

“Eurodollar”, when used in reference to any US Loan or US Borrowing, refers to
whether such Loan, or the Loans comprising such Borrowing, are bearing interest
at a rate determined by reference to the Adjusted LIBO Rate.

 

“Event of Default” has the meaning assigned to such term in Section 7.01.

 

“Excluded Taxes” means any of the following Taxes imposed on or with respect to
a Recipient or required to be withheld or deducted from a payment to a
Recipient, (a) Other Connection Taxes, including Connection Income Taxes, (b) in
the case of a Lender, U.S. federal withholding Taxes imposed on amounts payable
to or for the account of such Lender with respect to an applicable interest in a
Loan or Commitment pursuant to a law in effect on the date on which (i) such
Lender acquires such interest in the Loan or Commitment (other than pursuant to
an assignment request by the Parent under Section 2.18(b)) or (ii) such Lender
changes its lending office, except in each case to the extent that, pursuant to
Section 2.16, amounts with respect to such Taxes were payable either to such
Lender’s assignor immediately before such Lender became a party hereto or to
such Lender immediately before it changed its lender office, (c) Taxes
attributable to such Recipient’s failure to comply with Section 2.16(e) and
(d) any U.S. federal withholding Taxes imposed under FATCA.

 

“Existing Letter of Credit” means that certain letter of credit dated
February 4, 2010, issued by JPMorgan Chase Bank, N.A., in its capacity as
issuing lender under the Prior Agreement, in the amount of $29,311.20.

 

“FATCA” means Sections 1471 through 1474 of the Code (or any amended or
successor version) and any current or future regulations or official
interpretations thereof.

 

“Federal Funds Effective Rate” means, for any day, the weighted average (rounded
upwards, if necessary, to the next 1/100 of 1%) of the rates on overnight
Federal funds transactions with members of the Federal Reserve System arranged
by Federal funds brokers, as published on the next succeeding Business Day by
the Federal Reserve Bank of New York, or, if such rate is not so published for
any day that is a Business Day, the average (rounded upwards, if necessary, to
the next 1/100 of 1%) of the quotations for such day for such transactions
received by the US Administrative Agent from three Federal funds brokers of
recognized standing selected by it.

 

13

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“Fee Letter” means the letter agreement, dated November 22, 2011, among the
Parent, the Agents and the sole book runner and lead arranger.

 

“Financial Officer” means the chief financial officer, principal accounting
officer, treasurer or controller of the Parent.

 

“Fitch” means Fitch Ratings, Ltd.

 

“Fixed Charge Coverage Ratio” means, for any period, the ratio of
(a) Consolidated EBITDA to (b) Fixed Charges.

 

“Fixed Charges” means, for any period of determination, without duplication, the
sum of (a) cash Interest Expense, (b) cash dividends, (c) cash income Taxes and
(d) an amount equal to 75% of depreciation expense, in each case, for the Parent
and its Subsidiaries, determined on a consolidated basis in accordance with
GAAP.

 

“Foreign Guarantors” means each of the Parent’s existing and subsequently
acquired or organized Wholly Owned Subsidiaries that are Foreign Subsidiaries,
including, without limitation, the Euro Borrowers and the Canadian Borrowers,
which Subsidiaries guarantee the Obligations of the Euro Borrowers and the
Canadian Borrowers under the Loan Documents.

 

“Foreign Lender” means any Lender that is not a U.S. Person.

 

“Foreign Subsidiary” means a Subsidiary of the Parent that is not a U.S. Person.

 

“GAAP” means generally accepted accounting principles in the United States of
America.

 

“Governmental Approval” means (i) any authorization, consent, approval, license,
waiver, or exemption, by or with; (ii) any notice to; (iii) any declaration of
or with; or (iv) any registration by or with, or any other action or deemed
action by or on behalf of, any Governmental Authority.

 

“Governmental Authority” means the government of the United States of America,
any other nation or 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.

 

“guarantee” of or by any Person (the “guarantor”) means any obligation,
contingent or otherwise, of the guarantor guaranteeing or having the economic
effect of guaranteeing any Indebtedness of any other Person (the “primary
obligor”) in any manner, whether directly or indirectly, and including any
obligation of the guarantor, direct or indirect, (a) to purchase or pay (or
advance or supply funds for the purchase or payment of) such Indebtedness or to
purchase (or to advance or supply funds for the purchase of) any security for
the payment thereof, (b) to purchase or lease property, securities or services
for the purpose of assuring the owner of such Indebtedness of the payment
thereof, (c) to maintain working capital, equity capital or any other financial
statement condition or liquidity of the primary obligor so as to enable the
primary

 

14

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obligor to pay such Indebtedness or (d) as an account party in respect of any
letter of credit or letter of guaranty issued to support such Indebtedness;
provided, that the term guarantee shall not include endorsements for collection
or deposit in the ordinary course of business.  The amount of any guarantee of
any guarantor shall be deemed to be the lower of (i) an amount equal to the
stated or determinable amount of the primary obligation in respect of which such
guarantee is made and (ii) the maximum amount for which such guarantor may be
liable pursuant to the terms of the instrument embodying such guarantee, unless
such primary obligation and the maximum amount for which such guarantor may be
liable are not stated or determinable, in which case the amount of such
guarantee shall be such guarantor’s maximum reasonably anticipated liability in
respect thereof as determined by the Parent in good faith.

 

“Guarantees” means the guarantees issued pursuant to this Agreement as contained
in Article IX.

 

“Guarantors” means the US Guarantors and the Foreign Guarantors.

 

“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.

 

“Indebtedness” of any Person means, without duplication, (a) all obligations of
such Person for borrowed money or with respect to deposits or advances of any
kind, (b) all obligations of such Person evidenced by bonds, debentures, notes
or similar instruments, (c) all obligations of such Person upon which interest
charges are customarily paid, (d) all obligations of such Person under
conditional sale or other title retention agreements relating to property
acquired by such Person, (e) all obligations of such Person in respect of the
deferred purchase price of property or services (excluding current accounts
payable incurred in the ordinary course of business), (f) all Indebtedness of
others secured by (or for which the holder of such Indebtedness has an existing
right, contingent or otherwise, to be secured by) any Lien on property owned or
acquired by such Person, whether or not the Indebtedness secured thereby has
been assumed, (g) all guarantees by such Person of Indebtedness of others,
(h) the principal portion of all Capital Lease Obligations of such Person,
(i) all obligations, contingent or otherwise, of such Person as an account party
in respect of letters of credit and letters of guaranty and (j) all obligations,
contingent or otherwise, of such Person in respect of bankers’ acceptances.  The
Indebtedness of any Person shall include the Indebtedness of any other entity
(including any partnership in which such Person is a general partner) to the
extent such Person is liable therefor as a result of such Person’s ownership
interest in or other relationship with such entity, except to the extent the
terms of such Indebtedness provide that such Person is not liable therefor.

 

“Indemnified Taxes” means Taxes other than Excluded Taxes and Other Taxes.

 

“Indemnitee” has the meaning set forth in Section 10.03(b).

 

“Interest Election Request” means (a) a request by a US Borrower to convert or
continue a Eurodollar Borrowing, (b) a request by a Euro Borrower to continue a
Eurocurrency Borrowing

 

15

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or (c) a request by a Canadian Borrower to convert or continue a CDOR Borrowing,
in each case in accordance with Section 2.07 and substantially in the form
attached hereto as Exhibit 2.07 or such other form reasonably acceptable to the
Applicable Agent.

 

“Interest Expense” means, for any Person, for any period, determined on a
consolidated basis in accordance with GAAP, the sum of  all interest on
Indebtedness paid or payable (including the portion of rents payable under
Capital Lease Obligations allocable to interest) in or for such period, plus all
original issue discount and other interest expense associated with Indebtedness
accreted or amortized or required to be accreted or amortized in or for such
period.

 

“Interest Payment Date” means (a) with respect to any ABR Loan (other than a US
Swingline Loan) or any Canadian Prime Rate Loan, the last day of each March,
June, September and December and the Termination Date; (b) with respect to any
Eurodollar Loan, Eurocurrency Loan or CDOR Loan, the last day of the Interest
Period applicable to the Borrowing of which such Loan is a part and, in the case
of a Eurodollar, Eurocurrency or CDOR Borrowing with an Interest Period of more
than three months’ duration, each day prior to the last day of such Interest
Period that occurs at intervals of three months’ duration after the first day of
such Interest Period; and (c) with respect to any Swingline Loan, the day that
such Loan is required to be repaid.

 

“Interest Period” means with respect to any Eurodollar Borrowing, Eurocurrency
Borrowing or CDOR Borrowing, the period commencing on the date of such Borrowing
and ending on the numerically corresponding day in the calendar month that is
one, two, three or six months thereafter, as the applicable Borrower may elect;
provided, that (i) if any Interest Period would end on a day other than a
Business Day, such Interest Period shall be extended to the next succeeding
Business Day, unless such next succeeding Business Day would fall in the next
calendar month, in which case such Interest Period shall end on the next
preceding Business Day, and (ii) any Interest Period that commences on the last
Business Day of a calendar month (or on a day for which there is no numerically
corresponding day in the last calendar month of such Interest Period) shall end
on the last Business Day of the last calendar month of such Interest Period. 
For purposes hereof, the date of a Borrowing initially shall be the date on
which such Borrowing is made and thereafter shall be the effective date of the
most recent conversion or continuation of such Borrowing.

 

“Investment” means any investment in any Person, whether by means of a purchase
of Equity Interests or debt securities, capital contribution, loan, guarantee,
time deposit or otherwise (but not including any demand deposit).

 

“Issuing Lenders” means the US Issuing Lender, the Euro Issuing Lender and the
Canadian Issuing Lender.

 

“Joinder Agreement” means those agreements in the form of Exhibit 1.1B(i) and
Exhibit 1.1B(ii).

 

“Law” means all laws, statutes, treaties, ordinances, codes, acts, rules,
regulations, Government Approvals and Orders of all Governmental Authorities,
whether now or hereafter in effect.

 

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“LC Disbursement” means a payment made by the Issuing Lender pursuant to a
Letter of Credit.

 

“LC Exposure” means, at any time, the sum of (a) the aggregate undrawn amount of
all outstanding Letters of Credit at such time plus (b) the aggregate amount of
all LC Disbursements that have not yet been reimbursed by or on behalf of the
US Borrower or converted into a Loan pursuant to Section 2.05(e) at such time. 
The LC Exposure of any Lender at any time shall be its Applicable Percentage of
the total LC Exposure at such time.

 

“Lender Parent” means, with respect to any Lender, any Person as to which such
Lender is, directly or indirectly, a Subsidiary.

 

“Lenders” means the Persons listed on Schedule 2.01 and any other Person that
shall have become a party hereto pursuant to an Assignment and Assumption, other
than any such Person that ceases to be a party hereto pursuant to an Assignment
and Assumption.  Unless the context otherwise requires, the term “Lenders”
includes the US Swingline Lender and the Euro Swingline Lender.

 

“Letter of Credit” means any letter of credit issued pursuant to Section 2.05 of
this Agreement.

 

“Leverage Ratio” means, for any trailing four quarter period, the ratio of
Consolidated Funded Indebtedness of the Parent on the last day of such period to
Consolidated Pro Forma EBITDA of the Parent for such trailing four-quarter
period.

 

“LIBO Rate” means, with respect to any Eurodollar Borrowing for any Interest
Period, the rate appearing on the Reuters Reference Screen LIBOR01 page (or any
successor thereto or substitute therefor provided by Reuters, providing rate
quotations comparable to those currently provided on such page, as determined by
the US Administrative Agent from time to time for purposes of providing
quotations of interest rates applicable to dollar deposits in the London
interbank market) at approximately 11:00 a.m., Local Time, two (2) Business Days
prior to the commencement of such Interest Period, as the rate for dollar
deposits with a maturity comparable to such Interest Period.  In the event that
such rate is not available at such time for any reason, then the “LIBO Rate”
with respect to such Eurodollar Borrowing for such Interest Period shall be the
rate at which dollar deposits of $5,000,000 and for a maturity comparable to
such Interest Period are offered by the principal London, England office of the
US Administrative Agent in immediately available funds in the London interbank
market at approximately 11:00 a.m., Local Time, two Business Days prior to the
commencement of such Interest Period.

 

“Lien” means, with respect to any asset, (a) any mortgage, deed of trust, lien,
pledge, hypothecation, charge or security interest in, on or of such asset,
(b) the interest of a vendor or a lessor under any conditional sale agreement,
capital lease or title retention agreement (or any financing lease having
substantially the same economic effect as any of the foregoing) relating to such
asset and (c) in the case of securities, any purchase option, call or similar
right of a third party with respect to such securities.

 

“Loan Documents” means this Agreement, any applications for Letters of Credit
and reimbursement agreements relating thereto, the Security Documents, the Fee
Letter, any

 

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Commitment Increase Agreements and New Lender Agreements and each Swap Agreement
with any Lender or Affiliate thereof entered into pursuant to Section 6.06 or
pursuant to the Prior Agreement.

 

“Loans” means the loans made by the Lenders to the US Borrowers, the Euro
Borrowers or the Canadian Borrowers, as applicable, pursuant to this Agreement,
including the Swingline Loans.

 

“Local Time” means (a) with respect to a Loan denominated in Dollars, New York
City, New York time, (b) with respect to a Loan denominated in Euros, London,
England time, and (c) with respect to a Loan denominated in Canadian Dollars,
Toronto, Canada time.

 

“Mandatory Cost” means the percentage rate per annum calculated by the Euro
Administrative Agent in accordance with Exhibit 1.1C.

 

“Material Adverse Effect” means a material adverse effect on (i) the business,
operations, assets, property, or condition (financial or otherwise) of any
Borrower and its Subsidiaries, taken as a whole, (ii) the ability of the
Borrowers or Guarantors to perform their Obligations under the Loan Documents,
(iii) the validity or enforceability of any of the Loan Documents or (iv) the
rights and remedies of the Agents and the Lenders under the Loan Documents.

 

“Material Contract” means any contract or agreement, written or oral, to which
any Borrower or any of its Subsidiaries is a party to the extent a default under
such contract could reasonably be expected to have a Material Adverse Effect.

 

“Material Indebtedness” means Indebtedness (other than the Loans and Letters of
Credit) or obligations in respect of one or more Swap Agreements, of any one or
more of the Borrowers and their respective Subsidiaries in an aggregate
principal amount exceeding $2,000,000.  For purposes of determining Material
Indebtedness, the “principal amount” of the obligations of any Borrower or any
of its Subsidiaries in respect of any Swap Agreement at any time shall be the
maximum aggregate amount (giving effect to any netting agreements) that such
Borrower or such Subsidiary would be required to pay if such Swap Agreement were
terminated at such time.

 

“Moody’s” means Moody’s Investors Service, Inc.

 

“Mortgaged Property” means the real property covered by the Mortgages.

 

“Mortgages” means (a) that certain Open-End Mortgage, Assignment of Leases and
Rents, Security Agreement and Fixture Filing dated as of November 16, 2007,
executed by the Parent in favor of the US Administrative Agent in respect of
certain property located in Hartford County, Connecticut, as more particularly
described therein, as assigned by the Parent to AMK Welding, Inc. (b) that
certain Open-End Mortgage, Assignment of Leases and Rents, Security Agreement
and Fixture Filing dated as of November 12, 2007, effective as of November 16,
2007, executed by the Parent in favor of the US Administrative Agent in respect
of certain property located in Fayette County, Pennsylvania, as more
particularly described therein and (c) that certain Open-End Leasehold Mortgage,
Assignment of Leases and Rents, Security Agreement and Fixture Filing dated as
of November 16, 2007, executed by the Parent in favor of

 

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the US Administrative Agent in respect of certain property located in Fayette
County, Pennsylvania, as more particularly described therein.

 

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

 

“Net Income” means, for any Person, for any period, the net income or loss of
the for such period determined on a consolidated basis in accordance with GAAP.

 

“New Lender” has the meaning set forth in Section 2.19(c).

 

“New Lender Agreement” means a New Lender Agreement entered into by a New Lender
in accordance with Section 2.19(c) and accepted by the US Administrative Agent
in the form of Exhibit 1.1E or any other form approved by the US Administrative
Agent.

 

“Obligations” means all of the duties, obligations and liabilities of any kind
of the Borrowers and each Guarantor hereunder or under any of the Loan Documents
or in respect of Bank Products.

 

“Obligors” means the Borrowers and each Guarantor.

 

“Order” means an order, writ, judgment, award, injunction, decree, ruling or
decision of any Governmental Authority or arbitrator.

 

“Other Connection Taxes” means, with respect to any Recipient, Taxes imposed as
a result of a present or former connection between such Recipient and the
jurisdiction imposing such Tax (other than connections arising from such
Recipient having executed, delivered, become a party to, performed its
obligations under, received payments under, received or perfected a security
interest under, engaged in any other transaction pursuant to or enforced any
Loan Document, or sold or assigned an interest in any Loan or Loan Document).

 

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

 

“Parent” has the meaning given in the preamble.

 

“Participant” has the meaning set forth in Section 10.04.

 

“Participating Member State” means a member state of the European Community that
adopts or has adopted the Euro as its lawful currency under the legislation of
the European Union for European Monetary Union.

 

“PBGC” means the Pension Benefit Guaranty Corporation referred to and defined in
ERISA and any successor entity performing similar functions.

 

“Permitted Encumbrances” means:

 

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(a)                                  Liens imposed by law for Taxes that are not
yet due or are being contested in compliance with Section 5.04;

 

(b)                                 carriers’, warehousemen’s, mechanics’,
materialmen’s, repairmen’s, landlords’, suppliers’, processors’ and other like
Liens imposed by Law, arising in the ordinary course of business and securing
obligations that are not overdue by more than 30 days or are being contested in
compliance with Section 5.04;

 

(c)                                  pledges and deposits made in the ordinary
course of business in compliance with workers’ compensation, unemployment
insurance and other social security laws or regulations;

 

(d)                                 utility deposits and deposits to secure the
performance of bids, tenders, contracts, leases, statutory obligations, surety
and appeal bonds (or deposits made to otherwise secure an appeal, stay or
discharge in the course of any legal proceeding), performance or completion
bonds and other obligations of a like nature, in each case in the ordinary
course of business;

 

(e)                                  judgment liens in respect of judgments that
do not constitute an Event of Default under clause (k) of Section 7.01;

 

(f)                                    easements, zoning restrictions,
rights-of-way, reservations, subdivisions and similar encumbrances or rights of
others for rights-of-way, utilities and other similar purposes, or zoning or
other restrictions as to the use of owned or leased real property and minor
defects and irregularities in title on real property imposed by law or arising
in the ordinary course of business that do not secure any monetary obligations
and do not materially detract from the value of the affected property or
interfere with the ordinary conduct of business of either Borrower or any of its
respective Subsidiaries;

 

(g)                                 Liens arising from filing UCC financing
statements regarding leases permitted by this Agreement; and

 

(h)                                 Liens of licensors on licenses or
sublicenses of Intellectual Property;

 

provided that the term “Permitted Encumbrances” shall not include any Lien
securing Indebtedness.

 

“Permitted Investments” means:

 

(a)                                  direct obligations of, or obligations the
principal of and interest on which are unconditionally guaranteed by, the United
States of America (or by any agency or instrumentality thereof to the extent
such obligations are backed by the full faith and credit of the United States of
America), in each case maturing within one year from the date of acquisition
thereof;

 

(b)                                 Euro-denominated securities issued or
unconditionally guaranteed or insured by any Participating Member State or
Switzerland (or by any agency or instrumentality thereof to the extent such
securities are backed by the full faith and credit of such Participating Member
State), in each case maturing within one year from the date of acquisition
thereof;

 

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(c)           investments in commercial paper maturing within one year from the
date of acquisition thereof and having, at such date of acquisition, a rating of
at least F1 by Fitch, P-1 by Moody’s or A-1 by S&P;

 

(d)           investments in certificates of deposit, banker’s acceptances and
time deposits maturing within one year from the date of acquisition thereof
issued or guaranteed by or placed with, and money market deposit accounts issued
or offered by, (i) any domestic office of any commercial bank organized under
the laws of the United States of America or any State thereof that has a
combined capital and surplus and undivided profits of not less than $500,000,000
or (ii) any financial institution in a Participating Member State or
Switzerland, which financial institution has short term unsecured,
unsubordinated and unguaranteed debt instruments in issue having a rating of at
least F1 by Fitch, P-1 by Moody’s or A-1 by S&P; provided that with respect to
any Foreign Subsidiary whose country of organization or country where it
conducts its business operations is not a Participating Member State or
Switzerland, Permitted Investments shall also mean those investments that are
comparable to the investments set forth in this clause (d) in such Foreign
Subsidiary’s country of organization or country where it conducts business
operations;

 

(e)           fully collateralized repurchase agreements with a term of not more
than 30 days for securities described in clause (a) above and entered into with
a financial institution satisfying the criteria described in clause
(d)(ii) above; and

 

(f)            money market funds that (i) comply with the criteria set forth in
Securities and Exchange Commission Rule 2a-7 under the Investment Company Act of
1940, (ii) are rated at least AAA by S&P, Aaa by Moody’s or AAA by Fitch or
(iii) are rated as described in clause (ii) and invest solely in the assets
described in clauses (a) through (e) above.

 

“Permitted Liens” means Liens that any of the Borrowers and their respective
Subsidiaries are permitted to create, incur, assume or permit to exist pursuant
to Section 6.02.

 

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

 

“Plan” means any employee pension benefit plan (other than a Multiemployer Plan)
subject to the provisions of Title IV of ERISA or Section 412 of the Code or
Section 302 of ERISA, and in respect of which the Parent or any ERISA Affiliate
is (or, if such plan were terminated, would under Section 4069 of ERISA be
deemed to be) an “employer” as defined in Section 3(5) of ERISA.

 

“Prime Rate” means the rate of interest per annum publicly announced from time
to time by JPMorgan Chase Bank, N.A. as its prime rate in effect at its office
located at 383 Madison Avenue, New York, New York; each change in the Prime Rate
shall be effective from and including the date such change is publicly announced
as being effective.

 

“Recipient” means (a) any Agent, (b) any Lender and (c) any Issuing Lender, as
applicable.

 

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“Reference Bank” means the principal London office of J. P. Morgan Europe
Limited or such other banks as may be appointed by the Euro Administrative Agent
in consultation with the Parent.

 

“Register” has the meaning set forth in Section 10.04.

 

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

 

“Required Lenders” means, at any time, Lenders having Credit Exposures and
unused Commitments representing more than 50% of the sum of the total Credit
Exposures and unused Commitments at such time.

 

“Response” means (a) “response” as such term is defined in CERCLA, 42 U.S.C.
§9601(24), and (b) all other actions required by any Governmental Authority or
voluntarily undertaken to:  (i) clean up, remove, treat, abate, or in any other
way address any Hazardous Material in the environment; (ii) prevent the release
or threatened release of any Hazardous Material; or (iii) perform studies and
investigations in connection with, or as a precondition to, clause (i) or
(ii) above.

 

“Restricted Payment” means any dividend or other distribution (whether in cash,
securities or other property) with respect to any Equity Interests in any
Borrower or any of its Subsidiaries, or any payment (whether in cash, securities
or other property), including any sinking fund or similar deposit, on account of
the purchase, redemption, retirement, acquisition, cancellation or termination
of any such Equity Interests, or any option, warrant or other right to acquire
any such Equity Interests.

 

“S&P” means Standard & Poor’s Rating Services, a division of the McGraw Hill
Companies, Inc.

 

“Screen Rate” means, with respect to the EURIBOR, the percentage rate per annum
determined by the Euro Administrative Agent to be the current rate of the
Banking Federation of the European Union for the Reuters (Telerate) Screen -
Page 248.  In the event that such rate does not appear thereon (or otherwise on
such service), the “Screen Rate” for purposes of this definition shall be
determined by:  (i) reference to such other comparable publicly available
service for displaying EURIBOR rates as may be reasonably selected by the Euro
Administrative Agent or (ii) at its option, the rate at which Euros
approximately equal in principal amount to such Borrowing and for a maturity
equal to the applicable Interest Period are offered in immediately available
funds to the principal office of the Euro Administrative Agent in London,
England by leading banks in the European Market for Euros at approximately
11:00 a.m., Local Time, two (2) TARGET Days prior to the commencement of such
Interest Period.

 

“Security Agreements” means (i) those certain security and pledge agreements
executed in connection with the Prior Agreement, as ratified and amended in
connection with this Agreement, and identified on Schedule 1.01 to which certain
Subsidiaries of the Parent will become parties from time to time as provided in
Section 5.09 and (ii) that certain security and

 

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pledge agreement dated as of the Effective Date, between DYNAenergetics Canada
and the US Administrative Agent.

 

“Security Documents” means the Security Agreements, the Mortgages, each Joinder
Agreement, and each other security document or pledge agreement delivered in
accordance with applicable local or foreign Law to grant a valid, perfected
security interest in any property, and all UCC or other financing statements or
instruments of perfection required by this Agreement, any security agreement or
mortgage to be filed with respect to the security interests in property and
fixtures created pursuant to the Security Agreement or any mortgage and any
other document or instrument utilized to pledge as collateral for any of the
Obligations any property of whatever kind or nature, in each case, as the same
may be amended or modified from time to time.

 

“Statutory Reserve Rate” means a fraction (expressed as a decimal), the
numerator of which is the number one and the denominator of which is the number
one minus the aggregate of the maximum reserve percentages (including any
marginal, special, emergency or supplemental reserves) expressed as a decimal
established by the Board to which the Administrative Agent is subject for
eurocurrency funding (currently referred to as “Eurocurrency Liabilities” in
Regulation D of the Board).  Such reserve percentages shall include those
imposed pursuant to such Regulation D.  Eurodollar Loans shall be deemed to
constitute eurocurrency funding and to be subject to such reserve requirements
without benefit of or credit for proration, exemptions or offsets that may be
available from time to time to any Lender under such Regulation D or any
comparable regulation.  The Statutory Reserve Rate shall be adjusted
automatically on and as of the effective date of any change in any reserve
percentage.

 

“Subsidiary” means, with respect to any Person (the “parent”) at any date, any
corporation, limited liability company, partnership, association or other entity
the accounts of which would be consolidated with those of the parent in the
parent’s consolidated financial statements if such financial statements were
prepared in accordance with GAAP as of such date, as well as any other
corporation, limited liability company, partnership, association or other entity
(a) of which securities or other ownership interests representing more than 50%
of the equity or more than 50% of the ordinary voting power or, in the case of a
partnership, more than 50% of the general partnership interests are, as of such
date, owned, controlled or held, or (b) that is, as of such date, otherwise
Controlled, by the parent or one or more Subsidiaries of the parent or by the
parent and one or more Subsidiaries of the parent.

 

“Swap Agreement” means any agreement with respect to any swap, forward, future
or derivative transaction or option or similar agreement involving, or settled
by reference to, one or more rates, currencies, commodities, equity or debt
instruments or securities, or economic, financial or pricing indices or measures
of economic, financial or pricing risk or value or any similar transaction or
any combination of these transactions that is entered into in the ordinary
course of business for risk management purposes and not for speculative
purposes; provided that no phantom stock or similar plan providing for payments
only on account of services provided by current or former directors, officers,
employees or consultants of any Borrower or any of its respective Subsidiaries
shall be a Swap Agreement.

 

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“Swingline Loan” means a US Swingline Loan or a Euro Swingline Loan, as the
context may require.

 

“TARGET Day” means any day on which the Trans-European Automated Real-time Gross
Settlement Express Transfer payment system is open for the settlement of
payments in Euros.

 

“Taxes” means any and all present or future taxes, levies, imposts, duties,
deductions, or similar charges or withholdings imposed by any Governmental
Authority.

 

“Termination Date” means the fifth anniversary of the Effective Date.

 

“Transactions” means the execution, delivery and performance by the Borrowers of
this Agreement and the other Loan Documents, the borrowing of Loans, the use of
the proceeds thereof and the issuance of Letters of Credit hereunder.

 

“Type”, when used in reference to any Loan or Borrowing, refers to whether the
rate of interest on such Loan, or on the Loans comprising such Borrowing, is
determined by reference to the Adjusted LIBO Rate, the Alternate Base Rate, the
EURIBOR, the CDOR or the Canadian Prime Rate.

 

“Uniform Commercial Code” or “UCC” means the Uniform Commercial Code as in
effect from time to time in the State of New York or any other State the Laws of
which are required to be applied in connection with the issue or perfection of
security interests.

 

“US Administrative Agent” means JPMorgan Chase Bank, N.A. in its capacity as US
administrative agent for the Lenders hereunder.

 

“US Borrowers” means the Parent and the Wholly-Owned Subsidiaries of the Parent
that are Domestic Subsidiaries and that are identified as US Borrowers on the
signature pages hereto.

 

“US Borrowing” means a Borrowing comprised of one or more US Loans.

 

“US Commitment” means, with respect to each US Lender, the commitment of such
Lender to make US Loans and to acquire participations in US Letters of Credit
and US Swingline Loans hereunder, expressed as an amount representing the
maximum aggregate amount of such Lender’s US Credit Exposure hereunder, as such
commitment may be (a) reduced from time to time pursuant to Section 2.08 or
increased from time to time pursuant to Section 2.19 and (b) reduced or
increased from time to time pursuant to assignments by or to such Lender
pursuant to Section 2.18 or Section 10.04.  The initial amount of each such
Lender’s US Commitment is set forth on Schedule 2.01, or in the Assignment and
Assumption pursuant to which such Lender shall have assumed its US Commitment,
as applicable.  The initial aggregate amount of the Lenders’ US Commitments is
$36,000,000.

 

“US Credit Exposure” means, with respect to any Lender at any time, the sum of
the outstanding principal amount of such Lender’s US Loans and its US LC
Exposure and its US Swingline Exposure at such time.

 

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“US Guarantors” means each US Borrower and each of the Parent’s existing and
subsequently acquired or organized Wholly Owned Subsidiaries that are Domestic
Subsidiaries (other than any Domestic Subsidiary of any Foreign Subsidiary),
which US Guarantors guarantee certain Obligations under the Loan Documents
pursuant to either Section 9.01(a)(i) or Section 9.01(a)(ii).

 

“US Issuing Lender” means JPMorgan Chase Bank, N.A., in its capacity as the
issuer of US Letters of Credit hereunder and in its capacity as the issuer of
the Existing Letter of Credit, and its successors in such capacity as provided
in Section 2.05(i).  The US Issuing Lender may, in its discretion, arrange for
one or more US Letters of Credit to be issued by Affiliates of the US Issuing
Lender, in which case the term “Issuing Lender” shall include any such Affiliate
with respect to US Letters of Credit issued by such Affiliate.

 

“US LC Disbursement” means a payment made by the US Issuing Lender pursuant to a
US Letter of Credit.

 

“US LC Exposure” means, at any time, the sum of (a) the aggregate amount of all
US Letters of Credit at such time plus (b) the aggregate amount of all US LC
Disbursements that have not yet been reimbursed by the US Borrowers or converted
into a US Loan or a US Swingline Loan pursuant to Section 2.05(e) at such time. 
The US LC Exposure of any Lender at any time shall be its Applicable Percentage
of the total US LC Exposure at such time.

 

“US Lender” means a Lender with a US Commitment or, if the Commitments have
terminated or expired, a Lender with US Credit Exposure.

 

“US Letter of Credit” means any Letter of Credit denominated in US Dollars and
issued pursuant to Section 2.05 of this Agreement.

 

“US Loan” means a Loan made pursuant to Section 2.01(a).

 

“US Swingline Exposure” means, at any time, the aggregate principal amount of
all US Swingline Loans outstanding at such time.  The US Swingline Exposure of
any Lender at any time shall be its Applicable Percentage of the total US
Swingline Exposure at such time.

 

“US Swingline Lender” means JPMorgan Chase Bank, N.A., in its capacity as lender
of US Swingline Loans hereunder.

 

“US Swingline Loan” means a Loan made in Dollars pursuant to Section 2.04(a).

 

“Wholly Owned Subsidiary” means, with respect to any parent at any date, a
Subsidiary of which Equity Interests representing 100% of the equity or general
partnership interests, as applicable (other than director or nominal shares),
are, as of such date, owned, Controlled or held by such parent or one or more
Wholly Owned Subsidiaries of such parent or by such parent and one or more
Wholly Owned Subsidiaries of such parent.

 

“Withdrawal Liability” means liability to a Multiemployer Plan as a result of a
complete or partial withdrawal from such Multiemployer Plan, as such terms are
defined in Part I of Subtitle E of Title IV of ERISA.

 

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Section 1.02          Classification of Loans and Borrowings.  For purposes of
this Agreement, Loans may be classified and referred to by Class (e.g., a “US
Loan”) or by Type (e.g., a “Eurodollar Loan”) or by Class and Type (e.g., a “US
Eurodollar Loan”).  Borrowings also may be classified and referred to by
Class (e.g., a “US Borrowing”) or by Type (e.g., a “Eurodollar Borrowing”) or by
Class and Type (e.g., a “US Eurodollar Borrowing”).

 

Section 1.03          Terms Generally.  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 (a) any definition of or
reference to any agreement, instrument or other document herein shall be
construed as referring to such agreement, instrument or other document as from
time to time amended, supplemented, replaced or otherwise modified (subject to
any restrictions on such amendments, supplements, replacements or modifications
set forth herein), (b) any reference herein to any Person shall be construed to
include such Person’s successors and permitted assigns, (c) the words “herein”,
“hereof” and “hereunder”, and words of similar import, shall be construed to
refer to this Agreement in its entirety and not to any particular provision
hereof, (d) all references herein to Articles, Sections, Exhibits and Schedules
shall be construed to refer to Articles and Sections of, and Exhibits and
Schedules to, this Agreement, (e) any reference herein or in any other Loan
Document to a Loan Document shall include all appendices, exhibits and schedules
thereto and (f) 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.

 

Section 1.04          Accounting Terms; GAAP.  Except as otherwise expressly
provided herein, all terms of an accounting or financial nature shall be
construed in accordance with GAAP, as in effect from time to time; provided
that, if the Parent notifies the Administrative Agent that the Parent requests
an amendment to any provision hereof to eliminate the effect of any change
occurring after the Effective Date in GAAP or in the application thereof on the
operation of such provision (or if the Administrative Agent notifies the Parent
that the Required Lenders request an amendment to any provision hereof for such
purpose), regardless of whether any such notice is given before or after such
change in GAAP or in the application thereof, then such provision shall be
interpreted on the basis of GAAP as in effect and applied immediately before
such change shall have become effective until such notice shall have been
withdrawn or such provision amended in accordance herewith.  For purposes of
determining compliance with any provision of this Agreement, the determination
of whether a lease is to be treated as an operating lease or capital lease shall
be made without giving effect to any change in accounting for leases pursuant to
GAAP resulting from the implementation of proposes Accounting Standards Update
(ASU) Leases (Topic 840) issued August 17, 2010, or any successor proposal. 
Notwithstanding any other provision contained herein, all terms of an accounting
or financial nature used herein shall be construed, and all computations of
amounts and ratios referred to herein shall be made (i) without giving effect to
any election under Accounting Standards Codification 825-10-25 (or any other
Accounting Standards Codification or Financial Accounting Standard having a
similar result or effect) to value any Indebtedness or other liabilities of any
Borrower or any of its Subsidiaries at “fair value”, as defined therein and

 

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(ii) without giving effect to any treatment of Indebtedness in respect of
convertible debt instruments under Accounting Standards Codification 470-20 (or
any other Accounting Standards Codification or Financial Accounting Standard
having a similar result or effect) to value any such Indebtedness in a reduced
or bifurcated manner as described therein, and such Indebtedness shall at all
times be valued at the full stated principal amount thereof.

 

Section 1.05          Conversions.  The US Administrative Agent shall make all
conversions of currencies hereunder in accordance with its customary practices.

 

ARTICLE II

 

The Credits

 

Section 2.01          Commitments.  Subject to the terms and conditions set
forth herein:

 

(a)           Each US Lender agrees to make loans to the US Borrowers from time
to time during the Availability Period in an aggregate principal amount that
will not result in such Lender’s US Credit Exposure exceeding such Lender’s US
Commitment.  Within the foregoing limits and subject to the terms and conditions
set forth herein, the US Borrowers may borrow, prepay and reborrow US Loans.

 

(b)           Each Euro Lender agrees to make loans to the Euro Borrowers from
time to time during the Availability Period in an aggregate amount that will not
result in such Lender’s Euro Credit Exposure exceeding such Lender’s Euro
Commitment.  Within the foregoing limits and subject to the terms and conditions
set forth herein, the Euro Borrowers may borrow, prepay and reborrow Euro Loans.

 

(c)           Each Canadian Lender agrees to make loans to the Canadian
Borrowers from time to time during the Availability Period in an aggregate
amount that will not result in such Lender’s Canadian Credit Exposure exceeding
such Lender’s Canadian Commitment.  Within the foregoing limits and subject to
the terms and conditions set forth herein, the Canadian Borrowers may borrow,
prepay and reborrow Canadian Loans.

 

Section 2.02          Loans and Borrowings.

 

(a)           Each Loan of any Class (other than a Swingline Loan) shall be made
as part of a Borrowing consisting of Loans of such Class made by the appropriate
Lenders ratably in accordance with their respective Commitments of such Class. 
The failure of any Lender to make any Loan required to be made by it shall not
relieve any other Lender of its obligations hereunder; provided that the
Commitments of the Lenders are several and no Lender shall be responsible for
any other Lender’s failure to make Loans as required.

 

(b)           Subject to Section 2.12, (i) each Borrowing (other than a US
Swingline Loan) under the US Commitment shall be comprised entirely of ABR Loans
or Eurodollar Loans as the applicable US Borrower may request in accordance
herewith, (ii) each Borrowing (other than a Euro Swingline Loan) under the Euro
Commitment shall be comprised entirely of Eurocurrency Loans and (iii) each
Borrowing under the Canadian Commitment shall be comprised entirety of

 

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CDOR Loans or Canadian Prime Loans as the applicable Canadian Borrower may
request in accordance herewith.  Each Lender at its option may make any
Eurodollar Loan by causing any domestic or foreign branch or Affiliate of such
Lender to make such Loan; provided that any exercise of such option shall not
affect such Lender’s Commitment or the obligation of the US Borrowers to repay
such Loan in accordance with the terms of this Agreement.

 

(c)           At the commencement of each Interest Period for any Eurodollar
Borrowing, such Borrowing shall be in an aggregate amount that is an integral
multiple of $100,000 and not less than $500,000.  At the commencement of each
Interest Period for any Eurocurrency Borrowing, such Borrowing shall be in an
aggregate amount that is an integral multiple of €100,000 and not less than
€1,000,000; provided that a Eurocurrency Borrowing may be in an aggregate amount
that is equal to (i) the entire unused balance of the total Euro Commitments,
(ii) that which is required to repay a Euro Swingline Loan or (iii) that which
is required to finance the reimbursement of a Euro LC Disbursement as
contemplated by Section 2.05(c).  At the commencement of each Interest Period
for any CDOR Borrowing, such Borrowing shall be in an aggregate amount that is
an integral multiple of C$100,000 and not less than C$500,000.  At the time that
each ABR Borrowing is made, such Borrowing shall be in an aggregate amount that
is an integral multiple of $50,000 and not less than $100,000; provided that an
ABR Borrowing may be in an aggregate amount that is equal to (i) the entire
unused balance of the total US Commitments, (ii) that which is required to repay
a US Swingline Loan, or (iii) that which is required to finance the
reimbursement of a US LC Disbursement as contemplated by Section 2.05(e).  At
the time that each Canadian Prime Borrowing is made, such Borrowing shall be in
an aggregate amount that is an integral multiple of C$100,000 and not less than
C$500,000; provided that a Canadian Prime Borrowing may be in an aggregate
amount that is equal to (i) the entire unused balance of the Canadian
Commitments or (ii) that which is required to finance the reimbursement of a
Canadian LC Disbursement as contemplated by Section 2.05(e).  Borrowings of more
than one Type and Class may be outstanding at the same time; provided that there
shall not at any time be more than a total of (i) five (5) Eurodollar Borrowings
outstanding, (ii) five (5) Eurocurrency Borrowings outstanding or (iii) three
(3) CDOR Borrowings outstanding.

 

(d)           Notwithstanding any other provision of this Agreement, no Borrower
shall be entitled to request, or to elect to convert or continue, any Borrowing
if the Interest Period requested with respect thereto would end after the
Termination Date.

 

Section 2.03          Requests for Borrowings.  To request a Borrowing other
than a Swingline Loan, the applicable Borrower shall notify the Applicable Agent
(and the US Administrative Agent if it shall not be the Applicable Agent) of
such request (a) in the case of a Eurodollar Borrowing, by telephone or
electronic communication not later than 12:00 noon, Local Time, three
(3) Business Days before the date of the proposed Borrowing, (b) in the case of
an ABR Borrowing, by telephone or electronic communication not later than 12:00
noon, Local Time, one (1) Business Day before the date of the proposed
Borrowing, (c) in the case of a Eurocurrency Borrowing, by facsimile or
electronic communication not later than 11:00 a.m., Local Time, three
(3) Business Days before the date of the proposed Borrowing, (d) in the case of
a CDOR Borrowing, by facsimile or electronic communication not later than 12:00
noon, Local Time, three (3) Business Days before the date of the proposed
Borrowing and (e) in the case of a Canadian Prime Borrowing, by facsimile or
electronic communication not later than 12:00 noon, Local Time, one (1) Business
Day before the date of the proposed Borrowing;

 

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provided that (i) any such notice of an ABR Borrowing to finance the
reimbursement of a US LC Disbursement as contemplated by Section 2.05(e) may be
given not later than 12:00 noon, Local Time, on the date of the proposed
Borrowing and (ii) any such notice of a Canadian Prime Borrowing to finance the
reimbursement of a Canadian LC Disbursement as contemplated by
Section 2.05(e) may be given not later than 12:00 noon, Local Time, on the date
of the proposed Borrowing.  Each Borrowing Request shall be irrevocable and, if
delivered by telephone, shall be confirmed promptly by facsimile transmission or
electronic communication to the Applicable Agent of a written Borrowing Request
in a form approved by the Applicable Agent and signed by the applicable
Borrower.  Each telephonic and written Borrowing Request shall specify the
following information in compliance with Section 2.02:

 

(i)            the Borrower requesting such Borrowing;

 

(ii)           the aggregate amount of the requested Borrowing;

 

(iii)          the date of such Borrowing, which shall be a Business Day;

 

(iv)          the Class and Type of such Borrowing;

 

(v)           in the case of a Eurodollar Borrowing, a Eurocurrency Borrowing or
a CDOR Borrowing, the initial Interest Period to be applicable thereto, which
shall be a period contemplated by the definition of the term “Interest Period”;
and

 

(vi)          the location and number of the account to which funds are to be
disbursed, which shall comply with the requirements of Section 2.06.

 

If no election as to the Type of Borrowing is specified, (i) with respect to
Borrowings under the US Commitments, then the requested Borrowing shall be an
ABR Borrowing and (ii) with respect to Borrowings under the Canadian Commitment,
then the requested Borrowing shall be a Canadian Prime Borrowing.  If no
Interest Period is specified with respect to any requested Eurodollar Borrowing,
Eurocurrency Borrowing or CDOR Borrowing, then the applicable Borrower shall be
deemed to have selected an Interest Period of one month’s duration.  Promptly
following receipt of a Borrowing Request in accordance with this Section, the
Applicable Agent shall advise each Lender having a Commitment of the Class of
the requested Borrowing of the details such Borrowing Request and of the amount
of such Lender’s Loan to be made as part of the requested Borrowing.

 

Section 2.04          Swingline Loans.

 

(a)           Subject to the terms and conditions set forth herein, (i) the US
Swingline Lender agrees to make US Swingline Loans to the US Borrowers from time
to time during the Availability Period in an aggregate principal amount at any
time outstanding that will not result in (A) the aggregate principal amount of
outstanding US Swingline Loans exceeding $5,000,000 or (B) the total US Credit
Exposures exceeding the total US Commitments and (ii) the Euro Swingline Lender
agrees to make Euro Swingline Loans to the Euro Borrowers from time to time
during the Availability Period in an aggregate principal amount that will not
result in (A) the aggregate principal amount of outstanding Euro Swingline Loans
exceeding €5,000,000 and (B) the total Euro Credit Exposures exceeding the total
Euro Commitments; provided that

 

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(x) no Swingline Lender shall be required to make a Swingline Loan to refinance
an outstanding Swingline Loan and (y) for purposes of this Section 2.04 only,
the terms “Euro Borrower” and “Euro Borrowers” shall not include the Parent. 
Within the foregoing limits and subject to the terms and conditions set forth
herein, the US Borrowers and Euro Borrowers, as applicable, may borrow, prepay
and reborrow Swingline Loans.  Each US Swingline Loan shall be in an amount that
is an integral multiple of $1 and not less than $25,000 and each Euro Swingline
Loan shall be in an amount that is not less than €250,000.

