Exhibit 10.79

 

 

 

CREDIT AGREEMENT

Dated as of September 19, 2006

among

GUESS ?, INC.,

as the Domestic Borrower,

GUESS? CANADA CORPORATION,

as the Canadian Borrower,

BANK OF AMERICA, N.A.,

as Domestic Administrative Agent and Domestic L/C Issuer,

BANK OF AMERICA, N.A.,

acting through its Canada Branch,

as Canadian Administrative Agent and Canadian L/C Issuer,

and

The Other Lenders Party Hereto

 

 

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

TABLE OF CONTENTS

 

 

 

 

Page

 

 

 

 

 

ARTICLE I

DEFINITIONS AND ACCOUNTING TERMS

 

1

1.01

 

Defined Terms

 

1

1.02

 

Other Interpretive Provisions

 

27

1.03

 

Accounting Terms

 

28

1.04

 

Rounding

 

28

1.05

 

Times of Day

 

28

1.06

 

Letter of Credit Amounts

 

29

1.07

 

Currency Equivalents Generally

 

29

ARTICLE II

THE COMMITMENTS AND CREDIT EXTENSIONS

 

29

2.01

 

Committed Loans

 

29

2.02

 

Committed Borrowings, Conversions and Continuations of Committed Loans

 

30

2.03

 

Letters of Credit

 

32

2.04

 

Prepayments

 

41

2.05

 

Reduction or Termination of Commitments

 

42

2.06

 

Repayment of Loans

 

42

2.07

 

Interest

 

42

2.08

 

Fees

 

43

2.09

 

Computation of Interest and Fees

 

43

2.10

 

Evidence of Debt

 

44

2.11

 

Payments Generally; Administrative Agent’s Clawback

 

44

2.12

 

Sharing of Payments by Lenders

 

46

2.13

 

Reallocation of Aggregate Commitments

 

49

2.14

 

Suballocation of Letter of Credit Sublimits

 

50

ARTICLE III

TAXES, YIELD PROTECTION AND ILLEGALITY

 

50

3.01

 

Taxes

 

50

3.02

 

Illegality

 

52

3.03

 

Inability to Determine Rates

 

53

3.04

 

Increased Costs; Reserves on Eurodollar Rate Loans

 

53

3.05

 

Compensation for Losses

 

55

3.06

 

Mitigation Obligations; Replacement of Lenders

 

55

 

i

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

 

 

 

 

Page

 

 

 

 

 

3.07

 

Survival

 

56

ARTICLE IV

CONDITIONS PRECEDENT TO CREDIT EXTENSIONS

 

56

4.01

 

Conditions of Initial Credit Extension

 

56

4.02

 

Conditions to all Credit Extensions

 

58

ARTICLE V

REPRESENTATIONS AND WARRANTIES

 

59

5.01

 

Existence, Qualification and Power

 

59

5.02

 

Authorization; No Contravention

 

59

5.03

 

Governmental Authorization; Other Consents

 

59

5.04

 

Binding Effect

 

60

5.05

 

Financial Statements; No Material Adverse Effect; No Internal Control Event

 

60

5.06

 

Litigation

 

61

5.07

 

No Default

 

61

5.08

 

Ownership of Real Property; Liens

 

61

5.09

 

Environmental Compliance

 

61

5.10

 

Insurance

 

61

5.11

 

Taxes

 

62

5.12

 

ERISA Compliance

 

62

5.13

 

Subsidiaries; Equity Interests; Loan Parties

 

62

5.14

 

Margin Regulations; Investment Company Act; Public Utility Holding Company Act

 

63

5.15

 

Disclosure

 

63

5.16

 

Compliance with Laws

 

63

5.17

 

Intellectual Property; Licenses, Etc

 

63

ARTICLE VI

AFFIRMATIVE COVENANTS

 

64

6.01

 

Financial Statements

 

64

6.02

 

Certificates; Other Information

 

65

6.03

 

Notices

 

67

6.04

 

Payment of Obligations

 

67

6.05

 

Preservation of Existence, Etc

 

67

6.06

 

Maintenance of Properties

 

68

 

ii

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

 

 

 

 

Page

 

 

 

 

 

6.07

 

Maintenance of Insurance

 

68

6.08

 

Compliance with Laws

 

68

6.09

 

Books and Records

 

68

6.10

 

Inspection Rights

 

68

6.11

 

Use of Proceeds

 

68

6.12

 

Covenant to Guarantee Obligations and Give Security

 

69

6.13

 

Compliance with Environmental Laws

 

71

6.14

 

Further Assurances

 

72

6.15

 

Compliance with Terms of Leaseholds

 

72

6.16

 

Cash Collateral Accounts

 

72

ARTICLE VII

NEGATIVE COVENANTS

 

72

7.01

 

Liens

 

73

7.02

 

Indebtedness

 

74

7.03

 

Investments

 

75

7.04

 

Fundamental Changes

 

77

7.05

 

Dispositions

 

78

7.06

 

Restricted Payments

 

79

7.07

 

Change in Nature of Business

 

79

7.08

 

Transactions with Affiliates

 

79

7.09

 

Burdensome Agreements

 

80

7.10

 

Use of Proceeds

 

80

7.11

 

Financial Covenants

 

80

7.12

 

Amendments of Organization Documents

 

81

7.13

 

Accounting Changes

 

81

ARTICLE VIII

EVENTS OF DEFAULT AND REMEDIES

 

81

8.01

 

Events of Default

 

81

8.02

 

Remedies upon Event of Default

 

83

8.03

 

Application of Funds

 

84

ARTICLE IX

ADMINISTRATIVE AGENTS

 

85

9.01

 

Appointment and Authority

 

85

 

iii

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

 

 

 

 

Page

 

 

 

 

 

9.02

 

Rights as a Lender

 

85

9.03

 

Exculpatory Provisions

 

86

9.04

 

Reliance by Administrative Agent

 

87

9.05

 

Delegation of Duties

 

87

9.06

 

Resignation of Administrative Agent

 

87

9.07

 

Non-Reliance on Administrative Agents and Other Lenders

 

88

9.08

 

Administrative Agents May File Proofs of Claim

 

88

9.09

 

Collateral and Guaranty Matters

 

89

ARTICLE X

MISCELLANEOUS

 

90

10.01

 

Amendments, Etc

 

90

10.02

 

Notices; Effectiveness; Electronic Communications

 

91

10.03

 

No Waiver; Cumulative Remedies

 

93

10.04

 

Expenses; Indemnity; Damage Waiver

 

93

10.05

 

Payments Set Aside

 

95

10.06

 

Successors and Assigns

 

95

10.07

 

Treatment of Certain Information; Confidentiality

 

99

10.08

 

Right of Setoff

 

100

10.09

 

Interest Rate Limitation

 

101

10.10

 

Counterparts; Integration; Effectiveness

 

101

10.11

 

Survival of Representations and Warranties

 

101

10.12

 

Severability

 

101

10.13

 

Replacement of Lenders

 

102

10.14

 

GOVERNING LAW; JURISDICTION; ETC

 

102

10.15

 

WAIVER OF JURY TRIAL

 

103

10.16

 

No Advisory or Fiduciary Responsibility

 

103

10.17

 

USA PATRIOT Act Notice

 

104

10.18

 

California Judicial Reference

 

104

 

iv

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

 

SCHEDULES

 

 

 

2.01

 

Commitments and Applicable Percentages

 

 

5.06

 

Litigation

 

 

5.08(c)

 

Owned Real Property

 

 

5.08(d)

 

Leased Real Property

 

 

5.09

 

Environmental Matters

 

 

5.13

 

Subsidiaries and Other Equity Investments; Loan Parties

 

 

5.17

 

Intellectual Property Matters

 

 

6.12

 

Guarantors

 

 

7.01

 

Existing Liens

 

 

7.02

 

Existing Indebtedness

 

 

7.03

 

Existing Investments

 

 

7.08

 

Existing Transactions with Affiliates

 

 

7.09

 

Certain Existing Agreements

 

 

10.02

 

Administrative Agents’ Offices, Certain Addresses for Notices

 

 

10.06

 

Processing and Recordation Fees

 

 

 

EXHIBITS

Form of

A

 

Committed Loan Notice

B

 

Note

C

 

Compliance Certificate

D

 

Assignment and Assumption

E

 

Guaranty

F

 

Security Agreement

G

 

Opinion Matters – Counsel to Loan Parties

v

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

CREDIT AGREEMENT

This CREDIT AGREEMENT (“Agreement”) is entered into as of September 19, 2006,
among Guess ?, Inc., a Delaware corporation (the “Domestic Borrower”), Guess?
Canada Corporation, a Canadian corporation and wholly-owned subsidiary of the
Domestic Borrower (together with the Domestic Borrower, collectively, the
“Borrowers” and individually, a “Borrower”), each lender from time to time party
hereto (collectively, the “Lenders” and individually, a “Lender”), Bank of
America, N.A., as Domestic Administrative Agent and Domestic L/C Issuer, and
Bank of America, N.A., acting through its Canada Branch, as Canadian
Administrative Agent and Canadian L/C Issuer.

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

ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS

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

“Administrative Agents” means the Domestic Administrative Agent and the Canadian
Administrative Agent.

“Administrative Agent’s Office” means, with respect to either Administrative
Agent, such Administrative Agent’s address and, as appropriate, account as set
forth on Schedule 10.02, or such other address or account as such Administrative
Agent may from time to time notify to the Domestic Borrower and the Domestic
Lenders, or the Canadian Borrower and the Canadian Lenders, as the case may be.

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

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

“Aggregate Applicable Percentage” means at any time, with respect to each
Lender, a fraction (expressed as a percentage, carried out to the ninth decimal
place), the numerator of which is such Lender’s aggregate Commitments and the
denominator of which is the sum of the Aggregate Domestic Commitments and the
Dollar Equivalent of the Aggregate Canadian Commitments, in each case
immediately prior to any termination of the Commitments.

“Aggregate Canadian Commitments” means the Commitments of all the Canadian
Lenders with respect to the Canadian Loans and the Canadian Letters of Credit,
which shall not exceed the Dollar Equivalent of $15,000,000 in the aggregate,
subject to Section 2.13.

 

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

“Aggregate Commitments” means the Commitments of all the Lenders.

“Aggregate Credit Exposures” means, at any time, the sum of (i) the unused
portion of the Revolving Credit Facility at such time and (ii) the Total
Outstandings at such time.

“Aggregate Domestic Commitments” means the Commitments of all the Domestic
Lenders with respect to the Domestic Loans and the Domestic Letters of Credit,
which shall not exceed $70,000,000 in the aggregate, subject to Section 2.13.

“Agreement” means this Credit Agreement.

“Applicable Commitment Fee Percentage” means, at any time, in respect of the
Revolving Credit Facility, (a) from the Closing Date to the date on which the
Domestic Administrative Agent receives a Compliance Certificate pursuant to
Section 6.02(a) for the fiscal quarter ending September 30, 2006, 0.125% per
annum and (b) thereafter, the applicable percentage per annum set forth below
determined by reference to the Total Adjusted Leverage Ratio as set forth in the
most recent Compliance Certificate received by the Domestic Administrative Agent
pursuant to Section 6.02(a):

Applicable Commitment Fee Percentage

Pricing Level

 

Total Adjusted
Leverage Ratio

 

Commitment Fee

1

 

<3.00:1

 

0.125%

2

 

>3.00:1 but <4.00:1

 

0.250%

3

 

>4.00:1

 

0.375%

 

Any increase or decrease in the Applicable Commitment Fee Percentage resulting
from a change in the Total Adjusted Leverage Ratio shall become effective as of
the first Business Day immediately following the date a Compliance Certificate
is delivered pursuant to Section 6.02(a); provided, however, that if a
Compliance Certificate is not delivered when due in accordance with such
Section, then Pricing Level 3 shall apply as of the first Business Day after the
date on which such Compliance Certificate was required to have been delivered
until the date such Compliance Certificate is delivered.

“Applicable Percentage” means at any time, with respect to each Domestic Lender
in regard to the Domestic Loans and the Domestic Letters of Credit, or with
respect to each Canadian Lender in regard to the Canadian Loans, the Canadian
Letters of Credit, a fraction (expressed as a percentage, carried out to the
ninth decimal place), the numerator of which is the Dollar Equivalent amount of
the Commitment of such Lender at such time in regard to the Domestic Loans and
the Domestic Letters of Credit or in regard to the Canadian Loans and the
Canadian Letters of Credit, and the denominator of which is the amount of the
Aggregate Domestic Commitments or the Dollar Equivalent of the Aggregate
Canadian Commitments as applicable at such time.  If the commitment of each
Lender to make Loans and the obligation of the L/C Issuers to make L/C Credit
Extensions have been terminated pursuant to Section 8.02, or if the Commitments
have expired, then the Applicable Percentage of each Lender in respect of the
applicable

2

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

Facility shall be determined based on the Applicable Percentage of such Lender
in respect of such Facility most recently in effect, giving effect to any
subsequent assignments.  The initial Applicable Percentage of each Lender in
respect of each Facility is set forth opposite the name of such Lender on
Schedule 2.01 or in the Assignment and Assumption pursuant to which such Lender
becomes a party hereto, as applicable.

“Applicable Rate” means (i) from the Closing Date to the date on which the
Domestic Administrative Agent receives a Compliance Certificate pursuant to
Section 6.02(a) for the fiscal quarter ending September 30, 2006, 0.00% per
annum for Base Rate Loans and 0.75% per annum for Eurodollar Rate Loans and (ii)
thereafter, the applicable percentage per annum set forth below determined by
reference to the Total Adjusted Leverage Ratio as set forth in the most recent
Compliance Certificate received by the Domestic Administrative Agent pursuant to
Section 6.02(a):

Applicable Rate

Pricing Level

 

Total Adjusted
Leverage Ratio

 

Eurodollar Rate
(Standby Letters of Credit)

 

Base Rate

1

 

<2.00:1

 

0.50%

 

0.00%

2

 

>2.00:1 but <3.00:1

 

0.75%

 

0.00%

3

 

>3.00:1 but <4.00:1

 

1.00%

 

0.00%

4

 

>4.00:1

 

1.25%

 

0.25%

 

Any increase or decrease in the Applicable Rate resulting from a change in the
Total Adjusted Leverage Ratio shall become effective as of the first Business
Day immediately following the date a Compliance Certificate is delivered
pursuant to Section 6.02(a); provided, however, that if a Compliance Certificate
is not delivered when due in accordance with such Section, then Pricing Level 4
shall apply as of the first Business Day after the date on which such Compliance
Certificate was required to have been delivered until the date such Compliance
Certificate is delivered.

“Appropriate Lender” means, at any time, (a) with respect to either Facility, a
Lender that has a Commitment with respect to such Facility or holds a Committed
Loan under such Facility, at such time and (b) with respect to a Letter of
Credit Sublimit, (i) the applicable L/C Issuer and (ii) if any Letters of Credit
have been issued pursuant to Section 2.03(a), the Lenders holding a risk
participation therein.

“Approved Currency” means Dollars, Canadian Dollars and Euros.

“Approved Fund” means any Fund that is administered or managed by (a) a Lender,
(b) an Affiliate of a Lender or (c) an entity or an Affiliate of an entity that
administers or manages a Lender.

“Assignee Group” means two or more Eligible Assignees that are Affiliates of one
another or two or more Approved Funds managed by the same investment advisor.

“Assignment and Assumption” means an assignment and assumption entered into by a
Lender and an Eligible Assignee (with the consent of any party whose consent is

3

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

required by Section 10.06(b), and accepted by the applicable Administrative
Agent, in substantially the form of Exhibit D or any other form approved by the
applicable Administrative Agent.

“Attributable Indebtedness” means, on any date, (a) in respect of any
Capitalized Lease of any Person, the capitalized amount thereof that would
appear on a balance sheet of such Person prepared as of such date in accordance
with GAAP, (b) in respect of any Synthetic Lease Obligation, the capitalized
amount of the remaining lease or similar payments under the relevant lease or
other applicable agreement or instrument that would appear on a balance sheet of
such Person prepared as of such date in accordance with GAAP if such lease or
other agreement or instrument were accounted for as a Capitalized Lease and (c)
all Synthetic Debt of such Person.

“Audited Financial Statements” means the audited consolidated balance sheet of
the Domestic Borrower and its Subsidiaries for the fiscal year ended
December 31, 2005, and the related consolidated statements of income or
operations, shareholders’ equity and cash flows for such fiscal year of the
Domestic Borrower and its Subsidiaries, including the notes thereto.

“Auto-Extension Letter of Credit” has the meaning specified in Section 2.04(b).

“Availability Period” means the period from and including the Closing Date to
the earliest of (i) the Maturity Date, (ii) the date of termination of the
Commitments pursuant to Section 2.05, and (iii) the date of termination of the
commitment of each Lender to make Committed Loans and of the obligation of the
L/C Issuers to make L/C Credit Extensions pursuant to Section 8.02.

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

“Bank of America Canada” means Bank of America, N.A., acting through its Canada
Branch, and its successors.

“Base Rate” means for any day a fluctuating rate per annum equal to the higher
of (a) in the case of Domestic Loans, the Federal Funds Rate plus 1/2 of 1%, and
in the case of Canadian Loans, the average rate for 30 day Canadian Dollar
bankers’ acceptances that appears on the Reuters Screen CDOR Page at 10:00 a.m.
(Toronto time) on that day, plus 1/2 of 1% per annum, and (b) the rate of
interest in effect for such day as publicly announced from time to time by Bank
of America (in the case of Domestic Loans) as its “prime rate” for loans in
Dollars or Bank of America Canada (in the case of Canadian Loans) as its “prime
rate” for loans in Canadian Dollars.  The “prime rate” is a rate set by Bank of
America or Bank of America Canada (as applicable) based upon various factors
including its costs and desired return, general economic conditions and other
factors, and is used as a reference point for pricing some loans, which may be
priced at, above, or below such announced rate.  Any change in such rate
announced by Bank of America or Bank of America Canada (as applicable) shall
take effect at the opening of business on the day specified in the public
announcement of such change.

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

4

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

“Borrower Materials” has the meaning specified in Section 6.02.

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

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

“Canadian Administrative Agent” means Bank of America Canada in its capacity as
Canadian administrative agent under any of the Loan Documents, or any Canadian
Lender which is a successor Canadian administrative agent hereunder.

“Canadian Borrower” means Guess? Canada Corporation, a Canadian corporation and
wholly-owned subsidiary of the Domestic Borrower, or any successor thereto.

“Canadian Dollar” and “Cdn. $” mean lawful money of Canada.

“Canadian Facility” means, at any time, the aggregate amount of the Canadian
Lenders’ Commitments at such time.

“Canadian L/C Issuer” means Bank of America Canada in its capacity as issuer of
Canadian Letters of Credit hereunder, or if Bank of America Canada shall have
resigned as Canadian Administrative Agent, any other Canadian Lender and any
successor issuer of Canadian Letters of Credit hereunder.

“Canadian Lender” means any Lender which is either (i) a resident of Canada
within the meaning of the ITA or (ii) a deemed resident of Canada pursuant to
subsection 212 (13.3) of the ITA in respect of any amount paid or credited
hereunder and in either case identified as a Canadian Lender on Schedule 2.01 as
amended or modified from time to time in accordance with this Agreement.

“Canadian Letter of Credit” means any Letter of Credit issued by the Canadian
L/C Issuer for the account of the Canadian Borrower.

“Canadian Letter of Credit Sublimit” means the Letter of Credit Sublimit for
Canadian Letters of Credit.

“Canadian Loan” means any Loan extended by a Canadian Lender to the Canadian
Borrower.

5

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

“Canadian Subsidiary” means any Subsidiary that is organized under the laws of
Canada or any political subdivision of Canada.

“Capital Expenditures” means, with respect to any Person for any period, any
expenditure categorized as a capital expenditure in such Person’s financial
statements prepared in accordance with GAAP.

“Capitalized Leases” means all leases that have been or should be, in accordance
with GAAP, recorded as capitalized leases.

“Cash Collateral Account” means a blocked, non-interest bearing deposit account
of one or more of the Loan Parties at Bank of America or Bank of America Canada
(or another commercial bank selected in compliance with Section 6.16) in the
name of the applicable Administrative Agent and under the sole dominion and
control of such Administrative Agent, and otherwise established in a manner
satisfactory to such Administrative Agent.

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

“Cash Equivalents” means any of the following types of Investments, to the
extent owned by a Borrower or any of its Subsidiaries free and clear of all
Liens (other than Liens created under the Collateral Documents and other Liens
permitted hereunder):

(a)           readily marketable obligations issued or directly and fully
guaranteed or insured by the United States of America or any agency or
instrumentality thereof having maturities of not more than 360 days from the
date of acquisition thereof; provided that the full faith and credit of the
United States of America is pledged in support thereof;

(b)           time deposits with, or insured certificates of deposit or bankers’
acceptances of, any commercial bank that (i) (A) is a Lender or (B) is organized
under the laws of the United States of America, any state thereof or the
District of Columbia or is the principal banking subsidiary of a bank holding
company organized under the laws of the United States of America, any state
thereof or the District of Columbia, and is a member of the Federal Reserve
System, and (ii) has combined capital and surplus of at least $250,000,000, in
each case with maturities of not more than 90 days from the date of acquisition
thereof;

(c)           commercial paper issued by any Person organized under the laws of
any state of the United States of America and rated at least “Prime-1” (or the
then equivalent grade) by Moody’s or at least “A-1” (or the then equivalent
grade) by S&P, in each case with maturities of not more than 180 days from the
date of acquisition thereof;

(d)           repurchase obligations with a term of not more than 30 days for
underlying securities of the types described in clause (a) above entered into
with any financial institution having combined capital and surplus of at least
$250,000,000;

(e)           repurchase agreements and reverse repurchase agreements relating
to marketable direct obligations issued or unconditionally guaranteed by the
United States

6

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

of America or issued by any governmental agency thereof and backed by the full
faith and credit to the United States of America, in each case maturing within
90 days or less from the date of acquisition; provided, that the terms of such
agreements comply with the guidelines set forth in the Federal Financial
Agreements of Depository Institutions with Securities Dealers and Others, as
adopted by the Comptroller of the Currency on October 31, 1985;

(f)            any evidence of Indebtedness issued by a state, city, town,
county or their agencies and paying interest which is exempt from federal tax,
provided that the maturity is 180 days or less and the Indebtedness is rated at
least A-1, SP-1 or AAA by S&P or at least P-1, MIG-1 or Aaa by Moody’s; and

(g)           Investments, classified in accordance with GAAP as current assets
of the Domestic Borrower or any of its Subsidiaries, in money market investment
programs registered under the Investment Company Act of 1940, which are
administered by financial institutions that have the highest rating obtainable
from either Moody’s or S&P, and the portfolios of which are limited solely to
Investments of the character, quality and maturity described in clauses (a)
through (f) of this definition.

Without limitation of the foregoing, with respect to the Canadian Borrower and
its Subsidiaries, the term “Cash Equivalents” shall include any Canadian
Investments that are substantially similar to any of the foregoing.

“Cash Management Agreement” means any agreement to provide cash management
services, including treasury, depository, overdraft, credit or debit card,
electronic funds transfer and other cash management arrangements.

“Cash Management Bank” means any Person that, at the time it enters into a Cash
Management Agreement, is a Lender or an Affiliate of a Lender, in its capacity
as a party to such Cash Management Agreement.

“CERCLA” means the Comprehensive Environmental Response, Compensation and
Liability Act of 1980.

“CERCLIS” means the Comprehensive Environmental Response, Compensation and
Liability Information System maintained by the U.S. Environmental Protection
Agency.

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

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

7

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

(a)           any “person” or “group” (as such terms are used in Sections 13(d)
and 14(d) of the Securities Exchange Act of 1934, but excluding any Permitted
Holder or any employee benefit plan of such person or its subsidiaries, and any
person or entity acting in its capacity as trustee, agent or other fiduciary or
administrator of any such plan) other than the Permitted Holders becomes the
“beneficial owner” (as defined in Rules 13d-3 and 13d-5 under the Securities
Exchange Act of 1934, except that a person or group shall be deemed to have
“beneficial ownership” of all securities that such person or group has the right
to acquire, whether such right is exercisable immediately or only after the
passage of time (such right, an “option right”) directly or indirectly, of 50%
or more of the equity securities of the Domestic Borrower entitled to vote for
members of the board of directors or equivalent governing body of the Domestic
Borrower on a fully-diluted basis (and taking into account all such securities
that such “person” or “group” has the right to acquire pursuant to any option
right); or

(b)           any Person or two or more Persons (excluding any Permitted Holder)
acting in concert shall have acquired by contract or otherwise, or shall have
entered into a contract or arrangement that, upon consummation thereof, will
result in its or their acquisition of the power to exercise, directly or
indirectly, control of the management or policies of the Domestic Borrower, or
control over the equity securities of the Domestic Borrower entitled to vote for
members of the board of directors or equivalent governing body of the Domestic
Borrower on a fully-diluted basis (and taking into account all such securities
that such Person or Persons have the right to acquire pursuant to any option
right) representing 50% or more of the combined voting power of such securities;
or

(c)           a “change of control” or any comparable term under, and as defined
in, the Senior Notes Documents shall have occurred.

“Closing Date” means the first date all the conditions precedent in Section 4.01
are satisfied or waived in accordance with Section 10.01.

“Code” means the Internal Revenue Code of 1986.

“Collateral” means all of the “Collateral” referred to in the Collateral
Documents and all of the other property that is or is intended under the terms
of the Collateral Documents to be subject to Liens in favor of the
Administrative Agent for the benefit of the Secured Parties.

“Collateral Documents” means, collectively, the Pledge Agreement, the Security
Agreement, each of the Security Agreement Supplements, security agreements,
pledge agreements or other similar agreements delivered to the Domestic
Administrative Agent pursuant to Section 6.12, and each of the other agreements,
instruments or documents that creates or purports to create a Lien in favor of
the Domestic Administrative Agent for the benefit of the Secured Parties.

“Commitment” means the Revolving Credit Commitment of each Lender.  The
Commitments of the Domestic Lenders shall be denominated in Dollars and inure to
the

8

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

benefit of the Domestic Borrower.  The Commitments of the Canadian Lenders shall
be denominated in Canadian Dollars and inure to the benefit of the Canadian
Borrower.

“Committed Borrowing” means a borrowing consisting of simultaneous Committed
Loans of the same Type and, in the case of Eurodollar Rate Committed Loans,
having the same Interest Period.

“Committed Canadian Loan” has the meaning specified in Section 2.01(b).

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

“Committed Loan” means a Committed Domestic Loan or a Committed Canadian Loan.

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

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

“Consolidated Fixed Charge Coverage Ratio” means, at any date of determination,
the ratio of (a) (i) EBITDAR, less (ii) the aggregate amount of Federal, state,
local and foreign income taxes paid in cash, less (iii) the aggregate amount of
all Maintenance Capital Expenditures (but in no event less than $10,000,000) to
(b) the sum of (i) Consolidated Interest Charges, (ii) the aggregate principal
amount of all regularly scheduled and/or contractual principal payments or
redemptions or similar acquisitions for value of outstanding debt for borrowed
money, but excluding any such payments to the extent refinanced through the
incurrence of additional Indebtedness otherwise expressly permitted under
Section 7.02, (iii) real property rental expense and (iv) the aggregate amount
of all Restricted Payments (exclusive of any Restricted Payments permitted
pursuant to Section 7.06(e)), in each case, of or by the Domestic Borrower and
its Subsidiaries for the most recently completed four fiscal quarter period.

“Consolidated Funded Indebtedness” means, as of any date of determination, for
the Domestic Borrower and its Subsidiaries on a consolidated basis, the sum of
(a) the outstanding principal amount of all obligations, whether current or
long-term, for borrowed money (including Obligations hereunder) and all
obligations evidenced by bonds, debentures, notes, loan agreements or other
similar instruments, (b) without duplication of amounts included in clauses (a),
(c) or (d) hereof, all direct obligations arising under letters of credit
(including standby and commercial), bankers’ acceptances, bank guaranties,
surety bonds, shipside bonds and similar instruments, (c) all obligations in
respect of the deferred purchase price of property or services (other than trade
accounts payable in the ordinary course of business, accrued expenses, earn-outs
and purchase price adjustments, consultant fees, payroll and bonus payments to
employees, and other similar obligations, in each case only to the extent that
such obligation is not classified as indebtedness under GAAP), (d) all
Attributable Indebtedness, (e) without duplication, all

9

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

Guarantees with respect to outstanding Indebtedness of the types specified in
clauses (a) through (d) above of Persons other than the Domestic Borrower or any
Subsidiary, and (f) all Indebtedness of the types referred to in clauses (a)
through (f) above of any partnership or joint venture (other than a joint
venture that is itself a corporation or limited liability company) in which the
Domestic Borrower or a Subsidiary is a general partner or joint venturer, unless
such Indebtedness is expressly made non-recourse to the Domestic Borrower or
such Subsidiary.

“Consolidated Interest Charges” means, for any period of four fiscal quarters of
the Domestic Borrower and its Subsidiaries, the sum of (a) all interest, premium
payments, debt discount, fees, charges and related expenses in connection with
borrowed money (including capitalized interest) or in connection with the
deferred purchase price of assets, in each case to the extent treated as
interest in accordance with GAAP, plus (b) the portion of rent expense under
Capitalized Leases that is treated as interest in accordance with GAAP, in each
case, of or by the Domestic Borrower and its Subsidiaries on a consolidated
basis for the most recently completed period of four fiscal quarters of the
Domestic Borrower.

“Consolidated Net Income” means, at any date of determination, the net income
(or loss) of the Domestic Borrower and its Subsidiaries on a consolidated basis
and in accordance with GAAP for the most recently completed four fiscal quarter
period; provided that Consolidated Net Income shall exclude extraordinary gains
and extraordinary losses for such period.

“Contractual Obligation” means, as to any Person, any provision of any security
issued by such Person or of any material agreement, instrument or other
undertaking to which such Person is a party.

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

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

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

10

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

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

“Defaulting Lender” means any Lender that (a) has failed to fund any portion of
the Committed Loans or participations in L/C Obligations required to be funded
by it hereunder within one Business Day of the date required to be funded by it
hereunder, (b) has otherwise failed to pay over to the applicable Administrative
Agent or any other Lender any other amount required to be paid by it hereunder
within one Business Day of the date when due, unless the subject of a good faith
dispute, or (c) has been deemed insolvent or become the subject of a bankruptcy
or insolvency proceeding.

“Disclosed Litigation” has the meaning set forth in Section 5.06.

“Disposition” or “Dispose” means the sale, transfer, license, lease or other
disposition (including any sale and leaseback transaction) of any property
(other than cash) by any Person (or the granting of any option or other right to
do any of the foregoing), including any sale, assignment, transfer or other
disposal, with or without recourse, of any notes or accounts receivable or any
rights and claims associated therewith.  For the avoidance of doubt, the grant
of a Lien or security interest in any assets (including but not limited to
accounts receivable) shall not constitute a “Disposition” for purposes of this
Agreement.

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

“Dollar Equivalents” means, with respect to any amounts of Canadian Dollars, an
equivalent amount of Dollars determined in accordance with subsection 1.07.

“Domestic Administrative Agent” means Bank of America in its capacity as
domestic administrative agent under any of the Loan Documents, or any successor
domestic administrative agent.

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

“Domestic Facility” means, at any time, the aggregate amount of the Domestic
Lenders’ Commitments at such time.

“Domestic L/C Issuer” means Bank of America in its capacity as issuer of
Domestic Letters of Credit hereunder, or if Bank of America shall have resigned
as Domestic Administrative Agent, any other Domestic Lender and any successor
issuer of Domestic Letters of Credit hereunder.

11

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

“Domestic Lender” means any Lender identified as a Domestic Lender on
Schedule 2.01 as amended or modified from time to time in accordance with this
Agreement.

“Domestic Letter of Credit” means any Letter of Credit issued by the Domestic
L/C Issuer for the account of the Domestic Borrower.

“Domestic Letter of Credit Sublimit” means the Letter of Credit Sublimit for
Domestic Letters of Credit.

“Domestic Loan” means any Loan extended by a Domestic Lender to the Domestic
Borrower.

“Domestic Subsidiary” means any Subsidiary that is organized under the laws of
any political subdivision of the United States.

“EBITDAR” means, at any date of determination, an amount equal to Consolidated
Net Income (including income recognized from deferred revenues on payments made
by licensees) of the Domestic Borrower and its Subsidiaries on a consolidated
basis for the most recently completed four fiscal quarters plus (a) the
following to the extent deducted in calculating such Consolidated Net Income: 
(i) Consolidated Interest Charges, (ii) the provision for Federal, state, local
and foreign income Taxes payable, (iii) depreciation and amortization expense
(including stock-based award expense amortization), (iv) real property rental
expense, (v) customary fees, costs and expenses incurred in connection with any
equity or debt offering, Investments or Indebtedness permitted by this Agreement
or in connection with the consummation of acquisitions permitted pursuant to
Section 7.03(h), (vi) restructuring charges or reserves (including, without
limitation, non-cash retention, severance, systems establishment costs, excess
pension charges, contract termination costs including future lease commitments,
and costs to consolidate facilities and relocate employees) in an aggregate
amount not to exceed $50,000,000 through the Maturity Date and (vii) other
non-recurring expenses (excluding losses generated from barter transactions)
reducing such Consolidated Net Income which do not represent a cash item in such
period or any future period (in each case of or by the Domestic Borrower and its
Subsidiaries for such four fiscal quarter period) and minus (b) the following to
the extent included in calculating such Consolidated Net Income:  (i) Federal,
state, local and foreign income Tax credits and (ii) all non-recurring non-cash
items (excluding gains generated from barter transactions) increasing
Consolidated Net Income (in each case of or by the Domestic Borrower and its
Subsidiaries for such four fiscal quarter period).

“Eligible Assignee” means any Person that meets the requirements to be an
assignee under Section 10.06(b)(iii), (v), (vi) and (vii) (subject to such
consents, if any, as may be required under Section 10.06(b)(iii)).

“Environmental Laws” means any and all Federal, state, provincial, local, and
foreign statutes, laws, regulations, ordinances, rules, judgments, orders,
decrees, permits, concessions, grants, franchises, licenses, agreements or
governmental restrictions relating

12

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

to pollution and the protection of the environment or the release of any
materials into the environment, including those related to hazardous substances
or wastes, air emissions and discharges to waste or public systems.

“Environmental Liability” means any liability, contingent or otherwise
(including any liability for damages, costs of environmental remediation, fines,
penalties or indemnities), of either Borrower, any other Loan Party or any of
their respective Subsidiaries 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.

“Environmental Permit” means any material permit, approval, identification
number license or other authorization required under any Environmental Law.

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

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

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

“ERISA Event” means (a) a Reportable Event with respect to a Pension Plan; (b) a
withdrawal by the Domestic Borrower or any ERISA Affiliate from a Pension Plan
subject to Section 4063 of ERISA during a plan year in which it was a
substantial employer (as defined in Section 4001(a)(2) of ERISA) or a cessation
of operations that is treated as such a withdrawal under Section 4062(e) of
ERISA; (c) a complete or partial withdrawal by the Domestic Borrower or any
ERISA Affiliate from a Multiemployer Plan or notification that a Multiemployer
Plan is in reorganization; (d) the filing of a notice of intent to terminate,
the treatment of a Plan amendment as a termination under Section 4041 or 4041A
of ERISA, or the commencement of proceedings by the PBGC to terminate a Pension
Plan or Multiemployer Plan; (e) an event or condition which constitutes grounds
under Section 4042 of ERISA for the termination of, or the appointment of a
trustee to administer, any Pension Plan or Multiemployer Plan; or (f)

13

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

the imposition of any liability under Title IV of ERISA, other than for PBGC
premiums due but not delinquent under Section 4007 of ERISA, upon the Domestic
Borrower or any ERISA Affiliate.

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

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

“Event of Default” has the meaning specified in Section 8.01.

“Excluded Taxes” means, with respect to either Administrative Agent, any Lender,
any L/C Issuer or any other recipient of any payment to be made by or on account
of any obligation of either Borrower hereunder, (a) Taxes imposed on or measured
by its overall net income, assets or capital (however denominated) and franchise
Taxes imposed on it (in lieu of net income Taxes) by (i) the United States or
Canada (or any political subdivision thereof), (ii) any other Governmental
Authority under the laws of which any Lender or Administrative Agent (as the
case may be) is organized or has its principal office or maintains its
applicable Lending Office or in which the Lender or Administrative Agent is
otherwise carrying on business or is deemed to be carrying on business, or (iii)
any Governmental Authority solely as a result of a present or former connection
between such recipient and the jurisdiction of such Governmental Authority
(other than any such connection arising solely from such recipient having
executed, delivered or performed its obligations or received a payment under, or
enforced, any of the Loan Documents), (b) any branch profits Taxes imposed by
the United States or any similar Tax imposed by Canada or any other jurisdiction
in which the applicable Borrower is located, and (c) any withholding, backup
withholding or similar Tax that is (i) imposed on amounts payable to such
recipient at the time such recipient becomes a party hereto or otherwise
acquires an interest hereunder (or

14

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

designates a new Lending Office), (ii) attributable to such recipient’s failure
or inability (other than as a result of a Change in Law occurring after the time
such recipient becomes a party hereto or otherwise acquires a beneficial
interest hereunder (or designates a new Lending Office)) to comply with
Section 3.01(e), except to the extent that such recipient (or its assignor, if
any) was entitled, at the time of designation of a new Lending Office (or
assignment), to receive additional amounts from the Borrower with respect to
such Tax pursuant to Section 3.01(a), or (iii) required to be deducted under
applicable law from any payment hereunder on the basis of the information
provided by such recipient pursuant to Section 3.01(e).

“Existing Credit Agreement” means (i) that certain Amended and Restated Loan and
Security Agreement dated as of December 20, 2002 among the Domestic Borrower,
Guess? Retail, Inc., Guess.com, Inc., Wachovia Securities, Inc., as arranger,
and the lenders party thereto, as amended from time to time and (ii) that
certain Canadian Loan and Security Agreement dated as of December 20, 2002 among
the Canadian Borrower, Guess? Canada Retail, Inc., and Wachovia Securities,
Inc., as arranger, and the lenders party thereto, as amended from time to time.

“Facility” means each of the Domestic Facility and the Canadian Facility.

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

“Fee Letter” means the letter agreement, dated September 19, 2006, among the
Domestic Borrower and the Domestic Administrative Agent.

“Foreign Subsidiary” means any Subsidiary that is organized under the laws of
any jurisdiction other than a political subdivision of the United States.

“Foreign Subsidiary Restructuring” means (i) the transfer of the equity
interests of the Canadian Borrower such that the Canadian Borrower becomes a
second- or lower-tier Foreign Subsidiary of the Domestic Borrower, (ii)
conversion, transfer or other corporate restructuring of the Canadian Borrower
to another form of entity or entities (including but not limited to a
partnership or limited liability company), and (iii) transfer of the equity
interests of Guess? Europe, B.V. such that Guess? Europe, B.V. becomes a second-
or lower-tier Foreign Subsidiary of the Domestic Borrower.

15

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

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

“Fund” means any Person (other than a natural person) that is (or will be)
engaged in making, purchasing, holding or otherwise investing in commercial
loans and similar extensions of credit in the ordinary course of its business.

“GAAP” means generally accepted accounting principles in the United States set
forth in the opinions and pronouncements of the Accounting Principles Board and
the American Institute of Certified Public Accountants and statements and
pronouncements of the Financial Accounting Standards Board or such other
principles as may be approved by a significant segment of the accounting
profession in the United States, that are applicable to the circumstances as of
the date of determination, consistently applied.

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

“Granting Lender” has the meaning specified in Section 10.06(h).

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

16

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

“Guaranty” means, collectively, the Guaranty made by Domestic Borrower and the
Guarantors in favor of the Secured Parties, substantially in the form of
Exhibit E, together with each other guaranty and guaranty supplement delivered
pursuant to Section 6.12.

“Guarantors” means, collectively, the Subsidiaries of the Domestic Borrower
listed on Schedule 6.12 and each other Subsidiary of the Domestic Borrower that
shall be required to execute and deliver a guaranty or guaranty supplement
pursuant to Section 6.12, but excluding Guess? Royalty Finance LLC, Guess?
Licensing, Inc., Guess? IP GP LLC, Guess? IP LP LLC and Guess? IP Holder L.P.

“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.

“Hedge Bank” means any Person that, at the time it enters into a Secured Hedge
Agreement, is a Lender or an Affiliate of a Lender, in its capacity as a party
to such Secured Hedge Agreement.

“Hong Kong Subfacility” means the subfacility of the Letter of Credit Sublimits
described in Section 2.14.

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

(a)           all obligations of such Person for borrowed money and all
obligations of such Person evidenced by bonds, debentures, notes, loan
agreements or other similar instruments;

(b)           all direct or contingent obligations of such Person arising under
outstanding letters of credit (including standby and commercial), bankers’
acceptances, bank guaranties, surety bonds and similar instruments;

(c)           net obligations of such Person under any Swap Contract;

(d)           all obligations of such Person to pay the deferred purchase price
of property or services (other than trade accounts payable in the ordinary
course of business, accrued expenses, earn-outs and purchase price adjustments,
consultant fees, payroll and bonus payments to employees, and other similar
obligations, in each case only to the extent that such accounts, expenses,
earn-outs, adjustments and similar obligations are not classified as
indebtedness under GAAP);

(e)           indebtedness (excluding prepaid interest thereon) secured by a
Lien on property owned or being purchased by such Person (including indebtedness
arising under

17

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

conditional sales or other title retention agreements), whether or not such
indebtedness shall have been assumed by such Person or is limited in recourse;

(f)            all Attributable Indebtedness in respect of Capitalized Leases
and Synthetic Lease Obligations of such Person and all Synthetic Debt of such
Person;

(g)           to the extent that any of the following shall be classified as
indebtedness under GAAP, obligations of such Person to purchase, redeem, retire,
defease or otherwise make any payment in respect of any Equity Interest in such
Person or any other Person or any warrant, right or option to acquire such
Equity Interest, valued, in the case of a redeemable preferred interest, at the
greater of its voluntary or involuntary liquidation preference plus accrued and
unpaid dividends; and

(h)           all Guarantees of such Person in respect of any of the foregoing.

For all purposes hereof, the Indebtedness of any Person shall include the
Indebtedness of any partnership or joint venture (other than a joint venture
that is itself a corporation or limited liability company) in which such Person
is a general partner or a joint venturer, unless such Indebtedness is expressly
made non-recourse to such Person.  The amount of any net obligation under any
Swap Contract on any date shall be deemed to be the Swap Termination Value
thereof as of such date.  Capitalized Lease or Synthetic Lease Obligations as of
any date shall be deemed to be the amount of Attributable Indebtedness in
respect thereof as of such date.

“Indemnified Taxes” means Taxes other than Excluded Taxes.

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

“Information” has the meaning specified in Section 10.07.

“Interbank Reference Rate” means the interest rate expressed as a percentage per
annum which is customarily used by the Canadian Administrative Agent when
calculating interest due by it or owing to it arising from correction of errors
between it and other chartered banks.

“Interest Payment Date” means, (a) as to any Eurodollar Rate Loan, the last day
of each Interest Period applicable to such Loan and the Maturity Date; provided,
however, that if any Interest Period for a Eurodollar Rate Loan exceeds three
months, the respective dates that fall every three months after the beginning of
such Interest Period shall also be Interest Payment Dates; and (b) as to any
Base Rate Loan, the last Business Day of each March, June, September and
December and the Maturity Date.

“Interest Period” means, as to each Eurodollar Rate Loan, the period commencing
on the date such Eurodollar Rate Loan is disbursed or converted to or continued
as a Eurodollar Rate Loan and ending on the date one, two, three, six or nine
months thereafter, as selected by a Borrower in its Committed Loan Notice
provided that:

18

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

(a)           any Interest Period that would otherwise end on a day that is not
a Business Day shall be extended to the next succeeding Business Day unless such
Business Day falls in another calendar month, in which case such Interest Period
shall end on the next preceding Business Day;

(b)           any Interest Period that begins on the last Business Day of a
calendar month (or on a day for which there is no numerically corresponding day
in the calendar month at the end of such Interest Period) shall end on the last
Business Day of the calendar month at the end of such Interest Period; and

(c)           no Interest Period shall extend beyond the Maturity Date.

