FIRST LIEN CREDIT AGREEMENT,
dated as of September 5, 2006,
among
HANESBRANDS INC.,
as the Borrower,
VARIOUS FINANCIAL INSTITUTIONS AND
OTHER PERSONS FROM TIME TO TIME
PARTY HERETO,
as the Lenders,
HSBC BANK USA, NATIONAL ASSOCIATION,
LASALLE BANK NATIONAL ASSOCIATION, and
BARCLAYS BANK PLC,
as the Co-Documentation Agents,
MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED
and
MORGAN STANLEY SENIOR FUNDING, INC.,
as the Co-Syndication Agents,
CITICORP USA, INC.,
as the Administrative Agent,
and
CITIBANK, N.A., as the Collateral Agent.
 
MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED
and
MORGAN STANLEY SENIOR FUNDING, INC.,
as the Joint Lead Arrangers and Joint Bookrunners
*Portions of this document have been omitted pursuant to a Confidential
Treatment Request.

 

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TABLE OF CONTENTS

         
ARTICLE I DEFINITIONS AND ACCOUNTING TERMS
    2  
Section 1.1 Defined Terms
    2  
Section 1.2 Use of Defined Terms
    37  
Section 1.3 Cross-References
    37  
Section 1.4 Accounting and Financial Determinations
    37  
Section 1.5 Exchange Rates; Currency Equivalents
    38  
Section 1.6 Computation of Dollar Amounts
    38  
 
       
ARTICLE II COMMITMENTS, BORROWING AND ISSUANCE PROCEDURES, NOTES AND LETTERS OF
CREDIT
    38  
Section 2.1 Commitments
    38  
Section 2.2 Reduction of the Commitment Amounts
    40  
Section 2.3 Borrowing Procedures
    40  
Section 2.4 Continuation and Conversion Elections
    42  
Section 2.5 Funding
    43  
Section 2.6 Issuance Procedures
    43  
Section 2.7 Register; Notes
    47  
Section 2.8 Euro Loans
    47  
 
       
ARTICLE III REPAYMENTS, PREPAYMENTS, INTEREST AND FEES
    48  
Section 3.1 Repayments and Prepayments; Application
    48  
Section 3.2 Interest Provisions
    52  
Section 3.3 Fees
    53  
 
       
ARTICLE IV CERTAIN LIBO RATE AND OTHER PROVISIONS
    54  
Section 4.1 LIBO Rate Lending Unlawful
    54  
Section 4.2 Deposits Unavailable
    54  
Section 4.3 Increased LIBO Rate Loan Costs, etc
    54  
Section 4.4 Funding Losses
    55  
Section 4.5 Increased Capital Costs
    55  
Section 4.6 Taxes
    56  
Section 4.7 Payments, Computations; Proceeds of Collateral, etc
    58  
Section 4.8 Sharing of Payments
    59  
Section 4.9 Setoff
    60  
Section 4.10 Mitigation
    60  

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Section 4.11 Removal of Lenders
    60  
Section 4.12 Limitation on Additional Amounts, etc
    61  
 
       
ARTICLE V CONDITIONS TO CREDIT EXTENSIONS
    62  
Section 5.1 Initial Credit Extension
    62  
Section 5.2 All Credit Extensions
    66  
 
       
ARTICLE VI REPRESENTATIONS AND WARRANTIES
    66  
Section 6.1 Organization, etc
    66  
Section 6.2 Due Authorization, Non-Contravention, etc
    67  
Section 6.3 Government Approval, Regulation, etc
    67  
Section 6.4 Validity, etc
    67  
Section 6.5 Financial Information
    67  
Section 6.6 No Material Adverse Change
    68  
Section 6.7 Litigation, Labor Controversies, etc
    68  
Section 6.8 Subsidiaries
    68  
Section 6.9 Ownership of Properties
    68  
Section 6.10 Taxes
    68  
Section 6.11 Pension and Welfare Plans
    69  
Section 6.12 Environmental Warranties
    69  
Section 6.13 Accuracy of Information
    70  
Section 6.14 Regulations U and X
    70  
Section 6.15 Compliance with Contracts, Laws, etc
    71  
Section 6.16 Solvency
    71  
 
       
ARTICLE VII COVENANTS
    71  
Section 7.1 Affirmative Covenants
    71  
Section 7.2 Negative Covenants
    78  
 
       
ARTICLE VIII EVENTS OF DEFAULT
    92  
Section 8.1 Listing of Events of Default
    92  
Section 8.2 Action if Bankruptcy
    95  
Section 8.3 Action if Other Event of Default
    95  
 
       
ARTICLE IX THE ADMINISTRATIVE AGENT, THE COLLATERAL AGENT; THE LEAD ARRANGERS,
THE SYNDICATION AGENT AND THE DOCUMENTATION AGENT
    95  
Section 9.1 Actions
    95  

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Section 9.2 Funding Reliance, etc
    96  
Section 9.3 Exculpation
    96  
Section 9.4 Successor
    96  
Section 9.5 Loans by Citibank
    97  
Section 9.6 Credit Decisions
    97  
Section 9.7 Copies, etc
    97  
Section 9.8 Reliance by Agents
    97  
Section 9.9 Defaults
    98  
Section 9.10 Lead Arrangers, Syndication Agents and Documentation Agents
    98  
Section 9.11 Posting of Approved Electronic Communications
    98  
 
       
ARTICLE X MISCELLANEOUS PROVISIONS
    100  
Section 10.1 Waivers, Amendments, etc
    100  
Section 10.2 Notices; Time
    101  
Section 10.3 Payment of Costs and Expenses
    102  
Section 10.4 Indemnification
    103  
Section 10.5 Survival
    104  
Section 10.6 Severability
    104  
Section 10.7 Headings
    104  
Section 10.8 Execution in Counterparts, Effectiveness, etc
    104  
Section 10.9 Governing Law; Entire Agreement
    105  
Section 10.10 Successors and Assigns
    105  
Section 10.11 Sale and Transfer of Credit Extensions; Participations in Credit
Extensions; Notes
    105  
Section 10.12 Other Transactions
    107  
Section 10.13 Forum Selection and Consent to Jurisdiction
    108  
Section 10.14 Waiver of Jury Trial
    108  
Section 10.15 Patriot Act
    108  
Section 10.16 Judgment Currency
    109  
Section 10.17 Counsel Representation
    109  
Section 10.18 Confidentiality
    109  

         
SCHEDULE I
  —   Disclosure Schedule
SCHEDULE II
  —   Percentages; LIBOR Office; Domestic Office
SCHEDULE III
  —   Existing Letters of Credit

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EXHIBIT A-1
  —   Form of Revolving Note
EXHIBIT A-2
  —   Form of Term A Note
EXHIBIT A-3
  —   Form of Term B Note
EXHIBIT A-4
  —   Form of Swing Line Note
EXHIBIT B-1
  —   Form of Borrowing Request
EXHIBIT B-2
  —   Form of Issuance Request
EXHIBIT C
  —   Form of Continuation/Conversion Notice
EXHIBIT D
  —   Form of Lender Assignment Agreement
EXHIBIT E
  —   Form of Compliance Certificate
EXHIBIT F
  —   Form of Guaranty
EXHIBIT G
  —   Form of Pledge and Security Agreement
EXHIBIT H
  —   Form of Intercreditor Agreement
EXHIBIT I
  —   Form of Closing Date Certificate

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FIRST LIEN CREDIT AGREEMENT
     THIS FIRST LIEN CREDIT AGREEMENT, dated as of September 5, 2006, is among
HANESBRANDS INC., a Maryland corporation (the “Borrower”), the various financial
institutions and other Persons from time to time party hereto (the “Lenders”),
HSBC BANK USA, NATIONAL ASSOCIATION, LASALLE BANK NATIONAL ASSOCIATION and
BARCLAYS BANK PLC, as the co-documentation agents (in such capacities, the
“Documentation Agents”), MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED and
MORGAN STANLEY SENIOR FUNDING, INC., as the co-syndication agents (in such
capacities, the “Syndication Agents”), CITICORP USA, INC., as the administrative
agent (in such capacity, the “Administrative Agent”), CITIBANK, N.A., as the
collateral agent (in such capacity, the “Collateral Agent”), and MERRILL LYNCH,
PIERCE, FENNER & SMITH INCORPORATED and MORGAN STANLEY SENIOR FUNDING, INC., as
the joint lead arrangers and joint bookrunners (in such capacities, the “Lead
Arrangers”).
W I T N E S S E T H:
     WHEREAS, Sara Lee Corporation, a Maryland corporation (“Sara Lee”) intends,
among other things, to (i) transfer all the assets and certain associated
liabilities it attributes to its branded apparel Americas/Asia business (the
“Contributed Business”) to the Borrower, (ii) sell certain trademarks and other
intellectual property related to the Contributed Business (the “IP Purchase”,
with such trademarks and other intellectual property being herein collectively
referred to as the “HBI IP”) to HBI Branded Apparel Limited, Inc., a Delaware
corporation and a wholly-owned Subsidiary of the Borrower (the “IP Subsidiary”),
and (iii) distribute 100% of the Borrower’s common stock to Sara Lee’s
stockholders (the transfer of the Contributed Business and such distribution
being herein called the “Spin-Off”), pursuant to which, among other things,
(A) Sara Lee’s common stockholders will receive, on a pro rata basis, a dividend
of all of the issued and outstanding shares of common stock of the Borrower and
(B) concurrently with the consummation of the Spin-Off and the IP Purchase, Sara
Lee will receive a cash dividend from the Borrower in the approximate amount of
$2,400,000,000 (the “Dividend”);
     WHEREAS, for purposes of consummating the Spin-Off, the Dividend and the IP
Purchase, the Borrower and the IP Subsidiary intend to utilize the proceeds from
(i) the Loans, (ii) senior secured second lien loans in an aggregate amount of
$450,000,000 (the “Second Lien Loans”) and (iii)(A) senior unsecured notes
issued by the Borrower (the “Senior Notes”) and/or (B) unsecured increasing rate
loans (the “Bridge Loans”) collectively resulting in aggregate gross proceeds of
$500,000,000; and
     WHEREAS, the Lenders and the Issuers are willing, on the terms and subject
to the conditions hereinafter set forth, to extend the Commitments, make Loans
and issue (or participate in) Letters of Credit;
     NOW, THEREFORE, the parties hereto agree as follows.
First Lien Credit Agreement

 

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ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
     SECTION 1.1 Defined Terms. The following terms (whether or not underscored)
when used in this Agreement, including its preamble and recitals, shall, except
where the context otherwise requires, have the following meanings (such meanings
to be equally applicable to the singular and plural forms thereof):
     “Acquired Permitted Capital Expenditure Amount” is defined in clause (a) of
Section 7.2.7.
     “Administrative Agent” is defined in the preamble and includes each other
Person appointed as the successor Administrative Agent pursuant to Section 9.4.
     “Affected Lender” is defined in Section 4.11.
     “Affiliate” of any Person means any other Person which, directly or
indirectly, controls, is controlled by or is under common control with such
Person. “Control” of a Person means the power, directly or indirectly, (i) to
vote 10% or more of the Capital Securities (on a fully diluted basis) of such
Person having ordinary voting power for the election of directors, managing
members or general partners (as applicable), or (ii) to direct or cause the
direction of the management and policies of such Person (whether by contract or
otherwise).
     “Agents” means, as the context may require, the Administrative Agent and
the Collateral Agent, collectively, or either of them individually.
     “Agreement” means, on any date, this First Lien Credit Agreement as
originally in effect on the Closing Date and as thereafter from time to time
amended, supplemented, amended and restated or otherwise modified from time to
time and in effect on such date.
     “Alternate Base Rate” means, on any date and with respect to all Base Rate
Loans, a fluctuating rate of interest per annum (rounded upward, if necessary,
to the next highest 1/16 of 1%) equal to the higher of (i) the Base Rate in
effect on such day, and (ii) the Federal Funds Rate in effect on such day plus
1/2 of 1%. Changes in the rate of interest on that portion of any Loans
maintained as Base Rate Loans will take effect simultaneously with each change
in the Alternate Base Rate. The Administrative Agent will give notice promptly
to the Borrower and the Lenders of changes in the Alternate Base Rate; provided
that, the failure to give such notice shall not affect the Alternate Base Rate
in effect after such change.
     “Applicable Commitment Fee Margin” means the applicable percentage set
forth below corresponding to the relevant Leverage Ratio:
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          Applicable Commitment Leverage Ratio   Fee Margin Greater than or
equal to 3.75:1.00   0.500%       Less than 3.75:1.00 but greater than or equal
to 3.00:1.00   0.375%       Less than 3.00:1.00   0.250%

Notwithstanding anything to the contrary set forth in this Agreement (including
the then effective Leverage Ratio), the Applicable Commitment Fee Margin from
the Closing Date through (and including) the date of delivery of the financial
statements for the second full Fiscal Quarter ending after the Closing Date
shall be 0.50%. The Leverage Ratio used to compute the Applicable Commitment Fee
Margin shall be that set forth in the Compliance Certificate most recently
delivered by the Borrower to the Administrative Agent. Changes in the Applicable
Commitment Fee Margin resulting from a change in the Leverage Ratio shall become
effective upon delivery by the Borrower to the Administrative Agent of a new
Compliance Certificate pursuant to clause (c) of Section 7.1.1. If the Borrower
fails to deliver a Compliance Certificate on or before the date required
pursuant to clause (c) of Section 7.1.1, the Applicable Commitment Fee Margin
from and including the day after such required date of delivery to but not
including the date the Borrower delivers to the Administrative Agent a
Compliance Certificate shall equal the highest Applicable Commitment Fee Margin
set forth above.
     “Applicable Margin” means (i) in the case of Term B Loans maintained as
(A) LIBO Rate Loans, a percentage per annum equal to 2.25% and (B) Base Rate
Loans, a percentage per annum equal to 1.25%, and (ii) in the case of Term A
Loans and Revolving Loans, the applicable percentage set forth below
corresponding to the relevant Leverage Ratio:

              Applicable Margin     LIBO Rate   Base Rate Leverage Ratio   Loans
  Loans Greater than or equal to 4.00:1.00   1.75%   0.75%           Less than
4.00:1.00 but greater than or equal to 3.25:1.00   1.50%   0.50%           Less
than 3.25:1.00 but greater than or equal to 2.50:1.00   1.25%   0.25%          
Less than 2.50:1.00   1.00%   0.00%

Notwithstanding anything to the contrary set forth in this Agreement (including
the then effective Leverage Ratio), the Applicable Margin for all Term A Loans
and Revolving Loans from the Closing Date through (and including) the date of
delivery of the financial statements for the second full Fiscal Quarter ending
after Closing Date shall be (A) 1.75%, in the case of LIBO Rate Loans, and
(B) 0.75%, in the case of Base Rate Loans. The Leverage Ratio used to
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compute the Applicable Margin shall be the Leverage Ratio set forth in the
Compliance Certificate most recently delivered by the Borrower to the
Administrative Agent. Changes in the Applicable Margin resulting from a change
in the Leverage Ratio shall become effective upon delivery by the Borrower to
the Administrative Agent of a new Compliance Certificate pursuant to clause (c)
of Section 7.1.1. If the Borrower fails to deliver a Compliance Certificate on
or before the date required pursuant to clause (c) of Section 7.1.1, the
Applicable Margin from and including the day after such required date of
delivery to but not including the date the Borrower delivers to the
Administrative Agent a Compliance Certificate shall equal the highest Applicable
Margin set forth above.
     “Applicable Percentage” means, at any time of determination, (i) with
respect to a mandatory prepayment in respect of Net Equity Proceeds pursuant to
clause (e) of Section 3.1.1, (A) 50.0%, if the Leverage Ratio set forth in the
Compliance Certificate most recently delivered by the Borrower to the
Administrative Agent was greater than or equal to 3.75:1, (B) 25.0%, if the
Leverage Ratio set forth in such Compliance Certificate was less than 3.75:1 but
greater than or equal to 3.00:1, and (C) 0%, if the Leverage Ratio set forth in
such Compliance Certificate was less than 3.00:1, and (ii) with respect to a
mandatory prepayment in respect of Excess Cash Flow pursuant to clause (g) of
Section 3.1.1, (A) 50.0%, if the Leverage Ratio set forth in the Compliance
Certificate most recently delivered by the Borrower to the Administrative Agent
was greater than or equal to 3.75:1, (B) 25.0%, if the Leverage Ratio set forth
in such Compliance Certificate was less than 3.75:1 but greater than or equal to
3.00:1, and (C) 0%, if the Leverage Ratio set forth in such Compliance
Certificate was less than 3.00:1.
     “Approved Foreign Bank” is defined in the definition of “Cash Equivalent
Investment”.
     “Approved Fund” means any Person (other than a natural Person) that (i) is
engaged in making, purchasing, holding or otherwise investing in commercial
loans and similar extensions of credit in the ordinary course, and (ii) is
administered or managed by a Lender, an Affiliate of a Lender or a Person or an
Affiliate of a Person that administers or manages a Lender.
     “Authorized Officer” means, relative to any Obligor, the chief executive
officer, president, chief financial officer, treasurer, assistant treasurer,
secretary, assistant secretary and those of its other officers, general partners
or managing members (as applicable), in each case whose signatures and
incumbency shall have been certified to the Agents, the Lenders and the Issuers
pursuant to Section 5.1.1.
     “Available” means, in respect of Euros and any Lender at any time of
determination, that Euros are, at such time, readily available to such Lender as
deposits in the London or other applicable interbank market in the relevant
amount and for the relevant term, is freely convertible into Dollars and is
freely transferable for the purposes of this Agreement, but if, notwithstanding
that each of the foregoing tests is satisfied:
     (a) Euros are, under the then current legislation or regulations of the
applicable country (or under the policy of the central bank of such country) or
the F.R.S. Board, not permitted to be used for the purposes of this Agreement;
or
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     (b) there are regulatory or legal reasons which make it illegal or
impermissible for a Lender to make a LIBO Rate denominated in Euros available as
determined by such Lender in its sole discretion;
then Euros may be treated by any Lender as not being Available.
     “Base Rate” means, at any time, the rate published in the Wall Street
Journal as the “prime rate”(or equivalent) at such time.
     “Base Rate Loan” means a Loan denominated in Dollars bearing interest at a
fluctuating rate determined by reference to the Alternate Base Rate.
     “Borrower” is defined in the preamble.
     “Borrowing” means the Loans of the same type and, in the case of LIBO Rate
Loans, having the same Interest Period made by all Lenders required to make such
Loans on the same Business Day and pursuant to the same Borrowing Request in
accordance with Section 2.3.
     “Borrowing Request” means a Loan request and certificate duly executed by
an Authorized Officer of the Borrower substantially in the form of Exhibit B-1
hereto.
     “Branded Apparel Business” means, collectively, the HBI IP and the
Contributed Business.
     “Bridge Loan Administrative Agent” means the “Administrative Agent”
pursuant to, and as defined in, the Bridge Loan Documents, and any successor
thereto.
     “Bridge Loan Credit Agreement” means the Bridge Loan Credit Agreement,
dated as of the Closing Date, among the Borrower, the lenders from time to time
party thereto and the Bridge Loan Administrative Agent, as the same may be
amended, supplemented, amended and restated or otherwise modified from time to
time in accordance with this Agreement.
     “Bridge Loan Documents” means the Bridge Loan Credit Agreement and the
related guarantees, notes and other agreements and instruments entered into in
connection with the Bridge Loan Credit Agreement, in each case as the same may
be amended, supplemented, amended and restated or otherwise modified from time
to time in accordance with this Agreement.
     “Bridge Loans” is defined in the second recital.
     “Business Day” means (i) any day which is neither a Saturday or Sunday nor
a legal holiday on which banks are authorized or required to be closed in New
York, New York, (ii) relative to the making, continuing, prepaying or repaying
of any LIBO Rate Loans, any day which is a Business Day described in clause (i)
above and (A) on which dealings in the relevant Currency are carried on in the
London interbank eurodollar market and (B) in the case of LIBO Rate Loans
denominated in Euros, on which banks in the applicable country are not
authorized or required to be closed and (iii) for purposes of Section 2.1.2 any
day which is neither a Saturday or Sunday nor a legal holiday where the relevant
Issuer is located (and, if such Issuer is
First Lien Credit Agreement