 

(b)           To request a US Swingline Loan, a US Borrower shall notify the US
Administrative Agent of such request by telephone (confirmed by facsimile or
electronic communication) not later than 12:00 noon, Local Time, on the day of a
proposed US Swingline Loan.  To request a Euro Swingline Loan, a Euro Borrower
shall notify the Euro Administrative Agent of such request by facsimile or
electronic communication not later than 9:00 a.m., Local Time, on the day of a
proposed Euro Swingline Loan.  Each such notice shall be irrevocable and shall
specify the requested date (which shall be a Business Day) and amount of the
requested Swingline Loan.  Such Agent will promptly advise the applicable
Swingline Lender of any such notice received from a Borrower.  The applicable
Swingline Lender shall make each Swingline Loan to be made by it available to
the applicable Borrower by means of a credit to the deposit account of such
Borrower designated by such Borrower in writing in its request for such
Swingline Loan or its confirmation of its request for such Swingline Loan, as
applicable (or, in the case of a Swingline Loan made to finance the
reimbursement of an LC Disbursement as provided in Section 2.05(e), by
remittance to the appropriate Issuing Lender) by 3:00 p.m., Local Time, on the
requested date of such Swingline Loan.

 

(c)           The US Swingline Lender may by written notice given to the US
Administrative Agent not later than 11:00 a.m., Local Time, on any Business Day
require the US Lenders to acquire participations on such Business Day in all or
a portion of the US Swingline Loans outstanding.  The Euro Swingline Lender may
by written notice given to the Euro Administrative Agent not later than
11:00 a.m., Local Time, on any Business Day require the Euro Lenders to acquire
participations on such Business Day in all or a portion of the Euro Swingline
Loans outstanding.  Each such notice shall specify the aggregate amount of
Swingline Loans in which the applicable Lenders will participate.  Promptly upon
receipt of such notice, (i) with respect to US Swingline Loans, the US
Administrative Agent will give notice thereof to each US Lender, specifying in
such notice such Lender’s Applicable Percentage of such Swingline Loan or Loans
and (ii) with respect to Euro Swingline Loans, the Euro Administrative Agent
will give notice thereof to each Euro Lender specifying in such notice such
Lender’s Applicable Percentage of such Swingline Loan or Loans.  Each US Lender
and each Euro Lender hereby absolutely and unconditionally agrees, upon receipt
of notice as provided above, to pay to the US Administrative Agent or the Euro
Administrative Agent, as applicable, for the account of the relevant Swingline
Lender, such Lender’s Applicable Percentage of such Swingline Loan or Loans. 
Each US Lender and Euro Lender acknowledges and agrees that its obligation to
acquire participations in Swingline Loans pursuant to this paragraph is absolute
and unconditional and shall not be affected by any circumstance whatsoever,
including the occurrence and continuance of a Default or an Event of Default or
reduction or termination of the Commitments, and that each such payment shall be
made without any offset, abatement, withholding or reduction whatsoever.  Each
US Lender and Euro Lender shall comply with its obligation under this paragraph
by wire transfer of immediately available funds, in the same manner as provided
in

 

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Section 2.06 with respect to Loans made by such Lender (and Section 2.06 shall
apply, mutatis mutandis, to the payment obligations of such Lender), and the US
Administrative Agent or the Euro Administrative Agent, as applicable, shall
promptly pay to the relevant Swingline Lender the amounts so received by it from
such Lenders.  The US Administrative Agent or the Euro Administrative Agent, as
applicable, shall notify the US Borrowers or the Euro Borrowers, as applicable,
of any participations in any Swingline Loan acquired pursuant to this paragraph,
and thereafter payments in respect of such Swingline Loan shall be made to the
US Administrative Agent or the Euro Administrative Agent, as applicable, and not
to the relevant Swingline Lender.  Any amounts received by a Swingline Lender
from a Borrower (or other party on behalf of a Borrower) in respect of a
Swingline Loan after receipt by such Swingline Lender of the proceeds of a sale
of participations therein shall be promptly remitted to the US Administrative
Agent or the Euro Administrative Agent, as applicable; any such amounts received
by such Agent shall be promptly remitted by such Agent to the Lenders that shall
have made their payments pursuant to this paragraph and to the relevant
Swingline Lender, as their interests may appear; provided that any such payment
so remitted shall be repaid by a Swingline Lender or such Agent, as applicable,
if and to the extent such payment is required to be refunded to a Borrower for
any reason.  The purchase of participations in a Swingline Loan pursuant to this
paragraph shall not relieve the US Borrowers or the Euro Borrowers of any
default in the payment thereof.

 

Section 2.05           Letters of Credit.

 

(a)           General.  Subject to the terms and conditions set forth herein, at
any time during the Availability Period, (i) any US Borrower may request the
issuance of, and the US Issuing Lender shall issue, US Letters of Credit for the
account of such US Borrower or the account of any of its Subsidiaries, in a form
reasonably acceptable to the US Administrative Agent and the US Issuing Lender,
(ii) any Euro Borrower may request the issuance of, and the Euro Issuing Lender
shall issue, Euro Letters of Credit for the account of such Euro Borrower or the
account of any of its Subsidiaries, in a form reasonably acceptable to the Euro
Administrative Agent and the Euro Issuing Lender and (iii) any Canadian Borrower
may request the issuance of, and the Canadian Issuing Lender shall issue,
Canadian Letters of Credit for the account of such Canadian Borrower or the
account of any of its Subsidiaries, in a form reasonably acceptable to the
Canadian Administrative Agent and the Canadian Issuing Lender.  In the event of
any inconsistency between the terms and conditions of this Agreement and the
terms and conditions of any form of letter of credit application or other
agreement submitted by any Borrower to, or entered into by any Borrower with,
any Issuing Lender relating to any Letter of Credit, the terms and conditions of
this Agreement shall control.

 

(b)           Notice of Issuance, Amendment, Renewal, Extension; Certain
Conditions.  To request the issuance of a Letter of Credit (or the amendment,
renewal or extension of an outstanding Letter of Credit), the applicable
Borrower shall transmit by facsimile or by electronic communication to the
Applicable Issuing Lender and the Applicable Agent (reasonably in advance of the
requested date of issuance, amendment, renewal or extension) a notice requesting
the issuance of a Letter of Credit, or identifying the Letter of Credit to be
amended, renewed or extended, and specifying the date of issuance, amendment,
renewal or extension (which shall be a Business Day), the date on which such
Letter of Credit is to expire (which shall comply with paragraph (c) of this
Section), the amount of such Letter of Credit, the name and address of the
beneficiary thereof and such other information as shall be necessary to prepare,
amend, renew or

 

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extend such Letter of Credit.  If requested by such Issuing Lender, such
Borrower also shall submit a letter of credit application on such Issuing
Lender’s standard form in connection with any request for a Letter of Credit.  A
Letter of Credit shall be issued, amended, renewed or extended only if (and upon
issuance, amendment, renewal or extension of each Letter of Credit the Borrower
to which such Letter of Credit shall be issued shall be deemed to represent and
warrant that), after giving effect to such issuance, amendment, renewal or
extension (i) in the case of a US Letter of Credit, the US LC Exposure shall not
exceed $15,000,000 and the total US Credit Exposures shall not exceed the total
US Commitments, (ii) in the case of a Euro Letter of Credit, the Euro LC
Exposure shall not exceed €7,000,000 and the total Euro Credit Exposures shall
not exceed the total Euro Commitments and (iii) in the case of a Canadian Letter
of Credit, the Canadian LC Exposure shall not exceed C$500,000 and the total
Canadian Credit Exposures shall not exceed the total Canadian Commitments.

 

(c)           Expiration Date.  Each Letter of Credit shall expire at or prior
to 5:00 p.m., Local Time, on the earlier of (i) the date one year after the date
of the issuance of such Letter of Credit (or, in the case of any renewal or
extension thereof, one year after such renewal or extension) and (ii) the date
that is five (5) Business Days prior to the Termination Date; provided, however,
that any Letter of Credit with a one-year tenor may provide for the renewal
thereof for additional one-year periods (which shall in no event extend beyond
the date referred to in clause (ii) above).

 

(d)           Participations.  By the issuance of a Letter of Credit (or an
amendment to a Letter of Credit increasing the amount thereof) and without any
further action on the part of any Issuing Lender or the Lenders, (i) the US
Issuing Lender hereby grants to each US Lender, and each such Lender hereby
acquires from the US Issuing Lender, a participation in such US Letter of Credit
equal to such Lender’s Applicable Percentage of the aggregate amount available
to be drawn under such Letter of Credit, (ii) the Euro Issuing Lender hereby
grants to each Euro Lender, and each such Lender hereby acquires from the Euro
Issuing Lender, a participation in such Euro Letter of Credit equal to such
Lender’s Applicable Percentage of the aggregate amount available to be drawn
under such Letter of Credit and (iii) the Canadian Issuing Lender hereby grants
to each Canadian Lender, and each such Lender hereby acquires from the Canadian
Issuing Lender, a participation in such Canadian Letter of Credit equal to such
Lender’s Applicable Percentage of the aggregate amount available to be drawn
under such Letter of Credit.  In consideration and in furtherance of the
foregoing, each Lender hereby absolutely and unconditionally agrees to pay to
the Applicable Agent, for the account of the Applicable Issuing Lender, such
Lender’s Applicable Percentage of each LC Disbursement made by such Issuing
Lender and not reimbursed by the relevant Borrower on the date due as provided
in paragraph (e) of this Section, or of any reimbursement payment required to be
refunded to such Borrower for any reason.  Each Lender acknowledges and agrees
that its obligation to acquire participations pursuant to this paragraph in
respect of Letters of Credit is absolute and unconditional and shall not be
affected by any circumstance whatsoever, including any amendment, renewal or
extension of any Letter of Credit or the occurrence and continuance of a Default
or an Event of Default or reduction or termination of the Commitments, and that
each such payment shall be made without any offset, abatement, withholding or
reduction whatsoever.

 

(e)           Reimbursement.  If an Issuing Lender shall make any LC
Disbursement in respect of a Letter of Credit for a Borrower’s own account or
the account of any of its Subsidiaries, such Borrower shall reimburse such LC
Disbursement by paying to the Applicable Agent an amount

 

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equal to such LC Disbursement not later than 1:00 p.m., Local Time, on the date
that such LC Disbursement is made, if such Borrower shall have received notice
of such LC Disbursement prior to 11:00 a.m., Local Time, on such date, or, if
such notice has not been received by such Borrower prior to such time on such
date, then not later than 1:00 p.m., Local Time, on the Business Day immediately
following the day that such Borrower receives such notice; provided that (i) in
the case of a US LC Disbursement, if such LC Disbursement is not less than
$1,000,000, the applicable US Borrower may, subject to the conditions to
borrowing set forth herein, request, in accordance with Section 2.03 or
Section 2.04, that such payment be financed with an ABR Borrowing or US
Swingline Loan in an equivalent amount and, to the extent so financed, such US
Borrower’s obligation to make such payment shall be discharged and replaced by
the resulting ABR Borrowing or US Swingline Loan, (ii) in the case of a Euro LC
Disbursement, if such LC Disbursement is not less than €250,000, the applicable
Euro Borrower may, subject to the conditions to borrowing set forth herein,
request, in accordance with Section 2.03 or Section 2.04, that such payment be
financed with a Eurocurrency Borrowing or a Euro Swingline Loan in an equivalent
amount and, to the extent so financed, such Euro Borrower’s obligation to make
such payment shall be discharged and replaced by the resulting Eurocurrency
Borrowing or Euro Swingline Loan and (iii) in the case of a Canadian LC
Disbursement, if such LC Disbursement is not less that C$50,000, the applicable
Canadian Borrower may, subject to the conditions to Borrowing set forth herein,
request, in accordance with Section 2.03, that such payment be financed with a
Canadian Prime Loan in an equivalent amount and, to the extent so financed, such
Canadian Borrower’s obligation to make such payment shall be discharged and
replaced by the resulting Canadian Prime Loan.  If such Borrower fails to make
such payment when due, the Applicable Agent shall notify each appropriate Lender
of the applicable LC Disbursement, the payment then due from such Borrower in
respect thereof and such Lender’s Applicable Percentage thereof.  Promptly
following receipt of such notice, each such Lender shall pay to the Applicable
Agent its Applicable Percentage of the payment then due from such Borrower, in
the same manner as provided in Section 2.06 with respect to Loans made by such
Lender (and Section 2.06 shall apply, mutatis mutandis, to the payment
obligations of such Lender), and the Applicable Agent shall promptly pay to the
Applicable Issuing Lender the amounts so received by it from such Lenders. 
Promptly following receipt by the Applicable Agent of any payment from a
Borrower pursuant to this paragraph, the Applicable Agent shall distribute such
payment to the Applicable Issuing Lender or, to the extent that the Lenders have
made payments pursuant to this paragraph to reimburse the Applicable Issuing
Lender, then to such Lenders and the Applicable Issuing Lender as their
interests may appear.  Any payment made by a Lender pursuant to this paragraph
to reimburse an Issuing Lender for any LC Disbursement (other than the funding
of an ABR Loan, a Swingline Loan or a Canadian Prime Rate Loan, as contemplated
above) shall not constitute a Loan and shall not relieve such Borrower of its
obligation to reimburse such LC Disbursement.

 

(f)            Obligations Absolute.  Each Borrower’s obligation to reimburse LC
Disbursements as provided in paragraph (e) of this Section shall be absolute,
unconditional and irrevocable, and shall be performed strictly in accordance
with the terms of this Agreement under any and all circumstances whatsoever and
irrespective of (i) any lack of validity or enforceability of any Letter of
Credit or this Agreement, or any term or provision therein, (ii) any draft or
other document presented under a Letter of Credit proving to be forged,
fraudulent or invalid in any respect or any statement therein being untrue or
inaccurate in any respect, (iii) payment by the Issuing Lender under a Letter of
Credit against presentation of a draft or other document that

 

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does not comply with the terms of such Letter of Credit, or (iv) any other event
or circumstance whatsoever, whether or not similar to any of the foregoing, that
might, but for the provisions of this Section, constitute a legal or equitable
discharge of, or provide a right of setoff against, the Borrowers’ Obligations
hereunder.  Neither the Agents, the Lenders nor the Issuing Lenders, nor any of
their Related Parties, shall have any liability or responsibility by reason of
or in connection with the issuance or transfer of any Letter of Credit or any
payment or failure to make any payment thereunder (irrespective of any of the
circumstances referred to in the preceding sentence), or any error, omission,
interruption, loss or delay in transmission or delivery of any draft, notice or
other communication under or relating to any Letter of Credit (including any
document required to make a drawing thereunder), any error in interpretation of
technical terms or any consequence arising from causes beyond the control of the
Applicable Issuing Lender; provided that the foregoing shall not be construed to
excuse any Issuing Lender from liability to any Borrower to the extent of any
direct damages (as opposed to consequential damages, claims in respect of which
are hereby waived by the Borrowers to the extent permitted by applicable Law)
suffered by such Borrower that are caused by the Applicable Issuing Lender’s
failure to exercise care when determining whether drafts and other documents
presented under a Letter of Credit comply with the terms thereof.  The parties
hereto expressly agree that, in the absence of gross negligence or willful
misconduct on the part of an Issuing Lender (as finally determined by a court of
competent jurisdiction), each Issuing Lender shall be deemed to have exercised
care in each such determination.  In furtherance of the foregoing and without
limiting the generality thereof, the parties agree that, with respect to
documents presented which appear on their face to be in substantial compliance
with the terms of a Letter of Credit, each Issuing Lender may, in its sole
discretion, either accept and make payment upon such documents without
responsibility for further investigation, regardless of any notice or
information to the contrary, or refuse to accept and make payment upon such
documents if such documents are not in strict compliance with the terms of such
Letter of Credit.

 

(g)           Disbursement Procedures.  Each Issuing Lender shall, promptly
following its receipt thereof, examine all documents purporting to represent a
demand for payment under a Letter of Credit.  The Applicable Issuing Lender
shall promptly notify the Applicable Agent and the relevant Borrower by
telephone (confirmed by facsimile or electronic communication) in the case of
the US Issuing Lender or by facsimile or electronic communication in the case of
the Euro Issuing Lender or the Canadian Issuing Lender, in each case, of such
demand for payment and whether the Applicable Issuing Lender has made or will
make an LC Disbursement thereunder; provided that any failure to give or delay
in giving such notice shall not relieve such Borrower of its obligation to
reimburse the Applicable Issuing Lender and the relevant Lenders with respect to
any such LC Disbursement.

 

(h)           Interim Interest.  If an Issuing Lender shall make any LC
Disbursement, then, unless the relevant Borrower shall reimburse such LC
Disbursement in full on the date such LC Disbursement is made, the unpaid amount
thereof shall bear interest, for each day from and including the date such LC
Disbursement is made to but excluding the date that such Borrower reimburses
such LC Disbursement, (i) in the case of a US LC Disbursement, at the rate per
annum then applicable to ABR Loans, (ii) the case of a Euro LC Disbursement, at
the rate per annum then applicable to Euro Swingline Loans and (iii) in the case
of a Canadian LC Disbursement, at the rate per annum then applicable to Canadian
Prime Loans; provided that, if the relevant Borrower fails to reimburse such LC
Disbursement when due pursuant to paragraph

 

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(e) of this Section, then Section 2.12(g) shall apply.  Interest accrued
pursuant to this paragraph shall be for the account of the Applicable Issuing
Lender, except that interest accrued on and after the date of payment by any
Lender pursuant to paragraph (e) of this Section to reimburse the Applicable
Issuing Lender shall be for the account of such Lender to the extent of such
payment.

 

(i)            Replacement of an Issuing Lender.  Any Issuing Lender may be
replaced at any time by written agreement among the Parent, the US
Administrative Agent, the replaced Issuing Lender and the successor Issuing
Lender (unless such replaced Issuing Lender is then a Defaulting Lender in which
case the replaced Issuing Lender’s consent is not necessary).  The US
Administrative Agent shall notify the Lenders of any such replacement of an
Issuing Lender.  At the time any such replacement shall become effective, the
Parent shall pay all unpaid fees accrued for the account of the replaced Issuing
Lender pursuant to Section 2.11(b).  From and after the effective date of any
such replacement, (i) the successor Issuing Lender shall have all the rights and
obligations of the Issuing Lender under this Agreement with respect to Letters
of Credit to be issued thereafter and (ii) references herein to the term
“Issuing Lender” shall be deemed to refer to such successor or to any previous
Issuing Lender, or to such successor and all previous Issuing Lenders, as the
context shall require.  After the replacement of an Issuing Lender hereunder,
the replaced Issuing Lender shall remain a party hereto and shall continue to
have all the rights and obligations of an Issuing Lender under this Agreement
with respect to Letters of Credit issued by it prior to such replacement, but
shall not be required to issue additional Letters of Credit.

 

(j)            Cash Collateralization.  If any Event of Default shall occur and
be continuing, on the Business Day that the Parent receives notice from the US
Administrative Agent or the Required Lenders (or, if the maturity of the Loans
has been accelerated, the Lenders with LC Exposure representing greater than 50%
of the total LC Exposure demanding the deposit of cash collateral pursuant to
this paragraph), (i) the US Borrowers shall deposit in an account with the US
Administrative Agent, in the name of the US Administrative Agent and for the
benefit of the Lenders, an amount in cash in Dollars equal to the total US LC
Exposure as of such date plus any accrued and unpaid interest thereon minus the
amount on deposit in such account that has not been applied against the
Obligations, (ii) the Euro Borrowers shall deposit in an account with the Euro
Administrative Agent, in the name of the Euro Administrative Agent and for the
benefit of the Lenders, an amount in cash in Euros equal to the total Euro LC
Exposure as of such date plus any accrued and unpaid interest thereon minus the
amount on deposit in such account that has not been applied against the
Obligations and (iii) the Canadian Borrowers shall deposit in an account with
the Canadian Administrative Agent, in the name of the Canadian Administrative
Agent and for the benefit of the Lenders, an amount in cash in Canadian Dollars
equal to the total Canadian LC Exposure as of such date plus any accrued and
unpaid interest thereon minus the amount on deposit in such account that has not
been applied against the Obligations; provided that the obligation to deposit
such cash collateral shall become effective immediately, and such deposit shall
become immediately due and payable, without demand or other notice of any kind,
upon the occurrence of any Event of Default with respect to any Borrower
described in clause (h) or (i) of Section 7.01.  Each such deposit shall be held
by the Applicable Agent as collateral for the payment and performance of the
Obligations.  The Applicable Agent shall have exclusive dominion and control,
including the exclusive right of withdrawal, over such accounts.  Other than any
interest earned on the investment of such deposits, which investments shall be

 

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made at the option and discretion of the Applicable Agent (but, if so made,
shall be limited to overnight bank loans or other investments denominated in the
applicable currency generally comparable to those described in
clauses (a) through (f) of Permitted Investments) and at the Borrowers’ risk and
expense, such deposits shall not bear interest.  Interest or profits, if any, on
such investments shall accumulate in such account.  Moneys in such account shall
be applied by the Applicable Agent to reimburse the Applicable Issuing Lender
for LC Disbursements for which it has not been reimbursed and, to the extent not
so applied, shall be held for the satisfaction of the reimbursement obligations
of the Borrowers for the LC Exposure at such time or, subject to the consent of
Lenders with LC Exposure representing greater than 50% of the total LC Exposure,
be applied to satisfy other obligations of the Borrowers under this Agreement. 
If the Borrowers are required to provide an amount of cash collateral hereunder,
such amount (to the extent not applied as aforesaid) shall be returned to the
Borrowers within three Business Days after all Events of Default have been cured
or waived.

 

(k)           Existing Letter of Credit.  The Existing Letter of Credit shall be
a Letter of Credit for all purposes hereunder.

 

Section 2.06           Funding of Borrowings.

 

(a)           Each Lender shall make each Loan to be made by it hereunder on the
proposed date thereof by wire transfer of immediately available funds in the
same currency as such Loan, to the account of the Applicable Agent most recently
designated by it for such purpose by notice to each such Lender not later than
(i) 1:00 p.m., Local Time, in the case of US Loans, (ii) 12:00 noon, Local Time,
in the case of Euro Loans, and (iii) 2:00 p.m., Local Time, in the case of
Canadian Loans; provided that all Swingline Loans shall be made as provided in
Section 2.04(a).  The Applicable Agent will make such Loans available to the
applicable Borrower by promptly crediting the amounts so received, in like
funds, to such account or accounts of the applicable Borrower designated by such
Borrower in the applicable Borrowing Request; provided that (i) ABR Loans made
to finance the reimbursement of a US LC Disbursement as provided in
Section 2.05(e) shall be remitted by the US Administrative Agent to the US
Issuing Lender, (ii) Euro Swingline Loans made to finance the reimbursement of a
Euro LC Disbursement as provided in Section 2.05(e) shall be remitted by the
Euro Administrative Agent to the Euro Issuing Lender and (iii) Canadian Prime
Loans made to finance the reimbursement of a Canadian LC Disbursement as
provided in Section 2.05(e) shall be remitted by the Canadian Administrative
Agent to the Canadian Issuing Lender.

 

(b)           Unless the Applicable Agent shall have received notice from a
Lender prior to the proposed date of any Borrowing that such Lender will not
make available to the Applicable Agent such Lender’s share of such Borrowing,
the Applicable Agent may assume that such Lender has made such share available
on such date in accordance with paragraph (a) of this Section and may, in
reliance upon such assumption, make available to the applicable Borrower a
corresponding amount.  In such event, if a Lender has not in fact made its share
of the applicable Borrowing available to the Applicable Agent, then such Lender
and the applicable Borrower severally agree to pay to the Applicable Agent
forthwith on demand such corresponding amount with interest thereon, for each
day from and including the date such amount is made available to such Borrower
to but excluding the date of payment to the Applicable Agent at (i) in the case
of a US Lender, the greater of the Federal Funds Effective Rate and a rate
determined by the US

 

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Administrative Agent in accordance with banking industry rules on interbank
compensation, (ii) in the case of a US Borrower, the interest rate applicable to
ABR Loans, (iii) in the case of a Euro Lender, the Eurocurrency Rate, (iv) in
the case of a Euro Borrower, the interest rate applicable to Eurodollar Loans,
(v) in the case of a Canadian Lender, a rate determined by the Canadian
Administrative Agent in accordance with banking industry rules on interbank
compensation and (vi) in the case of a Canadian Borrower, the interest rate
applicable to Canadian Prime Loans.  If such Lender pays such amount to the
Applicable Agent, then such amount shall constitute such Lender’s Loan included
in such Borrowing.

 

Section 2.07           Interest Elections.

 

(a)           Each Borrowing initially shall be of the Type specified in the
applicable Borrowing Request and, in the case of a Eurodollar Borrowing, a
Eurocurrency Borrowing and a CDOR Borrowing, shall have an initial Interest
Period as specified in such Borrowing Request.  Thereafter, (i) with respect to
Borrowings under the US Commitment, a US Borrower may elect to convert such
Borrowing to a different Type or to continue such Borrowing and, in the case of
a Eurodollar Borrowing, may elect Interest Periods therefor, (ii) with respect
to a Eurocurrency Borrowing, a Euro Borrower may elect Interest Periods therefor
and (iii) with respect to a Borrowings under the Canadian Commitment, a Canadian
Borrower may elect to convert such Borrowing to a different Type or to continue
such Borrowing and, in the case of a CDOR Borrowing, may elect Interest Periods
therefor, in each case, as provided in this Section.  Each Borrower may elect
different options with respect to different portions of its affected Borrowing,
in which case each such portion shall be allocated ratably among the Lenders
holding the Loans comprising such Borrowing, and the Loans comprising each such
portion shall be considered a separate Borrowing.  This Section shall not apply
to Swingline Loans, which may not be converted or continued.

 

(b)           To make an election pursuant to this Section, the applicable
Borrower shall notify the Applicable Agent of such election in the manner and by
the time that a Borrowing Request would be required to be delivered under
Section 2.03 if such Borrower were requesting a Borrowing of the Type resulting
from such election to be made on the effective date of such election.  Each
Interest Election Request shall be irrevocable and, if delivered by telephone,
shall be confirmed promptly by facsimile transmission or electronic
communication to the Applicable Agent of a written Interest Election Request in
a form approved by the Applicable Agent and signed by the applicable Borrower.

 

(c)           Each telephonic and written Interest Election Request shall
specify the following information in compliance with Section 2.02:

 

(i)            the Borrowing to which such Interest Election Request applies
and, if different options are being elected with respect to different portions
thereof, the portions thereof to be allocated to each resulting Borrowing (in
which case the information to be specified pursuant to clauses (iii) and
(iv) below shall be specified for each resulting Borrowing);

 

(ii)           the effective date of the election made pursuant to such Interest
Election Request, which shall be a Business Day;

 

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(iii)          whether the resulting Borrowing is to be an ABR Borrowing, a
Eurodollar Borrowing, a Eurocurrency Borrowing, a Canadian Prime Borrowing or a
CDOR Borrowing; and

 

(iv)          if the resulting Borrowing is a Eurodollar Borrowing, a
Eurocurrency Borrowing or a CDOR Borrowing, the Interest Period to be applicable
thereto after giving effect to such election, which shall be a period
contemplated by the definition of the term “Interest Period”.

 

If any such Interest Election Request requests a Eurodollar Borrowing, a
Eurocurrency Borrowing or a CDOR Borrowing but does not specify an Interest
Period, then the applicable Borrower shall be deemed to have selected an
Interest Period of one month’s duration.

 

(d)           Promptly following receipt of an Interest Election Request, the
Applicable Agent shall advise each affected Lender of the details thereof and of
such Lender’s portion of each resulting Borrowing.

 

(e)           If the relevant Borrower fails to deliver a timely Interest
Election Request with respect to a Eurodollar Borrowing, a Eurocurrency
Borrowing or a CDOR Borrowing prior to the end of the Interest Period applicable
thereto, then, unless such Borrowing is repaid as provided herein, at the end of
such Interest Period such Borrowing shall be converted to (i) an ABR Borrowing
in the case of a Eurodollar Borrowing, (ii) a Eurocurrency Borrowing with an
Interest Period of one month’s duration in the case of a Eurocurrency Borrowing
and (iii) a Canadian Prime Borrowing in the case of a CDOR Borrowing. 
Notwithstanding any contrary provision hereof, if an Event of Default has
occurred and is continuing and the US Administrative Agent, at the request of
the Required Lenders, so notifies the Parent, then, so long as an Event of
Default is continuing (i) no outstanding Borrowing may be converted to or
continued as a Eurodollar Borrowing and (ii) unless repaid, each Eurodollar
Borrowing shall be converted to an ABR Borrowing at the end of the Interest
Period applicable thereto, (iii) no outstanding Canadian Borrowing may be
converted or continued as a CDOR Borrowing and (iv) unless repaid, each CDOR
Borrowing shall be converted as a Canadian Prime Borrowing at the end of the
Interest Period applicable thereto.

 

Section 2.08           Termination and Reduction of Commitments.

 

(a)           Unless previously terminated, the Commitments shall terminate on
the Termination Date.

 

(b)           The Parent may at any time terminate or from time to time reduce
the Commitments of any Class; provided that (i) each reduction of the US
Commitments shall be in an amount that is an integral multiple of $1,000,000 and
not less than $5,000,000 and the Parent shall not terminate or reduce the US
Commitments if, after giving effect to any concurrent prepayment of the Loans in
accordance with Section 2.10, the total US Credit Exposures would exceed the
total US Commitments, (ii) each reduction of the Euro Commitments shall be in an
amount that is an integral multiple of €1,000,000 and not less than €2,000,000
and the Parent shall not terminate or reduce the Euro Commitments if, after
giving effect to any concurrent prepayment of Loans in accordance with
Section 2.10, the total Euro Credit Exposures would exceed the total Euro
Commitments and (iii) each reduction of the Canadian Commitments shall

 

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be in an amount that is an integral multiple of C$100,000 and not less than
C$100,000 and the Parent shall not terminate or reduce the Canadian Commitments
if, after giving effect to any concurrent prepayment of Loans in accordance with
Section 2.10, the total Canadian Credit Exposures would exceed the total
Canadian Commitments.

 

(c)           The Parent shall notify the US Administrative Agent of any
election to terminate or reduce the Commitments of any Class under paragraph
(b) of this Section at least three Business Days prior to the effective date of
such termination or reduction, specifying such election and the effective date
thereof.  Promptly following receipt of any notice, the US Administrative Agent
shall advise the Applicable Agent if the US Administrative Agent shall not be
the Applicable Agent and the Lenders with the Commitment to be reduced or
terminated of the contents thereof.  Each notice delivered by the Parent
pursuant to this Section shall be irrevocable.  Any termination or reduction of
the Commitments of any Class shall be permanent.  Each reduction of the
Commitments shall be made ratably among the Lenders in accordance with their
respective Commitments.

 

Section 2.09           Repayment of Loans; Evidence of Debt.

 

(a)           Each US Borrower hereby unconditionally promises to pay (i) to the
US Administrative Agent for the account of each US Lender the then unpaid
principal amount of each US Loan (other than US Swingline Loans) on the
Termination Date and (ii) to the US Swingline Lender the then unpaid principal
amount of each US Swingline Loan on the earliest of (A) the date that is
fourteen (14) days after the date such Swingline Loan was made and (B) the
Termination Date; provided that on each date that a US Borrowing (other than a
US Swingline Loan) is made, the applicable US Borrowers shall repay all US
Swingline Loans then outstanding.  Each Euro Borrower hereby unconditionally
promises to pay (i) to the Euro Administrative Agent for the account of each
Euro Lender the then unpaid principal amount of each Euro Loan (other than Euro
Swingline Loans) on the Termination Date and (ii) to the Euro Swingline Lender
the then unpaid principal amount of each Euro Swingline Loan on the earliest of
(A) the date that is fourteen (14) days after the date such Swingline Loan was
made and (B) the Termination Date; provided that on each date that a Euro
Borrowing (other than a Euro Swingline Loan) is made, the applicable Euro
Borrowers shall repay all Euro Swingline Loans then outstanding.  Each Canadian
Borrower hereby unconditionally promises to pay to the Canadian Administrative
Agent for the account of each Canadian Lender the then unpaid principal amount
of each Canadian Loan on the Termination Date.

 

(b)           Each Lender shall maintain in accordance with its usual practice
an account or accounts evidencing the Indebtedness of each Borrower to such
Lender resulting from each Loan made by such Lender, including the amounts of
principal and interest payable and paid to such Lender from time to time
hereunder.

 

(c)           The US Administrative Agent shall maintain accounts in which it
shall record (i) the amount of each Loan made under the US Commitments, the Type
thereof and the Interest Period, if any, applicable thereto, (ii) the amount of
any principal or interest due and payable or to become due and payable from the
US Borrowers to each US Lender hereunder and (iii) the amount of any sum
received by the US Administrative Agent hereunder for the account of the US
Lenders and each such Lender’s share thereof.

 

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(d)           The Euro Administrative Agent shall maintain accounts in which it
shall record (i) the amount of each Loan made under the Euro Commitments and the
Interest Period applicable thereto, (ii) the amount of any principal or interest
due and payable or to become due and payable from the Euro Borrowers to each
Euro Lender and (iii) the amount of any sum received by the Euro Administrative
Agent hereunder for the account of the Euro Lenders and each such Lender’s share
thereof.

 

(e)           The Canadian Administrative Agent shall maintain accounts in which
it shall record (i) the amount of each Loan made under the Canadian Commitments,
the Type thereof and the Interest Period, if any, applicable thereto, (ii) the
amount of any principal or interest due and payable or to become due and payable
from the Canadian Borrowers to each Canadian Lender and (iii) the amount of any
sum received by the Canadian Administrative Agent hereunder for the account of
the Canadian Lenders and each such Lender’s share thereof.

 

(f)            The entries made in the accounts maintained pursuant to paragraph
(b), (c), (d) or (e) of this Section shall be prima facie evidence of the
existence and amounts of the obligations recorded therein; provided that the
failure of any Lender or any of the Agents to maintain such accounts or any
error therein shall not in any manner affect the obligation of each Borrower to
repay the respective Loans made to it in accordance with the terms of this
Agreement.

 

(g)           Any Lender may request that Loans of any Class made by it be
evidenced by a promissory note.  In such event, the applicable Borrower shall
prepare, execute and deliver to such Lender a promissory note payable to the
order of such Lender (or, if requested by such Lender, to such Lender and its
registered assigns) and in a form approved by the Applicable Agent.  Thereafter,
the Loans evidenced by such promissory note and interest thereon shall at all
times (including after assignment pursuant to Section 10.04) be represented by
one or more promissory notes in such form payable to the order of the payee
named therein (or, if such promissory note is a registered note, to such payee
and its registered assigns).

 

Section 2.10           Prepayment of Loans.

 

(a)           Each Borrower shall have the right at any time and from time to
time to prepay any Borrowing selected by it in whole or in part, without penalty
or premium (other than breakage costs and similar expenses, if any, due under
Section 2.15), subject to prior notice in accordance with paragraph (c) of this
Section.

 

(b)           If at any time the total US Credit Exposures exceed the total US
Commitments, the US Borrowers shall (i) prepay US Borrowings in an aggregate
amount equal to such excess and (ii) if any excess remains after prepaying all
of the US Borrowings as a result of US LC Exposure, pay to the US Administrative
Agent on behalf of the US Lenders an amount in cash in Dollars equal to such
excess to be held as cash collateral as provided in Section 2.05(j).  If at any
time the total Euro Credit Exposures exceed the total Euro Commitments, the Euro
Borrowers shall (i) prepay Euro Borrowings in an aggregate amount equal to such
excess and (ii) if any excess remains after prepaying all of the Euro Borrowings
as a result of Euro LC Exposure, pay to the Euro Administrative Agent on behalf
of the Euro Lenders an amount in cash in Euros equal to such excess to be held
as cash collateral as provided in Section 2.05(j).  If at any time the total
Canadian Credit Exposures exceed the total Canadian Commitments, the Canadian

 

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Borrowers shall (i) prepay Canadian Borrowings in an aggregate amount equal to
such excess and (ii) if any excess remains after prepaying all of the Canadian
Borrowings as a result of Canadian LC Exposure, pay to the Canadian
Administrative Agent on behalf of the Canadian Lenders an amount in cash in
Canadian Dollars equal to such excess to be held as cash collateral as provided
in Section 2.05(j).

 

(c)           The applicable Borrower shall notify the Applicable Agent (and, in
the case of prepayment of a Swingline Loan, the applicable Swingline Lender) of
any prepayment hereunder (i) in the case of prepayment of a Eurodollar
Borrowing, by telephone (confirmed by facsimile or electronic communication) not
later than 12:00 noon, Local Time, three (3) Business Days before the date of
prepayment, (ii) in the case of prepayment of an ABR Borrowing, by telephone
(confirmed by facsimile or electronic communication) not later than 12:00 noon,
Local Time, one (1) Business Day before the date of prepayment, (iii) in the
case of prepayment of a Eurocurrency Loan, by facsimile or electronic
communication not later than 11:00 a.m., Local Time, three (3) Business Days
before the date of prepayment, (iv) in the case of repayment of a CDOR Loan, by
facsimile or electronic communication not later than 12:00 noon, Local Time,
three (3) Business Days before the date of prepayment, (v) in the case of
repayment of a Canadian Prime Loan by facsimile or electronic communication, not
later than 12:00 noon, Local Time, one (1) Business Day before the date of
prepayment, (vi) in the case of prepayment of a US Swingline Loan, by telephone
(confirmed by facsimile or electronic communication), not later than 1:00 p.m.,
Local Time, on the date of prepayment and (vii) in the case of prepayment of a
Euro Swingline Loan, by facsimile or electronic communication, not later than
1:00 p.m., Local Time, on the date of prepayment.  Each such notice shall be
irrevocable and shall specify the prepayment date and the principal amount of
each Borrowing or portion thereof to be prepaid.  Promptly following receipt of
any such notice relating to a Borrowing (other than a Swingline Loan), the
Applicable Agent shall advise the relevant Lenders of the contents thereof. 
Each partial prepayment of any Borrowing shall be in an amount that would be
permitted in the case of an advance of a Borrowing of the same Class and Type as
provided in Section 2.02.  Prepayments shall be accompanied by accrued interest
to the extent required by Section 2.12.

 

Section 2.11           Fees.

 

(a)           The US Borrowers shall pay to the US Administrative Agent for the
account of each US Lender a commitment fee, which shall accrue at the Commitment
Fee Rate on the daily amount of the unused US Commitment of such US Lender
during the period from and including the Effective Date to but excluding the
date on which such US Commitment terminates.  Accrued commitment fees shall be
payable in arrears on the last day of March, June, September and December of
each year and on the date on which the US Commitments terminate, commencing on
the first such date to occur after the Effective Date.  All commitment fees
shall be computed on the basis of a year of 360 days and shall be payable for
the actual number of days elapsed (including the first day but excluding the
last day).  For purposes of calculating the unused US Commitment of each US
Lender, US Swingline Loans made or deemed made or attributable to such Lender
shall not count as usage.

 

(b)           The US Borrowers shall pay (i) to the US Administrative Agent for
the account of each US Lender a participation fee with respect to its
participations in US Letters of Credit, which shall accrue at the same
Applicable Margin used to determine the interest rate applicable

 

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to Eurodollar Loans on the average daily amount of such Lender’s US LC Exposure
(excluding any portion thereof attributable to unreimbursed US LC Disbursements)
during the period from and including the Effective Date to but excluding the
later of the date on which such Lender’s US Commitment terminates and the date
on which it ceases to have any US LC Exposure and (ii) to the US Issuing Lender
a fronting fee, which shall accrue at the rate of 0.125% per annum on the
average daily amount of the US LC Exposure (excluding any portion thereof
attributable to unreimbursed US LC Disbursements) during the period from and
including the Effective Date to but excluding the later of the date of
termination of the US Commitments and the date on which there ceases to be any
US LC Exposure, but in no event less than $500 during such period as well as the
US Issuing Lender’s standard fees with respect to the issuance, amendment,
renewal or extension of any US Letter of Credit or processing of drawings
thereunder.  Participation fees and fronting fees accrued through and including
the last day of March, June, September and December of each year shall be
payable on the third Business Day following such last day of such months,
commencing on the first such date to occur after the Effective Date; provided
that all such fees shall be payable on the date on which the US Commitments
terminate and any such fees accruing after the date on which the US Commitments
terminate shall be payable on demand.  Any other fees payable to the US Issuing
Lender pursuant to this paragraph shall be payable within 10 days after demand. 
All participation fees and fronting fees shall be computed on the basis of a
year of 360 days and shall be payable for the actual number of days elapsed
(including the first day but excluding the last day).

 

(c)           The Euro Borrowers shall pay to the Euro Administrative Agent for
the account of each Euro Lender a commitment fee, which shall accrue at the
Commitment Fee Rate on the daily amount of the unused Euro Commitment of such
Lender during the period from and including the Effective Date to but excluding
the date on which such Euro Commitment terminates.  Accrued commitment fees
shall be payable in arrears on the last day of March, June, September and
December of each year and on the date on which the Euro Commitments terminate,
commencing on the first such date to occur after the Effective Date.  All
commitment fees shall be computed on the basis of a year of 360 days and shall
be payable for the actual number of days elapsed (including the first day but
excluding the last day).  For purposes of calculating the unused Euro Commitment
of each Euro Lender, Euro Swingline Loans made or deemed made or attributable to
such Lender shall not count as usage.

 

(d)           The Euro Borrowers shall pay (i) to the Euro Administrative Agent
for the account of each Euro Lender a participation fee with respect to its
participations in Euro Letters of Credit, which shall accrue at the same
Applicable Margin used to determine the interest rate applicable to Eurocurrency
Loans on the average daily amount of such Lender’s Euro LC Exposure (excluding
any portion thereof attributable to unreimbursed Euro LC Disbursements) during
the period from and including the Effective Date to but excluding the later of
the date on which such Lender’s Euro Commitment terminates and the date on which
it ceases to have any Euro LC Exposure and (ii) to the Euro Issuing Lender a
fronting fee, which shall accrue at the rate of 0.125% per annum on the average
daily amount of the Euro LC Exposure (excluding any portion thereof attributable
to unreimbursed Euro LC Disbursements) during the period from and including the
Effective Date to but excluding the later of the date of termination of the Euro
Commitments and the date on which there ceases to be any Euro LC Exposure, but
in no event less than $500 during such period as well as the Euro Issuing
Lender’s standard fees with respect to the issuance, amendment, renewal or
extension of any Letter of Credit or processing of

 

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drawings thereunder.  Participation fees and fronting fees accrued through and
including the last day of March, June, September and December of each year shall
be payable on the third Business Day following such last day of such months,
commencing on the first such date to occur after the Effective Date; provided
that all such fees shall be payable on the date on which the Euro Commitments
terminate and any such fees accruing after the date on which the Euro
Commitments terminate shall be payable on demand.  Any other fees payable to the
Euro Issuing Lender pursuant to this paragraph shall be payable within 10 days
after demand.  All participation fees and fronting fees shall be computed on the
basis of a year of 360 days and shall be payable for the actual number of days
elapsed (including the first day but excluding the last day).

 

(e)           The Canadian Borrowers shall pay to the Canadian Administrative
Agent for the account of each Canadian Lender a commitment fee, which shall
accrue at the Commitment Fee Rate on the daily amount of the unused Canadian
Commitment of such Lender during the period from and including the Effective
Date to but excluding the date on which such Canadian Commitment terminates. 
Accrued commitment fees shall be payable in arrears on the last day of March,
June, September and December of each year and on the date on which the Canadian
Commitments terminate, commencing on the first such date to occur after the
Effective Date.  All commitment fees shall be computed on the basis of a year of
360 days and shall be payable for the actual number of days elapsed (including
the first day but excluding the last day).

 

(f)            The Canadian Borrowers shall pay (i) to the Canadian
Administrative Agent for the account of each Canadian Lender a participation fee
with respect to its participations in Canadian Letters of Credit, which shall
accrue at the same Applicable Margin used to determine the interest rate
applicable to CDOR Loans on the average daily amount of such Lender’s Canadian
LC Exposure (excluding any portion thereof attributable to unreimbursed Canadian
LC Disbursements) during the period from and including the Effective Date to but
excluding the later of the date on which such Lender’s Canadian Commitment
terminates and the date on which it ceases to have any Canadian LC Exposure and
(ii) to the Canadian Issuing Lender a fronting fee, which shall accrue at the
rate of 0.125% per annum on the average daily amount of the Canadian LC Exposure
(excluding any portion thereof attributable to unreimbursed Canadian LC
Disbursements) during the period from and including the Effective Date to but
excluding the later of the date of termination of the Canadian Commitments and
the date on which there ceases to be any Canadian LC Exposure, but in no event
less than C$500 during such period as well as the Canadian Issuing Lender’s
standard fees with respect to the issuance, amendment, renewal or extension of
any Canadian Letter of Credit or processing of drawings thereunder. 
Participation fees and fronting fees accrued through and including the last day
of March, June, September and December of each year shall be payable on the
third Business Day following such last day of such months, commencing on the
first such date to occur after the Effective Date; provided that all such fees
shall be payable on the date on which the Canadian Commitments terminate and any
such fees accruing after the date on which the Canadian Commitments terminate
shall be payable on demand.  Any other fees payable to the Canadian Issuing
Lender pursuant to this paragraph shall be payable within 10 days after demand. 
All participation fees and fronting fees shall be computed on the basis of a
year of 360 days and shall be payable for the actual number of days elapsed
(including the first day but excluding the last day).