“Internal Control Event” means a material weakness in, or fraud that involves
management or other employees who have a significant role in, the Domestic
Borrower’s internal controls over financial reporting, in each case as described
in the Securities Laws.

“Investment” means, as to any Person, any direct or indirect acquisition or
investment by such Person, whether by means of (a) the purchase or other
acquisition of Equity Interests of another Person, (b) a loan, advance or
capital contribution to, Guarantee or assumption of debt of, or purchase or
other acquisition of any other debt or interest in, another Person, or (c) the
purchase or other acquisition (in one transaction or a series of transactions)
of assets of another Person that constitute a business unit or all or a
substantial part of the business of, such Person.  For purposes of covenant
compliance, the amount of any Investment shall be the amount actually invested,
without adjustment for subsequent increases or decreases in the value of such
Investment.  For the avoidance of doubt, the purchase of aircraft shall not
constitute an “Investment” for purposes of this Agreement.

“IP Rights” has the meaning specified in Section 5.17.

“IRS” means the United States Internal Revenue Service.

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

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

“ITA” means the Income Tax Act (Canada).

“Laws” means, collectively, all international, foreign, Federal, state,
provincial and local statutes, treaties, rules, guidelines, regulations,
ordinances, codes and administrative or judicial precedents or authorities,
including the interpretation or administration thereof by any Governmental
Authority charged with the enforcement,

19

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

interpretation or administration thereof, and all applicable administrative
orders, directed duties, requests, licenses, authorizations and permits of, and
agreements with, any Governmental Authority, in each case whether or not having
the force of law.

“L/C Advance” means, with respect to each Lender, such Lender’s funding of its
participation in any L/C Borrowing in accordance with its Applicable Percentage.

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

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

“L/C Issuers” means collectively, the Domestic L/C Issuer and the Canadian L/C
Issuer.

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

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

“Lending Office” means, as to any Lender, the office or offices of such Lender
described as such in such Lender’s Administrative Questionnaire, or such other
office or offices as a Lender may from time to time notify the Domestic Borrower
and the Domestic Administrative Agent.

“Letter of Credit” means any letter of credit issued hereunder.  A Letter of
Credit may be a commercial letter of credit or a standby letter of credit.

“Letter of Credit Application” means an application and agreement for the
issuance or amendment of a Letter of Credit in the form from time to time in use
by the applicable L/C Issuer.

“Letter of Credit Expiration Date” means the day that is seven days prior to the
Maturity Date then in effect (or, if such day is not a Business Day, the next
preceding Business Day).

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

20

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

“Letter of Credit Sublimit” means, with respect to the Domestic Letters of
Credit, an amount equal to Sixty Million Dollars ($60,000,000) and, with respect
to the Canadian Letters of Credit, an amount equal to Fifteen Million Dollars
($15,000,000).  The applicable Letter of Credit Sublimit is part of, and not in
addition to, the Aggregate Domestic Commitments and the Aggregate Canadian
Commitments, respectively.

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

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

“Loan Documents” means, collectively, (a) this Agreement, (b) the Notes, (c) the
Guaranty, (d) the Collateral Documents, (e) the Fee Letter, (f) each Issuer
Document, (g) each Secured Hedge Agreement, (h) each Secured Cash Management
Agreement and (i) each Secured Foreign Exchange Agreement.

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

“Maintenance Capital Expenditures” means capital expenditures for the
maintenance, repair, restoration or refurbishment of tangible property, but
excluding any Capital Expenditures which adds to or significantly improves any
such property.

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

“Maturity Date” means September 30, 2011; provided, however, that, in each case,
if such date is not a Business Day, the Maturity Date shall be the next
preceding Business Day.

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

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

“Non-Extension Notice Date” has the meaning specified in Section 2.04(b)(iii).

21

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

“Note” means a promissory note made by a Borrower in favor of a Lender
evidencing Loans made by such Lender, substantially in the form of Exhibit B.

“NPL” means the National Priorities List under CERCLA.

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

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

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

“Outstanding Amount” means (a) with respect to Committed Loans on any date, the
aggregate outstanding principal amount thereof after giving effect to any
borrowings and prepayments or repayments of Committed Loans occurring on such
date; and (b) with respect to any L/C Obligations on any date, the amount of
such L/C Obligations on such date after giving effect to any L/C Credit
Extension occurring on such date and any other changes in the aggregate amount
of the L/C Obligations as of such date, including as a result of any
reimbursements by a Borrower of Unreimbursed Amounts.

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

“PBGC” means the Pension Benefit Guaranty Corporation.

“PCAOB” means the Public Company Accounting Oversight Board.

“Pension Plan” means any “employee pension benefit plan” (as such term is
defined in Section 3(2) of ERISA), other than a Multiemployer Plan, that is
subject to Title IV of ERISA and is sponsored or maintained by the Domestic
Borrower or any

22

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

ERISA Affiliate or to which the Domestic Borrower or any ERISA Affiliate
contributes or has an obligation to contribute, or in the case of a multiple
employer or other plan described in Section 4064(a) of ERISA, has made
contributions at any time during the immediately preceding five plan years.

“Permitted Holder” means collectively Paul Marciano, the Paul Marciano Trust,
Marciano Financial Holdings II, LLC, the Paul Marciano Foundation, Maurice
Marciano, the Maurice Marciano Trust, the Maurice Marciano Family Foundation,
and as to Paul Marciano and Maurice Marciano, the members of their families,
their respective estates, spouses, heirs and any trust of which one or more of
the foregoing are the trustors, the trustees and/or the beneficiaries.

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

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

“Platform” has the meaning specified in Section 6.02.

“Pledge Agreement” means the Pledge Agreement delivered in accordance with
Section 4.01(iv) by the Domestic Borrower and each Domestic Subsidiary that
holds Equity Interests in another Domestic Subsidiary or in a first-tier Foreign
Subsidiary, together with any supplement delivered pursuant to Section 6.12.

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

“Registered Public Accounting Firm” has the meaning specified by the Securities
Laws and shall be independent of the Domestic Borrower as prescribed by the
Securities Laws.

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

“Reportable Event” means any of the events set forth in Section 4043(c) of
ERISA, other than events for which the 30 day notice period has been waived.

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

“Required Lenders” means, as of any date of determination, Lenders holding more
than 50% of the sum of the (a) Total Outstandings (with the aggregate amount of
each Lender’s risk participation and funded participation in L/C Obligations
being deemed “held” by such Lender for purposes of this definition) and (b)
aggregate unused

23

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

Revolving Credit Commitments; provided that the unused Revolving Credit
Commitment of, and the portion of the Total Outstandings held or deemed held by,
any Defaulting Lender shall be excluded for purposes of making a determination
of Required Lenders.

“Responsible Officer” means the chief executive officer, president, chief
operating officer, chief financial officer, treasurer, assistant treasurer,
controller or vice president of finance of a Loan Party and any other officer of
the applicable Loan Party so designated by any of the foregoing officers in a
notice to the applicable Administrative Agent.  Any document delivered hereunder
that is signed by a Responsible Officer of a Loan Party shall be conclusively
presumed to have been authorized by all necessary corporate, partnership and/or
other action on the part of such Loan Party and such Responsible Officer shall
be conclusively presumed to have acted on behalf of such Loan Party.

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

“Revolving Credit Commitment” means, as to each Lender, its obligation to (a)
make Loans to the Borrowers pursuant to Section 2.01 and (b) purchase
participations in L/C Obligations, in an aggregate principal amount at any one
time outstanding not to exceed the amount set forth opposite such Lender’s name
on Schedule 2.01 under the caption “Revolving Credit Commitment” or opposite
such caption in the Assignment and Assumption pursuant to which such Lender
becomes a party hereto, as applicable, as such amount may be adjusted from time
to time in accordance with this Agreement.

“Revolving Credit Facility” means, at any time, the aggregate amount of the
Lenders’ Revolving Credit Commitments at such time.

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

“Sarbanes-Oxley” means the Sarbanes-Oxley Act of 2002.

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

“Secured Cash Management Agreement” means any Cash Management Agreement that is
entered into by and between a Borrower and any Cash Management Bank.

24

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

“Secured Foreign Exchange Agreement” means any agreement to provide foreign
exchange services that is entered into by and between a Borrower and any Lender
or an Affiliate of a Lender.

“Secured Hedge Agreement” means any interest rate or foreign currency Swap
Contract permitted under Article VI or VII that is entered into by and between a
Borrower and any Hedge Bank.

“Secured Parties” means, collectively, the Administrative Agents, the Lenders,
the L/C Issuers, the Hedge Banks, the Cash Management Banks, the Lenders (or
Affiliates thereof) party to any Secured Foreign Exchange Agreement, each
co-agent or sub-agent appointed by an Administrative Agent from time to time
pursuant to Section 9.05, and the other Persons the Obligations owing to which
are or are purported to be secured by the Collateral under the terms of the
Collateral Documents.

“Securities Laws” means the Securities Act of 1933, the Securities Exchange Act
of 1934, Sarbanes-Oxley, and the applicable accounting and auditing principles,
rules, standards and practices promulgated, approved or incorporated by the SEC
or the PCAOB.

“Security Agreement” has the meaning specified in Section 4.01(a)(iii).

“Security Agreement Supplement” means a supplement to the Security Agreement, in
form and substance satisfactory to the Domestic Borrower and the Domestic
Administrative Agent.

“Senior Notes” means the 6.75% secured senior notes of Guess? Royalty Finance
LLC, an indirect wholly-owned Subsidiary of the Domestic Borrower, due June 2012
in an aggregate principal amount of $75,000,000 issued and sold pursuant to the
Senior Notes Documents.

“Senior Notes Documents” means the note purchase agreement, the Senior Notes and
all other agreements, instruments and other documents pursuant to which the
Senior Notes have been issued or otherwise setting forth the terms of the Senior
Notes from time to time.

“Subsidiary” of a Person means a corporation, partnership, joint venture,
limited liability company or other business entity of which a majority of the
shares of securities or other interests having ordinary voting power for the
election of directors or other governing body (other than securities or
interests having such power only by reason of the happening of a contingency)
are at the time beneficially owned, or the management of which is otherwise
controlled, directly, or indirectly through one or more intermediaries, or both,
by such Person.  Unless otherwise specified, all references herein to a
“Subsidiary” or to “Subsidiaries” shall refer to a Subsidiary or Subsidiaries of
the Domestic Borrower.

“Swap Contract” means (a) any and all rate swap transactions, basis swaps,
credit derivative transactions, forward rate transactions, commodity swaps,
commodity options,

25

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

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

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

“Synthetic Debt” means, with respect to any Person as of any date of
determination thereof, all obligations of such Person in respect of transactions
entered into by such Person that are intended to function primarily as a
borrowing of funds but are not otherwise included in the definition of
“Indebtedness” or as a liability on the consolidated balance sheet of such
Person and its Subsidiaries in accordance with GAAP.

“Synthetic Lease Obligation” means the monetary obligation of a Person under (a)
a so-called synthetic, off-balance sheet or Tax retention lease, or (b) an
agreement for the use or possession of property (including sale and leaseback
transactions), in each case, creating obligations that do not appear on the
balance sheet of such Person but which, upon the application of any Debtor
Relief Laws to such Person, would be characterized as the indebtedness of such
Person (without regard to accounting treatment).

“Taxes” means all present or future taxes, levies, imposts, duties, deductions,
withholdings, assessments, fees or other charges imposed by any Governmental
Authority, including any interest, additions to tax or penalties applicable
thereto or resulting from the non-payment thereof.

“Threshold Amount” means $20,000,000.

“Total Adjusted Leverage Ratio” means, as of any date of determination, the
ratio of (a) the sum of (i) Consolidated Funded Indebtedness as of such date and
(ii) eight (8)

26

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

times the real property rental expense of the Domestic Borrower and its
Subsidiaries for the most recently completed period of four fiscal quarters to
(b) EBITDAR of the Domestic Borrower and its Subsidiaries on a consolidated
basis for the most recently completed period of four fiscal quarters of the
Domestic Borrower.

“Total Outstandings” means the aggregate Outstanding Amount of all Loans and all
L/C Obligations.

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

“UCC” means the Uniform Commercial Code as in effect in the State of California;
provided that, if perfection or the effect of perfection or non-perfection or
the priority of any security interest in any Collateral is governed by the
Uniform Commercial Code as in effect in a jurisdiction other than the State of
California, “UCC” means the Uniform Commercial Code as in effect from time to
time in such other jurisdiction for purposes of the provisions hereof relating
to such perfection, effect of perfection or non-perfection or priority.

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

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

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

“U.S. Loan Party” means any Loan Party that is organized under the laws of one
of the states of the United States of America and that is not a Foreign
Subsidiary.

1.02        Other Interpretive Provisions.  With reference to this Agreement and
each other Loan Document, unless otherwise specified herein or in such other
Loan Document:

(a)           The definitions of terms herein shall apply equally to the
singular and plural forms of the terms defined.  Whenever the context may
require, any pronoun shall include the corresponding masculine, feminine and
neuter forms.  The words “include,” “includes” and “including” shall be deemed
to be followed by the phrase “without limitation.”  The word “will” shall be
construed to have the same meaning and effect as the word “shall.”  Unless the
context requires otherwise, (i) any definition of or reference to any agreement,
instrument or other document (including any Organization Document) shall be
construed as referring to such agreement, instrument or other document as from
time to time amended, supplemented or otherwise modified (subject to any
restrictions on such amendments, supplements or modifications set forth herein
or in any other Loan Document), (ii) any reference herein to any Person shall be
construed to include such Person’s successors and assigns, (iii) the words
“herein,” “hereof” and “hereunder,” and words of similar import when used in any
Loan Document, shall be construed to refer to such Loan Document in its entirety
and not to any particular provision thereof, (iv) all references in a Loan
Document to Articles, Sections,

27

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

Preliminary Statements, Exhibits and Schedules shall be construed to refer to
Articles and Sections of, and Preliminary Statements, Exhibits and Schedules to,
the Loan Document in which such references appear, (v) any reference to any law
shall include all statutory and regulatory provisions consolidating, amending,
replacing or interpreting such law and any reference to any law or regulation
shall, unless otherwise specified, refer to such law or regulation as amended,
modified or supplemented from time to time, and (vi) the words “asset” and
“property” shall be construed to have the same meaning and effect and to refer
to any and all tangible and intangible assets and properties, including cash,
securities, accounts and contract rights.

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

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

1.03        Accounting Terms.  (a) Generally.  All accounting terms not
specifically or completely defined herein shall be construed in conformity with,
and all financial data (including financial ratios and other financial
calculations) required to be submitted pursuant to this Agreement shall be
prepared in conformity with, GAAP applied on a consistent basis, as in effect
from time to time, applied in a manner consistent with that used in preparing
the Audited Financial Statements, except as otherwise specifically prescribed
herein.

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

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

1.05        Times of Day.  Unless otherwise specified, all references herein to
times of day shall be references to Pacific time (daylight or standard, as
applicable), except where such references pertain to Canadian Loans or Canadian
Letters of Credit, in which case such references shall be to Eastern time
(daylight or standard, as applicable).

28

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

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

1.07        Currency Equivalents Generally.  Any amount specified in this
Agreement (other than in Articles IX and X) or any of the other Loan Documents
to be in Dollars shall also include the equivalent of such amount in any
currency other than Dollars (including, without limitation, Canadian Dollars),
such equivalent amount thereof in the applicable currency to be determined by an
Administrative Agent at such time on the basis of the Spot Rate (as defined
below) for the purchase of such currency with Dollars.  For purposes of this
Section 1.07, the “Spot Rate” for a currency means the rate determined by an
Administrative Agent to be the rate quoted by the Person acting in such capacity
as the spot rate for the purchase by such Person of such currency with another
currency through its principal foreign exchange trading office at approximately
11:00 a.m. on the date two Business Days prior to the date of such
determination; provided that such Administrative Agent may obtain such spot rate
from another financial institution designated by such Administrative Agent if
the Person acting in such capacity does not have as of the date of determination
a spot buying rate for any such currency.

ARTICLE II
THE COMMITMENTS AND CREDIT EXTENSIONS

2.01        Committed Loans.

(a)           Subject to the terms and conditions set forth herein, each
Domestic Lender severally agrees to make loans (each such loan, a “Committed
Domestic Loan”) to the Domestic Borrower from time to time, on any Business Day
during the Availability Period, in an aggregate amount not to exceed at any time
outstanding the amount of such Domestic Lender’s Commitment with respect to
Domestic Loans and Domestic Letters of Credit; provided, however, that after
giving effect to any Committed Borrowing, (i) the Total Outstandings with
respect to Domestic Loans and Domestic Letters of Credit shall not exceed the
Aggregate Domestic Commitments minus the amount allocated to the Hong Kong
Subfacility at such time, and (ii) the aggregate Outstanding Amount of the
Committed Domestic Loans of any Domestic Lender, plus such Domestic Lender’s
Applicable Percentage of the Outstanding Amount of all L/C Obligations with
respect to Domestic Letters of Credit shall not exceed such Lender’s Commitment
with respect to Domestic Loans and Domestic Letters of Credit.  Within the
limits of each Domestic Lender’s Commitment, and subject to the other terms and
conditions hereof, the Domestic Borrower may borrow under this Section 2.01(a),
prepay under Section 2.04, and reborrow under this Section 2.01(a).  Committed
Domestic Loans may be Base Rate Loans or Eurodollar Rate Loans, as further
provided herein.  Committed Domestic Loans shall be funded and repaid in
Dollars.

(b)           Subject to the terms and conditions set forth herein, each
Canadian Lender severally agrees to make loans in Canadian Dollars (each such
loan, a “Committed Canadian

29

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

Loan”) to the Canadian Borrower from time to time, on any Business Day during
the Availability Period, in an aggregate amount not to exceed at any time
outstanding the amount of such Canadian Lender’s Commitment with respect to
Canadian Loans and Canadian Letters of Credit; provided, however, that after
giving effect to any Committed Borrowing, (i) the Total Outstandings with
respect to Canadian Loans and Canadian Letters of Credit shall not exceed the
Aggregate Canadian Commitments, and (ii) the aggregate Outstanding Amount of the
Committed Canadian Loans of any Canadian Lender, plus such Canadian Lender’s
Applicable Percentage of the Outstanding Amount of all L/C Obligations with
respect to Canadian Letters of Credit shall not exceed such Lender’s Commitment
with respect to Canadian Loans and Canadian Letters of Credit.  Within the
limits of each Canadian Lender’s Commitment, and subject to the other terms and
conditions hereof, the Canadian Borrower may borrow under this Section 2.01(b),
prepay Committed Canadian Loans under Section 2.04 and reborrow Committed
Canadian Loans under this Section 2.01(b).  Committed Canadian Loans may be Base
Rate Loans or Eurodollar Rate Loans, as further provided herein.  Committed
Canadian Loans shall be funded and repaid in Canadian Dollars.

(c)           If the Dollar Equivalent of the sum of Outstanding Amounts of
Canadian Loans and L/C Obligations in respect of Canadian Letters of Credit for
any reason shall exceed 100% of the Aggregate Canadian Commitments, the Canadian
Borrower shall within 10 Business Days after notice from the Canadian
Administrative Agent of such excess repay Canadian Loans by the amount of such
excess.  Amounts repaid in accordance with this Section 2.01(c) may be
reborrowed in accordance with the terms and conditions of this Agreement.

2.02        Committed Borrowings, Conversions and Continuations of Committed
Loans.

(a)           The Domestic Borrower may request Committed Domestic Loans by
notice to the Domestic Administrative Agent, and the Canadian Borrower may
request Committed Canadian Loans by notice to the Canadian Administrative Agent,
all as provided below.  Each Committed Borrowing, each conversion of Committed
Loans from one Type to the other, and each continuation of Committed Loans as
the same Type shall be made upon the applicable Borrower’s irrevocable notice to
the applicable Administrative Agent, which may be given by telephone.  Each such
notice from the Domestic Borrower must be received by the Domestic
Administrative Agent not later than 10:00 a.m. (i) three Business Days prior to
the requested date of any Committed Borrowing of, conversion to or continuation
of Eurodollar Rate Committed Loans or of any conversion of Eurodollar Rate
Committed Loans to Base Rate Committed Loans, and (ii) on the requested date of
any Committed Borrowing of Base Rate Committed Loans.  Each such notice from the
Canadian Borrower must be received by the Canadian Administrative Agent not
later than (i) 1:00 p.m. three Business Days prior to the requested date of any
Committed Borrowing of, conversion to or continuation of Eurodollar Rate
Committed Loans or of any conversion of Eurodollar Rate Committed Loans to Base
Rate Committed Loans, and (ii) 10:00 a.m. on the requested date of any Committed
Borrowing of Base Rate Committed Loans.  Each such telephonic notice must be
confirmed promptly by delivery to the applicable Administrative Agent of a
written Committed Loan Notice, appropriately completed and signed by a
Responsible Officer of the applicable Borrower.  Each Committed Borrowing of,
conversion to or continuation of Eurodollar Rate Committed Loans shall be in a
principal amount of $1,000,000 (or Cdn. $1,000,000) or a whole multiple of

30

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

$100,000 (or Cdn. $100,000) in excess thereof.  Each Committed Borrowing of or
conversion to Base Rate Committed Loans shall be in a principal amount of
$500,000 (or Cdn. $500,000) or a whole multiple of $100,000 (or Cdn. $100,000)
in excess thereof.  Each Committed Loan Notice (whether telephonic or written)
shall specify (i) whether the applicable Borrower is requesting a Committed
Borrowing, a conversion of Committed Loans from one Type to the other, or a
continuation of Eurodollar Rate Committed Loans, (ii) the requested date of the
Committed Borrowing, conversion or continuation, as the case may be (which shall
be a Business Day), (iii) the principal amount of Committed Loans to be
borrowed, converted or continued, (iv) the Type of Committed Loans to be
borrowed or to which existing Committed Loans are to be converted, and (v) if
applicable, the duration of the Interest Period with respect thereto.  If the
applicable Borrower fails to specify a Type of Committed Loan in a Committed
Loan Notice or if such Borrower fails to give a timely notice requesting a
conversion or continuation, then the applicable Committed Loans shall be made
as, or converted to, Base Rate Loans.  Any such automatic conversion to Base
Rate Loans shall be effective as of the last day of the Interest Period then in
effect with respect to the applicable Eurodollar Rate Committed Loans.  If the
applicable Borrower requests a Committed Borrowing of, conversion to, or
continuation of Eurodollar Rate Committed Loans in any such Committed Loan
Notice, but fails to specify an Interest Period, it will be deemed to have
specified an Interest Period of one month.

(b)           Following receipt of a Committed Loan Notice, the applicable
Administrative Agent shall promptly notify each applicable Lender of its
Applicable Percentage of the applicable Committed Loans, and if no timely notice
of a conversion or continuation is provided by the applicable Borrower, such
Administrative Agent shall notify each such Lender of the details of any
automatic conversion to Base Rate Loans described in the preceding subsection. 
In the case of a Committed Borrowing, each applicable Lender shall make the
amount of its Committed Loan available to the applicable Administrative Agent in
immediately available funds at the applicable Administrative Agent’s Office not
later than 11:00 a.m. in the case of Domestic Loans and Canadian Eurodollar Rate
Committed Loans and 1:00 p.m. in the case of Canadian Base Rate Committed Loans
on the Business Day specified in the applicable Committed Loan Notice.  Upon
satisfaction of the applicable conditions set forth in Section 4.02 (and, if
such Committed Borrowing is the initial Credit Extension, Section 4.01), the
applicable Administrative Agent shall make all funds so received available to
the applicable Borrower in like funds as received by such Administrative Agent
by crediting the account of such Borrower on the books of Bank of America or
Bank of America Canada (as applicable) with the amount of such funds or
otherwise disbursing such funds in accordance with the applicable Borrower’s
written instructions; provided, however, that if, on the date of a Committed
Borrowing there are L/C Borrowings by such Borrower outstanding, then the
proceeds of such Committed Borrowing shall be applied, first, to the payment in
full of any such L/C Borrowings, and second, to such Borrower as provided above.

(c)           Except as otherwise provided herein, a Eurodollar Rate Committed
Loan may be continued or converted only on the last day of an Interest Period
for such Eurodollar Rate Committed Loan.  During the existence of a Default, no
Loans may be requested as, converted to or continued as Eurodollar Rate
Committed Loans without the consent of the Required Lenders.

(d)           The applicable Administrative Agent shall promptly notify the
applicable Borrower and the applicable Lenders of the interest rate applicable
to any Interest Period for

31

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

Eurodollar Rate Committed Loans upon determination of such interest rate.  The
determination of the Eurodollar Rate by such Administrative Agent shall be
conclusive in the absence of manifest error.  The applicable Administrative
Agent shall notify the applicable Borrower and the applicable Lenders of any
change in the prime rate of Bank of America or Bank of America Canada (as
applicable) used in determining the Base Rate promptly following the public
announcement of such change if any Base Rate Loans are then outstanding.

(e)           After giving effect to all Committed Borrowings, all conversions
of Committed Loans from one Type to the other, and all continuations of
Committed Loans as the same Type, there shall not be more than ten (10) Interest
Periods in effect with respect to Domestic Loans and not more than ten (10)
Interest Periods in effect with respect to Canadian Loans.

2.03        Letters of Credit.

(a)           The Letter of Credit Commitment.  (i) The Domestic Borrower may
request Domestic Letters of Credit by notice to the Domestic L/C Issuer and the
Domestic Administrative Agent, and the Canadian Borrower may request Canadian
Letters of Credit upon notice to the Canadian L/C Issuer and the Canadian
Administrative Agent, all as provided below.  Subject to the terms and
conditions set forth herein, (A) the applicable L/C Issuer agrees, in reliance
upon the agreements of the other applicable Lenders set forth in this
Section 2.03, (1) from time to time on any Business Day during the period from
the Closing Date until the Maturity Date, to issue Letters of Credit for the
account of the applicable Borrower, and to amend Letters of Credit previously
issued by it, in accordance with subsection (b) below, and (2) to honor drafts
under the Letters of Credit as required under applicable law; and (B) such
Lenders severally agree to participate in Letters of Credit issued for the
account of such Borrower; provided that the Domestic L/C Issuer shall not be
obligated to make any L/C Credit Extension with respect to any Domestic Letter
of Credit, and no Domestic Lender shall be obligated to participate in, any
Domestic Letter of Credit if as of the date of such L/C Credit Extension, (x)
the Total Outstandings with respect to Domestic Loans and Domestic Letters of
Credit would exceed the Aggregate Domestic Commitments, (y) the aggregate
Outstanding Amount of the Committed Domestic Loans of any Domestic Lender, plus
such Lender’s Applicable Percentage of the Outstanding Amount of all Domestic
L/C Obligations would exceed such Lender’s Commitment with respect to Domestic
Loans and Domestic Letters of Credit, or (z) the Outstanding Amount of the
Domestic L/C Obligations would exceed the Letter of Credit Sublimit; provided,
further, the Canadian L/C Issuer shall not be obligated to make any L/C Credit
Extension with respect to any Canadian Letter of Credit, and no Canadian Lender
shall be obligated to participate in any Canadian Letter of Credit if as of the
date of such L/C Credit Extension (x) the Total Outstandings with respect to
Canadian Loans and Canadian Letters of Credit would exceed the Aggregate
Canadian Commitments, (y) the aggregate Outstanding Amount of the Committed
Canadian Loans of any Canadian Lender, plus such Canadian Lender’s Applicable
Percentage of the Outstanding Amount of all Canadian L/C Obligations would
exceed such Lender’s Commitment with respect to Canadian Loans and Canadian
Letters of Credit or (z) the Outstanding Amount of Canadian L/C Obligations
would exceed the Letter of Credit Sublimit.  Each request by a Borrower for the
issuance or amendment of a Letter of Credit shall be deemed to be a
representation by such Borrower that the L/C Credit Extension so requested
complies with the conditions set forth in clauses (x) and (z) of the

32

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

applicable proviso to the preceding sentence.  Within the foregoing limits, and
subject to the terms and conditions hereof, the Borrowers’ ability to obtain
Letters of Credit shall be fully revolving, and accordingly the Borrowers may,
during the foregoing period, obtain Letters of Credit to replace Letters of
Credit that have expired or that have been drawn upon and reimbursed.

(ii)           An L/C Issuer shall not issue any Letter of Credit if:

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

(B)           the expiry date of such requested Letter of Credit would occur
after the Letter of Credit Expiration Date, unless all the Lenders have approved
such expiry date.

(iii)          An L/C Issuer shall not be under any obligation to issue any
Letter of Credit if:

(A)          any order, judgment or decree of any Governmental Authority or
arbitrator shall by its terms purport to enjoin or restrain such L/C Issuer from
issuing such Letter of Credit, or any Law applicable to such L/C Issuer or any
request or directive (whether or not having the force of law) from any
Governmental Authority with jurisdiction over such L/C Issuer shall prohibit, or
request that such L/C Issuer refrain from, the issuance of letters of credit
generally or such Letter of Credit in particular or shall impose upon such L/C
Issuer with respect to such Letter of Credit any restriction, reserve or capital
requirement (for which such L/C Issuer is not otherwise compensated hereunder)
not in effect on the Closing Date, or shall impose upon such L/C Issuer any
unreimbursed loss, cost or expense which was not applicable on the Closing Date
and which such L/C Issuer in good faith deems material to it;

(B)           the issuance of such Letter of Credit would violate one or more
policies of such L/C Issuer applicable to letters of credit generally;

(C)           such Letter of Credit is to be denominated in a currency other
than Dollars or an Approved Currency in the case of Domestic Letters of Credit
and Canadian Dollars or an Approved Currency in the case of Canadian Letters of
Credit;

(D)          such Letter of Credit contains any provisions for automatic
reinstatement of the stated amount after any drawing thereunder; or

(E)           a default of any Lender’s obligations to fund under
Section 2.03(c) exists or any Lender is at such time a Defaulting Lender
hereunder, unless such L/C Issuer has entered into satisfactory arrangements
with

33

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

the applicable Borrower or such Lender to eliminate such L/C Issuer’s risk with
respect to such Lender.

(iv)          An L/C Issuer shall not amend any Letter of Credit if such L/C
Issuer would not be permitted at such time to issue such Letter of Credit in its
amended form under the terms hereof.

(v)           An L/C Issuer shall be under no obligation to amend any Letter of
Credit if (A) such L/C Issuer would have no obligation at such time to issue
such Letter of Credit in its amended form under the terms hereof, or (B) the
beneficiary of such Letter of Credit does not accept the proposed amendment to
such Letter of Credit.

(vi)          An L/C Issuer shall act on behalf of the Domestic Lenders or
Canadian Lenders, as applicable, with respect to any Letters of Credit issued by
it and the documents associated therewith, and such L/C Issuer shall have all of
the benefits and immunities (A) provided to the Administrative Agent in
Article IX with respect to any acts taken or omissions suffered by such L/C
Issuer in connection with Letters of Credit issued by it or proposed to be
issued by it and Issuer Documents pertaining to such Letters of Credit as fully
as if the term “Administrative Agent” as used in Article IX included such L/C
Issuer with respect to such acts or omissions, and (B) as additionally provided
herein with respect to the L/C Issuer.

(b)           Procedures for Issuance and Amendment of Letters of Credit;
Auto-Extension Letters of Credit.  (i) Each Letter of Credit shall be issued or
amended, as the case may be, upon the request of the applicable Borrower
delivered to the applicable L/C Issuer (with a copy to the applicable
Administrative Agent) in the form of a Letter of Credit Application,
appropriately completed and signed by a Responsible Officer of such Borrower. 
Such L/C Application must be received by the applicable L/C Issuer and the
applicable Administrative Agent not later than 8:00 a.m. in the case of Domestic
Letters of Credit and 12:00 noon in the case of Canadian Letters of Credit at
least two Business Days (or such later date and time as such L/C Issuer may
agree in a particular instance in its sole discretion) prior to the proposed
issuance date or date of amendment, as the case may be.  In the case of a
request for an initial issuance of a Letter of Credit, such Letter of Credit
Application shall specify in form and detail satisfactory to the applicable L/C
Issuer: (A) the proposed issuance date of the requested Letter of Credit (which
shall be a Business Day); (B) the amount thereof; (C) the expiry date thereof;
(D) the name and address of the beneficiary thereof; (E) the documents to be
presented by such beneficiary in case of any drawing thereunder; (F) the full
text of any certificate to be presented by such beneficiary in case of any
drawing thereunder; and (G) such other matters as such L/C Issuer may require. 
In the case of a request for an amendment of any outstanding Letter of Credit,
such Letter of Credit Application shall specify in form and detail satisfactory
to the applicable L/C Issuer (A) the Letter of Credit to be amended; (B) the
proposed date of amendment thereof (which shall be a Business Day); (C) the
nature of the proposed amendment; and (D) such other matters as such L/C Issuer
may require.  Additionally, the applicable Borrower shall furnish to the
applicable L/C Issuer and the applicable Administrative Agent such other
documents and information pertaining to such requested Letter of Credit issuance
or amendment, including any Issuer Documents, as such L/C Issuer or such
Administrative Agent may require.

34

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

(ii)           Promptly after receipt of any Letter of Credit Application, the
applicable L/C Issuer will confirm with such Administrative Agent (by telephone
or in writing) that such Administrative Agent has received a copy of such Letter
of Credit Application from the applicable Borrower and, if not, such L/C Issuer
will provide such Administrative Agent with a copy thereof.  Unless the
applicable L/C Issuer has received written notice from any Lender, an
Administrative Agent or any Loan Party, at least one Business Day prior to the
requested date of issuance or amendment of the applicable Letter of Credit, that
one or more applicable conditions contained in Article IV shall not then be
satisfied, then, subject to the terms and conditions hereof, such L/C Issuer
shall, on the requested date, issue a Letter of Credit for the account of the
applicable Borrower or enter into the applicable amendment, as the case may be,
in each case in accordance with such L/C Issuer’s usual and customary business
practices.  Immediately upon the issuance of each Domestic Letter of Credit,
each Domestic Lender shall be deemed to, and hereby irrevocably and
unconditionally agrees to, purchase from the Domestic L/C Issuer a risk
participation in such Domestic Letter of Credit in an amount equal to the
product of such Domestic Lender’s Applicable Percentage times the amount of such
Domestic Letter of Credit.  Immediately upon the issuance of each Canadian
Letter of Credit, each Canadian Lender shall be deemed to, and hereby
irrevocably and unconditionally agrees to, purchase from the Canadian L/C Issuer
a risk participation in such Canadian Letter of Credit in an amount equal to the
product of such Canadian Lender’s Applicable Percentage times the amount of such
Canadian Letter of Credit.

(iii)          If a Borrower so requests in any applicable Letter of Credit
Application, the applicable L/C Issuer may, in its sole and absolute discretion,
agree to issue a Letter of Credit that has automatic extension provisions (each,
an “Auto-Extension Letter of Credit”); provided that any such Auto-Extension
Letter of Credit must permit such L/C Issuer to prevent any such extension at
least once in each twelve-month period (commencing with the date of issuance of
such Letter of Credit) by giving prior notice to the beneficiary thereof not
later than a day (the “Non-Extension Notice Date”) in each such twelve-month
period to be agreed upon at the time such Letter of Credit is issued.  Unless
otherwise directed by the applicable L/C Issuer, the applicable Borrower shall
not be required to make a specific request to such L/C Issuer for any such
extension.  Once an Auto-Extension Letter of Credit has been issued, the Lenders
shall be deemed to have authorized (but may not require) the applicable L/C
Issuer to permit the extension of such Letter of Credit at any time to an expiry
date not later than the Letter of Credit Expiration Date; provided, however,
that such L/C Issuer shall not permit any such extension if (A) such L/C Issuer
has determined that it would not be permitted, or would have no obligation at
such time to issue such Letter of Credit in its revised form (as extended) under
the terms hereof (by reason of the provisions of clause (ii) or (iii) of
Section 2.03(a) or otherwise), or (B) it has received notice (which may be by
telephone or in writing) on or before the day that is five Business Days before
the Non-Extension Notice Date (1) from the applicable Administrative Agent that
the Required Lenders have elected not to permit such extension or (2) from the
applicable Administrative Agent, any applicable Lender or the applicable
Borrower that one or more of the applicable conditions specified in Section 4.02
is not then satisfied, and in each such case directing such L/C Issuer not to
permit such extension.

35

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

(iv)          Promptly after its delivery of any Letter of Credit or any
amendment to a Letter of Credit to an advising bank with respect thereto or to
the beneficiary thereof, the applicable L/C Issuer will also deliver to the
applicable Borrower and the applicable Administrative Agent a true and complete
copy of such Letter of Credit or amendment.

(c)           Drawings and Reimbursements; Funding of Participations.  (i) Upon
receipt from the beneficiary of any Letter of Credit of any notice of a drawing
under such Letter of Credit, the applicable L/C Issuer shall notify the
applicable Borrower and the applicable Administrative Agent thereof.  Not later
than 11:00 a.m. on the date of any payment by the applicable L/C Issuer under a
Letter of Credit (each such date, an “Honor Date”), the applicable Borrower
shall reimburse the applicable L/C Issuer through the applicable Administrative
Agent in an amount equal to the amount of such drawing.  If such Borrower fails
to so reimburse such L/C Issuer by such time, such Administrative Agent shall
promptly notify each applicable Lender of the Honor Date, the amount of the
unreimbursed drawing (the “Unreimbursed Amount”), and the amount of such
Lender’s Applicable Percentage thereof.  In such event, such Borrower shall be
deemed to have requested a Committed Borrowing of Base Rate Loans to be
disbursed on the Honor Date in an amount equal to the Unreimbursed Amount,
without regard to the minimum and multiples specified in Section 2.02 for the
principal amount of Base Rate Loans, but subject to the amount of the unutilized
portion of the Aggregate Domestic Commitments or the Aggregate Canadian
Commitments as applicable and the conditions set forth in Section 4.02 (other
than the delivery of a Committed Loan Notice).  Any notice given by an L/C
Issuer or an Administrative Agent pursuant to this Section 2.03(c)(i) may be
given by telephone if immediately confirmed in writing; provided that the lack
of such an immediate confirmation shall not affect the conclusiveness or binding
effect of such notice.

(ii)           Each applicable Lender shall upon any notice pursuant to
Section 2.03(c)(i) make funds available to the applicable Administrative Agent
for the account of the applicable L/C Issuer at such Administrative Agent’s
Office in an amount equal to its Applicable Percentage of the Unreimbursed
Amount not later than 1:00 p.m. on the Business Day specified in such notice by
such Administrative Agent, whereupon, subject to the provisions of
Section 2.03(c)(iii), each Lender that so makes funds available shall be deemed
to have made a Base Rate Loan to the applicable Borrower in such amount.  The
applicable Administrative Agent shall remit the funds so received to the
applicable L/C Issuer.

(iii)          With respect to any Unreimbursed Amount that is not fully
refinanced by a Committed Borrowing of Base Rate Loans because the conditions
set forth in Section 4.02 cannot be satisfied or for any other reason, the
applicable Borrower shall be deemed to have incurred from the applicable L/C
Issuer an L/C Borrowing in the amount of the Unreimbursed Amount that is not so
refinanced, which L/C Borrowing shall be due and payable on demand (together
with interest) and shall bear interest at the Default Rate.  In such event, each
Lender’s payment to the applicable Administrative Agent for the account of such
L/C Issuer pursuant to Section 2.03(c)(ii) shall be deemed payment in respect of
its participation in such L/C Borrowing and shall constitute an L/C Advance from
such Lender in satisfaction of its participation obligation under this
Section 2.03.

36

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

(iv)          Until each Lender funds its Committed Loan or L/C Advance pursuant
to this Section 2.03(c) to reimburse the applicable L/C Issuer for any amount
drawn under any Letter of Credit, interest in respect of such Lender’s
Applicable Percentage of such amount shall be solely for the account of such L/C
Issuer.

(v)           Each Lender’s obligation to make Committed Loans or L/C Advances
to reimburse an L/C Issuer for amounts drawn under Letters of Credit, as
contemplated by this Section 2.03(c), shall be absolute and unconditional and
shall not be affected by any circumstance, including (A) any setoff,
counterclaim, recoupment, defense or other right which such Lender may have
against such L/C Issuer, the Borrowers or any other Person for any reason
whatsoever; (B) the occurrence or continuance of a Default, or (C) any other
occurrence, event or condition, whether or not similar to any of the foregoing;
provided, however, that each Lender’s obligation to make Committed Loans
pursuant to this Section 2.03(c) is subject to the conditions set forth in
Section 4.02 (other than delivery by a Borrower of a Committed Loan Notice).  No
such making of an L/C Advance shall relieve or otherwise impair the obligation
of a Borrower to reimburse the applicable L/C Issuer for the amount of any
payment made by such L/C Issuer under any Letter of Credit, together with
interest as provided herein.

(vi)          If any Lender fails to make available to the applicable
Administrative Agent for the account of the applicable L/C Issuer any amount
required to be paid by such Lender pursuant to the foregoing provisions of this
Section 2.03(c) by the time specified in Section 2.03(c)(ii), such L/C Issuer
shall be entitled to recover from such Lender (acting through such
Administrative Agent), on demand, such amount with interest thereon for the
period from the date such payment is required to the date on which such payment
is immediately available to such L/C Issuer at a rate per annum equal to the
greater of the Federal Funds Rate (in the case of the Domestic L/C Issuer) or
the Interbank Reference Rate (in the case of the Canadian L/C Issuer) and a rate
determined by such L/C Issuer in accordance with banking industry rules on
interbank compensation, plus any administrative, processing or similar fees
customarily charged by such L/C Issuer in connection with the foregoing.  If
such Lender pays such amount (with interest and fees as aforesaid), the amount
so paid shall constitute such Lender’s Committed Loan included in the relevant
Committed Borrowing or L/C Advance in respect of the relevant L/C Borrowing, as
the case may be.  A certificate of the applicable L/C Issuer submitted to any
Lender (through the applicable Administrative Agent) with respect to any amounts
owing under this Section 2.03(c)(vi) shall be conclusive absent manifest error.

(d)           Repayment of Participations.  (i) At any time after an L/C Issuer
has made a payment under any Letter of Credit and has received from any Lender
such Lender’s L/C Advance in respect of such payment in accordance with
Section 2.03(c), if the applicable Administrative Agent receives for the account
of such L/C Issuer any payment in respect of the related Unreimbursed Amount or
interest thereon (whether directly from the applicable Borrower or otherwise,
including proceeds of Cash Collateral applied thereto by such Administrative
Agent), such Administrative Agent will distribute to such Lender its Applicable
Percentage thereof in the same funds as those received by such Administrative
Agent.

37

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

(ii)           If any payment received by an Administrative Agent for the
account of an L/C Issuer pursuant to Section 2.03(c)(i) is required to be
returned under any of the circumstances described in Section 10.05 (including
pursuant to any settlement entered into by such L/C Issuer in its discretion),
each applicable Lender shall pay to the applicable Administrative Agent for the
account of such L/C Issuer its Applicable Percentage thereof on demand of such
Administrative Agent, plus interest thereon from the date of such demand to the
date such amount is returned by such Lender, at a rate per annum equal to the
Federal Funds Rate (in the case of the Domestic L/C Issuer) or the Interbank
Reference Rate (in the case of the Canadian L/C Issuer) from time to time in
effect.  The obligations of the Lenders under this clause shall survive the
payment in full of the Obligations and the termination of this Agreement.