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located in Hong Kong, excluding any day upon which a Typhoon Number 8 signal or
black rainstorm warning is hoisted before 12:00 noon (Hong Kong time)).
     “CapEx Pull Forward Amount” is defined in clause (b) of Section 7.2.7.
     “Capital Expenditures” means, for any period, the aggregate amount of
(i) all expenditures of the Borrower and its Subsidiaries for fixed or capital
assets made during such period which, in accordance with GAAP, would be
classified as capital expenditures and (ii) Capitalized Lease Liabilities
incurred by the Borrower and its Subsidiaries during such period; provided that
Capital Expenditures shall not include any such expenditures which constitute
any of the following, without duplication: (a) a Permitted Acquisition, (b) to
the extent permitted by this Agreement, capital expenditures consisting of Net
Disposition Proceeds or Net Casualty Proceeds not otherwise required to be used
to repay the Loans, (c) capital expenditures made utilizing Excluded Equity
Proceeds, (d) imputed interest capitalized during such period incurred in
connection with Capitalized Lease Liabilities not paid or payable in cash and
(e) any capital expenditure made in connection with the Transaction as a result
of the Borrower or any Subsidiary buying assets from Sara Lee. For the avoidance
of doubt (x) to the extent that any item is classified under clause (i) of this
definition and later classified under clause (ii) of this definition or could be
classified under either clause, it will only be required to be counted once for
purposes hereunder and (y) in the event the Borrower or any Subsidiary owns an
asset that was not used and is now being reused, no portion of the unused asset
shall be considered Capital Expenditures hereunder; provided that any
expenditure necessary in order to permit such asset to be reused shall be
included as a Capital Expenditure during the period that such expenditure
actually is made.
     “Capital Securities” means, with respect to any Person, all shares,
interests, participations or other equivalents (however designated, whether
voting or non-voting) of such Person’s capital, whether now outstanding or
issued after the Closing Date.
     “Capitalized Lease Liabilities” means, with respect to any Person, all
monetary obligations of such Person and its Subsidiaries under any leasing or
similar arrangement which, in accordance with GAAP, should be classified as
capitalized leases, and for purposes of each Loan Document the amount of such
obligations shall be the capitalized amount thereof, determined in accordance
with GAAP, and the stated maturity thereof shall be the date of the last payment
of rent or any other amount due under such lease prior to the first date upon
which such lease may be terminated by the lessee without payment of a premium or
a penalty.
     “Cash Collateralize” means, with respect to a Letter of Credit, the deposit
of immediately available funds into a cash collateral account maintained with
(or on behalf of) the Administrative Agent on terms reasonably satisfactory to
the Administrative Agent in an amount equal to the Stated Amount of such Letter
of Credit.
     “Cash Equivalent Investment” means, at any time:
     (a) any direct obligation of (or unconditionally guaranteed by) the United
States or a State thereof (or any agency or political subdivision thereof, to
the extent such
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obligations are supported by the full faith and credit of the United States or a
State thereof) maturing not more than one year after such time;
     (b) commercial paper maturing not more than 270 days from the date of
issue, which is issued by (i) a corporation (other than an Affiliate of any
Obligor) organized under the laws of any State of the United States or of the
District of Columbia and rated A-1 or higher by S&P or P-1 or higher by Moody’s,
or (ii) any Lender (or its holding company);
     (c) any certificate of deposit, time deposit or bankers acceptance,
maturing not more than one year after its date of issuance, which is issued by
either (i) any bank organized under the laws of the United States (or any State
thereof) and which has (A) a credit rating of A2 or higher from Moody’s or A or
higher from S&P and (B) a combined capital and surplus greater than
$500,000,000, or (ii) any Lender;
     (d) any repurchase agreement having a term of 30 days or less entered into
with any Lender or any commercial banking institution satisfying the criteria
set forth in clause (c)(i) which (i) is secured by a fully perfected security
interest in any obligation of the type described in clause (a), and (ii) has a
market value at the time such repurchase agreement is entered into of not less
than 100% of the repurchase obligation of such commercial banking institution
thereunder;
     (e) with respect to any Foreign Subsidiary, non-Dollar denominated
(i) certificates of deposit of, bankers acceptances of, or time deposits with,
any commercial bank which is organized and existing under the laws of the
country in which such Person maintains its chief executive office or principal
place of business or is organized provided such country is a member of the
Organization for Economic Cooperation and Development, and which has a
short-term commercial paper rating from S&P of at least “A-1” or the equivalent
thereof or from Moody’s of at least “P-1” or the equivalent thereof (any such
bank being an “Approved Foreign Bank”) and maturing within one year of the date
of acquisition and (ii) equivalents of demand deposit accounts which are
maintained with an Approved Foreign Bank; or
     (f) readily marketable obligations issued or directly and fully guaranteed
or insured by the government or any agency or instrumentality of any member
nation of the European Union whose legal tender is the Euro and which are
denominated in Euros or any other foreign currency comparable in credit quality
and tenor to those referred to above and customarily used by corporations for
cash management purposes in any jurisdiction outside the United States to the
extent reasonably required in connection with any business conducted by any
Foreign Subsidiary organized in such jurisdiction, having (i) one of the three
highest ratings from either Moody’s or S&P and (ii) maturities of not more than
one year from the date of acquisition thereof; provided that the full faith and
credit of any such member nation of the European Union is pledged in support
thereof.
     “Cash Management Obligations” means, with respect to the Borrower or any of
its Subsidiaries, any direct or indirect liability, contingent or otherwise, of
such Person in respect of cash management services (including treasury,
depository, overdraft (daylight and temporary),
First Lien Credit Agreement