 

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(g)           The Parent shall pay to the each Agent, as applicable, for its own
account, fees payable by it in the amounts and at the times specified in the Fee
Letter, or otherwise separately agreed upon, between the Parent and the Agents.

 

(h)           All fees payable hereunder to the Agents or the Issuing Lenders
shall be paid on the dates due, in immediately available funds, in Dollars, in
the case of fees payable under (a) and (b) above, in Euros in the case of fees
payable under (c) and (d) above and in Canadian Dollars in the case of fees
payable under (e) and (f) above, in each case, to the Applicable Agent (or to
the Applicable Issuing Lender, in the case of fees payable to it) for
distribution, in the case of commitment fees and participation fees, to the
applicable Lenders.  Fees payable under this Section 2.11 shall not be past due
if paid within five (5) Business Days after receipt of a statement by the Parent
from the Applicable Agent or the Applicable Issuing Lender, or the US
Administrative Agent on its own behalf or on the behalf of any other Agent or
any Issuing Lender, setting forth the amount of such fees.  Fees paid shall not
be refundable under any circumstances absent manifest error.

 

Section 2.12           Interest.

 

(a)           The Loans comprising each ABR Borrowing (including each US
Swingline Loan) shall bear interest at the Alternate Base Rate plus the
Applicable Margin.

 

(b)           The Loans comprising each Eurodollar Borrowing shall bear interest
at the Adjusted LIBO Rate for the Interest Period in effect for such Borrowing
plus the Applicable Margin.

 

(c)           The Loans comprising each Eurocurrency Borrowing shall bear
interest at the Eurocurrency Rate plus the Applicable Margin, plus the Mandatory
Cost, if any.

 

(d)           The Loans comprising each Canadian Prime Borrowing shall bear
interest at the Canadian Prime Rate plus the Applicable Margin.

 

(e)           The Loans comprising each CDOR Borrowing shall bear interest at
the Canadian Dealer Offered Rate for the Interest Period in effect for such
Borrowing plus the Applicable Margin.

 

(f)            Each Euro Swingline Loan shall bear interest at the Euro
Swingline Rate.

 

(g)           Notwithstanding the foregoing, if any principal of or interest on
any Loan or any fee or other amount payable by any Borrower hereunder is not
paid when due, such overdue amount shall bear interest at the Default Rate.

 

(h)           Accrued interest on each Loan shall be payable in arrears on each
Interest Payment Date for such Loan and, in the case of Loans of any
Class (other than Swingline Loans), upon termination of the Commitments of such
Class; provided that (i) interest accrued pursuant to paragraph (e) of this
Section shall be payable on demand, (ii) in the event of any repayment or
prepayment of any Loan (other than a prepayment of an ABR Loan or Canadian Prime
Loan prior to the end of the Availability Period), accrued interest on the
principal amount repaid or prepaid shall be payable on the date of such
repayment or prepayment and (iii) in the

 

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event of any conversion of any Eurodollar Loan or CDOR Loan prior to the end of
the current Interest Period therefor, accrued interest on such Loan shall be
payable on the effective date of such conversion.

 

(i)            All interest hereunder shall be computed on the basis of a year
of 360 days, except that interest computed by reference to (i) the Alternate
Base Rate at times when the Alternate Base Rate is based on the Prime Rate,
(ii) the Canadian Dealer Offered Rate or (iii) the Canadian Prime Rate shall be
computed on the basis of a year of 365 days (or 366 days in a leap year), and in
each case shall be payable for the actual number of days elapsed (including the
first day but excluding the last day).  The applicable Alternate Base Rate,
Adjusted LIBO Rate, LIBO Rate, Eurocurrency Rate, Canadian Prime Rate or
Canadian Offered Rate shall be determined by the Applicable Agent and such
determination shall be conclusive absent manifest error.

 

Section 2.13           Alternate Rate of Interest.  If prior to the commencement
of any Interest Period for a Eurodollar Borrowing, Eurocurrency Borrowing or
CDOR Borrowing:

 

(a)           the Applicable Agent determines (which determination shall be
conclusive absent manifest error) that adequate and reasonable means do not
exist for ascertaining the Adjusted LIBO Rate, the LIBO Rate, the Eurocurrency
Rate or the Canadian Dealer Offered Rate, as applicable, for such Interest
Period; or

 

(b)           in the case of Eurodollar Borrowings only, the US Administrative
Agent is advised by the Lenders having US Credit Exposure and unused US
Commitments representing more than 50% of the sum of the total US Credit
Exposures and such unused US Commitments at such time that the Adjusted LIBO
Rate or the LIBO Rate, as applicable, for such Interest Period will not
adequately and fairly reflect the cost to such Lenders of making or maintaining
their Loans included in such Borrowing for such Interest Period;

 

then the Applicable Agent shall give notice thereof to the Parent and the
applicable Lenders by telephone, facsimile or electronic communication as
promptly as practicable thereafter and, until the Applicable Agent notifies the
Parent and such Lenders that the circumstances giving rise to such notice no
longer exist, (i) any Interest Election Request that requests the conversion of
any Borrowing to, or continuation of any Borrowing as, a Eurodollar Borrowing
shall be ineffective, (ii) if any Borrowing Request requests a Eurodollar
Borrowing, such Borrowing shall be made as an ABR Borrowing, (iii) if any
Borrowing Request requests a Eurocurrency Borrowing, such request shall be
deemed to be withdrawn and (iv) if any Borrowing Request requests a CDOR
Borrowing, such Borrowing shall be made as a Canadian Prime Borrowing.

 

Section 2.14           Increased Costs.

 

(a)           If any Change in Law shall:

 

(i)            impose, modify or deem applicable any reserve, special deposit,
compulsory loan, insurance charges or similar requirement against assets of,
deposits with or for the account of, or credit extended by, any Lender (except
any such reserve requirement reflected in the Adjusted LIBO Rate or the
Mandatory Cost) or any Issuing Lender;

 

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(ii)           impose on any such Lender or Issuing Lender or the London
interbank market or the European Union banking market any other condition
affecting this Agreement or Eurodollar Loans, Eurocurrency Loans or CDOR Loans
made by such Lender or any Letter of Credit or participation therein; or

 

(iii)          subject any Recipient to any Taxes (other than (A) Indemnified
Taxes, (B) Taxes described in clauses (b) through (d) of the definition of
Excluded Taxes and (C) Connection Income Taxes) on its loans, loan principal,
letters of credit, commitments, or other obligations, or its deposits, reserves,
other liabilities or capital attributable thereto;

 

and the result of any of the foregoing shall be to increase the cost (other than
with respect to Taxes, which shall be governed solely by Section 2.16) to such
Lender of making or maintaining any Eurodollar Loan, Eurocurrency Loan or CDOR
Loan (or of maintaining its obligation to make any such Loan) or to increase the
cost to such Lender or Issuing Lender of participating in, issuing or
maintaining any Letter of Credit or to reduce the amount of any sum received or
receivable by such Lender or Issuing Lender hereunder (whether of principal,
interest or otherwise), then the Parent will pay to any such Lender or Issuing
Lender such additional amount or amounts as will compensate such Lender or
Issuing Lender for such additional costs incurred or reduction suffered.

 

(b)           If any Lender or Issuing Lender determines that any Change in Law
regarding capital requirements has or would have the effect of reducing the rate
of return on such Lender’s or Issuing Lender’s capital or on the capital of such
Lender’s or Issuing Lender’s holding company, if any, as a consequence of this
Agreement or the Loans made by, or participations in Letters of Credit held by,
such Lender, or the Letters of Credit issued by such Issuing Lender, to a level
below that which such Lender or Issuing Lender or such Lender’s or Issuing
Lender’s holding company could have achieved but for such Change in Law (taking
into consideration such Lender’s or Issuing Lender’s policies and the policies
of such Lender’s or Issuing Lender’s holding company with respect to capital
adequacy), then from time to time the Parent will pay to any such Lender or
Issuing Lender such additional amount or amounts as will compensate such Lender
or Issuing Lender or such Lender’s or Issuing Lender’s holding company for any
such reduction suffered.

 

(c)           A certificate of a Lender or an Issuing Lender setting forth in
reasonable detail the amount or amounts necessary to compensate such Lender or
Issuing Lender or its holding company, as applicable, as specified in paragraph
(a) or (b) of this Section (subject to paragraph (e) of this Section) shall be
delivered to the Parent and shall be conclusive absent manifest error.  The
Parent shall pay any such Lender or Issuing Lender the amount shown as due on
any such certificate within 10 Business Days after receipt thereof.

 

(d)           Failure or delay on the part of any Lender or Issuing Lender to
demand compensation pursuant to this Section shall not constitute a waiver of
such Lender’s or Issuing Lender’s right to demand such compensation; provided
that the Parent shall not be required to compensate a Lender or an Issuing
Lender pursuant to this Section for any increased costs or reductions incurred
more than 180 days prior to the date that such Lender or Issuing Lender notifies
the Parent of the Change in Law giving rise to such increased costs or
reductions and of such Lender’s or Issuing Lender’s intention to claim
compensation therefor; provided, further,

 

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that, if the Change in Law giving rise to such increased costs or reductions is
retroactive, then the 180-day period referred to above shall be extended to
include the period of retroactive effect thereof; provided, further, that no
Lender shall seek compensation from the Parent unless such Lender is actively
seeking compensation from other similarly situated borrowers as well.

 

(e)           Notwithstanding anything to the contrary under paragraphs (a) and
(b) of this Section, neither paragraph (a) nor (b) of this Section shall apply
to the extent the amount or amounts necessary to compensate such Lender or
Issuing Lender or its holding company, as applicable, as specified in paragraph
(a) or (b) of this Section, is (i) attributable to the gross negligence of a
Lender or its Affiliate that results in its failing to comply with any Law,
(ii) attributable to any deduction or withholding for or on account of Tax from
a payment under any Loan Document required by law to be made by any Obligor,
(iii) any Tax or amount relating to Taxes or (iv) compensated for by the payment
of Mandatory Cost.

 

Section 2.15           Break Funding Payments.  In the event of (a) the payment
of any principal of any Eurodollar Loan, Eurocurrency Loan or CDOR Loan other
than on the last day of an Interest Period applicable thereto (including as a
result of an Event of Default), (b) the conversion of any Eurodollar Loan or
CDOR Loan other than on the last day of the Interest Period applicable thereto
or (c) the failure to borrow, convert, continue or prepay any Eurodollar Loan,
Eurocurrency Loan or CDOR Loan on the date specified in any notice delivered
pursuant hereto, then, in any such event, the applicable Borrowers shall
compensate each affected Lender for the loss, cost and expense (other than any
lost profit or margin) attributable to such event.  In the case of a Eurodollar
Loan, Eurocurrency Loan or CDOR Loan, such loss, cost or expense to any Lender
shall be deemed to include an amount reasonably determined by such Lender to be
the excess, if any, of (i) its costs of obtaining funds for the Loan being paid,
prepaid or converted or not borrowed based on the Adjusted LIBO Rate, the
Eurocurrency Rate or the Canadian Dealer Offered Rate that would have been
applicable to such Loan, for the period from the date of such event to the last
day of the then current Interest Period therefor (or, in the case of a failure
to borrow, convert or continue, for the period that would have been the Interest
Period for such Loan), over (ii) the amount of interest that would accrue on
such principal amount for such period at the interest rate that such Lender
would realize by such Lender in reemploying during such period the funds so
paid, prepaid, converted or not borrowed.  A certificate of any Lender setting
forth in reasonable detail any amount or amounts that such Lender is entitled to
receive pursuant to this Section shall be delivered to the Parent and shall be
conclusive absent manifest error.  The Parent shall pay any such Lender the
amount shown as due on any such certificate within 10 Business Days after
receipt thereof.  The Parent shall not be obligated to compensate a Lender
pursuant to this Section for any amount relating to any such event occurring
more than 180 days prior to the date such Lender notifies the Parent of such
Lender’s intention to claim compensation therefor

 

Section 2.16           Taxes.

 

(a)           Any and all payments by or on account of any obligation of any
Borrower hereunder shall be made free and clear of and without deduction for any
Indemnified Taxes or Other Taxes; provided that if such Borrower shall be
required to deduct any Indemnified Taxes or Other Taxes from such payments, then
(i) the sum payable shall be increased as necessary so that after making all
required deductions (including deductions applicable to additional sums

 

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payable under this Section) the Agents, any Lender or any Issuing Lender (as
applicable) receives an amount equal to the sum it would have received had no
such deductions been made, (ii) such Borrower shall make such deductions and
(iii) such Borrower shall pay the full amount deducted to the relevant
Governmental Authority in accordance with applicable Law.

 

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

 

(c)           The Borrowers shall indemnify the Agents, each Lender and each
Issuing Lender, within 10 days after written demand therefor, for the full
amount of any Indemnified Taxes or Other Taxes paid by the Agents, such Lender
or such Issuing Lender, as the case may be, on or with respect to any payment by
or on account of any obligation of the Borrowers hereunder (including
Indemnified Taxes or Other Taxes imposed or asserted on or attributable to
amounts payable under this Section 2.16) 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; provided that no Euro Borrower
shall have any liability under this Section 2.16(c) with respect to Indemnified
Taxes or Other Taxes attributable to any Loan made to or other Obligation of any
US Borrower.  A certificate as to the amount of such payment or liability
delivered to the Borrower by such Lender or such Issuing Lender, or by an Agent
on its own behalf or on behalf of such Lender or Issuing Lender, shall be
conclusive absent manifest error.

 

(d)           As soon as practicable after any payment of Indemnified Taxes or
Other Taxes by any Borrower to a Governmental Authority, such Borrower shall
deliver to the relevant Agent the original or a certified copy of a receipt
issued by such Governmental Authority evidencing such payment, a copy of the
return reporting such payment or other evidence of such payment reasonably
satisfactory to the relevant Agent.

 

(e)           (i)  Any Lender that is entitled to an exemption from or reduction
of withholding Tax with respect to payments made under any Loan Document shall
deliver to the Parent and the US Administrative Agent, at the time such Person
becomes a party to this Agreement and at such time or times reasonably requested
by the Parent or the US Administrative Agent, such properly completed and
executed documentation prescribed by applicable Law or reasonably requested by
the Parent or the US Administrative Agent as will permit such payments to be
made without withholdings or at a reduced rate of withholding.  In addition, any
Lender, if reasonably requested by the Parent or the US Administrative Agent,
shall deliver such other documentation prescribed by applicable Law or
reasonably requested by the Parent or the US Administrative Agent to determine
whether or not such Lender is subject to backup withholding or information
reporting requirements.  Notwithstanding anything to the contrary in the
preceding two sentences, the completion, execution and submission of such
documentation (other than such documentation set forth in
Section 2.16(e)(ii)(A), (ii)(B) and (ii)(D) below) shall not be required if in
the Lender’s judgment such completion, execution or submission would subject
such Lender to any material unreimbursed cost or expense or would materially
prejudice the legal or commercial position of such Lender.

 

(ii)           Without limiting the generality of the foregoing,

 

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(A)          any Lender that is a U.S. Person shall deliver to the Parent and
the US Administrative Agent on or prior to the date on which such Lender becomes
a Lender under this Agreement (and from time to time thereafter upon the
reasonable request of the Parent or the US Administrative Agent), executed
originals of IRS Form W-9 certifying that such Lender is exempt from U.S.
Federal backup withholding tax;

 

(B)           any Foreign Lender shall, to the extent it is legally entitled to
do so, deliver to the Parent and the US Administrative Agent (in such number of
copies as shall be requested by the recipient) on or prior to the date on which
such Foreign Lender becomes a Lender under this Agreement (and from time to time
thereafter upon the reasonable request of the Parent or the US Administrative
Agent), whichever of the following is applicable:

 

(i)            in the case of a Foreign Lender claiming the benefits of an
income tax treaty to which the Untied States is a party (x) with respect to
payments of interest under any Loan Document, executed originals of IRS
Form W-8BEN establishing an exemption from, or reduction or, U.S. federal
withholding Tax pursuant to the “interest” article of such tax treaty and
(y) with respect to any other applicable payments under any Loan Document,
executed originals of IRS Form W-8BEN establishing an exemption from, or
reduction of, U.S. federal withholding Tax pursuant to the “business profits” or
“other income” article of such tax treaty;

 

(ii)           executed originals of IRS Form W-8ECI certifying that it is
entitled to receive all payments under the Loan Documents without deduction or
withholding in respect of U.S. federal withholding Tax;

 

(iii)          in the case of a Foreign Lender claiming the benefits of the
exemption for portfolio interest under Section 881(c) of the Code, (x) a
certificate to the effect that (A) such Foreign Lender is not a “bank” within
the meaning of Section 881(c)(3)(A) of the Code, a “10 percent shareholder” of
the Borrower within the meaning of Section 881(c)(3)(B) of the Code, or a
“controlled foreign corporation” described in Section 881(c)(3)(C) of the Code
and (B) the interest payments in question are not effectively connected with a
U.S. trade or business conducted by such Foreign Lender (a “U.S. Tax Compliance
Certificate”) and (y) executed originals of IRS Form W-8BEN; or

 

(iv)          to the extent a Foreign Lender is not the beneficial owner (for
example, where the Foreign Lender is a partnership or participating Lender
granting a typical participation), executed originals of IRS Form W-8IMY,
accompanied by a Form W-8ECI,

 

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W-8BEN, U.S. Tax Compliance Certificate, Form W-9, and/or other certification
documents from each beneficial owner, as applicable; provided that if the
Foreign Lender is a partnership (and not a participating Lender) and one or more
beneficial owners of such Foreign Lender are claiming the portfolio interest
exemption, such Foreign Lender may provide a U.S. Tax Compliance Certificate on
behalf of each such beneficial owner;

 

(C)           any Foreign Lender shall, to the extent it is legally entitled to
do so, deliver to the Parent and the US Administrative Agent (in such number of
copies as shall be requested by the recipient) on or prior to the date on which
such Foreign Lender becomes a party to this Agreement (and from time to time
thereafter upon the reasonable request of the Parent or the US Administrative
Agent), executed originals of any other form prescribed by applicable law as a
basis for claiming exemption from or a reduction in U.S. federal withholding
Tax, duly completed, together with such supplementary documentation as may be
prescribed by applicable law to permit the Parent or the US Administrative Agent
to determine the withholding or deduction required to be made; and

 

(D)          If a payment made to a Lender under any Loan Document would be
subject to U.S. federal withholding Tax imposed by FATCA if such Lender were to
fail to comply with the applicable reporting requirements of FATCA (including
those contained in Section 1471(b) or 1472(b) of the Code, as applicable), such
Lender shall deliver to the Parent and the US Administrative Agent at the time
or times prescribed by law and at such time or times reasonably requested by the
Parent or the US Administrative Agent such documentation prescribed by
applicable law (including as prescribed by Section 1471(b)(3)(C)(i) of the Code)
and such additional documentation reasonably requested by the Parent or the US
Administrative Agent as may be necessary for the Parent and the US
Administrative Agent to comply with their obligations under FATCA and to
determine that such Lender has complied with such Lender’s obligations under
FATCA or to determine the amount to deduct and withhold from such payment.

 

Each Lender agrees that if any form or certification it previously delivered
expires or becomes obsolete or inaccurate in any respect, it shall update such
form or certification or promptly notify the Parent and the US Administrative
Agent in writing of its legal inability to do so.

 

(f)            If any Agent or a Lender determines, in its sole discretion, that
it has received a refund of any Taxes or other amounts as to which it has been
indemnified by the Borrowers or with respect to which any Borrower has paid
additional amounts pursuant to this Section 2.16, it shall pay over such refund
to such Borrower (but only to the extent of indemnity payments made, or
additional amounts paid, by such Borrower under this Section 2.16 with respect
to the Taxes or other amounts giving rise to such refund), net of all reasonable
and documented out-of-pocket expenses of such Agent or Lender and without
interest (other than any interest paid by the relevant Governmental Authority
with respect to such refund); provided, that such Borrower, upon the request of
such Agent or Lender, agrees to repay the amount paid over to such

 

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Borrower (plus any penalties, interest or other charges imposed by the relevant
Governmental Authority) to such Agent or Lender after receipt of written notice
that such Agent or Lender is required to repay such refund to such Governmental
Authority.  This Section shall not be construed to require any Agent or Lender
to make available its tax returns (or any other information relating to its
taxes which it deems confidential) to any Borrower or any other Person.

 

(g)           For purposes of this Section 2.16, references to a Lender shall
include each Agent and each Issuing Lender.

 

Section 2.17          Payments Generally; Pro Rata Treatment; Sharing of
Set-offs; Sharing of Collateral Proceeds and Payments After Default.

 

(a)           Each US Borrower shall make each payment required to be made by it
hereunder (whether of principal, interest, fees or reimbursement of US LC
Disbursements, or of amounts payable under Section 2.14, Section 2.15 or
Section 2.16, or otherwise) prior to 1:00 p.m., Local Time, on the date when
due, in immediately available funds, in Dollars, without set-off or
counterclaim.  Each Euro Borrower shall make each payment required to be made by
it hereunder (whether of principal, interest, fees or reimbursement of Euro LC
Disbursements, or of amounts payable under Section 2.14, Section 2.15 or
Section 2.16, or otherwise) prior to 1:00 p.m., Local Time, on the date when
due, in immediately available funds, in Euros, without set-off or counterclaim. 
Each Canadian Borrower shall make each payment to be made by it hereunder
(whether of principal, interest, fees or reimbursement of Canadian LC
Disbursements, or of amounts payable under Section 2.14, Section 2.15 or
Section 2.16, or otherwise) prior to 1:00 p.m., Local Time, on the date when
due, in immediately available funds, in Canadian Dollars, without set-off or
counterclaim.  Any amounts received after such times on any date may, in the
discretion of the Applicable Agent be deemed to have been received on the next
succeeding Business Day for purposes of calculating interest thereon.  All such
payments shall be made to the Applicable Agent at such account as the Applicable
Agent shall from time to time specify in a notice delivered to the applicable
Borrowers, except payments to be made directly to an Issuing Lender or a
Swingline Lender as expressly provided herein and except that payments pursuant
to Section 2.14, Section 2.15, Section 2.16 and Section 10.03 shall be made
directly to the Persons entitled thereto.  Each Agent shall distribute any such
payments received by it for the account of any other Person to the appropriate
recipient promptly following receipt thereof.  If any payment hereunder shall be
due on a day that is not a Business Day, the date for payment shall be extended
to the next succeeding Business Day, and, in the case of any payment accruing
interest, interest thereon shall be payable for the period of such extension. 
The Euro Administrative Agent and the Canadian Administrative Agent shall notify
the US Administrative Agent of payments received by them from time to time.

 

(b)           If at any time insufficient funds are received by and available to
the Applicable Agent to pay fully all amounts of principal, unreimbursed LC
Disbursements, interest and fees then due hereunder, such funds shall be applied
(i) first, towards payment of interest and fees then due hereunder, ratably
among the parties entitled thereto in accordance with the amounts of interest
and fees then due to such parties, and (ii) second, towards payment of principal
or unreimbursed LC Disbursements then due hereunder, ratably among the parties
entitled thereto

 

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in accordance with the amounts of principal and unreimbursed LC Disbursements
then due to such parties.

 

(c)           Subject to the provisions of Section 2.17(d), if any Lender shall,
by exercising any right of set-off or counterclaim or otherwise, obtain payment
in respect of any principal of or interest on any of its Loans or participations
in LC Disbursements or Swingline Loans resulting in such Lender receiving
payment of a greater proportion of the aggregate amount of its Loans and
participations in LC Disbursements and Swingline Loans and accrued interest
thereon than the proportion received by any other Lender, then the Lender
receiving such greater proportion shall purchase (for cash at face value)
participations in the Loans and participations in LC Disbursements and, in the
case of a US Lender or a Euro Lender, US Swingline Loans or Euro Swingline
Loans, as applicable, of other Lenders to the extent necessary so that the
benefit of all such payments shall be shared by (i) the US Lenders ratably in
accordance with the aggregate amount of principal of and accrued interest on
their respective US Loans and participations in US LC Disbursements and US
Swingline Loans, (ii) the Euro Lenders ratably in accordance with the aggregate
amount of principal of and accrued interest on their respective Euro Loans and
participations in Euro LC Disbursements and Euro Swingline Loans and (iii) the
Canadian Lenders ratably in accordance with the aggregate amount of principal of
and accrued interest on their respective Canadian Loans and participations in
Canadian LC Disbursements; provided that (x) if any such participations are
purchased and all or any portion of the payment giving rise thereto is
recovered, such participations shall be rescinded and the purchase price
restored to the extent of such recovery, without interest, and (y) the
provisions of this paragraph shall not be construed to apply to any payment made
by any Obligor pursuant to and in accordance with the express terms of this
Agreement or any payment obtained by a Lender as consideration for the
assignment of or sale of a participation in any of its Loans or participations
in LC Disbursements to any assignee or Participant, other than to the Parent,
any Subsidiary of the Parent or any Affiliate thereof (as to which the
provisions of this paragraph shall apply).  Each Borrower consents to the
foregoing and agrees, to the extent it may effectively do so under applicable
Law, that any Lender acquiring a participation pursuant to the foregoing
arrangements may exercise against such Borrower rights of set-off and
counterclaim with respect to such participation as fully as if such Lender were
a direct creditor of such Borrower in the amount of such participation.

 

(d)           Following acceleration of the Loans pursuant to this Agreement, if
at any time any payment on any of the Loans or any receipt of proceeds from any
Collateral results in the US Lenders, the Euro Lenders or the Canadian Lenders
receiving payments or proceeds in excess of their Class Percentage (defined
below) of all such payments or proceeds received, such Lenders will deliver any
excess to the US Administrative Agent and the US Administrative Agent shall
redistribute such excess to the extent required such that the US Lenders, the
Euro Lenders and the Canadian Lenders shall receive their Class Percentage of
such payment or proceeds.  All payments to the US Administrative Agent shall be
made in Dollars.  As used herein, the term “Class Percentage” for each Class of
the Lenders shall mean the percentage, expressed as a decimal and determined by
dividing the total Obligations, including obligations under Swap Agreements with
such Lenders, outstanding for each Class of the Lenders by the aggregate total
Obligations, including obligations under Swap Agreements with all Lenders,
outstanding after giving effect to such payment or receipt of proceeds, all as
calculated by the US Administrative Agent whose calculation shall be conclusive
absent manifest error.  For purposes of calculating

 

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the Class Percentage, all payments, proceeds and Loan amounts shall be deemed to
be in Dollars, with any necessary conversions being made at the rates determined
by the US Administrative Agent.  For purposes of determining the amount of any
payment to be made to the US Administrative Agent in Dollars under this
paragraph from any Euro Lender or Canadian Lender, the amount in Dollars payable
in respect of any Eurocurrency Loan, CDOR Loan or Canadian Prime Loan shall be
converted to Dollars at the rates determined by the US Administrative Agent.

 

(e)           Unless the Applicable Agent shall have received notice from
relevant Borrower or Borrowers prior to the date on which any payment is due to
the Applicable Agent for the account of the applicable Class of Lenders or
applicable Issuing Lenders hereunder that such Borrower or Borrowers will not
make such payment, the Applicable Agent may assume that such Borrower has, or
such Borrowers have, made such payment on such date in accordance herewith and
may, in reliance upon such assumption, distribute to the relevant Lenders or
Issuing Lender, as applicable, the amount due.  In such event, if such Borrower
has, or such Borrowers have, not in fact made such payment, then each of the
Lenders and the Issuing lender that has received such amounts, as applicable,
severally agrees to repay to the Applicable Agent forthwith on demand the amount
so distributed to such Lender or Issuing Lender with interest thereon, for each
day from and including the date such amount is distributed to it to but
excluding the date of payment to the Applicable Agent at the greater of
(i) (A) the Federal Funds Effective Rate with respect to amounts paid on the US
Loans, (B) the Eurocurrency Rate with respect to amounts paid on the Euro Loans
and (C) the Canadian Dealer Offered Rate with respect to amounts paid on the
Canadian Loans and (ii) a rate determined by the Applicable Agents accordance
with banking industry rules on interbank compensation.

 

(f)            If any Lender shall fail to make any payment required to be made
by it pursuant to Section 2.04(a) or Section 2.05(d) or Section 2.05(e),
Section 2.06(b), Section 2.17(e) or Section 10.03(c), then the Applicable Agent
may, in its discretion (notwithstanding any contrary provision hereof), apply
any amounts thereafter received by it for the account of such Lender to satisfy
such Lender’s obligations under such Sections until all such unsatisfied
obligations are fully paid.

 

Section 2.18          Mitigation Obligations; Replacement of Lenders.

 

(a)           If any Lender requests compensation under Section 2.14 or
Section 2.16, or if any Borrower is required to pay any additional amount to any
Lender or any Governmental Authority for the account of any Lender pursuant to
Section 2.16, then such Lender shall cooperate in completing any procedural
formalities required for each of the Borrowers to be able to make payments under
the Loan Documents without any deduction or withholding in respect of
Indemnified Taxes or Other Taxes and shall use reasonable efforts to designate a
different lending office for funding or booking its Loans hereunder or to assign
its rights and obligations hereunder to another of its offices, branches or
Affiliates, if, in the judgment of such Lender, such designation or assignment
(i) would eliminate or reduce amounts payable pursuant to Section 2.14 or
Section 2.16, as applicable, in the future and (ii) would not subject such
Lender to any unreimbursed cost or expense and would not otherwise be
disadvantageous to such Lender.  The Parent shall pay all reasonable costs and
expenses incurred by any Lender or Issuing Lender in connection with any such
designation or assignment.

 

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(b)           If (i) any Lender requests compensation under Section 2.14 or
Section 2.16, or if any Borrower is required to pay any additional amount to any
Lender or any Governmental Authority for the account of any Lender pursuant to
Section 2.16, (ii) any Lender is a Defaulting Lender, or (iii) any Lender
refuses to consent to an amendment, modification, waiver or consent of this
Agreement that requires consent of 100% of the Lenders pursuant to
Section 10.02(b) and the consent of the Required Lenders shall have been
obtained, then the Parent may, at its sole expense and effort, upon notice to
such Lender and the US Administrative Agent, require such Lender to assign and
delegate, without recourse (in accordance with and subject to the restrictions
contained in Section 10.04), all its interests, rights and obligations under
this Agreement to an assignee that shall assume such obligations (which assignee
may be another Lender, if a Lender accepts such assignment); provided that
(i) the Parent shall have received the prior written consent of each Agent which
consent shall not unreasonably be withheld, (ii) such Lender shall have received
payment of an amount equal to the outstanding principal of its Loans and
participations in LC Disbursements and Swingline Loans, as applicable, accrued
interest thereon, accrued fees and all other amounts payable to it hereunder, as
applicable, from the assignee (to the extent of such outstanding principal and
accrued interest and fees) or the Parent (in the case of all other amounts) and
(iii) in the case of any such assignment resulting from a claim for compensation
under Section 2.14 or payments required to be made pursuant to Section 2.16,
such assignment will or is expected to result in a reduction in such
compensation or payments.  A Lender shall not be required to make any such
assignment and delegation if, prior thereto, as a result of a waiver by such
Lender or otherwise, the circumstances entitling the Parent to require such
assignment and delegation cease to apply.

 

Section 2.19          Increase in the Commitments.

 

(a)           If no Default, Event of Default or Material Adverse Effect shall
have occurred and be continuing, the Parent may at any time and from time to
time during the Availability Period request one or more increases of the
Commitments, if any, by notice to the US Administrative Agent in writing of the
amount of such proposed increase (such notice, a “Commitment Increase Notice”);
provided, however, that (i) the Commitment of any Lender may not be increased
without such Lender’s consent, (ii) the minimum amount of any such increase
shall be $5,000,000, €3,000,000 or C$1,000,000, as applicable, and (iii) the
aggregate amount of increases in the Commitments shall not exceed $15,000,000,
or the equivalent thereof as determined by the US Administrative Agent. 
Notwithstanding the foregoing, no such increase shall cause the total Canadian
Commitment to exceed C$3,000,000.

 

(b)           Any such Commitment Increase Notice must offer each Lender (other
than a Defaulting Lender) the opportunity to subscribe for its pro rata share of
the requested increase in the Commitments, and the US Administrative Agent shall
promptly provide to each Lender a copy of any Commitment Increase Notice
received by the US Administrative Agent.  Within fifteen (15) Business Days
after receipt by the US Administrative Agent of the applicable Commitment
Increase Notice, each Lender that is not a Defaulting Lender wishing to
subscribe for its pro rata share of the requested increase in the Commitments
must deliver written notice of such fact to the US Administrative Agent.  If any
portion of the requested increase in the Commitments is not subscribed for by
the Lenders within such 15 Business Day period, the Parent may, in its sole
discretion, but with the consent of the US Administrative Agent as to any Person
that is not at such time a Lender (which consent shall not be unreasonably
withheld,

 

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delayed or conditioned), offer to any existing Lender that is not a Defaulting
Lender or to one or more additional banks or financial institutions the
opportunity to participate in all or a portion of such unsubscribed portion of
the increased Commitments pursuant to paragraph (c) or (d) below, as applicable,
by notifying the US Administrative Agent.  Promptly and in any event within five
(5) Business Days after receipt of notice from the Parent of its desire to offer
such unsubscribed commitments to certain existing Lenders, to the additional
banks or financial institutions identified therein or to such existing Lenders,
additional banks or financial institutions as may be identified by the US
Administrative Agent and approved by the Parent, the US Administrative Agent
shall notify such proposed lenders of the opportunity to participate in all or a
portion of such unsubscribed portion of the increased Commitments.

 

(c)           Any additional bank or financial institution that is not a Lender
that the Parent selects to offer participation in the increased Commitments
shall notify the US Administrative Agent of its agreement to participate in the
increased Commitments within five (5) Business Days of the date the US
Administrative Agent’s notice described in (b) above is sent and shall execute
and deliver to the US Administrative Agent a New Lender Agreement setting forth
its Commitment, and upon the effectiveness of such New Lender Agreement such
bank or financial institution (a “New Lender”) shall become a Lender for all
purposes and to the same extent as if originally a party hereto and shall be
bound by and entitled to the benefits of this Agreement, and the signature
pages hereof shall be deemed to be amended to add the name of such New Lender
and Schedule 2.01 and the definition of Commitment and US Commitment, Euro
Commitment or Canadian Commitment, as applicable, in Section 1.01 hereof shall
be deemed amended to increase the aggregate Commitments of the Lenders by the
Commitment of such New Lender, provided that the Commitment of any New Lender
shall be an amount not less than $5,000,000, €3,000,000 or C$1,000,000, as
applicable.  Each New Lender Agreement shall be irrevocable and shall be
effective upon notice thereof by the US Administrative Agent at the same time as
that of all other New Lenders or increasing Lenders.

 

(d)           Any Lender that accepts an offer to it by the Parent to increase
its Commitment pursuant to this Section 2.19 shall, in each case, execute a
Commitment Increase Agreement with the Parent and the US Administrative Agent,
whereupon such Lender shall be bound by and entitled to the benefits of this
Agreement with respect to the full amount of its Commitment as so increased, and
Schedule 2.01 and the definition of Commitment and US Commitment, Euro
Commitment or Canadian Commitment, as applicable, in Section 1.01 hereof shall
be deemed to be amended to reflect such increase.  Any Commitment Increase
Agreement shall be irrevocable and shall be effective upon notice thereof by the
US Administrative Agent at the same time as that of all other New Lenders and
increasing Lenders.

 

(e)           In addition to the requirements described above in paragraphs
(a) through (d), the effectiveness of any New Lender Agreement or Commitment
Increase Agreement shall be contingent upon receipt by the US Administrative
Agent of corporate resolutions of the Parent and the applicable Borrowers
authorizing such increase.  Once a New Lender Agreement or Commitment Increase
Agreement becomes effective, the appropriate Agent shall reflect the increases
in the Commitments effected by such agreements by appropriate entries in the
Register.

 

(f)            If any bank or financial institution becomes a New Lender
pursuant to Section 2.19(c) or any Lender’s Commitment is increased pursuant to
Section 2.19(d), additional Loans

 

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made on or after the effectiveness thereof (the “Re-Allocation Date”) shall be
made pro rata based on their respective Commitments in effect on or after such
Re-Allocation Date (except to the extent that any such pro rata borrowings would
result in any Lender making an aggregate principal amount of Loans in excess of
its Commitment, in which case such excess amount will be allocated to, and made
by, such New Lender and/or Lenders with such increased Commitments to the extent
of, and pro rata based on, their respective Commitments), and continuations of
Loans outstanding on such Re-Allocation Date shall be effected by repayment of
such Loans on the last day of the Interest Period applicable thereto or, in the
case of an ABR Loan or a Canadian Prime Loan, on the date of such increase, and
the making of new Loans of the same Type pro rata based on the respective
Commitments in effect on and after such Re-Allocation Date.

 

(g)           If on any Re-Allocation Date there is an unpaid principal amount
of Eurodollar Loans, Eurocurrency Loans or CDOR Loans, such Eurodollar Loans,
Eurocurrency Loans or CDOR Loans shall remain outstanding with the respective
holders thereof until the expiration of their respective Interest Periods
(unless the relevant Borrower elects to prepay any thereof in accordance with
the applicable provisions of this Agreement), and interest on and repayments of
such Eurodollar Loans, Eurocurrency Loans and CDOR Loans will be paid thereon to
the respective Lenders holding such Eurodollar Loans, Eurocurrency Loans and
CDOR Loans pro rata based on the respective principal amounts thereof
outstanding.

 

(h)           Upon the effectiveness of any Commitment Increase Agreement,
Schedule 2.01 and other pertinent sections hereof shall be automatically and
proportionately modified to reflect the increased Commitment, the exact figures
to be agreed between the Parent and the US Administrative Agent, and all
references to the Commitments shall be deemed amended mutatis mutandis.

 

Section 2.20          Defaulting Lenders.  Notwithstanding any provision of this
Agreement to the contrary, if any Lender becomes a Defaulting Lender, then the
following provisions shall apply for so long as such Lender is a Defaulting
Lender:

 

(a)           fees shall cease to accrue on the unfunded portion of the
Commitment of such Defaulting Lender pursuant to Section 2.11(a), (c) and/or
(e), as applicable;

 

(b)           the right of such Defaulting Lender to approve or disapprove any
amendment, waiver or consent with respect this Agreement shall be limited as set
forth in Section 10.02(b);

 

(c)           if any Swingline Exposure or LC Exposure exists at the time such
Lender becomes a Defaulting Lender then:

 

(i)            (A) all or any part of the US Swingline Exposure and US LC
Exposure of such Defaulting Lender, if any, shall be reallocated among the
non-Defaulting US Lenders in accordance with their respective Applicable
Percentages but only to the extent the sum of all non-Defaulting US Lenders’ US
Credit Exposures plus such Defaulting Lender’s US Swingline Exposure and US LC
Exposure does not exceed the total of all non-Defaulting US Lenders’ US
Commitments; (B) all or any part of the Euro Swingline Exposure and Euro LC
Exposure of such Defaulting Lender, if any, shall be reallocated among the
non-Defaulting Euro Lenders in

 

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accordance with their respective Applicable Percentages but only to the extent
the sum of all non-Defaulting Euro Lenders’ Euro Credit Exposures plus such
Defaulting Lender’s Euro Swingline Exposure and Euro LC Exposure does not exceed
the total of all non-Defaulting Euro Lenders’ Euro Commitments; and (C) all or
any part of the Canadian LC Exposure of such Defaulting Lender, if any, shall be
reallocated among the non-Defaulting Canadian Lenders in accordance with their
respective Applicable Percentages but only to the extent the sum of all
non-Defaulting Canadian Lenders’ Canadian Credit Exposures plus such Defaulting
Lender’s Canadian LC Exposure does not exceed the total of all non-Defaulting
Canadian Lenders’ Canadian Commitments; provided that each such reallocation
shall be given effect only if, at the date the applicable Lender became a
Defaulting Lender, no Default or Event of Default exists;

 

(ii)           if the reallocation described in clause (i) above cannot, or can
only partially, be effected, the Parent shall within one Business Day following
notice by the US Administrative Agent (x) first, prepay such Swingline Exposure
and (y) second, cash collateralize for the benefit of each Issuing Lender only
the Borrowers’ obligations corresponding to such Defaulting Lender’s LC Exposure
(after giving effect to any partial reallocation pursuant to clause (i) above)
in accordance with the procedures set forth in Section 2.05(j) for so long as
such LC Exposure is outstanding;

 

(iii)          if the Parent cash collateralizes any portion of such Defaulting
Lender’s LC Exposure pursuant to clause (ii) above, the Borrowers shall not be
required to pay any fees to such Defaulting Lender pursuant to Section 2.11(b),
(d) and/or (f), as applicable, with respect to such Defaulting Lender’s LC
Exposure during the period such Defaulting Lender’s LC Exposure is cash
collateralized;

 

(iv)          if the LC Exposure of the non-Defaulting Lenders is reallocated
pursuant to clause (i) above, then the fees payable to the Lenders pursuant to
Section 2.11(a) through (f), as applicable, shall be adjusted in accordance with
such non-Defaulting Lenders’ Applicable Percentages; and

 

(v)           if all or any portion of such Defaulting Lender’s LC Exposure is
neither reallocated nor cash collateralized pursuant to clause (i) or
(ii) above, then, without prejudice to any rights or remedies of any Issuing
Lender or any other Lender hereunder, all facility fees that otherwise would
have been payable to such Defaulting Lender (solely with respect to the portion
of such Defaulting Lender’s Commitment that was utilized by such LC Exposure)
and letter of credit fees payable under Section 2.11(b), (d) and/or (f), as
applicable, with respect to such Defaulting Lender’s LC Exposure shall be
payable to the relevant Issuing Lenders until and to the extent that such LC
Exposure is reallocated and/or cash collateralized; and

 

(d)           so long as such Lender is a Defaulting Lender, (A) the US
Swingline Lender shall not be required to fund any US Swingline Loan and the US
Issuing Lender shall not be required to issue, amend or increase any US Letter
of Credit, unless it is satisfied that the related exposure and the Defaulting
Lender’s then outstanding US LC Exposure will be 100% covered by the US
Commitments of the non-Defaulting US Lenders and/or cash collateral will be
provided by the Parent in accordance with Section 2.20(c), and participating
interests in any newly made US Swingline Loan or any newly issued or increased
US Letter of Credit shall be allocated among non-Defaulting US Lenders in a
manner consistent with Section 2.20(c)(i) (and such Defaulting

 

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Lender shall not participate therein); (B) the Euro Swingline Lender shall not
be required to fund any Euro Swingline Loan and the Euro Issuing Lender shall
not be required to issue, amend or increase any Euro Letter of Credit, unless it
is satisfied that the related exposure and the Defaulting Lender’s then
outstanding Euro LC Exposure will be 100% covered by the Euro Commitments of the
non-Defaulting Euro Lenders and/or cash collateral will be provided by the
Parent in accordance with Section 2.20(c), and participating interests in any
newly made Euro Swingline Loan or any newly issued or increased Euro Letter of
Credit shall be allocated among non-Defaulting Euro Lenders in a manner
consistent with Section 2.20(c)(i) (and such Defaulting Lender shall not
participate therein); and (C) the Canadian Issuing Lender shall not be required
to issue, amend or increase any Canadian Letter of Credit, unless it is
satisfied that the related exposure and the Defaulting Lender’s then outstanding
Canadian LC Exposure will be 100% covered by the Canadian Commitments of the
non-Defaulting Canadian Lenders and/or cash collateral will be provided by the
Parent in accordance with Section 2.20(c), and participating interests in any
newly issued or increased Canadian Letter of Credit shall be allocated among
non-Defaulting Canadian Lenders in a manner consistent with
Section 2.20(c)(i) (and such Defaulting Lender shall not participate therein).

 

If (i) a Bankruptcy Event with respect to a Lender Parent shall occur following
the Effective Date and for so long as such event shall continue or (ii) any
Swingline Lender or Issuing Lender has a good faith belief that any Lender has
defaulted in fulfilling its obligations under one or more other agreements in
which such Lender commits to extend credit, such Swingline Lender shall not be
required to fund any Swingline Loan and such Issuing Bank shall not be required
to issue, amend or increase any Letter of Credit, unless such Swingline Lender
or such Issuing Bank, as the case may be, shall have entered into arrangements
with the Parent or such Lender, satisfactory to such Swingline Lender or Issuing
Bank, as the case may be, to defease any risk to it in respect of such Lender
hereunder.