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

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

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

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

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

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

38

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

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

(f)            Role of L/C Issuers.  Each Lender and the Borrowers agree that,
in paying any drawing under a Letter of Credit, the L/C Issuers shall not have
any responsibility to obtain any document (other than any sight draft,
certificates and documents expressly required by the Letter of Credit) or to
ascertain or inquire as to the validity or accuracy of any such document or the
authority of the Person executing or delivering any such document.  None of the
L/C Issuers, the Administrative Agents, any of their respective Related Parties
nor any correspondent, participant or assignee of the L/C Issuers shall be
liable to any Lender for (i) any action taken or omitted in connection herewith
at the request or with the approval of the Lenders or the Required Lenders, as
applicable; (ii) any action taken or omitted in the absence of gross negligence
or willful misconduct; or (iii) the due execution, effectiveness, validity or
enforceability of any document or instrument related to any Letter of Credit or
Issuer Document.  Each Borrower hereby assumes all risks of the acts or
omissions of any beneficiary or transferee with respect to its use of any Letter
of Credit; provided, however, that this assumption is not intended to, and shall
not, preclude such Borrower’s pursuing such rights and remedies as it may have
against the beneficiary or transferee at law or under any other agreement.  None
of the L/C Issuers, the Administrative Agents, any of their respective Related
Parties nor any correspondent, participant or assignee of the L/C Issuers shall
be liable or responsible for any of the matters described in clauses (i) through
(v) of Section 2.03(e); provided, however, that anything in such clauses to the
contrary notwithstanding, a Borrower may have a claim against an L/C Issuer, and
such L/C Issuer may be liable to a Borrower, to the extent, but only to the
extent, of any direct, as opposed to consequential or exemplary, damages
suffered by such Borrower which such Borrower proves were caused by such L/C
Issuer’s willful misconduct or gross negligence or such L/C Issuer’s willful
failure to pay under any Letter of Credit after the presentation to it by the
beneficiary of a sight draft and certificate(s) strictly complying with the
terms and conditions of a Letter of Credit.  In furtherance and not in
limitation of the foregoing, an L/C Issuer may accept documents that appear on
their face to be in order, without responsibility for further investigation,
regardless of any notice or information to the contrary, and such L/C Issuer
shall not be responsible for the validity or sufficiency of any instrument
transferring or assigning or purporting to transfer or assign a Letter of Credit
or the rights or benefits thereunder or proceeds thereof, in whole or in part,
which may prove to be invalid or ineffective for any reason.

(g)           Cash Collateral.  Upon the request of the applicable
Administrative Agent, (i) if an L/C Issuer has honored any full or partial
drawing request under any Letter of Credit and such drawing has resulted in an
L/C Borrowing, or (ii) if, as of the Letter of Credit Expiration Date, any L/C
Obligation for any reason remains outstanding, the applicable Borrower shall, in
each case, immediately Cash Collateralize the then Outstanding Amount of all L/C
Obligations.  Sections 2.04 and 8.02(c) set forth certain additional
requirements to deliver Cash Collateral hereunder.  For purposes of this
Section 2.03, Section 2.04 and Section 8.02(c), “Cash Collateralize” means to
pledge and deposit with or deliver to the applicable Administrative Agent, for
the benefit of the applicable L/C Issuer and the applicable Lenders, as
collateral for the L/C Obligations, cash or deposit account balances pursuant to
documentation in form and

39

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

substance satisfactory to such Administrative Agent and such L/C Issuer (which
documents are hereby consented to by the Lenders).  Derivatives of such term
have corresponding meanings.  Each Borrower hereby grants to the applicable
Administrative Agent, for the benefit of the applicable L/C Issuer and the
Lenders, a security interest in all such cash, deposit accounts and all balances
therein and all proceeds of the foregoing.  Cash Collateral shall be maintained
in blocked, non-interest bearing deposit accounts at Bank of America or Bank of
America Canada, as applicable.  If at any time an Administrative Agent
determines that any funds held as Cash Collateral are subject to any right or
claim of any Person other than such Administrative Agent or that the total
amount of such funds is less than the aggregate Outstanding Amount of all
applicable L/C Obligations, the applicable Borrower will, forthwith upon demand
by the applicable Administrative Agent, pay to such Administrative Agent, as
additional funds to be deposited as Cash Collateral, an amount equal to the
excess of (x) such aggregate Outstanding Amount over (y) the total amount of
funds, if any, then held as Cash Collateral that such Administrative Agent
determines to be free and clear of any such right and claim.  Upon the drawing
of any Letter of Credit for which funds are on deposit as Cash Collateral, such
funds shall be applied, to the extent permitted under applicable Laws, to
reimburse the applicable L/C Issuer.

(h)           Applicability of ISP and UCP.  Unless otherwise expressly agreed
by the applicable L/C Issuer and Borrower when a Letter of Credit is issued, (i)
the rules of the ISP shall apply to each standby Letter of Credit, and (ii) the
rules of the Uniform Customs and Practice for Documentary Credits, as most
recently published by the International Chamber of Commerce at the time of
issuance shall apply to each commercial Letter of Credit.

(i)            Letter of Credit Fees.  Each Borrower shall pay to the applicable
Administrative Agent for the account of each applicable Lender in accordance
with its Applicable Percentage a Letter of Credit fee (the “Letter of Credit
Fee”) (i) for each commercial Letter of Credit issued for such Borrower’s
account at such rates as may be mutually agreed by such Borrower and L/C Issuer
and (ii) for each standby Letter of Credit issued for such Borrower’s account
equal to the Applicable Rate for Eurodollar Rate Loans times the daily amount
available to be drawn under such Letter of Credit.  For purposes of computing
the daily amount available to be drawn under any Letter of Credit, the amount of
such Letter of Credit shall be determined in accordance with Section 1.06. 
Letter of Credit Fees shall be (i) due and payable on the last Business Day of
each March, June, September and December, commencing with the first such date to
occur after the issuance of such Letter of Credit, on the Letter of Credit
Expiration Date and thereafter on demand and (ii) computed on a quarterly basis
in arrears.  If there is any change in the Applicable Rate during any quarter,
the daily amount available to be drawn under each Letter of Credit shall be
computed and multiplied by the Applicable Rate separately for each period during
such quarter that such Applicable Rate was in effect.  Notwithstanding anything
to the contrary contained herein, upon the request of the Required Lenders,
while any Event of Default exists, all Letter of Credit Fees shall accrue at the
Default Rate.

(j)            Fronting Fee and Documentary and Processing Charges Payable to
L/C Issuer.  Each Borrower shall pay directly to the applicable L/C Issuer for
its own account a fronting fee (i) with respect to each commercial Letter of
Credit issued for such Borrower’s account, at such rates as may be mutually
agreed by such Borrower and L/C Issuer, (ii) with

40

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

respect to any amendment of a commercial Letter of Credit increasing the amount
of such Letter of Credit, at a rate separately agreed between such Borrower and
the L/C Issuer, computed on the amount of such increase, and payable upon the
effectiveness of such amendment, and (iii) with respect to each standby Letter
of Credit, at such rates as may be mutually agreed by such Borrower and L/C
Issuer; provided that no fronting fee shall be charged with respect to any
period when there is only one Lender under this Agreement.  Such fronting fee
pursuant to clauses (i) and (iii) above shall be due and payable on the last
Business Day of each March, June, September and December in respect of the most
recently-ended quarterly period (or portion thereof, in the case of the first
payment), commencing with the first such date to occur after the issuance of
such Letter of Credit, on the Letter of Credit Expiration Date and thereafter on
demand.  For purposes of computing the daily amount available to be drawn under
any Letter of Credit, the amount of such Letter of Credit shall be determined in
accordance with Section 1.06.  In addition, such Borrower shall pay directly to
the applicable L/C Issuer for its own account the customary issuance,
presentation, amendment and other processing fees, and other standard costs and
charges, of such L/C Issuer relating to letters of credit as from time to time
in effect.  Such customary fees and standard costs and charges are due and
payable on demand and are nonrefundable.

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

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

2.04        Prepayments.  (a) Each Borrower may, upon notice to the applicable
Administrative Agent, at any time or from time to time voluntarily prepay
Committed Loans in whole or in part without premium or penalty; provided that
(i) such notice must be received by such Administrative Agent not later than
10:00 a.m. (A) three Business Days prior to any date of prepayment of Eurodollar
Rate Committed Loans, and (B) on the date of prepayment of Base Rate Committed
Loans; (ii) any prepayment of Eurodollar Rate Committed Loans shall be in a
principal amount of  $5,000,000 (or Cdn. $5,000,000) or a whole multiple of
$1,000,000 (or Cdn. $1,000,000) in excess thereof; and (iii) any prepayment of
Base Rate Committed Loans shall be in a principal amount of $500,000 (or Cdn.
$500,000) or a whole multiple of $100,000 (or Cdn. $100,000) in excess thereof. 
Each such notice shall specify the date and amount of such prepayment and the
Type(s) of Committed Loans to be prepaid.  Such Administrative Agent will
promptly notify each applicable Lender of its receipt of each such notice, and
of such Lender’s Applicable Percentage of such prepayment.  If such notice is
given by a Borrower, the Borrower shall make such prepayment and the payment
amount specified in such notice shall be due and payable on the date specified
therein.  Any prepayment of a Eurodollar Rate Loan shall be accompanied by all
accrued interest thereon, together with any additional amounts required pursuant
to Section 3.05.  Each such prepayment shall be applied to the applicable
Committed Loans of the applicable Lenders in accordance with their respective
Applicable Percentages.

41

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

(b)           If for any reason the Outstanding Amount of all Domestic Loans and
Domestic L/C Obligations at any time exceeds the Aggregate Domestic Commitments
then in effect, the Domestic Borrower shall immediately prepay Domestic Loans
and/or Cash Collateralize the Domestic L/C Obligations in an aggregate amount
equal to such excess.  If for any reason the Outstanding Amount of all Canadian
Loans and Canadian L/C Obligations at any time exceeds the Aggregate Canadian
Commitments then in effect, the Canadian Borrower shall immediately prepay
Canadian Loans and/or Cash Collateralize the Canadian L/C Obligations in an
aggregate amount equal to such excess.

2.05        Reduction or Termination of Commitments.  (a) Each Borrower may,
upon notice to the applicable Administrative Agent, terminate the Aggregate
Commitments, or permanently reduce the sum thereof to an amount not less than
the then Outstanding Amount of all Loans to, and L/C Obligations of, the
Borrowers; provided that (i) any such notice shall be received by such
Administrative Agent not later than 10:00 a.m. two Business Days prior to the
date of termination or reduction, (ii) such Borrower shall specify which
Commitment is to be so reduced, and (iii) any such partial reduction shall be in
an aggregate amount of $5,000,000 (or Cdn. $5,000,000) or any whole multiple of
$1,000,000 (or Cdn. $1,000,000) in excess thereof;

(b)           The applicable Administrative Agent shall promptly notify the
applicable Lenders of any such notice of reduction or termination of the
Aggregate Commitments.  Once reduced in accordance with this Section, the
Aggregate Commitments may not be increased.  Any such reduction shall be applied
to the Commitment of each applicable Lender according to its Applicable
Percentage.  All fees accrued on the Aggregate Domestic Commitments or Aggregate
Canadian Commitments that are terminated, until the effective date of any
termination, shall be paid on the effective date of such termination.

2.06        Repayment of Loans.  Each Borrower shall repay to the applicable
Lenders on the Maturity Date the aggregate principal amount of Committed Loans
outstanding on such date to such Borrower.

2.07        Interest.  (a) Subject to the provisions of Section 2.07(b), (i)
each Eurodollar Rate Committed Loan shall bear interest on the outstanding
principal amount thereof for each Interest Period at a rate per annum equal to
the Eurodollar Rate for such Interest Period plus the Applicable Rate; and (ii)
each Base Rate Committed Loan shall bear interest on the outstanding principal
amount thereof from the applicable borrowing date at a rate per annum equal to
the applicable Base Rate plus the Applicable Rate.

(b)           (i)            If any amount of principal of any Loan is not paid
when due (without regard to any applicable grace periods), whether at stated
maturity, by acceleration or otherwise, such amount shall thereafter, upon the
election of Required Lenders, bear interest at a fluctuating interest rate per
annum at all times equal to the Default Rate to the fullest extent permitted by
applicable Laws.

(ii)           If any amount (other than principal of any Loan) payable by
either Borrower under any Loan Document is not paid when due (without regard to
any applicable grace periods), whether at stated maturity, by acceleration or
otherwise, then upon the request of the Required Lenders such amount shall
thereafter bear interest at a

42

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

fluctuating interest rate per annum at all times equal to the Default Rate to
the fullest extent permitted by applicable Laws.

(iii)          Upon the request of the Required Lenders, while any Event of
Default exists, the Borrowers shall pay interest on the principal amount of all
outstanding Obligations hereunder at a fluctuating interest rate per annum at
all times equal to the Default Rate to the fullest extent permitted by
applicable Laws.

(iv)          Accrued and unpaid interest on past due amounts (including
interest on past due interest) shall be due and payable upon demand.

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

2.08        Fees.  In addition to certain fees described in subsections (i) and
(j) of Section 2.03:

(a)           Commitment Fee.  Each Borrower shall pay to the applicable
Administrative Agent for the account of each applicable Lender in accordance
with its Applicable Percentage, a commitment fee equal to the Applicable
Commitment Fee Percentage times the actual daily amount by which the Aggregate
Domestic Commitments or Aggregate Canadian Commitments as applicable, exceed the
sum of (i) the Outstanding Amount of Committed Loans to such Borrower and (ii)
the Outstanding Amount of L/C Obligations of such Borrower.  The commitment fee
shall be due and payable quarterly in arrears on the last Business Day of each
March, June, September and December, commencing with the first such date to
occur after the Closing Date, and on the Maturity Date.  The commitment fee
shall be calculated quarterly in arrears, and if there is any change in the
Applicable Commitment Fee Percentage during any quarter, the actual daily amount
shall be computed and multiplied by the Applicable Commitment Fee Percentage
separately for each period during such quarter that such Applicable Commitment
Fee Percentage was in effect.  The commitment fee shall accrue at all times
during the Availability Period, including at any time during which one or more
of the conditions in Article IV is not met.

(b)           Other Fees.  Each Borrower shall pay to the Administrative Agents
fees in the amounts and at the times specified in the Fee Letter.  Such fees
shall be fully earned when paid and shall not be refundable for any reason
whatsoever.  The Borrowers shall pay to the Lenders such fees as shall have been
separately agreed upon in writing in the amounts and at the times so specified. 
Such fees shall be fully earned when paid and shall not be refundable.

2.09        Computation of Interest and Fees.  All computations of interest for
Base Rate Loans when the Base Rate is determined by Bank of America’s “prime
rate” shall be made on the basis of a year of 365 or 366 days, as the case may
be, and actual days elapsed.  All other computations of fees and interest shall
be made on the basis of a 360-day year and actual days elapsed (which results in
more fees or interest, as applicable, being paid than if computed on the

43

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

basis of a 365-day year).  Interest shall accrue on each Loan for the day on
which the Loan is made, and shall not accrue on a Loan, or any portion thereof,
for the day on which the Loan or such portion is paid, provided that any Loan
that is repaid on the same day on which it is made shall, subject to
Section 2.11(a), bear interest for one day.  Each rate of interest which is
calculated with reference to a period (the “deemed interest period”) that is
less than the actual number of days in the calendar year of calculation is, for
the purposes of the Interest Act (Canada), equivalent to a rate based on a
calendar year calculated by multiplying such rate of interest by the actual
number of days in the calendar year of calculation and dividing by the number of
days in the deemed interest period.  Each determination by an Administrative
Agent of an interest rate or fee hereunder shall be conclusive and binding for
all purposes, absent manifest error.

2.10        Evidence of Debt.  (a) The Credit Extensions made by each Lender
shall be evidenced by one or more accounts or records maintained by such Lender
and by the applicable Administrative Agent in the ordinary course of business. 
The accounts or records maintained by the Administrative Agents and each Lender
shall be conclusive absent manifest error of the amount of the Credit Extensions
made by the Lenders to the Borrowers and the interest and payments thereon.  Any
failure to so record or any error in doing so shall not, however, limit or
otherwise affect the obligation of the Borrowers hereunder to pay any amount
owing with respect to the Obligations.  In the event of any conflict between the
accounts and records maintained by any Lender and the accounts and records of
the Administrative Agents in respect of such matters, the accounts and records
of the applicable Administrative Agent shall control in the absence of manifest
error.  Upon the request of any Lender made through the applicable
Administrative Agent, the applicable Borrower shall execute and deliver to such
Lender (through the applicable Administrative Agent) a Note, which shall
evidence such Lender’s Loans in addition to such accounts or records.  Each
Lender may attach schedules to its Note and endorse thereon the date, Type (if
applicable), amount and maturity of its Loans and payments with respect thereto.

(b)           In addition to the accounts and records referred to in
Section 2.10(a), each Lender and the Administrative Agents shall maintain in
accordance with their usual practice accounts or records evidencing the
purchases and sales by such Lender of participations in Letters of Credit.  In
the event of any conflict between the accounts and records maintained by the
Administrative Agents and the accounts and records of any Lender in respect of
such matters, the accounts and records of the Administrative Agents shall
control in the absence of manifest error.

2.11        Payments Generally; Administrative Agent’s Clawback.  (a) General. 
All payments to be made by the Borrowers shall be made without condition or
deduction for any counterclaim, defense, recoupment or setoff.  Except as
otherwise expressly provided herein, all payments by the Borrowers hereunder
shall be made to the applicable Administrative Agent, for the account of the
respective Lenders to which such payment is owed, at the Administrative Agent’s
Office of such Administrative Agent in Dollars or, in the case of payments
regarding Canadian Loans or Canadian Letters of Credit, in Canadian Dollars,
and, in all cases, in immediately available funds not later than 2:00 p.m. on
the date specified herein.  Such Administrative Agent will promptly distribute
to each applicable Lender its Applicable Percentage (or other applicable share
as provided herein) of such payment in like funds as received by wire transfer
to such Lender’s Lending Office.  All payments received by the

44

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

Administrative Agents after 2:00 p.m. shall be deemed received on the next
succeeding Business Day and any applicable interest or fee shall continue to
accrue.  If any payment to be made by the Borrowers shall come due on a day
other than a Business Day, payment shall be made on the next following Business
Day, and such extension of time shall be reflected on computing interest or
fees, as the case may be.

(b)           (i)            Funding by Lenders; Presumption by Administrative
Agent.  Unless an Administrative Agent shall have received notice from a Lender
prior to the proposed date of any Committed Borrowing of Eurodollar Rate Loans
(or, in the case of any Committed Borrowing of Base Rate Loans, prior to 12:00
noon on the date of such Committed Borrowing) that such Lender will not make
available to such Administrative Agent such Lender’s share of such Committed
Borrowing, such Administrative Agent may assume that such Lender has made such
share available on such date in accordance with Section 2.02 (or, in the case of
a Committed Borrowing of Base Rate Loans, that such Lender has made such share
available in accordance with and at the time required by Section 2.02) 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 Committed Borrowing available to the applicable Administrative
Agent, then the applicable Lender and Borrower severally agree to pay to such
Administrative Agent forthwith on demand such corresponding amount in
immediately available funds 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 such Administrative Agent, at (A) in the case
of a payment to be made by such Lender to the Domestic Administrative Agent, the
greater of the Federal Funds Rate and a rate determined by the Domestic
Administrative Agent in accordance with banking industry rules on interbank
compensation and in the case of a payment to be made by such Lender to the
Canadian Administrative Agent, the Interbank Reference Rate, plus in either case
any administrative, processing or similar fees customarily charged by such
Administrative Agent in connection with the foregoing, and (B) in the case of a
payment to be made by a Borrower, the interest rate applicable to Base Rate
Loans.  If a Borrower and such Lender shall pay such interest to an
Administrative Agent for the same or an overlapping period, such Administrative
Agent shall promptly remit to such Borrower the amount of such interest paid by
such Borrower for such period.  If such Lender pays its share of the applicable
Committed Borrowing to the applicable Administrative Agent, then the amount so
paid shall constitute such Lender’s Loan included in such Committed Borrowing. 
Any payment by a Borrower shall be without prejudice to any claim such Borrower
may have against a Lender that shall have failed to make such payment to the
applicable Administrative Agent.

(ii)           Payments by Borrowers; Presumptions by Administrative Agents. 
Unless an Administrative Agent shall have received notice from a Borrower prior
to the time at which any payment is due to the Administrative Agent for the
account of the Lenders or the L/C Issuer hereunder that such Borrower will not
make such payment, such Administrative Agent may assume that such Borrower has
made such payment on such date in accordance herewith and may, in reliance upon
such assumption, distribute to the Appropriate Lenders or the L/C Issuer, as the
case may be, the amount due.  In such event, if a Borrower has not in fact made
such payment, then each of the Appropriate Lenders or the L/C Issuer, as the
case may be, severally agrees to repay to such Administrative Agent forthwith on
demand the amount so distributed to such Lender

45

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

or the L/C Issuer, in immediately available funds 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 such Administrative Agent, in the case of
repayments to the Domestic Administrative Agent at the greater of the Federal
Funds Rate and a rate determined by such Administrative Agent in accordance with
banking industry rules on interbank compensation and in the case of repayments
to the Canadian Administrative Agent, at the Interbank Reference Rate.

A notice of an Administrative Agent to any Lender or Borrower with respect to
any amount owing under this subsection (b) shall be conclusive, absent manifest
error.

(c)           Failure to Satisfy Conditions Precedent.  If any Lender makes
available to an Administrative Agent funds for any Loan to be made by such
Lender as provided in the foregoing provisions of this Article II, and such
funds are not made available to the applicable Borrower by such Administrative
Agent because the conditions to the applicable Credit Extension set forth in
Article IV are not satisfied or waived in accordance with the terms hereof, such
Administrative Agent shall return such funds (in like funds as received from
such Lender) to such Lender, without interest.

(d)           Obligations of Lenders Several.  The obligations of the Lenders
hereunder to make Loans, to fund participations in Letters of Credit and to make
payments pursuant to Section 10.04(c) are several and not joint.  The failure of
any Lender to make any Loan, to fund any such participation or to make any
payment under Section 10.04(c) on any date required hereunder shall not relieve
any other Lender of its corresponding obligation to do so on such date, and no
Lender shall be responsible for the failure of any other Lender to so make its
Loan, to purchase its participation or to make its payment under
Section 10.04(c).

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

(f)            Insufficient Funds.  If at any time insufficient funds are
received by and available to an Administrative Agent to pay fully all amounts of
principal, L/C Borrowings, interest and fees then due hereunder, such funds
shall be applied (i) first, toward 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, toward
payment of principal and L/C Borrowings then due hereunder, ratably among the
parties entitled thereto in accordance with the amounts of principal and L/C
Borrowings then due to such parties.

2.12        Sharing of Payments by Lenders.  (a) If any Domestic Lender shall,
by exercising any right of setoff or counterclaim or otherwise, obtain payment
in respect of (a) Obligations due and payable to such Domestic Lender hereunder
and under the other Loan Documents at such time in excess of its ratable share
(according to the proportion of (i) the amount of such Obligations due and
payable to such Domestic Lender at such time to (ii) the aggregate amount of the
Obligations due and payable to all Domestic Lenders hereunder and under the
other Loan Documents at such time) of payments on account of the Obligations due
and payable to all

46

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

Domestic Lenders hereunder and under the other Loan Documents at such time
obtained by all the Domestic Lenders at such time or (b) Obligations owing (but
not due and payable) to such Domestic Lender hereunder and under the other Loan
Documents at such time in excess of its ratable share (according to the
proportion of (i) the amount of such Obligations owing (but not due and payable)
to such Domestic Lender at such time to (ii) the aggregate amount of the
Obligations owing (but not due and payable) to all Domestic Lenders hereunder
and under the other Loan Documents at such time) of payment on account of the
Obligations owing (but not due and payable) to all Domestic Lenders hereunder
and under the other Loan Documents at such time obtained by all of the Domestic
Lenders at such time then the Domestic Lender receiving such greater proportion
shall (a) notify the Domestic Administrative Agent of such fact, and (b)
purchase (for cash at face value) participations in the Domestic Loans and
subparticipations in L/C Obligations of the other Domestic Lenders, or make such
other adjustments as shall be equitable, so that the benefit of all such
payments shall be shared by the Domestic Lenders ratably in accordance with the
aggregate amount of Obligations then due and payable to the Domestic Lenders or
owing (but not due and payable) to the Domestic Lenders, as the case may be,
provided that:

(i)            if any such participations or subparticipations are purchased and
all or any portion of the payment giving rise thereto is recovered, such
participations or subparticipations shall be rescinded and the purchase price
restored to the extent of such recovery, without interest; and

(ii)           the provisions of this Section shall not be construed to apply to
(A) any payment made by the Domestic Borrower pursuant to and in accordance with
the express terms of this Agreement or (B) any payment obtained by a Lender as
consideration for the assignment of or sale of a participation in any of its
Domestic Loans or subparticipations in L/C Obligations to any assignee or
participant, other than to the Domestic Borrower or any Subsidiary thereof (as
to which the provisions of this Section shall apply).

(b)           If any Canadian Lender shall, by exercising any right of setoff or
counterclaim or otherwise, obtain payment in respect of (a) Obligations due and
payable to such Canadian Lender hereunder and under the other Loan Documents at
such time in excess of its ratable share (according to the proportion of (i) the
amount of such Obligations due and payable to such Canadian Lender at such time
to (ii) the aggregate amount of the Obligations due and payable to all Canadian
Lenders hereunder and under the other Loan Documents at such time) of payments
on account of the Obligations due and payable to all Canadian Lenders hereunder
and under the other Loan Documents at such time obtained by all the Canadian
Lenders at such time or (b) Obligations owing (but not due and payable) to such
Canadian Lender hereunder and under the other Loan Documents at such time in
excess of its ratable share (according to the proportion of (i) the amount of
such Obligations owing (but not due and payable) to such Canadian Lender at such
time to (ii) the aggregate amount of the Obligations owing (but not due and
payable) to all Canadian Lenders hereunder and under the other Loan Documents at
such time) of payment on account of the Obligations owing (but not due and
payable) to all Canadian Lenders hereunder and under the other Loan Documents at
such time obtained by all of the Canadian Lenders at such time then the Canadian
Lender receiving such greater proportion shall (a) notify the Canadian
Administrative Agent of such fact, and (b) purchase (for cash at face

47

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

value) participations in the Canadian Loans and subparticipations in L/C
Obligations of the other Canadian Lenders, or make such other adjustments as
shall be equitable, so that the benefit of all such payments shall be shared by
the Canadian Lenders ratably in accordance with the aggregate amount of
Obligations then due and payable to the Canadian Lenders or owing (but not due
and payable) to the Canadian Lenders, as the case may be, provided that:

(i)            if any such participations or subparticipations are purchased and
all or any portion of the payment giving rise thereto is recovered, such
participations or subparticipations shall be rescinded and the purchase price
restored to the extent of such recovery, without interest; and

(ii)           the provisions of this Section shall not be construed to apply to
(A) any payment made by the Canadian Borrower pursuant to and in accordance with
the express terms of this Agreement or (B) any payment obtained by a Canadian
Lender as consideration for the assignment of or sale of a participation in any
of its Canadian Loans or subparticipations in L/C Obligations to any assignee or
participant, other than to the Canadian Borrower or any Subsidiary thereof (as
to which the provisions of this Section shall apply).

(c)           From and after the earlier of (i) the occurrence of an Event of
Default under Section 8.01(f) or (g) or (ii) the occurrence of any Event of
Default and the acceleration of the Obligations hereunder (each such occurrence,
a “Sharing Event”), each Lender (x) agrees to purchase from each other Lender,
and each such other Lender agrees to sell, a risk participation in such other
Lender’s outstanding Loans such that, after giving effect to such purchase and
sale, each Lender holds a risk participation in each outstanding Loan in an
amount equal to such Lender’s Aggregate Applicable Percentage and (y) agrees
that its risk participation in each L/C Obligation shall be adjusted (through
purchase and sale or otherwise) to an amount equal to such Lender’s Aggregate
Applicable Percentage thereof.  It is the intention of the Lenders that after
giving effect to the foregoing, each Lender shall hold an interest in each
outstanding Loan and L/C Obligation equal to such Lender’s Aggregate Applicable
Percentage, and each Lender agrees to take such actions as may be reasonably
requested by the Administrative Agents to effect the foregoing.  Notwithstanding
anything to the contrary in Section 2.13(a) or (b), if, from and after a Sharing
Event, any Lender shall obtain on account of the Committed Loans made by it, or
its participations in L/C Borrowings regarding Letters of Credit, any payment
(whether voluntary, involuntary, through the exercise of any right of set-off,
or otherwise) in excess of its Aggregate Applicable Percentage thereof, such
Lender shall immediately (a) notify the Administrative Agents of such fact, and
(b) purchase from the other Lenders such participations in the Committed Loans
made by them and/or such subparticipations in the participations in L/C
Borrowings regarding Letters of Credit as shall be necessary to cause such
purchasing Lender to share the excess payment in respect of such Committed Loans
or such participations, as the case may be, with each of them according to each
such Lender’s Aggregate Applicable Percentage; provided, however, that if all or
any portion of such excess payment is thereafter recovered from the purchasing
Lender, such purchase shall to that extent be rescinded and each such other
Lender shall repay to the purchasing Lender the purchase price paid therefor,
together with an amount equal to such paying Lender’s ratable share (according
to the proportion of (i) the amount of such paying Lender’s required repayment
to (ii) the total amount so recovered from the purchasing Lender) of any
interest or other amount paid or payable by the purchasing Lender

48

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

in respect of the total amount so recovered.  The Borrowers agree that any
Lender so purchasing a participation from another Lender may, to the fullest
extent permitted by law, exercise all its rights of payment (including the right
of set-off, but subject to Section 10.08) with respect to such participation as
fully as if such Lender were the direct creditor of the applicable Borrower in
the amount of such participation.  The Administrative Agents will keep records
(which shall be conclusive and binding in the absence of manifest error) of
participations purchased under this Section and will in each case notify the
Lenders following any such purchases or repayments.  Each Lender that purchases
a participation pursuant to this Section shall from and after such purchase have
the right to give all notices, requests, demands, directions and other
communications under this Agreement with respect to the portion of the
Obligations purchased to the same extent as though the purchasing Lender were
the original owner of the Obligations purchased.

(d)           The Borrowers consent to the foregoing and agree, to the extent
they may effectively do so under applicable law, that any Lender acquiring a
participation pursuant to the foregoing arrangements may exercise against each
Borrower rights of setoff 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.

2.13        Reallocation of Aggregate Commitments.

(a)           Request for Reallocation.  Provided there exists no Event of
Default, upon notice to the Domestic Administrative Agent (which shall promptly
notify the Canadian Administrative Agent and the Lenders), the Borrowers may
from time to time request a reallocation of the Aggregate Commitments between
the Domestic Facility and the Canadian Facility; provided that (i) any such
request shall be in a minimum amount of $1,000,000, (ii) the Borrowers may make
a maximum of twelve such requests in any year, and (iii) in no event shall the
Aggregate Canadian Commitments exceed the Dollar Equivalent of $15,000,000 as of
the date of such reallocation.

(b)           Lender Elections to Reallocate.  Each Lender shall notify the
Domestic Administrative Agent within ten days of the receipt of such notice from
a Borrower whether or not it agrees to reallocate its Commitments and, if so,
whether by an amount equal to, greater than, or less than its Applicable
Percentage of such requested reallocation.  Any Lender not responding within
such time period shall be deemed to have declined.  Notwithstanding the
foregoing, only a Canadian Lender may have a Commitment for a Canadian Loan.

(c)           Notification by Domestic Administrative Agent; Additional
Lenders.  The Domestic Administrative Agent shall promptly notify the Canadian
Administrative Agent, the Borrowers and each Lender of the Lenders’ responses to
each request made hereunder.  To achieve the full amount of a requested
reallocation, and subject to the approval of the Domestic Administrative Agent
and the L/C Issuers (which approvals shall not be unreasonably withheld), the
Borrowers may also invite additional Eligible Assignees to become Lenders
pursuant to a joinder agreement in form and substance satisfactory to the
Domestic Administrative Agent.

(d)           Effective Date and Allocations.  If the Aggregate Commitments are
reallocated in accordance with this Section, the Domestic Administrative Agent
and the

49

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

Borrowers shall determine the effective date (the “Effective Date”) of such
reallocation and the final allocations, which shall in no event be later than
fifteen Business Days after receipt by the Domestic Administrative Agent of the
Borrower’s request therefor (unless such Borrower consents to a later date). 
The Domestic Administrative Agent shall promptly notify the Canadian
Administrative Agent, the Borrowers and the Lenders of the final allocations and
the Effective Date.

(e)           Conditions to Effectiveness.  The Borrowers shall prepay any
Committed Loans outstanding on the Effective Date (and pay any additional
amounts required pursuant to Section 3.05) to the extent necessary to keep the
outstanding Committed Loans ratable with any revised Applicable Percentages
arising from any reallocation of the Commitments under this Section.

2.14        Suballocation of Letter of Credit Sublimits.

(a)           Request for Allocation.  Upon notice to the Domestic
Administrative Agent (which shall promptly notify the Domestic Lenders or the
Canadian Lenders, as applicable), a Borrower may from time to time request an
allocation or reallocation of a portion of the Domestic Letter of Credit
Sublimit or the Canadian Letter of Credit Sublimit to the Hong Kong Branch of
the Domestic Administrative Agent; provided that (i) any such request shall be
in a minimum amount of $100,000, (ii) the Borrowers may make a maximum of twelve
such requests in any year, (iii) in no event shall the amount so allocated by
the Canadian Borrower exceed the Canadian Letter of Credit Sublimit then in
effect and (iv) in no event shall the aggregate amount so allocated by the
Domestic Borrower and the Canadian Borrower exceed the Domestic Letter of Credit
Sublimit then in effect.  Any amounts so allocated or reallocated may be
reallocated by the Borrower to its Letter of Credit Sublimit at any time and
from time to time.  If a Borrower shall allocate or reallocate amounts to or
from its Letter of Credit Sublimit, the Domestic Administrative Agent and such
Borrower shall determine the effective date of such allocation or reallocation,
which shall in no event be before the fifth Business Day immediately following
the date of such notice.  The Hong Kong Subfacility is part of, and not in
addition to, the Domestic Letter of Credit Sublimit and the Canadian Letter of
Credit Sublimit.

(b)           Utilization of Hong Kong Subfacility.  It is understood that
amounts allocated to the Domestic Administrative Agent’s Hong Kong Branch may be
utilized by the Borrowers for the issuance of commercial Letters of Credit, the
issuance of shipside bonds of up to 180 days and other trade products reasonably
acceptable to the Hong Kong Branch of the Domestic Administrative Agent, and
that availability for Letters of Credit under the Domestic Commitments or
Canadian Commitments, as applicable, shall be reduced by the allocation to the
Hong Kong Subfacility.  The applicable Borrower shall pay to the Domestic
Administrative Agent’s Hong Kong office fees on any shipside bonds and other
trade products at such rates and times as may be mutually agreed by such
Borrower and office.

ARTICLE III
TAXES, YIELD PROTECTION AND ILLEGALITY

3.01        Taxes.  (a) Payments Free of Taxes.  Any and all payments by or on
account of any obligation of the Borrowers hereunder or under any other Loan
Document shall be made free

50

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

and clear of and without reduction or withholding for any Indemnified Taxes or
Other Taxes, provided that if the Borrowers shall be required by applicable law
to deduct or withhold any Indemnified Taxes (including any Other Taxes) from
such payments, then (i) the sum payable shall be increased as necessary so that
after making all required deductions or withholdings (including deductions
applicable to additional sums payable under this Section) the applicable
Administrative Agent, any Lender or the applicable L/C Issuer, as the case may
be, receives an amount equal to the sum it would have received had no such
deductions or withholdings been made, (ii) the applicable Borrower shall make
such deductions or withholdings and (iii) the applicable Borrower shall timely
pay the full amount deducted or withheld to the relevant Governmental Authority
in accordance with applicable law.

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

(c)           Indemnification by the Borrowers.  The Borrowers shall indemnify
the Administrative Agents, each Lender and the L/C Issuers, within 10 days after
demand therefor, for the full amount of any Indemnified Taxes or Other Taxes
(including Indemnified Taxes or Other Taxes imposed or asserted on or
attributable to amounts payable under this Section) paid by such Administrative
Agent, such Lender or such L/C Issuer, as the case may be, and any penalties,
interest and reasonable expenses arising therefrom or with respect thereto,
whether or not such Indemnified Taxes or Other Taxes were correctly or legally
imposed or asserted by the relevant Governmental Authority.  A certificate as to
the amount of such payment or liability delivered to the applicable Borrower by
a Lender or L/C Issuer (with a copy to the applicable Administrative Agent), or
by an Administrative Agent on its own behalf or on behalf of a Lender or an L/C
Issuer, shall be conclusive absent manifest error.

(d)           Evidence of Payments.  As soon as practicable after any payment of
Indemnified Taxes or Other Taxes by a Borrower to a Governmental Authority, such
Borrower shall deliver to the applicable Administrative 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 such Administrative Agent.

(e)           Status of Lenders.  Any Lender that is entitled to an exemption
from or reduction of withholding Tax under the law of the jurisdiction in which
a Borrower is resident for Tax purposes, or any treaty to which such
jurisdiction is a party, with respect to payments hereunder or under any other
Loan Document shall, if requested by a Borrower or the applicable Administrative
Agent, deliver to such Borrower (with a copy to the applicable Administrative
Agent), at the time or times prescribed by applicable law or reasonably
requested by such Borrower or such Administrative Agent, such properly completed
and executed documentation prescribed by applicable law as will permit such
payments to be made without withholding or at a reduced rate of withholding.  In
addition, any Lender, if requested by a Borrower or the applicable
Administrative Agent, shall deliver such other documentation prescribed by
applicable law or reasonably requested by such Borrower or such Administrative
Agent as will enable such Borrower or such Administrative Agent to determine
whether or not such Lender is subject to backup withholding or information
reporting requirements.

51

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

(f)            Treatment of Certain Refunds.  If an Administrative Agent, any
Lender or an L/C Issuer determines, in its good faith discretion, that it has
received a refund of any Taxes or Other Taxes as to which it has been
indemnified by a Borrower or with respect to which a Borrower has paid
additional amounts pursuant to this Section 3.01, it shall pay to such Borrower
an amount equal to such refund (but only to the extent of indemnity payments
made, or additional amounts paid, by such Borrower under this Section with
respect to the Taxes or Other Taxes giving rise to such refund), net of all out
of pocket expenses of such Administrative Agent, such Lender or such L/C Issuer,
as the case may be, 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 Administrative Agent, such Lender or such L/C
Issuer, agrees to repay the amount paid over to such Borrower (plus any
penalties, interest or other charges imposed by the relevant Governmental
Authority) to such Administrative Agent, such Lender or such L/C Issuer if such
Administrative Agent, such Lender or such L/C Issuer is required to repay such
refund to such Governmental Authority.  This subsection shall not be construed
to require any Administrative Agent, any Lender or any L/C Issuer to make
available its Tax returns (or any other information relating to its Taxes that
it deems confidential) to the Borrowers.

(g)           Contest.  If a Borrower determines in good faith that a reasonable
basis exists for contesting a Tax or Other Tax with respect to which the
Borrower has paid an additional amount under this Section 3.01, the relevant
Lender, Administrative Agent or L/C Issuer, as applicable, shall cooperate with
the Borrower (but shall have no obligation to disclose any confidential
information, unless arrangements satisfactory to the relevant Lender have been
made to preserve the confidential nature of such information) in challenging
such Tax or Other Tax at the Borrower’s expense if requested by the Borrower (it
being understood and agreed that none of the Administrative Agents, L/C Issuers
or any Lender shall have any obligation to contest, or any responsibility for
contesting, any Tax), and any cost incurred by the relevant Lender,
Administrative Agent, or L/C Issuer in connection with its cooperation shall be
borne by the relevant Borrower.

3.02        Illegality.  If any Lender determines that any Law has made it
unlawful, or that any Governmental Authority has asserted that it is unlawful,
for any Lender or its applicable Lending Office to make, maintain or fund
Eurodollar Rate Loans, or to determine or charge interest rates based upon the
Eurodollar Rate, or any Governmental Authority has imposed material restrictions
on the authority of such Lender to purchase or sell, or to take deposits of,
Dollars in the London interbank market, then, on notice thereof by such Lender
to the applicable Borrower through the applicable Administrative Agent, any
obligation of such Lender to make or continue Eurodollar Rate Loans or to
convert Base Rate Loans to Eurodollar Rate Loans shall be suspended until such
Lender notifies such Administrative Agent and such Borrower that the
circumstances giving rise to such determination no longer exist.  Upon receipt
of such notice, such Borrower shall, upon demand from such Lender (with a copy
to the applicable Administrative Agent), prepay or, if applicable, convert all
Eurodollar Rate Loans of such Lender to Base Rate Loans, either on the last day
of the Interest Period therefor, if such Lender may lawfully continue to
maintain such Eurodollar Rate Loans to such day, or immediately, if such Lender
may not lawfully continue to maintain such Eurodollar Rate Loans.  Upon any such
prepayment or conversion, the applicable Borrower shall also pay accrued
interest on the amount so prepaid or converted. 

52

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

3.03        Inability to Determine Rates.  If the Required Lenders determine
that for any reason in connection with any request for a Eurodollar Rate Loan or
a conversion to or continuation thereof that (a) Dollar deposits are not being
offered to banks in the London interbank eurodollar market for the applicable
amount and Interest Period of such Eurodollar Rate Loan, (b) adequate and
reasonable means do not exist for determining the Eurodollar Rate for any
requested Interest Period with respect to a proposed Eurodollar Rate Loan, or
(c) the Eurodollar Rate for any requested Interest Period with respect to a
proposed Eurodollar Rate Loan does not adequately and fairly reflect the cost to
such Lenders of funding such Loan, the Administrative Agents will promptly so
notify the Borrower and each Lender.  Thereafter, the obligation of the Lenders
to make or maintain Eurodollar Rate Loans shall be suspended until the
Administrative Agents (upon the instruction of the Required Lenders) revoke such
notice.  Upon receipt of such notice, the Borrowers may revoke any pending
request for a Committed Borrowing of, conversion to or continuation of
Eurodollar Rate Loans or, failing that, will be deemed to have converted such
request into a request for a Committed Borrowing of Base Rate Loans in the
amount specified therein.

3.04        Increased Costs; Reserves on Eurodollar Rate Loans.  (a) Increased
Costs Generally.  Subject to the provisions of Section 3.01 (which shall be
conclusive with respect to matters covered thereby), if any Change in Law shall:

(i)            impose, modify or deem applicable any reserve, special deposit,
compulsory loan, insurance charge or similar requirement against assets of,
deposits with or for the account of, or credit extended or participated in by,
any Lender (except any reserve requirement contemplated by Section 3.04(e)) or
any L/C Issuer;

(ii)           subject any Lender or any L/C Issuer to any Tax of any kind
whatsoever with respect to this Agreement, any Letter of Credit, any
participation in a Letter of Credit or any Eurodollar Rate Loan made by it, or
change the basis of taxation of payments to such Lender or L/C Issuer in respect
thereof (except for Indemnified Taxes or Other Taxes covered by Section 3.01 and
the imposition of, or any change in the rate of, any Excluded Tax payable by
such Lender or L/C Issuer); or

(iii)          impose on any Lender or any L/C Issuer or the London interbank
market any other condition, cost or expense affecting this Agreement or
Eurodollar Rate Loans made by such Lender or any Letter of Credit or
participation therein;

and the result of any of the foregoing shall be to increase the cost to such
Lender of making or maintaining any Eurodollar Rate Loan (or of maintaining its
obligation to make any such Loan), or to increase the cost to such Lender or
such L/C Issuer of participating in, issuing or maintaining any Letter of Credit
(or of maintaining its obligation to participate in or to issue any Letter of
Credit), or to reduce the amount of any sum received or receivable by such
Lender or such L/C Issuer hereunder (whether of principal, interest or any other
amount) then, upon request of such Lender or L/C Issuer, the applicable Borrower
will pay to such Lender or such L/C Issuer, as the case may be, such additional
amount or amounts as will compensate such Lender or such L/C Issuer, as the case
may be, for such additional costs incurred or reduction suffered.