7

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credit or debit card, electronic funds transfer and other cash management
arrangements) provided after the Closing Date by a Person who is (or was at the
time such Cash Management Obligations were incurred) the Administrative Agent,
any Lender or any Affiliate thereof, including obligations for the payment of
fees, interest, charges, expenses, attorneys’ fees and disbursements in
connection therewith to the extent provided for in the documents evidencing such
cash management services.
     “Cash Restructuring Charges” is defined in the definition of “EBITDA.”
     “Cash Spin-Off Charges” is defined in the definition of “EBITDA.”
     “Casualty Event” means the damage, destruction or condemnation, as the case
may be, of property of any Person or any of its Subsidiaries.
     “CERCLA” means the Comprehensive Environmental Response, Compensation and
Liability Act of 1980, as amended.
     “CERCLIS” means the Comprehensive Environmental Response Compensation
Liability Information System List.
     “Change in Control” means
     (a) any person or group (within the meaning of Sections 13(d) and 14(d)
under the Exchange Act) shall become the ultimate “beneficial owner” (as defined
in Rules 13d-3 and 13d-5 under the Exchange Act), directly or indirectly, of
Capital Securities representing more than 35% of the Capital Securities of the
Borrower on a fully diluted basis;
     (b) during any period of 24 consecutive months, individuals who at the
beginning of such period constituted the Board of Directors of the Borrower
(together with any new directors whose election to such Board or whose
nomination for election by the stockholders of the Borrower was approved by a
vote of a majority of the directors then still in office who were either
directors at the beginning of such period or whose election or nomination for
election was previously so approved) cease for any reason to constitute a
majority of the Board of Directors of the Borrower then in office; or
     (c) the occurrence of any “Change of Control” (or similar term) under (and
as defined in) any Second Lien Loan Document, Bridge Loan Document or Senior
Note Document.
     “Citibank” means, as the context may require, Citicorp USA and CitiNA,
collectively, or either of them, individually.
     “Citicorp USA” means Citicorp USA, Inc., in its individual capacity, and
any successor thereto by merger, consolidation or otherwise.
     “CitiNA” means Citibank, N.A., in its individual capacity, and any
successor thereto by merger, consolidation or otherwise.
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     “Closing Date Certificate” means the closing date certificate executed and
delivered by an Authorized Officer of the Borrower substantially in the form of
Exhibit I hereto.
     “Closing Date” means the date of the initial Credit Extension hereunder.
     “Code” means the Internal Revenue Code of 1986, and the regulations
thereunder, in each case as amended, reformed or otherwise modified from time to
time.
     “Collateral Agent” is defined in the preamble and includes each other
Person appointed as successor Collateral Agent pursuant to Section 9.4.
     “Commercial Letter of Credit” means any Letter of Credit issued for the
purpose of providing the primary payment mechanism in connection with the
purchase of any materials, goods or services by the Borrower or any Subsidiary
in the ordinary course of business of the Borrower or such Subsidiary.
     “Commitment” means, as the context may require, the Term A Loan Commitment,
the Term B Loan Commitment, the Revolving Loan Commitment, the Euro Loan
Commitment, the Letter of Credit Commitment or the Swing Line Loan Commitment.
     “Commitment Amount” means, as the context may require, the Term A Loan
Commitment Amount, the Term B Loan Commitment Amount, the Revolving Loan
Commitment Amount, the Euro Loan Commitment Amount, the Letter of Credit
Commitment Amount or the Swing Line Loan Commitment Amount.
     “Commitment Termination Date” means, as the context may require, the Term A
Loan Commitment Termination Date, the Term B Loan Commitment Termination Date or
the Revolving Loan Commitment Termination Date.
     “Commitment Termination Event” means
     (a) the occurrence of any Event of Default with respect to the Borrower
described in clauses (a) through (d) of Section 8.1.9; or
     (b) the occurrence and continuance of any other Event of Default and either
(i) the declaration of all or any portion of the Loans to be due and payable
pursuant to Section 8.3, or (ii) the giving of notice by the Administrative
Agent, acting at the direction of the Required Lenders, to the Borrower that the
Commitments have been terminated.
     “Communications” is defined in clause (a) of Section 9.11.
     “Compliance Certificate” means a certificate duly completed and executed by
an Authorized Officer of the Borrower, substantially in the form of Exhibit E
hereto.
     “Contingent Liability” means any agreement, undertaking or arrangement by
which any Person guarantees, endorses or otherwise becomes or is contingently
liable upon (by direct or indirect agreement, contingent or otherwise, to
provide funds for payment, to supply funds to, or
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otherwise to invest in, a debtor, or otherwise to assure a creditor against
loss) the Indebtedness of any other Person (other than by endorsements of
instruments in the course of collection), or guarantees the payment of dividends
or other distributions upon the Capital Securities of any other Person. The
amount of any Person’s obligation under any Contingent Liability shall (subject
to any limitation with respect thereto) be deemed to be the outstanding
principal amount of the debt, obligation or other liability guaranteed thereby.
     “Continuation/Conversion Notice” means a notice of continuation or
conversion and certificate duly executed by an Authorized Officer of the
Borrower, substantially in the form of Exhibit C hereto.
     “Contributed Business” is defined in the first recital.
     “Controlled Group” means all members of a controlled group of corporations
and all members of a controlled group of trades or businesses (whether or not
incorporated) under common control which, together with the Borrower, are
treated as a single employer under Section 414(b) or 414(c) of the Code or
Section 4001 of ERISA.
     “Copyright Security Agreement” means any Copyright Security Agreement
executed and delivered by any Obligor in substantially the form of Exhibit C to
the Security Agreement, as amended, supplemented, amended and restated or
otherwise modified from time to time.
     “Credit Extension” means, as the context may require,
     (a) the making of a Loan by a Lender; or
     (b) the issuance of any Letter of Credit, any amendment to or modification
of any Letter of Credit that increases the face amount thereof, or the extension
of any Stated Expiry Date of any existing Letter of Credit, by an Issuer.
     “Currency” and “Currencies” means Dollars and Euros.
     “Default” means any Event of Default or any condition, occurrence or event
which, after notice or lapse of time or both, would constitute an Event of
Default.
     “Defaulting Lender” means any Lender that (i) refuses (which refusal has
not been retracted prior to an Eligible Assignee agreeing to replace such Lender
as a “Lender” hereunder) or has failed to make available its portion of any
Borrowing or to fund its portion of any unreimbursed obligation under
Section 2.6.1 or (ii) has notified in writing the Borrower or the Administrative
Agent that such Lender does not intend to comply with its obligations under
Section 2.1.
     “Disbursement” is defined in Section 2.6.2.
     “Disbursement Date” is defined in Section 2.6.2.
     “Disclosure Schedule” means the Disclosure Schedule attached hereto as
Schedule I, as it may be amended, supplemented, amended and restated or
otherwise modified from time to time
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by the Borrower with the written consent of, in the case of non-material
modification, the Administrative Agent and, in the case of material
modifications the Required Lenders.
     “Disposition” (or similar words such as “Dispose”) means any sale,
transfer, lease (as lessor), contribution or other conveyance (including by way
of merger) of, or the granting of options, warrants or other rights to, any of
the Borrower’s or its Subsidiaries’ assets (including accounts receivable and
Capital Securities of Subsidiaries) to any other Person in a single transaction
or series of transactions other than (i) to another Obligor, (ii) by a Foreign
Subsidiary to any other Foreign Subsidiary or (iii) by a Receivables Subsidiary
to any other Person.
     “Dividend” is defined in the first recital.
     “Documentation Agents” is defined in the preamble.
     “Dollar” and the sign “$” mean lawful money of the United States.
     “Dollar Equivalent” means, as of any date of determination, (i) as to any
amount denominated in Dollars, such amount in Dollars, and (ii) as to any amount
denominated in Euros, the equivalent amount thereof in Dollars as determined by
the Administrative Agent on the basis of the Spot Rate for the purchase of
Dollars with Euros.
     “Domestic Office” means the office of a Lender designated as its “Domestic
Office” on Schedule II hereto or in a Lender Assignment Agreement, or such other
office within the United States as may be designated from time to time by notice
from such Lender to the Administrative Agent and the Borrower.
     “EBITDA” means, for any applicable period, the sum of
     (a) Net Income, plus
     (b) to the extent deducted in determining Net Income, the sum of
(i) amounts attributable to amortization (including amortization of goodwill and
other intangible assets), (ii) Federal, state, local and foreign income
withholding, franchise, state single business unitary and similar Tax expense,
(iii) Interest Expense, (iv) depreciation of assets, (v) all non-cash charges,
including all non-cash charges associated with announced restructurings, whether
announced previously or in the future (such non-cash restructuring charges being
“Non-Cash Restructuring Charges”), (vi) net cash charges associated with or
related to any contemplated restructurings (such cost restructuring charges
being “Cash Restructuring Charges”) in an aggregate amount not to exceed, in any
Fiscal Year, the Permitted Cash Restructuring Charge Amount for such Fiscal
Year, (vii) net cash restructuring charges associated with or related to the
Spin-Off (such cost restructuring charges being “Cash Spin-Off Charges”) in an
aggregate amount not to exceed, in any Fiscal Year, the Permitted Cash Spin-Off
Charge Amount for such Fiscal Year, (viii) all amounts in respect of
extraordinary losses, (ix) non-cash compensation expense, or other non-cash
expenses or charges, arising from the sale of stock, the granting of stock
options, the granting of stock appreciation rights and similar arrangements
(including any repricing, amendment, modification, substitution or change of any
such stock, stock option, stock appreciation rights or similar arrangements),
(x)
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any financial advisory fees, accounting fees, legal fees and other similar
advisory and consulting fees, cash charges in respect of strategic market
reviews, management bonuses and early retirement of Indebtedness, and related
out-of-pocket expenses incurred by the Borrower or any of its Subsidiaries as a
result of the Transaction, including fees and expenses in connection with the
issuance, redemption or exchange of the Bridge Loans, all determined in
accordance with GAAP, (xi) non-cash or unrealized losses on agreements with
respect to Hedging Obligations and (xii) to the extent non-recurring and not
capitalized, any financial advisory fees, accounting fees, legal fees and
similar advisory and consulting fees and related costs and expenses of the
Borrower and its Subsidiaries incurred as a result of Permitted Acquisitions,
Investments, Dispositions permitted hereunder and the issuance of Capital
Securities or Indebtedness permitted hereunder, all determined in accordance
with GAAP and in each case eliminating any increase or decrease in income
resulting from non-cash accounting adjustments made in connection with the
related Permitted Acquisition or Dispositions, (xiii) to the extent the related
loss in not added back pursuant to clause (c), all proceeds of business
interruption insurance policies, (xiv) expenses incurred by the Borrower or any
Subsidiary to the extent reimbursed in cash by a third party, and (xv)
extraordinary, unusual or non-recurring cash charges not to exceed $10,000,000
in any Fiscal Year, minus
     (c) to the extent included in determining such Net Income, the sum of
(i) all amounts in respect of extraordinary gains or extraordinary losses,
(ii) non-cash gains on agreements with respect to Hedging Obligations,
(iii) reversals (in whole or in part) of any restructuring charges previously
treated as Non-Cash Restructuring Charges in any prior period and (iv) non-cash
items increasing such Net Income for such period, other than (A) the accrual of
revenue consistent with past practice and (B) the reversal in such period of an
accrual of, or cash reserve for, cash expenses in a prior period, to the extent
such accrual or reserve did not increase EBITDA in a prior period.
     “Eligible Assignee” means (i) in the case of an assignment of a Term B
Loan, (A) a Lender, (B) an Affiliate of a Lender, (C) an Approved Fund or
(D) any other Person (other than an Ineligible Assignee), and (ii) in the case
of any assignment of the Revolving Loan Commitment, Revolving Loans or Term A
Loans, (A) a Lender, (B) an Affiliate of a Lender or (C) any other Person (other
than an Ineligible Assignee) approved by the Borrower (such approval of the
Borrower not to be unreasonably withheld or delayed) unless an Event of Default
has occurred and is continuing.
     “EMU” means Economic and Monetary Union as contemplated in the Treaty on
European Union.
     “EMU Legislation” means legislative measures of the European Council
(including European Council regulations) for the introduction of, changeover to
or operation of a single or unified European currency (whether known as the Euro
or otherwise), being in part the implementation of the third stage of EMU.
     “Environmental Laws” means all applicable federal, state or local statutes,
laws, ordinances, codes, rules, regulations and legally binding guidelines
(including consent decrees
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and administrative orders) relating to protection of public health and safety
from environmental hazards and protection of the environment.
     “Equity Equivalents” means with respect to any Person any rights, warrants,
options, convertible securities, exchangeable securities, indebtedness or other
rights, in each case exercisable for or convertible or exchangeable into,
directly or indirectly, Capital Securities of such Person or securities
exercisable for or convertible or exchangeable into Capital Securities of such
Person, whether at the time of issuance or upon the passage of time or the
occurrence of some future event.
     “ERISA” means the Employee Retirement Income Security Act of 1974, as
amended, and any successor statute thereto of similar import, together with the
regulations thereunder, in each case as in effect from time to time. References
to Sections of ERISA also refer to any successor Sections thereto.
     “Euro Equivalent” means, with respect to any amount denominated in Dollars,
the equivalent amount thereof in Euros as determined by the Administrative Agent
at such time on the basis of the Spot Rate (determined in respect of the most
recent Revaluation Date) for the purchase of Euros with Dollars.
     “Euro Loan” means any Revolving Loan denominated in Euros.
     “Euro Loan Commitment” means, relative to any Lender, such Lender’s
obligation (if any) to make Euro Loans pursuant to clause (a) of Section 2.1.1.
     “Euro Loan Commitment Amount” means, on any date, a maximum amount equal to
the Euro Equivalent of $50,000,000, as such amount may be permanently reduced by
Section 2.2.
     “European TM SPV” means Playtex Bath LLC, a Delaware limited liability
company.
     “Euros” means the single currency of Participating Member States of the
European Union.
     “Event of Default” is defined in Section 8.1.
     “Excess Cash Flow” means, for any Fiscal Year, the excess (if any), of
     (a) EBITDA for such Fiscal Year
     minus
     (b) the sum (for such Fiscal Year) of (i) Interest Expense actually paid in
cash by the Borrower and its Subsidiaries, (ii) scheduled principal repayments
with respect to the permanent reduction of Indebtedness, to the extent actually
made and permitted to be made hereunder, (iii) all Federal, state, local and
foreign income withholding, franchise, state single business unitary and similar
Taxes actually paid in cash or payable (only to the extent related to Taxes
associated with such Fiscal Year) by the Borrower and its Subsidiaries, (iv)
Capital Expenditures to the extent (x) actually made by the Borrower and its
Subsidiaries in such Fiscal Year or (y) committed to be made by the Borrower
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and its Subsidiaries and that are permitted to be carried forward to the next
succeeding Fiscal Year pursuant to Section 7.2.7; provided that the amounts
deducted from Excess Cash Flow pursuant to preceding clause (y) shall not
thereafter be deducted in the determination of Excess Cash Flow for the Fiscal
Year during which such payments were actually made, (v) the portion of the
purchase price paid in cash with respect to Permitted Acquisitions to the extent
such Permitted Acquisition was made in connection with the Borrower’s offshore
migration of its supply chain, (vi) cash Investments permitted to be made in
Foreign Supply Chain Entities, (vii) to the extent permitted to be included in
the calculation of EBITDA for such Fiscal Year, the amount of Cash Restructuring
Charges and Cash Spin-Off Charges actually so included in such calculation and
(viii) without duplication to any amounts deducted in preceding clauses
(i) through (vii), all items added back to EBITDA pursuant to clause (b) of the
definition thereof that represent amounts actually paid in cash.
     “Exemption Certificate” is defined in clause (e) of Section 4.6.
     “Exchange Act” means the Securities Exchange Act of 1934, as amended.
     “Existing Letters of Credit” means each of the Letters of Credit issued by
an Issuer and outstanding on the Closing Date, as listed on Schedule III hereto.
     “Excluded Contracts” means the intellectual property rights, licenses,
leases and other agreements set forth in Item 1.2 of the Disclosure Schedule.
     “Excluded Equity Proceeds Amount” means with respect to the sale or
issuance of Capital Securities of the Borrower, an amount equal to the proceeds
(net of all fees, commissions, disbursements, costs and expenses incurred in
connection therewith) thereof which are utilized for Capital Expenditures or
Permitted Acquisitions less the amount of such proceeds which have been
previously used for such purposes.
     “Federal Funds Rate” means, for any period, a fluctuating interest rate per
annum equal for each day during such period to (i) the weighted average of the
rates on overnight federal funds transactions with members of the Federal
Reserve System arranged by federal funds brokers, as published for such day (or,
if such day is not a Business Day, for the next preceding Business Day) by the
Federal Reserve Bank of New York, or (ii) if such rate is not so published for
any day which is a Business Day, the average of the quotations for such day on
such transactions received by the Administrative Agent from three federal funds
brokers of recognized standing selected by it.
     “Fee Letter” means the confidential letter, dated July 24, 2006, among
Merrill Lynch, Morgan Stanley and the Borrower.
     “Filing Agent” is defined in Section 5.1.11.
     “Filing Statements” is defined in Section 5.1.11.
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     “Fiscal Quarter” means a quarter ending on the Saturday nearest to the last
day of March, June, September or December.
     “Fiscal Year” means any period of fifty-two or fifty-three consecutive
calendar weeks ending on the Saturday nearest to the last day of June;
references to a Fiscal Year with a number corresponding to any calendar year
(e.g., the “2006 Fiscal Year”) refer to the Fiscal Year ending on the Saturday
nearest to the last day of June of such calendar year; provided that in the
event that the Company gives notice to the Administrative Agent that it intends
to change its Fiscal Year, Fiscal Year will mean any period of fifty-two or
fifty-three consecutive calendar weeks or twelve consecutive calendar months
ending on the date set forth in such notice.
     “Foreign Pledge Agreement” means any supplemental pledge agreement governed
by the laws of a jurisdiction other than the United States or a State thereof
executed and delivered by the Borrower or any of its Subsidiaries pursuant to
the terms of this Agreement, in form and substance reasonably satisfactory to
the Lead Arrangers, as necessary under the laws of organization or incorporation
of a Foreign Subsidiary to further protect or perfect the Lien on and security
interest in any Capital Securities issued by such Foreign Subsidiary
constituting Collateral (as defined in the Security Agreement).
     “Foreign Subsidiary” means any Subsidiary that is not a U.S. Subsidiary or
a Receivables Subsidiary.
     “Foreign Supply Chain Entity” means (i) a Person listed on Item 1.1 of the
Disclosure Schedule and (ii) any other Person (a) that is not organized or
incorporated under the laws of the United States, (b) the Capital Securities of
which are owned by the Borrower or any of its Subsidiaries and another Person
who is not the Borrower or any Subsidiary (other than a third party represented
by any director’s qualifying shares or investments by foreign nationals mandated
by applicable laws), (c) that is created in connection with the Borrower’s
offshore migration of its supply chain and (d) any Investments in such Person
are to be made pursuant to clause (f) of Section 7.2.5 or clause (f) of
Section 7.2.2; provided that the Borrower may, upon notice to the Administrative
Agent, redesignate any Person who was, before such redesignation, a Foreign
Supply Chain Entity as a Foreign Subsidiary and at such time such Foreign Supply
Chain Entity will be treated as a Foreign Subsidiary for all purposes hereunder.
     “Foreign Working Capital Lender” means each Person that is (or at the time
such Indebtedness was incurred, was) a Lender or an Affiliate of a Lender to
whom a Foreign Subsidiary owes Indebtedness that was permitted to be incurred
pursuant to clause (n) of Section 7.2.2.
     “F.R.S. Board” means the Board of Governors of the Federal Reserve System
or any successor thereto.
     “GAAP” is defined in Section 1.4.
     “Governmental Authority” means the government of the United States, any
other nation or any political subdivision thereof, whether state or local, and
any agency, authority, instrumentality, regulatory body, court, central bank or
other entity exercising executive,
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legislative, judicial, taxing, regulatory or administrative powers or functions
of or pertaining to government.
     “Guaranty” means the guaranty executed and delivered by an Authorized
Officer of the Borrower and each U.S. Subsidiary pursuant to the terms of this
Agreement, substantially in the form of Exhibit F hereto, as amended,
supplemented, amended and restated or otherwise modified from time to time.
     “Hazardous Material” means (i) any “hazardous substance”, as defined by
CERCLA, (ii) any “hazardous waste”, as defined by the Resource Conservation and
Recovery Act, as amended, or (iii) any pollutant or contaminant or hazardous,
dangerous or toxic chemical, material or substance (including any petroleum
product) within the meaning of any other applicable federal, state or local law,
regulation, ordinance or requirement (including consent decrees and
administrative orders) relating to or imposing liability or standards of conduct
concerning any hazardous, toxic or dangerous waste, substance or material, all
as amended.
     “HBI IP” is defined in the first recital.
     “Hedging Obligations” means, with respect to any Person, all liabilities of
such Person under foreign exchange contracts, commodity hedging agreements,
currency exchange agreements, interest rate swap agreements, interest rate cap
agreements and interest rate collar agreements, and all other agreements or
arrangements designed to protect such Person against fluctuations in interest
rates, currency exchange rates or commodity prices.
     “herein”, “hereof”, “hereto”, “hereunder” and similar terms contained in
any Loan Document refer to such Loan Document as a whole and not to any
particular Section, paragraph or provision of such Loan Document.
     “HSBC” means HSBC Bank USA, National Association, in its individual
capacity, and any successor thereto by merger, consolidation or otherwise.
     “Impermissible Qualification” means any qualification or exception to the
opinion or certification of any independent public accountant as to any
financial statement of the Borrower (i) which is of a “going concern” or similar
nature, (ii) which relates to the limited scope in any material respect of
examination of matters relevant to such financial statement, or (iii) which
relates to the treatment or classification of any item in such financial
statement (excluding treatment or classification changes which are the result of
changes in GAAP or the interpretation of GAAP) and which, as a condition to its
removal, would require an adjustment to such item the effect of which would be
to cause the Borrower to be in Default.
     “including” and “include” means including without limiting the generality
of any description preceding such term, and, for purposes of each Loan Document,
the parties hereto agree that the rule of ejusdem generis shall not be
applicable to limit a general statement, which is followed by or referable to an
enumeration of specific matters, to matters similar to the matters specifically
mentioned.
     “Indebtedness” of any Person means, (i) all obligations of such Person for
borrowed money or advances and all obligations of such Person evidenced by
bonds, debentures, notes or
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similar instruments, (ii) all monetary obligations, contingent or otherwise,
relative to the face amount of all letters of credit, whether or not drawn, and
banker’s acceptances issued for the account of such Person, (iii) all
Capitalized Lease Liabilities of such Person, (iv) for purposes of Section 8.1.5
only, net Hedging Obligations of such Person, (v) whether or not so included as
liabilities in accordance with GAAP, all obligations of such Person to pay the
deferred purchase price of property or services (excluding trade accounts
payable and accrued expenses in the ordinary course of business which are not
overdue for a period of more than 90 days or, if overdue for more than 90 days,
as to which a dispute exists and adequate reserves in conformity with GAAP have
been established on the books of such Person), (vi) indebtedness secured by (or
for which the holder of such indebtedness has an existing right, contingent or
otherwise, to be secured by) a Lien on property owned or being acquired by such
Person (including indebtedness arising under conditional sales or other title
retention agreements), whether or not such indebtedness shall have been assumed
by such Person or is limited in recourse (provided that in the event such
indebtedness is limited in recourse solely to the property subject to such Lien,
for the purposes of this Agreement the amount of such indebtedness shall not
exceed the greater of the book value or the fair market value (as determined in
good faith by the Borrower’s board of directors) of the property subject to such
Lien), (vii) monetary obligations arising under Synthetic Leases, (viii) the
full outstanding balance of trade receivables, notes or other instruments sold
with full recourse (and the portion thereof subject to potential recourse, if
sold with limited recourse), other than in any such case any thereof sold solely
for purposes of collection of delinquent accounts and other than in connection
with any Permitted Securitization, (ix) all obligations (other than intercompany
obligations) of such Person pursuant to any Permitted Securitization (other than
Standard Securitization Undertakings), and (x) all Contingent Liabilities of
such Person in respect of any of the foregoing. The Indebtedness of any Person
shall include the Indebtedness of any other Person (including any partnership in
which such Person is a general partner) to the extent such Person is liable
therefore as a result of such Person’s ownership interest in or other
relationship with such Person, except to the extent the terms of such
Indebtedness provide that such Person is not liable therefore.
     “Indemnified Liabilities” is defined in Section 10.4.
     “Indemnified Parties” is defined in Section 10.4.
     “Ineligible Assignee” means a natural Person, the Borrower, any Affiliate
of the Borrower or any other Person taking direction from, or working in concert
with, the Borrower or any of the Borrower’s Affiliates.
     “Information” is defined in Section 10.18.
     “Interco Subordination Agreement” means a Subordination Agreement, in form
and substance satisfactory to the Lead Arrangers, executed and delivered by two
or more Obligors pursuant to the terms of this Agreement, as amended,
supplemented, amended and restated or otherwise modified from time to time.
     “Intercreditor Agreement” means the Intercreditor Agreement, dated as of
the Closing Date, executed and delivered by each Person party thereto,
substantially in the form of Exhibit H
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hereto, as amended, supplemented, amended and restated or otherwise modified
from time to time.
     “Interest Coverage Ratio” means, as of the last day of any Fiscal Quarter,
the ratio computed for the period consisting of such Fiscal Quarter and each of
the three immediately preceding Fiscal Quarters of:
     (a) EBITDA (for all such Fiscal Quarters)
     to
     (b) the sum (for all such Fiscal Quarters) of Interest Expense;
provided that, for purposes of calculating (i) Interest Expense with respect to
the calculation of the Interest Coverage Ratio with respect to the four
consecutive Fiscal Quarter period ending (A) nearest to December 31, 2006,
Interest Expense shall be actual Interest Expense for the Fiscal Quarter ending
nearest to December 31, 2006 multiplied by four, (B) nearest to March 31, 2007,
Interest Expense shall be actual Interest Expense for the two Fiscal Quarter
period ending nearest to March 31, 2007 multiplied by two, and (C) nearest to
June 30, 2007, Interest Expense shall be actual Interest Expense for the three
Fiscal Quarter period ending nearest to June 30, 2007 multiplied by one and
one-third and (ii) EBITDA with respect to the calculation of the Interest
Coverage such calculation shall be made in accordance with the proviso to the
definition of “Leverage Ratio.”
     “Interest Expense” means, for any applicable period, the aggregate interest
expense (both, without duplication, when accrued or paid and net of interest
income paid during such period to the Borrower and its Subsidiaries) of the
Borrower and its Subsidiaries for such applicable period, including the portion
of any payments made in respect of Capitalized Lease Liabilities allocable to
interest expense.
     “Interest Period” means, relative to any LIBO Rate Loan, the period
beginning on (and including) the date on which such LIBO Rate Loan is made or
continued as, or converted into, a LIBO Rate Loan pursuant to Sections 2.3 or
2.4 and shall end on (but exclude) the day which numerically corresponds to such
date one, two, three or six months and, if available to all Lenders, one or two
weeks or 9 or 12 months thereafter (or, if any such month has no numerically
corresponding day, on the last Business Day of such month), as the Borrower may
select in its relevant notice pursuant to Sections 2.3 or 2.4; provided that,
     (a) the Borrower shall not be permitted to select Interest Periods to be in
effect at any one time which have expiration dates occurring on more than twelve
different dates; and
     (b) if such Interest Period would otherwise end on a day which is not a
Business Day, such Interest Period shall end on the next following Business Day
(unless such next following Business Day is the first Business Day of a calendar
month, in which case such Interest Period shall end on the Business Day next
preceding such numerically corresponding day).
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     “Investment” means, relative to any Person, (i) any loan, advance or
extension of credit made by such Person to any other Person, including the
purchase by such Person of any bonds, notes, debentures or other debt securities
of any other Person, and (ii) any Capital Securities held by such Person in any
other Person. The amount of any Investment shall be the original principal or
capital amount thereof less all returns of principal or equity thereon and
shall, if made by the transfer or exchange of property other than cash, be
deemed to have been made in an original principal or capital amount equal to the
fair market value of such property at the time of such Investment.
     “IP Purchase” is defined in the first recital.
     “IP Subsidiary” is defined in the first recital.
     “ISP Rules” is defined in Section 10.9.
     “Issuance Request” means a Letter of Credit request and certificate duly
executed by an Authorized Officer of the Borrower, substantially in the form of
Exhibit B-2 hereto, or in such electronic format as an Issuer and the
Administrative Agent in their discretion accept. Each Issuance Request delivered
in an electronic format shall constitute for all purposes of this Agreement a
certification by an Authorized Officer as to the matters set forth in Exhibit
B-2.
     “Issuer” means HSBC or another Lender selected by the Borrower and
reasonably acceptable to the Administrative Agent, in each case, in its capacity
as an Issuer of the Letters of Credit. At the request of HSBC and with the
Borrower’s consent (not to be unreasonably withheld or delayed), another Lender
or an Affiliate of HSBC may issue one or more Letters of Credit hereunder, in
which case the term “Issuer” shall include any such Affiliate or other Lender
with respect to Letters of Credit issued by such Affiliate or such Lender.
     “Judgment Currency” is defined in Section 10.16.
     “Lead Arrangers” is defined in the preamble.
     “Lender Assignment Agreement” means an assignment agreement substantially
in the form of Exhibit D hereto.
     “Lenders” is defined in the preamble.
     “Lender’s Environmental Liability” means any and all losses, liabilities,
obligations, penalties, claims, litigation, demands, defenses, costs, judgments,
suits, proceedings, damages (including consequential damages), disbursements or
expenses of any kind or nature whatsoever (including reasonable attorneys’ fees
at trial and appellate levels and experts’ fees and disbursements and expenses
incurred in investigating, defending against or prosecuting any litigation,
claim or proceeding) which may at any time be imposed upon, incurred by or
asserted or awarded against the Administrative Agent, any Lender or any Issuer
or any of such Person’s Affiliates, shareholders, directors, officers,
employees, and agents in connection with or arising from:
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     (a) any Hazardous Material on, in, under or affecting all or any portion of
any property of the Borrower or any of its Subsidiaries, the groundwater
thereunder, or any surrounding areas thereof to the extent caused by Releases
from the Borrower’s or any of its Subsidiaries’ or any of their respective
predecessors’ properties;
     (b) any misrepresentation, inaccuracy or breach of any warranty, contained
or referred to in Section 6.12;
     (c) any violation or claim of violation by the Borrower or any of its
Subsidiaries of any Environmental Laws; or
     (d) the imposition of any lien for damages caused by or the recovery of any
costs for the cleanup, release or threatened release of Hazardous Material by
the Borrower or any of its Subsidiaries, or in connection with any property
owned or formerly owned by the Borrower or any of its Subsidiaries.
     “Letter of Credit” means a letter of credit that is a Standby Letter of
Credit or Commercial Letter of Credit. For greater certainty Letters of Credit
shall include all Existing Letters of Credit.
     “Letter of Credit Commitment” means an Issuer’s obligation to issue Letters
of Credit pursuant to Section 2.1.2.
     “Letter of Credit Commitment Amount” means, on any date, a maximum amount
equal to the Dollar Equivalent of $150,000,000, as such amount may be
permanently reduced from time to time pursuant to Section 2.2.
     “Letter of Credit Outstandings” means, on any date, an amount equal to the
sum of (i) the then aggregate amount which is undrawn and available under all
issued and outstanding Letters of Credit, and (ii) the then aggregate amount of
all unpaid and outstanding Reimbursement Obligations.
     “Leverage Ratio” means, as of the last day of any Fiscal Quarter, the ratio
of
     (a) Total Debt outstanding on the last day of such Fiscal Quarter
     to
     (b) EBITDA computed for the period consisting of such Fiscal Quarter and
each of the three immediately preceding Fiscal Quarters;
provided that, for purposes of calculating the Leverage Ratio with respect to
the four consecutive Fiscal Quarter period ending (i) nearest to December 31,
2006, EBITDA shall be actual EBITDA for the Fiscal Quarter ending nearest to
December 31, 2006 multiplied by four; (ii) nearest to March 31, 2007, EBITDA
shall be actual EBITDA for the two Fiscal Quarter period ending nearest to
March 31, 2007 multiplied by two; and (iii) nearest to June 30, 2007, EBITDA
shall be actual EBITDA for the three Fiscal Quarter period ending nearest to
June 30, 2007 multiplied by one and one-third.
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     “LIBO Alternate Rate” means, with respect to any Euro Loan, relative to an
interest period of one month, that rate of interest determined by the
Administrative Agent by reference to the cost to the Administrative Agent of
obtaining deposits of Euros from such sources as it may reasonably select. The
Administrative Agent shall determine the LIBO Alternate Rate for each such
interest period (which determination shall be conclusive in the absence of
manifest error), and will promptly give notice to the Borrower and the Lenders
thereof.
     “LIBO Rate” means, relative to any Interest Period:
     (a) for LIBO Rate Loans denominated in Dollars, the rate of interest equal
to the average (rounded upwards, if necessary, to the nearest 1/16 of 1%) of the
rates per annum at which Dollar deposits in immediately available funds are
offered to the Administrative Agent’s LIBOR Office in the London interbank
market as at or about 11:00 a.m. London, England time two Business Days prior to
the beginning of such Interest Period for delivery on the first day of such
Interest Period, and in an amount approximately equal to the amount of the
Administrative Agent’s LIBO Rate Loan and for a period approximately equal to
such Interest Period; and
     (b) for LIBO Rate Loans denominated in Euros, the rate of interest equal to
the average (rounded upward, if necessary, to the next 1/16 of 1%) of the rates
per annum determined by the Administrative Agent as the rate at which Euro
deposits in immediately available funds are offered to the Administrative
Agent’s LIBOR Office (or such other office as may be designated by the
Administrative Agent) to major banks in the offshore interbank market at
approximately 11:00 a.m., two Business Days prior to (or on such other date as
is customary in the relevant offshore interbank market) the beginning of such
Interest Period for delivery on the first day of such Interest Period, and in an
amount approximately equal to the amount of the Administrative Agent’s LIBO Rate
Loan and for a period approximately equal to such Interest Period.
     “LIBO Rate Loan” means a Loan bearing interest, at all times during an
Interest Period applicable to such Loan, at a rate of interest determined by
reference to the LIBO Rate (Reserve Adjusted) or, if not available, the LIBO
Alternate Rate.
     “LIBO Rate (Reserve Adjusted)” means, relative to any Loan to be made,
continued or maintained as, or converted into, a LIBO Rate Loan for any Interest
Period, a rate per annum (rounded upwards, if necessary, to the nearest 1/16 of
1%) determined pursuant to the following formula:

            LIBO Rate   =   LIBO Rate               (Reserve Adjusted)      
1.00 — LIBOR Reserve Percentage  

The LIBO Rate (Reserve Adjusted) for any Interest Period for LIBO Rate Loans
will be determined by the Administrative Agent on the basis of the LIBOR Reserve
Percentage in effect, and the applicable rates furnished to and received by the
Administrative Agent, two Business Days before the first day of such Interest
Period.
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     “LIBOR Office” means the office of a Lender designated as its “LIBOR
Office” on Schedule II hereto or in a Lender Assignment Agreement, or such other
office designated from time to time by notice from such Lender to the Borrower
and the Administrative Agent, whether or not outside the United States, which
shall be making or maintaining the LIBO Rate Loans of such Lender.
     “LIBOR Reserve Percentage” means, relative to any Interest Period for LIBO
Rate Loans, the reserve percentage (expressed as a decimal) equal to the maximum
aggregate reserve requirements (including all basic, emergency, supplemental,
marginal and other reserves and taking into account any transitional adjustments
or other scheduled changes in reserve requirements) specified under regulations
issued from time to time by the F.R.S. Board and then applicable to assets or
liabilities consisting of or including “Eurocurrency Liabilities”, as currently
defined in Regulation D of the F.R.S. Board, having a term approximately equal
or comparable to such Interest Period.
     “Lien” means any security interest, mortgage, pledge, hypothecation,
assignment, deposit arrangement, encumbrance, lien (statutory or otherwise),
charge against or interest in property, or other priority or preferential
arrangement of any kind or nature whatsoever.
     “Loan Documents” means, collectively, this Agreement, the Notes, the
Letters of Credit, each Rate Protection Agreement, the Fee Letter, the
Intercreditor Agreement, the Security Agreement, each Mortgage, each Foreign
Pledge Agreement, each other agreement pursuant to which the Collateral Agent is
granted by the Borrower or its Subsidiaries a Lien to secure the Obligations,
the Guaranty and each other agreement, certificate, document or instrument
delivered in connection with any Loan Document, whether or not specifically
mentioned herein or therein.
     “Loans” means, as the context may require, a Revolving Loan, a Euro Loan, a
Term Loan or a Swing Line Loan of any type.
     “Material Adverse Effect” means a material adverse effect on (i) the
business, financial condition, operations, performance, or assets of the
Borrower or the Borrower and its Subsidiaries (other than a Receivables
Subsidiary) taken as a whole, (ii) the rights and remedies of any Secured Party
under any Loan Document or (iii) the ability of any Obligor to perform when due
its Obligations under any Loan Document.
     “Merrill Lynch” means Merrill Lynch Capital Corporation, in its individual
capacity, and includes any successor Person thereto by merger, consolidation or
otherwise.
     “Moody’s” means Moody’s Investors Service, Inc. and its successors.
     “Morgan Stanley” means Morgan Stanley Senior Funding, Inc., in its
individual capacity, and includes any successor Person thereto by merger,
consolidation or otherwise.
     “Mortgage” means each mortgage, deed of trust or agreement executed and
delivered by any Obligor in favor of the Administrative Agent for the benefit of
the Secured Parties pursuant to the requirements of this Agreement in form and
substance reasonably satisfactory to the Lead Arrangers, under which a Lien is
granted on such real property and fixtures described therein, in
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each case as amended, supplemented, amended and restated or otherwise modified
from time to time.
     “Mortgaged Property” means each parcel of real property owned by an Obligor
in the United States on the Closing Date with a fair market value (as determined
by the Borrower in good faith) in excess of $2,000,000 on the Closing Date.
     “Net Casualty Proceeds” means, with respect to any Casualty Event, the
amount of any insurance proceeds or condemnation awards received by the Borrower
or any of its U.S. Subsidiaries in connection with such Casualty Event (net of
all collection or similar expenses related thereto), but excluding any proceeds
or awards required to be paid to a creditor (other than the Lenders) which holds
a first priority Lien permitted by clause (d) of Section 7.2.3 on the property
which is the subject of such Casualty Event.
     “Net Debt Proceeds” means, with respect to the sale or issuance by the
Borrower or any of its U.S. Subsidiaries (other than a Receivables Subsidiary)
of any Indebtedness to any other Person after the Closing Date pursuant to
clause (b)(ii) of Section 7.2.2 or which is not expressly permitted by
Section 7.2.2, the excess of (i) the gross cash proceeds actually received by
such Person from such sale or issuance, over (ii) all arranging or underwriting
discounts, fees, costs, expenses and commissions, and all legal, investment
banking, brokerage and accounting and other professional fees, sales commissions
and disbursements and other closing costs and expenses actually incurred in
connection with such sale or issuance other than any such fees, discounts,
commissions or disbursements paid to Affiliates of the Borrower or any such
Subsidiary in connection therewith.
     “Net Disposition Proceeds” means the gross cash proceeds received by the
Borrower or its U.S. Subsidiaries from any Disposition pursuant to clauses (j)
(l), (m) or (n) of Section 7.2.11 or Section 7.2.15 and any cash payment
received in respect of promissory notes or other non-cash consideration
delivered to the Borrower or its U.S. Subsidiaries in respect thereof, minus the
sum of (i) all legal, investment banking, brokerage, accounting and other
professional fees, costs, sales commissions and expenses and other closing
costs, fees and expenses incurred in connection with such Disposition, (ii) all
taxes actually paid or estimated by the Borrower to be payable in cash in
connection with such Disposition, (iii) payments made by the Borrower or its
U.S. Subsidiaries to retire Indebtedness (other than the Credit Extensions)
where payment of such Indebtedness is required in connection with such
Disposition and (iv) any liability reserves established by the Borrower or such
Subsidiary in respect of such Disposition in accordance with GAAP; provided
that, if the amount of any estimated taxes pursuant to clause (ii) exceeds the
amount of taxes actually required to be paid in cash in respect of such
Disposition, the aggregate amount of such excess shall constitute Net
Disposition Proceeds and to the extent any such reserves described in clause
(iv) are not fully used at the end of any applicable period for which such
reserves were established, such unused portion of such reserves shall constitute
Net Disposition Proceeds.
     “Net Equity Proceeds” means with respect to the sale or issuance after the
Closing Date by the Borrower to any Person of its Capital Securities, warrants
or options or the exercise of any such warrants or options (other than such
Capital Securities, warrants and options, in each case with respect to common or
ordinary equity interests, issued (i) by the Borrower pursuant to the
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Borrower’s equity incentive plans, (ii) to qualified employees, officers and
directors as compensation or to qualify employees, officers and directors as
required by applicable law, (iii) that constitute an Excluded Equity Proceeds
Amount or (iv) by the Borrower to a wholly owned Subsidiary of the Borrower),
the excess of (A) the gross cash proceeds received by such Person from such
sale, exercise or issuance, over (B) the sum of (i) all arranging, underwriting
commissions and legal, investment banking, brokerage and accounting and other
professional fees, sales commissions and disbursements and other closing costs
and expenses actually incurred in connection with such sale or issuance which
have not been paid to Affiliates of the Borrower in connection therewith and
(ii) all taxes actually paid or estimated by the Borrower to be payable in cash
in connection with such sale or issuance; provided that, if the amount of any
estimated taxes pursuant to clause (B)(ii) exceeds the amount of taxes actually
required to be paid in cash in respect of such sale or issuance, the aggregate
amount of such excess shall constitute Net Equity Proceeds.
     “Net Income” means, for any period, the aggregate of all amounts which
would be included as net income on the consolidated financial statements of the
Borrower and its Subsidiaries for such period; provided that, for purposes of
this Agreement, the calculation of Net Income shall not include any net income
of any Foreign Supply Chain Entity, except to the extent cash is distributed by
such Foreign Supply Chain Entity during such period to the Borrower or any other
Subsidiary as a dividend or other distribution.
     “Net Receivables Proceeds” means (i) the gross amount invested (in the form
of a loan, purchased interest, or otherwise) by a Person other than the Borrower
or a Subsidiary in a Receivables Subsidiary or the Receivables or an interest in
the Receivables held by a Receivables Subsidiary in connection with a Permitted
Securitization minus (ii) the sum of (a) all reasonable and customary legal,
investment banking, brokerage and accounting and other professional fees, costs
and expenses incurred in connection with such Permitted Securitization, (b) all
taxes actually paid or estimated by the Borrower to be payable in connection
with such Permitted Securitization, and (c) payments made by the Borrower or its
U.S. Subsidiaries to retire Indebtedness (other than the Credit Extensions)
where payment of such Indebtedness is required in connection with such Permitted
Securitization; provided that, if the amount of any estimated taxes pursuant to
clause (ii)(b) exceeds the amount of taxes actually required to be paid in cash
in respect of such Permitted Securitization, the aggregate amount of such excess
shall constitute Net Receivables Proceeds; it being understood that the
calculation of Net Receivables Proceeds with respect to any additional or
subsequent investment in connection with a Permitted Securitization shall
include only the increase in such investment over the previous highest
investment used in a prior calculation and expenses, taxes and repayments not
included in a prior calculation.
     “Non-Cash Restructuring Charges” is defined in the definition of “EBITDA”.
     “Non-Consenting Lender” is defined in Section 4.11.
     “Non Defaulting Lender” means a Lender other than a Defaulting Lender.
     “Non-Excluded Taxes” means any Taxes other than (i) net income and
franchise Taxes imposed on (or measured by) net income or net profits with
respect to any Secured Party by any
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Governmental Authority under the laws of which such Secured Party is organized
or in which it maintains its applicable lending office and (ii) any branch
profit taxes or any similar taxes imposed by the United States of America or any
other Governmental Authority described in clause (ii).
     “Non-U.S. Lender” means any Lender that is not a “United States person”, as
defined under Section 7701(a)(30) of the Code.
     “Note” means, as the context may require, a Revolving Note, a Term A Note,
a Term B Note or a Swing Line Note.
     “Obligations” means all obligations (monetary or otherwise, whether
absolute or contingent, matured or unmatured) of the Borrower and each other
Obligor arising under or in connection with a Loan Document, including
Reimbursement Obligations and the principal of and premium, if any, and interest
(including interest accruing during the pendency of any proceeding of the type
described in Section 8.1.9, whether or not allowed in such proceeding) on the
Loans.
     “Obligor” means, as the context may require, the Borrower, each Subsidiary
Guarantor and each other Person (other than a Secured Party) obligated (other
than Persons solely consenting to or acknowledging such document) under any Loan
Document.
     “OFAC” is defined in Section 6.15.
     “Organic Document” means, relative to any Obligor, as applicable, its
articles or certificate of incorporation, by-laws, certificate of partnership,
partnership agreement, certificate of formation, limited liability agreement,
operating agreement and all shareholder agreements, voting trusts and similar
arrangements applicable to any of such Obligor’s Capital Securities.
     “Original Currency” is defined in Section 10.16.
     “Other Taxes” means any and all stamp, documentary or similar Taxes, or any
other excise or property Taxes or similar levies that arise on account of any
payment made or required to be made under any Loan Document or from the
execution, delivery, registration, recording or enforcement of any Loan
Document.
     “Participant” is defined in clause (e) of Section 10.11.
     “Participating Member State” means each country so described in any EMU
Legislation.
     “Patent Security Agreement” means any Patent Security Agreement executed
and delivered by any Obligor in substantially the form of Exhibit A to the
Security Agreement, as amended, supplemented, amended and restated or otherwise
modified from time to time.
     “Patriot Act” means the USA PATRIOT Act (Title III of Pub. L. 107-56
(signed into law October 26, 2001)), as amended and supplemented from time to
time.
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     “Patriot Act Disclosures” means all documentation and other information
available to the Borrower or its Subsidiaries which a Lender, if subject to the
Patriot Act, is required to provide pursuant to the applicable section of the
Patriot Act and which required documentation and information the Administrative
Agent or any Lender reasonably requests in order to comply with their ongoing
obligations under applicable “know your customer” and anti-money laundering
rules and regulations, including the Patriot Act.
     “PBGC” means the Pension Benefit Guaranty Corporation and any Person
succeeding to any or all of its functions under ERISA.
     “Pension Plan” means a “pension plan”, as such term is defined in
Section 3(2) of ERISA, which is subject to Title IV of ERISA (other than a
multiemployer plan as defined in Section 4001(a)(3) of ERISA), and to which the
Borrower or any corporation, trade or business that is, along with the Borrower,
a member of a Controlled Group, may have liability, including any liability by
reason of having been a substantial employer within the meaning of Section 4063
of ERISA at any time during the preceding five years, or by reason of being
deemed to be a contributing sponsor under Section 4069 of ERISA.
     “Percentage” means, as the context may require, any Lender’s Revolving Loan
Percentage, Term A Percentage or Term B Percentage.
     “Permitted Acquisition” means an acquisition (whether pursuant to an
acquisition of a majority of the Capital Securities of a target or all or
substantially all of a target’s assets) by the Borrower or any Subsidiary from
any Person of a business in which the following conditions are satisfied:
     (a) the Borrower shall have delivered a certificate certifying that before
and after giving effect to such acquisition, the representations and warranties
set forth in each Loan Document shall, in each case, be true and correct in all
material respects with the same effect as if then made (unless stated to relate
solely to an earlier date, in which case such representations and warranties
shall be true and correct in all material respects as of such earlier date) and
no Default has occurred and is continuing or would result therefrom; and
     (b) the Borrower shall have delivered to the Administrative Agent a
Compliance Certificate for the period of four full Fiscal Quarters immediately
preceding such acquisition (prepared in good faith and in a manner and using
such methodology which is consistent with the most recent financial statements
delivered pursuant to Section 7.1.1) giving pro forma effect to the consummation
of such acquisition and evidencing compliance with the covenants set forth in
Section 7.2.4.
     “Permitted Additional Restricted Payment” means, for any Fiscal Year set
forth below, Restricted Payments made by the Borrower in the amount set forth
opposite such Fiscal Year:
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          Fiscal Year   Cash Amount
2006
  $ 20,000,000  
2007
  $ 25,000,000  
2008
  $ 30,000,000  
2009
  $ 35,000,000  
2010 and thereafter
  $ 40,000,000  