 

In the event that the US Administrative Agent, the Parent, the Swingline Lenders
and the Issuing Lenders each agrees that a Defaulting Lender has adequately
remedied all matters that caused such Lender to be a Defaulting Lender, then the
Swingline Exposure and LC Exposure of the Lenders shall be readjusted to reflect
the inclusion of such Lender’s Commitment and on such date such Lender shall
purchase at par such of the Loans of the other Lenders (other than Swingline
Loans) as the US Administrative Agent shall determine may be necessary in order
for such Lender to hold such Loans in accordance with its Applicable Percentage.

 

ARTICLE III

Representations and Warranties

 

The Borrowers for themselves and their respective Subsidiaries represent and
warrant to the Agents and the Lenders that:

 

Section 3.01          Organization.  Except as set forth on Schedule 3.01, each
Obligor and its respective Subsidiaries (with respect to any Foreign Obligor or
Foreign Subsidiary, only to the extent applicable) (i) is duly organized,
validly existing and, with respect to each Obligor other than any Foreign
Subsidiary, in good standing under the Laws of the jurisdiction of its
organization, (ii) has the requisite power and authority to conduct its business
as it is presently

 

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being conducted, and (iii) is duly qualified or licensed to conduct business and
is in good standing in each jurisdiction where such qualification or good
standing is required, except where the failure to so qualify or be in good
standing could not reasonably be expected to result in a Material Adverse
Effect.

 

Section 3.02          Authority Relative to this Agreement.  Each Obligor has
the power and authority to execute and deliver this Agreement and the other Loan
Documents to which it is a party and to perform its obligations hereunder and
thereunder.  The Transactions have been duly authorized by all necessary
corporate or other entity action, as applicable, on the part of each Obligor
that is a party hereto or thereto.  This Agreement and the other Loan Documents
have been duly and validly executed and delivered by each Obligor party hereto
or thereto and constitute the legal, valid and binding obligations of such
Obligor, enforceable against such Obligor in accordance with their respective
terms, subject to the effect of any applicable bankruptcy, insolvency,
reorganization, moratorium or other Laws affecting creditors’ rights and
remedies generally and to the effect of general principles of equity (regardless
of whether enforcement is considered in a proceeding at Law or in equity).

 

Section 3.03          No Violation.  Except as set forth on Schedule 3.03, the
Transactions will not:

 

(a)           result in a breach of the articles or certificate of
incorporation, bylaws, partnership agreement, limited liability company
agreement or other organization documents, as applicable, of any Obligor or any
of its respective Subsidiaries;

 

(b)           result in the imposition of any Lien on any asset of any Obligor
or any of its respective Subsidiaries (including the Equity Interests of any of
the Subsidiaries of the Borrowers), other than the Liens created under the Loan
Documents;

 

(c)           result in, or constitute an event that, with the passage of time
or giving of notice or both, would be, a breach, violation or default (or give
rise to any right of termination, cancellation, prepayment or acceleration)
under (i) any agreement to which any Obligor or any of its respective
Subsidiaries is a party, under which any Obligor or any of its respective
Subsidiaries has or may acquire rights or obligations or by which its respective
properties or assets may be bound or (ii) any Governmental Approval held by, or
required for the conduct of the business of, any Obligor or any of its
respective Subsidiaries, in each case of (i) and (ii) above, where such breach,
violation or default could reasonably be expected to result in a Material
Adverse Effect;

 

(d)           require any Obligor or any of its respective Subsidiaries to
obtain any consent, waiver, approval, exemption, authorization or other action
of, or make any filing with or give any notice to, any Person except (i) such as
have been obtained or made and are in full force and effect or waived,
(ii) filings necessary to perfect or assign Liens created under the Loan
Documents or (iii) filing of this Agreement and one or more other Loan Documents
with the Securities and Exchange Commission on the appropriate form; or

 

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(e)                                  violate any Law or Order applicable to any
Obligor or any of its respective Subsidiaries or by which any of their
respective properties or assets may be bound, where such violation could
reasonably be expected to result in a Material Adverse Effect.

 

Section 3.04                             Financial Statements.  The Parent has
previously furnished to the US Administrative Agent the following financial
statements (collectively, the “Financial Statements”):  (i) the audited
consolidated balance sheet of the Parent as of December 31, 2010, and the
related consolidated statements of operations, stockholders’ equity and cash
flows for the fiscal year then ended, the notes accompanying such Financial
Statements, and the report of Ernst & Young LLP, independent certified public
accountants, and (ii) the unaudited consolidated balance sheet of the Parent as
of September 30, 2011, and the related statements of operations, stockholders’
equity and cash flows for the period then ended.  The Financial Statements
fairly present in all material respects the consolidated financial position of
the Parent as of their respective dates and the consolidated results of
operations and cash flows of the Parent for the periods ended on such dates in
accordance with GAAP, subject, in the case of interim financial statements, to
absence of footnotes and year-end audit adjustments (the effect of which will
not, individually or in the aggregate, have a Material Adverse Effect).  Since
December 31, 2010, there has been no material adverse change in the Parent’s
consolidated financial position that could reasonably be expected to result in a
Material Adverse Effect.

 

Section 3.05                             No Undisclosed Liabilities.  Except as
set forth in Schedule 3.05, none of the Obligors or any of their respective
Subsidiaries has any liabilities or obligations of any nature (whether known or
unknown, and whether absolute, accrued, contingent or otherwise) except for
(i) liabilities or obligations reflected or reserved against in the financial
statements most recently delivered by the Parent pursuant to Section 4.01(g) or
Section 5.01, as applicable, (ii) current liabilities or obligations incurred in
the ordinary course of business since the date of such financial statements,
(iii) liabilities or obligations that are not required to be included in
financial statements prepared in accordance with GAAP, (iv) liabilities or
obligations arising under Governmental Approvals or contracts to which any
Obligor or any of its respective Subsidiaries is a party or otherwise subject,
(v) liabilities or obligations that could not reasonably be expected to result
in a Material Adverse Effect and (vi) other Permitted Indebtedness.

 

Section 3.06                             Litigation.  Schedule 3.06 briefly
describes each action, suit or proceeding pending before any Governmental
Authority or arbitration panel, or to the knowledge of the Borrowers,
threatened, (i) which seeks to prevent, enjoin or delay any of the Transactions,
or (ii) against any Obligor or any of its respective Subsidiaries regarding the
business of, or assets owned or used by, any of them as to which there is a
reasonable possibility of an adverse determination and that, if adversely
determined, individually or in the aggregate, could reasonably be expected to
have a Material Adverse Effect.

 

Section 3.07                             Compliance with Law.  Except as set
forth on Schedule 3.07, (i) each Obligor and its respective Subsidiaries is in
compliance with each Law that is applicable to it or to the conduct or operation
of its business or the ownership or use of any of its assets, except where the
failure to be in compliance, either individually or in the aggregate, could not
reasonably be expected to result in a Material Adverse Effect; and (ii) none of
the Obligors or any of their respective Subsidiaries has received any notice of,
nor does any Borrower have

 

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knowledge of, the assertion by any Governmental Authority or other Person of any
such failure to be in compliance.

 

Section 3.08                             Material Contracts.  Schedule 3.08
lists as of the Effective Date each Material Contract to which any Obligor or
any of its respective Subsidiaries is a party.  Except as set forth in Schedule
3.08, (i) none of the Borrowers is aware of any pending or threatened
termination or cancellation of any of Material Contract or any notice of any
assertion by any party thereto of any material default thereunder, (ii) none of
the Obligors or any of their respective Subsidiaries nor, to the knowledge of
any of the Borrowers, any other party to a Material Contract is in default of
any material obligation thereunder, and (iii) no other event has occurred and no
other condition exists that, with notice or lapse of time or both, would
constitute a default by any Obligor or any of its respect Subsidiaries or, to
any of the Borrowers’ knowledge, any other party under any Material Contract, in
each case of (i), (ii) and (iii) above, which could reasonably be expected to
result in a Material Adverse Effect.

 

Section 3.09                             Properties.  Schedule 3.09 lists as of
the Effective Date each interest in (i) real property owned by the Parent and
(ii) real property leased or otherwise occupied or used by the Parent as a
lessee or licensee.  Each of the Obligors and its respective Subsidiaries owns
(with good and marketable title in the case of real property, subject only to
the matters permitted by the following sentence), or has valid leasehold
interests or licenses in, all the properties and assets (whether real, personal,
or mixed and whether tangible or intangible) material to its respective
businesses.  All such properties and assets are free and clear of all Liens,
except Permitted Liens, and are not, in the case of real property, subject to
any rights of way, building use restrictions, exceptions, variances,
reservations, or limitations of any nature.  All such properties (i) are in good
operating order, condition and repair (ordinary wear and tear excepted), as
applicable, and (ii) constitute all of the property that is required for the
respective business and operations of the Obligors and their respective
Subsidiaries as presently conducted.

 

Section 3.10                             Intellectual Property.

 

(a)                                 Schedule 3.10 lists as of the Effective Date
all material patents, patent applications, registered trademarks, trademark
applications, registered trade names, registered service marks, and registered
copyrights (the “Intellectual Property”) owned by or licensed to the Parent or
any of its Domestic Subsidiaries.  As of the Effective Date, none of the
Intellectual Property owned by or licensed to any Obligor or its respective
Subsidiaries has been declared invalid or is the subject of a pending or, to the
knowledge of the Borrowers, threatened action for cancellation or a declaration
of invalidity, and there is no pending judicial proceeding involving any claim,
and none of the Obligors or any of their respective Subsidiaries has received
any written notice or claim of any infringement, misuse or misappropriation by
any Obligor or any of its respective Subsidiaries of any Intellectual Property
right owned by any third party, in each case except for any such declaration,
cancellation, proceeding, infringement, misuse or misappropriation which could
not reasonable be expected to result in a Material Adverse Effect.

 

(b)                                 To the Borrowers’ knowledge, except as set
forth in Schedule 3.10, the conduct by any of the Obligors or any of their
respective Subsidiaries of their respective businesses as presently conducted
does not conflict with, infringe on, or otherwise violate any copyright, trade

 

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secret, or patent rights of any Person, except where such conflict, infringement
or violation could not reasonably be expected to have a Material Adverse Effect.

 

Section 3.11                             Taxes.  All Tax returns and reports of
any of the Obligors and their respective Subsidiaries required to be filed by
any of them have been timely filed, and all Taxes shown on such Tax returns and
reports to be due and payable and all assessments, fees and other governmental
charges upon any of them and upon any of their respective properties, assets,
income, businesses and franchises that are due and payable have been paid when
due and payable except to the extent being actively contested by any of them in
good faith and by appropriate proceedings or, with respect to any Subsidiary
that is not a Wholly Owned Subsidiary, except to the extent any failure to so
file and pay would not result in a Material Adverse Effect; provided that such
reserves or other appropriate provisions, if any, as shall be required in
conformity with GAAP shall have been made or provided therefore.  As of the
Effective Date, no Borrower knows of any proposed Tax assessment against any of
the Obligors or any of their respective Subsidiaries that is not being actively
contested by any of them in good faith and by appropriate proceedings; provided
that such reserves or other appropriate provisions, if any, as shall be required
in conformity with GAAP shall have been made or provided therefor, which
assessment could reasonably be expected to result in a Material Adverse Effect.

 

Section 3.12                             Environmental Compliance.  In each
case, except to the extent such condition or event, individually or in the
aggregate, could not reasonably be expected to result in a Material Adverse
Effect and except as set forth in Schedule 3.12,

 

(a)                                 none of the Obligors or any of their
respective Subsidiaries has failed to comply with any Environmental Law or to
obtain, maintain or comply with any Governmental Approval required under any
Environmental Law or has become subject to any Environmental Liability;

 

(b)                                 none of the Obligors or any of their
respective Subsidiaries has received any notice of any claim with respect to any
such Environmental Liability and the Parent does not know of any basis for any
such Environmental Liability;

 

(c)                                  none of the Obligors or any of their
respective Subsidiaries has arranged for the disposal of Hazardous Material at a
site listed for investigation or clean-up by any Governmental Authority or in
violation of Law;

 

(d)                                 there is no proceeding pending against any
of the Obligors or any of their respective Subsidiaries by any Governmental
Authority with respect to the presence on or release of any Hazardous Material
from any real property or facility owned or operated at any time by any of them
or otherwise used in connection with their respective businesses;

 

(e)                                  the Parent has no knowledge that any
Hazardous Material has been or is currently being generated, processed, stored
or released (or is subject to a threatened Release) from, on or under any real
property or facility owned or operated by any of the Obligors or any of their
respective Subsidiaries, or otherwise used in connection with their respective
businesses in a quantity or concentration that would require remedial action
under any Environmental Law if reported to or discovered by the relevant
Governmental Authority; and

 

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(f)                                   to the knowledge of the Parent, there has
been no underground storage tank located at any facility owned or operated by
any of the Obligors or any of their respective Subsidiaries at any time.

 

Section 3.13                             Labor Matters.  As of the Effective
Date, there are no strikes, lockouts or slowdowns against any of the Obligors or
any of their respective Subsidiaries pending or, to the knowledge of the
Borrowers, threatened.  The hours worked by and payments made to employees of
the Parent have not been in violation of the Fair Labor Standards Act or any
other Law dealing with such matters.  All payments due from any of the Obligors
or any of their respective Subsidiaries, or for which any claim may be made
against any of them, on account of wages and employee health and welfare
insurance and other benefits, have been paid or accrued as a liability on the
books of any of the Obligors or any of their respective Subsidiaries.  The
consummation of the Transactions will not give rise to any right of termination
or right of renegotiation on the part of any union under any collective
bargaining agreement to which any of the Obligors or any of their respective
Subsidiaries is bound.

 

Section 3.14                             Investment and Holding Company Status. 
Neither the Parent nor any of its Subsidiaries is an “investment company” as
defined in, or subject to regulation under, the Investment Company Act of 1940,
as amended.

 

Section 3.15                             Insurance.  As of the Effective Date,
Schedule 3.15 lists all policies or binders of fire, liability, worker’s
compensation, vehicular or other insurance held by or for the benefit of the
Parent (specifying the insurer, the policy number or covering note number with
respect to binders).  All insurance held by or for the benefit of the any of the
Obligors or any of their respective Subsidiaries is in full force and effect, is
with financially sound and reputable insurers and is in amounts and provides
coverage that are reasonable and customary for Persons engaged in businesses
similar to those conducted by any of the Obligors or any of their respective
Subsidiaries.

 

Section 3.16                             Solvency.  Immediately after the
consummation of the Transactions to occur on the Effective Date, and immediately
following the making of each Loan and after giving effect to the application of
the proceeds of each Loan, (a) the fair market value of the assets of each
Obligor will exceed its debts and liabilities; (b) the present fair saleable
value of the property of each Obligor will be greater than the amount that will
be required to pay the probable liability of its debts and other liabilities;
(c) each Obligor will be able to pay its debts and liabilities as they become
absolute and mature; and (d) no Obligor will have unreasonably small capital
with which to conduct its business as such business is now conducted and is
proposed to be conducted following the Effective Date.

 

Section 3.17                             ERISA.  No ERISA Event has occurred or
is reasonably expected to occur that, when taken together with all other such
ERISA Events for which liability is reasonably expected to occur, could
reasonably be expected to result in a Material Adverse Effect.

 

Section 3.18                             Disclosure.  The Borrowers have
disclosed to the Lenders all factual matters of which the senior executive
officers of the Borrowers have actual knowledge (other than general industry and
economic conditions and legal and regulatory requirements applicable to
companies and businesses similar to the members generally), that, individually
or in the

 

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aggregate, could reasonably be expected to result in a Material Adverse Effect. 
Neither the Information Memorandum nor the other reports, financial statements,
certificates or other information furnished by or on behalf of any Obligor to
the Agents or any Lender in connection with the negotiation of this Agreement or
delivered hereunder (as modified or supplemented by other information so
furnished) contained, as of the date furnished, any material misstatement of
fact or omitted to state any material fact necessary to make the statements
therein, taken as a whole, in the light of the circumstances under which they
were made, not materially misleading; provided that, with respect to projected
financial information, the Borrowers represent only that such information was
prepared in good faith based upon assumptions believed to be reasonable at the
time (it being understood that no assurance has been given or will be given that
any projected financial information and other projections and forward-looking
information have been or will be achieved).

 

Section 3.19                             Margin Stock.  No part of any Borrowing
or any Swingline Loan shall be used at any time, to purchase or carry margin
stock (within the meaning of Regulation U) or to extend credit to others for the
purpose of purchasing or carrying any margin stock.  None of the Borrowers nor
any of their Subsidiaries are engaged principally, or as one of its important
activities, in the business of extending credit for the purposes of purchasing
or carrying any such margin stock.  No part of the proceeds of any Borrowing
will be used for any purpose which violates, or which is inconsistent with, any
regulations promulgated by the Board of Governors of the Federal Reserve System.

 

ARTICLE IV

 

Conditions

 

Section 4.01                             Effective Date.  The obligations of the
Lenders to make Loans and of the Issuing Lenders to issue Letters of Credit
hereunder shall not become effective until the date on which each of the
following conditions is satisfied (or waived in accordance with Section 10.02):

 

(a)                                 The US Administrative Agent (or its counsel)
shall have received from each party hereto either (i) a counterpart of this
Agreement signed on behalf of such party or (ii) written evidence satisfactory
to the US Administrative Agent (which may include facsimile or email
transmission of a signed signature page of this Agreement) that such party has
signed a counterpart of this Agreement.

 

(b)                                 The US Administrative Agent (or its counsel)
shall have received each of the Security Documents or ratification agreements
with respect thereto from each applicable Obligor and same shall constitute
satisfactory security documentation to create or maintain, as applicable, first
priority security interests in the Collateral free and clear of all Liens, other
than Permitted Liens, including, without limitation, (i) duly executed
modifications to the Mortgages reflecting the Termination Date, as amended and
restated by this Agreement, and (ii) a security and pledge agreement executed by
DYNAenergetics Canada, in each case, in form and substance reasonably
satisfactory to the US Administrative Agent;

 

(c)                                  The US Administrative Agent shall have
received such documents and certificates as the Agents or their counsel may
reasonably request relating to the organization, existence and,

 

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where applicable, good standing of each Obligor, the authorization of the
Transactions, the authority of each natural Person executing any of the Loan
Documents on behalf of any Obligor and any other legal matters relating to the
Obligors, this Agreement or the Transactions, all in form and substance
reasonably satisfactory to the US Administrative Agent and its counsel.

 

(d)                                 Each Lender requesting a promissory note
evidencing Loans made by such Lender shall have received from the applicable
Borrower a promissory note payable to such Lender in a form approved by the US
Administrative Agent in its sole discretion.

 

(e)                                  The Agents shall have received all fees and
other amounts due and payable on or prior to the Effective Date, and to the
extent invoiced, reimbursement or payment of all out-of-pocket expenses required
to be reimbursed or paid by any Borrower hereunder.

 

(f)                                   All material governmental and third party
approvals and permits necessary in connection with the Transactions and the
continued operations of the Obligors shall have been obtained and be in full
force and effect and copies thereof shall have been provided to the US
Administrative Agent (or its counsel).

 

(g)                                  The Lenders shall have received (i) audited
consolidated financial statements of the Parent for the two most recent fiscal
years of the Parent ended prior to the Effective Date and (ii) unaudited interim
consolidated financial statements of the Parent for each quarterly period ended
subsequent to the date of the latest financial statements delivered pursuant to
clause (i) of this subsection (g) as to which such financial statements are
available, in each case reasonably satisfactory to the US Administrative Agent.

 

(h)                                 The US Administrative Agent shall have
received a favorable written opinion (addressed to the Agents and the Lenders
and dated the Effective Date) of (i) Holme Roberts & Owen LLP, counsel for the
Borrowers, covering such matters as the US Administrative Agent shall reasonably
request, (ii) Canadian counsel to DYNAenergetics Canada concerning the authority
of DYNAenergetics Canada to enter into this Agreement and such other matters as
the US Administrative Agent shall reasonably request, including, without
limitation, the perfection of the Lien of the US Administrative Agent in
substantially all of the assets of DYNAenergetics Canada and (iii) French,
German and Luxembourg counsel to the Borrowers concerning the authority of the
Euro Borrowers and Foreign Guarantors (other than DYNAenergetics Canada and
Nitro Metall AB) to enter into the Transactions and such other matters as the US
Administrative Agent shall reasonably request.  The Borrowers hereby request
such counsels to deliver such opinions.

 

(i)                                     The US Administrative Agent shall have
received reports of UCC, tax and judgment Lien searches or other similar
searches conducted by a reputable search firm with respect to each Borrower and
its respective Subsidiaries in each location requested by the US Administrative
Agent and the information disclosed in such reports shall be satisfactory to the
US Administrative Agent.

 

(j)                                    The Lenders shall have received details
of the legal and capital structure of the Borrowers which shall be reasonably
satisfactory to the Lenders.

 

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(k)                                 All membership and stock certificates, if
any, of each Subsidiary of the Parent described on Annex 3 to the Security
Agreements will be delivered to US Administrative Agent together with, as
appropriate, related stock and membership powers executed in blank by the
relevant Obligor, to the extent such membership and stock certificates and
related stock and membership powers were not previously delivered to the US
Administrative Agent in connection with the Prior Agreement.

 

(l)                                     The Administrative Agent shall have
received the Phase I environmental reports and other environmental information
in the possession of or available to the Parent and covering the Mortgaged
Property, to the extent such reports and information were not previously
delivered to the US Administrative Agent in connection with the Prior Agreement.

 

(m)                             The US Administrative Agent shall have received
a binding commitment from First American Title Insurance Company to issue an
endorsement to each mortgagee’s policy of title insurance covering the Mortgaged
Property stating that said company will not claim that its liability for the
payment of any loss or damage under the terms and provisions of such policy has
been waived or surrendered by the US Administrative Agent or reduced by said
company by reason of the execution of the modification to the Mortgage insured
by such policy and described above in paragraph (b).

 

(n)                                 The US Administrative Agent shall have
received evidence of insurance coverage of each Borrower and its Subsidiaries
satisfying the requirements of Section 5.05(b); the US Administrative Agent
shall have been named as an additional insured and as a mortgagee/loss payee on
the liability and casualty insurance policies covering the Mortgaged Property.

 

(o)                                 The US Administrative Agent shall have
received all documents and other items that it may reasonably request relating
to any other matters relevant hereto, all in form and substance reasonably
satisfactory to the US Administrative Agent.

 

Section 4.02                             Each Credit Event.  The obligation of
each Lender to make a Loan on the occasion of any Borrowing, and of each Issuing
Lender to issue, amend, renew or extend any Letter of Credit, is subject to the
satisfaction of the following conditions:

 

(a)                                 The representations and warranties of each
Obligor set forth in this Agreement or any other Loan Document shall be true and
correct in all material respects on and as of the date of such Borrowing or the
date of issuance, amendment, renewal or extension of such Letter of Credit;
provided, that to the extent any such representation and warranty was made as of
a specific date, such representation and warranty shall be true and correct in
all material respects as of such specific date.

 

(b)                                 No Material Adverse Effect shall have
occurred since the date of the most recent Borrowing.

 

(c)                                  The Applicable Agent shall have received a
request for a Borrowing as required by Section 2.03 or the Applicable Issuing
Lender and the Applicable Agent shall have received a request for the issuance
of a Letter of Credit as required by Section 2.05(b).

 

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(d)                                 At the time of and immediately after giving
effect to such Borrowing or the issuance, amendment, renewal or extension of
such Letter of Credit, no Default or Event of Default shall have occurred and be
continuing.

 

Each Borrowing and each issuance, amendment, renewal or extension of a Letter of
Credit shall be deemed to constitute a representation and warranty by the
relevant Obligors on the date thereof as to the matters specified in paragraphs
(a) and (c) of this Section 4.02.

 

ARTICLE V

 

Affirmative Covenants

 

Until the Commitments have expired or been terminated and the principal of and
interest on each Loan and all fees payable hereunder shall have been paid in
full and all Letters of Credit shall have expired or terminated and all LC
Disbursements shall have been reimbursed:

 

Section 5.01                             Financial Statements and Other
Information.  The Parent will furnish to the US Administrative Agent:

 

(a)                                 on or before the last day of the third month
after the end of each fiscal year of the Parent, the audited consolidated
balance sheet and related statements of operations, cash flows and shareholders’
equity as of the end of and for such year of the Parent, setting forth in each
case in comparative form the figures for the previous fiscal year, all reported
on by independent public accountants of recognized national standing (without a
“going concern” or like qualification or exception and without any qualification
or exception as to the scope of such audit) to the effect that such consolidated
financial statements present fairly in all material respects the financial
condition and results of operations of the Parent and its Subsidiaries on a
consolidated basis in accordance with GAAP consistently applied;

 

(b)                                 on or before the 15th day of the second
month after the end of the first three fiscal quarters of each fiscal year of
the Parent, the consolidated balance sheet and related statements of operations,
cash flows and shareholders’ equity as of the end of and for such fiscal quarter
and the then elapsed portion of the fiscal year for the Parent, setting forth in
each case in comparative form the figures for the corresponding period or
periods of (or, in the case of the balance sheet, as of the end of) the previous
fiscal year, all certified by one of the Financial Officers as presenting fairly
in all material respects the financial condition and results of operations of
the Parent and its Subsidiaries on a consolidated basis in accordance with GAAP
consistently applied, subject to normal year-end audit adjustments and the
absence of footnotes;

 

(c)                                  concurrently with any delivery of financial
statements under clause (a) or (b) above, a certificate of a Financial Officer
substantially in the form attached hereto as Exhibit 5.01(c) (a “Compliance
Certificate”) (i) certifying as to whether a Default has occurred and, if a
Default has occurred, specifying the details thereof and any action taken or
proposed to be taken with respect thereto, (ii) setting forth reasonably
detailed calculations demonstrating compliance with Section 6.14 and
Section 6.15 and (iii) stating whether any change in GAAP or in the application
thereof has occurred since the date of the last audited financial statements

 

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delivered pursuant to Section 5.01(a) and, if any such change has occurred,
specifying the effect such change would have on the financial statements
accompanying such certificate;

 

(d)                                 promptly after the same become available,
copies of all periodic and other reports, proxy statements and other materials
filed by the Parent with the Securities and Exchange Commission, or any
Governmental Authority succeeding to any or all of the functions of said
Commission, or with any national securities exchange, as applicable;

 

(e)                                  within 90 days following the commencement
of each fiscal year, the Parent and its Subsidiaries operating and capital
expenditure budgets and cash flow forecast for such fiscal year (which shall
include a projected combined balance sheet summary for the Parent and its
Subsidiaries of the last day of such fiscal year and the related projected
statements of combined income and cash flows for such fiscal year);

 

(f)                                   promptly upon receipt of any complaint,
order, citation, notice or other written communication from any Person with
respect to, or upon any Obligor’s obtaining knowledge of, (i) the existence or
alleged existence of a violation of any applicable Environmental Law or any
Environmental Liability in connection with any property now or previously owned,
leased or operated by the Borrowers or any of their Subsidiaries, (ii) any
release of Hazardous Substances on such property or any part thereof in a
quantity that is reportable under any applicable Environmental Law, and
(iii) any pending or threatened proceeding for the termination, suspension or
non-renewal of any permit required under any applicable Environmental Law, in
each case of clauses (i), (ii) and (iii) above in which there is a reasonable
likelihood of an adverse decision or determination that could reasonably be
expected to result in a Material Adverse Effect, a certificate of an executive
officer of the Parent, setting forth the details of such matter and the actions,
if any, that such Obligor is required or proposes to take;

 

(g)                                  promptly following any request therefor,
such other information regarding the operations, business affairs and financial
condition of the Borrowers or any of their Subsidiaries, or compliance with the
terms of this Agreement, as any Agent or Lender may reasonably request; and

 

(h)                                 within 90 days after the end of each fiscal
year, a report in form and substance reasonably satisfactory to the US
Administrative Agent describing all material insurance coverage maintained by
any of the Obligors or any of their respective Subsidiaries as of the date of
such report.

 

Section 5.02                             Notices of Material Events.  The Parent
will furnish to the US Administrative Agent and each Lender prompt written
notice of the following:

 

(a)                                 the occurrence of any Default and the action
that the Obligors are taking or propose to take with respect thereto;

 

(b)                                 the filing or commencement of any action,
suit or proceeding by or before any arbitrator or Governmental Authority against
any Obligor that could reasonably be expected to result in a Material Adverse
Effect or that in any manner questions the validity of the Loan Documents;

 

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(c)                                  the occurrence of any ERISA Event that,
alone or together with any other ERISA Events that have occurred, could
reasonably be expected to result in a Material Adverse Effect; and

 

(d)                                 any other development that results in, or
could reasonably be expected to result in a Material Adverse Effect.

 

Each notice delivered under this Section shall be accompanied by a statement of
a Financial Officer or other executive officer of the Parent setting forth the
details of the event or development requiring such notice and any action, if
any, taken or proposed to be taken with respect thereto.

 

Section 5.03                             Existence; Conduct of Business.  Each
Borrower will, and will cause each of its respective Subsidiaries to, do or
cause to be done all things necessary to preserve, renew and keep in full force
and effect its legal existence and the rights, licenses, permits, privileges and
franchises material to the conduct of its business except to the extent failure
to maintain or preserve could not reasonably be expected to result in a Material
Adverse Effect; provided that the foregoing shall not prohibit any merger,
consolidation, liquidation or dissolution permitted under Section 6.04.

 

Section 5.04                             Payment of Obligations.  Each Borrower
will, and will cause each of its respective Subsidiaries to, pay when due its
material obligations, including liabilities for Taxes, except where (a) the
validity or amount thereof is being contested in good faith by appropriate
proceedings, (b) it has set aside on its books adequate reserves with respect
thereto in accordance with GAAP and (c) the failure to make payment pending such
contest could not reasonably be expected to result in a Material Adverse Effect.

 

Section 5.05                             Maintenance of Properties; Insurance. 
Each Borrower will, and will cause each of its respective Subsidiaries to,
(a) keep and maintain all property material to the conduct of its business in
good working order and condition, ordinary wear and tear excepted, and
(b) maintain, with financially sound and reputable insurance companies,
insurance in such amounts and against such risks as are customarily maintained
by companies engaged in the same or similar businesses operating in the same or
similar locations.

 

Section 5.06                             Books and Records; Inspection Rights. 
Each Borrower will, and will cause each of its respective Subsidiaries to, keep
proper books of record and account in which in all material respects full, true
and correct entries are made of all dealings and transactions in relation to its
business and activities.  Each Borrower will, and will cause each of its
respective Subsidiaries to, permit any representatives designated by the US
Administrative Agent, upon reasonable prior notice, to visit and inspect its
properties, to examine and make extracts from its books and records, and to
discuss its affairs, finances and condition with its officers and independent
accountants (provided a representative of the Parent shall have the right to be
present), all at such reasonable times and as often as reasonably requested;
provided, that following the Effective Date and so long as no Event of Default
has occurred and is continuing, the Parent shall only be required to reimburse
the US Administrative Agent in accordance with Section 10.03 for the cost of one
such inspection in any fiscal year.

 

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Section 5.07                             Compliance with Laws.  Each Borrower
will, and will cause each of its respective Subsidiaries to, comply with all
Laws (including Environmental Laws) and Orders applicable to it or its property,
except where the failure to do so, individually or in the aggregate, could not
reasonably be expected to result in a Material Adverse Effect.

 

Section 5.08                             Use of Proceeds and Letters of Credit. 
Each Borrower covenants and agrees that the proceeds of the Loans it receives
will be used only to (i) refinance existing Indebtedness; (ii) pay the fees,
expenses and other transaction costs of the Transactions; and (iii) fund working
capital needs and general corporate purposes of such Borrower and its
Subsidiaries.  Each Borrower covenants and agrees that no part of the proceeds
of any Loan it receives will be used, whether directly or indirectly, for any
purpose that entails a violation of any of the Regulations of the Board,
including Regulations T, U and X.  Letters of Credit will be issued only to
support the working capital needs and general corporate obligations of the
applicable Borrower and its Subsidiaries relating to their respective lines of
business as currently conducted.

 

Section 5.09                             Additional Guarantees and Security
Documents.  If any additional Wholly Owned Subsidiary of the Parent is formed or
acquired after the Effective Date, the Parent will promptly notify the US
Administrative Agent thereof and

 

(a)                                 if such Subsidiary is a Domestic Subsidiary,
within 30 days after such Subsidiary is formed or acquired, the Parent shall
cause (i) any such Domestic Subsidiary the assets of which are all or
substantially all comprised of stock or securities in one or more Foreign
Subsidiaries to execute a Joinder Agreement for purposes of such Subsidiary
becoming a US Guarantor under Section 9.01(a)(i) hereunder and a party to the
relevant Security Documents, which Security Documents secure the Obligations of
the Euro Borrowers and the Canadian Borrowers and deliver to the US
Administrative Agent such other documents relating thereto as the US
Administrative Agent shall reasonably request, (ii) any such Domestic Subsidiary
the assets of which are not all or substantially all comprised of stock or
securities in one or more Foreign Subsidiaries to execute a Joinder Agreement
for purposes of such Subsidiary becoming a US Guarantor under
Section 9.01(a)(ii) hereunder and a party to the relevant Security Documents,
which Security Documents secure the Obligations of the US Borrowers, the Euro
Borrowers and the Canadian Borrowers and deliver to the US Administrative Agent
such other documents relating thereto as the US Administrative Agent shall
reasonably request, (iii) the Equity Interests issued by any such Subsidiary
described in clause (a)(i) above representing 65% of the total combined voting
power (within the meaning of Treasury Regulation Section 1.956-2(c)(2)) of all
of the Equity Interests in such Subsidiary to be pledged to secure the
Obligations of the US Borrowers, the Euro Borrowers and the Canadian Borrowers
pursuant to the relevant Security Documents and (iv) all of the Equity Interests
issued by any such Subsidiary described in clause (a)(ii) to be pledged to
secure the Obligations of the US Borrowers, the Euro Borrowers and the Canadian
Borrowers pursuant to the relevant Security Documents;

 

(b)                                 if such Subsidiary is a Foreign Subsidiary
that is owned by a Domestic Subsidiary or by the Parent, within 45 days after
such Subsidiary is formed or acquired, the Parent shall cause (i) such
Subsidiary to execute a Joinder Agreement for purposes of such Subsidiary
becoming a Foreign Guarantor hereunder and deliver to the US Administrative
Agent such other documents relating thereto as the US Administrative Agent shall
reasonably request and (ii) the

 

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Equity Interests issued by such Subsidiary representing 65% of the total
combined voting power (within the meaning of Treasury Regulation Section
1.956-2(c)(2)) of all of the Equity Interests in such Subsidiary to be pledged
to secure the Obligations of the US Borrowers pursuant to the relevant Security
Documents; and

 

(c)                                  if such Subsidiary is a Foreign Subsidiary
owned by a Foreign Subsidiary, within 45 days after such Subsidiary is formed or
acquired, such Foreign Subsidiary shall cause (i) such Subsidiary to execute a
Joinder Agreement for purposes of such Subsidiary becoming a Foreign Guarantor
hereunder and deliver to the US Administrative Agent such other documents
relating thereto as the US Administrative Agent shall reasonably request and
(ii) all of the Equity Interests issued by such Subsidiary to be pledged to
secure the Obligations of the Euro Borrowers and the Canadian Borrowers pursuant
to the relevant Security Documents.

 

(d)                                 The intent of the parties under this
Agreement is that no Foreign Subsidiary or Domestic Subsidiary all or
substantially all of the assets of which consist of stock or securities in one
or more Foreign Subsidiaries shall be treated as a pledgor or guarantor with
respect to the Loans or any Obligations of the US Borrowers for purposes of Code
Section 956(d) and Treasury Regulation Section 1.956-2(c), and that the
provisions of this Agreement shall be interpreted in a manner consistent with
that intent.  Notwithstanding anything to the contrary herein or under any Loan
Documents, no Foreign Subsidiary or Domestic Subsidiary the assets of which are
all or substantially all comprised of stock or securities in one or more Foreign
Subsidiaries shall have any liability whatsoever in respect of any Obligations
of the US Borrowers or any Domestic Subsidiary.

 

Section 5.10                             Compliance with ERISA.  In addition to
and without limiting the generality of Section 5.07, to the extent applicable,
the Parent shall, and shall cause each of its Subsidiaries to, (a) comply in all
material respects with all applicable provisions of ERISA and the regulations
and published interpretations thereunder with respect to all employee benefit
plans (as defined in ERISA), (b) not take any action or fail to take action the
result of which could be (i) a liability to the PBGC (other than liability for
PBGC premiums) or (ii) a past due liability to any Multiemployer Plan, (c) not
participate in any prohibited transaction that could result in any material
civil penalty under ERISA or any tax under the Code, (d) operate each employee
benefit plan in such a manner that will not incur any material tax liability
under Section 4980B of the Code or any liability to any qualified beneficiary as
defined in Section 4980B of the Code, in each case of clauses (a), (b), (c) and
(d) above, except to the extent such failure to comply, such not taking such
action, such failure to take such action, such not participating or such
operating would not reasonably be expected to result in a Material Adverse
Effect and (e) furnish to the US Administrative Agent upon the US Administrative
Agent’s request such additional information about any employee benefit plan as
may be reasonably requested by the US Administrative Agent.

 

Section 5.11                             Compliance with Environmental Laws;
Environmental Reports.

 

(a)                                 Each Borrower shall, and shall cause each of
its respective Subsidiaries to, (i) comply, and use best efforts to cause all
lessees and other persons occupying real property owned, operated or leased by
any of them to comply, in all material respects with all Environmental Laws
applicable to its operations and real property; (ii) obtain and renew all

 

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material Governmental Approvals required under Environmental Laws applicable to
its operations and real property; and conduct any Response in accordance with
Environmental Laws; provided that no Borrower or any of its Subsidiaries shall
be required to undertake any Response to the extent that its obligation to do so
is being contested in good faith and by proper proceedings and appropriate
reserves are being maintained with respect to such circumstances in accordance
with GAAP.

 

(b)                                 If a Default caused by reason of a breach of
Section 3.12 or Section 5.11(a) shall have occurred and be continuing for more
than 10 days without such Borrower or its Subsidiaries commencing activities
reasonably likely to cure such Default, at the written request of the Required
Lenders through the US Administrative Agent, the Parent shall provide to the
Lenders within 30 days after such request, at the expense of the Parent, an
environmental assessment report regarding the matters that are the subject of
such Default, including where appropriate, any soil and/or groundwater sampling,
prepared by an environmental consulting firm and in the form and substance
reasonably acceptable to the US Administrative Agent and indicating the presence
or absence of Hazardous Materials and the estimated cost of any compliance or
Response to address them.

 

Section 5.12                             Maintain Business.  Except as otherwise
permitted hereunder, each Borrower shall, and shall cause each of its respective
Subsidiaries to, continue to engage primarily in the business or businesses
being conducted on the Effective Date and businesses reasonably related thereto
and other reasonable expansions and extensions of such business or businesses.

 

Section 5.13                             Further Assurances and New Intellectual
Property.  Each Obligor will, at its own cost and expense, execute, acknowledge
and deliver all such further acts, documents and assurances as may from time to
time be reasonably necessary or as any Agent or the Required Lenders may from
time to time reasonably request in order to carry out the intent and purposes of
the Loan Documents and the Transactions, including all such actions to
establish, preserve, protect and perfect the estate, right, title and interest
of the Lenders, or the Agents for the benefit of the Lenders, to the Collateral
(including Collateral acquired after the Effective Date).  If any material
trademark, copyright or patent is acquired by the Parent, any other US Borrower
or any US Guarantor after the Effective Date (other than trademarks, copyrights
and patents constituting Collateral under the Security Documents that become
subject to the Lien of the Security Documents upon acquisition thereof), the
Parent shall promptly give notice to the US Administrative Agent thereof, and,
shall cause such assets to be subjected to a Lien securing the Obligations of
the US Borrowers and the Obligations of the Foreign Borrowers.

 

ARTICLE VI

Negative Covenants

 

Until the Commitments have expired or terminated and the principal of and
interest on each Loan and all fees payable hereunder shall have been paid in
full and all Letters of Credit have expired or terminated and all LC
Disbursements shall have been reimbursed:

 

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Section 6.01                             Indebtedness.  No Borrower will, nor
will permit any of its respective Subsidiaries to, create, incur, assume or
permit to exist any Indebtedness, except:

 

(a)                                 Indebtedness created hereunder or under any
of the Loan Documents, including renewals, extensions, refinancings and
replacements hereof or thereof;

 

(b)                                 Indebtedness set forth in Schedule 6.01 and
extensions, renewals, refinancings and replacements of any such Indebtedness
that do not increase the outstanding principal amount thereof;

 

(c)                                  Indebtedness of any Obligor or any of its
respective Subsidiaries incurred to finance the acquisition, construction or
improvement of any assets, including Capital Lease Obligations, and any
Indebtedness assumed or that remains outstanding in connection with the
acquisition of any such assets or secured by a Lien on any such assets prior to
the acquisition thereof, and extensions, renewals and replacements of any such
Indebtedness that do not increase the outstanding principal amount thereof;
provided that the aggregate principal amount of Indebtedness permitted by this
clause (c) shall not exceed $10,000,000 at any time outstanding;

 

(d)                                 Indebtedness owed by any Obligor to any
other Obligor and guarantees by any Obligor of the Indebtedness of any other
Obligor;

 

(e)                                  Indebtedness owed by any Obligor to any of
the Subsidiaries of the Parent that is not an Obligor and guarantees by any
Subsidiary of the Parent that is not an Obligor of any Indebtedness of any
Obligor; provided that such Indebtedness is, and subrogation or reimbursement
rights in respect of such guarantees are, subordinated in right of payment to
the Obligations of such Obligor under the Loan Documents on terms reasonably
acceptable to the US Administrative Agent;

 

(f)                                   Indebtedness owed by any Subsidiary of any
Obligor to any Obligor and guarantees by any Obligor of the Indebtedness of any
such Subsidiary; provided that the principal amount of such Indebtedness and
guarantees together with the principal amount of Indebtedness owed to any
Obligor pursuant to Section 6.01(h) in the aggregate shall be limited to
$10,000,000 at any time outstanding.  Notwithstanding the foregoing, no
additional such Indebtedness shall be incurred and no additional such guarantees
shall be made during the continuance of an Event of Default;

 

(g)                                  Indebtedness owed by any Subsidiary of any
Obligor that is not an Obligor to any other Subsidiary that is not an Obligor
and guarantees by any such Subsidiary of the Indebtedness of any other
Subsidiary that is not an Obligor;

 

(h)                                 Indebtedness of any Subsidiary of any
Obligor to the holders (or their respective Affiliates) of the Equity Interests
in such Subsidiary on a basis that is substantially proportionate to their
Equity Interests (with any disproportionately large interest received by any
Obligor or any of its respective Subsidiaries or any disproportionately small
interest received by any Person other than such Obligor or any such Subsidiary,
being ignored for this purpose); provided that the principal amount of such
Indebtedness owed to any Obligor together with the principal amount of
Indebtedness owed to any Obligor pursuant to Section 6.01(f) shall be limited to

 

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$10,000,000 at any time outstanding.  Notwithstanding the foregoing, no
additional such Indebtedness shall be incurred during the continuance of an
Event of Default;

 

(i)                                     Indebtedness arising in connection with
any Swap Agreement permitted by Section 6.06;

 

(j)                                    Indebtedness in respect of deposits made
by customers and held under forward purchasing arrangements entered into with
customers in the ordinary course of business;

 

(k)                                 Indebtedness in respect of performance, bid,
surety, appeal or similar bonds or completion or performance guarantees provided
in the ordinary course of business;

 

(l)                                     Indebtedness in respect of workers’
compensation claims or self-insurance obligations otherwise permitted hereunder,
in each case incurred in the ordinary course of business;

 

(m)                             customary indemnification, reimbursement or
similar obligations and warranties under leases and other contracts in the
ordinary course of business;

 

(n)                                 Indebtedness arising from the honoring by a
bank or other financial institution of a check, draft or similar instrument
inadvertently (except in the case of daylight overdrafts) drawn against
insufficient funds in the ordinary course of business; provided that such
Indebtedness is extinguished within two Business Days after incurrence;

 

(o)                                 Indebtedness constituting Investments
permitted by Section 6.05;

 

(p)                                 Indebtedness owed by any Obligor or any
Subsidiary of any Obligor to any Lender or any Affiliate of any Lender in
respect of loans in currencies other than US Dollars, Euros or Canadian Dollars
and guarantees of any such Indebtedness by any Foreign Guarantor; provided that
(i) the aggregate principal amount of Indebtedness permitted by this clause
(p) shall not exceed the equivalent amount of $8,000,000 calculated as of the
date such Indebtedness is incurred and (ii) such Lender or such Affiliate and
the US Administrative Agent shall have entered into an intercreditor agreement
in form and substance reasonably satisfactory to the US Administrative Agent;

 

(q)                                 Indebtedness of any Foreign Subsidiary owing
to Commerzbank Aktiengesellschaft in an aggregate principal amount not to exceed
€4,000,000 at any time outstanding; and

 

(r)                                    unsecured Indebtedness in the aggregate
amount not in excess of $8,000,000 outstanding at any time.