53

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

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

(c)           Certificates for Reimbursement.  A certificate of a Lender or an
L/C Issuer setting forth the amount or amounts necessary to compensate such
Lender or such L/C Issuer or its holding company, as the case may be, as
specified in subsection (a) or (b) of this Section and delivered to the
applicable Borrower shall be conclusive absent manifest error.  Such Borrower
shall pay such Lender or such L/C Issuer, as the case may be, the amount shown
as due on any such certificate within 10 days after receipt thereof.

(d)           Delay in Requests.  Failure or delay on the part of any Lender or
any L/C Issuer to demand compensation pursuant to the foregoing provisions of
this Section shall not constitute a waiver of such Lender’s or such L/C Issuer’s
right to demand such compensation, provided that the Borrowers shall not be
required to compensate a Lender or an L/C Issuer pursuant to the foregoing
provisions of this Section for any increased costs incurred or reductions
suffered more than nine months prior to the date that such Lender or such L/C
Issuer, as the case may be, notifies the Borrowers of the Change in Law giving
rise to such increased costs or reductions and of such Lender’s or such L/C
Issuer’s intention to claim compensation therefor (except that, if the Change in
Law giving rise to such increased costs or reductions is retroactive, then the
nine-month period referred to above shall be extended to include the period of
retroactive effect thereof).

(e)           Reserves on Eurodollar Rate Loans.  The Borrowers shall pay to
each Lender, as long as such Lender shall be required to maintain reserves with
respect to liabilities or assets consisting of or including Eurocurrency funds
or deposits (currently known as “Eurocurrency liabilities”), additional interest
on the unpaid principal amount of each Eurodollar Rate Loan equal to the actual
costs of such reserves allocated to such Loan by such Lender (as determined by
such Lender in good faith, which determination shall be conclusive), which shall
be due and payable on each date on which interest is payable on such Loan,
provided the Borrowers shall have received at least 10 days’ prior notice (with
a copy to the Administrative Agents) of such additional interest from such
Lender.  If a Lender fails to give notice 10 days prior to the relevant Interest
Payment Date, such additional interest shall be due and payable 10 days from
receipt of such notice.

54

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

3.05        Compensation for Losses.  Upon demand of any Lender (with a copy to
the applicable Administrative Agent) from time to time, the applicable Borrower
shall promptly compensate such Lender for and hold such Lender harmless from any
loss, cost or expense incurred by it as a result of:

(a)           any continuation, conversion, payment or prepayment of any Loan
other than a Base Rate Loan on a day other than the last day of the Interest
Period for such Loan (whether voluntary, mandatory, automatic, by reason of
acceleration, or otherwise);

(b)           any failure by such Borrower (for a reason other than the failure
of such Lender to make a Loan) to prepay, borrow, continue or convert any Loan
other than a Base Rate Loan on the date or in the amount notified by such
Borrower; or

(c)           any assignment of a Eurodollar Rate Loan on a day other than the
last day of the Interest Period therefor as a result of a request by such
Borrower pursuant to Section 10.13;

including any loss of anticipated profits and any loss or expense arising from
the liquidation or reemployment of funds obtained by it to maintain such Loan or
from fees payable to terminate the deposits from which such funds were obtained.
 The applicable Borrower shall also pay any customary administrative fees
charged by such Lender in connection with the foregoing.

For purposes of calculating amounts payable by a Borrower to the Lenders under
this Section 3.05, each Lender shall be deemed to have funded each Eurodollar
Rate Loan made by it at the Eurodollar Rate for such Loan by a matching deposit
or other borrowing in the London interbank eurodollar market for a comparable
amount and for a comparable period, whether or not such Eurodollar Rate Loan was
in fact so funded.

3.06        Mitigation Obligations; Replacement of Lenders.  (a) Designation of
a Different Lending Office.  If any Lender requests compensation under
Section 3.04, or a Borrower is required to pay any additional amount to any
Lender or any Governmental Authority for the account of any Lender pursuant to
Section 3.01, or if any Lender gives a notice pursuant to Section 3.02, then
such Lender 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 3.01 or 3.04, as the case may be,
in the future, or eliminate the need for the notice pursuant to Section 3.02, as
applicable, and (ii) in each case, would not subject such Lender to any
unreimbursed cost or expense and would not otherwise be disadvantageous to such
Lender.  The applicable Borrower hereby agrees to pay all reasonable costs and
expenses incurred by any Lender in connection with any such designation or
assignment.

(b)           Replacement of Lenders.  If any Lender requests compensation under
Section 3.04, or if a Borrower is required to pay any additional amount to any
Lender or any Governmental Authority for the account of any Lender pursuant to
Section 3.01, such Borrower may replace such Lender in accordance with
Section 10.13.

55

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

3.07        Survival.  All of the Borrowers’ obligations under this Article III
shall survive termination of the Aggregate Commitments and repayment of all
other Obligations hereunder.

ARTICLE IV
CONDITIONS PRECEDENT TO CREDIT EXTENSIONS

4.01        Conditions of Initial Credit Extension.  The obligation of the L/C
Issuers and each Lender to make its initial Credit Extension hereunder is
subject to satisfaction of the following conditions precedent:

(a)           The Domestic Administrative Agent’s receipt of the following, each
of which shall be originals or telecopies (followed promptly by originals)
unless otherwise specified, each properly executed by a Responsible Officer of
the signing Loan Party, each dated the Closing Date (or, in the case of
certificates of governmental officials, a recent date before the Closing Date)
and each in form and substance satisfactory to the Domestic Administrative
Agent:

(i)            executed counterparts of this Agreement and the Guaranty,
sufficient in number for distribution to the Administrative Agents and the
Borrowers;

(ii)           a Note executed by each Borrower in favor of each Lender;

(iii)          a security agreement, in substantially the form of Exhibit F
(together with each other security agreement and security agreement supplement
delivered pursuant to Section 6.12, in each case as amended, the “Security
Agreement”), duly executed by each Loan Party, together with:

(A)          Financing Statements in form appropriate for filing under the
Uniform Commercial Code of all jurisdictions that the Domestic Administrative
Agent may reasonably deem necessary or desirable in order to perfect the Liens
created under the Security Agreement, covering the Collateral described in the
Security Agreement,

(B)           completed requests for information, dated on or before the date of
the initial Credit Extension, including the results of a recent search of all
effective financing statements filed in the jurisdiction of incorporation of
each Loan Party that name any Loan Party as debtor, together with copies of such
other financing statements to the extent reasonably requested by Domestic
Administrative Agent,

(C)           evidence of the completion of all other actions, recordings and
filings of or with respect to the Security Agreement that the Domestic
Administrative Agent may reasonably deem necessary or desirable in order to
perfect the Liens created thereby, and

(D)          evidence that all other action that the Domestic Administrative
Agent may reasonably deem necessary or desirable in order to

56

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

perfect the Liens created under the Security Agreement has been taken (including
receipt of duly executed payoff letters and UCC-3 termination statements);

(iv)          the Pledge Agreement, duly executed by the Domestic Borrower and
each Domestic Subsidiary that holds Equity Interests in other Domestic
Subsidiaries or in a first-tier Foreign Subsidiary, together with:

(A)          certificates, if any, representing the pledged Equity Interests
referred to therein accompanied by undated stock powers executed in blank, and

(B)           Financing Statements in form appropriate for filing under the
Uniform Commercial Code of all jurisdictions that the Domestic Administrative
Agent may reasonably deem necessary or desirable in order to perfect the Liens
created under the Pledge Agreement, covering the Collateral described in the
Pledge Agreement;

(v)           executed counterparts of the Guaranty;

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

(vii)         such documents and certifications as the Administrative Agents may
reasonably require to evidence that each Loan Party is duly organized or formed,
and that each of the Borrowers and the Guarantors is validly existing and in
good standing in its jurisdiction of formation;

(viii)        favorable opinions of O’Melveny & Myers LLP, Stikeman Elliott LLP,
and the General Counsel to the Loan Parties, addressed to the Domestic
Administrative Agent and each Domestic Lender, as to the matters set forth in
Exhibit G and such other matters concerning the Loan Parties and the Loan
Documents as the Required Lenders may reasonably request;

(ix)           a certificate of a Responsible Officer of the Domestic Borrower
either (A) stating that all consents, licenses and approvals required in
connection with the execution, delivery and performance by each Loan Party and
the validity against each Loan Party of the Loan Documents to which it is a
party have been obtained, and such consents, licenses and approvals shall be in
full force and effect, or (B) stating that no such consents, licenses or
approvals are so required;

(x)            a certificate signed by a Responsible Officer of the Domestic
Borrower certifying (A) that the conditions specified in Sections 4.02(a) and
(b) have been satisfied, (B) that there has been no event or circumstance since
the date of the Audited Financial Statements that has had or would be reasonably
expected to have,

57

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

either individually or in the aggregate, a Material Adverse Effect; and (C) a
calculation of the Total Adjusted Leverage Ratio as of the last day of the
fiscal quarter of the Domestic Borrower most recently ended prior to the Closing
Date;

(xi)           certificates of insurance, naming the Domestic Administrative
Agent, on behalf of the Lenders, as an additional insured or loss payee, as the
case may be, under all insurance policies maintained with respect to the assets
and properties of the Loan Parties that constitute Collateral;

(xii)          evidence that the Existing Credit Agreement has been, or
concurrently with the Closing Date is being, terminated and all Liens securing
obligations under the Existing Credit Agreement have been, or concurrently with
the Closing Date are being, released; and

(xiii)         such other assurances, certificates, documents, consents or
opinions as the Administrative Agents or the L/C Issuers reasonably may require.

(b)           All fees required to be paid to the Administrative Agents on or
before the Closing Date shall have been paid.

(c)           Unless waived by the Administrative Agents, the Domestic Borrower
shall have paid all reasonable fees, charges and disbursements of counsel to the
Administrative Agents (directly to such counsel if requested by the
Administrative Agents) to the extent invoiced prior to or on the Closing Date,
plus such additional amounts of such reasonable fees, charges and disbursements
as shall constitute its reasonable estimate of such fees, charges and
disbursements incurred or to be incurred by it through the closing proceedings
(provided that such estimate shall not thereafter preclude a final settling of
accounts between the Domestic Borrower and the Administrative Agents).

Without limiting the generality of the provisions of Section 9.04, for purposes
of determining compliance with the conditions specified in this Section 4.01,
each Lender that has signed this Agreement shall be deemed to have consented to,
approved or accepted or to be satisfied with, each document or other matter
required thereunder to be consented to or approved by or acceptable or
satisfactory to a Lender unless the Domestic Administrative Agent shall have
received notice from such Lender prior to the proposed Closing Date specifying
its objection thereto.

4.02        Conditions to all Credit Extensions.  The obligation of each Lender
to honor any Request for Credit Extension (other than a Committed Loan Notice
requesting only a conversion of Loans to the other Type, or a continuation of
Eurodollar Rate Loans) is subject to the following conditions precedent:

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

58

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

purposes of this Section 4.02, the representations and warranties contained in
Sections 5.05(a) and (b) shall be deemed to refer to the most recent statements
furnished pursuant to Sections 6.01(a) and (b), respectively.

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

(c)           The applicable Administrative Agent and, if applicable, the
applicable L/C Issuer shall have received a Request for Credit Extension in
accordance with the requirements hereof.

Each Request for Credit Extension (other than a Committed Loan Notice requesting
only a conversion of Loans to the other Type or a continuation of Eurodollar
Rate Loans) submitted by a Borrower shall be deemed to be a representation and
warranty that the conditions specified in Sections 4.02(a) and (b) have been
satisfied on and as of the date of the applicable Credit Extension.

ARTICLE V
REPRESENTATIONS AND WARRANTIES

The Domestic Borrower represents and warrants to the Administrative Agents and
the Lenders that:

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

5.02        Authorization; No Contravention.  The execution, delivery and
performance by each Loan Party of each Loan Document to which such Person is or
is to be a party have been duly authorized by all necessary corporate or other
organizational action, and do not and will not (a) contravene the terms of any
of such Person’s Organization Documents; (b) conflict with or result in any
material breach or contravention of, or the creation of any Lien under (i) any
material Contractual Obligation to which such Person is a party or (ii) any
order, injunction, writ or decree of any Governmental Authority or any arbitral
award to which such Person or its property is subject; or (c) violate any Law.

5.03        Governmental Authorization; Other Consents.  No approval, consent,
exemption, authorization, or other action by any Governmental Authority or any
other Person is necessary or required in connection with (a) the execution,
delivery or performance by, or enforcement against, any Loan Party of this
Agreement or any other Loan Document, (b) the grant by any Loan Party of the
Liens granted by it pursuant to the Collateral Documents, or (c) the perfection

59

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

of the Liens created under the Collateral Documents (including the first
priority nature thereof), except such as have been obtained.

5.04        Binding Effect.  This Agreement has been, and each other Loan
Document, when delivered hereunder, will have been, duly executed and delivered
by each Loan Party that is party thereto.  This Agreement constitutes, and each
other Loan Document when so delivered will constitute, a legal, valid and
binding obligation of such Loan Party, enforceable against each Loan Party that
is party thereto in accordance with its terms, except as may be limited by
bankruptcy, insolvency, reorganization, moratorium or similar laws relating to
or limiting creditors’ rights generally or by equitable principles relating to
enforceability.

5.05        Financial Statements; No Material Adverse Effect; No Internal
Control Event. 

(a)           The Audited Financial Statements (i) were prepared in all material
respects in accordance with GAAP consistently applied throughout the period
covered thereby, except as otherwise expressly noted therein; (ii) fairly
present in all material respects the financial condition of the Domestic
Borrower and its Subsidiaries as of the date thereof and their results of
operations for the period covered thereby in accordance with GAAP consistently
applied throughout the period covered thereby, except as otherwise expressly
noted therein; and (iii) show all material indebtedness and other liabilities,
direct or contingent, of the Domestic Borrower and its Subsidiaries as of the
date thereof, including liabilities for Taxes, material commitments and
Indebtedness, in each case, to the extent required to be shown thereon in
accordance with GAAP.

(b)           The unaudited consolidated balance sheets of the Domestic Borrower
and its Subsidiaries dated July 1, 2006, and the related consolidated statements
of income or operations, shareholders’ equity and cash flows for the fiscal
quarter ended on that date (i) were prepared in all material respects in
accordance with GAAP consistently applied throughout the period covered thereby,
except as otherwise expressly noted therein, and (ii) fairly present in all
material respects the financial condition of the Domestic Borrower and its
Subsidiaries as of the date thereof and their results of operations for the
period covered thereby, subject, in the case of clauses (i) and (ii), to the
absence of footnotes and to normal year-end audit adjustments.  Schedule 7.02
sets forth all material indebtedness of the Domestic Borrower and its
consolidated Subsidiaries as of the Closing Date.

(c)           Since the date of the Audited Financial Statements, there has been
no event or circumstance, either individually or in the aggregate, that has had
or would reasonably be expected to have a Material Adverse Effect. 

(d)           To the best knowledge of the Domestic Borrower, no Internal
Control Event exists or has occurred since the date of the Audited Financial
Statements that has resulted in or could reasonably be expected to result in a
Material Adverse Effect.

(e)           The consolidated forecasted balance sheets, statements of income
and cash flows of the Domestic Borrower and its Subsidiaries delivered pursuant
to Section 6.01(c) were prepared in good faith on the basis of the assumptions
stated therein, which assumptions were believed to be reasonable in light of the
conditions existing at the time of delivery of such

60

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

forecasts, it being understood that projections as to future events are not to
be viewed as facts and that actual results may differ from the projections.

5.06        Litigation.  There are no actions, suits, proceedings, claims or
disputes pending or, to the knowledge of a Responsible Officer of the Domestic
Borrower, threatened, at law, in equity, in arbitration or before any
Governmental Authority, by or against the Domestic Borrower or any of its
Subsidiaries or against any of their properties or revenues that (a) purport to
affect or pertain to this Agreement or any other Loan Document, or (b) except as
specifically disclosed in  Schedule 5.06 (the “Disclosed Litigation”), either
individually or in the aggregate, would reasonably be expected to have a
Material Adverse Effect.

5.07        No Default.  Neither any Loan Party nor any Subsidiary thereof is in
default under or with respect to, or a party to, any Contractual Obligation that
would, either individually or in the aggregate, reasonably be expected to have a
Material Adverse Effect.  No Default has occurred and is continuing or would
result from the consummation of the transactions contemplated by this Agreement
or any other Loan Document.

5.08        Ownership of Real Property; Liens.  (a) Each Loan Party and each of
its Subsidiaries has legal title in fee simple to, or valid leasehold interests
in, all real property necessary or used in the ordinary conduct of its business,
except for such defects in title as would not, individually or in the aggregate,
reasonably be expected to have a Material Adverse Effect. 

(b)           As of the Closing Date, Schedule 7.01 sets forth a complete and
accurate list of all Liens on the property or assets (other than real property)
of each Loan Party and all material Liens on the property or assets (other than
real property) of each of its Subsidiaries, showing as of the date hereof the
lienholder thereof and the property or assets of such Loan Party or such
Subsidiary subject thereto.  The property of each Loan Party and each of its
Subsidiaries is subject to no Liens, other than Liens permitted by Section 7.01.

(c)           As of the Closing Date, Schedule 5.08(c) sets forth a complete and
accurate list of all real property owned in fee simple by each Loan Party. 

(d)           As of the Closing Date, Schedule 5.08(d) sets forth a complete and
accurate list of all leases of real property under which any Loan Party is the
lessee.  To the Domestic Borrower’s knowledge, each such lease is the legal,
valid and binding obligation of the lessor thereof, enforceable in accordance
with its terms.

(e)           As of the Closing Date, Schedule 7.03 sets forth a complete and
accurate list of all Investments held by any Loan Party or any Subsidiary of a
Loan Party, exclusive of (i) Investments in other Loan Parties or any
Subsidiaries of Loan Parties and (ii) Investments in the publicly traded Equity
Interests of third parties.

5.09        Environmental Compliance.  The Borrower has reasonably concluded
that, except as specifically disclosed in Schedule 5.09, Environmental Laws and
claims could not, individually or in the aggregate, reasonably be expected to
have a Material Adverse Effect.

5.10        Insurance.  The properties of the Domestic Borrower and its
Subsidiaries are insured with financially sound and reputable insurance
companies not Affiliates of the Borrower,

61

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

in such amounts, with such deductibles and covering such risks as are
customarily carried by companies engaged in similar businesses and owning
similar properties in localities where the Domestic Borrower or the applicable
Subsidiary operates.

5.11        Taxes.  The Domestic Borrower and its Subsidiaries have filed all
Federal, state, provincial and other material Tax returns and reports required
to be filed, and have paid all Federal, state and other material Taxes,
assessments, fees and other governmental charges levied or imposed upon them or
their properties, income or assets otherwise due and payable, except those which
are being contested in good faith by appropriate proceedings diligently
conducted and for which adequate reserves have been provided in accordance with
GAAP.  There is no proposed Tax assessment against the Domestic Borrower or any
Subsidiary that would, if made, have a Material Adverse Effect.

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

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

(c)           (i) No ERISA Event has occurred or is reasonably expected to
occur; (ii) no Pension Plan has any Unfunded Pension Liability; (iii) neither
the Domestic Borrower nor any ERISA Affiliate has incurred, or reasonably
expects to incur, any liability under Title IV of ERISA with respect to any
Pension Plan (other than premiums due and not delinquent under Section 4007 of
ERISA); (iv) neither the Domestic Borrower nor any ERISA Affiliate has incurred,
or reasonably expects to incur, any liability (and no event has occurred which,
with the giving of notice under Section 4219 of ERISA, would result in such
liability) under Section 4201 or 4243 of ERISA with respect to a Multiemployer
Plan that has resulted or would reasonably be expected to result in a Material
Adverse Effect; and (v) neither the Domestic Borrower nor any ERISA Affiliate
has engaged in a transaction that could be subject to Section 4069 or 4212(c) of
ERISA.

5.13        Subsidiaries; Equity Interests; Loan Parties.  As of the Closing
Date, the Domestic Borrower has no Subsidiaries other than those specifically
disclosed in Part (a) of Schedule 5.13, and all of the outstanding Equity
Interests in such Subsidiaries have been validly issued, are fully paid and
non-assessable and are owned by a Loan Party in the amounts specified on Part
(a) of Schedule 5.13 free and clear of all Liens except those created under the
Collateral Documents.  As of the Closing Date, the Domestic Borrower has no
equity investments in any other

62

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

corporation or entity other than (i) those specifically disclosed in Part (b) of
Schedule 5.13 and (ii) Investments in the publicly traded Equity Interests of
third parties.

5.14        Margin Regulations; Investment Company Act; Public Utility Holding
Company Act.  (a) The Domestic Borrower is not engaged and will not engage,
principally or as one of its important activities, in the business of purchasing
or carrying margin stock (within the meaning of Regulation U issued by the FRB),
or extending credit for the purpose of purchasing or carrying margin stock.

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

5.15        Disclosure.  The Domestic Borrower has disclosed to the
Administrative Agents and the Lenders all matters known to it that, individually
or in the aggregate, could reasonably be expected to result in a Material
Adverse Effect.  No written report, financial statement, certificate or other
written information furnished by or on behalf of any Loan Party to the
Administrative Agents or any Lender in connection with the transactions
contemplated hereby and the negotiation of this Agreement or delivered hereunder
or under any other Loan Document (in each case as modified or supplemented by
other information so furnished) contains any material misstatement of fact or
omits to state any material fact necessary to make the statements therein, in
the light of the circumstances under which they were made, not misleading;
provided that, with respect to projected financial information, the Domestic
Borrower represents only that such information was prepared in good faith based
upon assumptions believed to be reasonable at the time (it being understood that
such projections are not to be viewed as facts and that actual results may
differ significantly from such projections).

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

5.17        Intellectual Property; Licenses, Etc.  Each Loan Party and each of
its Subsidiaries own, or possess the right to use, all of the material
trademarks, service marks, trade names, copyrights, patents, patent rights,
franchises, licenses and other intellectual property rights (collectively, “IP
Rights”) that are reasonably necessary for the operation of their respective
businesses, without conflict with the rights of any other Person, and as of the
Closing Date, Schedule 5.17 sets forth a complete and accurate list of all such
IP Rights registered in the United States that are owned by each Loan Party.  To
the knowledge of the Responsible Officers of the Domestic Borrower, no slogan or
other advertising device, product, process, method, substance, part or other
material now employed, or now contemplated to be employed, by any Loan Party or
any of its Subsidiaries infringes upon any material rights held by any other
Person in a manner that would reasonably be expected to result in a Material
Adverse Effect.  Except as specifically disclosed in Schedule 5.17, no claim or
litigation regarding any of the foregoing is

63

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

pending or, to the knowledge of any Responsible Officer of either Borrower,
threatened, which, either individually or in the aggregate, would reasonably be
expected to have a Material Adverse Effect.

ARTICLE VI
AFFIRMATIVE COVENANTS

So long as any Lender shall have any Commitment hereunder, any Loan or other
Obligation hereunder shall remain unpaid or unsatisfied, or any Letter of Credit
shall remain outstanding and not cash collateralized or otherwise supported in a
manner acceptable to the Domestic Administrative Agent, the Domestic Borrower
shall, and shall (except in the case of the covenants set forth in
Sections 6.01, 6.02, 6.03 and 6.11) cause each Subsidiary to:

6.01        Financial Statements.  Deliver to the Domestic Administrative Agent,
in form and detail satisfactory to the Domestic Administrative Agent:

(a)           as soon as available, but in any event within 90 days after the
end of each fiscal year of the Domestic Borrower (commencing with the fiscal
year ended December 31, 2006), a consolidated balance sheet of the Domestic
Borrower and its Subsidiaries as at the end of such fiscal year, and the related
consolidated statements of income or operations, shareholders’ equity and cash
flows for such fiscal year, together with such other financial information as
the SEC may from time to time require to be included in a Form 10 K filing, all
in reasonable detail and prepared in accordance with GAAP, audited and
accompanied by a report and opinion of a Registered Public Accounting Firm,
which report and opinion shall be prepared in accordance with generally accepted
auditing standards and applicable Securities Laws and shall not be subject to
any “going concern” or like qualification or exception or any qualification or
exception as to the scope of such audit or with respect to the absence of any
material misstatement;

(b)           as soon as available, but in any event within 50 days after the
end of each of the first three fiscal quarters of each fiscal year of the
Domestic Borrower (commencing with the fiscal quarter ended September 30, 2006),
a consolidated balance sheet of the Domestic Borrower and its Subsidiaries as at
the end of such fiscal quarter, and the related consolidated statements of
income or operations and cash flows for such fiscal quarter and for the portion
of such Domestic Borrower’s fiscal year then ended, together with such other
financial information as the SEC may from time to time require to be included in
a Form 10 Q filing, all in reasonable detail, certified by a Responsible Officer
of the Domestic Borrower as fairly presenting the financial condition, results
of operations and cash flows of such Domestic Borrower and its Subsidiaries in
accordance with GAAP, subject only to normal year-end audit adjustments and the
absence of footnotes; and

(c)           as soon as available, but in any event not later than 60 days
after the end of each fiscal year of the Domestic Borrower, a three year
business plan and budget of the Domestic Borrower and its Subsidiaries on a
consolidated basis, including forecasts prepared by management of the Domestic
Borrower, in form satisfactory to the Administrative Agent and the Required
Lenders, of consolidated balance sheets and statements of income or operations
and

64

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

cash flows of the Domestic Borrower and its Subsidiaries on a quarterly basis
for the immediately following fiscal year and on an annual basis for the two
fiscal years thereafter.

As to any information contained in materials furnished pursuant to
Section 6.02(b), the Domestic Borrower shall not be separately required to
furnish such information under Section 6.01(a) or (b) above, but the foregoing
shall not be in derogation of the obligation of the Domestic Borrower to furnish
the information and materials described in Sections 6.01(a) and (b) above at the
times specified therein.

6.02        Certificates; Other Information.  Deliver to the Domestic
Administrative Agent, in form and detail satisfactory to the Domestic
Administrative Agent:

(a)           concurrently with the delivery of the financial statements
referred to in Sections 6.01(a) and (b), a duly completed Compliance Certificate
signed by a Responsible Officer of the Domestic Borrower;

(b)           promptly after the same are available, copies of each annual
report, proxy or financial statement or other report or communication sent to
the stockholders of the Domestic Borrower, and copies of all annual, regular,
periodic and special reports and registration statements which the Domestic
Borrower may file or be required to file with the SEC under Section 13 or 15(d)
of the Securities Exchange Act of 1934, or with any national securities
exchange, and in any case not otherwise required to be delivered to the Domestic
Administrative Agent pursuant hereto;

(c)           promptly after the furnishing thereof, copies of any notice of
default furnished to any holder of debt securities of any Loan Party or of any
of its Subsidiaries pursuant to the terms of any indenture, loan or credit or
similar agreement representing Indebtedness in an aggregate outstanding amount
in excess of the Threshold Amount and not otherwise required to be furnished to
the Domestic Administrative Agent pursuant to Section 6.01 or any other clause
of this Section 6.02;

(d)           promptly, and in any event within five Business Days after receipt
thereof by any Loan Party or any Subsidiary thereof, copies of each notice or
other correspondence received from the SEC (or comparable agency in any
applicable non-U.S. jurisdiction) concerning any investigation or possible
investigation or other inquiry by such agency regarding financial or other
operational results of any Loan Party or any Subsidiary thereof (other than
comment letters and related correspondence for standard reviews, including but
not limited to SEC reviews of annual reports);

(e)           promptly after the assertion or occurrence thereof, notice of any
action or proceeding against or of any noncompliance by any Loan Party or any of
its Subsidiaries with any Environmental Law or Environmental Permit that would
reasonably be expected to have a Material Adverse Effect; and

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

65

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

Documents required to be delivered pursuant to Section 6.01(a) or (b) or
Section 6.02(b) (to the extent any such documents are included in materials
otherwise filed with the SEC) may be delivered electronically and if so
delivered, shall be deemed to have been delivered on the date (1) on which the
Domestic Borrower posts such documents, or provides a link thereto on the
Domestic Borrower’s website on the Internet at the website address listed on
Schedule 10.02, (2) on which such documents are posted on a publicly available
website maintained by or on behalf of the SEC for access to documents filed in
the EDGAR database (the “EDGAR Website”), or (3) on which such documents are
posted on the Domestic Borrower’s behalf on an Internet or intranet website, if
any, to which each Lender and the Domestic Administrative Agent have access
(whether a commercial, third-party website or whether sponsored by the Domestic
Administrative Agent); provided that (i) the Domestic Borrower shall deliver
paper copies of such documents to the Domestic Administrative Agent, for
delivery by the Domestic Administrative Agent to any Lender that requests the
Domestic Borrower to deliver such paper copies, until a request to cease
delivering paper copies is given by the Domestic Administrative Agent (or by
such Lender to the Domestic Administrative Agent) and (ii) except with respect
to documents posted on the EDGAR Website, the Domestic Borrower shall notify the
Domestic Administrative Agent (by telecopier or electronic mail) of the posting
of any such documents and, if requested by the Domestic Administrative Agent,
provide to the Domestic Administrative Agent by electronic mail electronic
versions (i.e., soft copies) of such documents.  Notwithstanding anything
contained herein, in every instance the Domestic Borrower shall be required to
provide paper copies of the Compliance Certificates required by Section 6.02(a)
to the Domestic Administrative Agent.  Except for such Compliance Certificates,
the Domestic Administrative Agent shall have no obligation to request the
delivery or to maintain copies of the documents referred to above, and in any
event shall have no responsibility to monitor compliance by the Domestic
Borrower with any such request for delivery, and each Lender shall be solely
responsible for requesting delivery to it or maintaining its copies of such
documents.

If additional financial institutions shall be added as Lenders under this
Agreement, the Borrowers hereby acknowledge that (a) the Domestic Administrative
Agent and Canadian Administrative Agent will make available to the Lenders and
the L/C Issuers materials and/or information provided by or on behalf of the
Borrowers hereunder (collectively, “Borrower Materials”) by posting the Borrower
Materials on IntraLinks or another similar electronic system (the “Platform”)
and (b) certain of the Lenders may be “public-side” Lenders (i.e., Lenders that
do not wish to receive material non-public information with respect to the
Borrowers or their securities) (each, a “Public Lender”).  The Borrowers hereby
agree that they will use commercially reasonable efforts to identify that
portion of the Borrower Materials that may be distributed to the Public Lenders
and that (w) all such Borrower Materials shall be clearly and conspicuously
marked “PUBLIC” which, at a minimum, shall mean that the word “PUBLIC” shall
appear prominently on the first page thereof; (x) by marking Borrower Materials
“PUBLIC,” the Borrowers shall be deemed to have authorized the Administrative
Agents, the L/C Issuers and the Lenders to treat such Borrower Materials as not
containing any material non-public information (although it may be sensitive and
proprietary) with respect to the Borrowers or their securities for purposes of
United States Federal and state securities laws (provided, however, that to the
extent such Borrower Materials constitute Information, they shall be treated as
set forth in Section 10.07); (y) all Borrower Materials marked “PUBLIC” are
permitted to be made available through a portion of the Platform designated
“Public Investor”; and (z) the Administrative Agents shall be entitled to treat
any Borrower Materials that are not marked

66

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

“PUBLIC” as being suitable only for posting on a portion of the Platform not
designated “Public Investor.”  Notwithstanding the foregoing, (i) the Borrowers
shall be under no Obligation to mark any Borrower Materials “PUBLIC” and (ii)
for purposes hereof, all Borrower Materials made available through the EDGAR
database or a successor database shall be deemed to be “PUBLIC” and may be
treated as such by the Administrative Agents regardless of whether they have
been marked “PUBLIC”.

6.03        Notices.  Promptly notify the Domestic Administrative Agent:

(a)           of the occurrence of any Default;

(b)           of any matter that has resulted or would reasonably be expected to
result in a Material Adverse Effect, including the following types of events to
the extent any such event would reasonably be expected to result in a Material
Adverse Effect:  (i) breach or non-performance of, or any default under, a
Contractual Obligation of any Loan Party or any Subsidiary thereof; (ii) any
dispute, litigation, investigation, proceeding or suspension between any Loan
Party or any Subsidiary thereof and any Governmental Authority; or (iii) the
commencement of, or any material development in, any litigation or proceeding
affecting any Loan Party or any Subsidiary thereof, including pursuant to any
applicable Environmental Laws;

(c)           of the occurrence of any ERISA Event;

(d)           of any material change in accounting policies or financial
reporting practices by any Loan Party or any Subsidiary thereof; and

(e)           of the determination by the Registered Public Accounting Firm
providing the opinion required under Section 6.01(a) (in connection with its
preparation of such opinion) or the Domestic Borrower’s determination at any
time of the occurrence or existence of any Internal Control Event.

Each notice pursuant to Section 6.03 shall be accompanied by a statement of a
Responsible Officer of the Domestic Borrower setting forth details of the
occurrence referred to therein and stating what action the Domestic Borrower has
taken and proposes to take with respect thereto.  Each notice pursuant to
Section 6.03(a) shall describe with particularity any and all provisions of this
Agreement and any other Loan Document that have been breached.

6.04        Payment of Obligations.  Pay and discharge as or before the same
shall become due and payable, all its (i) tax liabilities, assessments and
governmental charges or levies upon it or its properties or assets, unless the
same are being contested in good faith by appropriate proceedings diligently
conducted and adequate reserves in accordance with GAAP are being maintained by
the Domestic Borrower or such Subsidiary and (ii) other claims and Indebtedness
if nonpayment thereof would reasonably be expected to have a Material Adverse
Effect.

6.05        Preservation of Existence, Etc.  (a)  Preserve, renew and maintain
in full force and effect its legal existence and good standing under the Laws of
the jurisdiction of its organization except in a transaction permitted by
Section 7.04 or 7.05, except that the existence or good standing of any
Subsidiary shall not be required to be maintained to the extent the maintenance
thereof is no longer desirable in the conduct of the business of the Borrowers
and their

67

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

Subsidiaries, or failure to do so would not reasonably be expected to have a
Material Adverse Effect; (b) take all reasonable action to maintain all rights,
privileges, permits, licenses and franchises necessary or desirable in the
normal conduct of its business, except to the extent that failure to do so would
not reasonably be expected to have a Material Adverse Effect; and (c) preserve
or renew all of its registered patents, trademarks, trade names and service
marks, the non-preservation of which would reasonably be expected to have a
Material Adverse Effect.

6.06        Maintenance of Properties.  (a) Maintain, preserve and protect all
of its material properties and equipment necessary in the operation of its
business in working order and condition, ordinary wear and tear excepted; and
(b) make all necessary repairs thereto and renewals and replacements thereof,
except in each case where the failure to do so would not reasonably be expected
to have a Material Adverse Effect.

6.07        Maintenance of Insurance.  Maintain with financially sound and
reputable insurance companies not Affiliates of the Domestic Borrower, insurance
with respect to its properties and business against loss or damage of the kinds
customarily insured against by Persons engaged in the same or similar business,
of such types and in such amounts as are customarily carried under similar
circumstances by such other Persons.

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

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

6.10        Inspection Rights.  Permit representatives and independent
contractors of the Administrative Agents and each Lender to visit and inspect
any of its properties, to examine its corporate, financial and operating
records, and make copies thereof or abstracts therefrom, and to discuss its
affairs, finances and accounts with its directors, officers, and independent
public accountants, all at such reasonable times during normal business hours
and as often as may be reasonably requested, upon reasonable advance notice to
(and, if desired by the Domestic Borrower, in the presence and with the
participation of) the Domestic Borrower; provided, however, that (i) unless an
Event of Default then exists and is continuing, the Loan Parties shall only be
responsible for the costs and expenses of the Administrative Agents in
connection with up to one such visit and inspection per year, and (ii) when an
Event of Default exists the Administrative Agents or any Lender (or any of their
respective representatives or independent contractors) may do any of the
foregoing at the expense of the Domestic Borrower at any time during normal
business hours and without advance notice.

6.11        Use of Proceeds.  Use the proceeds of the Credit Extensions (i) to
refinance existing Indebtedness of the Domestic Borrower and its Subsidiaries
and (ii) for working capital,

68

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

Capital Expenditures and other general corporate purposes, including
acquisitions, dividends and stock repurchases in conformity with all provisions
of this Agreement.

6.12        Covenant to Guarantee Obligations and Give Security.  (a) Upon the
formation or acquisition of any new direct or indirect Subsidiary (other than
any Foreign Subsidiary or a Subsidiary that is held directly or indirectly by a
Foreign Subsidiary) by any Loan Party, then the Domestic Borrower shall, at the
Domestic Borrower’s expense:

(i)            within 45 days after such formation or acquisition, cause such
Subsidiary, and cause each direct and indirect parent of such Subsidiary (if it
has not already done so), to duly execute and deliver to the Domestic
Administrative Agent a guaranty or guaranty supplement, in form and substance
reasonably satisfactory to the Domestic Administrative Agent, guaranteeing the
other Loan Parties’ obligations under the Loan Documents,

(ii)           within 45 days after such formation or acquisition, furnish to
the Domestic Administrative Agent such information regarding the real and
personal properties of such Subsidiary as would have been required under the
Loan Documents had such Subsidiary existed as of the Closing Date,

(iii)          within 45 days after such formation or acquisition, cause such
Subsidiary and each direct and indirect parent of such Subsidiary (if it has not
already done so) to duly execute and deliver Security Agreement Supplements and
amendments to the Pledge Agreement to the Domestic Administrative Agent and
other security and pledge agreements, as specified by and in form and substance
reasonably satisfactory to the Domestic Administrative Agent (including delivery
of all pledged Equity Interests in and of such Subsidiary, and other instruments
of the type specified in Section 4.01(a)(iv)), securing payment of all the
Obligations of such Subsidiary or such parent, as the case may be, under the
Loan Documents,

(iv)          within 45 days after such formation or acquisition, cause such
Subsidiary and each direct and indirect parent of such Subsidiary (if it has not
already done so) to take whatever action reasonably requested by Domestic
Administrative Agent (including the preparation of Uniform Commercial Code
financing statements) that may be necessary or advisable in the reasonable
opinion of the Domestic Administrative Agent to assist the Domestic
Administrative Agent (or in any representative of the Domestic Administrative
Agent designated by it) in obtaining valid and subsisting Liens on the
properties purported to be subject to the Security Agreement Supplements and
security and pledge agreements delivered pursuant to this Section 6.12, and

(v)           within 60 days after such formation or acquisition, deliver to the
Domestic Administrative Agent, upon the request of the Domestic Administrative
Agent in its sole discretion, a signed copy of a favorable opinion, addressed to
the Domestic Administrative Agent and the other Secured Parties, of counsel for
the Loan Parties acceptable to the Domestic Administrative Agent as to such
matters relating to such Subsidiary as the Domestic Administrative Agent may
reasonably request.

69

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

(b)           Upon the acquisition of any item of personal property with the
fair market value in excess of $2,000,000 individually by any Loan Party, if
such property, in the judgment of the Domestic Administrative Agent, shall not
already be subject to a perfected security interest in favor of the Domestic
Administrative Agent for the benefit of the Secured Parties as required pursuant
to the Loan Documents, then the Domestic Borrower shall, at the Domestic
Borrower’s expense:

(i)            within 45 days after such acquisition, furnish to the
Administrative Agent a description of the property so acquired in detail
reasonably satisfactory to the Administrative Agent that would have been
required under the Loan Documents had such property been owned as of the Closing
Date,

(ii)           within 45 days after such acquisition, cause the applicable Loan
Party to duly execute and deliver Security Agreement Supplements to the Domestic
Administrative Agent and other security and pledge agreements, as specified by
and in form and substance reasonably satisfactory to the Domestic Administrative
Agent, securing payment of all the Obligations of the applicable Loan Party
under the Loan Documents and constituting Liens on all such properties, and

(iii)          within 45 days after such acquisition, cause the applicable Loan
Party to take whatever action reasonably requested by the Domestic
Administrative Agent (including the preparation of Uniform Commercial Code
financing statements) that may be necessary or advisable in the reasonable
opinion of the Domestic Administrative Agent to assist the Domestic
Administrative Agent (or in any representative of the Domestic Administrative
Agent designated by it) in obtaining valid and subsisting Liens on such
property.

(c)           Upon the request of the Domestic Administrative Agent following
the occurrence and during the continuance of a Default, the Domestic Borrower
shall, at the Domestic Borrower’s expense:

(i)            within 30 days after such request, furnish to the Domestic
Administrative Agent a description of the material real and personal properties
of the Loan Parties and their respective Subsidiaries in detail reasonably
satisfactory to the Domestic Administrative Agent,

(ii)           within 30 days after such request, duly execute and deliver, and
cause each Subsidiary (other than any Foreign Subsidiary or a Subsidiary that is
held directly or indirectly by a Foreign Subsidiary) of the Domestic Borrower
(if it has not already done so) to duly execute and deliver Security Agreement
Supplements to the Domestic Administrative Agent and other security and pledge
agreements, as specified by and in form and substance reasonably satisfactory to
the Domestic Administrative Agent (including delivery of all pledged Equity
Interests in and of such Subsidiary, and other instruments of the type specified
in Section 4.01(a)(iv)), securing payment of all the Obligations of such
Subsidiary under the Loan Documents and constituting Liens on all such
properties,

70

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

(iii)          within 30 days after such request, take, and cause each
Subsidiary (other than any Foreign Subsidiary or a Subsidiary that is held
directly or indirectly by a Foreign Subsidiary) of the Domestic Borrower to
take, whatever action requested by the Domestic Administrative Agent (including
the filing of Uniform Commercial Code financing statements) that may be
necessary or advisable in the reasonable opinion of the Domestic Administrative
Agent to vest in the Domestic Administrative Agent (or in any representative of
the Domestic Administrative Agent designated by it) valid and subsisting Liens
on the properties purported to be subject to the Security Agreement Supplements
and security and pledge agreements delivered pursuant to this Section 6.12, and

(iv)          within 60 days after such request, deliver to the Domestic
Administrative Agent, upon the request of the Domestic Administrative Agent in
its sole discretion, a signed copy of a favorable opinion, addressed to the
Domestic Administrative Agent and the other Secured Parties, of counsel for the
Loan Parties acceptable to the Domestic Administrative Agent as to the matters
contained in clauses (ii) and (iii) above, and as to such other matters as the
Domestic Administrative Agent may reasonably request.

(d)           At any time upon request of the Domestic Administrative Agent,
promptly execute and deliver any and all further instruments and documents and
take all such other action as the Domestic Administrative Agent may reasonably
deem necessary or desirable in obtaining the full benefits of, or (as
applicable) in perfecting and preserving the Liens of, such guaranties, Security
Agreement Supplements and other security and pledge agreements.

Notwithstanding anything to the contrary in this Agreement or any other Loan
Document, (i) not more than 65% of the Equity Interests of a first-tier Foreign
Subsidiary shall be required to be pledged pursuant to any of the Loan
Documents, (ii) in no event shall any Foreign Subsidiary, any direct or indirect
Subsidiary of a Foreign Subsidiary, or any of Guess? Royalty Finance LLC, Guess?
Licensing, Inc., Guess? IP GP LLC, Guess? IP LP LLC or Guess? IP Holder L.P. or
any other Subsidiary formed for a similar purpose in connection with a permitted
refinancing of the Senior Notes be required to become a Guarantor, nor shall any
security interest be required to be granted with respect to any assets of
(including Equity Interests) of any such Person pursuant to the Loan Documents,
and (iii) assets (including Equity Interests) shall be excluded from the
requirements of this Section 6.12 to the extent the Domestic Administrative
Agent reasonably determines that the cost of obtaining or perfecting a security
interest in such assets is excessive in relation to the benefit expected to be
afforded to the Lenders thereby.