; provided, to the extent that the amount of Permitted Additional Restricted
Payments made by the Borrower during any Fiscal Year is less than the aggregate
amount permitted (including after giving effect to this proviso) for such Fiscal
Year, then such unutilized amount may be carried forward and utilized by the
Borrower to make Permitted Additional Restricted Payments in any succeeding
Fiscal Year and provided further that, to the extent (i) additional Capital
Securities are issued by the Borrower which result in the payment of Net Equity
Proceeds pursuant to Sections 3.1.1 and 3.1.2, the amounts set forth above shall
be increased by a percentage of such amounts equal to the percentage increase of
additional outstanding Capital Securities of the Borrower resulting from any
such issuance by the Borrower and (ii) for Fiscal Year 2009 and each Fiscal Year
thereafter, the amounts set forth above in such Fiscal Years shall be increased
(after giving effect to any increases permitted pursuant to preceding clause
(i)) by an additional $100,000,000 so long as both before and after giving
effect to such Restricted Payment, the Leverage Ratio is less than 3.00:1.00.
     “Permitted Cash Restructuring Charge Amount” means, $120,000,000 in the
aggregate for Fiscal Year 2006 and all Fiscal Years ending after the Closing
Date.
     “Permitted Cash Spin-Off Charge Amount” means, for any Fiscal Year set
forth below, the amount set forth opposite such Fiscal Year:

          Fiscal Year   Cash Amount
2006
  $ 20,000,000  
2007
  $ 55,000,000  

     “Permitted Liens” is defined in Section 7.2.3.
     “Permitted Securitization” means any Disposition by the Borrower or any of
its Subsidiaries consisting of Receivables and related collateral, credit
support and similar rights and any other assets that are customarily transferred
in a securitization of receivables, pursuant to one or more securitization
programs, to a Receivables Subsidiary or a Person who is not an Affiliate of the
Borrower; provided that (i) the consideration to be received by the Borrower and
its Subsidiaries other than a Receivables Subsidiary for any such Disposition
consists of cash, a promissory note or a customary contingent right to receive
cash in the nature of a “hold-back” or similar contingent right, (ii) no Default
shall have occurred and be continuing or would result therefrom, (iii) the
aggregate outstanding balance of the Indebtedness in respect of all such
programs at any point in time is not in excess of $250,000,000, and (iv) the Net
Receivables Proceeds from such Disposition are applied to the extent required
pursuant to Sections 3.1.1 and 3.1.2.
     “Person” means any natural person, corporation, limited liability company,
partnership, joint venture, association, trust or unincorporated organization,
Governmental Authority or any other legal entity, whether acting in an
individual, fiduciary or other capacity.
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     “Platform” is defined in clause (b) of Section 9.11.
     “Purchase Money Note” means a promissory note evidencing a line of credit,
or evidencing other Indebtedness owed to the Borrower or any Subsidiary in
connection with a Permitted Securitization, which note shall be repaid from cash
available to the maker of such note, other than amounts required to be
established as reserves, amounts paid to investors in respect of interest,
principal and other amounts owing to such investors and amounts paid in
connection with the purchase of newly generated accounts receivable.
     “Quarterly Payment Date” means the last day of March, June, September and
December, or, if any such day is not a Business Day, the next succeeding
Business Day.
     “Rate Protection Agreement” means, collectively, any agreement with respect
to Hedging Obligations entered into by the Borrower or any of its Subsidiaries
under which the counterparty of such agreement is (or at the time such agreement
was entered into, was) a Lender or an Affiliate of a Lender.
     “Receivable” shall mean a right to receive payment arising from a sale or
lease of goods or the performance of services by a Person pursuant to an
arrangement with another Person pursuant to which such other Person is obligated
to pay for good or services under terms that permit the purchase of such goods
and services on credit and shall include, in any event, any items of property
that would be classified as an “account,” “chattel paper,” “payment intangible”
or “instrument” under the UCC and any supporting obligations.
     “Receivables Subsidiary” shall mean any wholly owned Subsidiary of the
Borrower (or another Person in which the Borrower or any Subsidiary makes an
Investment and to which the Borrower or one or more of its Subsidiaries transfer
Receivables and related assets) which engages in no activities other than in
connection with the financing of Receivables and which is designated by the
Board of Directors of the applicable Subsidiary (as provided below) as a
Receivables Subsidiary and which meets the following conditions:
     (a) no portion of the Indebtedness or any other obligations (contingent or
otherwise) of such Subsidiary:
     (i) is guaranteed by the Borrower or any Subsidiary (that is not a
Receivables Subsidiary);
     (ii) is recourse to or obligates the Borrower or any Subsidiary (that is
not a Receivables Subsidiary); or
     (iii) subjects any property or assets of the Borrower or any Subsidiary
(that is not a Receivables Subsidiary), directly or indirectly, contingently or
otherwise, to the satisfaction thereof;
     (b) with which neither the Borrower nor any Subsidiary (that is not a
Receivables Subsidiary) has any material contract, agreement, arrangement or
understanding (other than Standard Securitization Undertakings); and
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     (c) to which neither the Borrower nor any Subsidiary (that is not a
Receivables Subsidiary) has any obligation to maintain or preserve such entity’s
financial condition or cause such entity to achieve certain levels of operating
results.
     Any such designation by the Board of Directors of the applicable Subsidiary
shall be evidenced by a certified copy of the resolution of the Board of
Directors of such Subsidiary giving effect to such designation and an officers
certificate certifying, to the best of such officer’s knowledge and belief, that
such designation complies with the foregoing conditions
     “Refunded Swing Line Loans” is defined in clause (b) of Section 2.3.2.
     “Register” is defined in clause (a) of Section 2.7.
     “Reimbursement Obligation” is defined in Section 2.6.3.
     “Release” means a “release”, as such term is defined in CERCLA.
     “Replacement Lender” is defined in Section 4.11.
     “Replacement Notice” is defined in Section 4.11.
     “Required Lenders” means, at any time, Non-Defaulting Lenders holding more
than 50% of the Total Exposure Amount of all Non-Defaulting Lenders.
     “Resource Conservation and Recovery Act” means the Resource Conservation
and Recovery Act, 42 U.S.C. Section 6901, et seq., as amended.
     “Restricted Payment” means (i) the declaration or payment of any dividend
(other than dividends payable solely in Capital Securities of the Borrower or
any Subsidiary) (other than a Receivables Subsidiary) on, or the making of any
payment or distribution on account of, or setting apart assets for a sinking or
other analogous fund for the purchase, redemption, defeasance, retirement or
other acquisition of, any class of Capital Securities of the Borrower or any
Subsidiary (other than a Receivables Subsidiary) or any warrants, options or
other right or obligation to purchase or acquire any such Capital Securities,
whether now or hereafter outstanding, or (ii) the making of any other
distribution in respect of such Capital Securities, in each case either directly
or indirectly, whether in cash, property or obligations of the Borrower or any
Subsidiary or otherwise.
     “Revaluation Date” means, with respect to any Credit Extension denominated
in Euros, each of the following: (i) in connection with the origination of any
new Credit Extension, the Business Day which is the earliest of the date such
credit is extended or the date the applicable rate is set; (ii) in connection
with any extension or conversion or continuation of an existing Loan, the
Business Day that is the earlier of the date such Loan is extended, converted or
continued, or the date the applicable rate is set; (iii) each date a Letter of
Credit is issued or renewed pursuant to Section 2.1.2 or amended in such a way
as to modify the Letter of Credit Outstandings or (iv) the date of any reduction
of any of the Revolving Commitment Amount, the Euro Loan Commitment Amount or
the Letter of Credit Commitment Amount pursuant to the
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terms of Section 2.2. For purposes of determining availability hereunder, the
rate of exchange for Euros shall be the Spot Rate.
     “Revolving Exposure” means, relative to any Revolving Loan Lender, at any
time, (i) the Dollar Equivalent of the aggregate outstanding principal amount of
all Revolving Loans of such Lender at such time, plus (ii) such Lender’s
Revolving Loan Percentage of the Dollar Equivalent of the Letter of Credit
Outstandings, plus (iii) such Lender’s Revolving Loan Percentage of the
aggregate principal amount outstanding of all Swing Line Loans at such time.
     “Revolving Loan Commitment” means, relative to any Lender, such Lender’s
obligation (if any) to make Revolving Loans pursuant to clause (a) of
Section 2.1.1.
     “Revolving Loan Commitment Amount” means, on any date, $500,000,000, as
such amount may be reduced from time to time pursuant to Section 2.2.
     “Revolving Loan Commitment Termination Date” means the earliest of
     (a) October 15, 2006 (if the initial Credit Extension has not occurred on
or prior to such date);
     (b) the fifth anniversary of the Closing Date;
     (c) the date on which the Revolving Loan Commitment Amount is terminated in
full or reduced to zero pursuant to the terms of this Agreement; and
     (d) the date on which any Commitment Termination Event occurs.
Upon the occurrence of any event described in the preceding clauses (c) or (d),
the Revolving Loan Commitments shall terminate automatically and without any
further action.
     “Revolving Loan Lender” is defined in clause (a) of Section 2.1.1.
     “Revolving Loans” is defined in clause (a) of Section 2.1.1.
     “Revolving Note” means a promissory note of the Borrower payable to any
Revolving Loan Lender, in the form of Exhibit A-1 hereto (as such promissory
note may be amended, endorsed or otherwise modified from time to time),
evidencing the aggregate Indebtedness of the Borrower to such Revolving Loan
Lender resulting from outstanding Revolving Loans, and also means all other
promissory notes accepted from time to time in substitution therefor or renewal
thereof.
     “Revolving Loan Percentage” means, relative to any Lender, the applicable
percentage relating to Revolving Loans set forth opposite its name on
Schedule II hereto under the Revolving Loan Commitment column or set forth in a
Lender Assignment Agreement under the Revolving Loan Commitment column, as such
percentage may be adjusted from time to time pursuant to Lender Assignment
Agreements executed by such Lender and its assignee Lender and delivered
pursuant to Section 10.11. A Lender shall not have any Revolving Loan Commitment
if its percentage under the Revolving Loan Commitment column is zero.
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     “S&P” means Standard & Poor’s Rating Services, a division of The
McGraw-Hill Companies, Inc. and its successors.
     “Sara Lee” is defined in the first recital.
     “SEC” means the Securities and Exchange Commission.
     “Second Lien Administrative Agent” means the “Administrative Agent”
pursuant to, and as defined in, the Second Lien Loan Documents, and any
successor thereto.
     “Second Lien Collateral Agent” means the “Collateral Agent” pursuant to,
and as defined in, the Second Lien Loan Documents, and any successor thereto.
     “Second Lien Credit Agreement” means the Second Lien Credit Agreement,
dated as of the Closing Date, among the IP Subsidiary, the lenders from time to
time party thereto and the Second Lien Administrative Agent, as the same may be
amended, supplemented, amended and restated or otherwise modified from time to
time in accordance with this Agreement.
     “Second Lien Loan Documents” means the Second Lien Credit Agreement and the
related guarantees, pledge agreements, security agreements, mortgages, notes and
other agreements and instruments entered into in connection with the Second Lien
Credit Agreement, in each case as the same may be amended, supplemented, amended
and restated or otherwise modified from time to time in accordance with this
Agreement.
     “Second Lien Loans” is defined in the second recital.
     “Secured Parties” means, collectively, the Lenders, the Issuers, the
Administrative Agent, the Collateral Agent, the Lead Arrangers, each Foreign
Working Capital Lender (if applicable), each counterparty to a Rate Protection
Agreement that is (or at the time such Rate Protection Agreement was entered
into, was) a Lender or an Affiliate thereof and (in each case), each Person to
whom an Obligor owes Cash Management Obligations, each of their respective
successors, transferees and assigns.
     “Security Agreement” means the Pledge and Security Agreement executed and
delivered by each Obligor, substantially in the form of Exhibit G hereto,
together with any supplemental Foreign Pledge Agreements delivered pursuant to
the terms of this Agreement, in each case as amended, supplemented, amended and
restated or otherwise modified from time to time.
     “Senior Note Documents” means the Senior Notes, the Senior Note Indenture
and all other agreements, documents and instruments executed and delivered with
respect to the Senior Notes or the Senior Note Indenture, as the same may be
amended, supplemented, amended and restated or otherwise modified from time to
time in accordance with this Agreement.
     “Senior Note Indenture” means the Indenture, between the Borrower and the
Person acting as trustee thereunder (the “Senior Notes Trustee”), pursuant to
which the Senior Notes and any supplemental issuance of “senior notes”
thereunder are issued, as the same may be amended, supplemented, amended and
restated or otherwise modified from time to time in accordance with this
Agreement.
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     “Senior Notes” is defined in the second recital.
     “Senior Notes Trustee” is defined in the definition of “Senior Note
Indenture”.
     “Solvent” means, with respect to any Person and its Subsidiaries on a
particular date, that on such date (i) the fair value of the property (on a
going-concern basis) of such Person and its Subsidiaries on a consolidated basis
is greater than the total amount of liabilities, including contingent
liabilities, of such Person and its Subsidiaries on a consolidated basis,
(ii) the present fair salable value of the assets (on a going-concern basis) of
such Person and its Subsidiaries on a consolidated basis is not less than the
amount that will be required to pay the probable liability of such Person and
its Subsidiaries on a consolidated basis on its debts as they become absolute
and matured in the ordinary course of business, (iii) such Person does not
intend to, and does not believe that it or its Subsidiaries will, incur debts or
liabilities beyond the ability of such Person and its Subsidiaries to pay as
such debts and liabilities mature in the ordinary course of business (including
through refinancings, asset sales and other capital market transactions), and
(iv) such Person and its Subsidiaries on a consolidated basis is not engaged in
business or a transaction, and such Person and its Subsidiaries on a
consolidated basis is not about to engage in a business or a transaction, for
which the property of such Person and its Subsidiaries on a consolidated basis
would constitute an unreasonably small capital. The amount of Contingent
Liabilities at any time shall be computed as the amount that, in light of all
the facts and circumstances existing at such time, can reasonably be expected to
become an actual or matured liability.
     “Specified Default” means (i) any Default under Section 8.1.1 or Section
8.1.9 or (ii) any other Event of Default.
     “Spin-Off” is defined in the first recital.
     “Spot Rate” means the rate determined by the 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. (in the
applicable time zone) on the date two Business Days prior to the date as of
which the foreign exchange computation is made; provided that the Administrative
Agent may obtain such spot rate from another financial institution designated by
the 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.
     “Standby Letter of Credit” means any Letter of Credit other than a
Commercial Letter of Credit.
     “Standard Securitization Undertakings” shall mean representations,
warranties, covenants and indemnities entered into by the Borrower or any
Subsidiary which are reasonably customary in a securitization of Receivables.
     “Stated Amount” means, on any date and with respect to a particular Letter
of Credit, the total amount then available to be drawn under such Letter of
Credit.
     “Stated Expiry Date” is defined in Section 2.6.
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     “Stated Maturity Date” means (i) with respect to all Term A Loans, the
sixth anniversary of the Closing Date, (ii) with respect to all Term B Loans,
the seventh anniversary of the Closing Date, and (iii) with respect to all
Revolving Loans, Euro Loans and Swing Line Loans, the fifth anniversary of the
Closing Date.
     “Subsidiary” means, with respect to any Person, any other Person of which
more than 50% of the outstanding Voting Securities of such other Person
(irrespective of whether at the time Capital Securities of any other class or
classes of such other Person shall or might have voting power upon the
occurrence of any contingency) is at the time directly or indirectly owned or
controlled by such Person, by such Person and one or more other Subsidiaries of
such Person, or by one or more other Subsidiaries of such Person. Unless the
context otherwise specifically requires, the term “Subsidiary” shall be a
reference to a Subsidiary of the Borrower (other than a Receivables Subsidiary).
No Foreign Supply Chain Entity shall be considered to be a Subsidiary of the
Borrower or any Subsidiary for purposes hereof except as set forth in the
definition of Foreign Supply Chain Entity. Further, the European TM SPV shall
not be considered to be a Subsidiary for any purpose hereunder.
     “Subsidiary Guarantor” means each U.S. Subsidiary that has executed and
delivered to the Administrative Agent the Guaranty (including by means of a
delivery of a supplement thereto).
     “Swing Line Lender” means, subject to the terms of this Agreement, Citicorp
USA.
     “Swing Line Loan Commitment” is defined in clause (b) of Section 2.1.1.
     “Swing Line Loan Commitment Amount” means, on any date, $50,000,000, as
such amount may be reduced from time to time pursuant to Section 2.2.
     “Swing Line Loans” is defined in clause (b) of Section 2.1.1.
     “Swing Line Note” means a promissory note of the Borrower payable to the
Swing Line Lender, in the form of Exhibit A-4 hereto (as such promissory note
may be amended, restated, endorsed or otherwise modified from time to time),
evidencing the aggregate Indebtedness of the Borrower to the Swing Line Lender
resulting from outstanding Swing Line Loans, and also means all other promissory
notes accepted from time to time in substitution therefor or renewal thereof.
     “Syndication Agents” is defined in the preamble.
     “Syndication Date” means the date upon which the Lead Arrangers determine
in their sole discretion (and notify the Borrower) and in accordance with the
terms of the Fee Letter that a Successful Syndication (as defined in the Fee
Letter) (and the resultant addition of Persons as Lenders pursuant to
Section 10.11) has been completed.
     “Synthetic Lease” means, as applied to any Person, any lease (including
leases that may be terminated by the lessee at any time) of any property
(whether real, personal or mixed) (i) that is not a capital lease in accordance
with GAAP and (ii) in respect of which the lessee retains or
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obtains ownership of the property so leased for federal income tax purposes,
other than any such lease under which that Person is the lessor.
     “Taxes” means all income, stamp or other taxes, duties, levies, imposts,
charges, assessments, fees, deductions or withholdings, now or hereafter
imposed, levied, collected, withheld or assessed by any Governmental Authority,
and all interest, penalties or similar liabilities with respect thereto.
     “Term A Loan Commitment” means, relative to any Lender, such Lender’s
obligation (if any) to make Term A Loans pursuant to clause (a) of
Section 2.1.3.
     “Term A Loan Commitment Amount” means, on any date, $250,000,000.
     “Term A Loan Commitment Termination Date” means the earliest of
     (a) October 15, 2006 (if the Term A Loans have not been made on or prior to
such date);
     (b) the Closing Date (immediately after the making of the Term A Loans on
such date); and
     (c) the date on which any Commitment Termination Event occurs.
Upon the occurrence of any event described above, the Term A Loan Commitments
shall terminate automatically and without any further action.
     “Term A Loans” is defined in clause (a) of Section 2.1.3.
     “Term A Note” means a promissory note of the Borrower payable to any
Lender, in the form of Exhibit A-2 hereto (as such promissory note may be
amended, endorsed or otherwise modified from time to time), evidencing the
aggregate Indebtedness of the Borrower to such Lender resulting from outstanding
Term A Loans, and also means all other promissory notes accepted from time to
time in substitution therefor or renewal thereof.
     “Term A Percentage” means, relative to any Lender, the applicable
percentage relating to Term A Loans set forth opposite its name on Schedule II
hereto under the Term A Loan Commitment column or set forth in a Lender
Assignment Agreement under the Term A Loan Commitment column, as such percentage
may be adjusted from time to time pursuant to Lender Assignment Agreements
executed by such Lender and its assignee Lender and delivered pursuant to
Section 10.11. A Lender shall not have any Term A Loan Commitment if its
percentage under the Term A Loan Commitment column is zero.
     “Term B Loan Commitment” means, relative to any Lender, such Lender’s
obligation (if any) to make Term B Loans pursuant to clause (b) of
Section 2.1.3.
     “Term B Loan Commitment Amount” means, on any date, $1,400,000,000.
     “Term B Loan Commitment Termination Date” means the earliest of
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     (a) October 15, 2006 (if the Term B Loans have not been made on or prior to
such date); and
     (b) the Closing Date (immediately after the making of the Term B Loans on
such date); and
     (c) the date on which any Commitment Termination Event occurs.
Upon the occurrence of any event described above, the Term B Loan Commitments
shall terminate automatically and without any further action.
     “Term B Loans” is defined in clause (b) of Section 2.1.3.
     “Term B Note” means a promissory note of the Borrower payable to any
Lender, in the form of Exhibit A-3 hereto (as such promissory note may be
amended, endorsed or otherwise modified from time to time), evidencing the
aggregate Indebtedness of the Borrower to such Lender resulting from outstanding
Term B Loans, and also means all other promissory notes accepted from time to
time in substitution therefor or renewal thereof.
     “Term B Percentage” means, relative to any Lender, the applicable
percentage relating to Term B Loans set forth opposite its name on Schedule II
hereto under the Term B Loan Commitment column or set forth in a Lender
Assignment Agreement under the Term B Loan Commitment column, as such percentage
may be adjusted from time to time pursuant to Lender Assignment Agreements
executed by such Lender and its assignee Lender and delivered pursuant to
Section 10.11. A Lender shall not have any Term B Loan Commitment if its
percentage under the Term B Loan Commitment column is zero.
     “Term Loans” means, collectively, the Term A Loans and the Term B Loans.
     “Termination Date” means the date on which all Obligations have been paid
in full in cash (other than contingent indemnification obligations for which no
claim has been asserted), all Letters of Credit have been terminated or expired
(or been Cash Collateralized), all Rate Protection Agreements have been
terminated and all Commitments shall have terminated.
     “Total Debt” means, on any date, the outstanding principal amount of all
Indebtedness of the Borrower and its Subsidiaries (other than a Receivables
Subsidiary) of the type referred to in clause (i) of the definition of
“Indebtedness” (which, in the case of the Loans, shall be deemed to equal the
Dollar Equivalent (determined as of the most recent Revaluation Date) for any
Loans denominated in Euros), clause (ii) of the definition of “Indebtedness”
(which, in the case of Letter of Credit Outstandings, shall be deemed to equal
the Dollar Equivalent (determined as of the most recent Revaluation Date) for
any Letter of Credit Outstandings denominated in Euros), clause (iii) of the
definition of “Indebtedness” and clause (vii) of the definition of
“Indebtedness”, in each case exclusive of intercompany Indebtedness between the
Borrower and its Subsidiaries and any Contingent Liability in respect of any of
the foregoing.
     “Total Exposure Amount” means, on any date of determination (and without
duplication), the Dollar Equivalent (determined as of the most recent
Revaluation Date) of the
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outstanding principal amount of all Loans, the aggregate amount of all Letter of
Credit Outstandings and the unfunded amount of the Commitments.
     “Total Revolving Loan Exposure Amount” means, on any date of determination
(and without duplication), the Dollar Equivalent (determined as of the most
recent Revaluation Date) of the outstanding principal amount of all Revolving
Loans, the aggregate amount of all Letter of Credit Outstandings and the
unfunded amount of the Revolving Loan Commitments.
     “Trademark Security Agreement” means any Trademark Security Agreement
executed and delivered by any Obligor substantially in the form of Exhibit B to
the Security Agreement, as amended, supplemented, amended and restated or
otherwise modified from time to time.
     “Transaction” means, collectively, (i) the consummation of the Spin-Off,
(ii) the issuance of the Dividend, (iii) the consummation of the IP Purchase,
(iv) the entering into of the Loan Documents (other than this Agreement) and the
making of the Loans hereunder on the Closing Date, (v) the entering into of the
Second Lien Loan Documents and the making of the Second Lien Loans, (vi) the
receipt by the Borrower of the proceeds from the Bridge Loans and the entering
into of the Bridge Loan Documents and/or the issuance of the Senior Notes in an
aggregate amount of $500,000,000, and (vii) the payment of fees and expenses in
connection and in accordance with the foregoing.
     “Transaction Documents” means, collectively, the Second Lien Loan
Documents, the Bridge Loan Documents, the Senior Note Documents and any other
material document executed or delivered in connection with the Transaction,
including any transition services agreements and tax sharing agreements, in each
case as amended, supplemented, amended and restated or otherwise modified from
time to time in accordance with Section 7.2.12.
     “Treaty on European Union” means the Treaty of Rome of March 25, 1957, as
amended by the Single European Act 1986 and the Maastricht Treaty (which was
signed at Maastricht, the Kingdom of Netherlands, on February 1, 1992 and came
into force on November 1, 1993), as amended from time to time.
     “type” means, relative to any Loan, the portion thereof, if any, being
maintained as a Base Rate Loan or a LIBO Rate Loan.
     “UCC” means the Uniform Commercial Code as in effect from time to time in
the State of New York; provided that if, with respect to any Filing Statement or
by reason of any provisions of law, the perfection or the effect of perfection
or non-perfection of the security interests granted to the Collateral Agent
pursuant to the applicable Loan Document is governed by the Uniform Commercial
Code as in effect in a jurisdiction of the United States other than New York,
then “UCC” means the Uniform Commercial Code as in effect from time to time in
such other jurisdiction for purposes of the provisions of each Loan Document and
any Filing Statement relating to such perfection or effect of perfection or
non-perfection.
     “United States” or “U.S.” means the United States of America, its fifty
states and the District of Columbia.
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     “U.S. Subsidiary” means any Subsidiary (other than a Receivables
Subsidiary) that is incorporated or organized under the laws of the United
States.
     “Voting Securities” means, with respect to any Person, Capital Securities
of any class or kind ordinarily having the power to vote for the election of
directors, managers or other voting members of the governing body of such
Person.
     “Welfare Plan” means a “welfare plan”, as such term is defined in
Section 3(1) of ERISA.
     “wholly owned Subsidiary” means any Subsidiary all of the outstanding
Capital Securities of which (other than any director’s qualifying shares or
investments by foreign nationals mandated by applicable laws) is owned directly
or indirectly by the Borrower.
     SECTION 1.2 Use of Defined Terms. Unless otherwise defined or the context
otherwise requires, terms for which meanings are provided in this Agreement
shall have such meanings when used in each other Loan Document and the
Disclosure Schedule.
     SECTION 1.3 Cross-References. Unless otherwise specified, references in a
Loan Document to any Article or Section are references to such Article or
Section of such Loan Document, and references in any Article, Section or
definition to any clause are references to such clause of such Article, Section
or definition.
     SECTION 1.4 Accounting and Financial Determinations. (a) Unless otherwise
specified, all accounting terms used in each Loan Document shall be interpreted,
and all accounting determinations and computations thereunder (including under
Section 7.2.4 and the definitions used in such calculations) shall be made, in
accordance with those generally accepted accounting principles (“GAAP”) applied
in the preparation of the financial statements referred to in clause (a) of
Section 5.1.6. Unless otherwise expressly provided, all financial covenants and
defined financial terms shall be computed on a consolidated basis for the
Borrower and its Subsidiaries, in each case without duplication.
          (b) As of any date of determination, for purposes of determining the
Interest Coverage Ratio or Leverage Ratio (and any financial calculations
required to be made or included within such ratios, or required for purposes of
preparing any Compliance Certificate to be delivered pursuant to the definition
of “Permitted Acquisition”), the calculation of such ratios and other financial
calculations shall include or exclude, as the case may be, the effect of any
assets or businesses that have been acquired or Disposed of by the Borrower or
any of its Subsidiaries pursuant to the terms hereof (including through mergers
or consolidations) as of such date of determination, as determined by the
Borrower on a pro forma basis in accordance with GAAP, which determination may
include one-time adjustments or reductions in costs, if any, directly
attributable to any such permitted Disposition or Permitted Acquisition, as the
case may be, in each case (i) calculated in accordance with Regulation S-X of
the Securities Act of 1933, as amended from time to time, and any successor
statute, for the period of four Fiscal Quarters ended on or immediately prior to
the date of determination of any such ratios (without giving effect to any
cost-savings or adjustments relating to synergies resulting from a Permitted
Acquisition except as permitted by Regulation S-X of the Securities Act of 1933
or otherwise as
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the Administrative Agent shall otherwise agree) and (ii) giving effect to any
such Permitted Acquisition or permitted Disposition as if it had occurred on the
first day of such four Fiscal Quarter period.
     SECTION 1.5 Exchange Rates; Currency Equivalents. The Administrative Agent
shall determine the Spot Rates as of each Revaluation Date to be used for
calculating the Dollar Equivalent of Credit Extensions and amounts outstanding
hereunder denominated in Euros. Such Spot Rates shall become effective as of
such Revaluation Date and shall be the Spot Rates employed in converting any
amounts between the applicable currencies until the next Revaluation Date to
occur. Except for purposes of financial statements delivered by the Borrower
hereunder or calculating financial covenants hereunder or except as otherwise
expressly provided herein, the applicable amount of any Currency for purposes of
the Loan Documents shall be such Dollar Equivalent as so reasonably determined
by the Administrative Agent. Wherever in this Agreement in connection with a
Credit Extension, conversion, continuation or prepayment of a Loan, an amount,
such as a required minimum or multiple amount, is expressed in Dollars, but such
Credit Extension is denominated in Euros, such amount shall be the Euro
Equivalent of such Dollars, as reasonably determined by the Administrative
Agent.
     SECTION 1.6 Computation of Dollar Amounts. References herein to minimum
Dollar amounts and integral multiples stated in Dollars, where they shall also
be applicable to Euros, shall be deemed to refer to the approximate Euro
Equivalent.
ARTICLE II
COMMITMENTS, BORROWING AND ISSUANCE
PROCEDURES, NOTES AND LETTERS OF CREDIT
     SECTION 2.1 Commitments. On the terms and subject to the conditions of this
Agreement, the Lenders and the Issuers severally agree to make Credit Extensions
as set forth below.
     SECTION 2.1.1 Revolving Loan Commitment and Swing Line Loan Commitment.
From time to time on any Business Day occurring after the Closing Date but prior
to the Revolving Loan Commitment Termination Date,
     (a) each Lender that has a Revolving Loan Commitment (referred to as a
“Revolving Loan Lender”), agrees that it will make loans (relative to such
Lender, its “Revolving Loans”) to the Borrower denominated in Dollars or in
Euros, in each case equal to such Lender’s Revolving Loan Percentage of the
Dollar Equivalent (determined as of the most recent Revaluation Date) of the
aggregate amount of each Borrowing of the Revolving Loans requested by the
Borrower to be made on such day; and
     (b) the Swing Line Lender agrees that it will make loans (its “Swing Line
Loans”) denominated in Dollars to the Borrower equal to the principal amount of
the Swing Line Loan requested by the Borrower to be made on such day. The
commitment of the Swing Line Lender described in this clause is herein referred
to as its “Swing Line Loan Commitment”.
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On the terms and subject to the conditions hereof, the Borrower may from time to
time borrow, prepay and reborrow Revolving Loans and Swing Line Loans. No
Revolving Loan Lender shall be permitted or required to make any Revolving Loan
if, after giving effect thereto, (i) the Dollar Equivalent of such Lender’s
Revolving Exposure would exceed such Lender’s Revolving Loan Percentage of the
then existing Revolving Loan Commitment Amount, (ii) the Dollar Equivalent of
the aggregate principal amount of Euro Loans, together with the Dollar
Equivalent of Letters of Credit Outstandings, would exceed the Euro Loan
Commitment Amount, or (iii) the Dollar Equivalent of the aggregate amount of
Revolving Loans and Swing Line Loans outstanding together with the Dollar
Equivalent of Letters of Credit Outstandings would exceed the Revolving Loan
Commitment Amount. Furthermore, the Swing Line Lender shall not be permitted or
required to make Swing Line Loans if, after giving effect thereto, (A) the
aggregate outstanding principal amount of all Swing Line Loans would exceed the
then existing Swing Line Loan Commitment Amount or (B) the sum of the aggregate
amount of all Swing Line Loans and the Dollar Equivalent of all Revolving Loans
outstanding plus the Dollar Equivalent of the aggregate amount of Letter of
Credit Outstandings would exceed the Revolving Loan Commitment Amount.
     SECTION 2.1.2 Letter of Credit Commitment. From time to time on any
Business Day occurring after the Closing Date but five Business Days prior to
the Revolving Loan Commitment Termination Date, the relevant Issuer agrees that
it will (subject to the terms hereof) (i) issue one or more Letters of Credit in
Dollars or in Euros for the account of the Borrower, any Subsidiary Guarantor or
any Foreign Subsidiary in the Stated Amount requested by the Borrower on such
day, or (ii) extend the Stated Expiry Date of a Letter of Credit previously
issued hereunder. No Issuer shall be permitted or required to issue any Letter
of Credit if, after giving effect thereto, (A) the Dollar Equivalent (reasonably
determined as of the most recent Revaluation Date) of the aggregate amount of
all Letter of Credit Outstandings would exceed the then existing Letter of
Credit Commitment Amount or (B) the sum of the aggregate amount of all Letter of