 

Section 6.02                             Liens.  No Borrower will, nor will
permit any of its respective Subsidiaries to, create, incur, assume or permit to
exist any Lien on any property or asset now owned or hereafter acquired by it,
or assign or sell any income or revenues (including accounts receivable) or
rights in respect of any thereof, except:

 

(a)                                 Permitted Encumbrances;

 

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(b)                                 Liens created by the Security Documents;

 

(c)                                  Liens to secure Swap Agreements with any of
the Lenders or Affiliate thereof;

 

(d)                                 Liens on any property or asset of any
Borrower or any of its respective Subsidiaries existing on the Effective Date
and set forth in Schedule 6.02; provided that (i) such Liens shall not apply to
any other property or asset of any Borrower or any of such Subsidiaries and
(ii) such Liens shall secure only those obligations which it secures on the
Effective Date and extensions, renewals, refinancings and replacements thereof
that do not increase the outstanding principal amount thereof;

 

(e)                                  Liens on assets acquired, constructed or
improved by any Borrower or any of its respective Subsidiaries; provided that
(i) such Liens secure Indebtedness permitted by clause (c) of Section 6.01,
(ii) such Liens and the Indebtedness secured thereby are incurred prior to or
within 180 days after such acquisition or the completion of such construction or
improvement, (iii) the Indebtedness secured thereby does not exceed 100% of the
cost of acquiring, constructing or improving such assets and (iv) such Liens
shall not apply to any other property or assets of any Borrower or any of its
respective other Subsidiaries;

 

(f)                                   Liens existing on any property or asset
prior to the acquisition thereof by any Borrower or any of its respective
Subsidiaries or existing on any property or asset of any Person that becomes a
Subsidiary after the Effective Date prior to the time such Person becomes a
Subsidiary; provided that (i) such Liens are not created in contemplation of or
in connection with such acquisition or such Person becoming a Subsidiary, as
applicable, (ii) such Liens shall not apply to any other property or assets of
any Borrower or any of its respective other Subsidiaries, (iii) such Liens shall
secure only those obligations which it secures on the date of such acquisition
or the date such Person becomes a Subsidiary, as applicable, and extensions,
renewals, refinancings and replacements thereof that do not increase the
outstanding principal amount thereof and (iv) such Liens secure only
Indebtedness permitted under Section 6.01(c);

 

(g)                                  Liens arising solely by virtue of any
statutory or common law provisions relating to banker’s Liens, rights of
set-off, netting or similar rights and remedies as to deposit, securities and
commodities accounts;

 

(h)                                 Liens of sellers of goods to any Borrower
and any of its Subsidiaries arising under Article 2 of the Uniform Commercial
Code or similar provisions of applicable law in the ordinary course of business
solely in connection with the purchase of such goods;

 

(i)                                     Liens in favor of customs and revenue
authorities arising by operation of law to secure payment of customs duties in
connection with the importation of goods;

 

(j)                                    Liens deemed to exist in connection with
investments in repurchase agreements described under clause (d) of the
definition of Permitted Investments;

 

(k)                                 Liens of a collection bank arising under
Section 4-210 of the Uniform Commercial Code as in effect in the applicable
state or District of Columbia;

 

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(l)                                     Liens in favor of any Obligor securing
Indebtedness permitted under Section 6.01(d) and Section 6.01(f); provided that
any such Liens encumbering assets of an Obligor shall be subordinated in right
of payment to the Obligations of such Obligor under the Loan Documents on terms
reasonably acceptable to the US Administrative Agent;

 

(m)                             Liens arising out of conditional sale, title
retention, consignment or similar arrangements, or by way of contract that
secures Indebtedness under any agreement, for the sale of goods and services;

 

(n)                                 Liens on the Collateral in favor of any
Lender or any Affiliate of any Lender in respect of Indebtedness permitted under
Section 6.01(p); provided that such Liens are pari passu with the Liens securing
the Obligations and subject to the intercreditor agreement described above in
Section 6.01(p);

 

(o)                                 Liens on Equity Interests consisting of
preferred equity certificates of Dynamic Materials Luxembourg 1 S.à r.l. and
Dynamic Materials Luxembourg 2 S.à r.l. that (i) require a holder of common or
ordinary shares of such issuers to hold such preferred equity certificates in a
specified proportion, (ii) require a holder of such preferred equity
certificates to hold common or ordinary shares of such issuers in a specified
proportion, (iii) restrict transfers of such preferred equity certificates,
common shares or ordinary shares of such issuers to transfers that result in
compliance with the preceding clauses (i) and (ii) or (iv) permit such issuers
to call or redeem such Equity Interests; and

 

(p)                                 Liens on the assets of any Foreign
Subsidiary securing Indebtedness permitted under Section 6.01(q), so long as
such assets are not Collateral.

 

Section 6.03                             Fundamental Changes.  No Borrower will,
nor will permit any of its respective Subsidiaries to, merge into or consolidate
with any other Person, or permit any other Person to merge into or consolidate
with it, or liquidate or dissolve, except that, the following shall be permitted
if at the time thereof and immediately after giving effect thereto no Default
shall have occurred and be continuing and, if such transaction involves the
Parent, the Parent shall survive such transaction:

 

(a)                                 any Subsidiary of the Parent may merge into
or consolidate with another Subsidiary of the Parent and any Subsidiary of the
Parent may merge into or consolidate with the Parent;

 

(b)                                 any Subsidiary of the Parent may merge into
or consolidate with any other Person so long as such Subsidiary is the surviving
entity of such merger or consolidation to the extent permitted under
Section 6.10;

 

(c)                                  any Subsidiary of the Parent may liquidate
or dissolve so long as an Obligor acquires all or substantially all of the
assets of such Subsidiary in liquidation (or in the case such Subsidiary is not
a Wholly Owned Subsidiary, such Obligor receives its pro rata share of such
assets in liquidation); and

 

(d)                                 any Obligor or any of its respective
Subsidiaries may change its jurisdiction of organization subject to compliance
with Section 6.11;

 

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provided that, notwithstanding the foregoing, no Subsidiary that is not an
Obligor may merge into or consolidate with any Obligor, unless, if at the time
thereof and immediately after giving effect thereto, no Default has occurred and
is continuing and such Obligor shall survive such transaction.

 

Section 6.04                             Asset Sales.  No Borrower will, nor
will permit any of its respective Subsidiaries to, make or permit any
Disposition (whether in one or a related series of transactions) of any property
or assets (other than cash and cash equivalents) or enter into any agreement to
do so, except:

 

(a)                                 Dispositions of inventory in the ordinary
course of business;

 

(b)                                 Dispositions of assets, properties or
businesses to any Borrower or any of its respective Wholly Owned Subsidiaries
that are Obligors and Dispositions of assets, properties or businesses to any
Subsidiary that is not an Obligor by any Subsidiary that is not an Obligor;

 

(c)                                  Dispositions of equipment and other
property which is obsolete, worn out or no longer used in or useful to such
Person’s business, all in the ordinary course of business;

 

(d)                                 Dispositions occurring as the result of a
casualty event, condemnation or expropriation;

 

(e)                                  any Disposition (excluding any Disposition
consisting of any Equity Interest in any of the Subsidiaries of the Parent) if
(i) the consideration therefor is not less than the fair market value of the
related asset (as determined in good faith by a Financial Officer) and
(ii) after giving effect thereto, the aggregate fair market value of the assets
as reasonably determined by the Parent disposed of in all Dispositions pursuant
to this clause (e) would not exceed $5,000,000 during any fiscal year and
$10,000,000 in the aggregate during the term hereof; provided that the
consideration for any Disposition shall consist of at least 75% cash or cash
equivalents payable at closing or notes, to the extent permitted under
Section 6.05;

 

(f)                                   Dispositions by any Domestic Subsidiary of
its assets to another Domestic Subsidiary that is a Wholly Owned Subsidiary, and
Dispositions by any Foreign Subsidiary of its assets to another Foreign
Subsidiary that is a Wholly Owned Subsidiary;

 

(g)                                  Dispositions of delinquent accounts
receivable in the ordinary course of business for purposes of collection only
(and not for the purpose of any bulk sale or securitization transaction);

 

(h)                                 the surrender of contractual rights or the
settlement, release or surrender of any contract, tort or other litigation
claims in the ordinary course of business;

 

(i)                                     the abandonment or Disposition of
Intellectual Property or other proprietary rights that are, in the reasonable
business judgment of the Parent, no longer practicable to maintain or useful in
the conduct of the business of any Borrower or any of its Subsidiaries;

 

(j)                                    Dispositions permitted by Section 6.03;

 

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(k)                                 Dispositions of Indebtedness from the Parent
to a Subsidiary thereof that is an Obligor or from a Subsidiary of the Parent
that is an Obligor to the Parent or another Subsidiary thereof that is an
Obligor in exchange for, upon conversion for, or in contribution in respect of,
Equity Interests in such Subsidiary of the Parent in connection with the
capitalization or recapitalization from time to time of any such Subsidiary and
Dispositions of Indebtedness from a Subsidiary that is not an Obligor to another
Subsidiary that is not an Obligor in exchange for, upon conversion for, or
contribution in respect of, Equity Interests in such Subsidiary that is not an
Obligor in connection with the capitalization or recapitalization from time to
time of any such Subsidiary;

 

(l)                                     payment of Restricted Payments permitted
by Section 6.07;

 

(m)                             Dispositions of Permitted Investments; and

 

(n)                                 any agreement to do any of the foregoing
matters described in clauses (a) through (m) of this Section.

 

Section 6.05                             Investments.  No Borrower will, and
will permit any of its Subsidiaries to, make or permit to exist any Investment
in any other Person, except:

 

(a)                                 Permitted Investments;

 

(b)                                 Investments listed on Schedule 6.05 and any
extensions, renewals, replacements or refinancings thereof that do not increase
the amount of such Investments;

 

(c)                                  Investments and guarantees constituting
Indebtedness permitted by Section 6.01(d) and Section 6.01(e);

 

(d)                                 Investments permitted by Section 6.03 or
Section 6.06;

 

(e)                                  Business Acquisitions permitted by
Section 6.10;

 

(f)                                   Investments by any Obligor in any
Subsidiary of the Parent that is not an Obligor and in any joint venture that is
not, and will not become, a Subsidiary of the Parent, in each case, that is
engaged or will be engaged in the same business as the Parent and its
Subsidiaries and businesses reasonably related thereto and other reasonable
expansions and extensions of such business and businesses; provided that the
aggregate amount of all Investments permitted under this clause (f) shall be
limited to $20,000,000 outstanding from time to time of which no more than
$15,000,000 may be outstanding in any such joint ventures, in each case,
measured in Dollars at the time made and net of any cash returned to any
Obligor.  For purposes of calculating the permitted Investments under this
clause (f), any such Investments that are in the form of Indebtedness permitted
under Section 6.01(f) and Section 6.01(h) shall be included in the Investments
permitted under this clause (f), without duplication.  Notwithstanding the
foregoing, no additional Investments shall be made pursuant to this clause
(f) during the continuance of an Event of Default;

 

(g)                                  Investments by any Obligor in any other
Obligor;

 

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(h)                                 Investments received in satisfaction of
judgments, settlements of accounts, debts or compromises of obligations or as
consideration for the settlement, release or surrender of a contract, tort or
other litigation claims, in each case in the ordinary course of business,
including pursuant to any plan of reorganization or similar arrangement upon the
bankruptcy or insolvency of any trade creditor or customer;

 

(i)                                     prepaid expenses and advances in the
ordinary course of business, and lease, utility, workers’ compensation,
performance and other similar deposits in the ordinary course of business;

 

(j)                                    deposits of cash with banks or other
financial institutions in the ordinary course of business so long as any such
deposits by any US Borrower and any Domestic Subsidiary are subject to perfected
Liens in favor of the US Administrative Agent;

 

(k)                                 Investments consisting of extensions of
credit in the nature of accounts receivable or notes receivable arising from the
granting of trade credit in the ordinary course of business;

 

(l)                                     Investments by any Subsidiary that is
not a Obligor in, to, or for the benefit of any Subsidiary that is not an
Obligor;

 

(m)                             Investments received as consideration from any
Disposition permitted by Section 6.04; and

 

(n)                                 other Investments not otherwise permitted by
this Section 6.05 in aggregate amounts not in excess of $1,000,000 at any time
outstanding.

 

Section 6.06                             Swap Agreements.  No Borrower will, nor
will permit any of its Subsidiaries to, enter into any Swap Agreement, except
(a) Swap Agreements entered into to hedge or mitigate raw material and supply
cost risks or other risks to which any Borrower or any of its Subsidiaries has
actual exposure; (b) Swap Agreements entered into in order to effectively cap,
collar or exchange interest rates (from fixed to floating rates, from one
floating rate to another floating rate or otherwise) with respect to any
interest-bearing liability or Investment of any Borrower or any of its
Subsidiaries; and (c) Swap Agreements to hedge foreign exchange rate risks to
which any Borrower or any of its Subsidiaries has actual or reasonably
anticipated exposure.  No Swap Agreement may be secured by a Lien except as
permitted by Section 6.02(c).

 

Section 6.07                             Restricted Payments.  No Borrower will,
nor will permit any of its Subsidiaries to, declare or make, or agree to pay or
make, any Restricted Payment, except:

 

(a)                                 Restricted Payments by any Subsidiary of the
Parent ratably with respect to the Equity Interests in such Subsidiary;

 

(b)                                 Restricted Payments to any Obligor;

 

(c)                                  Restricted Payments by the Parent pursuant
to and in accordance with any stock option plans or other benefit plans for
management (including non-employee directors) or

 

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employees of the Parent or any of its Subsidiaries in an aggregate amount during
any fiscal year not to exceed $5,000,000; and

 

(d)                                 Restricted Payments during any fiscal year
that do not exceed fifty percent (50%) of the sum of Net Income plus, to the
extent deducted in the determination of such Net Income, non-cash, non-recurring
asset impairment charges, including, without limitation, goodwill impairment
charges, writedowns associated with asset sales and unrealized tax benefits (as
determined by the Parent’s auditors) as a result of any asset impairment
charges; provided that for purposes of this clause (e) no Event of Default
exists or is created thereby.

 

Section 6.08                             Transactions with Affiliates.  No
Borrower will, and will not permit any of its Subsidiaries to, sell, lease or
otherwise transfer any property or assets to, or purchase, lease or otherwise
acquire any property or assets from, or otherwise engage in any other
transactions with any of its Affiliates, except:

 

(a)                                 at prices and on terms and conditions not
less favorable to such Borrower or such Subsidiary, as applicable, than could be
obtained on an arm’s-length basis from unrelated third parties;

 

(b)                                 any transaction between or among any of the
Obligors;

 

(c)                                  transactions between or among any
Subsidiary of the Parent that is not an Obligor and one or more other
Subsidiaries of the Parent that are not Obligors;

 

(d)                                 Indebtedness permitted by clauses (d) and
(e) of Section 6.01;

 

(e)                                  transactions permitted by Section 6.03;

 

(f)                                   any transaction permitted by clauses
(a) through (n) of Section 6.04;

 

(g)                                  Investments permitted by Section 6.05;

 

(h)                                 any Restricted Payment permitted by
Section 6.07;

 

(i)                                     the payment of reasonable fees, expenses
and compensations to officers, directors, managers, employees and consultants of
any Borrower or any of its Subsidiaries and customary indemnification and
insurance arrangements in favor of any such officer, director, manager, employee
or consultant, and any agreement related to any of the foregoing entered into in
the ordinary course of business; and

 

(j)                                    any agreements in existence on the
Effective Date, as set forth on Schedule 6.08(j), as such agreements may be
renewed, replaced or otherwise modified after the Effective Date upon terms
which taken as a whole are not less favorable to the Parent and its Subsidiaries
than the original terms of such agreements.

 

Section 6.09                             Restrictive Agreements.  No Borrower
will, and will permit any of its Subsidiaries to, directly or indirectly, enter
into, incur or permit to exist any agreement or other arrangement that
prohibits, restricts or imposes any condition upon (a) the ability of such

 

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Borrower or such Subsidiary to create, incur or permit to exist any Lien upon
any of its or their property or assets, or (b) the ability of any Obligor to pay
dividends or other distributions with respect to any shares of its capital stock
(to the extent the holder of such shares is another Obligor) or to make or repay
loans or advances to such Obligor or to guarantee Indebtedness of such Obligor;
provided that (i) the foregoing shall not apply to restrictions and conditions
imposed by Law or by any Loan Document, (ii) the foregoing shall not apply to
restrictions and conditions existing on the Effective Date identified on
Schedule 6.09 (but shall apply to any extension or renewal of, or any amendment
or modification expanding the scope of, any such restriction or condition),
(iii) the foregoing shall not apply to customary restrictions and conditions
contained in agreements relating to the sale of any Subsidiary of the Parent
pending such sale, provided such restrictions and conditions apply only to the
Subsidiary of the Parent that is to be sold and such sale is permitted
hereunder, (iv) clause (a) of the foregoing shall not apply to restrictions or
conditions imposed by any agreement relating to secured Indebtedness permitted
by this Agreement if such restrictions or conditions apply only to the property
or assets securing such Indebtedness, and (v) clause (a) of the foregoing shall
not apply to customary provisions in leases and other contracts restricting the
assignment thereof.

 

Section 6.10                             Business Acquisitions.  Except as
otherwise permitted by Section 6.05, no Borrower will, nor will permit any of
its respective Subsidiaries to, make any Business Acquisitions; provided that
each Borrower and any of its respective Subsidiaries may make Business
Acquisitions so long as (a) the sum of the aggregate cash consideration paid for
Business Acquisitions in any trailing four-quarter period (excluding any amounts
financed with new equity) shall not exceed $25,000,000 or the equivalent in such
other currency used in connection with such Business Acquisition, and the total
consideration paid for any one Business Acquisition (including any amounts
financed with new equity) shall not exceed $50,000,000 or the equivalent in such
other currency used in connection with such Business Acquisition (except as
otherwise provided in clause (d) below); (b) the Leverage Ratio calculated on a
pro forma basis for the most recently ended trailing four-quarter period for
which financial statements are required to be delivered pursuant to
Section 5.01(b) giving effect to any such Business Acquisition as if such
Business Acquisition were consummated at the commencement of such four-quarter
period shall not be greater than the maximum permitted Leverage Ratio as set
forth in Section 6.15 at such time minus 0.25; (c) the acquired business or
assets are in the same or similar line of business as any Borrower or any of its
respective Subsidiaries or any business reasonably related thereto or any
reasonable expansion or extension of any such business; (d) for any Business
Acquisition with total consideration in excess of $50,000,000 or the equivalent
in such other currency used in connection with such Business Acquisition,
Borrower shall have received the written approval of the US Administrative Agent
having received the written approval of the Required Lenders, which approval
shall not be unreasonably withheld and, in connection therewith, the Borrower
shall have given the US Administrative Agent and the Lenders at least ten
(10) Business Days prior written notice of any such proposed Business
Acquisition (each of such notices, a “Permitted Acquisition Notice”), which
notice must be timely provided and must be accompanied by all of the information
required in this Section 6.10 and shall (i) contain the estimated date such
proposed Business Acquisition is scheduled to be consummated, (ii) attach a true
and correct copy of the draft purchase agreement (if available), letter of
intent, description of material terms or similar agreements executed by the
parties thereto in connection with such proposed Business Acquisition,
(iii) contain the estimated aggregate purchase price of such proposed Business
Acquisition and the estimated amount of

 

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related costs and expenses and the intended method of financing thereof, and
(iv) contain the estimated amount of Loans required to effect such proposed
Business Acquisition; (e) no Default shall exist before or immediately after
giving effect to such Business Acquisition; (f) prior to the consummation of the
proposed Business Acquisition with a total consideration paid therefor in excess
of $10,000,000 or the equivalent in such other currency used in connection with
such Business Acquisition the Parent shall furnish the US Administrative Agent
an officer’s certificate executed by a Financial Officer, certifying as to
compliance with the requirements of the applicable preceding clauses (a) through
(c) and (e), containing the calculations required in clause (b) above; (g) the
consummation of each Business Acquisition shall be deemed to be a representation
and warranty by the Parent that all conditions thereto under this Section 6.10
have been satisfied and that same is permitted in accordance with the terms of
this Agreement, which representation and warranty shall be deemed to be a
representation and warranty for all purposes hereunder; and (h) in the case of a
Business Acquisition of the Equity Interests of a Person, such Person’s board of
directors (or similar governing body) shall have approved such Business
Acquisition.

 

Section 6.11                             Constituent Documents.  No Obligor will
amend its charter or by-laws or other constitutive documents in any manner which
could adversely and materially affect the rights of the Lenders under this
Agreement or their ability to enforce the same; provided however, any Obligor
shall be permitted after the Effective Date to amend its constitutive documents
for the purpose of changing its jurisdiction of organization so long as the US
Administrative Agent is given 30 days’ prior written notice of such change.

 

Section 6.12                             Sales and Leasebacks.  No Borrower
shall, nor shall permit any of its Subsidiaries to, directly or indirectly,
become or remain liable as lessee or as a guarantor or other surety with respect
to any lease of any property (whether real, personal or mixed), whether now
owned or hereafter acquired, that (i) any Borrower or any of its respective
Subsidiaries has sold or transferred or is to sell or transfer to any other
Person (other than any Borrower or any of its respective Subsidiaries) or
(ii) any Borrower or any of its respective Subsidiaries intends to use for
substantially the same purpose as any other property that has been or is to be
sold or transferred by such Borrower or such Subsidiary to any Person (other
than any other Borrower or any of other Subsidiaries of such Borrower) in
connection with such lease; except for any such arrangement whereby any such
sale or transfer of any assets that is made for cash consideration in an amount
not less than the cost of such asset and is consummated within 180 days after
such Borrower or such Subsidiary acquires or completes construction of such
asset.

 

Section 6.13                             Changes in Fiscal Year.  The Parent
shall not change the end of its fiscal year to a date other than December 31.

 

Section 6.14                             Fixed Charge Coverage Ratio.  The
Parent shall not permit the Fixed Charge Coverage Ratio for any trailing four
quarter period measured as of the last day of any fiscal quarter to be less than
2.0 to 1.0.

 

Section 6.15                             Leverage Ratio.  The Parent shall not
permit the Leverage Ratio for any trailing four quarter period measured as of
the last day of any fiscal quarter to exceed (i) 2.25 to 1.0 for the period from
the Effective Date through December 31, 2013 and (ii) 2.0 to 1.0 thereafter.

 

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ARTICLE VII

 

Events of Default and Remedies

 

Section 7.01                             Events of Default.  If any of the
following events (“Events of Default”) shall occur:

 

(a)                                 any Borrower shall fail to pay any principal
of any Loan or any reimbursement obligation in respect of any LC Disbursements
when and as the same shall become due and payable, whether at the due date
thereof or at a date fixed for prepayment thereof or otherwise;

 

(b)                                 any Borrower shall fail to pay any interest
on any Loan or any fee or other amount (other than an amount referred to in
clause (a) of this Section 7.01) payable under this Agreement or the other Loan
Documents in respect of any Loan when and as the same shall become due and
payable, and such failure shall continue unremedied for a period of five
(5) Business Days;

 

(c)                                  any representation or warranty made or
deemed made by or on behalf of any Borrower or any of its respective
Subsidiaries in or in connection with this Agreement or any Loan Document or any
amendment or modification hereof or waiver hereunder, or in any report,
certificate, financial statement, or other document furnished pursuant to or in
connection with this Agreement or any amendment or modification hereof or waiver
hereunder, shall prove to have been incorrect when made or deemed made;

 

(d)                                 any Borrower shall fail to observe or
perform any covenant, condition or agreement contained in Section 5.02,
Section 5.03 (with respect to the Parent’s existence) or Section 5.08 or in
ARTICLE VI;

 

(e)                                  any Borrower shall fail to observe or
perform any covenant, condition or agreement contained in this Agreement (other
than those specified in clause (a), (b) or (d) of this ARTICLE VII) or in any
other Loan Document, and such failure shall continue unremedied for a period of
30 days after notice of such failure from the US Administrative Agent to the
Parent;

 

(f)                                   any Borrower or any of their Subsidiaries
shall fail to make any payment (whether of principal or interest and regardless
of amount) in respect of any Material Indebtedness, when and as the same shall
become due and payable;

 

(g)                                  any event or condition occurs that results
in any Material Indebtedness becoming due prior to its scheduled maturity or
that enables or permits (in each case, after giving effect to any applicable
grace or notice period) the holder or holders of such Material Indebtedness or
any trustee or agent on its or their behalf to cause such Material Indebtedness
to become due, or to require the prepayment, repurchase, redemption or
defeasance thereof, prior to its scheduled maturity, provided that this clause
(g) shall not apply to secured Indebtedness that becomes due as a result of the
voluntary sale or transfer of the property or assets securing such Indebtedness;

 

(h)                                 an involuntary proceeding shall be commenced
or an involuntary petition shall be filed seeking (i) liquidation,
reorganization or other relief in respect of any Borrower or any of its

 

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Subsidiaries or its debts, or of a substantial part of its assets, under any
Federal, state or foreign bankruptcy, insolvency, receivership or similar law
now or hereafter in effect or (ii) the appointment of a receiver, trustee,
custodian, sequestrator, conservator or similar official for any Borrower or any
of its Subsidiaries or for a substantial part of its assets (individually, or in
the aggregate), and, in any such case, such proceeding or petition shall
continue undismissed for 60 days or an order or decree approving or ordering any
of the foregoing shall be entered;

 

(i)                                     any Borrower or any of its Subsidiaries,
shall (i) voluntarily commence any proceeding or file any petition seeking
liquidation, reorganization or other relief under any Federal, state or foreign
bankruptcy, insolvency, receivership or similar law now or hereafter in effect,
(ii) consent to the institution of, or fail to contest in a timely and
appropriate manner, any proceeding or petition described in clause (h) of this
Section 7.01, (iii) apply for or consent to the appointment of a receiver,
trustee, custodian, sequestrator, conservator or similar official for any
Borrower or any of its Subsidiaries or for a substantial part of their
(individually, or in the aggregate) assets, (iv) file an answer admitting the
material allegations of a petition filed against it in any such proceeding,
(v) make a general assignment for the benefit of creditors or (vi) take any
action for the purpose of effecting any of the foregoing;

 

(j)                                    any Borrower or any Subsidiary shall
become unable, admit in writing its inability, or fail generally to pay its
debts as they become due;

 

(k)                                 one or more judgments for the payment of
money that is not covered by insurance in an aggregate amount in excess of
$2,000,000 shall be rendered against any Borrower or any of its respective
Subsidiaries or any combination thereof and the same shall remain undischarged
or unstayed for a period of 60 consecutive days during which execution shall not
be effectively stayed, or any attachment or levy shall be entered upon any
assets of such Borrower or Subsidiary to enforce any such judgment;

 

(l)                                     an ERISA Event shall have occurred that,
when taken together with all other ERISA Events that have occurred, could
reasonably be expected to result in a Material Adverse Effect;

 

(m)                             a proceeding shall be commenced by any Obligor
seeking to establish the invalidity or unenforceability of any Loan Document
(exclusive of questions of interpretation thereof), or any Obligor shall
repudiate or deny that it has any liability or obligation for the payment of
principal or interest or other obligations purported to be created under any
Loan Document;

 

(n)                                 any Lien created by any of the Security
Documents shall at any time fail to constitute a valid and (to the extent
required by the Security Documents) perfected Lien on any material portion of
the Collateral purported to be subject thereto, securing the obligations
purported to be secured thereby, with the priority required by the Loan
Documents, or any Obligor shall so assert in writing, in each case (i) other
than as a result of action or inaction of the US Administrative Agent or any
Lender, including the expiration of an UCC financing statements or other
instruments necessary to perfect the US Administrative Agent’s Lien in the
Collateral or (ii) as a result of any Disposition of any Collateral permitted
under the applicable Loan Documents or as otherwise permitted thereunder; or

 

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(o)                                 a Change in Control occurs;

 

then, and in every such event (other than an event with respect to any Borrower
described in clause (h) or (i) of this Section 7.01), and at any time thereafter
during the continuance of such event, the US Administrative Agent may, and at
the request of the Required Lenders shall, by notice to the US Borrower, take
any or all of the following actions, at the same or different times: 
(i) terminate the Commitments, and thereupon the Commitments shall terminate
immediately, (ii) declare the Loans then outstanding to be due and payable in
whole (or in part, in which case any principal not so declared to be due and
payable may thereafter be declared to be due and payable), and thereupon the
principal of the Loans so declared to be due and payable, together with accrued
interest thereon and all fees and other Obligations of the Borrowers accrued
hereunder, shall become due and payable immediately, without presentment,
demand, protest or other notice of any kind, all of which are hereby waived by
each of them; and in case of any event described in clause (h) or (i) of this
Section 7.01, the Commitments shall automatically terminate and the principal of
the Loans then outstanding, together with accrued interest thereon and all fees
and other Obligations of the Borrowers accrued hereunder, shall automatically
become due and payable, without presentment, demand, protest notice of
acceleration or the intent to accelerate or any other notice of any kind, all of
which are hereby waived by each of them, and (iii) exercise any or all of the
remedies available to it under any of the Loan Documents, at Law or in equity
(including, without limitation, conducting a foreclosure sale of any of the
Collateral).

 

Section 7.02                             Cash Collateral.  In addition to the
remedies contained in Section 7.01, upon the occurrence and continuance of any
Event of Default, the Agents shall have the remedies available to them under
Section 2.05(j).

 

ARTICLE VIII

 

The Agents

 

Each Lender and each Issuing Lender hereby irrevocably appoints the US
Administrative Agent, the Euro Administrative Agent and the Canadian
Administrative Agent as its agents and authorizes each Agent to take such
actions on its behalf and to exercise such powers as are delegated to the Agents
by the terms hereof, together with such actions and powers as are reasonably
incidental thereto.

 

Each Lender serving as an Agent hereunder shall have the same rights and powers
in its capacity as a Lender as any other Lender and may exercise the same as
though it were not an Agent, and such bank and its Affiliates may accept
deposits from, lend money to and generally engage in any kind of business with
any Borrower or any Affiliate thereof as if it were not an Agent hereunder.

 

The Agents shall not have any duties or obligations except those expressly set
forth herein and in the other Loan Documents.  Without limiting the generality
of the foregoing, (a) the Agents shall not be subject to any fiduciary or other
implied duties, regardless of whether a Default or an Event of Default has
occurred and is continuing, (b) the Agents shall not have any duty to take any
discretionary action or exercise any discretionary powers, except

 

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discretionary rights and powers expressly contemplated hereby that the Agents
required to exercise in writing as directed by the Required Lenders (or such
other number or percentage of the Lenders as shall be necessary under the
circumstances as provided in Section 10.02), and (c) except as expressly set
forth herein, the Agents shall not have any duty to disclose, and shall not be
liable for the failure to disclose, any information relating to the Borrowers or
any of their Subsidiaries that is communicated to or obtained by the Agents or
any of their Affiliates in any capacity.  The Agents shall not be liable for any
action taken or not taken by them with the consent or at the request of the
Required Lenders (or such other number or percentage of the Lenders as shall be
necessary under the circumstances as provided in Section 10.02) or in the
absence of its own gross negligence or willful misconduct.  The Agents shall be
deemed not to have knowledge of any Default or Event of Default unless and until
written notice thereof is given to the Agents by a Borrower or a Lender, and the
Agents shall not be responsible for or have any duty to ascertain or inquire
into (i) any statement, warranty or representation made in or in connection with
this Agreement, (ii) the contents of any certificate, report or other document
delivered hereunder or in connection herewith, (iii) the performance or
observance of any of the covenants, agreements or other terms or conditions set
forth herein, (iv) the validity, enforceability, effectiveness or genuineness of
this Agreement or any other agreement, instrument or document, or (v) the
satisfaction of any condition set forth in ARTICLE IV or elsewhere herein, other
than to confirm receipt of items expressly required to be delivered to the
Agents.

 

The Agents shall be entitled to rely upon, and shall not incur any liability for
relying upon, any notice, request, certificate, consent, statement, instrument,
document or other writing believed by it to be genuine and to have been signed
or sent by the proper Person.  The Agents also may rely upon any statement made
to them orally or by telephone and believed by it to be made by the proper
Person, and shall not incur any liability for relying thereon.  The Agents may
consult with legal counsel (who may be counsel for the Borrowers), independent
accountants and other experts selected by it, and shall not be liable for any
action taken or not taken by it in accordance with the advice of any such
counsel, accountants or experts.

 

The Agents may perform any and all their duties and exercise its rights and
powers by or through any one or more sub-agents appointed by the Agents.  The
Agents and any such sub-agent may perform any and all its duties and exercise
its rights and powers through their respective Related Parties.  The exculpatory
provisions of the preceding paragraphs shall apply to any such sub-agent and to
the Related Parties of the Agents and any such sub-agent, and shall apply to
their respective activities in connection with the syndication of the credit
facilities provided for herein as well as activities as the Agents.

 

In addition, each Lender and each Issuing Lender hereby indemnifies the Agents
(to the extent not reimbursed by the Borrowers), ratably according to its
respective pro rata share of the total of the Commitments, or if no Commitments
are outstanding, the respective pro rata share of the total of the Commitments
immediately prior to the time Commitments ceased to be outstanding held by each
of them, from and against any and all liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses or disbursements of any
kind or nature whatsoever which may be imposed on, incurred by, or asserted
against the Agents (or any of them) in any way relating to or arising out of
this Agreement or any action taken or omitted by the Agents under this Agreement
or the other Loan Documents (including any action taken or

 

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omitted under ARTICLE II of this Agreement); provided that such indemnity shall
not, as to any Agent, be available to the extent that such liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements resulted from the gross negligence or willful
misconduct of such Agent.  Without limitation of the foregoing, each Lender and
each Issuing Lender agrees to reimburse each of the Agents promptly upon demand
for its respective pro rata share of the total of the Commitments of any
out-of-pocket expenses (including reasonable counsel fees) incurred by the
Agents (or any of them) in connection with the preparation, execution,
administration or enforcement of, or legal advice in respect of rights or
responsibilities under, this Agreement or the other Loan Documents to the extent
that such Agent is not reimbursed for such expenses by the Borrowers.  The
provisions of this section shall survive the termination of this Agreement and
the payment of the Obligations.

 

Subject to the appointment and acceptance of a successor Agent as provided in
this paragraph, any Agent may resign at any time by notifying the Lenders, the
Issuing Lenders and the Parent.  Upon any such resignation, the Required Lenders
shall have the right, with the approval of the Parent, which shall not be
unreasonably withheld, conditioned or delayed, and shall not be required during
the existence of an Event of Default, to appoint a successor.  If no successor
shall have been so appointed by the Required Lenders and shall have accepted
such appointment within 30 days after the retiring Agent gives notice of its
resignation, then the retiring Agent may, on behalf of the Lenders and the
Issuing Lenders, appoint a successor Agent which shall be a bank with an office
in (a) New York, New York, if such successor bank is the US Administrative
Agent, (b) London, England, if such successor bank is the Euro Administrative
Agent or (c) Toronto, Canada, if such successor bank is the Canadian
Administrative Agent, or, in each case, an Affiliate of any such bank.  Upon the
acceptance of its appointment as Agent hereunder by a successor, such successor
shall succeed to and become vested with all the rights, powers, privileges and
duties of the retiring Agent, and the retiring Agent shall be discharged from
its duties and obligations hereunder.  The fees payable by the Borrowers to a
successor Agent shall be the same as those payable to its predecessor unless
otherwise agreed between the Borrowers and such successor.  After an Agent’s
resignation hereunder, the provisions of this ARTICLE III and Section 10.03
shall continue in effect for the benefit of such retiring Agent, its sub-agents
and their respective Related Parties in respect of any actions taken or omitted
to be taken by any of them while it was acting as Agent.

 

Each Lender acknowledges that it has, independently and without reliance upon
the Agents or any other Lender and based on such documents and information as it
has deemed appropriate, made its own credit analysis and decision to enter into
this Agreement.  Each Lender also acknowledges that it will, independently and
without reliance upon the Agents or any other Lender and based on such documents
and information as it shall from time to time deem appropriate, continue to make
its own decisions in taking or not taking action under or based upon this
Agreement, any related agreement or any document furnished hereunder or
thereunder.

 

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ARTICLE IX

Guarantees

 

Section 9.01                             The Guarantees.  (a)(i)  Each US
Guarantor the assets of which are all or substantially all comprised of stock or
securities in one or more Foreign Subsidiaries hereby jointly, severally,
unconditionally and irrevocably with every other such US Guarantor guarantees
the full and punctual payment (whether at stated maturity, upon acceleration or
otherwise) of the principal of and interest on the Euro Loans and the Canadian
Loans, and the full and punctual payment of all other Obligations payable by the
Euro Borrowers, the Canadian Borrowers and the Foreign Guarantors under the Loan
Documents.  Upon failure by any Euro Borrower, any Canadian Borrower or any
Foreign Guarantor to pay punctually any such amount, each such US Guarantor
shall forthwith on demand pay the amount not so paid at the place and in the
manner specified in this Agreement or the other Loan Documents.

 

(ii)                                  Each US Guarantor the assets of which are
not all or substantially all comprised of stock or securities in one or more
Foreign Subsidiaries hereby jointly, severally, unconditionally and irrevocably
with every other such US Guarantor guarantees the full and punctual payment
(whether at stated maturity, upon acceleration or otherwise) of the principal of
and interest on the US Loans, the Euro Loans and the Canadian Loans, and the
full and punctual payment of all other Obligations payable by the US Borrowers,
the Euro Borrowers, the Canadian Borrowers, the Foreign Guarantors or any other
US Guarantor under the Loan Documents.  Upon failure by any US Borrower, any
Euro Borrower, any Canadian Borrower, any Foreign Guarantor or any other US
Guarantor to pay punctually any such amount, each such US Guarantor shall
forthwith on demand pay the amount not so paid at the place and in the manner
specified in this Agreement or the other Loan Documents.

 

(iii)                               The Guarantee contained in clauses (i) and
(ii) of this paragraph is a guaranty of payment and not of collection.  The
Lenders shall not be required to exhaust any right or remedy or take any action
against any Borrower, any Guarantor or any other Person or any Collateral.  Each
US Guarantor agrees that, as between such US Guarantor and the Lenders, the
Obligations of the US Borrowers, the Euro Borrowers, the Canadian Borrowers, the
Foreign Guarantors and the other US Guarantors may be declared to be due and
payable for the purposes of this Guarantee notwithstanding any stay, injunction
or other prohibition which may prevent, delay or vitiate any declaration as
regards the US Borrowers, the Euro Borrowers or the Canadian Borrowers and that
in the event of a declaration or attempted declaration, the Obligations of the
US Borrowers, the Euro Borrowers, the Canadian Borrowers, the Foreign Guarantors
and the other US Guarantors shall immediately become due and payable by each US
Guarantor for the purposes of this Guarantee.

 

(b)                                 Each Foreign Guarantor hereby jointly,
severally, unconditionally and irrevocably guarantees the full and punctual
payment (whether at stated maturity, upon acceleration or otherwise) of the
principal of and interest on the Euro Loans and the Canadian Loans, and the full
and punctual payment of all other Obligations payable by the Euro Borrowers, the
Canadian Borrowers or any other Foreign Guarantor under the Loan Documents. 
Upon failure by any Euro Borrower, any Canadian Borrower or any other Foreign
Guarantor to pay punctually any

 

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such amount, each Foreign Guarantor shall forthwith on demand pay the amount not
so paid at the place and in the manner specified in this Agreement or the other
Loan Documents.  This Guarantee is a guaranty of payment and not of collection. 
The Lenders shall not be required to exhaust any right or remedy or take any
action against the Borrowers, the Guarantors, or any other Person or any
Collateral.  The Foreign Guarantors agree that, as between the Foreign
Guarantors and the Lenders, the Obligations of the Euro Borrowers, the Canadian
Borrowers and the other Foreign Guarantors may be declared to be due and payable
for the purposes of this Guarantee notwithstanding any stay, injunction or other
prohibition which may prevent, delay or vitiate any declaration as regards the
Euro Borrowers or the Canadian Borrowers and that in the event of a declaration
or attempted declaration, the Obligations of the Euro Borrowers and the Canadian
Borrowers and the other Foreign Guarantors shall immediately become due and
payable by each Foreign Guarantor for the purposes of this Guarantee.

 

Section 9.02                             Guarantee Unconditional.  The
obligations of each of the Guarantors under this ARTICLE IX shall be
unconditional and absolute and, without limiting the generality of the
foregoing, shall not be released, discharged or otherwise affected by:

 

(a)                                 any extension, renewal, settlement,
compromise, waiver or release in respect of any Obligation of any of the
Borrowers or any other Guarantor under the Loan Documents, by operation of law
or otherwise;

 

(b)                                 any modification, amendment or waiver of or
supplement to the Loan Documents;

 

(c)                                  any release, impairment, non-perfection or
invalidity of any direct or indirect security for any obligation of any
Borrowers or any other Guarantor under the Loan Documents;

 

(d)                                 any change in the corporate existence,
structure or ownership of any of the Borrowers or any other Guarantor, or any
insolvency, bankruptcy, reorganization or other similar proceeding affecting any
of the Borrowers, any other Guarantor or their respective assets or any
resulting release or discharge of any obligation of any of the Borrowers or any
other Guarantor contained in the Loan Documents;

 

(e)                                  the existence of any claim, set-off or
other rights which the Guarantor may have at any time against any of the
Borrowers, any other Guarantor, any of the Agents, any Lender or any other
Person, whether in connection herewith or any unrelated transactions, provided
that nothing herein shall prevent the assertion of any such claim by separate
suit or compulsory counterclaim;

 

(f)                                   any invalidity or unenforceability
relating to or against any of the Borrowers or any other Guarantor for any
reason of the Loan Documents, or any provision of applicable law or regulation
purporting to prohibit the payment by any of the Borrowers or any other
Guarantor of the principal of or interest on any Loan or any other amount
payable by any of the Borrowers or any other Guarantor under the Loan Documents;
or

 

(g)                                  any other act or omission or delay of any
kind by any of the Borrowers, any other Guarantor, the Agents, any Lender or any
other Person or any other circumstance whatsoever that might, but for the
provisions of this paragraph, constitute a legal or equitable discharge of the
Guarantor’s obligations hereunder.

 

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Furthermore, notwithstanding that the Borrowers may not be obligated to the
Agents and/or the Lenders for interest and/or attorneys’ fees and expenses on,
or in connection with, any Obligations from and after the Petition Date (as
hereinafter defined) as a result of the provisions of the federal bankruptcy law
or otherwise, Obligations for which the Guarantors shall be obligated shall
include interest accruing on the Obligations at the Default Rate from and after
the date on which such Borrower files for protection under the federal
bankruptcy laws or from and after the date on which an involuntary proceeding is
filed against such Borrower under the federal bankruptcy laws (herein
collectively referred to as the “Petition Date”) and all reasonable attorneys’
fees and expenses incurred by the Agents and the Lenders from and after the
Petition Date in connection with the Obligations.

 

Section 9.03                             Discharge Only Upon Payment in Full;
Reinstatement In Certain Circumstances.  The obligations of each of the
Guarantors under this Article IX shall remain in full force and effect until the
Commitments shall have terminated and the principal of and interest on the Loans
and all other amounts payable by the Obligors under the Loan Documents shall
have been paid in full.  If at any time any payment of the principal of or
interest on any Loan or any other amount payable by the Obligors under the Loan
Documents is rescinded or must be otherwise restored or returned upon the
insolvency, bankruptcy or reorganization of any Obligor or otherwise, the
obligations of each of the Guarantors under this ARTICLE IX with respect to such
payment shall be reinstated at such time as though such payment had been due but
not made at such time.  The US Guarantors under Section 9.01(a)(i) jointly and
severally agree to indemnify each Euro Lender and each Canadian Lender, the US
Guarantors under Section 9.01(a)(ii) jointly and severally agree to indemnify
each US Lender, each Euro Lender and each Canadian Lender and the Foreign
Guarantors jointly and severally agree to indemnify each Euro Lender and each
Canadian Lender on demand for all reasonable costs and expenses (including
reasonable fees of counsel) incurred by such Lender 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 bankruptcy, insolvency or
similar law, other than any costs or expenses resulting from the bad faith or
willful misconduct of such Lender.

 

Section 9.04                             Waiver by Each Guarantor.  Each
Guarantor irrevocably waives acceptance hereof, diligence, presentment, demand,
protest notice of acceleration or the intent to accelerate and any other notice
not provided for in this ARTICLE IX, as well as any requirement that at any time
any action be taken by any Person against the Borrowers or any other Guarantor
or any other Person.