6.13        Compliance with Environmental Laws.  Comply, and cause all lessees
and other Persons operating or occupying its properties to comply, in all
material respects, with all applicable Environmental Laws and Environmental
Permits; obtain and renew all Environmental Permits necessary for its operations
and properties; and conduct any investigation, study, sampling and testing, and
undertake any cleanup, removal, remedial or other action necessary to remove and
clean up all Hazardous Materials from any of its properties, in accordance with
the requirements of all Environmental Laws; provided, however, that neither the
Domestic Borrower nor any of its Subsidiaries shall be required to undertake any
such cleanup, removal, remedial or other action to the extent that its
obligation to do so is being contested in good faith and by

71

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

proper proceedings and appropriate reserves are being maintained with respect to
such circumstances in accordance with GAAP.

6.14        Further Assurances.  Promptly upon reasonable request by the
Domestic Administrative Agent, or any Lender through the Domestic Administrative
Agent, (a) correct any material defect or error that may be discovered in any
Loan Document or in the execution, acknowledgment, filing or recordation
thereof, and (b) do, execute, acknowledge, deliver, record, re-record, file,
re-file, register and re-register any and all such further acts, deeds,
certificates, assurances and other instruments as the Domestic Administrative
Agent, or any Lender through the Domestic Administrative Agent, may reasonably
require from time to time in order to (i) carry out more effectively the
purposes of the Loan Documents, (ii) to the fullest extent permitted by
applicable law, subject any Loan Party’s or any of its Subsidiaries’ personal
property to the Liens now or hereafter intended to be covered by any of the
Collateral Documents, (iii) perfect and maintain the validity, effectiveness and
priority of any of the Collateral Documents and any of the Liens intended to be
created thereunder and (iv) assure, convey, grant, assign, transfer, preserve,
protect and confirm more effectively unto the Secured Parties the rights granted
or now or hereafter intended to be granted to the Secured Parties under any Loan
Document or under any other instrument executed in connection with any Loan
Document to which any Loan Party or any of its Subsidiaries is or is to be a
party, and cause each of its Subsidiaries to do so.

6.15        Compliance with Terms of Leaseholds.  Make all payments and
otherwise perform all obligations in respect of all leases of real property to
which either Borrower or any of their Subsidiaries is a party, keep such leases
in full force and effect and not allow such leases to lapse or be terminated or
any rights to renew such leases to be forfeited or cancelled, notify the
Domestic Administrative Agent of any default by any party with respect to any
leases that are material to the business of either Borrower or any of their
Subsidiaries and cooperate with the Domestic Administrative Agent in all
respects to cure any such default, and cause each of its Subsidiaries to do so,
except, in any case, where the failure to do so, either individually or in the
aggregate, could not be reasonably likely to have a Material Adverse Effect.

6.16        Cash Collateral Accounts.  To the extent cash collateral is required
to be maintained in any of the Lenders’ or Agents’ possession under the terms of
any Loan Document, maintain, and cause each of the other Loan Parties to
maintain, all Cash Collateral Accounts with respect thereto with Bank of America
or another commercial bank located in the United States, which has accepted the
assignment of such accounts to the Domestic Administrative Agent for the benefit
of the Secured Parties pursuant to the terms of the Security Agreement.

ARTICLE VII
NEGATIVE COVENANTS

So long as any Lender shall have any Commitment hereunder, any Loan or other
Obligation hereunder shall remain unpaid or unsatisfied, or any Letter of Credit
shall remain outstanding and not cash collateralized or otherwise supported in a
manner acceptable to the Domestic Administrative Agent, the Domestic Borrower
shall not, nor shall it permit any Subsidiary to, directly or indirectly:

72

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

7.01        Liens.  Create, incur, assume or suffer to exist any Lien upon any
of its property, assets or revenues, whether now owned or hereafter acquired, or
sign or file or suffer to exist under the Uniform Commercial Code of any
jurisdiction a financing statement that names the Domestic Borrower or any of
its Subsidiaries as debtor, or assign any accounts or other right to receive
income, other than the following:

(a)           Liens pursuant to any Loan Document;

(b)           Liens existing on the Closing Date and listed on Schedule 7.01 and
any renewals or extensions thereof, provided that, except with respect to Liens
on accounts receivable of Foreign Subsidiaries as described on Schedule 7.01,
(i) the property covered thereby is not changed, (ii) the amount secured or
benefited thereby is not increased except as permitted by Section 7.02, (iii)
the direct or any contingent obligor with respect thereto is not changed, and
(iv) any renewal or extension of the obligations secured or benefited thereby is
permitted by Section 7.02(e);

(c)           Liens for Taxes not yet due or which are being contested in good
faith and by appropriate proceedings diligently conducted, if adequate reserves
with respect thereto are maintained on the books of the applicable Person in
accordance with GAAP;

(d)           carriers’, warehousemen’s, mechanics’, materialmen’s, repairmen’s
or other like Liens arising in the ordinary course of business;

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

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

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

(h)           Liens securing judgments for the payment of money not constituting
an Event of Default under Section 8.01(h);

(i)            Liens securing Indebtedness permitted under Section 7.02(g)(ii);
provided that (i) such Liens do not at any time encumber any property other than
the property financed by such Indebtedness and (ii) the Indebtedness secured
thereby does not exceed the cost or fair market value, whichever is lower, of
the property being acquired on the date of acquisition;

(j)            Liens securing obligations permitted under Sections 7.02(a)(ii),
(iii) and (iv), and 7.02(j) and (k);

(k)           Liens securing Indebtedness permitted under Section 7.02(b);

73

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

(l)            mortgages on real property, so long as recourse thereunder is
limited to the property subject to such Mortgage;

(m)          any interest or title of a licensee or licensor under any license
entered into by the Domestic Borrower or any of its Subsidiaries in the ordinary
course of business; and

(n)           other Liens securing Indebtedness outstanding in an aggregate
principal amount not to exceed $10,000,000; provided that no such Lien shall
extend to or cover (i) any Collateral or (ii) to the extent such Lien covers
Collateral, any property other than the property financed by such Indebtedness.

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

(a)           obligations (contingent or otherwise) existing or arising under
(i) any Swap Contract, provided that such obligations are (or were) entered into
by such Person in the ordinary course of business for the purpose of directly
mitigating risks associated with fluctuations in interest rates, prices of
commodities or foreign exchange rates, (ii) obligations existing or arising
under any Secured Hedge Agreements, (iii) obligations existing or arising under
any Secured Cash Management Agreements and (iv) obligations existing or arising
under any Secured Foreign Exchange Agreements;

(b)           Indebtedness evidenced by the Senior Notes and any refinancings,
refundings, renewals or extensions thereof consisting of Indebtedness of the
same type on similar terms (except as to maturity date, interest rates and the
like); provided that (i) the amount of such Indebtedness is not increased at the
time of such refinancing, refunding, renewal or extension to an aggregate
principal amount of more than $75,000,000 (plus an amount equal to a reasonable
premium or other reasonable amount paid, and fees and expenses reasonably
incurred, in connection with such refinancing) and (ii) the direct or any
contingent obligor with respect thereto is not changed as a result of or in
connection with such refinancing, refunding, renewal or extension to include any
Loan Party, unless such refinancing, refunding, renewal or extension includes
only unsecured Indebtedness;

(c)           Indebtedness otherwise permitted under Section 7.03;

(d)           Indebtedness under the Loan Documents;

(e)           Capital Leases, letters of credit and guaranties related to such
letters of credit outstanding on the Closing Date and listed on Schedule 7.02
and as to Capital Leases only, any refinancings, refundings, renewals or
extensions thereof; provided that the amount of such Capital Leases is not
increased at the time of such refinancing, refunding, renewal or extension
except by an amount equal to a reasonable premium or other reasonable amount
paid, and fees and expenses reasonably incurred, in connection with such
refinancing and by an amount equal to any existing commitments unutilized
thereunder and the direct or any contingent obligor with respect thereto is not
changed, as a result of or in connection with such refinancing, refunding,
renewal or extension;

(f)            Guarantees of the Borrower or any Subsidiary in respect of
Indebtedness otherwise permitted hereunder of the Borrower or any wholly owned
Subsidiary;

74

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

(g)           (i) unsecured Indebtedness and (ii) other Indebtedness, which may
be secured to the extent such security interest is permitted under Section 7.01;
provided, however, that the aggregate amount of all such Indebtedness permitted
under this clause (g) at any one time outstanding shall not exceed $35,000,000;

(h)           Indebtedness in respect of surety and appeal bonds, performance
bonds and other obligations of a like nature incurred in the ordinary course of
business;

(i)            guaranties of operating leases by the Domestic Borrower to, or
for the benefit of, its Domestic Subsidiaries in the ordinary course of the
Domestic Borrower’s business;

(j)            Indebtedness of the Domestic Borrower consisting of a Capital
Lease or Synthetic Lease (or Indebtedness related thereto) in connection with
the acquisition of an aircraft, in an aggregate amount not to exceed
$20,000,000; and

(k)           other Indebtedness of Foreign Subsidiaries in an aggregate amount
not to exceed $50,000,000.

7.03        Investments.  Make or hold any Investments, except:

(a)           Investments held by the Domestic Borrower and its Subsidiaries in
the form of Cash Equivalents;

(b)           advances to officers, directors and employees of the Domestic
Borrower and Subsidiaries in an aggregate amount not to exceed $3,000,000 at any
time outstanding, for travel, entertainment, relocation and analogous ordinary
business purposes or for the purchase of Equity Interests of the Domestic
Borrower by such officers, directors and employees not prohibited by
Section 7.06;

(c)           (i) Investments by the Domestic Borrower and its Subsidiaries in
each other or any of their respective Subsidiaries, and (ii) Investments in
minority Equity Interests held by the Domestic Borrower and its Subsidiaries in
Persons organized under the laws of any jurisdiction other than a political
subdivision of the United States in an aggregate amount not to exceed
$50,000,000;

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

(e)           Guarantees permitted by Section 7.02;

(f)            Investments existing on the Closing Date and set forth on
Schedule 7.03;

(g)           Investments by the Domestic Borrower in Swap Contracts, Secured
Cash Management Agreements and Secured Foreign Exchange Agreements permitted
under Section 7.02(a);

75

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

(h)           the purchase or other acquisition of all of the Equity Interests
in, or all or a substantial part of the property of, any Person, or of any
business unit of a Person, that, upon the consummation thereof, will be
wholly-owned directly by the Domestic Borrower or one or more of its
wholly-owned Subsidiaries (including as a result of a merger or consolidation);
provided that, with respect to each purchase or other acquisition made pursuant
to this Section 7.03(h):

(i)            any such newly-created or acquired Subsidiary shall comply with
the requirements of Section 6.12;

(ii)           after giving effect to such acquisition, the Domestic Borrower
shall be in compliance with Section 7.07;

(iii)          such purchase or other acquisition shall not include or result in
any contingent liabilities that would reasonably be expected to result in a
Material Adverse Effect (as determined in good faith by the board of directors
(or the persons performing similar functions) of the Domestic Borrower or such
Subsidiary if the board of directors is otherwise approving such transaction
and, in each other case, by a Responsible Officer);

(iv)          the total cash and noncash consideration (including the fair
market value of all Equity Interests issued or transferred to the sellers
thereof, all indemnities, earnouts and other contingent payment obligations to,
and the aggregate amounts paid or to be paid under noncompete, consulting and
other affiliated agreements with, the sellers thereof, all write-downs of
property and reserves for liabilities with respect thereto and all assumptions
of debt, liabilities and other obligations in connection therewith) paid by or
on behalf of the Domestic Borrower and its Subsidiaries for any such purchase or
other acquisition, when aggregated with the total cash and noncash consideration
paid by or on behalf of the Domestic Borrower and its Subsidiaries for all other
purchases and other acquisitions made by the Domestic Borrower and its
Subsidiaries pursuant to this Section 7.03(h), shall not exceed $150,000,000
from and after the Closing Date and the total cash consideration paid by or on
behalf of the Domestic Borrower and its Subsidiaries for any such purchase or
other acquisition, when aggregated with the total cash consideration paid by or
on behalf of the Domestic Borrower and its Subsidiaries for all other purchases
and other acquisitions made pursuant to this Section 7.03(h), shall not exceed
$125,000,000 from and after the Closing Date;

(v)           the Domestic Borrower shall have delivered to the Domestic
Administrative Agent, at least three Business Days prior to the date on which
any such purchase or other acquisition is to be consummated, a certificate of a
Responsible Officer, in form and substance reasonably satisfactory to the
Domestic Administrative Agent and the Required Lenders, certifying that all of
the requirements set forth in this Section 7.03(h) have been satisfied or will
be satisfied on or prior to the consummation of such purchase or other
acquisition;

(i)            the endorsement of instruments for collection or deposit in the
ordinary course of business;

76

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

(j)            investments in respect to any publicly traded securities, which
public securities are traded in a nationally recognized stock exchange
association, and which investment shall not, when taken together with
investments in public securities by the other Loan Parties, exceed $4,000,000 in
the aggregate at any one time (valued at original cost) plus the amount of
proceeds from the sale of such publicly traded securities;

(k)           stock or obligations issued to any Borrower by any Person (or the
representative of such Person) in respect of Indebtedness of such Person owing
to such Borrower in connection with the insolvency, bankruptcy, receivership or
reorganization of such Person or a composition or readjustment of the debts of
such Person; provided, that the original of any such stock or instrument
evidencing such obligations shall be promptly delivered to the Domestic
Administrative Agent for the benefit of the Lenders, upon the Domestic
Administrative Agent’s request, together with such stock power, assignment or
endorsement by Borrowers as the Domestic Administrative Agent may request; and

(l)            other Investments by the Domestic Borrower and its Subsidiaries
in Persons organized under the laws of a political subdivision of the United
States, in an amount not exceeding $35,000,000 in the aggregate from and after
the Closing Date.

7.04        Fundamental Changes.  Merge, dissolve, liquidate, consolidate with
or into another Person, or Dispose of (whether in one transaction or in a series
of transactions) all or substantially all of its assets (whether now owned or
hereafter acquired) to or in favor of any Person, except that, so long as no
Default exists or would result therefrom:

(a)           any Domestic Subsidiary may merge with (i) the Domestic Borrower,
provided that the Domestic Borrower shall be the continuing or surviving Person,
or (ii) any one or more other Domestic Subsidiaries, provided that when any
wholly-owned Domestic Subsidiary is merging with another Domestic Subsidiary,
such wholly-owned Subsidiary shall be the continuing or surviving Person;

(b)           any Canadian Subsidiary may merge with (i) the Canadian Borrower,
provided that the Canadian Borrower shall be the continuing or surviving Person,
or (ii) any one or more other Canadian Subsidiaries, provided that when any
wholly-owned Canadian Subsidiary is merging with another Canadian Subsidiary,
such wholly-owned Subsidiary shall be the continuing or surviving Person;

(c)           any Loan Party may Dispose of all or substantially all of its
assets (upon voluntary liquidation or otherwise) to a Borrower or to another
Loan Party provided that if the seller in such a transaction is a wholly-owned
Subsidiary, then the purchaser must also be a wholly-owned Subsidiary, and
provided, further, that no Guarantor that is a Domestic Subsidiary may sell all
or substantially all of its assets (upon voluntary liquidations or otherwise) to
a Canadian Subsidiary or Foreign Subsidiary;

(d)           any Subsidiary that is not a Loan Party may Dispose of all or
substantially all its assets (including any Disposition that is in the nature of
a liquidation) to, or may merge with, (i) another Subsidiary that is not a Loan
Party or (ii) a Loan Party, provided that such Loan Party is the surviving
entity in any such merger;

77

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

(e)           in connection with any acquisition permitted under Section 7.03,
any Subsidiary of the Domestic Borrower may merge into or consolidate with any
other Person or permit any other Person to merge into or consolidate with it;
provided that (i) the Person surviving such merger shall be a wholly-owned
Subsidiary of the Domestic Borrower and (ii) in the case of any such merger to
which any Loan Party (other than the Domestic Borrower) is a party, such Loan
Party is the surviving Person; and

(f)            the Foreign Subsidiary Restructuring may be consummated in
accordance with the definition thereof.

7.05        Dispositions.  Make any Disposition or enter into any agreement to
make any Disposition, except:

(a)           Dispositions of obsolete, surplus or worn out property, whether
now owned or hereafter acquired, in the ordinary course of business;

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

(c)           Dispositions of equipment or real property to the extent that (i)
such property is exchanged for credit against the purchase price of similar
replacement property or (ii) the proceeds of such Disposition are reasonably
promptly applied to the purchase price of such replacement property;

(d)           Dispositions of property by any Subsidiary to a Borrower or to a
wholly-owned Subsidiary; provided that if the transferor of such property is a
Guarantor, the transferee thereof must either be a Borrower or a Guarantor;

(e)           Dispositions permitted by Section 7.04;

(f)            licensing by any Borrower of any of its intellectual property, in
the ordinary course of its business; provided that such licenses are granted for
fair market value in the reasonable judgment of the Domestic Borrower;

(g)           sales of Cash Equivalents, as provided under Section 7.03(a);

(h)           sales of any publicly traded securities owned by any Loan Party,
to the extent such ownership was permitted under Section 7.03(j);

(i)            transfers of assets to the extent required by the terms of the
documents related to the Senior Notes;

(j)            a Disposition consisting of a sale-leaseback transaction in
connection with the acquisition of an aircraft; provided that the aggregate
amount thereof, together with the amount of any Indebtedness pursuant to
Section 7.02(j), shall not exceed $20,000,000;

(k)           transfers by the Domestic Borrower and its Subsidiaries of any
intellectual property to the Domestic Borrower or any of its Subsidiaries;

78

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

(l)            Dispositions of artwork with an aggregate net book value of not
more than $6,000,000; and

(m)          Dispositions by the Domestic Borrower and its Subsidiaries not
otherwise permitted under this Section 7.05; provided that (i) at the time of
such Disposition, no Default shall exist or would result from such Disposition
and (ii) the aggregate book value of all property Disposed of in reliance on
this clause (f) from and after the Closing Date shall not exceed $35,000,000;

provided, however, that any Disposition pursuant to Section 7.05(a) through
Section 7.05(i) shall be for fair market value.

7.06        Restricted Payments.  Declare or make, directly or indirectly, any
Restricted Payment, or incur any obligation (contingent or otherwise) to do so,
or issue or sell any Equity Interests or accept any capital contributions,
except that, so long as no Default shall have occurred and be continuing at the
time of any action described below or would result therefrom:

(a)           each Subsidiary may make Restricted Payments to the Borrowers, any
Subsidiaries of the Domestic Borrower that are Guarantors and any other Person
that owns a direct Equity Interest in such Subsidiary, ratably according to
their respective holdings of the type of Equity Interest in respect of which
such Restricted Payment is being made;

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

(c)           the Domestic Borrower may make Restricted Payments so long as
immediately after giving effect thereto it shall be in pro forma compliance with
the covenant set forth in Section 7.11(b);

(d)           the Domestic Borrower may issue and sell its Equity Interests;
provided, that such sale of Equity Interests does not result in any Change of
Control; and

(e)           the Domestic Borrower may declare and make dividend payments and
may repurchase any of its issued and outstanding Equity Interests, so long as
immediately after giving effect thereto the aggregate amount of unrestricted
cash and Cash Equivalents held by the Borrowers is at least $50,000,000.

7.07        Change in Nature of Business.  Engage in any material line of
business substantially different from those lines of business conducted by the
Domestic Borrower and its Subsidiaries on the date hereof or any business
reasonably related or ancillary, complimentary, or incidental thereto.

7.08        Transactions with Affiliates.  Enter into any transaction of any
kind with any Affiliate of the Domestic Borrower, whether or not in the ordinary
course of business, other than (i) transactions that in the reasonable judgment
of the Domestic Borrower are on fair and reasonable terms substantially as
favorable to such Borrower or such Subsidiary as would be obtainable by such
Borrower or such Subsidiary at the time in a comparable arm’s length

79

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

transaction with a Person other than an Affiliate, (ii) transactions with
Affiliates in existence on the Closing Date and any extensions thereof on the
terms substantially similar or at least equally favorable to the Borrowers and
set forth on Schedule 7.08, (iii) leases of real property from Affiliates of the
Domestic Borrower, the terms of which are approved by the board of directors of
the relevant Borrower or Subsidiary, (iv) transactions relating to any
shareholders agreement to which the Domestic Borrower is a party from time to
time, (v) payments of reasonable compensation to officers, employees and
directors for services rendered in the ordinary course of business, (vi)
payments of expenses or the making of loans and advances to officers, employees
and directors for business purposes consistent with past practice, including but
not limited to indemnification permitted under the Borrower’s organizational
documents, relocation, stock option exercises, travel or otherwise, (vii) the
Foreign Subsidiary Restructuring, and (viii) transactions among any Borrower and
any of its direct or indirect parents or Subsidiaries not involving any other
Affiliate.

7.09        Burdensome Agreements.  Enter into or permit to exist any
Contractual Obligation (other than this Agreement or any other Loan Document),
except for those agreements set forth on Schedule 7.09, that (a) limits the
ability (i) of any Subsidiary to make Restricted Payments to the Domestic
Borrower or any Guarantor or to otherwise transfer property to or invest in the
Domestic Borrower or any Guarantor (other than customary restrictions in
connection with agreements to make Dispositions permitted under this Agreement,
and agreements in existence at the time any Subsidiary becomes a Subsidiary of
the Domestic Borrower, so long as such agreement was not entered into solely in
contemplation of such Person becoming a Subsidiary of the Domestic Borrower),
(ii) of any Domestic Subsidiary to Guarantee the Indebtedness of the Borrowers
or (iii) of the Domestic Borrower or any Subsidiary to create, incur, assume or
suffer to exist Liens on property of such Person; provided, however, that this
clause (iii) shall not prohibit any negative pledge incurred or provided in
favor of any holder of Indebtedness permitted under Section 7.02(g)(ii) solely
to the extent any such negative pledge relates to the property financed by or
the subject of such Indebtedness; or (b) requires the grant of a Lien to secure
an obligation of such Person if a Lien is granted to secure another obligation
of such Person.

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

7.11        Financial Covenants.

(a)           Total Adjusted Leverage Ratio.  Permit the Total Adjusted Leverage
Ratio for the four fiscal quarter period ending as of the last day of any fiscal
quarter during any period of the Domestic Borrower and its Subsidiaries set
forth below to be greater than the ratio set forth below opposite such period:

80

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

 

Four Fiscal Quarters Ending

 

Maximum Total
Adjusted Leverage Ratio

Closing Date through the last day of the first fiscal quarter of fiscal year
2009

 

 

4.50 to 1.00

The second fiscal quarter of fiscal year 2009 and each fiscal quarter thereafter

 

 

4.25 to 1.00

 

(b)           Consolidated Fixed Charge Coverage Ratio.  Permit the Consolidated
Fixed Charge Coverage Ratio for the four fiscal quarter period ending as of the
last day of any fiscal quarter of the Domestic Borrower and its Subsidiaries to
be less than the ratio set forth below opposite such fiscal quarter:

Four Fiscal Quarters Ending

 

Minimum Fixed
Charge Coverage Ratio

Closing Date through the last day of the first fiscal quarter of fiscal year
2009

 

 

1.10 to 1.00

The second fiscal quarter of fiscal year 2009 and each fiscal quarter thereafter

 

 

1.20 to 1.00

 

7.12        Amendments of Organization Documents.  Amend any of its Organization
Documents in any manner that is materially adverse to the Lenders, except for
(i) changes in its fiscal year and (ii) changes to Organization Documents of any
Subsidiary that is not a Loan Party.

7.13        Accounting Changes.  Make any change in accounting policies or
reporting practices, except as required or permitted by GAAP or except for
changes in fiscal year.

ARTICLE VIII
EVENTS OF DEFAULT AND REMEDIES

8.01        Events of Default.  Any of the following shall constitute an Event
of Default:

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

(b)           Specific Covenants.  The Domestic Borrower fails to perform or
observe any term, covenant or agreement contained in any of Section 6.01, 6.02,
6.03, 6.05, 6.10, 6.11 or 6.12 or Article VII; or

(c)           Other Defaults.  Any Loan Party fails to perform or observe any
other covenant or agreement (not specified in Section 8.01(a) or (b) above)
contained in any Loan Document on its part to be performed or observed and such
failure continues for 30 days after becoming aware of such failure; or

81

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

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

(e)           Cross-Default.  (i) Any Loan Party or any Subsidiary thereof (A)
fails to make any payment when due (whether by scheduled maturity, required
prepayment, acceleration, demand, or otherwise) in respect of any Indebtedness
or Guarantee (other than Indebtedness hereunder and Indebtedness under Swap
Contracts) having an aggregate principal amount (including undrawn committed or
available amounts and including amounts owing to all creditors under any
combined or syndicated credit arrangement) of more than the Threshold Amount, or
(B) fails to observe or perform any other agreement or condition relating to any
such Indebtedness or Guarantee or contained in any instrument or agreement
evidencing, securing or relating thereto, or any other event occurs, the effect
of which default or other event is to cause, or to permit the holder or holders
of such Indebtedness or the beneficiary or beneficiaries of such Guarantee (or a
trustee or agent on behalf of such holder or holders or beneficiary or
beneficiaries) to cause, with the giving of notice if required, such
Indebtedness to be demanded or to become due or to be repurchased, prepaid,
defeased or redeemed (automatically or otherwise), or an offer to repurchase,
prepay, defease or redeem such Indebtedness to be made, prior to its stated
maturity, or such Guarantee to become payable or cash collateral in respect
thereof to be demanded; or (ii) there occurs under any Swap Contract an Early
Termination Date (as defined in such Swap Contract) resulting from (A) any event
of default under such Swap Contract as to which a Loan Party or any Subsidiary
thereof is the Defaulting Party (as defined in such Swap Contract) or (B) any
Termination Event (as so defined) under such Swap Contract as to which a Loan
Party or any Subsidiary thereof is an Affected Party (as so defined) and, in
either event, the Swap Termination Value owed by such Loan Party or such
Subsidiary as a result thereof is greater than the Threshold Amount; or

(f)            Insolvency Proceedings, Etc.  Any Loan Party or any Subsidiary
thereof institutes or consents to the institution of any proceeding under any
Debtor Relief Law, or makes an assignment for the benefit of creditors; or
applies for or consents to the appointment of any receiver, trustee, custodian,
conservator, liquidator, rehabilitator or similar officer for it or for all or
any material part of its property; or any receiver, trustee, custodian,
conservator, liquidator, rehabilitator or similar officer is appointed without
the application or consent of such Person and the appointment continues
undischarged or unstayed for 60 calendar days; or any proceeding under any
Debtor Relief Law relating to any such Person or to all or any material part of
its property is instituted without the consent of such Person and continues
undismissed or unstayed for 60 calendar days, or an order for relief is entered
in any such proceeding; or

(g)           Inability to Pay Debts; Attachment.  (i) Any Loan Party or any
Subsidiary thereof becomes unable or admits in writing its inability or fails
generally to pay its debts as they become due, or (ii) any writ or warrant of
attachment or execution or similar process is issued or levied against all or
any material part of the property of any such Person and is not released,
vacated or fully bonded within 30 days after its issue or levy; or

82

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

(h)           Judgments.  There is entered against any Loan Party or any
Subsidiary thereof (i) one or more final judgments or orders for the payment of
money in an aggregate amount (as to all such judgments and orders within any
twelve-month period) exceeding the Threshold Amount (to the extent not covered
by independent third-party insurance as to which the insurer does not dispute
coverage), or (ii) any one or more non-monetary final judgments that have, or
would reasonably be expected to have, individually or in the aggregate, a
Material Adverse Effect and, in either case, (A) enforcement proceedings are
commenced by any creditor upon such judgment or order, or (B) there is a period
of 15 consecutive days during which a stay of enforcement of such judgment, by
reason of a pending appeal or otherwise, is not in effect; or

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

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

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

(l)            Collateral Documents.  Any Collateral Document after delivery
thereof pursuant to Section 4.01 or 6.12 shall for any reason (other than
pursuant to the terms thereof) cease to create a valid and perfected
first-priority Lien (subject to Liens permitted by Section 7.01) on any material
portion of the Collateral purported to be covered thereby.

8.02        Remedies upon Event of Default.  If any Event of Default occurs and
is continuing, the Administrative Agents shall, at the request of, or may, with
the consent of, the Required Lenders, take any or all of the following actions:

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

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

83

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

(c)           require that the Borrowers Cash Collateralize the L/C Obligations
(in an amount equal to the then Outstanding Amount thereof); and

(d)           exercise on behalf of themselves, the Lenders and the L/C Issuers
all rights and remedies available to them, the Lenders and the L/C Issuers under
the Loan Documents;

provided, however, that upon the occurrence of an entry of an order for relief
with respect to a Borrower under any Debtor Relief Laws, the obligation of each
Lender to make Loans and any obligation of each L/C Issuer to make L/C Credit
Extensions shall automatically terminate, the unpaid principal amount of all
outstanding Loans and all interest and other amounts as aforesaid shall
automatically become due and payable, and the obligation of the Borrowers to
Cash Collateralize the L/C Obligations as aforesaid shall automatically become
effective, in each case without further act of the Administrative Agents or any
Lender.

8.03        Application of Funds.  After the exercise of remedies provided for
in Section 8.02 (or after the Loans have automatically become immediately due
and payable and the L/C Obligations have automatically been required to be Cash
Collateralized as set forth in the proviso to Section 8.02), any amounts
received on account of the Obligations shall be applied by the Administrative
Agents in the following order:

First, to payment of that portion of the Obligations constituting fees,
indemnities, expenses and other amounts (including fees, charges and
disbursements of counsel to the Administrative Agents and amounts payable under
Article III) payable to the Administrative Agents in their capacity as such;

Second, to payment of that portion of the Obligations constituting fees,
indemnities and other amounts (other than principal, interest and Letter of
Credit Fees) payable to the Lenders and the L/C Issuers (including fees, charges
and disbursements of counsel to the respective Lenders and the L/C Issuers and
amounts payable under Article III, ratably among them in proportion to the
respective amounts described in this clause Second payable to them;

Third, to payment of that portion of the Obligations constituting accrued and
unpaid Letter of Credit Fees and interest on the Loans, L/C Borrowings and other
Obligations, ratably among the Lenders and the L/C Issuers in proportion to the
respective amounts described in this clause Third payable to them;

Fourth, to payment of that portion of the Obligations constituting unpaid
principal of the Loans, L/C Borrowings and amounts owing under Secured Hedge
Agreements, Secured Cash Management Agreements and Secured Foreign Exchange
Agreements, ratably among the Lenders, the L/C Issuers, the Hedge Banks, the
Cash Management Banks and the Lenders party to the Secured Foreign Exchange
Agreements in proportion to the respective amounts described in this clause
Fourth held by them;

Fifth, to the Administrative Agents for the account of the L/C Issuers, to Cash
Collateralize that portion of L/C Obligations comprised of the aggregate undrawn
amount of Letters of Credit; and

84

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

Last, the balance, if any, after all of the Obligations have been indefeasibly
paid in full, to the Borrowers or as otherwise required by Law.

Subject to Section 2.03(c), amounts used to Cash Collateralize the aggregate
undrawn amount of Letters of Credit pursuant to clause Fifth above shall be
applied to satisfy drawings under such Letters of Credit as they occur. If any
amount remains on deposit as Cash Collateral after all Letters of Credit have
either been fully drawn or expired, such remaining amount shall be applied to
the other Obligations, if any, in the order set forth above.

ARTICLE IX
ADMINISTRATIVE AGENTS

9.01        Appointment and Authority.  (a) Each of the Domestic Lenders and the
Domestic L/C Issuer hereby irrevocably appoints Bank of America to act on its
behalf as the Domestic Administrative Agent hereunder and under the other Loan
Documents and authorizes the Domestic Administrative Agent to take such actions
on its behalf and to exercise such powers as are delegated to the Domestic
Administrative Agent by the terms hereof or thereof, together with such actions
and powers as are reasonably incidental thereto. Each of the Canadian Lenders
and the Canadian L/C Issuer hereby irrevocably appoints Bank of America Canada
to act on its behalf as the Canadian Administrative Agent hereunder and under
the other Loan Documents and authorizes the Canadian Administrative Agent to
take such actions on its behalf and to exercise such powers as are delegated to
the Canadian Administrative Agent by the terms hereof or thereof, together with
such actions and powers as are reasonably incidental thereto. The provisions of
this Article are solely for the benefit of the Administrative Agents, the
Lenders and the L/C Issuers, and the Borrowers shall not have rights as a third
party beneficiary of any of such provisions.

(b)           The Domestic Administrative Agent shall also act as the
“collateral agent” under the Loan Documents, and each of the Lenders (in its
capacities as a Lender, potential Hedge Bank and potential Cash Management Bank)
and the L/C Issuers hereby irrevocably appoints and authorizes the Domestic
Administrative Agent to act as the agent of such Lender and the L/C Issuers for
purposes of acquiring, holding and enforcing any and all Liens on Collateral
granted by any of the Loan Parties to secure any of the Obligations, together
with such powers and discretion as are reasonably incidental thereto. In this
connection, the Domestic Administrative Agent, as “collateral agent” and any
co-agents, sub-agents and attorneys-in-fact appointed by the Domestic
Administrative Agent pursuant to Section 9.05 for purposes of holding or
enforcing any Lien on the Collateral (or any portion thereof) granted under the
Collateral Documents, or for exercising any rights and remedies thereunder at
the direction of the Domestic Administrative Agent), shall be entitled to the
benefits of all provisions of this Article IX and Article X (including
Section 10.04(c), as though such co-agents, sub-agents and attorneys-in-fact
were the “collateral agent” under the Loan Documents) as if set forth in full
herein with respect thereto.

9.02        Rights as a Lender.  Each Person serving as an Administrative 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
Administrative Agent and the term “Lender” or “Lenders” shall, unless otherwise
expressly indicated or unless the context otherwise requires,

85

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

include the Person serving as an Administrative Agent hereunder in its
individual capacity. Such Person and its Affiliates may accept deposits from,
lend money to, act as the financial advisor or in any other advisory capacity
for and generally engage in any kind of business with the Borrowers or any
Subsidiary or other Affiliate thereof as if such Person were not an
Administrative Agent hereunder and without any duty to account therefor to the
Lenders.

9.03        Exculpatory Provisions.  The Administrative 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, the
Administrative Agents:

(a)           shall not be subject to any fiduciary or other implied duties,
regardless of whether a Default has occurred and is continuing;

(b)           shall not have any duty to take any discretionary action or
exercise any discretionary powers, except discretionary rights and powers
expressly contemplated hereby or by the other Loan Documents that an
Administrative Agent is required to exercise as directed in writing by the
Required Lenders (or such other number or percentage of the Lenders as shall be
expressly provided for herein or in the other Loan Documents), provided that an
Administrative Agent shall not be required to take any action that, in its
opinion or the opinion of its counsel, may expose such Administrative Agent to
liability or that is contrary to any Loan Document or applicable law; and

(c)           shall not, except as expressly set forth herein and in the other
Loan Documents, 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
Affiliates that is communicated to or obtained by the Person serving as an
Administrative Agent or any of its Affiliates in any capacity.

No Administrative Agent shall be liable for any action taken or not taken by it
(i) with the consent or at the request of the Required Lenders (or such other
number or percentage of the Lenders as shall be necessary, or as such
Administrative Agent shall believe in good faith shall be necessary, under the
circumstances as provided in Sections 10.01 and 8.02) or (ii) in the absence of
its own gross negligence or willful misconduct. No Administrative Agent shall be
deemed to have knowledge of any Default unless and until notice describing such
Default is given to such Administrative Agent by a Borrower, a Lender or an L/C
Issuer.

No Administrative Agent shall 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 or any other Loan Document, (ii) the contents of
any certificate, report or other document delivered hereunder or thereunder or
in connection herewith or therewith, (iii) the performance or observance of any
of the covenants, agreements or other terms or conditions set forth herein or
therein or the occurrence of any Default, (iv) the validity, enforceability,
effectiveness or genuineness of this Agreement, any other Loan Document or any
other agreement, instrument or document, or the creation, perfection or priority
of any Lien purported to be created by the Collateral Documents, (v) the value
or the sufficiency of any Collateral, 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 such Administrative Agent.

86

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

9.04        Reliance by Administrative Agent. Each Administrative Agent 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 (including any electronic message, Internet or intranet website posting
or other distribution) believed by it to be genuine and to have been signed,
sent or otherwise authenticated by the proper Person. Each Administrative Agent
also may rely upon any statement made to it orally or by telephone and believed
by it to have been made by the proper Person, and shall not incur any liability
for relying thereon. In determining compliance with any condition hereunder to
the making of a Loan, or the issuance of a Letter of Credit, that by its terms
must be fulfilled to the satisfaction of a Lender or an L/C Issuer, each
Administrative Agent may presume that such condition is satisfactory to such
Lender or L/C Issuer unless such Administrative Agent shall have received notice
to the contrary from such Lender or L/C Issuer prior to the making of such Loan
or the issuance of such Letter of Credit. Each Administrative Agent 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.

9.05        Delegation of Duties.  Each Administrative Agent may perform any and
all of its duties and exercise its rights and powers hereunder or under any
other Loan Document by or through any one or more sub-agents appointed by such
Administrative Agent. Each Administrative Agent and any such sub-agent may
perform any and all of its duties and exercise its rights and powers by or
through their respective Related Parties. The exculpatory provisions of this
Article shall apply to any such sub-agent and to the Related Parties of each
Administrative Agent 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 Administrative Agent.

9.06        Resignation of Administrative Agent.  Either Administrative Agent
may at any time give notice of its resignation to the Lenders, the L/C Issuers
and the Borrowers. Upon receipt of any such notice of resignation, the Required
Lenders shall have the right, subject, so long as no Event of Default then
exists and is continuing, to the approval of the Domestic Borrower or Canadian
Borrower, as applicable, (such consent not to be unreasonably withheld) to
appoint a successor, which shall be a bank with an office in the United States,
or an Affiliate of any such bank with an office in the United States (in respect
of the replacement of the Domestic Administrative Agent) or which shall be a
bank with an office in Canada or an Affiliate of any such bank with an office in
Canada (in respect of the replacement of the Canadian Administrative Agent). If
no such successor shall have been so appointed by the Required Lenders and shall
have accepted such appointment within 30 days after the retiring Administrative
Agent gives notice of its resignation, then the retiring Administrative Agent
may on behalf of the Lenders and the L/C Issuers, appoint a successor
Administrative Agent reasonably acceptable to the Borrowers and meeting the
qualifications set forth above; provided that if such Administrative Agent shall
notify the Borrowers and the Lenders that no qualifying Person has accepted such
appointment, then such resignation shall nonetheless become effective in
accordance with such notice and (a) the retiring Administrative Agent shall be
discharged from its duties and obligations hereunder and under the other Loan
Documents (except that in the case of any collateral security held by such
Administrative Agent on behalf of the Lenders or the L/C Issuers under any of
the Loan Documents, the retiring Administrative Agent shall continue

87

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

to hold such collateral security until such time as a successor Administrative
Agent is appointed) and (b) all payments, communications and determinations
provided to be made by, to or through such Administrative Agent shall instead be
made by or to each Lender and L/C Issuer directly, until such time as the
Required Lenders appoint a successor Administrative Agent as provided for above
in this Section. Upon the acceptance of a successor’s appointment as
Administrative Agent hereunder, such successor shall succeed to and become
vested with all of the rights, powers, privileges and duties of the retiring (or
retired) Administrative Agent, and the retiring Administrative Agent shall be
discharged from all of its duties and obligations hereunder or under the other
Loan Documents (if not already discharged therefrom as provided above in this
Section). The fees payable by the Borrowers to a successor Administrative Agent
shall be the same as those payable to its predecessor unless otherwise agreed
between the Borrowers and such successor. After the retiring Administrative
Agent’s resignation hereunder and under the other Loan Documents, the provisions
of this Article and Section 10.04 shall continue in effect for the benefit of
such retiring Administrative 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 the retiring Administrative Agent was acting as Administrative Agent.

Any resignation by Bank of America or Bank of America Canada as Administrative
Agent pursuant to this Section shall also constitute its resignation as an L/C
Issuer. Upon the acceptance of a successor’s appointment as Administrative Agent
hereunder, (i) such successor shall succeed to and become vested with all of the
rights, powers, privileges and duties of the retiring L/C Issuer, (ii) the
retiring L/C Issuer shall be discharged from all of its duties and obligations
hereunder or under the other Loan Documents, and (iii) the successor L/C Issuer
shall issue letters of credit in substitution for the Letters of Credit, if any,
outstanding at the time of such succession or make other arrangements
satisfactory to the retiring L/C Issuer to effectively assume the obligations of
the retiring L/C Issuer with respect to such Letters of Credit.

9.07        Non-Reliance on Administrative Agents and Other Lenders.  Each
Lender and L/C Issuer acknowledges that it has, independently and without
reliance upon either Administrative Agent or any other Lender or any of their
Related Parties 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 and L/C Issuer also acknowledges that it will,
independently and without reliance upon either Administrative Agent or any other
Lender or any of their Related Parties 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 other Loan Document or any related agreement or any document furnished
hereunder or thereunder.

9.08        Administrative Agents May File Proofs of Claim.  In case of the
pendency of any proceeding under any Debtor Relief Law or any other judicial
proceeding relative to any Loan Party, the Administrative Agents (irrespective
of whether the principal of any Loan or L/C Obligation shall then be due and
payable as herein expressed or by declaration or otherwise and irrespective of
whether the Administrative Agents shall have made any demand on the Borrowers)
shall be entitled and empowered, by intervention in such proceeding or otherwise

88

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

(a)           to file and prove a claim for the whole amount of the principal
and interest owing and unpaid in respect of the Loans, L/C Obligations and all
other Obligations that are owing and unpaid and to file such other documents as
may be necessary or advisable in order to have the claims of the Lenders, the
L/C Issuers and the Administrative Agents (including any claim for the
reasonable compensation, expenses, disbursements and advances of the Lenders,
the L/C Issuers and the Administrative Agents and their respective agents and
counsel and all other amounts due the Lenders, the L/C Issuers and the
Administrative Agents under Sections 2.03(i) and (j), 2.09 and 10.04) allowed in
such judicial proceeding; and

(b)           to collect and receive any monies or other property payable or
deliverable on any such claims and to distribute the same;

and any custodian, receiver, assignee, trustee, liquidator, sequestrator or
other similar official in any such judicial proceeding is hereby authorized by
each Lender and L/C Issuer to make such payments to the Administrative Agents
and, if the Administrative Agents shall consent to the making of such payments
directly to the Lenders and L/C Issuers, to pay to the Administrative Agents any
amount due for the reasonable compensation, expenses, disbursements and advances
of the Administrative Agents and its agents and counsel, and any other amounts
due the Administrative Agents under Sections 2.09 and 10.04.

Nothing contained herein shall be deemed to authorize either Administrative
Agent to authorize or consent to or accept or adopt on behalf of any Lender or
L/C Issuer any plan of reorganization, arrangement, adjustment or composition
affecting the Obligations or the rights of any Lender or L/C Issuer to authorize
such Administrative Agent to vote in respect of the claim of any Lender or the
L/C Issuer or in any such proceeding.

9.09        Collateral and Guaranty Matters.  The Lenders and the L/C Issuers
irrevocably authorize the Domestic Administrative Agent, at its option and in
its discretion,

(a)           to release any Lien on any property granted to or held by the
Domestic Administrative Agent under any Loan Document (i) upon termination of
the Aggregate Commitments and payment in full of all Obligations (other than
contingent indemnification obligations) and the expiration or termination of all
Letters of Credit, (ii) that is sold or transferred, or to be sold or
transferred, as part of or in connection with any sale or transfer permitted
hereunder or under any other Loan Document, or (iii)  if approved, authorized or
ratified in writing in accordance with Section 10.01;

(b)           to release any Guarantor from its obligations under the Guaranty
if such Person ceases to be a Subsidiary as a result of a transaction permitted
hereunder; and

(c)           to subordinate any Lien on any property granted to or held by the
Administrative Agent under any Loan Document to the holder of any Lien on such
property that is permitted by Section 7.01(g)(ii).