 

Section 9.05                             Subrogation.  Each US Guarantor under
Section 9.01(a)(ii) shall be subrogated to all rights of the US Lenders, the US
Administrative Agent and the holders of the US Loans against the US Borrowers;
provided that such Guarantor shall not be entitled to enforce or to receive any
payments arising out of or based upon such right of subrogation until the
principal of and interest on the Loans and all other sums at any time payable by
the Borrowers under the Loan Documents shall have been paid in full.  Each US
Guarantor under Section 9.01(a)(i) and each Foreign Guarantor shall be
subrogated to all rights of the Euro Lenders, the Canadian Lenders, the Euro
Administrative Agent, the Canadian Administrative Agent and the holders of the
Euro Loans and the Canadian Loans against the Euro Borrowers and the Canadian
Borrowers; provided that such Guarantor shall not be entitled to enforce or to

 

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receive any payments arising out of or based upon such right of subrogation
until the principal of and interest on the Loans and all other sums at any time
payable by the Borrowers under the Loan Documents shall have been paid in full. 
If any amount is paid to any Guarantor on account of subrogation rights under
these Guarantees at any time when all the Obligations have not been indefeasibly
paid in full, the amount shall be held in trust for the benefit of the US
Lenders, the Euro Lenders or the Canadian Lenders, as applicable, and shall be
promptly paid to the Agents to be credited and applied to the Obligations,
whether matured or unmatured or absolute or contingent, in accordance with the
terms of this Agreement.

 

Section 9.06                             Stay of Acceleration.

 

(a)                                 If acceleration of the time for payment of
any amount payable by any Obligor under the Loan Documents is stayed upon
insolvency, bankruptcy or reorganization of any US Borrower, all such amounts
otherwise subject to acceleration under the terms of this Agreement shall
nonetheless be payable by each US Guarantor under Section 9.01(a)(ii) for its
respective Obligations as described in this ARTICLE IX promptly following demand
by the US Administrative Agent made at the request of the requisite proportion
of the Lenders specified in ARTICLE X of this Agreement.

 

(b)                                 If acceleration of the time for payment of
any amount payable by any Obligor under the Loan Documents is stayed upon
insolvency, bankruptcy or reorganization of any Euro Borrower or any Canadian
Borrower, all such amounts otherwise subject to acceleration under the terms of
this Agreement shall nonetheless be payable by each US Guarantor under
Section 9.01(a)(i) and each Foreign Guarantor hereunder for its respective
Obligations as described in this ARTICLE IX promptly following demand by the
Euro Administrative Agent made at the request of the requisite proportion of the
Lenders specified in ARTICLE X of this Agreement.

 

Section 9.07                             Limit of Liability.  Notwithstanding
any other provision of this ARTICLE IX, the obligations of each of the
Guarantors under this ARTICLE IX shall be limited to an aggregate amount equal
to the largest amount that would not render its obligations hereunder subject to
avoidance under Section 548 of the United States Bankruptcy Code or any
comparable provisions of any applicable state law.

 

Section 9.08                             Release upon Sale.  Upon any sale of
any Guarantor permitted by this Agreement, and, if required hereunder, payment
to the Agents, as applicable, for the pro rata benefit of the applicable
Lenders, of the proceeds of such sale, such Guarantor shall (a) be released from
its obligations as a Guarantor hereunder, (b) all Liens, if any, securing such
Guarantee shall automatically be terminated and released and (c) the US
Administrative Agent will, at the expense of said Guarantor, execute and deliver
such documents as are reasonably necessary to evidence said releases and
terminations, following written request from the applicable Borrower and receipt
by the US Administrative Agent of a certificate from the applicable Borrower
certifying no Default or Event of Default exists.

 

Section 9.09                             Benefit to Guarantor.  Each Guarantor
acknowledges that the Loans made to the Borrowers may be, in part, re-loaned to,
or used for the benefit of, such Guarantor and its Affiliates, that each
Guarantor, because of the utilization of the proceeds of the Loans, will

 

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receive a direct benefit from the Loans and that, without the Loans, such
Guarantor would not be able to continue its operations and carry on its business
as presently conducted.

 

Section 9.10                             Jurisdiction Specific Provisions.  The
provisions of this ARTICLE IX are subject to the limitations contained in the
jurisdiction specific provisions contained in Schedule 9.10 attached hereto.

 

ARTICLE X

Miscellaneous

 

Section 10.01                      Notices.

 

(a)                                 Except in the case of notices and other
communications expressly permitted to be given by telephone (and subject to
paragraph (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 facsimile, as follows:

 

(i)                                     if to the Parent or any other Borrower,
to

 

Dynamic Materials Corporation

5405 Spine Road

Boulder, Colorado  80301

Attention:  Chief Financial Officer

Facsimile No.:  (303) 604-1897

Telephone No.:  (303) 655-5700

 

with a copy to

 

Holme Roberts & Owen LLP

1700 Lincoln Street, Suite 4100

Denver, Colorado  80203

Attention:  Garth Jensen

Facsimile No.:  (303) 866-0200

Telephone No.:  (303) 866-0365

 

(ii)                                  if to a Guarantor, to it in care of the
Parent;

 

(iii)                               if to the US Administrative Agent, to

 

JP Morgan Loan Services

JPMorgan Chase Bank, N.A.

Loan and Agency Service Group

10 South Dearborn, 7th Floor

Chicago, Illinois 60603

Facsimile No.:  (312) 385-7102

Telephone No.:  (312) 732-2009

 

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with copies to

 

JPMorgan Chase Bank, N.A.

1125 17th Street, Suite 300

Denver, Colorado  80202

Attention:  Brennon Crist

Facsimile No.:  (303) 244-3351

Telephone No.:  (303) 244-3220

 

Andrews Kurth LLP

600 Travis, Suite 4200

Houston, Texas  77002

Attention:  Marty DeBusk

Facsimile No.:  (713) 238-7202

Telephone No.:  (713) 220-4372

 

(iv)                              If to the Euro Administrative Agent, to

 

J.P. Morgan Europe Limited

125 London Wall

London

England

EC2Y 5AJ

Attention:  Agency Department

Facsimile No.:  (44) 207 777 2360

Telephone No.:  (44) 207 777 2352/2355

 

(v)                                 if to the Canadian Administrative Agent, to

 

JP Morgan Loan Services

JPMorgan Chase Bank, N.A.

Loan and Agency Service Group

10 South Dearborn, 7th Floor

Chicago, Illinois 60603

Facsimile No.:  (312) 385-7102

Telephone No.:  (312) 732-2009

 

(vi)                              if to the US Issuing Lender, to

 

JP Morgan Loan Services

JPMorgan Chase Bank, N.A.

Loan and Agency Service Group

10 South Dearborn, 7th Floor

Chicago, Illinois 60603

Facsimile No.:  (312) 385-7102

Telephone No.:  (312) 732-2009

 

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with a copy to

 

JPMorgan Chase Bank, N.A.

1125 17th Street, Suite 300

Denver, Colorado  80202

Attention:  Brennon Crist

Facsimile No.:  (303) 244-3351

Telephone No.:  (303) 244-3220

 

(vii)                           if to the Euro Issuing Lender, to

 

J. P. Morgan Europe Limited
125 London Wall
London
England
EC2Y 5AJ
Attention:  Agency Department
Facsimile No.:  (44) 207 777 2360
Telephone No.: (44) 207 777 2352/2355

 

with a copy to

 

Global Trade Solutions
1 Chaseside (DB01-0365)
Bournemouth
England
BH 7 7DA
Attention:  Fiona Hallam
Facsimile No.:  (44) 1202 343730
Telephone No.: (44) 1202 347744

 

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(viii)                        if to the Canadian Issuing Lender, to

 

JP Morgan Loan Services

JPMorgan Chase Bank, N.A.

Loan and Agency Service Group

10 South Dearborn, 7th Floor

Chicago, Illinois 60603

Facsimile No.:  (312) 385-7102

Telephone No.:  (312) 732-2009

 

(ix)                              if to the US Swingline Lender, to

 

JP Morgan Loan Services

JPMorgan Chase Bank, N.A.

Loan and Agency Service Group

10 South Dearborn, 7th Floor

Chicago, Illinois 60603

Facsimile No.:  (312) 385-7102

Telephone No.:  (312) 732-2009

 

with a copy to

 

JPMorgan Chase Bank, N.A.

1125 17th Street, Suite 300

Denver, Colorado  80202

Attention:  Brennon Crist

Facsimile No.:  (303) 244-3351

Telephone No.:  (303) 244-3220

 

(x)                                 if to the Euro Swingline Lender to

 

J. P. Morgan Europe Limited
125 London Wall
London
England
EC2Y 5AJ
Attention:  Agency Department
Facsimile No.:  (44) 207 777 2360
Telephone No.: (44) 207 777 2352/2355

 

(xi)                              if to any other Lender, to it at its address
(or facsimile number) set forth in its Administrative Questionnaire.

 

(b)                                 Notices and other communications to the
Lenders hereunder may be delivered or furnished by electronic communications
pursuant to procedures approved by the US Administrative Agent.  Each of the
Agents or the Borrowers may, in its discretion, agree to accept notices and
other communications to it hereunder by electronic communications pursuant

 

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to procedures approved by it; provided that approval of such procedures may be
limited to particular notices or communications.

 

(c)                                  Any party hereto may change its address or
facsimile number for notices and other communications hereunder by notice to the
other parties hereto.  All notices and other communications given to any party
hereto in accordance with the provisions of this Agreement shall be deemed to
have been given on the date of receipt.

 

Section 10.02                      Waivers; Amendments.

 

(a)                                 No failure or delay by any Agent, Issuing
Lender or Lender in exercising any right or power hereunder shall operate as a
waiver thereof, nor shall any single or partial exercise of any such right or
power, or any abandonment or discontinuance of steps to enforce such a right or
power, preclude any other or further exercise thereof or the exercise of any
other right or power.  The rights and remedies of the Agents, the Issuing
Lenders and the Lenders hereunder are cumulative and are not exclusive of any
rights or remedies that they would otherwise have.  No waiver of any provision
of this Agreement or consent to any departure by any Obligor therefrom shall in
any event be effective unless the same shall be permitted by paragraph (b) of
this Section, and then such waiver or consent shall be effective only in the
specific instance and for the purpose for which given.  Without limiting the
generality of the foregoing, the making of a Loan or issuance of a Letter of
Credit shall not be construed as a waiver of any Default, regardless of whether
any Agent, Lender or Issuing Lender may have had notice or knowledge of such
Default at the time.

 

(b)                                 Neither this Agreement nor any provision
hereof may be waived, amended or modified except pursuant to an agreement or
agreements in writing entered into by the Borrowers and the Required Lenders or
by the Borrowers and the US Administrative Agent with the consent of the
Required Lenders; provided that no such agreement shall (i) increase the
Commitment of any Lender without the written consent of such Lender, (ii) reduce
the principal amount of any Loan or LC Disbursement or reduce the rate of
interest thereon (including any agreement to amend or modify the definition of
Leverage Ratio that would have the effect of reducing such rate of interest), or
reduce any fees payable hereunder, without the written consent of each Lender
directly affected thereby, (iii) postpone the scheduled date of payment of the
principal amount of any Loan or LC Disbursement, or any interest thereon, or any
fees payable hereunder, or reduce the amount of, waive or excuse any such
payment, or postpone the scheduled date of expiration of any Commitment, without
the written consent of each Lender directly affected thereby, (iv) change
Section 2.17(b) or Section 2.17(c) in a manner that would alter the pro rata
sharing of payments required thereby, without the written consent of each
Lender, (v) change any of the provisions of this Section 10.02(b) or the
definition of “Required Lenders” or any other provision hereof specifying the
number or percentage of Lenders required to waive, amend or modify any rights
hereunder or make any determination or grant any consent hereunder, without the
written consent of each Lender, (vi) release all or substantially all of the
Collateral from the Liens of the Security Documents, without the written consent
of each Lender, provided, that nothing herein shall prohibit the US
Administrative Agent from releasing any Collateral, or require the consent of
the other Lenders for such release, in respect of items sold, leased, conveyed
or otherwise disposed to the extent such sale, lease, conveyance or other
disposition is permitted hereunder, (vii) release all or substantially all of
the Guarantees (other

 

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than in connection with any transaction permitted hereunder), without the
written consent of each Lender or (viii) change any of the provisions of
Section 2.20 or the definition of “Defaulting Lender” without the consent of the
Required Lenders, each Agent, each Swingline Lender and each Issuing Lender;
provided, further, that no such agreement shall amend, modify or otherwise
affect the rights or duties of any Agent, Issuing Lender or Swingline Lender
hereunder without the prior written consent of such Agent, Issuing Lender or
Swingline Lender, as applicable.  Notwithstanding anything to the contrary
herein, no Defaulting Lender shall have any right to approve or disapprove any
amendment, waiver or consent hereunder (and any amendment, waiver or consent
which by its terms requires the consent of all Lenders or each affected Lender
may be effected with the consent of the applicable Lenders other than Defaulting
Lenders), except that (x) the Commitment of any Defaulting Lender may not be
increased or extended without the consent of such Lender and (y) any waiver,
amendment or modification requiring the consent (1) of all Lenders or (2) of
each affected Lender that by its terms affects any Defaulting Lender more
adversely than other affected Lenders shall require the consent of such
Defaulting Lender.

 

Section 10.03                      Expenses; Indemnity; Damage Waiver.

 

(a)                                 The Parent shall pay (i) all reasonable
out-of-pocket expenses incurred by the Agents and their Affiliates, including
the reasonable fees, charges and disbursements of counsel and consultants for
the Agents, in connection with the syndication of the credit facilities provided
for herein, due diligence undertaken by the Agents with respect to the financing
contemplated by this Agreement, the preparation and administration of this
Agreement or any amendments, modifications or waivers of the provisions hereof
(whether or not the transactions contemplated hereby or thereby shall be
consummated), (ii) all reasonable out-of-pocket expenses incurred by the Issuing
Lenders in connection with the issuance, amendment, renewal or extension of any
Letter of Credit or any demand for payment thereunder and (iii) all reasonable
out-of-pocket expenses incurred by any Agent, Issuing Lender or Lender,
including the fees, charges and disbursements of one primary law firm as
counsel, local counsel as needed and consultants for any Agent, Issuing Lender
or Lender, in connection with the enforcement or protection of its rights in
connection with this Agreement, including its rights under this Section, or 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)                                 The Parent shall indemnify each
Agent, Issuing Lender and Lender, and each Related Party of any of the foregoing
Persons (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 reasonable fees, charges and disbursements of
any counsel for any Indemnitee, incurred by or asserted against any Indemnitee
arising out of, in connection with, or as a result of (i) the execution or
delivery of this Agreement, any agreement or instrument contemplated hereby, the
performance by the parties hereto of their respective obligations hereunder or
the consummation of the Transactions or any other transactions contemplated
hereby, (ii) any Loan made or Letter of Credit issued by any Lender or Issuing
Lender, as applicable, or the use of the proceeds therefrom (including any
refusal by any Issuing 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),

 

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(iii) any actual or alleged presence or release of Hazardous Materials on or
from any property owned or operated by the Parent or any of its Subsidiaries, or
any Environmental Liability related in any way to the Parent or any of its
Subsidiaries, or (iv) any actual claim, litigation, investigation or proceeding
relating to any of the foregoing, whether based on contract, tort or any other
theory and regardless of whether any Indemnitee is a party thereto; and whether
or not caused by the ordinary, sole or contributory negligence of any
Indemnitee, provided further that such indemnity shall not, as to any
Indemnitee, be available to the extent that such losses, claims, damages,
liabilities or related expenses resulted from the gross negligence or willful
misconduct of such Indemnitee.  It is agreed by the parties hereto that the
indemnity obligations of the Parent under the Commitment Letter are superseded
to the extent described in this Agreement.

 

(c)           To the extent that the Parent fails to pay any amount required to
be paid by it under paragraph (a) or (b) of this Section, (i) in the case of
amounts owed to the US Administrative Agent, the US Issuing Lender or the US
Swingline Lender, each US Lender severally agrees to pay to the US
Administrative Agent, the US Issuing Lender or the US Swingline Lender, as the
case may be, such Lender’s Applicable Percentage of such unpaid amount, (ii) in
the case of the case of amounts owed to the Euro Administrative Agent, the Euro
Issuing Lender or the Euro Swingline Lender, each Euro Lender severally agrees
to pay to the Euro Administrative Agent, the Euro Issuing Lender or the Euro
Swingline Lender, as the case may be, such Lender’s Applicable Percentage of
such unpaid amount, and (iii) in the case of amounts owed to the Canadian
Administrative Agent or the Canadian Issuing Lender, each Canadian Lender
severally agrees to pay to the Canadian Administrative Agent or the Canadian
Issuing Lender, as the case may be, such Lender’s Applicable Percentage of such
unpaid amount, in each case, as such unpaid amount is determined as of the time
that the applicable unreimbursed expense or indemnity payment is sought;
provided that the unreimbursed expense or indemnified loss, claim, damage,
liability or related expense, as applicable, was incurred by or asserted against
such Agent, Issuing Lender or Swingline Lender in its capacity as such.

 

(d)           To the extent permitted by applicable Law, each Obligor shall not
assert, and 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 or any agreement or instrument contemplated hereby, the
Transactions, any Loan or Letter of Credit or the use of the proceeds thereof.

 

(e)           All amounts due under this Section shall be payable no later than
ten (10) Business Days from demand therefor.

 

Section 10.04         Successors and Assigns.

 

(a)           The provisions of this Agreement shall be binding upon and inure
to the benefit of the parties hereto and their respective successors and assigns
permitted hereby (including any Affiliate of any Issuing Lender that issues any
Letter of Credit), except that (i) no Borrower may assign or otherwise transfer
any of its rights or obligations hereunder without the prior written consent of
each Lender (and any attempted assignment or transfer by such Borrower without
such consent shall be null and void), except pursuant to a merger in accordance
with Section 6.03; and (ii) no Lender may assign or otherwise transfer its
rights or obligations

 

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hereunder except in accordance with this Section.  Nothing in this Agreement,
expressed or implied, shall be construed to confer upon any Person (other than
the parties hereto, their respective successors and assigns permitted hereby
(including any Affiliate of any Issuing Lender that issues any Letter of
Credit), Indemnitees, Participants (to the extent provided in paragraph (c) of
this Section) and, to the extent expressly contemplated hereby, the Related
Parties of each of the Agents, the Issuing Lenders and the Lenders) any legal or
equitable right, remedy or claim under or by reason of this Agreement.

 

(b)           (i) Subject to the conditions set forth in paragraph (b)(ii) of
this Section, any Lender may assign to one or more assignees all or a portion of
its rights and obligations under this Agreement (including all or a portion of
its Commitment and the Loans at the time owing to it) with the prior written
consent (such consent not to be unreasonably withheld or delayed) of:

 

(A)          the Parent, provided that no such consent shall be required for an
assignment to a Lender or an Affiliate of a Lender or if any Event of Default
has occurred and is continuing; provided further that the Parent shall be deemed
to have consented to any such assignment unless it shall object thereto by
written notice to the US Administrative Agent within seven Business Days after
having received written notice thereof;

 

(B)           the US Administrative Agent, provided that no such consent shall
be required for an assignment of any Commitment to an assignee that is a Lender
with a Commitment of the same Class immediately prior to giving effect to such
assignment; and

 

(C)           each Issuing Lender and Swingline Lender.

 

(ii)           Assignments shall be subject to the following additional
conditions:

 

(A)          except in the case of an assignment to a Lender or an Affiliate of
a Lender or an assignment of the entire remaining amount of the assigning
Lender’s Commitment or Loans of any Class, the aggregate amount of the
Commitment or Loans of the assigning Lender subject to each such assignment
(determined as of the date the Assignment and Assumption with respect to such
assignment is delivered to the US Administrative Agent) shall not be less than
$5,000,000 or the equivalent amount as determined by the US Administrative Agent
and after giving affect to such assignment, the assigning Lender’s Commitment or
Loans shall not be less than $5,000,000 or the equivalent amount as determined
by the US Administrative Agent unless each of the Parent and the US
Administrative Agent otherwise consent, provided that no such consent of the
Parent shall be required if an Event of Default under clause (a), (b), (h) or
(i) of Section 7.01 has occurred and is continuing; provided further that the
Parent shall be deemed to have consented to any such assignment unless it shall
object thereto by written notice to the US Administrative Agent within seven
Business Days after having received written notice thereof;

 

(B)           each assignment shall be of a constant, and not a varying,
percentage of all of the assigning Lender’s rights and obligations under this
Agreement and be pro rata among the Classes of Commitments of each Lender;

 

(C)           the parties to each assignment shall execute and deliver to the US
Administrative Agent an Assignment and Assumption, together with a processing
and recordation fee of $3,500 (which fee shall not be payable by or due or owing
from any Obligor);

 

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(D)          the assignee, if it shall not be a Lender, shall deliver to the US
Administrative Agent an Administrative Questionnaire in which the assignee
designates one or more credit contacts to whom all syndicate-level information
(which may contain material non-public information about the Borrowers, the
Guarantors and their Related Parties or their respective securities) will be
made available and who may receive such information in accordance with the
assignee’s compliance procedures and applicable laws, including Federal and
state securities laws;

 

(E)           no assignment shall be made that results in an increase to the
Mandatory Cost or increased liability of any Obligor under Section 2.14 or
Section 2.16; and

 

(F)           no assignment shall be made to (1) any Borrower or any Affiliate
thereof, (2) any Defaulting Lender or any of its Affiliates, or any Person who,
upon becoming a Lender hereunder, would constitute any of the foregoing Persons
described in this clause (2), or (3) to a natural person.

 

(iii)          Subject to acceptance and recording thereof pursuant to paragraph
(b)(iv) of this Section, from and after the effective date specified in each
Assignment and Assumption, the assignee thereunder shall be a party hereto and,
to the extent of the interest assigned by such Assignment and Assumption, have
the rights and obligations of a Lender under this Agreement, and the assigning
Lender thereunder shall, to the extent of the interest assigned by such
Assignment and Assumption, be released from its obligations under this Agreement
(and, in the case of an Assignment and Assumption covering all of the assigning
Lender’s rights and obligations under this Agreement, such Lender shall cease to
be a party hereto but shall continue to be entitled to the benefits of
Section 2.14, Section 2.15, Section 2.16 and Section 10.03).  Any assignment or
transfer by a Lender of rights or obligations under this Agreement that does not
comply with this Section 10.04 shall be treated for purposes of this Agreement
as a sale by such Lender of a participation in such rights and obligations in
accordance with paragraph (c) of this Section.

 

(iv)          The US Administrative Agent shall maintain at one of its offices a
copy of each Assignment and Assumption delivered to it and a register for the
recordation of the names and addresses of the Lenders, and the Commitment of,
and principal amount of the Loans and LC Disbursements owing to, each Lender
pursuant to the terms hereof from time to time (the “Register”).  The entries in
the Register shall be conclusive, and each Borrower, Agent, Issuing Lender and
Lender may treat each Person whose name is recorded in the Register pursuant to
the terms hereof as a Lender hereunder for all purposes of this Agreement,
notwithstanding notice to the contrary.  The Register shall be available for
inspection by each Borrower, Agent, Issuing Lender and Lender, at any reasonable
time and from time to time upon reasonable prior notice.

 

(v)           Upon its receipt of a duly completed Assignment and Assumption
executed by an assigning Lender and an assignee, the assignee’s completed
Administrative Questionnaire (unless the assignee shall already be a Lender
hereunder), the processing and recordation fee referred to in paragraph (b) of
this Section and any written consent to such assignment required by paragraph
(b) of this Section, the US Administrative Agent shall accept such Assignment
and Assumption and record the information contained therein in the Register and,
with respect to the assignment of any Euro Commitment or Loan, shall notify the
Euro Administrative Agent

 

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thereof, and with respect to any assignment of any Canadian Commitment or Loan,
shall notify the Canadian Administrative Agent thereof.  No assignment shall be
effective for purposes of this Agreement unless it has been recorded in the
Register as provided in this paragraph.

 

(c)           (i)  Any Lender may, without the consent of the Borrowers, any
Agent, any Issuing Lender or either Swingline Lender, sell participations to one
or more banks or other entities (a “Participant”) in all or a portion of such
Lender’s rights and obligations under this Agreement (including all or a portion
of its Commitment and the Loans owing to it); provided that (A) such Lender’s
obligations under this Agreement shall remain unchanged, (B) such Lender shall
remain solely responsible to the other parties hereto for the performance of
such obligations and (C) the Borrowers, the Agents, the Issuing Lenders and the
other Lenders shall continue to deal solely and directly with such Lender in
connection with such Lender’s rights and obligations under this Agreement.  Any
agreement or instrument pursuant to which a Lender sells such a participation
shall provide that such Lender shall retain the sole right to enforce this
Agreement and to approve any amendment, modification or waiver of any provision
of this Agreement; provided that such agreement or instrument may provide that
such Lender will not, without the consent of the Participant, agree to any
amendment, modification or waiver described in the first proviso to
Section 10.02(b) that affects such Participant.  Subject to paragraph (c)(ii) of
this Section, each Participant shall be entitled to the benefits and subject to
the limitations of Section 2.14, Section 2.15, and Section 2.16 to the same
extent as if it were a Lender and had acquired its interest by assignment
pursuant to paragraph (b) of this Section.  To the extent permitted by law, each
Participant also shall be entitled to the benefits of Section 10.08 as though it
were a Lender, provided such Participant agrees to be subject to Section 2.17
(c) as though it were a Lender.

 

(ii)           A Participant shall not be entitled to receive any greater
payment under Section 2.14, Section 2.15 or Section 2.16 than the applicable
Lender would have been entitled to receive with respect to the participation
sold to such Participant, unless the sale of the participation to such
Participant is made with the Parent’s prior written consent (which consent
expressly acknowledges any additional obligations of the Borrowers in respect of
Indemnified Taxes or Other Taxes).  A Participant shall not be entitled to the
benefits of Section 2.16 unless the Parent is notified of the participation sold
to such Participant and such Participant agrees, for the benefit of the Parent,
to comply with Section 2.16(e) as though it were a Lender.

 

(d)           Any Lender may at any time pledge or assign a security interest in
all or any portion of its rights under this Agreement to secure obligations of
such Lender, including without limitation any pledge or assignment to secure
obligations to a Federal Reserve Bank, and this Section shall not apply to any
such pledge or assignment of a security interest; provided that no such pledge
or assignment of a security interest shall release a Lender from any of its
obligations hereunder or substitute any such pledgee or assignee for such Lender
as a party hereto.

 

Section 10.05         Survival.  All covenants, agreements, representations and
warranties made by any of the Borrowers and Guarantors herein and in the
certificates or other instruments delivered in connection with or pursuant to
this Agreement shall be considered to have been relied upon by the other parties
hereto and shall survive the execution and delivery of this Agreement and the
making of any Loans and issuance of any Letters of Credit, regardless of any
investigation made by any such other party or on its behalf and notwithstanding
that any Agent, 

 

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Issuing Lender or other Lender may have had notice or knowledge of any Default
or incorrect representation or warranty at the time any credit is extended
hereunder, and shall continue in full force and effect as long as the principal
of or any accrued interest on any Loan or any fee or any other amount payable
under this Agreement is outstanding and unpaid or any Letter of Credit is
outstanding and so long as the Commitments have not expired or terminated.  The
provisions of Section 2.14, Section 2.15, Section 2.16 and Section 10.03 and
ARTICLE VIII shall survive and remain in full force and effect regardless of the
consummation of the transactions contemplated hereby, the repayment of the
Loans, the expiration or termination of the Letters of Credit and the
Commitments or the termination of this Agreement or any provision hereof.

 

Section 10.06         Counterparts; Integration; Effectiveness.  This Agreement
may be executed in counterparts (and by different parties hereto on different
counterparts), each of which shall constitute an original, but all of which when
taken together shall constitute a single contract.  This Agreement and any
separate letter agreements with respect to fees payable to the Agents 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 4.01, this
Agreement shall become effective when it shall have been executed by the US
Administrative Agent and when the US Administrative Agent shall have received
counterparts hereof which, when taken together, bear the signatures of each of
the other parties hereto, and thereafter shall be binding upon and inure to the
benefit of the parties hereto and their respective successors and assigns. 
Delivery of an executed counterpart of a signature page of this Agreement by
facsimile or electronic photocopy (i.e. “PDF”) shall be effective as delivery of
a manually executed counterpart of this Agreement.

 

Section 10.07         Severability.  Any provision of this Agreement held to be
invalid, illegal or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such invalidity, illegality or
unenforceability without affecting the validity, legality and enforceability of
the remaining provisions hereof; and the invalidity of a particular provision in
a particular jurisdiction shall not invalidate such provision in any other
jurisdiction.

 

Section 10.08         Right of Setoff.  If an Event of Default shall have
occurred and be continuing, each Lender and each of its Affiliates is hereby
authorized at any time and from time to time, to the fullest extent permitted by
law, to set off and apply any and all deposits (general or special, time or
demand, provisional or final) at any time held and other obligations at any time
owing by such Lender or Affiliate to or for the credit or the account of any
Borrower or any Guarantor against any and all of the obligations of such
Borrower and each Guarantor now or hereafter existing under this Agreement held
by such Lender, irrespective of whether or not such Lender shall have made any
demand under this Agreement and although such obligations may be unmatured.  The
rights of each such Lender this Section are in addition to other rights and
remedies (including other rights of setoff) which such Lender may have.

 

Section 10.09         Governing Law; Jurisdiction; Consent to Service of
Process.

 

(a)           This Agreement shall be construed in accordance with and governed
by the law of the State of New York.

 

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(b)           EACH OF THE BORROWERS AND GUARANTORS HEREBY IRREVOCABLY AND
UNCONDITIONALLY SUBMITS, FOR ITSELF AND ITS PROPERTY, TO THE NONEXCLUSIVE
JURISDICTION OF THE SUPREME COURT OF THE STATE OF NEW YORK SITTING IN NEW YORK
COUNTY AND OF THE UNITED STATES DISTRICT COURT OF THE SOUTHERN DISTRICT OF NEW
YORK, AND ANY APPELLATE COURT FROM ANY THEREOF, IN ANY ACTION OR PROCEEDING
ARISING OUT OF OR RELATING TO THIS AGREEMENT, OR FOR RECOGNITION OR ENFORCEMENT
OF ANY JUDGMENT, AND EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY AND
UNCONDITIONALLY AGREES THAT ALL CLAIMS IN RESPECT OF ANY SUCH ACTION OR
PROCEEDING MAY BE HEARD AND DETERMINED IN SUCH NEW YORK STATE OR, TO THE EXTENT
PERMITTED BY 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 SHALL AFFECT ANY RIGHT THAT THE
AGENTS, THE ISSUING LENDER OR ANY LENDER MAY OTHERWISE HAVE TO BRING ANY ACTION
OR PROCEEDING RELATING TO THIS AGREEMENT AGAINST THE ANY OF THE BORROWERS OR
GUARANTORS OR ITS PROPERTIES IN THE COURTS OF ANY JURISDICTION.

 

(c)           Each of the parties hereto hereby irrevocably and unconditionally
waives, to the fullest extent it may legally and effectively do so, any
objection which it may now or hereafter have to the laying of venue of any suit,
action or proceeding arising out of or relating to this Agreement in any court
referred to in paragraph (b) of this Section.  Each of the parties hereto hereby
irrevocably waives, to the fullest extent permitted by law, the defense of an
inconvenient forum to the maintenance of such action or proceeding in any such
court.

 

(d)           Each party to this Agreement irrevocably consents to service of
process in the manner provided for notices in Section 10.01.  Nothing in this
Agreement will affect the right of any party to this Agreement to serve process
in any other manner permitted by law.

 

Section 10.10         WAIVER OF JURY TRIAL.  EACH PARTY HERETO HEREBY 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 THE TRANSACTIONS CONTEMPLATED HEREBY (WHETHER
BASED ON CONTRACT, TORT OR ANY OTHER THEORY).  EACH PARTY HERETO (A) CERTIFIES
THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED,
EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY 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 BY,
AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.

 

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Section 10.11         Headings.  Article and Section headings and the Table of
Contents used herein are for convenience of reference only, are not part of this
Agreement and shall not affect the construction of, or be taken into
consideration in interpreting, this Agreement.

 

Section 10.12         Confidentiality.

 

(a)           Each of the Agents, the Issuing Lenders and the Lenders agrees to
maintain the confidentiality of the Information (as defined below), except that
Information may be disclosed (a) to its and its Affiliates’ directors, officers,
employees and agents, including accountants, legal counsel and other advisors
(it being understood that the Persons to whom such disclosure is made will be
informed of the confidential nature of such Information and instructed to keep
such Information confidential), (b) to the extent requested by any regulatory
authority, (c) to the extent required by applicable laws or regulations or by
any subpoena or similar legal process (provided that in the case of Information
required to be disclosed by a Person pursuant to a subpoena or similar legal
process, such Person shall use reasonable efforts to provide the Parent with
prior notice of such required disclosure and the opportunity to obtain a
protective order in respect thereof if no conflict exists with such Peron’s
governmental, regulatory or legal requirements), (d) to any other party to this
Agreement, (e) in connection with the exercise of any remedies hereunder or any
suit, action or proceeding relating to this Agreement or the enforcement of
rights hereunder, (f) subject to an agreement containing provisions
substantially the same as those of this Section, to (i) any assignee of or
Participant in, or any prospective assignee of or Participant in, any of its
rights or obligations under this Agreement, or (ii) any actual or prospective
counterparty (or its advisors) to any swap or derivative transaction relating to
any Borrower and its obligations under the Loan Documents, (g) with the consent
of the Parent or (h) to the extent such Information (i) becomes publicly
available other than as a result of a breach of this Section or (ii) becomes
available to the Agents, the Issuing Lenders or any Lender on a nonconfidential
basis from a source other than any Borrower or any of its respective
Subsidiaries.  For the purposes of this Section, “Information” means all
information received from any Borrower or any of its Subsidiaries relating to
any Borrower, any such Subsidiary or its respective business, other than any
such information that is available to the Agents, the Issuing Lenders or any
Lender on a nonconfidential basis prior to disclosure by such Borrower or such
Subsidiary, as applicable; provided that, in the case of information received
from such Borrower or such Subsidiary after the Effective Date, such information
is clearly identified at the time of delivery as confidential.  Any Person
required to maintain the confidentiality of Information as provided in this
Section shall be considered to have complied with its obligation to do so if
such Person has exercised the same degree of care to maintain the
confidentiality of such Information as such Person would accord to its own
confidential information.

 

(b)           EACH LENDER ACKNOWLEDGES THAT INFORMATION AS DEFINED IN
SECTION 10.12(a) FURNISHED TO IT PURSUANT TO THIS AGREEMENT MAY INCLUDE MATERIAL
NON-PUBLIC INFORMATION CONCERNING THE US BORROWER AND  ITS RELATED PARTIES OR
THEIR RESPECTIVE SECURITIES, AND CONFIRMS THAT IT HAS DEVELOPED COMPLIANCE
PROCEDURES REGARDING THE USE OF MATERIAL NON-PUBLIC INFORMATION AND THAT IT WILL
HANDLE SUCH MATERIAL NON-PUBLIC INFORMATION IN ACCORDANCE WITH THOSE PROCEDURES
AND APPLICABLE LAW, INCLUDING FEDERAL AND STATE SECURITIES LAWS.

 

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(c)           ALL INFORMATION, INCLUDING REQUESTS FOR WAIVERS AND AMENDMENTS,
FURNISHED BY ANY BORROWER OR THE ADMINISTRATIVE AGENT PURSUANT TO, OR IN THE
COURSE OF ADMINISTERING, THIS AGREEMENT WILL BE SYNDICATE-LEVEL INFORMATION,
WHICH MAY CONTAIN MATERIAL NON-PUBLIC INFORMATION ABOUT THE BORROWERS AND
GUARANTORS AND THEIR RELATED PARTIES OR THEIR RESPECTIVE SECURITIES. 
ACCORDINGLY, EACH LENDER REPRESENTS TO THE BORROWERS AND THE AGENTS THAT IT HAS
IDENTIFIED IN ITS ADMINISTRATIVE QUESTIONNAIRE A CREDIT CONTACT WHO MAY RECEIVE
INFORMATION THAT MAY CONTAIN MATERIAL NON-PUBLIC INFORMATION IN ACCORDANCE WITH
ITS COMPLIANCE PROCEDURES AND APPLICABLE LAW.

 

(d)           Notwithstanding the provisions of Section 10.12(b), or any other
provision of this Agreement or any Loan Document, each of the Agents, the
Issuing Lenders, the Lenders and the Obligors may disclose to any and all
Persons general information that is relevant in order to understand the tax
treatment and tax structure of the transactions contemplated by this Agreement
or any Loan Document.  For the avoidance of doubt, the preceding sentence does
not allow for the disclosure of any specific information that is not otherwise
discloseable by reason of Section 10.12(b) and that is not relevant to
understanding the tax treatment and tax structure of the transactions
contemplated by this Agreement, such as (i) the specific identity of the
Borrowers or any of its current or future Affiliates or (ii) any specific
pricing terms or any other specific nonpublic business or financial
information.  For purposes of this Section 10.12(d), the terms “tax treatment”
and “tax structure” shall have the meaning provided by Treasury Regulation
Section 1.6011-4.

 

Section 10.13         Interest Rate Limitation.  Notwithstanding anything herein
to the contrary, if at any time the interest rate applicable to any Loan or
reimbursement obligation, together with all fees, charges and other amounts that
are treated as interest on such Loan or reimbursement obligation under
applicable law (collectively the “Charges”), shall exceed the maximum lawful
rate (the “Maximum Rate”) that may be contracted for, charged, taken, received
or reserved by the Lender holding such Loan or reimbursement obligation in
accordance with applicable law, the rate of interest payable in respect of such
Loan or reimbursement obligation hereunder, together with all Charges payable in
respect thereof, shall be limited to the Maximum Rate and, to the extent lawful,
the interest and Charges that would have been payable in respect of such Loan or
reimbursement obligation but were not payable as a result of the operation of
this Section shall be cumulated and the interest and Charges payable to such
Lender in respect of other Loans, reimbursement obligations or periods shall be
increased (but not above the Maximum Rate therefor) until such cumulated amount
shall have been received by such Lender.

 

Section 10.14         USA Patriot Act.  Each Lender that is subject to the
requirements of the USA Patriot Act (Title III of Pub. L. 107-56 (signed into
law October 26, 2001)) (the “Act”), hereby notifies the Borrowers that pursuant
to the requirements of the Act, it is required to obtain, verify and record
information that identifies the Borrowers, which information includes the names
and addresses of the Borrowers and other information that will allow such Lender
to identify the Borrowers in accordance with the Act.

 

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Section 10.15         Amendment and Restatement.  Upon the Effective Date, the
Prior Agreement shall be amended, restated and superseded in its entirety by
this Agreement.  The parties hereto acknowledge and agree that (i) this
Agreement, any promissory notes delivered pursuant to Section 4.01(d) and the
other Loan Documents executed and delivered herewith do not constitute a
novation or termination of the “Obligations” as defined in the Prior Agreement
as in effect prior to the Effective Date and (ii) such “Obligations” are in all
respects continuing with only the terms thereof being modified as provided in
this Agreement.

 

Section 10.16         Exiting Lenders.  Each of Bank of America, N.A., Vectra
Bank of Colorado, National Association and U.S. Bank, N.A., as “Lenders” under
the Prior Agreement (collectively, the “Exiting Lenders”), hereby sells,
assigns, transfers and conveys to the Lenders hereto, and each of the Lenders
hereto hereby purchases and accepts, so much of the aggregate commitments under,
and loans outstanding under, the Prior Agreement such that, after giving effect
to this Agreement (a) each of the Exiting Lenders shall (i) be paid in full for
all amounts owing under the Prior Agreement as agreed and calculated by such
Exiting Lenders and the US Administrative Agent in accordance with the Prior
Agreement, (ii) cease to be a “Lender” under the Prior Agreement and the “Loan
Documents” as defined therein and (iii) relinquish its rights (provided that it
shall still be entitled to any rights of indemnification in respect of any
circumstance or event or condition arising prior to the Effective Date) and be
released from its obligations under the Prior Agreement and the other “Loan
Documents” as defined therein, (b) the Term Loan Commitments (as defined in the
Prior Agreement) of the Term Lenders (as defined in the Prior Agreement) are
hereby reallocated to the US Commitments of the US Lenders under this Agreement,
and (c) the Commitments of each Lender shall be as set forth on Schedule 2.01
hereto.  The foregoing assignments, transfers and conveyances are without
recourse to the Exiting Lenders and without any warranties whatsoever by the
Agents, the Issuing Lenders or any Exiting Lender as to title, enforceability,
collectability, documentation or freedom from liens or encumbrances, in whole or
in part, other than the warranty of each Exiting Lender that it has not
previously sold, transferred, conveyed or encumbered such interests.  The
assignee Lenders and the US Administrative Agent shall make all appropriate
adjustments in payments under the Prior Agreement, the “Notes” and the other
“Loan Documents” thereunder for periods prior to the adjustment date among
themselves.  Each of the Exiting Lenders is executing this Agreement for the
sole purpose of evidencing its agreement to this Section 10.16 only and for no
other purpose.

 

[END OF TEXT]

 

106

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

 

PARENT, US BORROWER, EURO BORROWER, CANADIAN BORROWER AND US GUARANTOR:

 

DYNAMIC MATERIALS CORPORATION

 

 

 

 

 

By:

/s/ Richard A. Santa

 

Title:

Senior Vice President and Chief Financial Officer

 

 

US BORROWER AND US GUARANTOR:

 

AMK WELDING, INC.

 

 

 

 

 

 

 

By:

/s/ Richard A. Santa

 

Title:

Vice President, Secretary and Treasurer

 

 

US BORROWER AND US GUARANTOR:

 

DMC KOREA HOLDING, INC.

 

 

 

 

 

By:

/s/ Richard A. Santa

 

Title:

Vice President

 

 

US BORROWER AND US GUARANTOR:

 

DYNAenergetics US, Inc.

 

 

 

 

 

By:

/s/ Richard A. Santa

 

Title:

Secretary

 

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

 

EURO BORROWER AND FOREIGN GUARANTOR:

 

DYNAMIC MATERIALS LUXEMBOURG 2 S.a r.L

 

 

 

 

 

By:

/s/ Richard A. Santa

 

Title:

Class B Director

 

 

EURO BORROWER AND FOREIGN GUARANTOR:

 

DYNAenergetics Holding GmbH

 

 

 

 

 

By:

/s/ Patrick Xylander

 

Title:

Managing Director

 

 

EURO BORROWER AND FOREIGN GUARANTOR:

 

DYNAenergetics Beteiligungs GmbH

 

 

 

 

 

By:

/s/ Patrick Xylander

 

Title:

Managing Director

 

 

EURO BORROWER AND FOREIGN GUARANTOR:

 

DYNAenergetics GmbH & Co KG

 

 

 

By:

DYNAenergetics Beteiligungs GmbH,
as general partner

 

 

 

 

By:

/s/ Patrick Xylander

 

Title:

Managing Director

 

 

CANADIAN BORROWER AND FOREIGN GUARANTOR:

 

DYNAenergetics Canada Inc.

 

 

 

 

 

By:

/s/ Richard A. Santa

 

Title:

Vice President

 

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

 

FOREIGN GUARANTOR:

 

DYNAenergetics NA, LLC

 

 

 

 

 

 

By:

/s/ Richard A. Santa

 

Title:

Vice President, Secretary and Treasurer

 

 

FOREIGN GUARANTOR:

 

DYNAMIC MATERIALS LUXEMBOURG 1 S.a r.L

 

 

 

 

 

By:

/s/ Richard A. Santa

 

Title:

Class B Director

 

 

FOREIGN GUARANTOR:

 

NOBELCLAD EUROPE SA

 

 

 

 

 

By:

/s/ Antoine Nobilie

 

Title:

Administrator et Directeur General

 

 

FOREIGN GUARANTOR:

 

NITRO METALL AB

 

 

 

 

 

By:

/s/ Richard A. Santa

 

Title:

Director

 

 

FOREIGN GUARANTOR:

 

DYNAenergetics SIBERIA LIMITED

 

 

 

 

 

By:

/s/ Egor Toropchanin

 

Title:

Director

 

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

 

FOREIGN GUARANTOR:

 

 

ooo PERFOLINE

 

 

 

 

 

 

 

 

 

By:

/s/ Sergey A. Starigov

 

 

Title:

General Director

 

 

FOREIGN GUARANTOR:

 

 

ooo DYNAenergetics RUS

 

 

 

 

 

 

 

 

By:

/s/ Wilhelm Sonnenberg

 

 

Title:

General Director

 

 

FOREIGN GUARANTOR:

 

 

DMC DYNAPLAT HOLDINGS GmbH

 

 

 

 

 

 

 

 

By:

/s/ Dr. Malte Veehmayer

 

 

Title:

Managing Director

 

 

FOREIGN GUARANTOR:

 

 

DMC DYNAPLAT HOLDINGS GmbH and CO., KG

 

 

 

 

 

By:

DMC DYNAPLAT HOLDINGS GmbH,
as general partner

 

 

 

 

 

 

 

 

 

 

By:

/s/ Dr. Malte Veehmayer

 

 

Title:

Managing Director

 

 

US ADMINISTRATIVE AGENT, US ISSUING LENDER, US SWINGLINE LENDER AND US LENDER:

 

 

JPMORGAN CHASE BANK, N.A

 

 

 

 

 

 

 

 

By:

/s/ Brennon Crist

 

 

Title:

Senior Vice President

 

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

 

EURO ADMINISTRATIVE AGENT, EURO ISSUING LENDER, EURO SWINGLINE LENDER AND EURO
LENDER:

 

 

J.P. MORGAN EUROPE LIMITED

 

 

 

 

 

 

 

 

By:

/s/ Lucy Butler

 

 

Title:

Vice President

 

 

CANADIAN ADMINISTRATIVE AGENT, CANADIAN ISSUING LENDER AND CANADIAN LENDER:

 

 

JPMORGAN CHASE BANK, N.A.,
TORONTO BRANCH

 

 

 

 

 

 

 

 

By:

/s/ Michael N. Tam

 

 

Title:

Senior Vice President

 

 

SYNDICATION AGENT, US LENDER, EURO LENDER AND CANADIAN LENDER:

 

 

KEYBANK NATIONAL ASSOCIATION

 

 

 

 

 

 

 

 

By:

/s/ Michelle K. Bushey

 

 

Title:

Senior Vice President

 

 

DOCUMENTATION AGENT, US LENDER AND EURO LENDER:

 

 

WELLS FARGO BANK, NATIONAL ASSOCIATION

 

 

 

 

 

 

 

 

By:

/s/ Jason Weston

 

 

Title:

Vice President

 

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

 

US LENDER, EURO LENDER AND CANADIAN LENDER:

 

BANK OF THE WEST

 

 

 

 

 

By:

/s/ Terry A. Switz

 

Title:

Vice President

 

 

EURO LENDER:

 

JPMORGAN CHASE BANK, N.A.,
LONDON BRANCH

 

 

 

 

 

By:

/s/ Lucy Butler

 

Title:

Vice President

 

 

CANADIAN LENDER:

 

WELLS FARGO FINANCIAL
CORPORATION CANADA

 

 

 

 

 

By:

/s/ Richard Valade

 

Title:

President

 

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

 

 

Acknowledged and agreed to only with
respect to Section 10.16 of the Agreement
by:

 

 

 

 

 

 

 

 

BANK OF AMERICA, N.A.

 

 

 

 

 

 

 

By:

/s/ David R. Barney

 

 

 

 

Title:

Senior Vice President

 

 

 

 

Acknowledged and agreed to only with
respect to Section 10.16
of the Agreement by:

 

 

 

 

 

 

 

 

VECTRA BANK OF COLORADO,
NATIONAL ASSOCIATION

 

 

 

 

 

 

 

By:

/s/ Malcolm R. Evans

 

 

 

 

Title:

Vice President

 

 

 

 

Acknowledged and agreed to only with
respect to Section 10.16 of the Agreement
by:

 

 

 

 

 

 

 

 

U.S. BANK, N.A.

 

 

 

 

 

 

 

By:

/s/ Greg Blanchard

 

 

 

 

Title:

Vice President

 

 

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

 

Disclosure Schedules Omitted

 

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

 

SCHEDULE 2.01

 

COMMITMENTS

 

LENDER

 

US
COMMITMENT

 

EURO
COMMITMENT

 

CANADIAN
COMMITMENT

 

JPMorgan Chase Bank, N.A.

 

$

13,200,000

 

 

 

 

 

 

J.P. Morgan Europe Limited / JPMorgan Chase Bank, N.A., London Branch(1)

 

 

 

€

5,866,667

 

 

 

 

JPMorgan Chase Bank, N.A., Toronto Branch

 

 

 

 

 

C$

550,000

 

KeyBank National Association

 

$

8,400,000

 

€

3,733,333

 

C$

350,000

 

Wells Fargo Bank, N.A.

 

$

8,400,000

 

€

3,733,333

 

 

 

 

Wells Fargo Financial Corporation Canada

 

 

 

 

 

C$

350,000

 

Bank of the West

 

$

6,000,000

 

€

2,666,667

 

C$

250,000

 

TOTAL

 

$

36,000,000

 

€

16,000,000

 

C$

1,500,000

 

 

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

(1)  For purposes of Euro Loans to the Parent, JPMorgan Chase Bank, N.A., London
Branch shall be a Euro Lender.  For purposes of Euro Loans to any other Euro
Borrower, J.P. Morgan Europe Limited shall be a Euro Lender.

 

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

 

Schedule 9.10

 

Jurisdiction Specific Provisions

 

JURISDICTION SPECIFIC PROVISIONS

 

The guaranty provisions in Article IX are further subject to the following:

 

I.                                        Parallel Debt.

 

a.                                      Each of the Euro Borrowers and Euro
Guarantors (together, “Euro Obligors”) hereby irrevocably and unconditionally
undertake to pay to the US Administrative Agent amounts equal to any amounts
owing from time to time by that Euro Obligor to any Secured Party under any of
the Loan Documents as and when those amounts are or become due; provided,
however, no Euro Obligor shall have any obligation under this clause (a) to pay
to the US Administrative Agent any amounts owing by any US Guarantor or US
Borrower to any Secured Party under any of the Loan Documents.

 

b.                                      Each Euro Obligor, the US Administrative
Agent, the Euro Administrative Agent and the Canadian Administrative Agent
acknowledge that the obligations of each Euro Obligor under section (a) above
are several and are separate and independent from, and shall not in any way
limit or affect, the corresponding Obligations of that Euro Obligor to any of
the Agents or any Secured Party under any of the Loan Documents (its
“Corresponding Debt”) nor shall the amounts for which each Euro Obligor is
liable under section (a) above (its “Parallel Debt”) be limited or affected in
any way by its Corresponding Debt provided that:

 

1.                                      the Parallel Debt of each Euro Obligor
shall be decreased to the extent that its Corresponding Debt has been paid or
(in the case of guarantee obligations) discharged;

 

2.                                      the Corresponding Debt of each Euro
Obligor shall be decreased to the extent that its Parallel Debt has been paid or
(in the case of guarantee obligations) discharged;

 

3.                                      the amount of the Parallel Debt of a
Euro Obligor shall at all times be equal to the amount of its Corresponding
Debt;

 

4.                                      the Parallel Debt owed by a German
Guarantor (as defined below) shall be subject to the same limitations set forth
below in section II below as its Corresponding Debt; and

 

5.                                      the Parallel Debt shall irrespective of
clauses 1-4 above at any time amount to at least 1 Euro.

 

c.                                       Each of the Agents acts in its own name
as an independent and separate right and not as a trustee, and its claims in
respect of the Parallel Debt shall not be held on trust.  The security granted
under the Loan Documents to the US Administrative Agent to secure the Parallel
Debt is granted to the US Administrative Agent in its capacity as agent for the
independent and separate creditors of the Parallel Debt and shall not be held on
trust.

 

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

 

d.                                      Without limiting or affecting the
Agents’ rights against the Obligors (whether under this subsection (a) or under
any other provision of the Loan Documents), each Euro Obligor acknowledges that:

 

1.                                      nothing in this subsection (a) shall
impose any obligation on any Agent to advance any sum to any Euro Obligor or
otherwise under any Loan Document, except in its capacity as a Lender; and

 

2.                                      for the purpose of any vote taken under
any Loan Document, no Agent shall be regarded as having any participation or
commitment other than those which it has in its capacity as a Lender.

 

II.                                   Limitation on German Obligors Liabilities.

 

a.                                      With a view to give due regard to the
obligations of the managing directors of any Obligor incorporated in the Federal
Republic of Germany in the form of a limited liability company (Gesellschaft mit
beschränkter Haftung) or in the form of a limited liability company
(Gesellschaft mit beschränkter Haftung) acting as general partner of a limited
partnership (Kommanditgesellschaft) (a “German Guarantor”) (aa) to duly consider
the own interest of such German Guarantor and the German Guarantor’s creditors
as well as (bb) to preserve the stated share capital (Stammkapital) of the
German Guarantor, the liability of any German Guarantor to any Secured Party
under any of the Loan Documents for Corresponding Debt or Parallel Debt
(“Relevant German Guarantee”) shall be limited if and to the extent that:

 

1.                                      the Relevant German Guarantee qualifies
a an up-stream or cross-stream security;

 

2.                                      the relevant German Guarantor guarantees
obligations of an affiliated company (verbundenes Unternehmen) of such German
Guarantor within the meaning of section 15 of the German Act on Stock
Corporations (Aktiengesetz) (other than any of that German Guarantor’s
Subsidiaries); and

 

3.                                      the enforcement of the Relevant German
Guarantee would cause the net assets of the German Guarantor to fall below or
further reduce the stated share capital (Stammkapital) of such German Guarantor
in violation of sections 30 et seq. German Act on Limited Liability Companies
(GmbH-Gesetz).

 

b.                                      The net assets under Clause II.a.3.
shall be determined in accordance with the principles for ordinary bookkeeping
at the time of the enforcement and the preparation of balance sheets as they
were consistently applied by the German Guarantor in preparing its balance
sheets in previous years, as the sum of the balance sheet positions shown under
section 266 (2) (A), (B) and (C) of the German Commercial Code
(Handelsgesetzbuch) less the sum of the balance sheet positions shown under
section 266 (3) (B), (C) (but disregarding, for the avoidance of doubt, the
obligations under the Relevant German Guarantee) and (D) of the German
Commercial Code (Handelsgesetzbuch), save for the following adjustments:

 

1.                                      any amounts resulting from an increase
of the German Guarantor’s stated share capital after the date of this Agreement
which has been effected in violation of the Loan Agreement shall be deducted
from the stated share capital; and

 

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

 

2.                                      loans and other contractual liabilities
incurred by the German Guarantor in violation of the provisions of any of the
Loan Documents shall be disregarded to the extent that such violation results
from grossly negligent or willful misconduct.

 

c.                                       The limitations set out in Clause II.a.
above shall only apply if and to the extent that

 

1.                                      within fifteen (15) Business Days
following the notification by any Agent of its intention to enforce against the
German Guarantor, the managing directors (Geschäftsführer) on behalf of the
German Guarantor have confirmed in writing to the US Administrative Agent (aa)
to what extent the Relevant German Guarantee is an up-stream or cross stream
security and (bb) which amount of such up-stream security and/or cross-stream
cannot be enforced as it would cause the net assets of the German Guarantor to
fall below its stated share capital in violation of sections 30 et seq. German
Act on Limited Liability Companies (GmbH-Gesetz) and such confirmation is
supported by conclusive evidence (the “Management Determination”); and

 

2.                                      (x) none of the Agents (acting on the
instructions of the Secured Parties) has contested the Management Determination
by arguing that no or a lesser amount would be necessary to maintain its stated
share capital within fifteen (15) Business Days following the Management
Determination, or (y) within thirty-five (35) Business Days from the date any
Agent has contested the Management Determination, the US Administrative Agent
receives a determination by auditors of international standard and reputation
(“Auditor’s Determination”) appointed by the German Guarantor of the amount that
would have been necessary to maintain its stated share capital without violation
of sections 30 et seq. German Act on Limited Liability Companies (GmbH-Gesetz).

 

d.                                      If and to the extent that the Relevant
German Guarantee has been enforced without regard to the limitations set out in
Clause II. A. above because (i) the Management Determination or Auditor’s
Determination was not delivered within the relevant time frame or (ii) the
realizable amount pursuant to the Auditor’s Determination is lower than the
respective amount stated in the Management Determination, the US Administrative
Agent shall upon written demand of the German Guarantor (procure to) repay to
the German Guarantor any amount required to maintain such German Guarantor’s
stated share capital (Stammkapital) in accordance with sections 30 et seq. of
the German Limited Liability Company Act (GmbH-Gesetz).

 

e.                                       If the US Administrative Agent
disagrees with the Auditor’s Determination it shall notify the German Guarantor
accordingly.  The Secured Parties shall only be entitled to enforce the Relevant
German Guarantee up to the amount which is undisputed between themselves and the
German Guarantor in accordance with the provisions of Clause II.  In relation to
the amount which is disputed between the US Administrative Agent and the German
Guarantor, the Secured Parties shall be entitled to further pursue claims (if
any) in court.

 

f.                                        In an enforcement situation the German
Guarantor shall, upon the written request of the US Administrative Agent and to
the extent legally permitted, for the purposes of the determination of its net
assets dispose of all assets which are shown in the balance sheet of the

 

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

 

German Guarantor with a book value (Buchwert) which is significantly lower than
the market value of such asset if such asset is not necessary for the operation
of its business (nicht betriebsnotwendig) and to the extent it can be realized
commercially justifiable.

 

g.                                       The Relevant German Guarantee shall be
limited if and to the extent that the payment or enforcement of such liability
would cause the managing directors’ (Geschäftsführer) liability of such German
Guarantor or its general partner under section 64 sentence 3 of the German Act
on Limited Liability Companies (GmbH-Gesetz) or section 130a para 1 sentence 3
of the German Commercial Code (Handelsgesetzbuch), respectively.  The US
Administrative Agent agrees to enforce any Relevant German Guarantee of a German
Guarantor only to the extent that the managing directors (Geschäftsführer) of
the German Obligor or its general partner are not or will not become liable as a
result of the enforcement pursuant to section 64 sentence 3 of the German Act on
Limited Liability Companies (GmbH-Gesetz) or section 130a para 1 sentence 3 of
the German Commercial Code (Handelsgesetzbuch), respectively.

 

h.                                      The Relevant German Guarantee shall be
limited if and to the extent that the payment or enforcement of such liability
would threaten the corporate existence of the German Guarantor pursuant to the
German concept of destructive interference (existenzvernichtender Eingriff). 
The US Administrative Agent agrees to enforce the liability only to the extent
that such enforcement would not result in a threat to the corporate existence of
the German Guarantor pursuant to the German concept of destructive interference
(existenzvernichtender Eingriff).

 

III.                              Limitation on French Guarantor’s liabilities:

 

a.                                      The obligations and liabilities of any
Guarantor incorporated under the laws of France (a “French Guarantor”) hereunder
shall not extend to the payment obligations of any Obligor incorporated in the
United States of America or any other jurisdiction other than France.

 

b.                                      The obligations and liabilities of any
French Guarantor hereunder shall not include, and shall not be construed as
including, any obligation or liability which if incurred would breach any
provisions of financial assistance as defined by article L.225-216 of the French
Commercial Code (Code de Commerce) for the guarantee, or the subscription, or
the acquisition, or the financing, or the refinancing of the acquisition,
directly or indirectly, of its own shares.

 

c.                                       Notwithstanding anything to the
contrary in this Agreement, the liabilities of any French Guarantor hereunder
shall at any time be limited:

 

(x)                                 regarding any Obligor which is a Subsidiary
of the French Guarantor, to a guarantee of such Subsidiary’s total payment
obligations to the Finance Parties under the Finance Documents (subject always
to the provisions of paragraphs (i) and (ii) above); and

 

(y)                                 regarding any Obligor which is not a
Subsidiary of the French Guarantor, to a guarantee of such Obligor’s payment
obligations up to the aggregate outstanding principal amount (if any) borrowed
by such French Guarantor from such Obligor, to the extent such borrowed amounts
remain outstanding at the time of enforcement of such guarantee (subject always
to the provisions of paragraph (i) above).

 

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

 

d.                                      For the avoidance of doubt, it is
acknowledged that the French Guarantors are not “co-débiteurs solidaires” as to
their obligations pursuant to the guarantees given pursuant to Article IX.

 

IV.                               Limitation on Swedish Obligors Liability.

 

a.                                      The obligations of each Euro Guarantor
that is incorporated under the laws of Sweden shall under Article IX be limited
if (and only if) required by an application of the provisions of the Swedish
Companies Act (Sw. aktiebolagslagen (2005:551)) in force from time to time
regulating the purpose of a company’s business, prohibited loans and guarantees
and distribution of assets (including profits/dividends) and it is understood
that the liability of any such Swedish Euro Guarantor under Article IX only
applies to the extent permitted by the above mentioned provisions of the Swedish
Companies Act.

 

b.                                      The termination and release of any Lien
created under the laws of Sweden shall require the prior consent of the
Administrative Agent (such consent not to be unreasonably withheld).

 

V.                                    Limitation on Luxembourg Obligors
Liability.  The obligations of each Guarantor incorporated in Luxembourg (a
“Luxembourg Guarantor”) under Article IX (Guarantee) for the obligations under
the Loan Documents of any Obligor that is not a direct or indirect subsidiary of
such Luxembourg Guarantor shall be limited to an aggregate amount not exceeding:

 

a.                                      The greater of (x) 95% of such
Luxembourg Guarantor’s net assets (capitaux propres) (as referred to in article
34 of the Luxembourg Law dated 19 December 2002) as at the date on which a
demand under the guarantee in Article IX (Guarantee) is made; and (y) 95% of
such Luxembourg Guarantor’s net assets (capitaux propres) (as referred to in
article 34 of the Luxembourg Law dated 19 December 2002) as at the date of this
Agreement; and

 

b.                                      Any other advances, loans or moneys made
available to the Luxembourg Guarantor by any of its Affiliates.

 

The above limitation does not apply to any amount lent to the Luxembourg
Guarantor or to any of its direct or indirect Subsidiaries (regardless of the
form thereof), where such amount lent is financed directly or indirectly by a
borrowing under the Loan Documents.

 

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

 

EXHIBIT 1.1A

 

FORM OF
ASSIGNMENT AND ASSUMPTION

 

Reference is made to the Amended and Restated Credit Agreement dated as of
December 21, 2011 (as amended and in effect on the date hereof, the “Credit
Agreement”), among Dynamic Materials Corporation, the US Borrowers party
thereto, the Euro Borrowers party thereto, the Canadian Borrowers party thereto,
the Guarantors party thereto, the Lenders party thereto, JPMorgan Chase Bank,
N.A., as US Administrative Agent, J.P. Morgan Europe Limited, as Euro
Administrative Agent, JPMorgan Chase Bank, N.A., Toronto Branch, as Canadian
Administrative Agent, KeyBank National Association, as Syndication Agent and
Wells Fargo Bank, N.A., as Documentation Agent.  Terms defined in the Credit
Agreement are used herein with the same meanings.

 

The Assignor named below hereby sells and assigns, without recourse, to the
Assignee named below, and the Assignee hereby purchases and assumes, without
recourse, from the Assignor, effective as of the Assignment Date inserted by the
US Administrative Agent as contemplated below, the interests set forth below
(the “Assigned Interest”) in the Assignor’s rights and obligations under the
Credit Agreement, including, without limitation, the interests set forth below
in the Commitment of the Assignor on the Assignment Date and US Loans, Euro
Loans and Canadian Loans owing to the Assignor which are outstanding on the
Assignment Date, together with the participations in US Letters of Credit, Euro
Letters of Credit, Canadian Letters of Credit, US LC Disbursements, Euro LC
Disbursements, Canadian LC Disbursements, US Swingline Loans and Euro Swingline
Loans held by the Assignor on the Assignment Date, but excluding accrued
interest and fees to and excluding the Assignment Date.  The Assignee hereby
acknowledges receipt of a copy of the Credit Agreement.  From and after the
Assignment Date (i) the Assignee shall be a party to and be bound by the
provisions of the Credit Agreement and, to the extent of the Assigned Interest,
have the rights and obligations of a US Lender, a Euro Lender and a Canadian
Lender thereunder and (ii) the Assignor shall, to the extent of the Assigned
Interest, relinquish its rights and be released from its obligations under the
Credit Agreement.

 

This Assignment and Assumption is being delivered to the Administrative Agent
together with (i) any documentation required to be delivered by the Assignee
pursuant to Section 10.04(b)(ii) of the Credit Agreement, duly completed and
executed by the Assignee, and (ii) if the Assignee is not already a Lender under
the Credit Agreement, an Administrative Questionnaire, duly completed by the
Assignee.  The [Assignee/Assignor] shall pay the fee payable to the
Administrative Agent pursuant to Section 10.04(b)(ii)(C) of the Credit
Agreement.

 

This Assignment and Assumption shall be governed by and construed in accordance
with the laws of the State of New York.

 

Legal Name of Assignor:

 

Legal Name of Assignee:

 

Exhibit 1.1A-1

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

 

Assigned Interest:

 

Commitment Assigned

 

Principal Amount Assigned

 

Percentage Assigned of
Commitment (set forth, to at
least 8 decimals, as a
percentage of the aggregate
Commitments of all
Lenders thereunder)

 

US Commitment

 

$

 

 

 

%

Euro Commitment

 

€

 

 

 

%

Canadian Commitment

 

C$

 

 

%

 

[Signature Pages follow]

 

Exhibit 1.1A-2

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

 

Assignment Date:                   , 20       [TO BE INSERTED BY US
ADMINISTRATIVE AGENT AND WHICH SHALL BE THE EFFECTIVE DATE OF RECORDATION OF
TRANSFER IN THE REGISTER THEREFOR.]

 

The terms set forth above are hereby agreed to:

 

 

ASSIGNOR:

 

 

 

[NAME OF ASSIGNOR]

 

 

 

 

 

By:

 

 

Name:

 

 

Title:

 

 

 

 

 

 

ASSIGNEE:

 

 

 

[NAME OF ASSIGNEE]

 

 

 

 

 

By:

 

 

Name:

 

 

Title:

 

 

Exhibit 1.1A-3

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

 

The undersigned hereby consent to the within assignment:

 

[DYNAMIC MATERIALS CORPORATION,

as Parent

 

 

By:

 

 

Name:

 

 

Title:

 

](1)

 

 

[JPMORGAN CHASE BANK, N.A.,

as US Administrative Agent

 

 

By:

 

 

Name:

 

 

Title:

 

](2)

 

 

JPMORGAN CHASE BANK, N.A.,

as US Issuing Lender and US Swingline Lender

 

 

By:

 

 

Name:

 

 

Title:

 

 

 

 

J.P. MORGAN EUROPE LIMITED,

as Euro Issuing Lender and Euro Swingline Lender

 

By:

 

 

Name:

 

 

Title:

 

 

 

 

JPMORGAN CHASE BANK, N.A., TORONTO BRANCH,

as Canadian Issuing Lender

 

 

By:

 

 

Name:

 

 

Title:

 

 

 

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

(1)  Consent to be included to the extent required by Section 10.01(b)(i)(A) of
the Credit Agreement.

(2)  Consent to be included to the extent required by Section 10.04(b)(i)(B) of
the Credit Agreement.

 

Exhibit 1.1A-4

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

 

EXHIBIT 1.1B(i)

 

FORM OF
JOINDER AGREEMENT
(Domestic)

 

ADDENDUM AND JOINDER TO
CREDIT AGREEMENT
(US Security Agreement; Section 5.09(a)(ii))(3)

 

This ADDENDUM AND JOINDER TO CREDIT AGREEMENT (this “Addendum”) is entered into
by                             , a                 (the “New Subsidiary”),
[                  , a                                (the “New Subsidiary
Parent”)](4) and DYNAMIC MATERIALS CORPORATION, a Delaware corporation (the
“Parent”) in favor of JPMORGAN CHASE BANK, N.A., as US Administrative Agent
under the Credit Agreement (in such capacity, the “Agent”).

 

WHEREAS, the Parent, the US Borrowers party thereto, the Euro Borrowers party
thereto, the Canadian Borrower party thereto, the Guarantors party thereto, the
Lenders, the Agent, J.P. Morgan Europe Limited, as Euro Administrative Agent,
JPMorgan Chase Bank, N.A., Toronto Branch, as Canadian Administrative Agent,
KeyBank National Association, as Syndication Agent and Wells Fargo Bank, N.A.,
as Documentation Agent (collectively, the “Original Parties”), entered into that
certain Amended and Restated Credit Agreement dated as of December 21, 2011 (as
the same has been or may be amended, modified or supplemented from time to time,
the “Credit Agreement”);

 

WHEREAS, the Parent and the Wholly Owned Subsidiaries of the Parent that are
Domestic Subsidiaries all or substantially all of the assets of which do not
consist of stock or securities in one or more Foreign Subsidiaries are parties
to that certain Security and Pledge Agreement dated as of November 16, 2007, by
and among the Parent, the Wholly Owned Domestic Subsidiaries party thereto and
the Agent (as the same has been or may be amended, modified or supplemented, the
“Security Agreement”);

 

WHEREAS, the New Subsidiary is required to execute this Addendum pursuant to
Section 5.09(a)(ii) of the Credit Agreement; and

 

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

(3) This form may be modified as may be necessary or appropriate to provide for
the use of this form to join more than one New Subsidiary; provided that the
form, as modified, is satisfactory to the Agent in its reasonable discretion. 
This form may also be modified as may be necessary or appropriate to provide for
the addition of Equity Interests in a New Subsidiary as Collateral under the
Security Agreement without adding the New Subsidiary as a Debtor under the
Security Agreement or a party to the Credit Agreement if the New Subsidiary is a
Foreign Subsidiary or a Domestic Subsidiary the assets of which are all or
substantially all comprised of stock or securities in one or more Foreign
Subsidiaries and such New Subsidiary is executing a separate Addendum to become
a party to the Credit Agreement and to the security agreement to which the
Foreign Guarantors are parties.

 

(4) Include if Parent is not the immediate parent of New Subsidiary.

 

Exhibit 1.1B(i)-1

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

 

WHEREAS, the New Subsidiary desires to become a party to the Credit Agreement
and the Security Agreement and to receive all the benefits of and to become
subject to the obligations thereof as a US Guarantor;

 

NOW, THEREFORE, in consideration of the benefits to be derived by the
New Subsidiary under the Credit Agreement as a US Guarantor and for Ten Dollars
($10.00) and other valuable consideration, the receipt and sufficiency of which
is hereby acknowledged, the above-named parties agree as follows:

 

1.                                       Terms.  Capitalized terms used herein
and not defined herein have the same meanings assigned to such terms in the
Credit Agreement.

 

2.                                       Joinder.  By executing and delivering
this Addendum, the New Subsidiary hereby (i) becomes a party to the Credit
Agreement as a US Guarantor and the Security Agreement as a Debtor as if the New
Subsidiary had originally signed the Credit Agreement and Security Agreement and
(ii) expressly assumes all obligations and liabilities of a “US Guarantor” or
“Debtor” thereunder, as applicable.  In furtherance thereof, the New Subsidiary
hereby unconditionally and irrevocably guarantees the full and punctual payment
(whether at stated maturity, upon acceleration or otherwise) of the principal of
and interest on the US Loans, the Euro Loans and the Canadian Loans, and the
full and punctual payment of all other Obligations payable by the US Borrowers,
the Euro Borrowers, the Canadian Borrower, any Foreign Guarantor or any other US
Guarantor under the Loan Documents, upon the terms and conditions set forth in
the Credit Agreement after giving effect to this Addendum.

 

3.                                       Updated Information (Credit
Agreement).  Concurrently with this Addendum, the New Subsidiary is delivering a
completed New Subsidiary Information List, as attached in Attachment A hereto. 
The Parent and the New Subsidiary acknowledge and agree that Schedules 3.01,
3.03, 3.05, 3.06, 3.07, 3.08, 3.09, 3.10, 3.12, 6.02, 6.05, 6.08(j) and 6.09 of
the Credit Agreement, as updated by the information with respect to the New
Subsidiary reflected on the corresponding schedules of the New Subsidiary
Information List and any other relevant information, are true, accurate and
complete representations of the information described and referenced in the
corresponding sections of the Credit Agreement, after giving effect to this
Addendum.  The New Subsidiary hereby confirms that the representations and
warranties set forth in Article III of the Credit Agreement applicable to it or
its New Subsidiary Collateral (as defined below) are true and correct with
respect to the New Subsidiary and the New Subsidiary Collateral, after giving
effect to this Addendum.  Any phrase stating “as of the date hereof” or any
similar phrase in its representations and warranties set forth in the Credit
Agreement is intended to apply as of the date of this Addendum with respect to
the New Subsidiary.

 

4.                                       Updated Information (Security
Documents).

 

a.                                       [Each of the] [The] Parent [and New
Subsidiary Parent] acknowledges and agrees that Annex 1 of the Security
Agreement, as updated to add the information with respect to the [New
Subsidiary] Parent’s Equity Interests (as defined in the Security Agreement) in
the New Subsidiary set forth on Attachment B hereto and any other relevant
information, is a true, accurate and complete representation of the information
described and referenced in the corresponding sections of the Security
Agreement, after giving effect to this Addendum.  The

 

Exhibit 1.1B(i)-2

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

 

[New Subsidiary] Parent hereby confirms that the representations and warranties
set forth in Article IV of the Security Agreement with respect to the New
Subsidiary Parent Collateral (as defined below) are true and correct with
respect to the New Subsidiary Parent Collateral, after giving effect to this
Addendum.  Any phrase stating “as of the date hereof” or any similar phrase in
its representations and warranties set forth in Article IV of the Security
Agreement insofar as they relate to the New Subsidiary Parent Collateral is
intended to apply as of the date of this Addendum with respect to the New
Subsidiary Parent Collateral.

 

b.                                      Each of the Parent and the New
Subsidiary acknowledges and agrees that Annexes 1 through 14, inclusive, of the
Security Agreement, as updated to add the information with respect to the New
Subsidiary and the New Subsidiary Collateral set forth on the corresponding
Annexes of the New Subsidiary Information List attached in Attachment A hereto
and any other relevant information, are true, accurate and complete
representations of the information described and referenced in the corresponding
sections of the Security Agreement, after giving effect to this Addendum.  The
New Subsidiary hereby confirms that the representations and warranties set forth
in Article IV of the Security Agreement applicable to the New Subsidiary and the
New Subsidiary Collateral are true and correct with respect to the New
Subsidiary and the New Subsidiary Collateral, after giving effect to this
Addendum.  Any phrase stating “as of the date hereof” or any similar phrase in
its representations and warranties set forth in the Security Agreement is
intended to apply as of the date of this Addendum with respect to the New
Subsidiary and the New Subsidiary Collateral.

 

5.                                       Security Interest ([New Subsidiary]
Parent).  As collateral security for the prompt payment in full when due
(whether at stated maturity, by acceleration or otherwise) and performance of
the Secured Obligations (as defined in the Security Agreement), the [New
Subsidiary] Parent hereby grants to the Agent for the benefit of the Secured
Parties (as defined in the Security Agreement) a security interest in all of the
[New Subsidiary] Parent’s right, title and interest in, to and under the
following property, whether now owned or hereafter acquired by the [New
Subsidiary] Parent and whether now existing or hereafter coming into existence
and wherever located (collectively, the “New Subsidiary Parent Collateral”): 
(a) all Securities Collateral (as defined in the Security Agreement) described
on Attachment B to this Addendum, and (b) all Proceeds (as defined in the
Security Agreement) of such Securities Collateral, pursuant to and in accordance
with the terms of the Security Agreement (and all such New Subsidiary Parent
Collateral shall be “Collateral” for purposes of the Security Agreement);
provided, that neither the New Subsidiary Parent Collateral nor the Collateral
shall include any Excluded Equity Interests (as defined in the Security
Agreement) or any of the dividends, distributions, returns of capital, cash,
warrants, options, rights, instruments, rights to vote or manage or any other
property or proceeds from time to time received, receivable or otherwise
distributed in respect of or in exchange for any or all of the Excluded Equity
Interests.

 

6.                                       Security Interest (New Subsidiary).  As
collateral security for the prompt payment in full when due (whether at stated
maturity, by acceleration or otherwise) and performance of the Secured
Obligations (as defined in the Security Agreement), the New Subsidiary hereby
grants to the Agent for the benefit of the Secured Parties (as defined in the
Security Agreement) a security interest in all of the New Subsidiary’s right,
title and interest in, to and under the following property, whether now owned or
hereafter acquired by the New Subsidiary and whether now existing or hereafter
coming into existence and wherever located (collectively, the “New

 

Exhibit 1.1B(i)-3

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

 

Subsidiary Collateral”):  (a) all Securities Collateral (as defined in the
Security Agreement) described on Attachment C to this Addendum, (b) all other
Collateral (as defined in the Security Agreement) described in the Security
Agreement and (c) all Proceeds (as defined in the Security Agreement) of such
Collateral, pursuant to and in accordance with the terms of the Security
Agreement (and all such New Subsidiary Collateral shall be “Collateral” for
purposes of the Security Agreement); provided, that neither the New Subsidiary
Collateral nor the Collateral shall include any Excluded Equity Interests (as
defined in the Security Agreement) or any of the dividends, distributions,
returns of capital, cash, warrants, options, rights, instruments, rights to vote
or manage or any other property or proceeds from time to time received,
receivable or otherwise distributed in respect of or in exchange for any or all
of the Excluded Equity Interests.

 

7.                                       Authorization to Take Further Action. 
The New Subsidiary and the [New Subsidiary] Parent hereby authorize the Agent to
file such financing statements as may be necessary or desirable to perfect the
Liens under the Security Agreement and any modification, extension or
ratification thereof.

 

8.                                       Reliance.  All parties hereto
acknowledge that the Agents and the Lenders are relying on this Addendum, the
accuracy of the statements herein contained and the performance of the
conditions placed upon the New Subsidiary hereunder, and that, but for the
execution of this Addendum by said parties, the Agents and the Lenders would not
allow the New Subsidiary to become party to the Credit Agreement.  The New
Subsidiary does hereby covenant and agree that it will execute such further
documents and undertake any such measure as may be necessary to effect and carry
out the terms of this Addendum and the implementation thereof.

 

9.                                       Warranties.  The New Subsidiary
(a) represents and warrants that it is legally authorized to enter into this
Addendum, and (b) confirms that it is a Wholly Owned Subsidiary of the Parent
and that it is a Domestic Subsidiary all or substantially all of the assets of
which do not consist of stock or securities in one or more Foreign Subsidiaries.

 

10.                                 Choice of Law.  This Addendum shall be
governed by, and construed in accordance with, the laws of the State of New
York, without regard to conflicts of law principles.

 

11.                                 Ratification; Conflicts.  Any and all
conflicts or inconsistencies between the terms and provisions of this Addendum
and the Credit Agreement shall be governed and controlled by the terms and
provisions of this Addendum.  Except as modified hereby, the Credit Agreement
and the Security Agreement remain in full force and effect according to their
terms.

 

12.                                 Effectiveness.  Upon execution of this
Addendum by the New Subsidiary, this Addendum shall become immediately effective
and enforceable as to such New Subsidiary and all of the Original Parties.

 

[Signature Page Follows]

 

Exhibit 1.1B(i)-4

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

 

IN WITNESS WHEREOF, the parties have executed this Addendum and agreed to the
provisions contained herein effective as of                              ,
20              .

 

 

NEW SUBSIDIARY:

                                                                                                                 ,

 

a                                    

 

 

 

By:

 

 

 

 

 

Name:

 

 

Title:

 

 

 

 

 

[NEW SUBSIDIARY PARENT

                                                                                                            ,

 

a                                  

 

 

 

By:

 

 

 

 

 

 

 

 

Name:

 

 

Title:

 

]

 

 

 

 

 

 

 

 

PARENT:

DYNAMIC MATERIALS CORPORATION,

 

a Delaware corporation

 

 

 

By:

 

 

 

 

 

Name:

 

 

Title:

 

 

Exhibit 1.1B(i)-5

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

 

ATTACHMENT A

 

ADDITIONAL INFORMATION REGARDING THE NEW SUBSIDIARY

 

The following Schedules as described in the Credit Agreement:

 

Schedule 3.01

 

Organization

Schedule 3.03

 

No Violations

Schedule 3.05

 

No Undisclosed Liabilities

Schedule 3.06

 

Litigation

Schedule 3.07

 

Compliance with Law

Schedule 3.08

 

Material Contracts

Schedule 3.09

 

Properties

Schedule 3.10

 

Intellectual Property

Schedule 3.12

 

Environmental Compliance

Schedule 6.02

 

Existing Liens

Schedule 6.05

 

Permitted Investments

Schedule 6.08(j)

 

Permitted Affiliate Agreements

Schedule 6.09

 

Restrictive Agreements

 

The following Annexes as described in the Security Agreement:

 

Annex 1

 

Intellectual Property Licenses

Annex 2

 

Patent Collateral

Annex 3

 

Securities Collateral

Annex 4

 

Trademark Collateral

Annex 5

 

Filing Offices

Annex 6

 

Debtor Information

Annex 7

 

Previous Names and Transactions

Annex 8

 

Offices and Locations of Records

Annex 9

 

Deposit Accounts

Annex 10

 

Securities Accounts and Commodity Accounts

Annex 11

 

Instruments and Tangible Chattel Paper

Annex 12

 

Electronic Chattel Paper

Annex 13

 

Letters of Credit

Annex 14

 

Commercial Tort Claims

 

Exhibit 1.1B(i)-6

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

 

 

Entity Documents

Provide a copy of all that apply:

 

Corporation:

 

Filed Articles of Incorporation/Amendments and Bylaws/Resolutions with
Incumbency Certificate

Partnership:

 

Partnership Agreement and filed/recorded Certificate of Partnership

Limited Liability Company (LLC):

 

Article of Organization and Operating Agreement/Member or Manager Consent with
Incumbency Certificate

Limited Liability Partnership (LLP):

 

Certificate of registered partnership and partnership agreement

Fictitious Name Filing:

 

Trade Name-Entities doing business under fictitious name; if applicable

 

Exhibit 1.1B(i)-7

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

 

ATTACHMENT B

 

EQUITY INTERESTS OWNED BY THE [NEW SUBSIDIARY] PARENT IN THE NEW SUBSIDIARY

 

Exhibit 1.1B(i)-8

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

 

ATTACHMENT C

 

EQUITY INTERESTS OWNED BY THE NEW SUBSIDIARY
IN ITS WHOLLY OWNED SUBSIDIARIES

 

Exhibit 1.1B(i)-9

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

 

EXHIBIT 1.1(B)(ii)

 

FORM OF
JOINDER AGREEMENT
(Foreign)

 

ADDENDUM AND JOINDER TO
CREDIT AGREEMENT
(Foreign Security Agreement; Sections 5.09(a)(i), Section 5.09(b),
Section 5.09(c))(5)

 

This ADDENDUM AND JOINDER TO CREDIT AGREEMENT (this “Addendum”) is entered into
by                                    , a
                                          (the “New Subsidiary”)
[                           , a                                     (the “New
Subsidiary Parent”)](6) and DYNAMIC MATERIALS CORPORATION, a Delaware
corporation (the “Parent”) in favor of JPMORGAN CHASE BANK, N.A., as US
Administrative Agent under the Credit Agreement (in such capacity, the “US
Agent”) [and J.P. MORGAN EUROPE LIMITED, as Euro Administrative Agent under the
Credit Agreement (in such capacity, the “Euro Agent”)].

 

WHEREAS, the Parent, the US Borrowers party thereto, the Euro Borrowers party
thereto, the Canadian Borrower party thereto, the Guarantors party thereto, the
Lenders, the Agent, J.P. Morgan Europe Limited, as Euro Administrative Agent,
JPMorgan Chase Bank, N.A., Toronto Branch, as Canadian Administrative Agent,
KeyBank National Association, as Syndication Agent and Wells Fargo Bank, N.A.,
as Documentation Agent (collectively, the “Original Parties”), entered into that
certain Amended and Restated Credit Agreement dated as of December 21, 2011 (as
the same has been or may be amended, modified or supplemented from time to time,
the “Credit Agreement”);

 

WHEREAS, the Euro Borrowers, the Canadian Borrower and the Wholly Owned
Subsidiaries of the Parent that are Foreign Subsidiaries and the Wholly Owned
Subsidiaries of the Parent that are Domestic Subsidiaries all or substantially
all of the assets of which consist of stock or securities in one or more Foreign
Subsidiaries are parties to that certain Security and Pledge Agreement dated as
of November 16, 2007, by and among Dynamic Materials Luxembourg 2 S.á r.l., the
Wholly Owned Foreign Subsidiaries party thereto and the Agent (as the same has
been or may be amended, modified or supplemented, the “Security Agreement”);

 

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

(5)  This form may be modified as may be necessary or appropriate to provide for
the use of this form to join more than one New Subsidiary; provided that the
form, as modified, is satisfactory to the US Agent in its reasonable discretion.

 

(6)  If the immediate parent of the New Subsidiary is the Parent, the Parent
will not grant any security interests pursuant to this Addendum, but will
execute an addendum to the Security Agreement to which the Parent is a party for
purposes of adding a portion of the Equity Interests of the New Subsidiary as
collateral under such Security Agreement.  If the New Subsidiary Parent is a
Domestic Subsidiary the assets of which are not all or substantially all
comprised of stock or securities in one or more Foreign Subsidiaries, the New
Subsidiary Parent will not be a party to this Addendum, but will execute an
addendum to the Security Agreement to which the New Subsidiary Parent is a party
for purposes of adding a portion of the Equity Interests of the New Subsidiary
as collateral under such Security Agreement.

 

Exhibit 1.1B(ii)-1

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

 

[WHEREAS, the New Subsidiary owns 100% of the Equity Interests in
                                , which is an entity organized under the laws of
                            and intends to join that certain Share Pledge
Agreement governed by the laws of such jurisdiction and entered into by
                                (the “Share Pledge Agreement”);(7)]

 

[WHEREAS, the New Subsidiary Parent owns 100% of the Equity Interests in the New
Subsidiary, and intends to add such Equity Interests to the collateral under the
Share Pledge Agreement;](8)

 

WHEREAS, the New Subsidiary is required to execute this Addendum pursuant to
Section [5.09(a)(i)/5.09(b)/5.09(c)] of the Credit Agreement; and

 

WHEREAS, the New Subsidiary desires to become a party to the Credit Agreement
[and][,] Security Agreement [and Share Pledge Agreement] and to receive all the
benefits of and to become subject to the obligations thereof as a Foreign
Guarantor;

 

NOW, THEREFORE, in consideration of the benefits to be derived by the New
Subsidiary under the Credit Agreement as a Foreign Guarantor and for Ten Dollars
($10.00) and other valuable consideration, the receipt and sufficiency of which
is hereby acknowledged, the above-named parties agree as follows:

 

1.             Terms.  Capitalized terms used herein and not defined herein have
the same meanings assigned to such terms in the Credit Agreement.

 

2.             Joinder.  By executing and delivering this Addendum, the New
Subsidiary hereby (i) becomes a party to the Credit Agreement as a Foreign
Guarantor [and][,] the Security Agreement as a Debtor [and the Share Pledge
Agreement as a party thereunder] as if the New Subsidiary had originally signed
the Credit Agreement [and][,] Security Agreement [and Share Pledge Agreement]
and (ii) expressly assumes all obligations and liabilities of a “Foreign
Guarantor” [or][,] “Debtor” [or “pledgor”] thereunder, as applicable.  In
furtherance thereof, the New Subsidiary hereby unconditionally and irrevocably
guarantees the full and punctual payment (whether at stated maturity, upon
acceleration or otherwise) of the principal of and interest on the Euro Loans
and the Canadian Loans, and the full and punctual payment of all other
Obligations payable by the Euro Borrowers, the Canadian Borrower or any other
Foreign Guarantor under the Loan Documents, upon the terms and conditions set
forth in the Credit Agreement after giving effect to this Addendum.

 

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

(7)  The New Subsidiary will join existing Share Pledge Agreement to the extent
permitted under applicable laws; in the event a pledge is required under a new
jurisdiction or a joinder cannot be effective pursuant to this Addendum, the New
Subsidiary will execute a new Share Pledge Agreement.  All optional language
regarding the Share Pledge Agreement will be used only to the extent a new Share
Pledge Agreement is not executed.  The New Subsidiary will not be required to
execute a new Share Pledge Agreement or join an existing Share Pledge Agreement
if it does not have a Wholly Owned Subsidiary.

 

(8)  The New Subsidiary Parent will not add collateral to the Share Pledge
Agreement if an addition cannot be effective pursuant to this Addendum.  In such
event, the New Subsidiary Parent will not be a party to this Addendum and will
execute a new Share Pledge Agreement.  All optional language with respect to
adding collateral under a Share Pledge Agreement will be used only to the extent
applicable.

 

Exhibit 1.1B(ii)-2

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

 

3.             Updated Information (Credit Agreement).  Concurrently with this
Addendum, the New Subsidiary is delivering a completed New Subsidiary
Information List, as attached in Attachment A hereto.  The Parent and the New
Subsidiary acknowledge and agree that Schedules 3.01, 3.03, 3.05, 3.06, 3.07,
3.08, 3.09, 3.10, 3.12, 6.02, 6.05, 6.08(j) and 6.09 of the Credit Agreement,
and, if the New Subsidiary is formed or organized under the laws of a
jurisdiction with respect to which jurisdiction specific guarantee limitations
are set forth on Schedule 9.10 of the Credit Agreement, Schedule 9.10 of the
Credit Agreement, as updated to add the information with respect to the New
Subsidiary reflected on the corresponding schedules of the New Subsidiary
Information List and any other relevant information, are true, accurate and
complete representations of the information described and referenced in the
corresponding sections of the Credit Agreement, after giving effect to this
Addendum.  The New Subsidiary hereby confirms that the representations and
warranties set forth in Article III of the Credit Agreement applicable to it or
its New Subsidiary Collateral are true and correct with respect to the New
Subsidiary and the New Subsidiary Collateral (as defined below), after giving
effect to this Addendum.  Any phrase stating “as of the date hereof” or any
similar phrase in its representations and warranties set forth in the Credit
Agreement is intended to apply as of the date of this Addendum with respect to
the New Subsidiary.