Upon request by the Domestic Administrative Agent at any time, the Required
Lenders will confirm in writing such Administrative Agent’s authority to release
or subordinate its interest in particular types or items of property, or to
release any Guarantor from its obligations under the Guaranty pursuant to this
Section 9.09.  In each case as specified in this Section 9.09,

89

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

the Domestic Administrative Agent will, at the Borrowers’ expense, execute and
deliver to the applicable Loan Party such documents as such Loan Party may
reasonably request to evidence the release of such item of Collateral from the
assignment and security interest granted under the Collateral Documents or to
subordinate its interest in such item, or to release such Guarantor from its
obligations under the Guaranty, in each case in accordance with the terms of the
Loan Documents and this Section 9.09.

ARTICLE X
MISCELLANEOUS

10.01      Amendments, Etc.  No amendment or waiver of any provision of this
Agreement or any other Loan Document, and no consent to any departure by a
Borrower or any other Loan Party therefrom, shall be effective unless in writing
signed by the Required Lenders and the Borrowers or the applicable Loan Party,
as the case may be, and acknowledged by the applicable Administrative Agent, and
each such waiver or consent shall be effective only in the specific instance and
for the specific purpose for which given; provided, however, that no such
amendment, waiver or consent shall:

(a)           extend or increase the Commitment of any Lender (or reinstate any
Commitment terminated pursuant to Section 8.02) without the written consent of
such Lender;

(b)           postpone any date fixed by this Agreement or any other Loan
Document for any payment of principal, interest, fees or other amounts due to
the Lenders (or any of them) hereunder or under such other Loan Document without
the written consent of each Lender entitled to such payment;

(c)           reduce the principal of, or the rate of interest specified herein
on, any Loan or L/C Borrowing, or (subject to clause (iv) of the second proviso
to this Section 10.01) any fees or other amounts payable hereunder or under any
other Loan Document without the written consent of each Lender entitled to such
amount; provided, however, that only the consent of the Required Lenders shall
be necessary (i) to amend the definition of “Default Rate” or to waive any
obligation of the Borrowers to pay interest or Letter of Credit Fees at the
Default Rate or (ii) to amend any financial covenant hereunder (or any defined
term used therein) even if the effect of such amendment would be to reduce the
rate of interest on any Loan or L/C Borrowing or to reduce any fee payable
hereunder;

(d)           change Section 8.03 in a manner that would alter the pro rata
sharing of payments required thereby without the written consent of each Lender;

(e)           change (i) any provision of this Section 10.01 or the definition
of “Required Lenders” or any other provision hereof specifying the number or
percentage of Lenders required to amend, waive or otherwise modify any rights
hereunder or make any determination or grant any consent hereunder, without the
written consent of each Lender;

(f)            release all or substantially all of the Collateral in any
transaction or series of related transactions, without the written consent of
each Lender; or

90

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

(g)           release all or substantially all of the value of the Guaranty,
without the written consent of each Lender;

and provided, further, that (i) no amendment, waiver or consent shall, unless in
writing and signed by the applicable L/C Issuer in addition to the Lenders
required above, affect the rights or duties of the such L/C Issuer under this
Agreement or any Issuer Document relating to any Letter of Credit issued or to
be issued by it; (ii) no amendment, waiver or consent shall, unless in writing
and signed by the applicable Administrative Agent in addition to the Lenders
required above, affect the rights or duties of the such Administrative Agent
under this Agreement or any other Loan Document; and (iii) the Fee Letter may be
amended, or rights or privileges thereunder waived, in a writing executed only
by the parties thereto.  Notwithstanding anything to the contrary herein, no
Defaulting Lender shall have any right to approve or disapprove any amendment,
waiver or consent hereunder, except that the Commitment of such Lender may not
be increased or extended without the consent of such Lender.

If any Lender does not consent to a proposed amendment, waiver, consent or
release with respect to any Loan Document that requires the consent of each
Lender and that has been approved by the Required Lenders, the Domestic Borrower
may replace such non-consenting Lender in accordance with Section 10.13;
provided that such amendment, waiver, consent or release can be effected as a
result of the assignment contemplated by such Section (together with all other
such assignments required by the Domestic Borrower to be made pursuant to this
paragraph).

10.02      Notices; Effectiveness; Electronic Communications.  (a) Notices
Generally.  Except in the case of notices and other communications expressly
permitted to be given by telephone (and except as provided in subsection (b)
below), all notices and other communications provided for herein shall be in
writing and shall be delivered by hand or overnight courier service, mailed by
certified or registered mail or sent by telecopier as follows, and all notices
and other communications expressly permitted hereunder to be given by telephone
shall be made to the applicable telephone number, as follows:

(i)            if to the Borrowers, the Administrative Agents or the L/C
Issuers, to the address, telecopier number, electronic mail address or telephone
number specified for such Person on Schedule 10.02; and

(ii)           if to any other Lender, to the address, telecopier number,
electronic mail address or telephone number specified in its Administrative
Questionnaire.

Notices sent by hand or overnight courier service, or mailed by certified or
registered mail, shall be deemed to have been given when received; notices sent
by telecopier shall be deemed to have been given when sent (except that, if not
given during normal business hours for the recipient, shall be deemed to have
been given at the opening of business on the next business day for the
recipient).  Notices delivered through electronic communications to the extent
provided in subsection (b) below shall be effective as provided in such
subsection (b).

(b)           Electronic Communications.  Notices and other communications to
the Lenders and the L/C Issuers hereunder may be delivered or furnished by
electronic

91

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

communication (including e-mail and Internet or intranet websites) as set forth
in Section 6.02 or pursuant to other procedures approved by the Domestic
Administrative Agent, provided that the foregoing shall not apply to notices to
any Lender or L/C Issuer pursuant to Article II if such Lender or L/C Issuer, as
applicable, has notified the Domestic Administrative Agent that it is incapable
of receiving notices under such Article by electronic communication.  The
Domestic Administrative Agent or either Borrower may, in its discretion, agree
to accept notices and other communications to it hereunder by electronic
communications pursuant to procedures approved by it, provided that approval of
such procedures may be limited to particular notices or communications.

Unless the Administrative Agents otherwise prescribe, (i) notices and other
communications sent to an e-mail address shall be deemed received upon the
sender’s receipt of an acknowledgement from the intended recipient (such as by
the “return receipt requested” function, as available, return e-mail or other
written acknowledgement), provided that if such notice or other communication is
not sent during the normal business hours of the recipient, such notice or
communication shall be deemed to have been sent at the opening of business on
the next business day for the recipient, and (ii) notices or communications
posted to an Internet or intranet website shall be deemed received (1) upon
posting on the EDGAR Website or (2) upon the deemed receipt by the intended
recipient at its e-mail address as described in the foregoing clause (i) of
notification that such notice or communication is available and identifying the
website address therefor.

(c)           The Platform.  THE PLATFORM IS PROVIDED “AS IS” AND “AS
AVAILABLE.”  THE AGENT PARTIES (AS DEFINED BELOW) DO NOT WARRANT THE ACCURACY OR
COMPLETENESS OF THE BORROWER MATERIALS OR THE ADEQUACY OF THE PLATFORM, AND
EXPRESSLY DISCLAIM LIABILITY FOR ERRORS IN OR OMISSIONS FROM THE BORROWER
MATERIALS.  NO WARRANTY OF ANY KIND, EXPRESS, IMPLIED OR STATUTORY, INCLUDING
ANY WARRANTY OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE,
NON-INFRINGEMENT OF THIRD PARTY RIGHTS OR FREEDOM FROM VIRUSES OR OTHER CODE
DEFECTS, IS MADE BY ANY AGENT PARTY IN CONNECTION WITH THE BORROWER MATERIALS OR
THE PLATFORM.  In no event shall the Administrative Agents or any of their
Related Parties (collectively, the “Agent Parties”) have any liability to the
Borrowers, any Lender, the L/C Issuers or any other Person for losses, claims,
damages, liabilities or expenses of any kind (whether in tort, contract or
otherwise) arising out of the Borrowers’ or the Administrative Agents’
transmission of Borrower Materials through the Internet, except to the extent
that such losses, claims, damages, liabilities or expenses are determined by a
court of competent jurisdiction by a final and nonappealable judgment to have
resulted from the gross negligence or willful misconduct of such Agent Party;
provided, however, that in no event shall any Agent Party have any liability to
the Borrowers, any Lender, the L/C Issuers or any other Person for indirect,
special, incidental, consequential or punitive damages (as opposed to direct or
actual damages).

(d)           Change of Address, Etc.  Each of the Borrowers, the Administrative
Agents and the L/C Issuers may change its address, telecopier or telephone
number for notices and other communications hereunder by notice to the other
parties hereto.  Each Lender may change its address, telecopier or telephone
number for notices and other communications

92

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

hereunder by notice to the Borrowers, the Administrative Agents and the L/C
Issuers.  In addition, each Lender agrees to notify the Administrative Agents
from time to time to ensure that each Administrative Agent has on record (i) an
effective address, contact name, telephone number, telecopier number and
electronic mail address to which notices and other communications may be sent
and (ii) accurate wire instructions for such Lender.

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

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

10.04      Expenses; Indemnity; Damage Waiver.  (a) Costs and Expenses.  Each
Borrower jointly and severally agrees to pay (i) all reasonable out-of-pocket
expenses incurred by the Administrative Agents and their Affiliates (including
the reasonable fees, charges and disbursements of counsel for the Administrative
Agents), in connection with the syndication of the credit facilities provided
for herein, the preparation, negotiation, execution, delivery and administration
of this Agreement and the other Loan Documents or any amendments, modifications
or waivers of the provisions hereof or thereof (whether or not the transactions
contemplated hereby or thereby shall be consummated), (ii) all reasonable
out-of-pocket expenses incurred by the L/C Issuers in connection with the
issuance, amendment, renewal or extension of any Letter of Credit or any demand
for payment thereunder and (iii) all out of pocket expenses incurred by the
Administrative Agents, any Lender or the L/C Issuers (including the reasonable
fees, charges and disbursements of any counsel for the Administrative Agents,
any Lender or the L/C Issuers) and shall pay all reasonable fees and time
charges for attorneys who may be employees of the Administrative Agents, any
Lender or the L/C Issuers, in connection with the enforcement or protection of
its rights (A) in connection with this Agreement and the other Loan Documents,
including its rights under this Section, or (B) in connection with 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.

93

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

(b)           Indemnification by the Borrowers.  The Borrowers jointly and
severally agree to indemnify the Administrative Agents (and any sub-agent
thereof), each Lender and the L/C Issuers, 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 counsel for the Indemnitees, provided that all Indemnitees
shall use a single counsel in each appropriate jurisdiction, except in the case
of a bona fide conflict of interest where additional counsel may be retained),
incurred by any Indemnitee or asserted against any Indemnitee by any third party
or by a Borrower or any other Loan Party arising out of, in connection with, or
as a result of (i) the execution or delivery of this Agreement, any other Loan
Document or any agreement or instrument contemplated hereby or thereby, the
performance by the parties hereto of their respective obligations hereunder or
thereunder or the consummation of the transactions contemplated hereby or
thereby, or, in the case of an Administrative Agent (and any sub-agent thereof)
and its Related Parties only, the administration of this Agreement and the other
Loan Documents, (ii) any Loan or Letter of Credit or the use or proposed use of
the proceeds therefrom (including any refusal by an L/C Issuer to honor a demand
for payment under a Letter of Credit if the documents presented in connection
with such demand do not strictly comply with the terms of such Letter of
Credit), (iii) any actual or alleged presence or release of Hazardous Materials
on or from any property owned or operated by a Borrower or any of its
Subsidiaries, or any Environmental Liability related in any way to a Borrower or
any of its Subsidiaries, or (iv) any actual or prospective claim, litigation,
investigation or proceeding relating to any of the foregoing, whether based on
contract, tort or any other theory, whether brought by a third party or by a
Borrower or any other Loan Party or any of such Borrower’s or such Loan Party’s
directors, shareholders or creditors, and regardless of whether any Indemnitee
is a party thereto; provided that such indemnity shall not, as to any
Indemnitee, be available to the extent that such losses, claims, damages,
liabilities or related expenses (x) are determined by a court of competent
jurisdiction by final and nonappealable judgment to have resulted from the gross
negligence, willful misconduct or bad faith of such Indemnitee or (y) result
from a claim brought by a Borrower or any other Loan Party against an Indemnitee
for breach in bad faith of such Indemnitee’s obligations hereunder or under any
other Loan Document, if such Borrower or such Loan Party has obtained a final
and nonappealable judgment in its favor on such claim as determined by a court
of competent jurisdiction.

(c)           Reimbursement by Lenders.  To the extent that the Borrowers for
any reason fail to indefeasibly pay any amount required under subsection (a) or
(b) of this Section to be paid by them to the Administrative Agents (or any
sub-agent thereof), the L/C Issuers or any Related Party of any of the
foregoing, each Lender severally agrees to pay to the Administrative Agents (or
any such sub-agent), the L/C Issuers or such Related Party, as the case may be,
such Lender’s Applicable Percentage (determined as of the time that the
applicable unreimbursed expense or indemnity payment is sought) of such unpaid
amount, provided that the unreimbursed expense or indemnified loss, claim,
damage, liability or related expense, as the case may be, was incurred by or
asserted against such Administrative Agent (or any such sub-agent) or such L/C
Issuer in its capacity as such, or against any Related Party of any of the
foregoing acting for such Administrative Agent (or any such sub-agent) or L/C
Issuer in connection with such capacity.  The obligations of the Lenders under
this subsection (c) are subject to the provisions of Section 2.12(d).

94

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

(d)           Waiver of Consequential Damages, Etc.  To the fullest extent
permitted by applicable law, each Borrower 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,
any other Loan Document or any agreement or instrument contemplated hereby, the
transactions contemplated hereby or thereby, any Loan or Letter of Credit or the
use of the proceeds thereof.  No Indemnitee referred to in subsection (b) above
shall be liable for any damages arising from the use by unintended recipients of
any information or other materials distributed to such unintended recipients by
such Indemnitee through telecommunications, electronic or other information
transmission systems in connection with this Agreement or the other Loan
Documents or the transactions contemplated hereby or thereby other than for
direct or actual damages resulting from the gross negligence or willful
misconduct of such Indemnitee as determined by a final and nonappealable
judgment of a court of competent jurisdiction.

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

(f)            Survival.  The agreements in this Section shall survive the
resignation of any Administrative Agent and any L/C Issuer, the replacement of
any Lender, the termination of the Aggregate Commitments and the repayment,
satisfaction or discharge of all the other Obligations.

10.05      Payments Set Aside.  To the extent that any payment by or on behalf
of a Borrower is made to any Administrative Agent, any L/C Issuer or any Lender,
or any Administrative Agent, L/C Issuer or any Lender exercises its right of
setoff, and such payment or the proceeds of such setoff or any part thereof is
subsequently invalidated, declared to be fraudulent or preferential, set aside
or required (including pursuant to any settlement entered into by any
Administrative Agent, any L/C Issuer or such Lender in its discretion) to be
repaid to a trustee, receiver or any other party, in connection with any
proceeding under any Debtor Relief Law or otherwise, then (a) to the extent of
such recovery, the obligation or part thereof originally intended to be
satisfied shall be revived and continued in full force and effect as if such
payment had not been made or such setoff had not occurred, and (b) each Lender
and each L/C Issuer severally agrees to pay to the applicable Administrative
Agent upon demand its applicable share (without duplication) of any amount so
recovered from or repaid by such Administrative Agent, plus interest thereon
from the date of such demand to the date such payment is made at a rate per
annum equal to the Federal Funds Rate from time to time in effect.  The
obligations of the Lenders and the L/C Issuers under clause (b) of the preceding
sentence shall survive the payment in full of the Obligations and the
termination of this Agreement.

10.06      Successors and Assigns.  (a) Successors and Assigns Generally.  The
provisions of this Agreement shall be binding upon and inure to the benefit of
the parties hereto and their respective successors and assigns permitted hereby,
except that neither Borrower may assign or otherwise transfer any of its rights
or obligations hereunder without the prior written consent of the Domestic
Administrative Agent and each Lender and no Lender may assign or otherwise
transfer any of its rights or obligations hereunder except (i) to an assignee in
accordance with the provisions of Section 10.06(b), (ii) by way of participation
in accordance with the provisions of Section 10.06(d), or (iii) by way of pledge
or assignment of a security interest subject to the

95

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

restrictions of Section 10.06(f) (and any other attempted assignment or transfer
by any party hereto shall be null and void).  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,
Participants to the extent provided in subsection (d) of this Section and, to
the extent expressly contemplated hereby, the Related Parties of each of the
Administrative Agents, the L/C Issuers and the Lenders) any legal or equitable
right, remedy or claim under or by reason of this Agreement.

(b)           Assignments by Lenders.  Any Lender may at any time 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(s) and the Loans
(including for purposes of this Section 10.06(b), participations in L/C
Obligations) at the time owing to it); provided that any such assignment shall
be subject to the following conditions:

(i)            Minimum Amounts.

(A)          in the case of an assignment of the entire remaining amount of the
assigning Lender’s Commitment under any Facility and the Loans at the time owing
to it under such Facility or in the case of an assignment to a Lender, an
Affiliate of a Lender or an Approved Fund, no minimum amount need be assigned;
and

(B)           in any case not described in subsection (b)(i)(A) of this Section,
the aggregate amount of the Commitment (which for this purpose includes Loans
outstanding thereunder) or, if the Commitment is not then in effect, the
principal outstanding balance of the Loans of the assigning Lender subject to
each such assignment, determined as of the date the Assignment and Assumption
with respect to such assignment is delivered to the Administrative Agent or, if
“Trade Date” is specified in the Assignment and Assumption, as of the Trade
Date, shall not be less than $5,000,000, unless each of the applicable
Administrative Agent and, so long as no Event of Default has occurred and is
continuing, the applicable Borrower otherwise consents (each such consent not to
be unreasonably withheld or delayed); provided, however, that concurrent
assignments to members of an Assignee Group and concurrent assignments from
members of an Assignee Group to a single Eligible Assignee (or to an Eligible
Assignee and members of its Assignee Group) will be treated as a single
assignment for purposes of determining whether such minimum amount has been met;

(ii)           Proportionate Amounts.  Each partial assignment shall be made as
an assignment of a proportionate part of all the assigning Lender’s rights and
obligations under this Agreement with respect to the Loans or the Commitment
assigned, except that this clause (ii) shall not prohibit any Lender from
assigning all or a portion of its rights and obligations among separate
Facilities on a non-pro rata basis;

96

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

(iii)          Required Consents.  No consent shall be required for any
assignment except to the extent required by subsection (b)(i)(B) of this Section
and, in addition:

(A)          the consent of a Borrower (such consent not to be unreasonably
withheld or delayed) shall be required unless (1) an Event of Default has
occurred and is continuing at the time of such assignment or (2) such assignment
is to a Lender, an Affiliate of a Lender or an Approved Fund;

(B)           the consent of applicable Administrative Agent (such consent not
to be unreasonably withheld or delayed) shall be required for assignments in
respect of any Commitment if such assignment is to a Person that is not a Lender
with a Commitment in respect of the applicable Facility, an Affiliate of such
Lender or an Approved Fund with respect to such Lender; and

(C)           the consent of the applicable L/C Issuer (such consent not to be
unreasonably withheld or delayed) shall be required for any assignment that
increases the obligation of the assignee to participate in exposure under one or
more Letters of Credit (whether or not then outstanding).

(iv)          Assignment and Assumption.  The parties to each assignment shall
execute and deliver to the Administrative Agent an Assignment and Assumption,
together with a processing and recordation fee in the amount, if any, required
as set forth in Schedule 10.06 as well as all ancillary documents, including any
Tax forms, required under Section 3.01; provided, however, that the applicable
Administrative Agent may, in its sole discretion, elect to waive such processing
and recordation fee in the case of any assignment.  The assignee, if it shall
not be a Lender, shall deliver to the applicable Administrative Agent an
Administrative Questionnaire.

(v)           No Assignment to Borrower.  No such assignment shall be made to a
Borrower or any of a Borrower’s Affiliates or Subsidiaries.

(vi)          No Assignment to Natural Persons.  No such assignment shall be
made to a natural person.

(vii)         Canadian Loan.  No such assignment of a Canadian Loan or
Commitment shall be made to any Person other than a financial institution that,
upon the effectiveness of such assignment, will be a “Canadian Lender” as set
forth in the definition thereof.

Subject to acceptance and recording thereof by the applicable Administrative
Agent pursuant to subsection (c) of this Section, and upon satisfaction of the
conditions set forth above, from and after the effective date specified in each
Assignment and Assumption, the assignee thereunder shall be a party to this
Agreement 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

97

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

obligations under this Agreement, such Lender shall cease to be a party hereto
but shall continue to be entitled to the benefits of Sections 3.01, 3.04, 3.05
and 10.04 with respect to facts and circumstances occurring prior to the
effective date of such assignment).  Upon request, the applicable Borrower (at
its expense) shall execute and deliver a Note to the assignee Lender.  Any
assignment or transfer by a Lender of rights or obligations under this Agreement
that does not comply with this subsection 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 Section 10.06(d).  No assignee shall be entitled
to receive any greater benefit pursuant to this Agreement (including but not
limited to Sections 3.01, 3.04, 3.05 and 10.04 hereof) than the Lender assignor
would have been entitled to receive with respect to the rights transferred.

(c)           Register.  Each Administrative Agent, acting solely for this
purpose as an agent of the applicable Borrower, shall maintain at the
Administrative Agent’s Office 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 Commitments of, and principal amounts of the Loans and L/C
Obligations owing to, each Lender pursuant to the terms hereof from time to time
(the “Register”).  The entries in the Register shall be conclusive, and the
Borrowers, the Administrative Agents and the Lenders may treat each Person whose
name is recorded in the Register pursuant to the terms hereof as a Lender
hereunder for all purposes of this Agreement, notwithstanding notice to the
contrary.  The Register shall be available for inspection by the Borrowers and
any Lender, at any reasonable time and from time to time upon reasonable prior
notice.

(d)           Participations.  Any Lender may at any time, without the consent
of, or notice to, the Borrowers or the Administrative Agents, sell
participations to any Person (other than a natural person or a Borrower or any
of a Borrower’s Affiliates or Subsidiaries) (each, a “Participant”) in all or a
portion of such Lender’s rights and/or obligations under this Agreement
(including all or a portion of its Commitment and/or the Loans (including such
Lender’s participations in L/C Obligations) owing to it); provided that (i) such
Lender’s obligations under this Agreement shall remain unchanged, (ii) such
Lender shall remain solely responsible to the other parties hereto for the
performance of such obligations and (iii) the Borrowers, the Administrative
Agents, the Lenders and the L/C Issuers 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, waiver or other modification
described in the first proviso to Section 10.01 that affects such Participant. 
Subject to subsection (e) of this Section, each Borrower agrees that each
Participant shall be entitled to the benefits of Sections 3.01, 3.04 and 3.05 to
the same extent as if it were a Lender and had acquired its interest by
assignment pursuant to Section 10.06(b).  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 2.13 as
though it were a Lender.

(e)           Limitations upon Participant Rights.  A Participant shall not be
entitled to receive any greater payment under Section 3.01 or 3.04 than the
applicable Lender would have

98

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

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 applicable Borrower’s prior written consent.  A Participant shall not
be entitled to the benefits of Section 3.01 unless the Borrowers are notified of
the participation sold to such Participant and such Participant agrees, for the
benefit of the Borrowers, to comply with Section 3.01(e) as though it were a
Lender.

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

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

(h)           Resignation as L/C Issuer after Assignment.  Notwithstanding
anything to the contrary contained herein, if at any time Bank of America or
Bank of America Canada assigns all of its Revolving Credit Commitments and
Committed Loans pursuant to Section 10.06(b), it may, upon 30 days’ notice to
the Borrowers and the Lenders, resign as L/C Issuer.  In the event of any such
resignation as L/C Issuer, the Borrowers shall be entitled to appoint from among
the Lenders a successor L/C Issuer hereunder; provided, however, that no failure
by the Borrowers to appoint any such successor shall affect the resignation of
Bank of America or Bank of America Canada as L/C Issuer.  If Bank of America or
Bank of America Canada resigns as L/C Issuer, it shall retain all the rights,
powers, privileges and duties of the L/C Issuer hereunder with respect to all
Letters of Credit outstanding as of the effective date of its resignation as L/C
Issuer and all L/C Obligations with respect thereto (including the right to
require the Lenders to make Base Rate Loans or fund risk participations in
Unreimbursed Amounts pursuant to Section 2.03(c)).  Upon the appointment of a
successor L/C Issuer, (a) such successor shall succeed to and become vested with
all of the rights, powers, privileges and duties of the retiring L/C Issuer, and
(b) the successor L/C Issuer shall issue letters of credit in substitution for
the Letters of Credit, if any, outstanding at the time of such succession or
make other arrangements satisfactory to Bank of America or Bank of America
Canada, as appropriate, to effectively assume the obligations of such party with
respect to such Letters of Credit.

10.07      Treatment of Certain Information; Confidentiality.  Each of the
Administrative Agents, the Lenders and the L/C Issuers agrees to maintain the
confidentiality of the Information (as defined below), except that Information
may be disclosed (a) to its Affiliates and to its and its Affiliates’ respective
partners, directors, officers, employees, agents, advisors and representatives
in connection with this Agreement and the Loans (it being understood that the
Persons to whom such disclosure is made will be informed of the confidential
nature of such

99

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

Information and instructed to keep such Information confidential), (b) to the
extent requested by any regulatory authority purporting to have jurisdiction
over it (including any self-regulatory authority, such as the National
Association of Insurance Commissioners), (c) to the extent required by
applicable laws or regulations or by any subpoena or similar legal process, (d)
to any other party hereto, (e) in connection with the exercise of any remedies
hereunder or under any other Loan Document or any action or proceeding relating
to this Agreement or any other Loan Document or the enforcement of rights
hereunder or thereunder, (f) subject to an agreement containing provisions
substantially the same as those of this Section, to (1) any assignee of or
Participant in, or any prospective assignee of or Participant in, any of its
rights or obligations under this Agreement or (2) any actual or prospective
counterparty (or its advisors) to any swap or derivative transaction relating to
a Borrower and its obligations, (g) with the consent of a Borrower 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 any Administrative Agent,
any Lender, any L/C Issuer or any of their respective Affiliates on a
nonconfidential basis from a source other than the Borrowers.

For purposes of this Section, “Information” means all information received from
any Loan Party or any Subsidiary thereof relating to any Loan Party or any
Subsidiary thereof or their respective businesses, other than any such
information that is publicly available on the EDGAR Website or that is available
to any Administrative Agent, any Lender or any L/C Issuer on a nonconfidential
basis prior to disclosure by any Loan Party or any Subsidiary thereof.  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.

Each of the Administrative Agents, the Lenders and the L/C Issuers acknowledge
that (a) the Information may include material non-public information concerning
the Borrowers or a Subsidiary, as the case may be, (b) it has developed
compliance procedures regarding the use of material non-public information and
(c) it will handle such material non-public information in accordance with
applicable Law, including Federal and state securities Laws.

10.08      Right of Setoff.  If an Event of Default shall have occurred and be
continuing, each Lender, each L/C Issuer and each of their respective Affiliates
is hereby authorized at any time and from time to time, after obtaining the
prior written consent of the Domestic Administrative Agent, to the fullest
extent permitted by applicable law, to set off and apply any and all deposits
(general or special, time or demand, provisional or final, in whatever currency)
at any time held and other obligations (in whatever currency) at any time owing
by such Lender, such L/C Issuer or any such Affiliate to or for the credit or
the account of a Borrower or any other Loan Party against any and all of the
obligations of either Borrower or such Loan Party now or hereafter existing
under this Agreement or any other Loan Document to such Lender or L/C Issuer,
irrespective of whether or not such Lender or L/C Issuer shall have made any
demand under this Agreement or any other Loan Document and although such
obligations of such Borrower or such Loan Party may be contingent or unmatured
or are owed to a branch or office of such Lender or L/C Issuer different from
the branch or office holding such deposit or obligated on such indebtedness. 
The rights of each Lender, each L/C Issuer and their respective Affiliates under
this Section are in addition to other rights and remedies (including other
rights of

100

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

setoff) that such Lender, such L/C Issuer or their respective Affiliates may
have.  Each Lender and each L/C Issuer agrees to notify the Borrowers and the
Administrative Agents promptly after any such setoff and application, provided
that the failure to give such notice shall not affect the validity of such
setoff and application.

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

10.10      Counterparts; Integration; Effectiveness.  This Agreement may be
executed in counterparts (and by different parties hereto in different
counterparts), each of which shall constitute an original, but all of which when
taken together shall constitute a single contract.  This Agreement and the other
Loan Documents constitute the entire contract among the parties relating to the
subject matter hereof and supersede any and all previous agreements and
understandings, oral or written, relating to the subject matter hereof.  Except
as provided in Section 4.01, this Agreement shall become effective when it shall
have been executed by the Administrative Agents and when the Administrative
Agents shall have received counterparts hereof that, when taken together, bear
the signatures of each of the other parties hereto.  Delivery of an executed
counterpart of a signature page of this Agreement by telecopy shall be effective
as delivery of a manually executed counterpart of this Agreement.

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

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

101

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

invalidity of a provision in a particular jurisdiction shall not invalidate or
render unenforceable such provision in any other jurisdiction.

10.13      Replacement of Lenders.  If any Lender requests compensation under
Section 3.04, or if a Borrower is required to pay any additional amount to any
Lender or any Governmental Authority for the account of any Lender pursuant to
Section 3.01, if any Lender is a Defaulting Lender or if any other circumstance
exists hereunder that gives a Borrower the right to replace a Lender as a party
hereto, then such Borrower may, at its sole expense and effort, upon notice to
such Lender and the applicable Administrative Agent, require such Lender to
assign and delegate, without recourse (in accordance with and subject to the
restrictions contained in, and consents required by, Section 10.06), all of its
interests, rights and obligations under this Agreement and the related Loan
Documents to an assignee that shall assume such obligations (which assignee may
be another Lender, if a Lender accepts such assignment), provided that:

(a)           such Borrower shall have paid to the applicable Administrative
Agent the assignment fee specified in Section 10.06(b)(iv);

(b)           such Lender shall have received payment of an amount equal to the
outstanding principal of its Loans and L/C Advances, accrued interest thereon,
accrued fees and all other amounts payable to it hereunder and under the other
Loan Documents (including any amounts under Section 3.05) from the assignee (to
the extent of such outstanding principal and accrued interest and fees) or such
Borrower (in the case of all other amounts);

(c)           in the case of any such assignment resulting from a claim for
compensation under Section 3.04 or payments required to be made pursuant to
Section 3.01, such assignment will result in a reduction in such compensation or
payments thereafter; and

(d)           such assignment does not conflict with applicable Laws.

A Lender shall not be required to make any such assignment or delegation if,
prior thereto, as a result of a waiver by such Lender or otherwise, the
circumstances entitling the applicable Borrower to require such assignment and
delegation cease to apply.

10.14      GOVERNING LAW; JURISDICTION; ETC.  (a) GOVERNING LAW.  THIS AGREEMENT
SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF
CALIFORNIA.

(b)           SUBMISSION TO JURISDICTION.  EACH BORROWER IRREVOCABLY AND
UNCONDITIONALLY SUBMITS, FOR ITSELF AND ITS PROPERTY, TO THE NONEXCLUSIVE
JURISDICTION OF THE COURTS OF THE STATE OF CALIFORNIA SITTING IN LOS ANGELES
COUNTY AND OF THE UNITED STATES DISTRICT COURT OF THE CENTRAL DISTRICT OF
CALIFORNIA, AND ANY APPELLATE COURT FROM ANY THEREOF, IN ANY ACTION OR
PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER LOAN
DOCUMENT, OR FOR RECOGNITION OR ENFORCEMENT OF ANY JUDGMENT, AND EACH OF THE
PARTIES HERETO IRREVOCABLY AND UNCONDITIONALLY AGREES THAT ALL CLAIMS IN RESPECT
OF ANY SUCH ACTION OR PROCEEDING MAY BE

102

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

HEARD AND DETERMINED IN SUCH CALIFORNIA STATE COURT OR, TO THE FULLEST EXTENT
PERMITTED BY APPLICABLE LAW, IN SUCH FEDERAL COURT.  EACH OF THE PARTIES HERETO
AGREES THAT A FINAL JUDGMENT IN ANY SUCH ACTION OR PROCEEDING SHALL BE
CONCLUSIVE AND MAY BE ENFORCED IN OTHER JURISDICTIONS BY SUIT ON THE JUDGMENT OR
IN ANY OTHER MANNER PROVIDED BY LAW.  NOTHING IN THIS AGREEMENT OR IN ANY OTHER
LOAN DOCUMENT SHALL AFFECT ANY RIGHT THAT ANY ADMINISTRATIVE AGENT, ANY LENDER
OR ANY L/C ISSUER MAY OTHERWISE HAVE TO BRING ANY ACTION OR PROCEEDING RELATING
TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT AGAINST A BORROWER OR ITS
PROPERTIES IN THE COURTS OF ANY JURISDICTION.

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

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

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

10.16      No Advisory or Fiduciary Responsibility.  In connection with all
aspects of each transaction contemplated hereby, the Borrowers and the Loan
Parties each acknowledge and agree, and acknowledge their respective Affiliates’
understanding, that: (i) the credit facilities provided for hereunder and any
related arranging or other services in connection therewith

103

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

(including in connection with any amendment, waiver or other modification hereof
or of any other Loan Document) are an arm’s-length commercial transaction
between the Borrowers and their respective Affiliates, on the one hand, and the
Administrative Agents, on the other hand, and each of the Borrowers is capable
of evaluating and understanding and understands and accepts the terms, risks and
conditions of the transactions contemplated hereby and by the other Loan
Documents (including any amendment, waiver or other modification hereof or
thereof); (ii) in connection with the process leading to such transaction, each
Administrative Agent is and has been acting solely as a principal and is not the
financial advisor, agent or fiduciary, for the Borrowers or any of their
respective Affiliates, stockholders, creditors or employees or any other Person;
(iii) neither Administrative Agent has assumed or will assume an advisory,
agency or fiduciary responsibility in favor of either Borrower with respect to
any of the transactions contemplated hereby or the process leading thereto,
including with respect to any amendment, waiver or other modification hereof or
of any other Loan Document (irrespective of whether either Administrative Agent
has advised or is currently advising either Borrower or any of its Affiliates on
other matters) and neither Administrative Agent has any obligation to the
Borrowers or any of their respective Affiliates with respect to the transactions
contemplated hereby except those obligations expressly set forth herein and in
the other Loan Documents; (iv) the Administrative Agents and their respective
Affiliates may be engaged in a broad range of transactions that involve
interests that differ from those of the Borrowers and their Affiliates and
neither Administrative Agent has any obligation to disclose any of such
interests by virtue of any advisory, agency or fiduciary relationship; and (v)
the Administrative Agents have not provided and will not provide any legal,
accounting, regulatory or Tax advice with respect to any of the transactions
contemplated hereby (including any amendment, waiver or other modification
hereof or of any other Loan Document) and each Borrower has consulted its own
legal, accounting, regulatory and Tax advisors to the extent it has deemed
appropriate.  Each Borrower hereby waives and releases, to the fullest extent
permitted by law, any claims that it may have against the Administrative Agent
with respect to any breach or alleged breach of agency or fiduciary duty.

10.17      USA PATRIOT Act Notice.  Each Lender that is subject to the Act (as
hereinafter defined) and the Administrative Agent (for itself and not on behalf
of any Lender) hereby notifies the Borrower that pursuant to the requirements of
the USA PATRIOT Act (Title III of Pub. L. 107-56 (signed into law October 26,
2001)) (the “Act”), it is required to obtain, verify and record information that
identifies each Loan Party, which information includes the name and address of
each Loan Party and other information that will allow such Lender or the
Domestic Administrative Agent, as applicable, to identify each Loan Party in
accordance with the Act.

10.18      California Judicial Reference.  If any action or proceeding is filed
in a court of the State of California by or against any party hereto in
connection with any of the transactions contemplated by this Agreement or any
other Loan Document, the court shall, and is hereby directed to, make a general
reference pursuant to California Code of Civil Procedure Section 638 to a
referee (who shall be a single active or retired judge) to hear and determine
all of the issues in such action or proceeding (whether of fact or of law) and
to report a statement of decision, provided that at the option of any party to
such proceeding, any such issues pertaining to a “provisional remedy” as defined
in California Code of Civil Procedure Section 1281.8 shall be heard and
determined by the court.

104

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

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

GUESS ?, INC.

 

 

 

 

 

By:

  /s/ Carlos Alberini

 

 

Name:

Carlos Alberini

 

Title:

President and Chief Operating Officer

 

S-1

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

 

GUESS? CANADA CORPORATION

 

 

 

 

 

By:

  /s/ Carlos Alberini

 

 

Name:

Carlos Alberini

 

Title:

Chief Operating Officer

 

S-2

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

 

BANK OF AMERICA, N.A., as Domestic
Administrative Agent

 

 

 

 

 

By:

  /s/ Mathew Koenig

 

 

Name:

Matthew Koenig

 

Title:

Senior Vice President

 

S-3

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

 

BANK OF AMERICA, N.A., acting through its
Canada Branch, as Canada Administrative Agent

 

 

 

 

 

By:

  /s/ Medina Sales De Andrade

 

 

Name:

Medina Sales De Andrade

 

Title:

Assistant Vice President

 

S-4

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

 

BANK OF AMERICA, N.A., as a Domestic Lender
and L/C Issuer

 

 

 

 

 

By:

  /s/ Mathew Koenig

 

 

Name:

Matthew Koenig

 

Title:

Senior Vice President

 

S-5

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

 

BANK OF AMERICA, N.A., acting through its
Canada Branch, as a Canadian Lender and Canadian
L/C Issuer

 

 

 

 

 

By:

  /s/ Medina Sales De Andrade

 

 

Name:

Medina Sales De Andrade

 

Title:

Assistant Vice President

 

S-6

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

 

EXHIBIT A

FORM OF COMMITTED LOAN NOTICE

Date:                      ,             

To:          [Bank of America, N.A., as Domestic Administrative Agent]

[Bank of America, N.A., acting through its Canada Branch, as Canadian
Administrative Agent]

Ladies and Gentlemen:

Reference is made to that certain Credit Agreement, dated as of September 19,
2006 (as amended, restated, extended, supplemented or otherwise modified in
writing from time to time, the “Agreement;” the terms defined therein being used
herein as therein defined), among Guess?, Inc., a Delaware corporation (the
“Domestic Borrower”), Guess? Canada Corporation, a Canadian corporation and
wholly-owned subsidiary of the Domestic Borrower (together with the Domestic
Borrower, collectively, the “Borrowers” and individually, a “Borrower”), each
lender from time to time party thereto, Bank of America, N.A., as Domestic
Administrative Agent and Domestic L/C Issuer, and Bank of America, N.A., acting
through its Canada Branch, as Canadian Administrative Agent and Canadian L/C
Issuer.

The undersigned hereby requests (select one):

o

 

A Borrowing of [Domestic] [Canadian] Committed Loans

 

o

 

A conversion or continuation of [Domestic] [Canadian] Loans

 

1.             On
                                                                                                    
(a Business Day).

2.             In the amount of
$                                                                              .

3.             Comprised of
                                                                  .

[Type of Committed Loan requested:

Base Rate Loan or Eurodollar Rate Loan]

If conversion, of                         Loans to                    Loans.

4.             For Eurodollar Rate Loans:  with an Interest Period of
             months.

The Committed Borrowing, if any, requested herein complies with clause (i) of
the provisos to the first sentence of Sections 2.01(a) and (b) of the Agreement.

[GUESS?, INC.]

 

[GUESS? CANADA CORPORATION]

 

 

 

By:

 

 

 

Name:

 

 

 

Title:

 

 

 

 

A-1

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

EXHIBIT B

FORM OF NOTE

September 19, 2006

FOR VALUE RECEIVED, the undersigned (the “Borrower”) hereby promises to pay to
                                   or registered assigns (the “Lender”), in
accordance with the provisions of the Agreement (as hereinafter defined), the
principal amount of each Loan from time to time made by the Lender to the
Borrower under that certain Credit Agreement, dated as of even date herewith (as
amended, restated, extended, supplemented or otherwise modified in writing from
time to time, the “Agreement;” the terms defined therein being used herein as
therein defined), among the Borrower, [Guess?, Inc./Guess? Canada Corporation],
the Lenders from time to time party thereto, Bank of America, N.A., as Domestic
Administrative Agent and Domestic L/C Issuer and Bank of America, N.A., acting
through its Canada Branch, as Canadian Administrative Agent and Canadian L/C
Issuer.

The Borrower promises to pay interest on the unpaid principal amount of each
Loan from the date of such Loan until such principal amount is paid in full, at
such interest rates and at such times as provided in the Agreement.  All
payments of principal and interest shall be made to the [Domestic/Canadian]
Administrative Agent for the account of the Lender in [Canadian] Dollars in
immediately available funds at the [Domestic/Canadian] Administrative Agent’s
Office or at such other place as should be designated in writing for such
purpose in accordance with the terms of the Agreement.  If any amount is not
paid in full when due hereunder, such unpaid amount shall bear interest, to be
paid upon demand, from the due date thereof until the date of actual payment
(and before as well as after judgment) computed at the per annum rate set forth
in the Agreement.

This Note is one of the Notes referred to in the Agreement, is entitled to the
benefits thereof and may be prepaid in whole or in part subject to the terms and
conditions provided therein.  This Note is also entitled to the benefits of the
Guaranty and is secured by the Collateral.  Upon the occurrence and continuation
of one or more of the Events of Default specified in the Agreement, all amounts
then remaining unpaid on this Note may become, or may be declared to be,
immediately due and payable all as provided in the Agreement.  Loans made by the
Lender shall be evidenced by one or more loan accounts or records maintained by
the Lender in the ordinary course of business. The Lender may also attach
schedules to this Note and endorse thereon the date, amount and maturity of its
Loans and payments with respect thereto.

The Borrower, for itself, its successors and assigns, hereby waives diligence,
presentment, protest and demand and notice of protest, demand, dishonor and
non-payment of this Note.

The terms of this Note are subject to amendment only in the manner provided in
the Agreement.  This Note is subject to restrictions on transfer or assignment
as provided in the Agreement.

B-1

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

THIS NOTE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE
STATE OF CALIFORNIA.

[GUESS?, INC.]

 

[GUESS? CANADA CORPORATION]

 

 

 

 

 

By:

 

 

 

 

 

 

 

Name:

 

 

 

 

 

 

 

Title:

 

 

 

B-2

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

LOANS AND PAYMENTS WITH RESPECT THERETO

Date

 

Type of
Loan Made

 

Amount of
Loan Made

 

End of
Interest
Period

 

Amount of
Principal or
Interest
Paid This
Date

 

Outstanding
Principal
Balance
This Date

 

Notation
Made By

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

B-3

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

EXHIBIT C

FORM OF COMPLIANCE CERTIFICATE

Financial Statement Date:                 ,           

To:          Bank of America, N.A., as Domestic Administrative Agent

Ladies and Gentlemen:

Reference is made to that certain Credit Agreement, dated as of September 19,
2006 (as amended, restated, extended, supplemented or otherwise modified in
writing from time to time, the “Agreement;” the terms defined therein being used
herein as therein defined), among Guess?, Inc., a Delaware corporation (the
“Domestic Borrower”), Guess? Canada Corporation, a Canadian corporation and
wholly-owned subsidiary of the Domestic Borrower (together with the Domestic
Borrower, collectively, the “Borrowers” and individually, a “Borrower”), each
lender from time to time party thereto (collectively, the “Lenders” and
individually, a “Lender”), Bank of America, N.A., as Domestic Administrative
Agent and Domestic L/C Issuer, and Bank of America, N.A., acting through its
Canada Branch, as Canadian Administrative Agent and Canadian L/C Issuer.