 

4.             Updated Information (Security Documents).

 

(a)           [Each of the] [The] Parent [and New Subsidiary Parent]
acknowledges and agrees that Annex 1 of the Security Agreement, as updated to
add the information with respect to the [New Subsidiary] Parent’s Equity
Interests (as defined in the Security Agreement) in the New Subsidiary set forth
on Attachment B hereto and any other relevant information, is a true, accurate
and complete representation of the information described and referenced in the
corresponding sections of the Security Agreement, after giving effect to this
Addendum.  The [New Subsidiary] Parent hereby confirms that the representations
and warranties set forth in Article IV of the Security Agreement with respect to
the New Subsidiary Parent Collateral (as defined below) are true and correct
with respect to the New Subsidiary Parent Collateral, after giving effect to
this Addendum.  Any phrase stating “as of the date hereof” or any similar phrase
in its representations and warranties set forth in Article IV of the Security
Agreement insofar as they relate to the New Subsidiary Parent Collateral is
intended to apply as of the date of this Addendum with respect to the New
Subsidiary Parent Collateral.

 

(b)           Each of the Parent and the New Subsidiary acknowledges and agrees
that Annexes 1 through 5, inclusive, of the Security Agreement, as updated to
add the information with respect to the New Subsidiary and the New Subsidiary
Collateral set forth on the corresponding Annexes of the New Subsidiary
Information List attached in Attachment A hereto and any other relevant
information, are true, accurate and complete representations of the information
described and referenced in the corresponding sections of the Security
Agreement, after giving effect to this Addendum.  The New Subsidiary hereby
confirms that the representations and warranties set forth in Article IV of the
Security Agreement applicable to the New Subsidiary and the New Subsidiary
Collateral are true and correct with respect to the New Subsidiary and the New
Subsidiary Collateral, after giving effect to this Addendum.  Any phrase stating
“as of the date hereof” or any similar phrase in its representations and
warranties set forth in the Security Agreement is intended to apply as of the
date of this Addendum with respect to the New Subsidiary and the New Subsidiary
Collateral.

 

Exhibit 1.1B(ii)-3

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

 

[(c)        Each of the Parent and the New Subsidiary acknowledges and agrees
that Schedule 1 of the Share Pledge Agreement, as updated by the information
contained in Schedule 1 of Attachment A hereto, is a true, accurate and complete
representation of the information described and referenced in the corresponding
sections of the Share Pledge Agreement, after giving effect to this Addendum. 
The New Subsidiary hereby confirms that the representations and warranties set
forth in [insert applicable provisions] of the Share Pledge Agreement are true
and correct with respect to the New Subsidiary and the New Subsidiary
Collateral, after giving effect to this Addendum.]

 

5.             Security Interest (New Subsidiary Parent)(9).  As collateral
security for the prompt payment in full when due (whether at stated maturity, by
acceleration or otherwise) and performance of the Secured Obligations (as
defined in the Security Agreement), the New Subsidiary Parent hereby grants to
the US Agent for the benefit of the Secured Parties (as defined in the Security
Agreement) a security interest in all of the New Subsidiary Parent’s right,
title and interest in, to and under the following property, whether now owned or
hereafter acquired by the New Subsidiary Parent and whether now existing or
hereafter coming into existence and wherever located (collectively, the “New
Subsidiary Parent Collateral”):  (a) all Securities Collateral (as defined in
the Security Agreement) described on Attachment B to this Addendum, and (b) all
Proceeds (as defined in the Security Agreement) of such Securities Collateral,
pursuant to and in accordance with the terms of the Security Agreement (and all
such New Subsidiary Parent Collateral shall be “Collateral” for purposes of the
Security Agreement).  [In addition, the New Subsidiary Parent hereby grants to
the Euro Agent, for the benefit of the Lenders, to the maximum extent allowed by
applicable law, a lien and security interest on all of the New Subsidiary Parent
Collateral pursuant to, and in accordance with, the terms of the Share Pledge
Agreement.]

 

6.             Security Interest (New Subsidiary).  As collateral security for
the prompt payment in full when due (whether at stated maturity, by acceleration
or otherwise) and performance of the Secured Obligations (as defined in the
Security Agreement), the New Subsidiary hereby grants to the US Agent for the
benefit of the Secured Parties (as defined in the Security Agreement) a security
interest in all of the New Subsidiary’s right, title and interest in, to and
under the following property, whether now owned or hereafter acquired by the New
Subsidiary and whether now existing or hereafter coming into existence and
wherever located (collectively, the “New Subsidiary Collateral”):  (a) all
Securities Collateral (as defined in the Security Agreement) described on
Attachment C to this Addendum, (b) all other Collateral (as defined in the
Security Agreement) described in the Security Agreement and (c) all Proceeds (as
defined in the Security Agreement) of such Securities Collateral, pursuant to
and in accordance with the terms of the Security Agreement (and all such New
Subsidiary Collateral shall be “Collateral” for purposes of the Security
Agreement).  [In addition, the New Subsidiary Parent hereby grants to the Euro
Agent, for the benefit of the Lenders, to the maximum extent allowed by
applicable law, a lien and security interest on all of the New Subsidiary Parent
Collateral pursuant to, and in accordance with, the terms of the Share Pledge
Agreement.]

 

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

(9)  Include only if New Parent Subsidiary is a party to this Addendum.

 

Exhibit 1.1B(ii)-4

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

 

7.             Authorization to Take Further Action.  [Each of the] [The] New
Subsidiary [and the New Subsidiary Parent] hereby authorizes the US Agent to
file such financing statements as may be necessary or desirable to perfect the
Liens under the Security Agreement and any modification, extension or
ratification thereof.

 

8.             Reliance.  All parties hereto acknowledge that the Agents and the
Lenders are relying on this Addendum, the accuracy of the statements herein
contained and the performance of the conditions placed upon the New Subsidiary
hereunder, and that, but for the execution of this Addendum by said parties, the
Agents and the Lenders would not allow the New Subsidiary to become party to the
Credit Agreement.  The New Subsidiary does hereby covenant and agree that it
will execute such further documents and undertake any such measure as may be
necessary to effect and carry out the terms of this Addendum and the
implementation thereof.

 

9.             Warranties.  The New Subsidiary (a) represents and warrants that
it is legally authorized to enter into this Addendum, and (b) confirms that it
is a Wholly Owned Subsidiary of the Parent and that it is either a Foreign
Subsidiary or a Domestic Subsidiary all or substantially all of the assets of
which consist of stock or securities in one or more Foreign Subsidiaries.

 

10.           Choice of Law.  This Addendum shall be governed by, and construed
in accordance with, the laws of the State of New York, without regard to
conflicts of law principles.

 

11.           Ratification; Conflicts.  Any and all conflicts or inconsistencies
between the terms and provisions of this Addendum and the Credit Agreement shall
be governed and controlled by the terms and provisions of this Addendum.  Except
as modified hereby, the Credit Agreement and the Security Agreement remain in
full force and effect according to their terms.

 

12.           Effectiveness.  Upon execution of this Addendum by the New
Subsidiary, this Addendum shall become immediately effective and enforceable as
to such New Subsidiary and all of the Original Parties.

 

[Signature Page Follows]

 

Exhibit 1.1B(ii)-5

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

 

IN WITNESS WHEREOF, the parties have executed this Addendum and agreed to the
provisions contained herein effective as of                                 ,
200        .

 

 

NEW SUBSIDIARY:

,

 

a

 

 

 

 

 

 

By:

 

 

 

 

 

Name:

 

 

Title:

 

 

 

 

 

[NEW SUBSIDIARY PARENT

,

 

a

 

 

 

 

 

 

By:

 

 

 

 

 

 

Name:

 

 

Title:

]

 

 

 

 

PARENT:

DYNAMIC MATERIALS CORPORATION,

 

a Delaware corporation

 

 

 

 

 

By:

 

 

 

 

 

Name:

 

 

Title:

 

 

Exhibit 1.1B(ii)-6

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

 

ATTACHMENT A

 

ADDITIONAL INFORMATION REGARDING THE NEW SUBSIDIARY

 

The following Schedules as described in the Credit Agreement:

 

Schedule 3.01                Organization

Schedule 3.03                No Violations

Schedule 3.05                No Undisclosed Liabilities

Schedule 3.06                Litigation

Schedule 3.07                Compliance with Law

Schedule 3.08                Material Contracts

Schedule 3.09                Properties

Schedule 3.10                Intellectual Property

Schedule 3.12                Environmental Compliance

Schedule 6.02                Existing Liens

Schedule 6.05                Permitted Investments

Schedule 6.08(j)            Permitted Affiliate Agreements

Schedule 6.09                Restrictive Agreements

[Schedule 9.10             Jurisdiction Specific Provisions] [If applicable]

 

The following Annexes as described in the Security Agreement:

 

Annex 1                         Securities Collateral

Annex 2                         Filing Offices

Annex 3                         Debtor Information

Annex 4                         Previous Names and Transactions

Annex 5                         Offices and Locations of Records

 

[3.                             The following schedule as described in the Share
Pledge Agreement:

 

Schedule I                     Pledged Shares]

 

Exhibit 1.1 B(ii)-7

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

 

Entity Documents

Provide a copy of all organizational documents, including, as applicable:

 

·              Evidence of Formation/Registration

·              Governing Documents/Bylaws

·              Authorizing Resolutions/Consents

·              Incumbency Certificates

 

Exhibit 1.1B(ii)-8

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

 

ATTACHMENT B

 

EQUITY INTERESTS OWNED BY THE [NEW SUBSIDIARY] PARENT IN NEW SUBSIDIARY

 

Exhibit 1.1B(ii)-9

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

 

ATTACHMENT C

 

EQUITY INTERESTS OWNED BY THE NEW SUBSIDIARY
IN ITS WHOLLY OWNED SUBSIDIARIES

 

Exhibit 1.1B(ii)-10

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

 

EXHIBIT 1.1C

MANDATORY COST

 

1.             The Mandatory Cost is an addition to the interest rate to
compensate Euro Lenders for the cost of compliance with (a) the requirements of
the Bank of England and/or the Financial Services Authority (or, in either case,
any other authority which replaces all or any of its functions) or (b) the
requirements of the European Central Bank.

 

2.             On the first day of each Interest Period (or as soon as possible
thereafter) the Euro Administrative Agent shall calculate, as a percentage rate,
a rate (the “Additional Cost Rate”) for each Euro Lender, in accordance with the
paragraphs set out below.  The Mandatory Cost will be calculated by the Euro
Administrative Agent as a weighted average of the Eurocurrency Lenders’
Additional Cost Rates (weighted in proportion to the percentage participation of
each Euro Lender in the relevant Euro Loan) and will be expressed as a
percentage rate per annum.

 

3.             The Additional Cost Rate for any Euro Lender lending from a
facility office in a Participating Member State will be the percentage notified
by that Euro Lender to the Euro Administrative Agent.  This percentage will be
certified by that Euro Lender in its notice to the Euro Administrative Agent to
be its reasonable determination of the cost (expressed as a percentage of that
Euro Lender’s participation in all Euro Loans made from that facility office) of
complying with the minimum reserve requirements of the European Central Bank in
respect of loans made from that facility office.

 

4.             The Additional Cost Rate for any Euro Lender lending from a
facility office in the United Kingdom will be calculated by the Euro
Administrative Agent as follows:

 

(a)             in relation to a sterling Loan:

 

[g310381ki35i001.gif]

per cent. per annum

 

(b)           in relation to a Loan in any currency other than sterling:

 

[g310381ki35i002.gif]

per cent. per annum.

 

Where:

 

A                             is the percentage of Eligible Liabilities
(assuming these to be in excess of any stated minimum) which that Euro Lender is
from time to time required to maintain as an interest free cash ratio deposit
with the Bank of England to comply with cash ratio requirements.

 

B                             is the percentage rate of interest (excluding the
Applicable Margin and the Mandatory Cost) and, if the Euro Loan is an unpaid
sum, the Default Rate payable for the relevant Interest Period on the Euro Loan.

 

Exhibit 1.1C-1

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

 

C                             is the percentage (if any) of Eligible Liabilities
which that Euro Lender is required from time to time to maintain as interest
bearing Special Deposits with the Bank of England.

 

D                             is the percentage rate per annum payable by the
Bank of England to the Euro Administrative Agent on interest bearing Special
Deposits.

 

E                              is designed to compensate Euro Lenders for
amounts payable under the Fees Rules and is calculated by the Euro
Administrative Agent as being the average of the most recent rates of charge
supplied by the Reference Banks to the Euro Administrative Agent pursuant to
paragraph 7 below and expressed in pounds per £1,000,000.

 

5.                               For the purposes of this Exhibit:

 

(a)                                 “Eligible Liabilities” and “Special
Deposits” have the meanings given to them from time to time under or pursuant to
the Bank of England Act 1998 or (as may be appropriate) by the Bank of England;

 

(b)                                 “Fees Rules” means the rules on periodic
fees contained in the FSA Supervision Manual or such other law or regulation as
may be in force from time to time in respect of the payment of fees for the
acceptance of deposits;

 

(c)                                  “Fee Tariffs” means the fee tariffs
specified in the Fees Rules under the activity group A.1 Deposit acceptors
(ignoring any minimum fee or zero rated fee required pursuant to the Fees
Rules but taking into account any applicable discount rate);

 

(d)                                 “Reference Bank” means the Euro
Administrative Agent and any other bank or financial institution appointed as
such by the Euro Administrative Agent under this Agreement in consultation with
the Euro Borrowers; and

 

(e)                                  “Tariff Base” has the meaning given to it
in, and will be calculated in accordance with, the Fees Rules.

 

6.                               In application of the above formulae, A, B, C
and D will be included in the formulae as percentages (i.e. 5 per cent. will be
included in the formula as 5 and not as 0.05).  A negative result obtained by
subtracting D from B shall be taken as zero.  The resulting figures shall be
rounded to four decimal places.

 

7.                               If requested by the Euro Administrative Agent,
each Reference Bank shall, as soon as practicable after publication by the
Financial Services Authority, supply to the Euro Administrative Agent, the rate
of charge payable by that Reference Bank to the Financial Services Authority
pursuant to the Fees Rules in respect of the relevant financial year of the
Financial Services Authority (calculated for this purpose by that Reference Bank
as being the average of the Fee Tariffs applicable to that Reference Bank for
that financial year) and expressed in pounds per £1,000,000 of the Tariff Base
of that Reference Bank.

 

Exhibit 1.1C-2

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

 

8.                               Each Euro Lender shall supply any information
required by the Euro Administrative Agent for the purpose of calculating its
Additional Cost Rate.  In particular, but without limitation, each Euro Lender
shall supply the following information on or prior to the date on which it
becomes a Euro Lender:

 

(a)             the jurisdiction of its facility office; and

 

(b)             any other information that the Euro Administrative Agent may
reasonably require for such purpose.

 

Each Euro Lender shall promptly notify the Euro Administrative Agent of any
change to the information provided by it pursuant to this paragraph.

 

9.                               The percentages of each Euro Lender for the
purpose of A and C above and the rates of charge of each Reference Bank for the
purpose of E above shall be determined by the Euro Administrative Agent based
upon the information supplied to it pursuant to paragraphs 7 and 8 above and on
the assumption that, unless a Euro Lender notifies the Euro Administrative Agent
to the contrary, each Euro Lender’s obligations in relation to cash ratio
deposits and Special Deposits are the same as those of a typical bank from its
jurisdiction of incorporation with a facility office in the same jurisdiction as
its facility office.

 

10.                        The Euro Administrative Agent shall have no liability
to any Person if such determination results in an Additional Cost Rate which
over or under compensates any Euro Lender and shall be entitled to assume that
the information provided by any Euro Lender or Reference Bank pursuant to
paragraphs 3, 7 and 8 above is true and correct in all respects.

 

11.                        The Euro Administrative Agent shall distribute the
additional amounts received as a result of the Mandatory Cost to the
Eurocurrency Lenders on the basis of the Additional Cost Rate for each Euro
Lender based on the information provided by each Euro Lender and each Reference
Bank pursuant to paragraphs 3, 7 and 8 above.

 

12.                        Any determination by the Euro Administrative Agent
pursuant to this Exhibit in relation to a formula, the Mandatory Cost, an
Additional Cost Rate or any amount payable to a Euro Lender shall, in the
absence of manifest error, be conclusive and binding on all parties to this
Agreement.

 

13.                        The Euro Administrative Agent may from time to time,
after consultation with the Euro Borrowers and the Euro Lenders, determine and
notify to all parties hereto any amendments which are required to be made to
this Exhibit in order to comply with any change in law, regulation or any
requirements from time to time imposed by the Bank of England, the Financial
Services Authority or the European Central Bank (or, in any case, any other
authority which replaces all or any of its functions) and any such determination
shall, in the absence of manifest error, be conclusive and binding on all
parties hereto.

 

Exhibit 1.1C-3

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

 

EXHIBIT 1.1D

FORM OF

COMMITMENT INCREASE AGREEMENT

 

This Commitment Increase Agreement dated as of                         ,
20     (this “Agreement”) is among (i) Dynamic Materials Corporation (the
“Parent”), (ii) JPMorgan Chase Bank, N.A., in its capacity as US administrative
agent (the “US Administrative Agent”) under the Amended and Restated Credit
Agreement dated as of December 21, 2011 (as the same may be amended, restated,
amended and restated, extended, supplemented or otherwise modified from time to
time, the “Credit Agreement”; capitalized terms that are defined in the Credit
Agreement and not defined herein are used herein as therein defined) among the
Parent, the US Borrowers party thereto, the Euro Borrowers party thereto, the
Canadian Borrowers party thereto, the Guarantors party thereto, the Lenders
party thereto, the US Administrative Agent, J.P. Morgan Europe Limited, as Euro
Administrative Agent, JPMorgan Chase Bank, N.A., Toronto Branch, as Canadian
Administrative Agent, KeyBank National Association, as Syndication Agent and
Wells Fargo Bank, N.A., as Documentation Agent, (iii) the [US/Foreign]
Guarantors party hereto (the “Guarantors”) and (iv)                         
(the “Increasing Lender”).

 

PRELIMINARY STATEMENTS

 

A.            Pursuant to Section 2.19 of the Credit Agreement, the Parent has
the right, subject to the terms and conditions thereof, to effectuate from time
to time an increase in the total Commitments under the Credit Agreement by
agreeing with a Lender to increase that Lender’s Commitment.

 

B.            The Parent has given notice to the US Administrative Agent of its
intention to increase the total Commitments pursuant to such Section 2.19 by
increasing the [US/Euro/Canadian] Commitment of the Increasing Lender from
                to                (1), and the US Administrative Agent is
willing to consent thereto.

 

Accordingly, the parties hereto agree as follows:

 

SECTION 1.         Increase of Commitment.  Pursuant to Section 2.19 of the
Credit Agreement, the [US/Euro/Canadian] Commitment of the Increasing Lender is
hereby increased from               to              .

 

SECTION 2.         Increasing Lender Credit Decision.  The Increasing Lender
acknowledges that it has, independently and without reliance upon any Agent or
any Lender and based on the financial statements referred to in Section 3.04 of
the Credit Agreement and such other documents and information as it has deemed
appropriate, made its own credit analysis and decision to enter into this
Agreement and to agree to the various matters set forth herein.  The Increasing
Lender also acknowledges that it will, independently and without reliance upon
any Agent or any Lender and based on such documents and information as it shall
deem appropriate

 

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

(1)  Amount of increase must be at least $5,000,000, €3,000,000 or C$1,000,000,
as applicable.

 

Exhibit 1.1D-1

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

 

at the time, continue to make its own credit decisions in taking or not taking
action under the Credit Agreement.

 

SECTION 3.         Acknowledgement.  The US Administrative Agent hereby
acknowledges the increase in the [US/Euro/Canadian] Commitment of the Increasing
Lender effectuated hereby.

 

SECTION 4.         Representations and Warranties of the Parent.  The Parent
represents and warrants as follows:

 

(a)           The execution, delivery and performance by the Parent of this
Agreement are within the Parent’s corporate powers, have been duly authorized by
all necessary corporate action and do not contravene (i) the Parent’s
certificate of incorporation or bylaws or (ii) any agreement to which the Parent
is a party where such contravention could reasonably be expected to result in a
Material Adverse Effect.

 

(b)           No consent, waiver, approval, exemption, authorization or other
action of any Person is required for the valid execution, delivery and
performance by the Parent of this Agreement except such (i) as have been
obtained or made and are in full force and effect, and (ii) those required in
the ordinary course of business of the Parent in order to comply with
requirements of applicable Law.

(c)           This Agreement constitutes a legal, valid and binding agreement of
the Parent enforceable against the Parent in accordance with its terms, subject
to the effect of applicable bankruptcy, insolvency, reorganization, moratorium
or other laws affecting creditors’ rights and remedies generally and to the
effect of general principles of equity (regardless of whether considered in a
proceeding at law or in equity).

 

(d)           At the time of delivery of the Commitment Increase Notice, no
Default, Event of Default or Material Adverse Change had occurred and was
continuing.

 

SECTION 5.         Representations and Warranties of the Guarantors.  Each
Guarantor represents and warrants as follows:

(a)           The execution, delivery and performance by it of this Agreement
are within the Parent’s corporate powers, have been duly authorized by all
necessary corporate action and do not contravene (i) its articles or certificate
of incorporation, bylaws, partnership agreement, limited liability company
agreement or other organization documents, as applicable, or (ii) any agreement
to which it is a party where such contravention could reasonably be expected to
result in a Material Adverse Effect.

 

(b)           No consent, waiver, approval, exemption, authorization or other
action of any Person is required for the valid execution, delivery and
performance by it of this Agreement except such (i) as have been obtained or
made and are in full force and effect, and (ii) those required in the ordinary
course of its business in order to comply with requirements of applicable Law.

 

Exhibit 1.1D-2

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

 

(c)           This Agreement constitutes a legal, valid and binding agreement of
it enforceable against it in accordance with its terms, subject to the effect of
applicable bankruptcy, insolvency, reorganization, moratorium or other laws
affecting creditors’ rights and remedies generally and to the effect of general
principles of equity (regardless of whether considered in a proceeding at law or
in equity).

 

SECTION 6          Effectiveness.  This Agreement shall become effective as of
the date first above written upon the receipt by the US Administrative Agent of
the following:

 

(a)           counterparts of this Agreement executed by the Parent, the
Guarantors, the US Administrative Agent and the Increasing Lender; and

 

(b)           a certified copy of the corporate resolutions of the Parent and
the [US/Euro/Canadian] Borrower[s] approving the increase in the
[US/Euro/Canadian] Commitment and the execution, delivery and performance of
this Agreement in a form reasonably acceptable to the US Administrative Agent.

 

SECTION 7.         Governing Law.  This Agreement shall be governed by, and
construed in accordance with, the Laws of the State of New York.

 

SECTION 8.         Execution in Counterparts.  This Agreement may be executed in
any number of counterparts and by different parties hereto in separate
counterparts and may be delivered in original, facsimile or pdf form, each of
which when so executed and delivered shall be deemed to be an original and all
of which taken together shall constitute one and the same agreement.

 

SECTION 9.         Expenses.  The Parent agrees to pay all reasonable
out-of-pocket expenses incurred by the S Administrative Agent in connection with
this Agreement as required by Section 10.03 of the Credit Agreement.

 

[Signatures on following page]

 

Exhibit 1.1D-3

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

 

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
by their respective officers thereunder duly authorized, as of the date first
above written.

 

 

PARENT:

 

 

 

DYNAMIC MATERIALS CORPORATION,

 

a Delaware corporation

 

 

 

 

 

By:

 

 

Name:

 

 

Title:

 

 

 

 

 

 

GUARANTORS:

 

 

 

[INSERT US/FOREIGN GUARANTORS, AS APPLICABLE]

 

 

 

 

 

US ADMINISTRATIVE AGENT:

 

 

 

JPMORGAN CHASE BANK, N.A.

 

as US Administrative Agent

 

 

 

 

 

By:

 

 

Name:

 

 

Title:

 

 

 

 

INCREASING LENDER:

 

 

 

[NAME OF INCREASING LENDER]

 

 

 

 

 

By:

 

 

Name:

 

 

Title:

 

 

Exhibit 1.1D-4

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

 

EXHIBIT 1.1E

FORM OF
NEW LENDER AGREEMENT

 

This New Lender Agreement dated as of [                         ] (this
“Agreement”) is among (i) Dynamic Materials Corporation (the “Parent”),
(ii) JPMorgan Chase Bank, N.A., in its capacity as US administrative agent (the
“US Administrative Agent”) under the Amended and Restated Credit Agreement dated
as of December 21, 2011 (as the same may be amended, restated, amended and
restated, extended, supplemented or otherwise modified from time to time, the
“Credit Agreement”; capitalized terms that are defined in the Credit Agreement
and not defined herein are used herein as therein defined) among the Parent, the
US Borrowers party thereto, the Euro Borrowers party thereto, the Canadian
Borrowers party thereto, the Guarantors party thereto, the Lenders party
thereto, the US Administrative Agent, J.P. Morgan Europe Limited, as Euro
Administrative Agent, JPMorgan Chase Bank, N.A., Toronto Branch, as Canadian
Administrative Agent, KeyBank National Association, as Syndication Agent and
Wells Fargo Bank, N.A., as Documentation Agent, (iii) the Guarantors party
hereto (the “Guarantors”), and (iv)                           (“New Lender”).

PRELIMINARY STATEMENTS

 

A.            Pursuant to Section 2.19 of the Credit Agreement, the Parent has
the right, subject to the terms and conditions thereof, to effectuate from time
to time an increase in the total Commitments under the Credit Agreement by
offering to the Lenders and other banks and financial institutions the
opportunity to participate in all or a portion of the increased Commitments.

 

B.            The Parent has given notice to the US Administrative Agent of its
intention to increase the total Commitments pursuant to such Section 2.19 by
increasing the US, Euro and Canadian Commitments by $[               ],
€[               ] and C$[               ](1) and the existing Lenders have
failed to subscribe to all of such increased Commitment.

 

C.            The New Lender desires to become a Lender under the Credit
Agreement and extend Loans to the Borrowers in accordance with the terms thereof
and the US Administrative Agent, each Issuing Lender and each Swingline Lender
are willing to consent thereto.

 

Accordingly, the parties hereto agree as follows:

 

SECTION 1.           Loan Documents.  The New Lender hereby acknowledges receipt
of copies of the Credit Agreement and the other Loan Documents.

 

SECTION 2.           Joinder to Credit Agreement. By executing and delivering
this Agreement, the New Lender hereby agrees (i) to become a party to the Credit
Agreement as a Lender as defined therein and (ii) to be bound by all the terms,
conditions, representations, and

 

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

(1)  Amount of increase must be at least $5,000,000, €3,000,000 or C$1,000,000,
as applicable.

 

Exhibit 1.1E-1

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

 

warranties of the Credit Agreement and the other Loan Documents applicable to
Lenders, and all references to the Lenders in the Loan Documents shall be deemed
to include the New Lender.  Without limiting the generality of the foregoing,
the New Lender hereby agrees to make US, Euro and Canadian Loans to the US, Euro
and Canadian Borrowers and to acquire participations in US, Euro and Canadian
Letters of Credit and US and Euro Swingline Loans from time to time during the
Availability Period in an aggregate principal amount that will not result in the
New Lender’s US Credit Exposure exceeding its US Commitment, its Euro Credit
Exposure exceeding its Euro Commitment or its Canadian Credit Exposure exceeding
its Canadian Commitment.  The US Commitment of the New Lender shall be
$[               ](2), the Euro Commitment of the New Lender shall be
€[               ](3) and the Canadian Commitment of the New Lender shall be
C$[               ](4).

 

SECTION 3.           New Lender Credit Decision.  The New Lender acknowledges
that it has, independently and without reliance upon any Agent or any Lender and
based on the financial statements referred to in Section 3.04 of the Credit
Agreement and such other documents and information as it has deemed appropriate,
made its own credit analysis and decision to enter into this Agreement and to
agree to the various matters set forth herein.  The New Lender also acknowledges
that it will, independently and without reliance upon any Agent or any Lender
and based on such documents and information as it shall deem appropriate at the
time, continue to make its own credit decisions in taking or not taking action
under the Credit Agreement.

 

SECTION 4.           Consent.  Each of the US Administrative Agent, each Issuing
Lender and each Swingline Lender hereby consents to the participation of the New
Lender in the increased Commitments.

 

SECTION 5.           Representation and Warranties of the Parent.  The Parent
represents and warrants as follows:

 

(a)           The execution, delivery and performance by the Parent of this
Agreement are within the Parent’s corporate powers, have been duly authorized by
all necessary corporate action and do not contravene (i) the Parent’s
certificate of incorporation or bylaws or (ii) any agreement to which the Parent
is a party where such contravention could reasonably be expected to result in a
Material Adverse Effect.

 

(b)           No consent, waiver, approval, exemption, authorization or other
action of any Person is required for the valid execution, delivery and
performance by the Parent of this Agreement except such (i) as have been
obtained or made and are in full force and effect, and (ii) those required in
the ordinary course of business of the Parent in order to comply with
requirements of applicable Law.

 

(c)           This Agreement constitutes a legal, valid and binding agreement of
the Parent enforceable against the Parent in accordance with its terms, subject
to the effect of applicable bankruptcy, insolvency, reorganization, moratorium
or other laws affecting creditors’

 

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

(2)  Must be at least $5,000,000.

(3)  Must be at least €3,000,000.

(4)  Must be at least C$1,000,000.

 

Exhibit 1.1E-2

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

 

rights and remedies generally and to the effect of general principles of equity
(regardless of whether considered in a proceeding at law or in equity).

 

(d)           At the time of delivery of the Commitment Increase Notice, no
Default, Event of Default or Material Adverse Change had occurred and was
continuing.

 

SECTION 6.           Representations and Warranties of the Guarantors.  Each
Guarantor represents and warrants as follows:

(a)           The execution, delivery and performance by it of this Agreement
are within the Parent’s corporate powers, have been duly authorized by all
necessary corporate action and do not contravene (i) its articles or certificate
of incorporation, bylaws, partnership agreement, limited liability company
agreement or other organization documents, as applicable, or (ii) any agreement
to which it is a party where such contravention could reasonably be expected to
result in a Material Adverse Effect.

 

(b)           No consent, waiver, approval, exemption, authorization or other
action of any Person is required for the valid execution, delivery and
performance by it of this Agreement except such (i) as have been obtained or
made and are in full force and effect, and (ii) those required in the ordinary
course of its business in order to comply with requirements of applicable Law.

 

(c)           This Agreement constitutes a legal, valid and binding agreement of
it enforceable against it in accordance with its terms, subject to the effect of
applicable bankruptcy, insolvency, reorganization, moratorium or other laws
affecting creditors’ rights and remedies generally and to the effect of general
principles of equity (regardless of whether considered in a proceeding at law or
in equity).

 

SECTION 7.           Effectiveness.  This Agreement shall become effective as of
the date first above written upon the receipt by the US Administrative Agent of
the following:

 

(a)           Counterparts of this Agreement executed by the Parent, the
Guarantors, the US Administrative Agent, each Issuing Lender, each Swingline
Lender and the New Lender;

 

(b)           an Administrative Questionnaire, duly completed by the New Lender;

 

(c)           any documentation required to be delivered by the New Lender
pursuant to Section 2.16 of the Credit Agreement, duly completed and executed by
the New Lender; and

 

(d)           a certified copy of the corporation resolutions of the Parent and
the Borrowers approving the increase in the Commitments and the execution,
delivery and performance of this Agreement in a form reasonably acceptable to
the US Administrative Agent.

 

SECTION 8.           Governing Law.  This Agreement shall be construed in
accordance with and governed by the laws of the State of New York.

 

SECTION 9.           Execution in Counterparts.  This Agreement may be executed
in any number of counterparts and by different parties hereto in separate
counterparts and may be

 

Exhibit 1.1E-3

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

 

delivered in original, facsimile or pdf form, each of which when so executed and
delivered shall be deemed to be an original and all of which taken together
shall constitute one and the same agreement.

 

SECTION 9.           Expenses.  The Parent agrees to pay all reasonable
out-of-pocket expenses incurred by the US Administrative Agent in connection
with this Agreement as required by Section 10.03 of the Credit Agreement.

 

[Signatures on following page]

 

Exhibit 1.1E-4

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

 

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
by their respective officers thereunder duly authorized, as of the date first
above written.

 

 

PARENT:

 

 

 

DYNAMIC MATERIALS CORPORATION,

 

a Delaware corporation

 

 

 

 

 

By:

 

 

Name:

 

 

Title:

 

 

 

 

 

 

 

 

GUARANTORS:

 

 

 

 

[INSERT NAMES OF ALL GUARANTORS]

 

 

 

 

 

 

 

JPMORGAN CHASE BANK, N.A.

 

as US Administrative Agent, US Issuing Lender and US Swingline Lender

 

 

 

 

 

 

 

By:

 

 

Name:

 

 

Title:

 

 

 

 

 

 

 

 

J.P. MORGAN EUROPE LIMITED,

 

as Euro Issuing Lender and Euro Swingline Lender

 

 

 

 

 

 

 

By:

 

 

Name:

 

 

Title:

 

 

 

 

 

 

 

 

JPMORGAN CHASE BANK, N.A., TORONTO BRANCH,

 

as Canadian Issuing Lender

 

 

 

 

 

 

 

By:

 

 

Name:

 

 

Title:

 

 

Exhibit 1.1E-5

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

 

 

NEW LENDER:

 

 

 

 

[NAME OF NEW LENDER]

 

 

 

 

 

 

 

By:

 

 

Name:

 

 

Title:

 

 

Exhibit 1.1E-6

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

 

EXHIBIT 2.03

 

FORM OF
REQUEST FOR BORROWING

 

[US Administrative Agent in the case of a Eurodollar or ABR Borrowing]

 

JPMorgan Chase Bank, N.A.

Loan and Agency Services Group

10 South Dearborn, 7th Floor

Chicago, Illinois  60603

Attention:              Robin Bailey

Alternative:           Jeremy Stank

Facsimile:               (312) 385-7102

 

[Euro Administrative Agent in the case of a Eurocurrency Borrowing]

 

J.P. Morgan Europe Limited

125 London Wall

London

England EC2Y 5AJ

Attention:              Agency

Facsimile:               44 207 777 2360

 

[Canadian Administrative Agent in the case of a CDOR or Canadian Prime
Borrowing]

 

JPMorgan Chase Bank, N.A., Toronto Branch

[                                      ]

[                                      ]

[                                      ]

Attention:              [                        ]

Facsimile:               [                        ]

 

Re:                               Amended and Restated Credit Agreement dated as
of December 21, 2011 (the “Credit Agreement”), by and among Dynamic Materials
Corporation, the US Borrowers party thereto, the Euro Borrowers party thereto,
the Canadian Borrowers party thereto, the Guarantors party thereto, the Lenders
party thereto, JPMorgan Chase Bank, N.A., as US Administrative Agent, J.P.
Morgan Europe Limited, as Euro Administrative Agent, JPMorgan Chase Bank, N.A.,
Toronto Branch, as Canadian Administrative Agent, KeyBank National Association,
as Syndication Agent and Wells Fargo Bank, N.A, as Documentation Agent

 

Ladies and Gentlemen:

 

Pursuant to the Credit Agreement, the undersigned Borrower hereby makes the
requests indicated below:

 

Exhibit 2.03-1

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

 

(a)

 

Amount of Borrowing:                     

 

 

 

(b)

 

Requested funding date:                                      

 

 

 

(c)

 

Class of Borrowing:

 

 

 

 

 

                    US Borrowing

 

 

 

 

 

                    Euro Borrowing

 

 

 

 

 

                    Canadian Borrowing

 

 

 

(d)

 

Type of Borrowing:

 

 

 

 

 

                    ABR Borrowing

 

 

 

 

 

                    Eurodollar Borrowing

 

 

 

 

 

                    Eurocurrency Borrowing

 

 

 

 

 

                    Canadian Prime Borrowing

 

 

 

 

 

                    CDOR Borrowing

 

 

 

(e)

 

Requested Interest Period for Eurodollar Borrowing, Eurocurrency Borrowing or
CDOR Borrowing:

 

 

 

 

 

                                     

(f)

 

Location and number of account to which funds are to be disbursed:

 

 

 

 

 

                                     

 

 

 

 

 

                                     

 

Each of the undersigned certifies that [s]he is an authorized officer of the
undersigned Borrower and as such [s]he is authorized to execute this request on
behalf of the undersigned Borrower.  The undersigned Borrower represents and
warrants that (i) the undersigned Borrower is entitled to receive the requested
Borrowing under the terms and conditions of the Credit Agreement and that no
Default or Event of Default has occurred and is continuing or will occur as a
result of the making of requested Borrowing; (ii) no Material Adverse Effect has
occurred since the date of the most recent Borrowing and (iii) the
representations and warranties of each Obligor set forth in the Credit Agreement
and the other Loan Documents are true and correct in all material respects as of
the date of the Borrowing requested hereby; provided that to the extent any such
representation or warranty was made as of a specific date, such representation
and warranty shall be true and correct in all material respects as of such
specific date.

 

Exhibit 2.03-2

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

 

Each capitalized term used but not defined herein shall have the meaning
assigned to such term in the Credit Agreement.

 

 

Very truly yours,

 

 

 

[NAME OF BORROWER]

 

 

 

 

 

 

 

By:

 

 

Name:

 

 

Title:

 

 

 

 

 

 

 

 

By:

 

 

Name:

 

 

Title:

 

 

Exhibit 2.03-3

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

 

EXHIBIT 2.07

 

FORM OF

INTEREST ELECTION REQUEST

 

[US Administrative Agent in the case of a Eurodollar or ABR Borrowing]

 

JPMorgan Chase Bank, N.A.

Loan and Agency Services Group

10 South Dearborn, 7th Floor

Chicago, Illinois 60603

Attention:              Robin Bailey

Alternative:           Jeremy Stank

Facsimile:               (312) 385-7102

 

[Euro Administrative Agent in the case of a Eurocurrency Borrowing]

 

J.P. Morgan Europe Limited

125 London Wall

London

England EC2Y 5AJ

Attention:              Agency

Facsimile:               44 207 777 2360

 

[Canadian Administrative Agent in the case of a CDOR or Canadian Prime
Borrowing]

 

JPMorgan Chase Bank, N.A., Toronto Branch

[                                      ]

[                                      ]

[                                      ]

Attention:              [                       ]

 

Re:                               Amended and Restated Credit Agreement dated as
of December 21, 2011 (the “Credit Agreement”), by and among Dynamic Materials
Corporation, the US Borrowers party thereto, the Euro Borrowers party thereto,
the Canadian Borrowers party thereto, the Guarantors party thereto, the Lenders
party thereto, JPMorgan Chase Bank, N.A., as US Administrative Agent, J.P.
Morgan Europe Limited, as Euro Administrative Agent, JPMorgan Chase Bank, N.A.,
Toronto Branch, as Canadian Administrative Agent, KeyBank National Association,
as Syndication Agent and Wells Fargo Bank, N.A, as Documentation Agent

 

Ladies and Gentleman:

 

Pursuant to the Credit Agreement, the undersigned Borrower hereby makes the
requests indicated below:

 

(a)           The Borrowing to which this Interest Election Request applies is
as follows:

 

Exhibit 2.07-1

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(i)            Date of Borrowing:                                      .

 

(ii)           Class of Borrowing:                                      .

 

(iii)          Type of Borrowing:                                      .

 

(iv)          Interest Period:                                      .

 

(v)           Aggregate amount to be [converted] [continued]:
                                     .

 

(b)                                 The effective date of the election made
pursuant to this Interest Election Request is
                                     .

 

(c)                                  The Borrowing resulting from this Interest
Election Request shall be a                                       Borrowing.

 

(d)                                 The Interest Period applicable to the
resulting Borrowing is                                      .

 

Each of the undersigned certifies that [s]he is an authorized officer of the
undersigned Borrower and as such [s]he is authorized to execute this request on
behalf of the undersigned Borrower.  The undersigned Borrower represents and
warrants that (i) the undersigned Borrower is entitled to receive the requested
Borrowing under the terms and conditions of the Credit Agreement and that no
Default or Event of Default has occurred and is continuing or will occur as a
result of the making of requested Borrowing; (ii) no Material Adverse Effect has
occurred since the date of the most recent Borrowing and (iii) the
representations and warranties of each Obligor set forth in the Credit Agreement
and the other Loan Documents are true and correct in all material respects as of
the date of the Borrowing requested hereby; provided that to the extent any such
representation or warranty was made as of a specific date, such representation
and warranty shall be true and correct in all material respects as of such
specific date.

 

Each capitalized term used but not defined herein shall have the meaning
assigned to such term in the Credit Agreement.

 

 

Very truly yours,

 

 

 

 

[NAME OF BORROWER]

 

 

 

 

By:

 

 

Name:

 

 

Title:

 

 

 

 

 

 

 

 

By:

 

 

Name:

 

 

Title:

 

 

Exhibit 2.07-2

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

 

EXHIBIT 5.01(c)

 

FORM OF
COMPLIANCE CERTIFICATE

 

The undersigned hereby certifies that [s]he is a Financial Officer of Dynamic
Materials Corporation, a Delaware corporation (the “Parent”) and that as such
[s]he is authorized to execute this certificate on behalf of the Parent.  With
reference to the Amended and Restated Credit Agreement dated as of December 21,
2011 (the “Credit Agreement”), by and among the Parent, the US Borrowers party
thereto, the Euro Borrowers party thereto, the Canadian Borrowers party thereto,
the Guarantors party thereto, the Lenders party thereto, JPMorgan Chase Bank,
N.A., as US Administrative Agent, J.P. Morgan Europe Limited, as Euro
Administrative Agent, JPMorgan Chase Bank, N.A., Toronto Branch, as Canadian
Administrative Agent, KeyBank National Association, as Syndication Agent and
Wells Fargo Bank, N.A, as Documentation Agent, the undersigned represents and
warrants as follows (each capitalized term used herein having the same meaning
given to it in the Credit Agreement unless otherwise specified):

 

(a)                                  The representations and warranties of the
Obligors contained in the Credit Agreement and in the other Loan Documents were
true and correct in all material respects when made, and are repeated at and as
of the time of delivery hereof and to the best of the undersigned’s knowledge
are true and correct in all material respects at and as of the time of delivery
hereof, except for such representations and warranties as are by their express
terms limited to a specific date.

 

(b)                                 No Default has occurred or is continuing, or
if a Default has occurred, the details thereof and any action taken or proposed
to be taken with respect thereto are specified on Exhibit A attached hereto.

 

(c)                                  There have been no changes in GAAP or the
application thereof since the date of the last audited financial statements
delivered pursuant to Section 5.01(a) of the Credit Agreement, or if any change
has occurred, the effect such change would have on the financial statements
accompanying this certificate is set forth on Exhibit A attached hereto.

 

(d)                                 Calculations for all financial covenants are
set forth in the worksheet attached hereto as Exhibit B.

 

EXECUTED AND DELIVERED this              day of
                                  .

 

 

DYNAMIC MATERIALS CORPORATION

 

 

 

By:

 

 

Name:

 

 

Title:

 

 

Exhibit 5.01(c)-1

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

 

EXHIBIT A

 

DEFAULTS; CHANGES IN GAAP

 

Exhibit 5.01(c)-2

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

 

EXHIBIT B

 

FINANCIAL COVENANT CALCULATION WORKSHEET

($ in 000’s)

 

 

 

Calculation

 

Covenant
Requirement

Fixed Charge Coverage Ratio

 

x

 

2.0 to 1.0

Leverage Ratio

 

x

 

See Note 1

 

 

 

 

 

Fixed Charge Coverage Ratio: for the trailing four quarter period measured as of
the last day of the fiscal quarter ended                          ,
20               

 

 

 

 

(i) Consolidated EBITDA for such trailing four quarter period

 

 

 

 

to

 

 

 

 

(ii) Fixed Charges for such trailing four quarter period

 

 

 

 

 

 

 

 

 

Leverage Ratio: for the trailing four quarter period measured as of the last day
of the fiscal quarter ended                           , 20              

 

 

 

 

(i) Consolidated Funded Indebtedness of the Parent on the last day of the
trailing four quarter period

 

 

 

 

to

 

 

 

 

(ii) Consolidated Pro Forma EBITDA of the Parent for such trailing four quarter
period

 

 

 

 

 

Note:

1.                                       Required Leverage Ratio: (i) <2.25 to
1.0 for the period from the Effective Date through December 31, 2013, and
(ii) <2.0 to 1.0 thereafter.

 

Exhibit 5.01(c)-3

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