The undersigned Responsible Officer hereby certifies as of the date hereof that
he/she is the                                                        of the
Domestic Borrower, and that, as such, he/she is authorized to execute and
deliver this Certificate to the Domestic Administrative Agent on the behalf of
the Domestic Borrower, and that:

[Use following paragraph 1 for fiscal year-end financial statements]

1.             [Attached hereto as Schedule 1] [Posted on the website of the
Domestic Borrower] are the year-end audited financial statements required by
Section 6.01(a) of the Agreement for the fiscal year of the Domestic Borrower
ended as of the above date, together with the report and opinion of an
independent certified public accountant required by such section.

[Use following paragraph 1 for fiscal quarter-end financial statements]

1.             [Attached hereto as Schedule 1] [Posted on the website of the
Domestic Borrower] are the unaudited financial statements required by Section
6.01(b) of the Agreement for the fiscal quarter of the Domestic Borrower ended
as of the above date.  Such financial statements fairly present the financial
condition, results of operations and cash flows of the Domestic Borrower and its
Subsidiaries in accordance with GAAP as at such date and for such period,
subject only to normal year-end audit adjustments and the absence of footnotes.

2.             The undersigned has reviewed and is familiar with the terms of
the Agreement and has made, or has caused to be made under his/her supervision,
a review in reasonable detail of the transactions and condition (financial or
otherwise) of the Domestic Borrower during the accounting period covered by the
attached financial statements.

C-1

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

3.             A review of the activities of the Borrowers during such fiscal
period has been made under the supervision of the undersigned with a view to
determining whether during such fiscal period the Borrowers performed and
observed all their respective Obligations under the Loan Documents, and

[select one:]

[to the best knowledge of the undersigned during such fiscal period, the
Borrowers performed and observed each covenant and condition of the Loan
Documents applicable to them, and no Default has occurred and is continuing.]

—or—

[the following covenants or conditions have not been performed or observed and
the following is a list of each such Default and its nature and status:]

4.             The financial covenant analyses and information set forth on
Schedule 2 attached hereto are true and accurate on and as of the date of this
Certificate.

[Use following paragraph 5 for annual deliveries of the Certificate]

5.             Attached hereto as Schedule 3 is a supplement to Schedule
[II]/[IV] ([locations at which Goods are kept]/[Intellectual Property]) to the
Security Agreement.

IN WITNESS WHEREOF, the undersigned has executed this Certificate as
of                                      ,                           .

GUESS?, INC.

 

 

 

 

 

By:

 

 

 

 

 

 

 

Name:

 

 

 

 

 

 

 

Title:

 

 

 

C-2

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

For the Quarter/Year ended                              (“Statement Date”)(1)

SCHEDULE 2
to the Compliance Certificate
($ in 000’s)

I.              Section 7.11(a) – Total Adjusted Leverage Ratio.

A.

The sum of

 

 

 

 

 

 

 

1.

Consolidated Funded Indebtedness as of the Statement Date, and

$

 

 

 

 

 

 

 

2.

Eight times the real property rental expense of the Domestic Borrower and its
Subsidiaries for the most recently completed period of four fiscal quarters

$

 

 

 

 

 

 

 

3.

Line I.A.1 plus Line I.A.2

$

 

 

 

 

 

 

B.

EBITDAR for four consecutive fiscal quarters ending on above date (“Subject
Period”):

 

 

 

 

 

 

 

1.

Consolidated Net Income (including income recognized from deferred revenues on
payments by licensees) for Subject Period:

$

 

 

 

 

 

 

 

2.

Consolidated Interest Charges for Subject Period:

$

 

 

 

 

 

 

 

3.

Provision for income taxes for Subject Period:

$

 

 

 

 

 

 

 

4.

Depreciation expenses for Subject Period:

$

 

 

 

 

 

 

 

5.

Amortization expenses (including stock-based award expense amortizations) for
Subject Period:

$

 

 

 

 

 

 

 

6.

Real property rental expense for Subject Period:

$

 

 

 

 

 

 

 

7.

Customary fees, costs and expenses incurred in connection with any equity or
debt offering, Investments or Indebtedness permitted by the Agreement or in
connection with the consummation of acquisitions permitted pursuant to Section
7.03(h) for Subject Period:

$

 

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

(1)   In the event the Domestic Borrower changes its fiscal year or fiscal
quarter end dates, all calculations of financial covenants set forth in this
Schedule 2 will be performed using such new dates as if the prior fiscal
quarters had ended on such new dates.

C-3

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

 

 

8.

Restructuring charges or reserves (including, without limitation, non-cash
retention, severance, systems establishment costs, excess pension charges,
contract termination costs including future lease commitments, and costs to
consolidate facilities and relocate employees) for Subject Period (not to exceed
$50,000,000 in the aggregate through the Maturity Date):

$

 

 

 

 

 

 

 

9.

Other non-recurring expenses (excluding losses generated from barter
transactions) during Subject Period reducing such Consolidated Net Income which
do not represent a cash item in the Subject Period or any future period:

$

 

 

 

 

 

 

 

10.

Federal, state, local and foreign income Tax credits (to the extent included in
calculating such Consolidated Net Income) for Subject Period:

$

 

 

 

 

 

 

 

11.

All non-recurring non-cash items (excluding gains generated from barter
transactions) increasing Consolidated Net Income for Subject Period:

$

 

 

 

 

 

 

 

12.

EBITDAR (Lines I.B.1 + 2 + 3 + 4 + 5 + 6 + 7 + 8 + 9 — 10 — 11):

$

 

 

 

 

 

 

C.

Total Adjusted Leverage Ratio (Line I.A.3 ¸ Line I.B.12):

                        to 1

 

 

 

 

 

 

Maximum permitted:

 

 

Four Fiscal Quarters Ending

 

Maximum Total
Adjusted
Leverage Ratio

 

Closing Date through the last day of the first fiscal quarter of fiscal year
2009

 

4.50 to 1.00

 

The second fiscal quarter of fiscal year 2009 and each fiscal quarter thereafter

 

4.25 to 1.00

 

 

II.            Section 7.11(b) – Consolidated Fixed Charge Coverage Ratio.

 

A.

1.

EBITDAR for the Subject Period (Line I.B.12 above):

$

 

 

 

 

 

 

 

2.

Federal, state, local and foreign income taxes paid in cash for the Subject
Period:

$

 

C-4

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

 

 

3.

Maintenance Capital Expenditures for the Subject Period (but in no event less
than $10,000,000):

$

 

 

 

 

 

 

 

4.

Lines II.A.1 – 2 – 3:

$

 

 

 

 

 

 

B.

The sum of

 

 

 

 

 

 

 

 

1.

Consolidated Interest Charges for Subject Period:

$

 

 

 

 

 

 

 

2.

All regularly scheduled and/or contractual principal payments or redemptions of
debt for Subject Period (excluding debt refinanced):

$

 

 

 

 

 

 

 

3.

Real property rental expense for Subject Period:

$

 

 

 

 

 

 

 

4.

Restricted Payments (exclusive of those permitted under Section 7.06(e)) for the
Subject Period:

$

 

 

 

 

 

 

 

5.

Lines II.B.1 + 2 + 3 + 4:

$

 

 

 

 

 

 

C.

Consolidated Fixed Charge Coverage Ratio (Line II.A.4 ¸ Line II.B.5):

 

to 1

 

 

 

 

 

 

 

Minimum required:

 

 

Four Fiscal Quarters Ending

 

Minimum
Consolidated
Fixed Charge
Coverage Ratio

 

Closing Date through the last day of the first fiscal quarter of fiscal year
2009

 

1.10 to 1.00

 

The second fiscal quarter of fiscal year 2009 and each fiscal quarter thereafter

 

1.20 to 1.00

 

 

III.           Calculation of Basket Usage.

A.

Indebtedness – Section 7.02

 

 

 

 

 

 

 

 

(i)

Debt permitted under 7.02(g)

 

 

 

 

(not to exceed $35,000,000):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(ii)

Aircraft lease not to exceed $20,000,000):

$

 

C-5

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

 

 

(iii)

Foreign Subsidiary debt

 

 

 

(not to exceed $50,000,000):

 

 

 

 

 

 

 

 

 

 

 

 

 

B.

Investments – Section 7.03

 

 

 

 

 

 

(i)

Minority Equity Interests in foreign Persons

 

 

 

(not to exceed $50,000,000):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(ii)

Acquisitions under Section 7.03(h):

 

 

 

 

 

 

 

(a)

Cash consideration

 

 

 

 

(not to exceed $125,000,000):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(b)

Total consideration

 

 

 

 

(not to exceed $150,000,000):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(iii)

Investments in publicly traded securities (not to exceed $4,000,000 plus the
amount of proceeds from the sale of such securities):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(iv)

Investments in domestic Persons (not to exceed $35,000,000):

 

 

 

 

 

 

 

 

 

 

 

 

 

C-6

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

EXHIBIT D

ASSIGNMENT AND ASSUMPTION

This Assignment and Assumption (this “Assignment and Assumption”) is dated as of
the Effective Date set forth below and is entered into by and between [Insert
name of Assignor] (the “Assignor”) and [Insert name of Assignee] (the
“Assignee”).  Capitalized terms used but not defined herein shall have the
meanings given to them in the Credit Agreement identified below (the “Credit
Agreement”), receipt of a copy of which is hereby acknowledged by the Assignee. 
The Standard Terms and Conditions set forth in Annex 1 attached hereto are
hereby agreed to and incorporated herein by reference and made a part of this
Assignment and Assumption as if set forth herein in full.

For an agreed consideration, the Assignor hereby irrevocably sells and assigns
to the Assignee, and the Assignee hereby irrevocably purchases and assumes from
the Assignor, subject to and in accordance with the Standard Terms and
Conditions and the Credit Agreement, as of the Effective Date inserted by the
[Domestic/Canadian] Administrative Agent as contemplated below (i) all of the
Assignor’s rights and obligations as a Lender under the Credit Agreement and any
other documents or instruments delivered pursuant thereto to the extent related
to the amount and percentage interest identified below of all of such
outstanding rights and obligations of the Assignor under the respective
facilities identified below (including, without limitation, the Letters of
Credit included in such facilities) and (ii) to the extent permitted to be
assigned under applicable law, all claims, suits, causes of action and any other
right of the Assignor (in its capacity as a Lender) against any Person, whether
known or unknown, arising under or in connection with the Credit Agreement, any
other documents or instruments delivered pursuant thereto or the loan
transactions governed thereby or in any way based on or related to any of the
foregoing, including, but not limited to, contract claims, tort claims,
malpractice claims, statutory claims and all other claims at law or in equity
related to the rights and obligations sold and assigned pursuant to clause (i)
above (the rights and obligations sold and assigned pursuant to clauses (i) and
(ii) above being referred to herein collectively as, the “Assigned Interest”). 
Such sale and assignment is without recourse to the Assignor and, except as
expressly provided in this Assignment and Assumption, without representation or
warranty by the Assignor.

(i)                                    
Assignor:                                                                                            

(ii)                                  Assignee:             
                                                                              
[and is an Affiliate/Approved Fund of [identify Lender](2)]

(iii)                               Borrowers:             Guess?, Inc. and
Guess? Canada Corporation

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

(2)           Select as applicable

D-1

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

(iv)                              Domestic Administrative Agent:  Bank of
America, N.A., as the domestic administrative agent under the Credit Agreement.

(v)                                 Canadian Administrative Agent:  Bank of
America, N.A., acting through its Canada Branch.

(vi)                              Credit Agreement:  Credit Agreement, dated as
of September 19, 2006, among Guess?, Inc., a Delaware corporation (the “Domestic
Borrower”), Guess? Canada Corporation, a Canadian corporation and wholly-owned
subsidiary of the Domestic Borrower (together with the Domestic Borrower,
collectively, the “Borrowers” and individually, a “Borrower”), each lender from
time to time party thereto (collectively, the “Lenders” and individually, a
“Lender”), Bank of America, N.A., as Domestic Administrative Agent and Domestic
L/C Issuer, and Bank of America, N.A., acting through its Canada Branch, as
Canadian Administrative Agent and Canadian L/C Issuer.

(vii)                           Assigned Interest:

Facility Assigned

 

Aggregate
Amount of
Commitment 
for all Lenders*

 

Amount of
Commitment
Assigned*

 

Percentage
Assigned of
Commitment(3)

 

CUSIP Number

 

Domestic Facility

 

$

 

 

$

 

 

 

%

 

 

Canadian Facility

 

$

 

 

$

 

 

 

%

 

 

 

 

$

 

 

$

 

 

 

%

 

 

 

(viii)                        [Trade Date:                         
                                 ](4)

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

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

*    Amount to be adjusted by the counterparties to take into account any
payments or prepayments made between the Trade Date and the Effective Date.

(3)  Set forth, to at least 9 decimals, as a percentage of the Commitment/Loans
of all Lenders thereunder.

(4)  To be completed if the Assignor and the Assignee intend that the minimum
assignment amount is to be determined as of the Trade Date.

D-2

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

The terms set forth in this Assignment and Assumption are hereby agreed to:

 

ASSIGNOR

 

[NAME OF ASSIGNOR]

 

 

 

 

 

By:

 

 

 

Title:

 

 

 

 

 

ASSIGNEE

 

[NAME OF ASSIGNEE]

 

 

 

 

 

By:

 

 

 

Title:

 

 

[Consented to and] Accepted:

 

 

 

BANK OF AMERICA, N.A., as Domestic

 

  Administrative Agent

 

 

 

By:

 

 

 

Title:

 

 

 

[OR]

 

 

 

[Consented to and] Accepted:

 

 

 

BANK OF AMERICA, N.A.,

 

  acting through its Canada branch, as

 

  Canadian Administrative Agent

 

 

 

By:

 

 

 

Title:

 

 

 

[Consented to]:

 

 

 

GUESS?, INC.,

 

 

 

By:

 

 

 

Title:

 

 

D-3

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

 

[OR]

 

 

 

[Consented to]:

 

 

 

GUESS? CANADA CORPORATION

 

 

 

By:

 

 

 

Title:

 

 

D-4

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

ANNEX 1 TO ASSIGNMENT AND ASSUMPTION

GUESS?, INC. and GUESS? CANADA CORPORATION CREDIT AGREEMENT

STANDARD TERMS AND CONDITIONS FOR

ASSIGNMENT AND ASSUMPTION

1.             Representations and Warranties.

1.1.          Assignor.  The Assignor (a) represents and warrants that (i) it is
the legal and beneficial owner of the Assigned Interest, (ii) the Assigned
Interest is free and clear of any lien, encumbrance or other adverse claim and
(iii) it has full power and authority, and has taken all action necessary, to
execute and deliver this Assignment and Assumption and to consummate the
transactions contemplated hereby; and (b) assumes no responsibility with respect
to (i) any statements, warranties or representations made in or in connection
with the Credit Agreement or any other Loan Document, (ii) the execution,
legality, validity, enforceability, genuineness, sufficiency or value of the
Loan Documents or any collateral thereunder, (iii) the financial condition of
the Borrower, any of its Subsidiaries or Affiliates or any other Person
obligated in respect of any Loan Document or (iv) the performance or observance
by the Borrower, any of its Subsidiaries or Affiliates or any other Person of
any of their respective obligations under any Loan Document.

1.2.          Assignee.  The Assignee (a) represents and warrants that (i) it
has full power and authority, and has taken all action necessary, to execute and
deliver this Assignment and Assumption and to consummate the transactions
contemplated hereby and to become a Lender under the Credit Agreement, (ii) it
meets all requirements of an Eligible Assignee under the Credit Agreement
(subject to receipt of such consents as may be required under the Credit
Agreement), (iii) from and after the Effective Date, it shall be bound by the
provisions of the Credit Agreement as a Lender thereunder and, to the extent of
the Assigned Interest, shall have the obligations of a Lender thereunder, (iv)
it is sophisticated with respect to decisions to acquire assets of the type
represented by the Assigned Interest and either it, or the person exercising
discretion in making its decision to acquire the Assigned Interest, is
experienced in acquiring assets of such type, (v) it has received a copy of the
Credit Agreement, and has received or has been accorded the opportunity to
receive copies of the most recent financial statements delivered pursuant to
Section 6.01 thereof, as applicable, and such other documents and information as
it has deemed appropriate to make its own credit analysis and decision to enter
into this Assignment and Assumption and to purchase the Assigned Interest, (vi)
it has, independently and without reliance upon the Administrative Agent 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
Assignment and Assumption and to purchase the Assigned Interest, on the basis of
which it has made such analysis and decision independently and without reliance
on the Administrative Agent or any other Lender, and (vii) if it is a Foreign
Lender, attached hereto is any documentation required to be delivered by it
pursuant to the terms of the Credit Agreement, duly completed and executed by
the Assignee; and (b) agrees that (i) it will, independently and without
reliance on the Administrative Agent, the Assignor or any other

D-5

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

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 Loan Documents, and (ii) it will perform in accordance with
their terms all of the obligations which by the terms of the Loan Documents are
required to be performed by it as a Lender.

2.             Payments.  From and after the Effective Date, the Administrative
Agent shall make all payments in respect of the Assigned Interest (including
payments of principal, interest, fees and other amounts) to the Assignor for
amounts which have accrued to but excluding the Effective Date and to the
Assignee for amounts which have accrued from and after the Effective Date.

3.             General Provisions.  This Assignment and Assumption shall be
binding upon, and inure to the benefit of, the parties hereto and their
respective successors and assigns.  This Assignment and Assumption may be
executed in any number of counterparts, which together shall constitute one
instrument.  Delivery of an executed counterpart of a signature page of this
Assignment and Assumption by telecopy shall be effective as delivery of a
manually executed counterpart of this Assignment and Assumption.  This
Assignment and Assumption shall be governed by, and construed in accordance
with, the law of the State of California.

D-6

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

 

EXHIBIT E

GUARANTY

GUARANTY dated as of September 19, 2006 (the “Guaranty”) made by Guess?, Inc., a
Delaware corporation (the “Domestic Borrower”), Guess? Retail, Inc., a Delaware
corporation, Guess? Value LLC, a Virginia limited liability company, Guess?
Bermuda Holdings, LLC, a Delaware limited liability company and Guess.com, Inc.,
a Delaware corporation (together with any future Domestic Subsidiary (as defined
in the Credit Agreement referred to below), if any, that becomes a party to this
Guaranty, a “Guarantor” and collectively, the “Guarantors”) in favor of each of
the Administrative Agents (as hereinafter defined) and the Lender Parties (as
defined below).

PRELIMINARY STATEMENTS:

(1)           The Domestic Borrower, Guess? Canada Corporation, a Canadian
corporation and wholly-owned subsidiary of the Domestic Borrower (the “Canadian
Borrower” and together with the Domestic Borrower, collectively the
“Borrowers”), various lenders (the “Lenders”), Bank of America, N.A., as
domestic administrative agent for certain of the lenders (in such capacity, the
“Domestic Administrative Agent”) and Bank of America, N.A., acting through its
Canada Branch, as Canadian administrative agent for certain of the Lenders (in
such capacity, the “Canadian Administrative Agent” and together with the
Domestic Administrative Agent, the “Administrative Agents”) have entered into a
Credit Agreement dated as of the date hereof (said Agreement, as it may
hereafter be amended or otherwise modified from time to time, being the “Credit
Agreement”; capitalized terms used herein and not otherwise defined herein shall
have the meanings assigned to such terms in the Credit Agreement), pursuant to
which the Lenders have, among other things, and subject to the terms and
conditions set forth in the Credit Agreement, agreed to make Loans and Letters
of Credit available to the Borrowers.

(2)           It is a condition precedent to the making of Loans and the
issuance of Letters of Credit by the L/C Issuers under the Credit Agreement that
each Guarantor shall have executed and delivered this Guaranty.

(3)           The Guarantors have duly authorized the execution, delivery and
performance of this Guaranty.

(4)           Each Guarantor hereby confirms that it will derive substantial
direct and indirect benefit from the transactions contemplated by the Credit
Agreement.

NOW, THEREFORE, in consideration of the premises and in order to induce the
Lenders to make Loans and to issue Letters of Credit under the Credit Agreement
for the benefit of the Borrowers from time to time, each Guarantor hereby agrees
as follows:

Section 1.  Guaranty: Limitation of Liability.

(a)           Subject to the final sentence of this subsection, each of the
Guarantors hereby jointly and severally unconditionally and irrevocably, as
primary obligor and not merely as

E-1

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

surety, guarantees the full and prompt payment when due, whether by acceleration
or otherwise, and at all times thereafter, of (a) all obligations of the
Borrowers howsoever created, arising or evidenced, whether director or indirect,
absolute or contingent, now or hereafter existing, or due or to become due,
which arise out of or in connection with the Credit Agreement or any other Loan
Document, as the same may be amended, modified, extended or renewed from time to
time, (b) all obligations of the Borrowers to any Lender Party (as defined
below) under any Swap Contract and (c) all costs and expenses paid or incurred
by the Administrative Agents or any Lender Party in enforcing this Guaranty or
any other applicable Loan Document against such Guarantor (all such obligations
being herein collectively called the “Guaranteed Obligations”).  As used herein,
“Lender Party” means each Lender and any Affiliate of such Lender which is a
party to a Swap Contract with either of the Borrowers.  Without limiting the
generality of the foregoing, each Guarantor’s liability shall extend to all
amounts that constitute part of the Guaranteed Obligations and would be owed by
either of the Borrowers to the Administrative Agents or any Lender Party under
the Loan Documents but for the fact that they are unenforceable or not allowable
due to the existence of a bankruptcy, reorganization or similar proceeding
involving the Borrowers.  It is understood and agreed that the Domestic Borrower
is executing this Guaranty to evidence its guaranty of the obligations of the
Canadian Borrower to the Lender Parties; it is not guarantying its own primary
obligations to the Lender Parties.

(b)           This Guaranty constitutes a guaranty by each Guarantor of payment
when due and not of collection, and each Guarantor specifically agrees that it
shall not be necessary or required that the Administrative Agents or any Lender
exercise any right, assert any claim or demand or enforce any remedy whatsoever
against the Borrowers (or any other Person) before or as a condition to the
obligations of such Guarantor hereunder.

(c)           Any term or provision of this Guaranty or any other Loan Document
to the contrary notwithstanding, the aggregate maximum amount of the Guaranteed
Obligations for which each Guarantor (other than the Domestic Borrower) shall be
liable shall not exceed the maximum amount for which such Guarantor can be
liable without rendering this Guaranty or any other Loan Document as it relates
to such Guarantor, voidable under applicable law relating to fraudulent
conveyance or fraudulent transfer.  The obligations of the Domestic Borrower
hereunder shall be unlimited.

Section 2.  Guaranty Absolute.  Each Guarantor guarantees that the Guaranteed
Obligations will be paid strictly in accordance with the terms of the Loan
Documents, regardless of any law, regulation or order now or hereafter in effect
in any jurisdiction affecting any of such terms or the rights of the
Administrative Agents or any Lender Party with respect thereto.  The Obligations
of each Guarantor under this Guaranty are independent of the Guaranteed
Obligations or any other Obligations of any other Loan Party under the Loan
Documents, and a separate action or actions may be brought and prosecuted
against any Guarantor to enforce this Guaranty, irrespective of whether any
action is brought against the Borrowers or any other Loan Party or whether the
Borrowers or any other Loan Party is joined in any such action or actions.  The
creation or existence from time to time of additional Guaranteed Obligations to
the Administrative Agents or the Lender Parties or any of them is authorized,
without notice to any Guarantor, and shall in no way impair the rights of the
Administrative Agents or the Lender Parties or the obligations of any Guarantor
under this Guaranty, including the Guaranty hereunder of such additional
Guaranteed Obligations.  The liability of each Guarantor under this

E-2

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

Guaranty shall be irrevocable, absolute and unconditional irrespective of, and
each Guarantor hereby irrevocably waives any defenses it may now or hereafter
have in any way relating to, any or all of the following to the fullest extent
permitted by applicable law:

(a)           any lack of validity, legality or enforceability of the Credit
Agreement or any Loan Document;

(b)           the failure of the Administrative Agents or any Lender:

(i)            to assert any claim or demand or to enforce any right or remedy
against the Borrowers or any other Person (including any other guarantor) under
the provisions of the Credit Agreement, any other Loan Document or otherwise, or

(ii)           to exercise any right or remedy against any other guarantor of,
or collateral securing, any Guaranteed Obligations;

(c)           any change in the time, manner or place of payment of, or in any
other term of, all or any of the Guaranteed Obligations, or any other extension,
compromise or renewal of any Guaranteed Obligation;

(d)           any reduction, limitation, impairment or termination of any
Guaranteed Obligations for any reason, including any claim of waiver, release,
surrender, alteration or compromise, and shall not be subject to (and such
Guarantor hereby waives any right to or claim of) any defense or setoff,
counterclaim, recoupment or termination whatsoever by reason of the invalidity,
illegality, nongenuineness, irregularity, compromise, unenforceability of, or
any other event or occurrence affecting, any Guaranteed Obligations;

(e)           any amendment to, rescission, waiver, or other modification of, or
any consent to departure from, any of the terms of the Credit Agreement or any
other Loan Document;

(f)            (i) any addition, exchange, release, surrender or non-perfection
of any collateral or (ii) any amendment to or waiver or release or addition of,
or consent to departure from, any other guaranty held by the Administrative
Agents or any Lender, securing or supporting any of the Guaranteed Obligations;

(g)           any other circumstance which might otherwise constitute a defense
available to, or a legal or equitable discharge of, any Guarantor, the
Borrowers, any surety or any other guarantor; or

(h)           any failure of the Administrative Agents or any Lender Party to
disclose to the Borrowers or each Guarantor any information relating to the
financial condition, operations, properties or prospects of any other Loan Party
now or in the future known to the Administrative Agents or any Lender Party
(each Guarantor waiving any duty on the part of the Administrative Agents or the
Lender Parties to disclose such information).

This Guaranty shall continue to be effective or be reinstated, as the case may
be, if at any time any payment (in whole or in part) of any of the Guaranteed
Obligations is rescinded or must otherwise be returned by the Administrative
Agents or any Lender Party or any other Person

E-3

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

upon the insolvency, bankruptcy or reorganization of the Borrowers or any other
Loan Party or otherwise, all as though such payment had not been made.

Section 3.  Waivers and Acknowledgments.

(a)           Each Guarantor hereby waives promptness, diligence, notice of
acceptance and any other notice with respect to any of the Guaranteed
Obligations and this Guaranty and any requirement that the Administrative Agents
or any Lender Party protect, secure, perfect or insure any security interest or
Lien, or any property subject thereto, or exhaust any right or take any action
against the Borrowers or any other Person (including any Guarantor) or entity or
any collateral securing any Guaranteed Obligations.

(b)           Each Guarantor hereby irrevocably waives any right to revoke this
Guaranty, and acknowledges that this Guaranty is continuing in nature and
applies to all Guaranteed Obligations, whether existing now or in the future (it
being understood and agreed that if, notwithstanding the foregoing, any such
revocation shall occur or be attempted, such revocation shall not in any event
reduce or otherwise affect any Guarantor’s liability with respect to Guaranteed
Obligations arising prior to receipt by the Administrative Agents and the Lender
Parties of written notice of such revocation or attempted revocation).

(c)           Each Guarantor hereby waives to the fullest extent permitted by
applicable law: (i) any rights to assert against the Administrative Agents and
the Lender Parties any defense (legal or equitable), set-off, counterclaim, or
claim which such Guarantor may now or at any time hereafter have against
Borrowers or any other party liable to the Administrative Agents and the Lender
Parties; (ii) any defense, set-off, counterclaim, or claim, of any kind or
nature, arising directly or indirectly from the present or future lack of
perfection, sufficiency, validity, or enforceability of the Guaranteed
Obligations or any security therefor; (iii) any defense arising by reason of any
claim or defense based upon an election of remedies by the Administrative Agents
or the Lender Parties; (iv) any act which shall defer or delay the operation of
any statute of limitations applicable to the Guaranteed Obligations shall
similarly operate to defer or delay the operation of such statute of limitations
applicable to such Guarantor’s liability hereunder; and (v) any defense or
benefit that may be derived from or afforded by law which limits the liability
of or exonerates guaranties or sureties or requires the Administrative Agents or
the Lender Parties to exhaust remedies against the Borrowers prior to commencing
any action or foreclosure against such Guarantor or its properties including,
without limitation, the benefits of Sections 2787 through 2855, inclusive, and
Sections 2899 and 3433 of the California Civil Code and any successor provisions
to such Sections, or any similar provisions under United States or Canadian law.

(d)           Each Guarantor agrees that if all or a portion of the Obligations
or this Guaranty is at any time secured by a deed of trust or mortgage covering
interests in real property, the Administrative Agents and the Lender Parties, in
their sole discretion, without notice or demand and without affecting the
liability of such Guarantor under this Guaranty, may foreclose pursuant to the
terms of the Credit Agreement or otherwise the deed of trust or mortgage and the
interests in real property secured thereby by non-judicial sale.  Each Guarantor
understands that the exercise by the Administrative Agents or the Lender Parties
of certain rights and remedies contained in the Credit Agreement and any such
deed of trust or mortgage may affect or

E-4

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

eliminate such Guarantor’s right of subrogation against Borrowers and that such
Guarantor may therefore incur a partially or totally non-reimbursable liability
hereunder.  Nevertheless, each Guarantor hereby authorizes and empowers the
Administrative Agents or the Lender Parties to exercise, in their sole
discretion, any rights and remedies, or any combination thereof, which may then
be available, since it is the intent and purpose of such Guarantor that the
obligations hereunder shall be absolute, independent and unconditional under any
and all circumstances.  Notwithstanding any foreclosure of the lien of any deed
of trust or security agreement with respect to any or all of any real or
personal property secured thereby, whether by the exercise of the power of sale
contained therein, by an action for judicial foreclosure or by an acceptance of
a deed in lieu of foreclosure, each Guarantor shall remain bound under this
Guaranty including its obligation to pay any deficiency following a non-judicial
foreclosure to the fullest extent permitted by applicable law.

(e)           Each Guarantor acknowledges that it will receive substantial
direct and indirect benefits from the financing arrangements contemplated by the
Loan Documents and that the waivers set forth in this Section 3 are knowingly
made in contemplation of such benefits.

Section 4.  Subrogation.  Each Guarantor agrees that it will not exercise any
rights that it may now or hereafter acquire against the Borrowers or any other
Person that arise from the existence, payment, performance or enforcement of
such Guarantor’s obligations under this Guaranty or any other Loan Document,
including, without limitation, any right of subrogation, reimbursement,
exoneration, contribution or indemnification and any right to participate in any
claim or remedy of the Administrative Agents or any Lender Party against the
Borrowers or any other Person or any collateral which the Administrative Agents
or any Lender Party now has or hereafter acquires, whether or not such claim,
remedy or right arises in equity or under contract, statute or common law,
including, without limitation, the right to take or receive from the Borrowers
or any Person, directly or indirectly, in cash or other property or by set-off
or in any other manner, payment or security on account of such claim, remedy or
right, unless and until all of the Guaranteed Obligations and all other amounts
payable under this Guaranty shall have been paid in full in cash and the
Commitments shall have expired or terminated.  If any amount shall be paid to
any Guarantor in violation of the preceding sentence at any time prior to the
later of (i) the payment in full in cash of the Guaranteed Obligations and all
other amounts payable under this Guaranty and (ii) the Maturity Date, such
amount shall be held in trust for the benefit of the Administrative Agents and
the Lender Parties and shall forthwith be paid to the Administrative Agents to
be credited and applied to the Guaranteed Obligations and any other amounts
payable under this Guaranty whether matured or unmatured, in accordance with the
terms of the Loan Documents, or to be held as collateral for any Guaranteed
Obligations or other amounts payable under this Guaranty thereafter arising.  If
(i) a Guarantor shall make payment to the Administrative Agents or any Lender
Party of all or any part of the Guaranteed Obligations, (ii) all of the
Guaranteed Obligations and all other amounts payable under this Guaranty shall
be paid in full in cash and (iii) the Maturity Date shall have occurred, the
Administrative Agents and the Lender Parties shall, at such Guarantor’s request
and expense, execute and deliver to such Guarantor appropriate documents,
without recourse and without representation or warranty, necessary to evidence
the transfer by subrogation to such Guarantor of an interest in the Guaranteed
Obligations resulting from such payment by such Guarantor.

E-5

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

Section 5.  Payments Free and Clear of Taxes, Etc.

(a)           Any and all payments made by any Guarantor hereunder to or for the
account of the Administrative Agents or any Lender Party shall be made, in
accordance with and subject to Section 3.01 of the Credit Agreement, free and
clear of and without reduction or withholding for any Indemnified Taxes or Other
Taxes, provided that if such Guarantor shall be required by applicable law to
deduct or withhold any Indemnified Taxes (including any Other Taxes) from such
payments, then (i) the sum payable shall be increased as necessary so that after
making all required deductions or withholdings (including deductions applicable
to additional sums payable under this Section) the applicable Administrative
Agent or Lender Party, as the case may be, receives an amount equal to the sum
it would have received had no such deductions or withholdings been made, (ii)
the applicable Guarantor shall make such deductions or withholdings and (iii)
the applicable Guarantor shall timely pay the full amount deducted or withheld
to the relevant Governmental Authority in accordance with applicable law.

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

(c)           Each Guarantor will indemnify the Administrative Agents and each
Lender Party, within 10 days after demand therefor, for the full amount of any
Indemnified Taxes or Other Taxes (including Indemnified Taxes or Other Taxes
imposed or asserted on or attributable to amounts payable under this Section)
paid by such Administrative Agent or Lender Party, as the case may be, and any
penalties, interest and reasonable expenses arising therefrom or with respect
thereto, whether or not such Indemnified Taxes or Other Taxes were correctly or
legally imposed or asserted by the relevant Governmental Authority.  A
certificate as to the amount of such payment or liability delivered to the
applicable Guarantor by a Lender Party (with a copy to the applicable
Administrative Agent), or by an Administrative Agent on its own behalf or on
behalf of a Lender Party, shall be conclusive absent manifest error.

(d)           As soon as practicable after any payment of Indemnified Taxes or
Other Taxes by a Guarantor to a Governmental Authority, such Guarantor shall
deliver to the applicable Administrative 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 such Administrative Agent.

(e)           Any Lender Party that is entitled to an exemption from or
reduction of withholding Tax under the law of the jurisdiction in which a
Guarantor is resident for Tax purposes, or any treaty to which such jurisdiction
is a party, with respect to payments hereunder or under any other Loan Document
shall, if requested by a Guarantor or the applicable Administrative Agent,
deliver to such Guarantor (with a copy to the applicable Administrative Agent),
at the time or times prescribed by applicable law or reasonably requested by
such Guarantor or such Administrative Agent, such properly completed and
executed documentation prescribed by applicable law as will permit such payments
to be made without withholding or at a reduced rate of withholding.  In
addition, any Lender, if requested by a Guarantor or the applicable
Administrative Agent, shall deliver such other documentation prescribed by
applicable law or reasonably requested by such Guarantor or such Administrative
Agent as will

E-6

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

enable such Guarantor or such Administrative Agent to determine whether or not
such Lender Party is subject to backup withholding or information reporting
requirements.

(f)            If an Administrative Agent or any Lender Party determines, in its
good faith discretion, that it has received a refund of any Taxes or Other Taxes
as to which it has been indemnified by a Guarantor or with respect to which a
Guarantor has paid additional amounts pursuant to this Section, it shall pay to
such Guarantor an amount equal to such refund (but only to the extent of
indemnity payments made, or additional amounts paid, by such Guarantor under
this Section with respect to the Taxes or Other Taxes giving rise to such
refund), net of all out of pocket expenses of such Administrative Agent or such
Lender Party, as the case may be, and without interest (other than any interest
paid by the relevant Governmental Authority with respect to such refund),
provided that such Guarantor, upon the request of such Administrative Agent or
such Lender Party, agrees to repay the amount paid over to such Guarantor (plus
any penalties, interest or other charges imposed by the relevant Governmental
Authority) to such Administrative Agent or such Lender Party if such
Administrative Agent or such Lender Party is required to repay such refund to
such Governmental Authority.  This subsection shall not be construed to require
any Administrative Agent or any Lender Party to make available its Tax returns
(or any other information relating to its Taxes that it deems confidential) to
any Guarantor.

(g)           If a Guarantor determines in good faith that a reasonable basis
exists for contesting a Tax or Other Tax with respect to which such Guarantor
has paid an additional amount under this Section, the relevant Administrative
Agent or Lender Party, as applicable, shall cooperate with such Guarantor (but
shall have no obligation to disclose any confidential information, unless
arrangements satisfactory to the relevant Lender Party have been made to
preserve the confidential nature of such information) in challenging such Tax or
Other Tax at the Guarantor’s expense if requested by such Guarantor (it being
understood and agreed that none of the Administrative Agents or any Lender Party
shall have any obligation to contest, or any responsibility for contesting, any
Tax), and any cost incurred by the relevant Administrative Agent or Lender Party
in connection with its cooperation shall be borne by the relevant Guarantor.

Section 6.  Representations and Warranties.  Each Guarantor hereby represents
and warrants that such Guarantor has, independently and without reliance upon
the Administrative Agents or any Lender Party and based on such documents and
information as it has deemed appropriate, made its own credit analysis and
decision to enter into this Guaranty, and such Guarantor has established
adequate means of obtaining from any other Loan Parties on a continuing basis
information pertaining to, and is now and on a continuing basis will be
completely familiar with, the financial condition, operations, properties and
prospects of such other Loan Parties.

Section 7.  Affirmative Covenants.  Each Guarantor covenants and agrees that, so
long as any part of the Guaranteed Obligations shall remain unpaid, any Letter
of Credit shall be outstanding or any Lender Party shall have any Commitment,
if, under the terms of the Credit Agreement, the Borrowers are required to cause
such Guarantor or any of such Guarantor’s Subsidiaries to take, or to refrain
from taking, any action, or to comply with any requirements, obligations,
limitations or restrictions contained therein, in each case whether individually
or

E-7

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

together with any other Loan Parties, such Guarantor shall, and shall cause any
such Subsidiaries to, take or refrain from taking (as the case may be) any such
action and comply with all such requirements, obligations, limitations and
restrictions and not take any action that would create an Event of Default.

Section 8.  Amendments, Etc.  No amendment or waiver of any provision of this
Guaranty and no consent to any departure by any Guarantor therefrom shall in any
event be effective unless the same shall be in writing and signed by the
Administrative Agents and the Required Lenders, and then such waiver or consent
shall be effective only in the specific instance and for the specific purpose
for which given.  Anything contained herein to the contrary notwithstanding, any
amendment to this Guaranty pursuant to the form attached hereto shall be
effective upon execution by the party thereto and acceptance thereof by the
Administrative Agents, in each case without further consent by or notice to the
Required Lenders or any of the Loan Parties.

Section 9.  Notices, Etc.  All notices and other communications provided for
hereunder shall be in writing (including by facsimile communication).  All such
written notices shall be mailed, faxed or delivered to the address, facsimile
number or electronic mail address specified, in the case of any Guarantor, on
the signature pages hereto and in the case of the Administrative Agents or any
Lender Party, in the Credit Agreement, or to such other address, facsimile
number, electronic mail address or telephone number as shall be designated by
such party in a notice to the other parties.  All such notices and other
communications shall be deemed to be given or made upon the earlier to occur of
(i) actual receipt by the relevant party hereto and (ii) (A) if delivered by
hand or by courier, when signed for by or on behalf of the relevant party
hereto; (B) if delivered by mail, four Business Days after deposit in the mails,
postage prepaid; (C) if delivered by facsimile, when sent and receipt has been
confirmed by telephone; and (D) if delivered by electronic mail, when
delivered.  In no event shall a voicemail message be effective as a notice,
communication or confirmation hereunder.

Section 10.  No Waiver; Remedies.  No failure on the part of the Administrative
Agents or any Lender Party to exercise, and no delay in exercising, any right
hereunder shall operate as a waiver thereof; nor shall any single or partial
exercise of any right hereunder preclude any other or further exercise thereof
or the exercise of any other right.  The remedies herein provided are cumulative
and not exclusive of any remedies provided by law.

Section 11.  Right of Set-off.  Upon (a) the occurrence and during the
continuance of any Event of Default and (b) the making of the request or the
granting of the consent specified by Section 8.02 of the Credit Agreement to
authorize the Administrative Agents to declare the Note or Notes due and payable
pursuant to the provisions of said Section 8.02, each Lender Party 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 indebtedness at any
time owing by such Lender Party to or for the credit or the account of any
Guarantor against any and all of the Obligations of such Guarantor now or
hereafter existing under this Guaranty, whether or not such Lender Party shall
have made any demand under this Guaranty and although such Obligations may be
unmatured.  Each Lender Party agrees promptly to notify each Guarantor after any
such set-off and application; provided, however, that the failure to give such
notice shall not affect the validity of such set-off and

E-8

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

application.  The rights of each Lender Party under this Section are in addition
to other rights and remedies (including, without limitation, other rights of
set-off) that such Lender Party may have.

Section 12.  Indemnification.  Without limitation on any other obligations of
any Guarantor or remedies of the Lender Parties under this Guaranty, each
Guarantor shall, to the fullest extent permitted by law, indemnify, defend and
save and hold harmless the Administrative Agents and each Lender Party from and
against, and shall pay on demand, any and all losses, liabilities, damages,
costs, expenses and charges (including the reasonable fees and disbursements of
the Administrative Agents’ or such Lender Party’s legal counsel) suffered or
incurred by the Administrative Agents or such Lender Party as a result of any
failure of any Guaranteed Obligations to be the legal, valid and binding
obligations of the Borrowers enforceable against the Borrowers in accordance
with their terms, except that the enforceability of this Guaranty may be limited
by bankruptcy, insolvency, fraudulent conveyance, fraudulent transfer,
reorganization, moratorium or other similar laws now or hereafter in effect
relating to creditors’ rights generally and by general principles of equity
(regardless of whether enforcement is sought in a proceeding in equity or at
law).

Section 13.  Continuing Guaranty; Assignments under the Credit Agreement.  This
Guaranty is a continuing guaranty and shall (a) remain in full force and effect
until the payment in full in cash of the Guaranteed Obligations and all other
amounts payable under this Guaranty and the termination of the Commitments,
(b) be binding upon each Guarantor, its successors and assigns and (c) inure to
the benefit of and be enforceable by the Administrative Agents and the Lender
Parties and their successors, transferees and assigns.  Without limiting the
generality of the foregoing clause (c), any Lender Party may assign or otherwise
transfer all or any portion of its rights and obligations under the Credit
Agreement (including, without limitation, all or any portion of its Commitments,
the Loans owing to it and the Note or Notes held by it) to any other Person, and
such other Person shall thereupon become vested with all the benefits in respect
thereof granted to such Lender Party herein or otherwise, in each case as and to
the extent provided in Section 10.06 of the Credit Agreement.

If all of the stock of a Guarantor or any of its successors in interest under
this Guaranty shall be sold or otherwise disposed of (including by merger or
consolidation) in a sale or other disposition not prohibited by the Credit
Agreement or otherwise consented to by the Required Lenders, such Guarantor or
such successor in interest, as the case may be, may request, and the
Administrative Agents shall, upon such request, execute and deliver documents or
instruments necessary to evidence the release and discharge such Guarantor from
Guaranty.

Section 14.  Governing Law; Jurisdiction; Waiver of Jury Trial, Etc.

(a)           THIS GUARANTY SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE
WITH, THE LAWS OF THE STATE OF CALIFORNIA WITHOUT REFERENCE TO CONFLICTS OF LAW
PRINCIPLES.

(b)           ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS GUARANTY OR
ANY OTHER LOAN DOCUMENT MAY BE BROUGHT IN THE COURTS OF THE STATE OF CALIFORNIA
SITTING IN LOS ANGELES OR OF THE UNITED STATES FOR THE CENTRAL DISTRICT OF SUCH
STATE, AND BY

E-9

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

EXECUTION AND DELIVERY OF THIS AGREEMENT, EACH GUARANTOR, THE ADMINISTRATIVE
AGENTS AND EACH LENDER PARTY CONSENTS, FOR ITSELF AND IN RESPECT OF ITS
PROPERTY, TO THE NON-EXCLUSIVE JURISDICTION OF THOSE COURTS.  EACH GUARANTOR,
EACH ADMINISTRATIVE AGENT AND EACH LENDER PARTY IRREVOCABLY WAIVES ANY
OBJECTION, INCLUDING ANY OBJECTION TO THE LAYING OF VENUE OR BASED ON THE
GROUNDS OF FORUM NON CONVENIENS, WHICH IT MAY NOW OR HEREAFTER HAVE TO THE
BRINGING OF ANY ACTION OR PROCEEDING IN SUCH JURISDICTION IN RESPECT OF ANY LOAN
DOCUMENT OR OTHER DOCUMENT RELATED THERETO.  EACH GUARANTOR, THE CANADIAN
ADMINISTRATIVE AGENT AND EACH LENDER PARTY WAIVES PERSONAL SERVICE OF ANY
SUMMONS, COMPLAINT OR OTHER PROCESS, WHICH MAY BE MADE BY ANY OTHER MEANS
PERMITTED BY THE LAW OF SUCH STATE.

(c)           EACH PARTY TO THIS GUARANTY HEREBY EXPRESSLY WAIVES ANY RIGHT TO
TRIAL BY JURY OF ANY CLAIM, DEMAND, ACTION OR CAUSE OF ACTION ARISING UNDER ANY
LOAN DOCUMENT OR IN ANY WAY CONNECTED WITH OR RELATED OR INCIDENTAL TO THE
DEALINGS OF THE PARTIES HERETO OR ANY OF THEM WITH RESPECT TO ANY LOAN DOCUMENT,
OR THE TRANSACTIONS RELATED THERETO, IN EACH CASE WHETHER NOW EXISTING OR
HEREAFTER ARISING, AND WHETHER FOUNDED IN CONTRACT OR TORT OR OTHERWISE; AND
EACH PARTY HEREBY AGREES AND CONSENTS THAT ANY SUCH CLAIM, DEMAND, ACTION OR
CAUSE OF ACTION SHALL BE DECIDED BY COURT TRIAL WITHOUT A JURY, AND THAT ANY
PARTY TO THIS GUARANTY MAY FILE AN ORIGINAL COUNTERPART OR A COPY OF THIS
SECTION WITH ANY COURT AS WRITTEN EVIDENCE OF THE CONSENT OF THE SIGNATORIES
HERETO TO THE WAIVER OF THEIR RIGHT TO TRIAL BY JURY.

(d)           Section captions used in this Guaranty are for convenience of
reference only, and shall not affect the construction of this Guaranty.

(e)           Any provision of this Guaranty which is prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective
to the extent of such prohibition or unenforceability without invalidating the
remaining provisions hereof or affecting the validity or enforceability of such
provision in any other jurisdiction.

(f)            This Guaranty, taken together with all of the other Loan
Documents and all certificates and other documents delivered by the Borrowers
and the Guarantors to the Administrative Agents or the Lender Parties, embodies
the entire agreement and supersedes all prior agreements, written and oral,
relating to the subject matter hereof.

(g)           This Guaranty may be executed in any number of counterparts and by
different parties hereto in separate counterparts, each of which when so
executed shall be deemed to be an original and all of which taken together shall
constitute one and the same agreement.  Delivery of an executed counterpart of a
signature page to this Guaranty by facsimile shall be as effective as delivery
of a manually executed counterpart of this Guaranty.

E-10

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

(h)           If any action or proceeding is filed in a court of the State of
California by or against any party hereto in connection with any of the
transactions contemplated by this Guaranty or any other Loan Document, the court
shall, and is hereby directed to, make a general reference pursuant to
California Code of Civil Procedure Section 638 to a referee (who shall be a
single active or retired judge) to hear and determine all of the issues in such
action or proceeding (whether of fact or of law) and to report a statement of
decision, provided that at the option of any party to such proceeding, any such
issues pertaining to a “provisional remedy” as defined in California Code of
Civil Procedure Section 1281.8 shall be heard and determined by the court.

E-11

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

IN WITNESS WHEREOF, the undersigned have caused this Guaranty to be duly
executed and delivered by its officers thereunto duly authorized as of the date
first above written.

 

GUARANTORS:

 

 

 

GUESS?, INC.,

 

a Delaware corporation

 

 

 

 

 

By:

 

 

Name:

Carlos Alberini

 

Title:

President and Chief Operating Officer

 

 

 

Address:

1444 South Alameda Street

 

 

Los Angeles, CA 90021

E-12

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

 

GUESS? BERMUDA HOLDINGS, LLC,

 

a Delaware limited liability company

 

 

 

 

 

By:

 

 

Name:

Carlos Alberini

 

Title:

President and Chief Operating Officer

 

 

 

Address:

1444 South Alameda Street

 

 

Los Angeles, CA 90021

 

E-13

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

 

GUESS.COM, INC.,

 

a Delaware corporation

 

 

 

 

 

By:

 

 

Name:

Carlos Alberini

 

Title:

President and Chief Operating Officer

 

 

 

Address:

1444 South Alameda Street

 

 

Los Angeles, CA 90021

 

E-14

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

 

GUESS? RETAIL, INC.,

 

a Delaware corporation

 

 

 

 

 

By:

 

 

Name:

Carlos Alberini

 

Title:

President and Chief Operating Officer

 

 

 

Address:

1444 South Alameda Street

 

 

Los Angeles, CA 90021

 

E-15

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

 

GUESS? VALUE, LLC,

 

a Virginia limited liability company

 

 

 

 

 

By:

 

 

Name:

Carlos Alberini

 

Title:

President and Chief Operating Officer

 

 

 

Address:

1444 South Alameda Street

 

 

Los Angeles, CA 90021

 

E-16

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

 

AMENDMENT TO GUARANTY

This Amendment to Guaranty (this “Amendment”), dated as of          ,     ,
relates to the Guaranty dated as of September 19, 2006 (as amended to date, the
“Guaranty”), from Guess?, Inc., a Delaware corporation (the “Domestic Borrower”)
and certain Domestic Subsidiaries of the Domestic Borrower (collectively, the
“Guarantors”) in favor of the Lender Parties (as defined in the Guaranty) and
BANK OF AMERICA, as Domestic Administrative Agent (“Domestic Administrative
Agent”), and BANK OF AMERICA, N.A., acting through its Canada Branch, as
Canadian Administrative Agent (the “Canadian Administrative Agent” and together
with the Domestic Administrative Agent, the “Administrative Agents”).

In compliance with Section 6.12 of the Credit Agreement dated as of September
19, 2006 (as amended from time to time, the “Credit Agreement”) among the
Domestic Borrower, Guess? Canada Corporation, a Canadian corporation (the
“Canadian Borrower”), the Domestic Administrative Agent, the Canadian
Administrative Agent, and the Lenders party thereto, the undersigned Domestic
Subsidiary (the “Additional Guarantor”) hereby agrees as follows (capitalized
terms used but not otherwise defined herein shall have the meanings ascribed to
them in the Credit Agreement):

1.             Amendment.  The Guaranty is hereby amended to add as a party, and
more specifically, as a Guarantor, thereunder, the Additional Guarantor.

2.             Representations and Warranties.  The Additional Guarantor
represents and warrants to the Administrative Agents and the Lender Parties that
each of the representations and warranties of a Guarantor contained in the
Guaranty is hereby made by the Additional Guarantor as of the date hereof and is
true and correct, in all material respects, as to the Additional Guarantor as of
the date hereof.

3.             Additional Guarantor as Guarantor.  The Additional Guarantor
assumes all of the obligations and liabilities of a Guarantor under the
Guaranty, agrees to be bound thereby as if the Additional Guarantor were an
original party to the Guaranty and shall be a Guarantor for all purposes under
the Loan Documents.

4.             Effectiveness.  This Amendment shall become effective as of the
date hereof upon acceptance by the Domestic Administrative Agent (notice of
which is hereby waived by the Additional Guarantor).

E-17

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

5.             Governing Law.  This Amendment shall be governed by, and
construed in accordance with, the laws of the State of California.

 

[ADDITIONAL GUARANTOR]

 

 

 

 

 

By:

 

 

Name:

 

 

Title:

 

 

 

 

Notice Address:

 

 

 

 

 

Attention:

 

 

 

 

Accepted and Agreed to

 

this         day of                        , 20    :

 

BANK OF AMERICA, N.A.,

 

as Domestic Administrative Agent

 

 

 

 

 

By:

 

 

Name:

Matthew Koenig

 

Title:

Senior Vice President

 

E-18

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

EXHIBIT F

SECURITY AGREEMENT

THIS SECURITY AGREEMENT (this “Agreement”) dated as of September 19, 2006 is
among Guess ?, Inc., a Delaware corporation (the “Domestic Borrower”), each
Domestic Subsidiary (as defined in the Credit Agreement referred to below) of
the Domestic Borrower listed on the signature pages hereof, each other person or
entity which from time to time becomes a party hereto (collectively, including
the Domestic Borrower, the “Grantors” and individually each a “Grantor”) and
Bank of America, N.A., as Domestic Administrative Agent (in such capacity, the
“Domestic Administrative Agent”) for the Lenders (as defined below).

W I T N E S S E T H:

WHEREAS, the Domestic Borrower, Guess? Canada Corporation, a Canadian
corporation and wholly-owned subsidiary of the Domestic Borrower (the “Canadian
Borrower” and together with the Domestic Borrower, collectively the
“Borrowers”), various financial institutions (the “Lenders”), the Domestic
Administrative Agent and Bank of America, N.A., acting through its Canada
Branch, as Canadian administrative agent for certain of the Lenders (in such
capacity, the “Canadian Administrative Agent” and together with the Domestic
Administrative Agent, the “Administrative Agents”) have entered into that
certain Credit Agreement dated as of the date hereof (as amended, restated or
otherwise modified from time to time, the “Credit Agreement”) pursuant to which
the Lenders have, among other things, and subject to the terms and conditions
set forth in the Credit Agreement, agreed to make Loans and Letters of Credit
available to the Borrowers;

WHEREAS, certain Domestic Subsidiaries have guaranteed all of the obligations of
the Borrowers under or in connection with the Credit Agreement and certain other
obligations pursuant to a Guaranty dated as of even date herewith (the
“Guaranty”);

WHEREAS, pursuant to the Guaranty, the Domestic Borrower has guaranteed all of
the obligations of the Canadian Borrower under or in connection with the Credit
Agreement and certain other obligations;

WHEREAS, each Grantor will benefit from the making of loans and the issuance of
letters of credit and acceptances pursuant to the Credit Agreement; and

WHEREAS, the obligations of the Borrowers under the Credit Agreement and the
other Loan Documents (as defined in the Credit Agreement) and the obligation of
the Domestic Borrower and each other Grantor under the Guaranty are to be
secured pursuant to this Agreement;

NOW, THEREFORE, for and in consideration of the premises, and for other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:

F-1

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

Section 15.  Definitions.  When used herein (a) the terms Account, Account
Debtor, Certificated Security, Chattel Paper, Commercial Tort Claim, Commodity
Account, Commodity Contract, Deposit Account, Document, Equipment, Fixture,
General Intangibles, Goods, Instrument, Inventory, Investment Property,
Proceeds, Security, Securities Account, Security Entitlement and Uncertificated
Security have the meanings assigned to such terms in the UCC; (b) capitalized
terms used but not defined have the meanings assigned to such terms in the
Credit Agreement and (c) the following terms have the following meanings (such
definitions to be applicable to both the singular and plural forms of such
terms):

“Administrative Agents” is defined in the recitals.

“Agreement” is defined in the introductory paragraph.

“Assignee Deposit Account” is defined in Section 4 hereof.

“Borrowers” is defined in the recitals.

“Business Day” means any day other than a Saturday, Sunday or other day on which
commercial banks are authorized to close under the laws of, or are in fact
closed in, the state where the Administrative Agent’s office is located.

“Canadian Administrative Agent” is defined in the recitals.

“Canadian Borrower” is defined in the recitals.

“Collateral” means, with respect to any Grantor, all property and rights of such
Grantor in which a security interest is granted hereunder.

“Computer Hardware and Software” means, with respect to any Grantor, (i) all
computer and other electronic data processing hardware, whether now or hereafter
owned, licensed or leased by such Grantor, including, without limitation, all
integrated computer systems, central processing units, memory units, display
terminals, printers, features, computer elements, card readers, tape drives,
hard and soft disk drives, cables, electrical supply hardware, generators, power
equalizers, accessories and all peripheral devices and other related computer
hardware; (ii) all software programs, whether now or hereafter owned, licensed
or leased by such Grantor, designed for use on the computers and electronic data
processing hardware described in clause (i) above, including, without
limitation, all operating system software, utilities and application programs in
whatsoever form (source code and object code in magnetic tape, disk or hard copy
format or any other listings whatsoever); (iii) all firmware associated
therewith, whether now or hereafter owned, licensed or leased by such Grantor;
and (iv) all documentation for such hardware, software and firmware described in
the preceding clauses (i), (ii) and (iii), whether now or hereafter owned,
licensed or leased by such Grantor, including, without limitation, flow charts,
logic diagrams, manuals, specifications, training materials, charts and pseudo
codes.

“Costs and Expenses” means, with respect to any Grantor, all reasonable costs
and expenses (including reasonable attorneys’ fees and legal expenses) incurred
by the Domestic Administrative Agent in connection with (i) the execution,
delivery and performance of this

F-2

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

Agreement by such Grantor, (ii) protecting, preserving or maintaining any
Collateral of such Grantor, (iii) collecting the Liabilities of such Grantor and
(iv) enforcing any rights of the Domestic Administrative Agent hereunder in
respect of the Collateral of such Grantor.

“Credit Agreement” is defined in the recitals.

“Default” means the occurrence and continuance of any of the following events:
(i) any Event of Default or (ii) any warranty of any Grantor herein is untrue or
misleading in any material respect and, as a result thereof, the Domestic
Administrative Agent’s security interest in any material portion of the
Collateral (of all Grantors taken as a whole) is not perfected or the Domestic
Administrative Agent’s rights and remedies with respect to any material portion
of the Collateral of all Grantors (taken as a whole) is materially impaired or
otherwise materially adversely affected.

“Domestic Administrative Agent” is defined in the introductory paragraph.

“Domestic Borrower” is defined in the introductory paragraph.

“Grantor” is defined in the introductory paragraph.

“Guaranty” is defined in the recitals.

“Intellectual Property” means all past, present and future: trade secrets and
other proprietary information; trademarks, service marks, business  names,
designs, logos, indicia, and/or other source and/or business identifiers and the
goodwill of the business relating thereto and all registrations or applications
for registrations which have heretofore been or may hereafter be issued thereon
throughout the world; copyrights (including, without limitation, copyrights for
computer programs) and copyright registrations or applications for registrations
which have heretofore been or may hereafter be issued throughout the world and
all tangible property embodying the copyrights; unpatented inventions (whether
or not patentable); patent applications and patents; industrial designs,
industrial design applications and registered industrial designs, license
agreements related to any of the foregoing set forth in this definition and
income therefrom; books, records, writings, computer tapes or disks, flow
diagrams, specification sheets, source codes, object codes and other physical
manifestations, embodiments or incorporations of any of the foregoing set forth
in this definition; the right to sue for all past, present and future
infringements of any of the foregoing set forth in this definition; and all
common law and other rights throughout the world in and to all of the foregoing.

“Lender Party” means each Lender and any affiliate of such Lender which is party
to a Swap Contract with the Borrower.

“Lenders” is defined in the recitals.

“Liabilities” means (a) as to the Domestic Borrower, all obligations of the
Domestic Borrower to the Domestic Administrative Agent or any Lender Party,
howsoever created, arising or evidenced, whether direct or indirect, absolute or
contingent, now or hereafter existing, or due or to become due, which arise out
of or in connection with any of the Loan Documents (including, without
limitation, with respect to Letters of Credit), as the same may be amended,

F-3

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

modified, extended or renewed from time to time, and all obligations of the
Domestic Borrower to any Lender Party under any Swap Contract, (b) with respect
to each Grantor other than the Domestic Borrower, all obligations of such
Grantor under the Guaranty or any other Collateral Document, and (c) with
respect to each Grantor, all Costs and Expenses payable by such Grantor.

“Non-Tangible Collateral” means, with respect to any Grantor, collectively, such
Grantor’s Accounts  and General Intangibles.

“Permitted Liens” is defined in Section 3 hereof.

“UCC” means the Uniform Commercial Code as in effect in the State of California
on the date of this Agreement, as the same may be amended from time to time.

Section 16.  Grant of Security Interest.  As security for the payment of all
Liabilities, each Grantor hereby assigns to the Domestic Administrative Agent
for the benefit of the Lender Parties, and grants to the Domestic Administrative
Agent for the benefit of the Lender Parties a continuing security interest in,
the following, whether now or hereafter existing or acquired:

All of such Grantor’s:

(i)            Accounts;

(ii)           Chattel Paper;

(iii)          Commercial Tort Claims;

(iv)          Computer Hardware and Software and all rights with respect
thereto, including, without limitation, any and all licenses, options,
warranties, service contracts, program services, test rights, maintenance
rights, support rights, improvement rights, renewal rights and indemnifications,
and any substitutions, replacements, additions or model conversions of any of
the foregoing;

(v)           Deposit Accounts;

(vi)          Documents;

(vii)         General Intangibles;

(viii)        Goods (including, without limitation, all its Equipment, Fixtures
and Inventory), together with all accessions, additions, attachments,
improvements, substitutions and replacements thereto and therefor;

(ix)           Instruments;

(x)            Intellectual Property;

(xi)           Investment Property;

F-4

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

(xii)          Letter-of-Credit Rights and letters of credit (as such term is
defined in the UCC;

(xiii)         money (as such term is defined in the UCC) of every jurisdiction
whatsoever;

(xiv)        to the extent not included in the foregoing, other personal
property of any kind or description;

(xv)         to the extent not included in the foregoing, all books, records,
writings, data bases, information and other property relating to, used or useful
in connection with, evidencing, embodying, incorporating or referring to any of
the foregoing, all claims and/or insurance proceeds arising out of the loss,
nonconformity or any interference with the use of, or any defects or
infringements of rights in, or damage to, any of the foregoing; and

(xvi)        all proceeds, products, offspring, rents, issues, profits and
returns of and from, and all distributions on and rights arising out of, any of
the foregoing.

Notwithstanding anything herein to the contrary, in no event shall the
Collateral include, and no Grantor shall be deemed to have granted a security
interest in (i) any of such Grantor’s rights or interests in any license,
contract or agreement to which such Grantor is a party or any of its rights or
interests thereunder to the extent, but only to the extent, that such a grant
would, under the terms of such license, contract or agreement or otherwise,
result in a breach of the terms of, or constitute a default under any license,
contract or agreement to which such Grantor is a party (other than to the extent
that any such term would be rendered ineffective pursuant to the Uniform
Commercial Code, as it exists on the date of this Agreement or as it may
hereafter be amended, in the State of California (the “UCC”) or any other
applicable law (including the Bankruptcy Code) or principles of equity);
provided, that immediately upon the ineffectiveness, lapse or termination of any
such provision, the Collateral shall include, and such Grantor shall be deemed
to have granted a security interest in, all such rights and interests as if such
provision had never been in effect, or (ii) any real property leasehold.

Section 17.  Warranties.  Each Grantor warrants that:  (i) such Grantor shall
take no action to cause or permit any financing statement (other than any which
may have been filed on behalf of the Domestic Administrative Agent or in
connection with Permitted Liens (as defined below)) covering any of the
Collateral to be on file in any public office; (ii) such Grantor is and will be
the lawful owner of its interest in all Collateral, free of all Liens
whatsoever, other than the security interest hereunder and Liens expressly
permitted by the Credit Agreement (“Permitted Liens”), with full corporate power
and authority to execute this Agreement and perform such Grantor’s obligations
hereunder, and to subject the Collateral to the security interest hereunder;
(iii) such Grantor’s true legal name as registered in the jurisdiction in which
such Grantor is organized or incorporated, state of incorporation or
organization, organizational identification number as designed by the state of
its incorporation or organization, federal employee identification number, chief
executive office, and principal place of business are as set forth on Schedule I
hereto (as supplemented by the Grantor from time to time) (and such Grantor has
not maintained its chief executive office and principal place of business at any
other location

F-5

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

at any time after June 30, 2001), except to the extent that Grantor has given
the Domestic Administrative Agent notice of any change as contemplated by
Section 6 of this Agreement; (iv) each other location where such Grantor
maintains a place of business or locates Goods with a value in excess of
$250,000 is set forth on Schedule II hereto, as of the most recent date of
delivery of a supplement to such Schedule (as supplemented by the Grantor from
time to time but no less frequently than annually); (v) except as disclosed on
Schedule III, such Grantor is not known as of the date of this Agreement and
during the five years preceding the date hereof has not previously been known by
any trade name; (vi) except as disclosed on Schedule III, during the five years
preceding the date hereof such Grantor has not been known by any legal name
different from the one set forth on the signature page of this Agreement nor has
such Grantor been the subject of any merger or other corporate reorganization;
and (vii) Schedule IV, as of the most recent date of delivery of a supplement to
such Schedule (as supplemented by the Grantor from time to time but no less
frequently than annually) hereto contains a complete listing of all of such
Grantor’s Intellectual Property which has been registered under any United
States federal registration statute.

Section 18.  Collections, etc.  Until such time during the existence of a
Default as the Domestic Administrative Agent shall notify such Grantor of the
revocation of such power and authority, each Grantor (a) will, at its own
expense, endeavor to collect, consistent with past practice, all amounts due
under any of the Non-Tangible Collateral, including the taking of such action
with respect to such collection as such Grantor may deem advisable in the
exercise of its business judgment , and (b) may grant, in the ordinary course of
business, to any party obligated on any of the Non-Tangible Collateral, any
rebate, refund or allowance to which such party may be lawfully entitled, and
may accept, in connection therewith, the return of Goods, the sale or lease of
which shall have given rise to such Non-Tangible Collateral.  The Domestic
Administrative Agent, however, may, at any time that a Default exists, whether
before or after any revocation of such power and authority or the maturity of
any of the Liabilities, notify any parties obligated on any of the Non-Tangible
Collateral to make payment to the Domestic Administrative Agent of any amounts
due or to become due thereunder and enforce collection of any of the
Non-Tangible Collateral by suit or otherwise and surrender, release or exchange
all or any part thereof, or compromise or extend or renew for any period
(whether or not longer than the original period) any indebtedness thereunder or
evidenced thereby.  Upon request of the Domestic Administrative Agent during the
existence of a Default, each Grantor will, at its own expense, notify any
parties obligated on any of the Non-Tangible Collateral to make payment to the
Domestic Administrative Agent of any amounts due or to become due thereunder.

Upon request by the Domestic Administrative Agent during the existence of a
Default, (i) each Grantor will forthwith, upon receipt, transmit and deliver to
the Domestic Administrative Agent, in the form received, all cash, checks,
drafts and other instruments or writings for the payment of money (properly
endorsed, where required, so that such items may be collected by the Domestic
Administrative Agent) which may be received by such Grantor at any time in full
or partial payment or otherwise as proceeds of any of the Collateral, and
(ii) except as the Domestic Administrative Agent may otherwise consent in
writing, any such items which may be so received by any Grantor during the
existence of a Default will not be commingled with any other of its funds or
property, but will be held separate and apart from its own funds or property and
upon express trust for the Domestic Administrative Agent until delivery is made
to the

F-6

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

Domestic Administrative Agent.  Each Grantor will comply with the terms and
conditions of any consent given by the Domestic Administrative Agent pursuant to
the foregoing sentence.

During the existence of a Default, (i) all items or amounts which are delivered
by any Grantor to the Domestic Administrative Agent on account of partial or
full payment or otherwise as proceeds of any of the Collateral shall be
deposited to the credit of a deposit account (each an “Assignee Deposit
Account”) under which the Domestic Administrative Agent is the depositary bank
of such Grantor, as security for payment of the Liabilities, and (ii) no Grantor
shall have any right to withdraw any funds deposited in the applicable Assignee
Deposit Account.  The Domestic Administrative Agent may, from time to time, in
its discretion, and shall upon request of the applicable Grantor made not more
than once in any week, apply all or any of the then balance, representing
collected funds, in the Assignee Deposit Account, toward payment of the
Liabilities, whether or not then due, in such order of application as the
Domestic Administrative Agent may determine, and the Domestic Administrative
Agent may, from time to time, in its discretion, release all or any of such
balance to the applicable Grantor.

During the existence of a Default, the Domestic Administrative Agent is
authorized to endorse, in the name of the applicable Grantor, any item,
howsoever received by the Domestic Administrative Agent, representing any
payment on or other proceeds of any of the Collateral.

From and after the date that is 90 days after the date hereof, no Grantor shall
maintain any Deposit Account or deposit any items or amounts in any Deposit
Account, except: (i) Deposit Accounts maintained with Domestic Administrative
Agent, (ii) local Deposit Accounts maintained by each respective Grantor in
order to fund such Grantor’s ordinary course of business operations, (iii) other
Deposit Accounts of the Grantors for which account control agreements with the
Domestic Administrative Agent are in effect or that are swept into concentration
accounts for which account control agreements with the Domestic Administrative
Agent are in place, (iv) Deposit Accounts with an aggregate amount on deposit
not to exceed $1,000,000, and (v) as otherwise permitted by the Credit
Agreement.

Section 19.  Certificates, Schedules and Reports.  Each Grantor will from time
to time deliver to the Domestic Administrative Agent such schedules,
certificates and reports respecting all or any of the Collateral at the time
subject to the security interest hereunder, and the items or amounts received by
such Grantor in full or partial payment of any of the Collateral, as the
Domestic Administrative Agent may reasonably request.  Any such schedule,
certificate or report shall be executed by a duly authorized officer of such
Grantor and shall be in such form and detail as the Domestic Administrative
Agent may reasonably specify.  Each Grantor shall immediately notify the
Domestic Administrative Agent of the occurrence of any event causing any loss or
depreciation in the value of its Inventory or other Goods which is material to
the Domestic Borrower and its Subsidiaries taken as a whole, and such notice
shall specify the amount of such loss or depreciation.

Section 20.  Agreements of the Grantors.  Each Grantor (a) will, upon request of
the Domestic Administrative Agent, execute such financing statements and other
documents (and pay the cost of filing or recording the same in all public
offices reasonably deemed appropriate by the Domestic Administrative Agent) and
do such other acts and things (including, without limitation, delivery to the
Domestic Administrative Agent of any Instruments or Certificated

F-7

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

Securities which constitute Collateral), all as the Domestic Administrative
Agent may from time to time reasonably request, to establish and maintain a
valid perfected security interest in the Collateral (free of all other liens,
claims and rights of third parties whatsoever, other than Permitted Liens) to
secure the payment of the Liabilities; (b) hereby authorizes the Domestic
Administrative Agent to file financing statements describing the collateral as
“all property” or words of similar import, and to file other documents without
its signature (to the extent allowed by applicable law); (c) on and as of the
date of delivery of each supplement to Schedule II hereto, will have all its
Inventory, Equipment and all other Goods, in each case with a value in excess of
$250,000, at, and will not have any place of business or any such Goods at any
location other than its address(es) shown on Schedules I and II hereto as so
supplemented; (d) shall not change its state of organization or incorporation or
its name, identity or organizational structure such that any financing statement
filed to perfect the Domestic Administrative Agent interests under this
Agreement would become seriously misleading, unless the Grantor shall have given
the Domestic Administrative Agent not less than 10 days’ prior notice of such
change (provided that this Section 6(d) shall not be deemed authorize any change
or transaction prohibited under the Credit Agreement); (e) will furnish the
Domestic Administrative Agent such information concerning such Grantor, the
Collateral and the Account Debtors as the Domestic Administrative Agent may from
time to time reasonably request; (f) will, upon request of the Domestic
Administrative Agent, stamp on its records concerning the Collateral and add on
all Chattel Paper constituting a portion of the Collateral, a notation, in form
satisfactory to the Domestic Administrative Agent, of the security interest of
the Domestic Administrative Agent hereunder; (g) except as permitted by the
Credit Agreement, will not sell, lease, assign or create or permit to exist any
lien on or security interest in any Collateral other than Permitted Liens and
liens and security interests in favor of the Domestic Administrative Agent; (h)
will at all times keep all its Inventory and other Goods insured as required by
Section 6.07 of the Credit Agreement, and cause all such insurance policies for
loss or damage to provide that loss thereunder shall be payable to the Domestic
Administrative Agent as its interest may appear (it being understood that (A) so
long as no Default shall be existing, the Domestic Administrative Agent shall
deliver any proceeds of such insurance which may be received by it to such
Grantor and (B) whenever a Default shall be existing, the Domestic
Administrative Agent may apply any proceeds of such insurance which may be
received by it toward payment of the Liabilities, whether or not due, in such
order of application as the Domestic Administrative Agent may determine) and
such policies or certificates thereof shall, if the Domestic Administrative
Agent so requests, be deposited with or furnished to the Domestic Administrative
Agent; (i) will, upon request of the Domestic Administrative Agent, (1) cause to
be noted on the applicable certificate, in the event any material item of its
Equipment is covered by a certificate of title, the security interest of the
Domestic Administrative Agent in the Equipment covered thereby and (2) deliver
all such certificates to the Domestic Administrative Agent or its designees; (j)
will take all steps reasonably necessary to protect, preserve and maintain all
of its rights in all material portions of the Collateral; (k) except as
permitted by the Credit Agreement, will keep all of the tangible Collateral,
Deposit Accounts and Investment Property in the continental United States; and
(l) will reimburse the Domestic Administrative Agent for all expenses, including
reasonable attorneys’ fees and legal expenses, incurred by the Domestic
Administrative Agent in seeking to collect or enforce any rights in respect of
such Grantor’s Collateral.

Any expenses incurred in protecting, preserving and maintaining any Collateral
shall be borne by the applicable Grantor.  Whenever a Default shall be existing,
the Domestic

F-8

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

Administrative Agent shall have the right to bring suit to enforce any or all of
the Intellectual Property or licenses thereunder, in which event the applicable
Grantor shall at the request of the Domestic Administrative Agent do any and all
lawful acts and execute any and all proper documents required by the Domestic
Administrative Agent in aid of such enforcement and such Grantor shall promptly,
upon demand, reimburse and indemnify the Domestic Administrative Agent for all
reasonable costs and expenses incurred by the Domestic Administrative Agent in
the exercise of its rights under this Section 6, except to the extent any of the
foregoing result from the gross negligence or willful misconduct of the Domestic
Administrative Agent.  Notwithstanding the foregoing, except as set forth in
Section 8, the Domestic Administrative Agent shall have no obligations or
liabilities regarding the Collateral or any thereof by reason of, or arising out
of, this Agreement.

Section 21.  Default.  Whenever a Default shall be existing, the Domestic
Administrative Agent may exercise from time to time any and all rights and
remedies available to it under applicable law, in addition to those described in
this section below.

(a)           Each Grantor agrees, in case of Default, (i) to assemble, at its
expense, all its Inventory and other Goods (other than Fixtures) at a convenient
place or places acceptable to the Domestic Administrative Agent, and (ii) at the
Domestic Administrative Agent’s request, to execute all such documents and do
all such other things which may be necessary or desirable in order to enable the
Domestic Administrative Agent or its nominee to be registered as owner of the
Intellectual Property with any competent registration authority.

(b)           Notice of the intended disposition of  the Collateral  may be
given by first-class mail, hand-delivery (through a delivery service or
otherwise), facsimile or E-mail, and shall be deemed to have been “sent” upon
deposit in the U.S. Mails with adequate postage properly affixed, upon delivery
to an express delivery service or upon the electronic submission through
telephonic or Internet services, as applicable.  Each Grantor hereby agrees and
acknowledges that (i) with respect to collateral that is: (A) perishable or
threatens to decline speedily in value, or (B) is of a type customarily sold on
a recognized market (including but not limited to, Investment Property), no
notice of disposition need be given; and (ii) with respect to Collateral not
described in clause (i) above, notification sent after default and ten days
before any proposed disposition provides notice within a reasonable time before
disposition.

(c)           Each Grantor hereby agrees and acknowledges that a commercially
reasonable disposition of Inventory, Equipment, Computer Hardware and Software,
or Intellectual Property may be by lease or license of, in addition to the sale
of, such Collateral.  Each Grantor further agrees and acknowledges that and that
a disposition: (i) made in the usual manner on any recognized market, or (ii) a
disposition at the price current in any recognized market at the time of
disposition, or (iii) a disposition in conformity with reasonable commercial
practices among dealers in the type of property subject to the disposition;
shall be deemed commercially reasonable.

(d)           Any cash proceeds of any disposition by the Domestic
Administrative Agent of any of the Collateral  shall be applied by the Domestic
Administrative Agent to payment of expenses in connection with the Collateral,
including reasonable attorneys’ fees and legal expenses, and  thereafter to the
payment of any and all of the Liabilities in the order of

F-9

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

application set forth in Section 8.03 of the Credit Agreement, and thereafter
any surplus will be paid to the Grantor.  The Domestic Administrative Agent need
not apply or pay over for application noncash proceeds of collection and
enforcement unless: (i) the failure to do so would be commercially unreasonable
and (ii) the affected Grantor has provided the Domestic Administrative Agent
with a written demand to apply or pay over such noncash proceeds on such basis.

Section 22.  General.  The Domestic Administrative Agent shall be deemed to have
exercised reasonable care in the custody and preservation of any of the
Collateral in its possession if it treats such Collateral with the same care it
affords its own property or if it takes such action for that purpose as any
applicable Grantor requests in writing, but failure of the Domestic
Administrative Agent to comply with any such request shall not, of itself, be
deemed a failure to exercise reasonable care, and no failure of the Domestic
Administrative Agent to preserve or protect any rights with respect to such
Collateral against prior parties, or to do any act with respect to the
preservation of such Collateral not so requested by any Grantor, shall be deemed
a failure to exercise reasonable care in the custody or preservation of such
Collateral.

All notices and requests hereunder shall be in writing (including facsimile
transmission) and shall be sent (i) if to the Domestic Administrative Agent, to
its address shown on Schedule 10.02 to the Credit Agreement or such other
address as it may, by written notice to the Domestic Borrower, have designated
as its address for such purpose, and (ii) if to any Grantor, to its address
shown on Schedule I hereto or to such other address as such Grantor may, by
written notice to the Administrative Agent, have designated as its address for
such purpose.  Notices sent by facsimile transmission shall be deemed to have
been given when sent; notices sent by mail shall be deemed to have been given
five Business Days after the date when sent by registered or certified mail,
postage prepaid; and notices sent by hand delivery or overnight courier shall be
deemed to have been given when received.

No delay on the part of the Domestic Administrative Agent in the exercise of any
right or remedy shall operate as a waiver thereof, and no single or partial
exercise by the Domestic Administrative Agent of any right or remedy shall
preclude other or further exercise thereof or the exercise of any other right or
remedy.

This Agreement shall remain in full force and effect until all Liabilities have
been paid in full and all Commitments have terminated.  If at any time all or
any part of any payment theretofore applied by the Domestic Administrative Agent
or any Lender Party to any of the Liabilities is or must be rescinded or
returned by the Domestic Administrative Agent or such Lender Party for any
reason whatsoever (including, without limitation, the insolvency, bankruptcy or
reorganization of any Grantor), such Liabilities shall, for the purposes of this
Agreement, to the extent that such payment is or must be rescinded or returned,
be deemed to have continued in existence, notwithstanding such application by
the Domestic Administrative Agent or such Lender Party, and this Agreement shall
continue to be effective or be reinstated, as the case may be, as to such
Liabilities, all as though such application by the Domestic Administrative Agent
or such Lender Party had not been made.

Upon the payment in full of all Obligations, the cancellation or termination of
the Commitments and the cancellation or expiration of all outstanding Letters of
Credit, the security

F-10

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

interest granted hereby shall terminate and all rights to the Collateral shall
revert to the applicable Grantors.  Upon any such termination the Domestic
Administrative Agent will, at Grantor’s expense, execute and deliver to Grantors
such documents as Grantors shall reasonably request to evidence such
termination.  In addition, upon the proposed sale, transfer or other disposition
of any Collateral by Grantors in compliance with the Credit Agreement for which
such Grantor desires to obtain a security interest release from the Domestic
Administrative Agent, such Grantor shall deliver an Officer’s Certificate (x)
stating that the Collateral subject to such disposition is being sold,
transferred or otherwise disposed of in compliance with the terms of the Credit
Agreement and (y) specifying the Collateral being sold, transferred or otherwise
disposed of in the proposed transaction.  Upon the receipt of such Officer’s
Certificate, the Domestic Administrative Agent shall, at Grantor’s expense,
execute and deliver such releases of its security interest in such Collateral
which is to be so sold, transferred or disposed of, as may be reasonably
requested by such Grantor.

This Agreement and all other Loan Documents shall be deemed to be contracts made
in Los Angeles, California, and shall be governed by and construed in accordance
with and governed by the internal laws of the State of California (except to the
extent that pursuant to California law, the perfection, the effect of perfection
or nonperfection, or the priority of the security interest granted hereunder may
be determined in accordance with the laws of a different jurisdiction). 
Whenever possible, each provision of this Agreement shall be interpreted in such
manner as to be effective and valid under applicable law, but if any provision
of this Agreement shall be prohibited by or invalid under applicable law, such
provision shall be ineffective to the extent of such prohibition or invalidity,
without invalidating the remainder of such provision or the remaining provisions
of this Agreement.

The rights and privileges of the Domestic Administrative Agent hereunder shall
inure to the benefit of its successors.

This Agreement may be executed in any number of counterparts and by the
different parties hereto on separate counterparts, and each such counterpart
shall be deemed to be an original, but all such counterparts shall together
constitute one and the same Agreement.  At any time after the date of this
Agreement, one or more additional persons or entities may become parties hereto
by executing and delivering to the Domestic Administrative Agent a counterpart
of this Agreement (including supplements to the Schedules hereto).  Immediately
upon such execution and delivery (and without any further action), each such
additional person or entity will become a party to, and will be bound by all the
terms of, this Agreement.

ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT OR ANY OTHER LOAN
DOCUMENT MAY BE BROUGHT IN THE COURTS OF THE STATE OF CALIFORNIA SITTING IN LOS
ANGELES OR OF THE UNITED STATES FOR THE CENTRAL DISTRICT OF SUCH STATE, AND BY
EXECUTION AND DELIVERY OF THIS AGREEMENT, THE DOMESTIC BORROWER, EACH GRANTOR,
THE ADMINISTRATIVE AGENT AND EACH LENDER PARTY CONSENTS, FOR ITSELF AND IN
RESPECT OF ITS PROPERTY, TO THE NON-EXCLUSIVE JURISDICTION OF THOSE COURTS.  THE
DOMESTIC BORROWER, EACH GRANTOR, THE ADMINISTRATIVE AGENT AND EACH LENDER PARTY
IRREVOCABLY WAIVES ANY OBJECTION, INCLUDING ANY OBJECTION TO THE LAYING OF VENUE
OR

F-11

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

BASED ON THE GROUNDS OF FORUM NON CONVENIENS, WHICH IT MAY NOW OR HEREAFTER HAVE
TO THE BRINGING OF ANY ACTION OR PROCEEDING IN SUCH JURISDICTION IN RESPECT OF
ANY LOAN DOCUMENT OR OTHER DOCUMENT RELATED THERETO.  THE DOMESTIC BORROWER,
EACH GRANTOR, THE ADMINISTRATIVE AGENT AND EACH LENDER PARTY WAIVES PERSONAL
SERVICE OF ANY SUMMONS, COMPLAINT OR OTHER PROCESS, WHICH MAY BE MADE BY ANY
OTHER MEANS PERMITTED BY THE LAW OF SUCH STATE.

EACH PARTY TO THIS AGREEMENT HEREBY EXPRESSLY WAIVES ANY RIGHT TO TRIAL BY JURY
OF ANY CLAIM, DEMAND, ACTION OR CAUSE OF ACTION ARISING UNDER ANY LOAN DOCUMENT
OR IN ANY WAY CONNECTED WITH OR RELATED OR INCIDENTAL TO THE DEALINGS OF THE
PARTIES HERETO OR ANY OF THEM WITH RESPECT TO ANY LOAN DOCUMENT, OR THE
TRANSACTIONS RELATED THERETO, IN EACH CASE WHETHER NOW EXISTING OR HEREAFTER
ARISING, AND WHETHER FOUNDED IN CONTRACT OR TORT OR OTHERWISE; AND EACH PARTY
HEREBY AGREES AND CONSENTS THAT ANY SUCH CLAIM, DEMAND, ACTION OR CAUSE OF
ACTION SHALL BE DECIDED BY COURT TRIAL WITHOUT A JURY, AND THAT ANY PARTY TO
THIS AGREEMENT MAY FILE AN ORIGINAL COUNTERPART OR A COPY OF THIS SECTION WITH
ANY COURT AS WRITTEN EVIDENCE OF THE CONSENT OF THE SIGNATORIES HERETO TO THE
WAIVER OF THEIR RIGHT TO TRIAL BY JURY.

If any action or proceeding is filed in a court of the State of California by or
against any party hereto in connection with any of the transactions contemplated
by this Agreement or any other Loan Document, the court shall, and is hereby
directed to, make a general reference pursuant to California Code of Civil
Procedure Section 638 to a referee (who shall be a single active or retired
judge) to hear and determine all of the issues in such action or proceeding
(whether of fact or of law) and to report a statement of decision, provided that
at the option of any party to such proceeding, any such issues pertaining to a
“provisional remedy” as defined in California Code of Civil Procedure Section
1281.8 shall be heard and determined by the court.

F-12

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

IN WITNESS WHEREOF, this Agreement has been duly executed as of the day and year
first above written.

 

GUESS ?, INC.,

 

a Delaware corporation

 

 

 

 

 

By:

 

 

Name:

Carlos Alberini

 

Title:

President and Chief Operating Officer

 

F-13

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

 

GUESS? BERMUDA HOLDINGS, LLC,

 

a Delaware limited liability company

 

 

 

 

 

By:

 

 

Name:

Carlos Alberini

 

Title:

President and Chief Operating Officer

 

F-14

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

 

GUESS.COM, INC.,

 

a Delaware corporation

 

 

 

 

 

By:

 

 

Name:

Carlos Alberini

 

Title:

President and Chief Operating Officer

 

F-15

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

 

GUESS? RETAIL, INC.,

 

a Delaware corporation

 

 

 

 

 

By:

 

 

Name:

Carlos Alberini

 

Title:

President and Chief Operating Officer

 

F-16

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

 

GUESS? VALUE, LLC,

 

a Virginia limited liability corporation

 

 

 

 

 

By:

 

 

Name:

Carlos Alberini

 

Title:

President and Chief Operating Officer

 

F-17

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

 

BANK OF AMERICA, N.A.,

 

as Administrative Agent for the Lenders

 

 

 

 

 

By:

 

 

Name:

Matthew Koenig

 

Title:

Senior Vice President

 

F-18

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

SCHEDULE I
TO SECURITY AGREEMENT

Grantor’s federal employment identification number:

Grantor’s state identification number:

Grantor’s state of incorporation/organization:

Grantor’s true and correct name as registered in its
state of incorporation/organization:

Grantor’s chief executive office:

Grantor’s principal place of business:

F-19

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

SCHEDULE II
TO SECURITY AGREEMENT

ADDRESSES OF ALL LOCATIONS AT WHICH GOODS ARE KEPT

F-20

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

SCHEDULE III
TO SECURITY AGREEMENT

TRADE NAMES

F-21

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

SCHEDULE IV
TO SECURITY AGREEMENT

LIST OF INTELLECTUAL PROPERTY

F-22

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

EXHIBIT G

OPINION MATTERS

The matters contained in the following Sections of the Credit Agreement should
be covered by the legal opinion:

·                                          Section 5.01(a), (b) and (c)

·                                          Section 5.02

·                                          Section 5.03

·                                          Section 5.04

·                                          Section 5.06

·                                          Section 5.14(b)

G-1

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