Credit Outstandings plus the aggregate principal amount of all Revolving Loans
and Swing Line Loans then outstanding would exceed the then existing Revolving
Loan Commitment Amount.
     SECTION 2.1.3 Term Loan Commitments. In a single Borrowing (which shall be
a Business Day) occurring on or prior to the applicable Commitment Termination
Date, each Lender that has a Term A Loan Commitment or a Term B Loan Commitment,
as applicable, agrees that it will
     (a) make loans (relative to such Lender, its “Term A Loans”) to the
Borrower denominated in Dollars equal to such Lender’s Term A Percentage of the
aggregate amount of the Borrowing of Term A Loans requested by the Borrower to
be made on such day; and
     (b) make loans (relative to such Lender, its “Term B Loans”) to the
Borrower denominated in Dollars equal to such Lender’s Term B Percentage of the
aggregate amount of the Borrowing of Term B Loans requested by the Borrower to
be made on such day.
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No Lender shall be permitted or required to make any Term Loan if, after giving
effect thereto, the aggregate outstanding principal amount of all Term A Loans
or all Term B Loans (as the case may be) (i) of all Lenders made on the Closing
Date would exceed the Term A Loan Commitment Amount (in the case of Term A
Loans) or the Term B Loan Commitment Amount (in the case of Term B Loans) or
(ii) of such Lender with a Term A Loan Commitment or with a Term B Loan
Commitment, as applicable, made on the Closing Date would exceed such Lender’s
Percentage of the Term A Loan Commitment Amount (in the case of Term A Loans) or
the Term B Loan Commitment Amount (in the case of Term B Loans). No amounts paid
or prepaid with respect to Term Loans may be reborrowed.
     SECTION 2.2 Reduction of the Commitment Amounts. The Commitment Amounts are
subject to reduction from time to time as set forth below.
     SECTION 2.2.1 Optional. The Borrower may, from time to time on any Business
Day occurring after the Closing Date, voluntarily reduce any Commitment Amount
on the Business Day so specified by the Borrower; provided that, all such
reductions shall require at least one Business Day’s prior notice to the
Administrative Agent and be permanent, and any partial reduction of any
Commitment Amount shall be in a minimum amount of $1,000,000 and in an integral
multiple of $500,000. Any optional or mandatory reduction of the Revolving Loan
Commitment Amount pursuant to the terms of this Agreement which reduces the
Revolving Loan Commitment Amount below the sum of (i) the Swing Line Loan
Commitment Amount, (ii) the Euro Loan Commitment Amount and (iii) the Letter of
Credit Commitment Amount shall result in an automatic and corresponding
reduction of the Swing Line Loan Commitment Amount, Euro Loan Commitment Amount
and/or Letter of Credit Commitment Amount (as directed by the Borrower in a
notice to the Administrative Agent delivered together with the notice of such
voluntary reduction in the Revolving Loan Commitment Amount) to an aggregate
amount not in excess of the Revolving Loan Commitment Amount, as so reduced,
without any further action on the part of the Swing Line Lender, any Revolving
Loan Lender or any Issuer.
     SECTION 2.2.2 Mandatory. Following the prepayment in full of the Term
Loans, the Revolving Loan Commitment Amount shall, without any further action,
automatically and permanently be reduced on the date the Term Loans would
otherwise have been required to be prepaid with any Excess Cash Flow, Net Equity
Proceeds, Net Disposition Proceeds or Net Casualty Proceeds, in each case in an
amount equal to the amount by which the Term Loans would otherwise be required
to be prepaid if Term Loans had been outstanding.
     SECTION 2.3 Borrowing Procedures. Loans (other than Swing Line Loans) shall
be made by the Lenders in accordance with Section 2.3.1, and Swing Line Loans
shall be made by the Swing Line Lender in accordance with Section 2.3.2.
     SECTION 2.3.1 Borrowing Procedure. In the case of Loans (other than Swing
Line Loans), by delivering a Borrowing Request to the Administrative Agent on or
before 10:00 a.m. on a Business Day, the Borrower may from time to time
irrevocably request, on such Business Day in the case of Base Rate Loans, on not
less than three Business Days’ notice and not more than five Business Days’
notice, in the case of LIBO Rate Loans denominated in Dollars, or on no less
than four Business Days’ and no more than ten Business Days’ notice in the case
of Euro Loans, that a Borrowing be made, in the case of LIBO Rate Loans, in a
minimum amount of
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$5,000,000 (or the Euro Equivalent thereof) and an integral multiple of
$1,000,000 (or the Euros Equivalent thereof), in the case of Base Rate Loans, in
a minimum amount of $1,000,000 and an integral multiple of $500,000 or, in
either case, in the unused amount of the applicable Commitment; provided that
only Base Rate Loans and LIBO Rate Loans with a one month Interest Period may be
incurred prior to the earlier to occur of (a) the 30th day following the Closing
Date and (b) the date upon which the Lead Arrangers have determined that the
Syndication Date has occurred. On the terms and subject to the conditions of
this Agreement, each Borrowing shall be comprised of the type of Loans, and
shall be made on the Business Day and in the Currency specified in such
Borrowing Request. In the case of other than Swing Line Loans, on or before
12:00 noon on such Business Day each Lender that has a Commitment to make the
Loans being requested shall deposit with the Administrative Agent same day funds
in an amount equal to such Lender’s Percentage of the requested Borrowing. Such
deposit will be made to an account which the Administrative Agent shall specify
from time to time by notice to the Lenders. To the extent funds are received
from the Lenders, the Administrative Agent shall make such funds available to
the Borrower by wire transfer to the accounts the Borrower shall have specified
in its Borrowing Request. No Lender’s obligation to make any Loan shall be
affected by any other Lender’s failure to make any Loan.
     SECTION 2.3.2 Swing Line Loans; Participations, etc. (a) By telephonic
notice to the Swing Line Lender on or before 2 p.m. on a Business Day (followed
(within one Business Day) by the delivery of a confirming Borrowing Request),
the Borrower may from time to time irrevocably request that Swing Line Loans be
made by the Swing Line Lender in an aggregate minimum principal amount of
$500,000 and an integral multiple of $100,000. All Swing Line Loans shall be
made as Base Rate Loans and shall not be entitled to be converted into LIBO Rate
Loans. The proceeds of each Swing Line Loan shall be made available by the Swing
Line Lender to the Borrower by wire transfer to the account the Borrower shall
have specified in its notice therefor by the close of business on the Business
Day telephonic notice is received by the Swing Line Lender. Upon the making of
each Swing Line Loan, and without further action on the part of the Swing Line
Lender or any other Person, each Revolving Loan Lender (other than the Swing
Line Lender) shall be deemed to have irrevocably purchased, to the extent of its
Revolving Loan Percentage, a participation interest in such Swing Line Loan, and
such Revolving Loan Lender shall, to the extent of its Revolving Loan
Percentage, be responsible for reimbursing within one Business Day the Swing
Line Lender for Swing Line Loans which have not been reimbursed by the Borrower
in accordance with the terms of this Agreement.
     (b) If (i) any Swing Line Loan shall be outstanding for more than four
Business Days, (ii) any Swing Line Loan is or will be outstanding on a date when
the Borrower requests that a Revolving Loan be made, or (iii) any Default shall
occur and be continuing, then each Revolving Loan Lender (other than the Swing
Line Lender) irrevocably agrees that it will, at the request of the Swing Line
Lender, make a Revolving Loan (which shall initially be funded as a Base Rate
Loan) in an amount equal to such Lender’s Revolving Loan Percentage of the
aggregate principal amount of all such Swing Line Loans then outstanding (such
outstanding Swing Line Loans hereinafter referred to as the “Refunded Swing Line
Loans”). On or before 11:00 a.m. on the first Business Day following receipt by
each Revolving Loan Lender of a request to make Revolving Loans as provided in
the preceding sentence, each Revolving Loan Lender shall deposit in an account
specified by the Swing Line Lender the amount so requested in same day funds and
such funds shall be applied by the Swing Line Lender to repay the Refunded Swing
Line Loans. At the time the Revolving Loan Lenders make the above referenced
Revolving Loans the Swing Line Lender shall be deemed to have made, in
consideration of the making of the Refunded Swing Line Loans, Revolving Loans in
an amount equal to the Swing Line Lender’s Revolving Loan Percentage of the
aggregate principal amount of the Refunded Swing
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Line Loans. Upon the making (or deemed making, in the case of the Swing Line
Lender) of any Revolving Loans pursuant to this clause, the amount so funded
shall become an outstanding Revolving Loan and shall no longer be owed as a
Swing Line Loan. All interest payable with respect to any Revolving Loans made
(or deemed made, in the case of the Swing Line Lender) pursuant to this clause
shall be appropriately adjusted to reflect the period of time during which the
Swing Line Lender had outstanding Swing Line Loans in respect of which such
Revolving Loans were made. Each Revolving Loan Lender’s obligation to make the
Revolving Loans referred to in this clause shall be absolute and unconditional
and shall not be affected by any circumstance, including (i) any set-off,
counterclaim, recoupment, defense or other right which such Lender may have
against the Swing Line Lender, any Obligor or any Person for any reason
whatsoever; (ii) the occurrence or continuance of any Default; (iii) any adverse
change in the condition (financial or otherwise) of any Obligor; (iv) the
acceleration or maturity of any Obligations or the termination of any Commitment
after the making of any Swing Line Loan; (v) any breach of any Loan Document by
any Person; or (vi) any other circumstance, happening or event whatsoever,
whether or not similar to any of the foregoing.
     SECTION 2.4 Continuation and Conversion Elections. By delivering a
Continuation/Conversion Notice to the Administrative Agent on or before
10:00 a.m. on a Business Day, the Borrower may from time to time irrevocably
elect:
     (a) on not less than three nor more than five Business Days’ notice, (i) to
convert any Base Rate Loan into one or more LIBO Rate Loans denominated in
Dollars or (ii) before the last day of the then current Interest Period with
respect thereto, to continue any LIBO Rate Loan denominated in Dollars as a LIBO
Rate Loan so denominated; and
     (b) on not less than five nor more than ten Business Days’ notice before
the last day of the then current Interest Period with respect thereto, to
convert or continue any LIBO Rate Loan denominated in Euros as a LIBO Rate Loan
denominated in Euros.
provided that (i) any portion of any Loan which is continued or converted
hereunder shall be in a minimum amount of $1,000,000 and in an integral multiple
amount of $1,000,000 and (ii) in the absence of prior notice as required above
(which notice may be delivered telephonically followed by written confirmation
within 24 hours thereafter by delivery of a Continuation/Conversion Notice),
with respect to any LIBO Rate Loan denominated in Dollars at least three
Business Days (or, with respect to any LIBO Rate Loan denominated in Euros, at
least five Business Days) before the last day of the then current Interest
Period with respect thereto, such LIBO Rate Loan shall, on such last day,
automatically convert to a Base Rate Loan; provided further that (A) each such
conversion or continuation shall be pro rated among the applicable outstanding
Loans of all Lenders that have made such Loans, and (B) no portion of the
outstanding principal amount of any Loans may be continued as, or be converted
into, LIBO Rate Loans when any Event of Default has occurred and is continuing.
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     SECTION 2.5 Funding. Each Lender may, if it so elects, fulfill its
obligation to make, continue or convert LIBO Rate Loans hereunder by causing one
of its foreign branches or Affiliates (or an international banking facility
created by such Lender) to make or maintain such LIBO Rate Loan; provided that,
such LIBO Rate Loan shall nonetheless be deemed to have been made and to be held
by such Lender, and the obligation of the Borrower to repay such LIBO Rate Loan
shall nevertheless be to such Lender for the account of such foreign branch,
Affiliate or international banking facility. Subject to Section 4.10, each
Lender may, at its option, make any Loan available to the Borrower by causing
any foreign or domestic branch or Affiliate of such Lender to make such Loan;
provided that any exercise of such option shall not affect the obligation of the
Borrower to repay Loans in accordance with the terms of this Agreement.
     SECTION 2.6 Issuance Procedures. By delivering to the Administrative Agent
and the relevant Issuer an Issuance Request on or before 10:00 a.m. on a
Business Day, the Borrower may from time to time irrevocably request on not less
than three nor more than ten Business Days’ notice, in the case of an initial
issuance of a Letter of Credit and not less than three Business Days’ prior
notice, in the case of a request for the extension of the Stated Expiry Date of
a Standby Letter of Credit (in each case, unless a shorter notice period is
agreed to by the relevant Issuer, in its sole discretion), that an Issuer issue
a Letter of Credit, or extend the Stated Expiry Date of a Standby Letter of
Credit, in such form as may be requested by the Borrower and approved by such
Issuer, solely for the purposes described in Section 7.1.7. In connection with
any Issuance Request the Borrower and/or applicable Subsidiary shall have
executed and delivered such applications, agreements and other instruments
relating to such Letter of Credit as such Issuer shall have reasonably requested
consistent with its then current practices and procedures with respect to
letters of credit of the same type, provided that in the event of any conflict
between any such application, agreement or other instrument and the provisions
of this Agreement, the provisions of this Agreement shall control. Each Standby
Letter of Credit shall by its terms be stated to expire on a date (its “Stated
Expiry Date”) no later than the earlier to occur of (i) five Business Days prior
to the Revolving Loan Commitment Termination Date or (ii) unless otherwise
agreed to by an Issuer, in its sole discretion, one year from the date of its
issuance (provided each Standby Letter of Credit may, with the consent of the
Issuer thereof in its sole discretion, provide for automatic renewals for one
year periods (which in no event shall extend beyond the Revolving Loan
Commitment Termination Date)). Each Commercial Letter of Credit shall by its
terms be stated to expire on a date no later than the earlier to occur of
(i) five Business Days prior to the Revolving Loan Commitment Termination Date
or (ii) unless otherwise agreed to by an Issuer, in its sole discretion,
180 days from the date of its issuance. Each Issuer will make available to the
beneficiary thereof the original of the Letter of Credit which it issues. Each
Issuer shall provide periodic reporting of Letters of Credit issued by such
Issuer in a manner, and in time periods, mutually acceptable to the
Administrative Agent and such Issuer. Unless notified by the Administrative
Agent in writing prior to the issuance of a Letter of Credit, the applicable
Issuer shall be entitled to assume that the conditions precedent to such
issuance have been met.
     SECTION 2.6.1 Other Lenders Participation. Upon the issuance of each Letter
of Credit, and without further action, each Revolving Loan Lender (other than
the applicable Issuer) shall be deemed to have irrevocably purchased, to the
extent of its Revolving Loan Percentage, a participation interest in such Letter
of Credit (including the Contingent Liability and any Reimbursement Obligation
with respect thereto), and such Revolving Loan Lender shall, to the
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extent of its Revolving Loan Percentage, be responsible for reimbursing the
applicable Issuer for Reimbursement Obligations which have not been reimbursed
by the Borrower in accordance with Section 2.6.3 in the applicable currency and
at the times set forth in such Section (with the terms of this Section surviving
the termination of this Agreement). In addition, such Revolving Loan Lender
shall, to the extent of its Revolving Loan Percentage, be entitled to receive a
ratable portion of the Letter of Credit fees payable pursuant to Section 3.3.3
with respect to each Letter of Credit (other than the issuance fees payable to
the Issuer of such Letter of Credit pursuant to the last sentence of
Section 3.3.3) and of interest payable pursuant to Section 3.2 with respect to
any Reimbursement Obligation accruing on and after the date (and to the extent)
such Lender funds its participation interest in such Letter of Credit. To the
extent that any Revolving Loan Lender has reimbursed any Issuer for a
Disbursement, such Lender shall be entitled to receive its ratable portion of
any amounts subsequently received (from the Borrower or otherwise) in respect of
such Disbursement. Upon any change in the Revolving Loan Commitments pursuant to
an assignment under Section 10.10 of this Agreement, it is hereby agreed that
with respect to all Letter of Credit Outstandings, there shall be an automatic
adjustment to the participations hereby created to reflect the new Revolving
Loan Percentage of the assigning and assignee Revolving Loan Lenders.
     SECTION 2.6.2 Disbursements. An Issuer will notify the Borrower and the
Administrative Agent promptly of the presentment for payment of any Letter of
Credit issued by such Issuer, together with notice of the date (the
“Disbursement Date”) such payment shall be made (each such payment, a
“Disbursement”). Subject to the terms and provisions of such Letter of Credit
and this Agreement, the applicable Issuer shall make such payment to the
beneficiary (or its designee) of such Letter of Credit. Not later than 1:00 p.m.
on (i) a Disbursement Date, if the Borrower shall have received notice of such
Disbursement prior to 10:00 a.m. on such Disbursement Date, or (ii) the Business
Day immediately following a Disbursement Date, if such notice is received after
10:00 a.m. on such Disbursement Date, the Borrower will reimburse such Issuer
directly in full for such Disbursement. Each such reimbursement shall be made in
immediately available funds in the Currency in which such Disbursement was made
together (in the case of a reimbursement made on such immediately following
Business Day, with interest thereon at a rate per annum equal to the rate per
annum then in effect for Base Rate Loans (with the then Applicable Margin for
Revolving Loans accruing on such amount) pursuant to Section 3.2 for the period
from the Disbursement Date through the date of such reimbursement, provided that
if such reimbursement is not made when due pursuant to this Section 2.6.2, then
the interest rates set forth in Section 3.2.2 shall apply. Without limiting in
any way the foregoing and notwithstanding anything to the contrary contained
herein or in any separate application for any Letter of Credit, the Borrower
hereby acknowledges and agrees that it shall be obligated to reimburse the
applicable Issuer upon each Disbursement of a Letter of Credit, and it shall be
deemed to be the obligor for purposes of each such Letter of Credit issued
hereunder (whether the account party on such Letter of Credit is the Borrower or
a Subsidiary). In the event that an Issuer makes any Disbursement and the
Borrower shall not have reimbursed such amount in full to such Issuer pursuant
to this Section 2.6.2, such Issuer shall promptly notify the Administrative
Agent which shall promptly notify each Revolving Loan Lender of such failure,
and each Revolving Loan Lender (other than such Issuer) shall promptly and
unconditionally pay in the Currency in which such Disbursement was made and in
same day funds to the Administrative Agent for the account of such Issuer the
amount of such Revolving Loan Lender’s Revolving Loan Percentage of such
unreimbursed Disbursement. If an Issuer so notifies the Administrative
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Agent, and the Administrative Agent so notifies the Revolving Loan Lenders prior
to 2 p.m., on any Business Day, each such Revolving Loan Lender shall make
available to such Issuer such Revolving Loan Lender’s Revolving Loan Percentage
of the amount of such payment on such Business Day in same day funds (or if such
notice is received by such Revolving Loan Lenders after 2 p.m. on the day of
receipt, payment shall be made on the immediately following Business Day). If
and to the extent such Revolving Loan Lender shall not have so made its
Revolving Loan Percentage of the amount of such payment available to the
applicable Issuer, such Revolving Loan Lender agrees to pay to such Issuer
forthwith on demand such amount, together with interest thereon, for each day
from such date until the date such amount is paid to the Administrative Agent
for the account of such Issuer, at the Federal Funds Rate.
     SECTION 2.6.3 Reimbursement. The obligation (a “Reimbursement Obligation”)
of the Borrower under Section 2.6.2 to reimburse an Issuer with respect to each
Disbursement (including interest thereon) and, upon the failure of the Borrower
to reimburse an Issuer, each Revolving Loan Lender’s obligation under
Section 2.6.1 to reimburse an Issuer, shall be absolute and unconditional under
any and all circumstances and irrespective of (i) any setoff, counterclaim or
defense to payment which the Borrower or such Revolving Loan Lender, as the case
may be, may have or have had against such Issuer, any Lender or any other Person
(including any Subsidiary) for any reason whatsoever, including any defense
based upon the failure of any Disbursement to conform to the terms of the
applicable Letter of Credit (if, in such Issuer’s good faith opinion (absent
such Issuer’s gross negligence or willful misconduct), such Disbursement is
determined to be appropriate) or any non-application or misapplication by the
beneficiary of the proceeds of such Letter of Credit; (ii) the occurrence or
continuance of any Default; (iii) any adverse change in the condition (financial
or otherwise) of any Obligor; (iv) the acceleration or maturity of any
Obligations or the termination of any Commitment after the issuance of a Letter
of Credit; (v) any breach of any Loan Document by any Person; or (vi) any other
circumstance, happening or event whatsoever, whether or not similar to any of
the foregoing (including any of the events set forth in Section 2.6.5); provided
that, after paying in full its Reimbursement Obligation hereunder, nothing
herein shall adversely affect the right of the Borrower or such Lender, as the
case may be, to commence any proceeding against an Issuer for any wrongful
Disbursement made by such Issuer under a Letter of Credit as a result of acts or
omissions constituting gross negligence, bad faith or willful misconduct on the
part of such Issuer.
     SECTION 2.6.4 Deemed Disbursements. Upon the occurrence and during the
continuation of any Event of Default under Section 8.1.9 or upon notification by
the Administrative Agent (acting at the direction of the Required Lenders) to
the Borrower of its obligations under this Section, following the occurrence and
during the continuation of any other Event of Default,
     (a) the aggregate Stated Amount of all Letters of Credit shall, without
demand upon or notice to the Borrower or any other Person, be deemed to have
been paid or disbursed by the Issuers of such Letters of Credit (notwithstanding
that such amount may not in fact have been paid or disbursed); and
     (b) the Borrower shall be immediately obligated to reimburse the Issuers
for the amount deemed to have been so paid or disbursed by such Issuers.
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Amounts payable by the Borrower pursuant to this Section shall be deposited in
immediately available funds with the Collateral Agent and held as cash
collateral security for the Reimbursement Obligations. When all Defaults giving
rise to the deemed disbursements under this Section have been cured or waived
the Collateral Agent shall return to the Borrower all amounts then on deposit
with the Collateral Agent pursuant to this Section which have not been applied
to the satisfaction of the Reimbursement Obligations.
     SECTION 2.6.5 Nature of Reimbursement Obligations. The Borrower, each other
Obligor and, to the extent set forth in Section 2.6.1, each Revolving Loan
Lender shall assume all risks of the acts, omissions or misuse of any Letter of
Credit by the beneficiary thereof. No Issuer (except to the extent of its own
gross negligence, bad faith or willful misconduct) shall be responsible for:
     (a) the form, validity, sufficiency, accuracy, genuineness or legal effect
of any Letter of Credit or any document submitted by any party in connection
with the application for and issuance of a Letter of Credit, even if it should
in fact prove to be in any or all respects invalid, insufficient, inaccurate,
fraudulent or forged;
     (b) the form, validity, sufficiency, accuracy, genuineness or legal effect
of any instrument transferring or assigning or purporting to transfer or assign
a Letter of Credit or the rights or benefits thereunder or the proceeds thereof
in whole or in part, which may prove to be invalid or ineffective for any
reason;
     (c) failure of the beneficiary to comply fully with conditions required in
order to demand payment under a Letter of Credit;
     (d) errors, omissions, interruptions or delays in transmission or delivery
of any messages, by mail, cable, telegraph, telex or otherwise or errors in
interpretation of technical terms or any consequence arising from causes beyond
the control of such Issuer; or
     (e) any loss or delay in the transmission or otherwise of any document or
draft required in order to make a Disbursement under a Letter of Credit.
In furtherance of the foregoing and without limiting the generality thereof, the
parties agree that with respect to documents presented which appear on their
face to be in substantial compliance with the terms of a Letter of Credit, an
Issuer may, in its sole discretion, either accept and make payment upon such
documents without responsibility for further investigation or refuse to accept
and make payment upon such documents if such documents are not in strict
compliance with the terms of such Letter of Credit. None of the foregoing shall
affect, impair or prevent the vesting of any of the rights or powers granted to
any Issuer or any Revolving Loan Lender hereunder. In furtherance and not in
limitation or derogation of any of the foregoing, any action taken or omitted to
be taken by an Issuer in good faith (and not constituting gross negligence or
willful misconduct) shall be binding upon each Obligor and each such Secured
Party, and shall not put such Issuer under any resulting liability to any
Obligor or any Secured Party, as the case may be.
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     SECTION 2.6.6 Existing Letters of Credit. On the Effective Date, all
Existing Letters of Credit shall be deemed to have been issued hereunder and
shall for all purposes be deemed to be “Letters of Credit” hereunder.
     SECTION 2.7 Register; Notes. The Register shall be maintained on the
following terms.
     (a) The Borrower hereby designates the Administrative Agent to serve as the
Borrower’s agent, solely for the purpose of this clause, to maintain a register
(the “Register”) on which the Administrative Agent will record each Lender’s
Commitment, the Loans made by each Lender and each repayment in respect of the
principal amount of the Loans, annexed to which the Administrative Agent shall
retain a copy of each Lender Assignment Agreement delivered to the
Administrative Agent pursuant to Section 10.11. Failure to make any recordation,
or any error in such recordation, shall not affect any Obligor’s Obligations.
The entries in the Register shall constitute prima facie evidence and shall be
binding, in the absence of manifest error, and the Borrower, the Administrative
Agent and the Lenders shall treat each Person in whose name a Loan is registered
(or, if applicable, to which a Note has been issued) as the owner thereof for
the purposes of all Loan Documents, notwithstanding notice or any provision
herein to the contrary. Any assignment or transfer of a Commitment or the Loans
made pursuant hereto shall be registered in the Register only upon delivery to
the Administrative Agent of a Lender Assignment Agreement that has been executed
by the requisite parties pursuant to Section 10.11. No assignment or transfer of
a Lender’s Commitment or Loans shall be effective unless such assignment or
transfer shall have been recorded in the Register by the Administrative Agent as
provided in this Section.
     (b) The Borrower agrees that, upon the request to the Administrative Agent
by any Lender, the Borrower will execute and deliver to such Lender a Note
evidencing the Loans made by, and payable to the order of, such Lender in a
maximum principal amount equal to such Lender’s Percentage of the original
applicable Commitment Amount. The Borrower hereby irrevocably authorizes each
Lender to make (or cause to be made) appropriate notations on the grid attached
to such Lender’s Note (or on any continuation of such grid), which notations, if
made, shall evidence, inter alia, the date of, the outstanding principal amount
of, and the interest rate and Interest Period applicable to the Loans evidenced
thereby. Such notations shall, to the extent not inconsistent with notations
made by the Administrative Agent in the Register, constitute prima facie
evidence and shall be binding on each Obligor absent manifest error; provided
that, the failure of any Lender to make any such notations shall not limit or
otherwise affect any Obligations of any Obligor.
     SECTION 2.8 Euro Loans.
     (a) If the Borrower requests a Borrowing in Euros, or if pursuant to any
Continuation/Conversion Notice the Borrower elects to continue any LIBO Rate
Loan denominated in Euros, the Administrative Agent shall in the notice given to
the Revolving Loan Lenders pursuant to Section 2.3 or Section 2.4, as the case
may be, give details of such request or election including, as the case may be,
the aggregate principal amount of the Borrowing in Euros to be made by each
Lender pursuant to the terms of this Agreement or the aggregate principal amount
of such LIBO Rate Loans to be continued by each Lender pursuant to the terms of
this Agreement.
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     (b) Each Lender shall be deemed to have confirmed to the Borrower and the
Administrative Agent that Euros are Available to such Lender unless no later
than 9:00 a.m. on the same Business Day of the requested Borrowing or the
proposed continuation it shall have notified the Administrative Agent that Euros
are not Available.
     (c) In the event that the Administrative Agent has received notification
from any of the Lenders that Euros are not Available, then the Administrative
Agent shall notify the Borrower and the Lenders no later than 10:00 a.m. on the
same Business Day of the proposed Borrowing or proposed continuation.
     (d) If the Administrative Agent notifies the Borrower pursuant to clause
(c) above that any of the Lenders has notified the Administrative Agent that
Euros are not Available, such notification shall (i) in the case of such
Borrowing Request, revoke such Borrowing Request and (ii) in the case of any
Continuation/Conversion Notice, such continuation/conversion with respect
thereto shall be deemed withdrawn and such Euro Loans shall be redenominated
into, as directed by the Borrower, Base Rate Loans or LIBO Rate Loans in Dollars
with the Interest Period set forth in such Continuation/Conversion Notice. The
Administrative Agent will promptly notify the Borrower and the Lenders of any
such redenomination and in such notice by the Administrative Agent to each
Lender the Administrative Agent will state the aggregate Dollar Equivalent
amount of the redenominated Euro Loans as of the Revaluation Date with respect
thereto and such Lender’s Percentage thereof.
     (e) Notwithstanding anything herein to the contrary, during the existence
of an Event of Default, upon the request of the Lenders holding in excess of 50%
of the Revolving Loan Commitments, all or any part of any outstanding Euro Loans
shall be redenominated and converted into Base Rate Loans on the last day of the
Interest Period with respect to any such Euro Loans. The Administrative Agent
will promptly notify the Borrower and the Revolving Loan Lenders of any such
redenomination and conversion request.
ARTICLE III
REPAYMENTS, PREPAYMENTS, INTEREST AND FEES
     SECTION 3.1 Repayments and Prepayments; Application. The Borrower agrees
that the Loans shall be repaid and prepaid pursuant to the following terms.
     SECTION 3.1.1 Repayments and Prepayments. The Borrower shall repay in full
the unpaid principal amount of each Loan upon the applicable Stated Maturity
Date therefor. Prior thereto, payments and prepayments of the Loans shall or may
be made as set forth below.
     (a) From time to time on any Business Day, the Borrower may make a
voluntary prepayment, in whole or in part, of the outstanding principal amount
of any
     (i) Loans (other than Swing Line Loans); provided that, (A) any such
voluntary prepayment of the Term Loans shall be made among Term A Loans and/or
Term B Loans as directed by the Borrower, and among Term A Loans or Term B
Loans, as applicable, of the same type and, if applicable, having the same
Interest Period of all Lenders that have made such Term A Loans or Term B Loans
(applied to the remaining amortization payments for the Term A Loans or the Term
B Loans, as the case may be, in
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such amounts as the Borrower shall determine) and any such prepayment of
Revolving Loans shall be made pro rata among the Revolving Loans of the same
type and denominated in the same Currency, if applicable, having the same
Interest Period of all Lenders that have made such Revolving Loans; (B) all such
voluntary prepayments shall require at least (1) in the case of Base Rate Loans,
one but no more than five Business Days’ prior notice to the Administrative
Agent and (2) in the case of LIBO Rate Loans, three but no more than five
Business Days’ prior notice to the Administrative Agent; and (C) all such
voluntary partial prepayments shall be in an aggregate minimum amount of
$1,000,000 and an integral multiple of $500,000; and
     (ii) Swing Line Loans; provided that, (A) all such voluntary prepayments
shall require prior telephonic notice to the Swing Line Lender on or before 1:00
p.m. on the day of such prepayment (such notice to be confirmed in writing
within 24 hours thereafter); and (B) all such voluntary partial prepayments
shall be in an aggregate minimum amount of $200,000 and an integral multiple of
$100,000.
     (b) On each date when the aggregate Revolving Exposure of all Revolving
Loan Lenders exceeds the Revolving Loan Commitment Amount (as it may be reduced
from time to time pursuant to this Agreement), the Borrower shall make a
mandatory prepayment of Revolving Loans or Swing Line Loans (or both) and, if
necessary, Cash Collateralize all Letter of Credit Outstandings, in an aggregate
amount equal to such excess.
     (c) On the Stated Maturity Date and on each Quarterly Payment Date
occurring during any period set forth below, the Borrower shall make a scheduled
repayment of the aggregate outstanding principal amount, if any, of all Term A
Loans in an amount equal to the percentage of the original principal amount of
all Term A Loans set forth below opposite the Stated Maturity Date or such
Quarterly Payment Date, as applicable:

          Period   Percentage
December 31, 2006 through (and including) September 30, 2007
    1.25 %
October 1, 2007 through (and including) September 30, 2008
    2.50 %
October 1, 2008 through (and including) September 30, 2009
    3.75 %
October 1, 2009 through (and including) September 30, 2010
    5.00 %
October 1, 2010 through (and including) September 30, 2011
    6.25 %
October 1, 2011 through (and including) Stated Maturity
    6.25 %
Date for Term A Loans
  or the then outstanding principal amount of all Term A Loans, if different.

     (d) On each Quarterly Payment Date (beginning with the Quarterly Payment
Date on December 31, 2006), the Borrower shall make a scheduled repayment of the
aggregate outstanding principal amount, if any, of all Term B Loans in an amount
equal to 0.25% of the
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original principal amount of all Term B Loans, with the remaining amount of Term
B Loans due and payable in full on the Stated Maturity Date for Term B Loans.
     (e) Concurrently with the receipt by the Borrower of any Net Equity
Proceeds, the Borrower shall make a mandatory prepayment of the Loans in an
amount equal to the product of (i) such Net Equity Proceeds multiplied by
(ii) the Applicable Percentage, to be applied as set forth in Section 3.1.2.
     (f) The Borrower shall (subject to the next proviso) within 5 Business Days
receipt of any Net Disposition Proceeds or Net Casualty Proceeds, by the
Borrower or any of its U.S. Subsidiaries, deliver to the Administrative Agent a
calculation of the amount of such proceeds, and, to the extent the aggregate
amount of such (i) Net Disposition Proceeds received by the Borrower and its
U.S. Subsidiaries in any period of twelve consecutive calendar months since the
Closing Date exceeds $10,000,000 and (ii) Net Casualty Proceeds received by the
Borrower and its U.S. Subsidiaries in any period of twelve consecutive calendar
months since the Closing Date exceeds $50,000,000, the Borrower shall make a
mandatory prepayment of the Loans in an amount equal to 100% of such excess Net
Disposition Proceeds or Net Casualty Proceeds, as applicable; provided that, so
long as (i) no Event of Default has occurred and is continuing, such proceeds
may be retained by the Borrower and its U.S. Subsidiaries (and be excluded from
the prepayment requirements of this clause) to be invested or reinvested within
one year or, subject to immediately succeeding clause (ii), 18 months or
36 months, as applicable, to the acquisition or construction of other assets or
properties consistent with the businesses permitted to be conducted pursuant to
Section 7.2.1 (including by way of merger or Investment), and (ii) within one
year following the receipt of such Net Disposition Proceeds or Net Casualty
Proceeds, such proceeds are (A) applied or (B) committed to be, and actually
are, applied within (I) 18 months following the receipt of such Net Disposition
Proceeds or (II) 36 months following the receipt of such Net Casualty Proceeds,
in each case to such acquisition or construction plan. The amount of such Net
Disposition Proceeds or Net Casualty Proceeds unused or uncommitted after such
one year, 18 months or 36 months, as applicable, period shall be applied to
prepay the Loans as set forth in Section 3.1.2. At any time after receipt of any
such Net Casualty Proceeds in excess of $25,000,000 but prior to the application
thereof to such mandatory prepayment or the acquisition of other assets or
properties as described above, upon the request by the Administrative Agent
(acting at the direction of the Required Lenders) to the Borrower, the Borrower
shall deposit an amount equal to such excess Net Casualty Proceeds into a cash
collateral account maintained with (and subject to documentation reasonably
satisfactory to) the Collateral Agent for the benefit of the Secured Parties
(and over which the Collateral Agent shall have a first priority perfected Lien)
pending application as a prepayment or to be released as requested by the
Borrower in respect of such acquisition. Amounts deposited in such cash
collateral account shall be invested in Cash Equivalent Investments, as directed
by the Borrower.
     (g) Within 100 days after the close of each Fiscal Year (beginning with the
Fiscal Year ending 2007) the Borrower shall make a mandatory prepayment of the
Loans in an amount equal to the product of (i) the Excess Cash Flow (if any) for
such Fiscal Year multiplied by (ii) the Applicable Percentage minus (iii) the
aggregate amount of all voluntary prepayments of Loans (but including Revolving
Loans and Swing Line Loans only to the extent of a corresponding reduction of
the Revolving Loan Commitment Amount pursuant to Section 2.2.1) made during such
Fiscal Year, to be applied as set forth in Section 3.1.2;
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     (h) Concurrently with the receipt by the Borrower or any of its U.S.
Subsidiaries of any Net Debt Proceeds, the Borrower shall make a mandatory
prepayment of the Loans in an amount equal to 100% of such Net Debt Proceeds, to
be applied as set forth in Section 3.1.2.
     (i) Concurrently with the receipt by the Borrower or any of its U.S.
Subsidiaries of any Net Receivables Proceeds, the Borrower shall make a
mandatory prepayment of the Term Loans in an amount equal to 100% of such Net
Receivables Proceeds, to be applied as set forth in Section 3.1.2.
     (j) Immediately upon any acceleration of the Stated Maturity Date of any
Loans pursuant to Section 8.2 or Section 8.3, the Borrower shall repay all the
Loans, unless, pursuant to Section 8.3, only a portion of all the Loans is so
accelerated (in which case the portion so accelerated shall be so repaid).
Each prepayment of any Loans made pursuant to this Section shall be without
premium or penalty, except as may be required by Section 4.4.
     SECTION 3.1.2 Application. Amounts prepaid pursuant to Section 3.1.1 shall
be applied as set forth in this Section.
     (a) Subject to clause (b), each prepayment or repayment of the principal of
the Loans shall be applied, to the extent of such prepayment or repayment,
first, to the principal amount thereof being maintained as Base Rate Loans, and
second, subject to the terms of Section 4.4, to the principal amount thereof
being maintained as LIBO Rate Loans.
     (b) Each prepayment of the Loans made pursuant to clauses (e), (f), (g),
(h) and (i) of Section 3.1.1 shall be applied (i) first, pro rata to a mandatory
prepayment of the outstanding principal amount of all Term Loans (with the
amount of such prepayment of the Term Loans being applied (A) first to the
remaining Term A Loan or Term B Loan, as the case may be, to reduce in direct
order of maturity the amortization payments that are due and payable within 24
calendar months from the date of such prepayment, and (B) second, to the extent
in excess of the amounts to be applied pursuant to the preceding clause (A), to
reduce the then remaining Term Loan amortization payments on a pro rata basis),
and (ii) second, once all Term Loans have been repaid in full, to the repayment
of any outstanding Revolving Loans and a reduction of the Revolving Loan
Commitment Amount in accordance with Section 2.2.2; provided that, so long as,
and to the extent, Term A Loans are outstanding and subject to the terms set
forth in the immediately succeeding clause (c), each Lender with Term B Loans
entitled to receive any mandatory prepayment of its Loans under this clause may
waive its right to receive any such mandatory prepayment, and the aggregate
amount of such prepayments so waived shall be applied as a mandatory prepayment
of Term A Loans for application in accordance with this clause.
     (c) So long as the Administrative Agent has received prior written notice
from the Borrower of a mandatory prepayment pursuant to clauses (e), (f), (g),
(h) and (i) of Section 3.1.1, the Administrative Agent shall provide notice of
such mandatory prepayment to the Lenders with Term Loans. Unless the
Administrative Agent shall otherwise so provide, in the event a Lender with Term
B Loan does not notify the Administrative Agent in writing of its waiver of the
right
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to receive its pro rata share of such mandatory prepayment within two Business
Days of the providing of such notice by the Administrative Agent, unless
otherwise determined by the Administrative Agent, such Lender shall be
irrevocably deemed not to have waived its rights to receive its applicable pro
rata share of such mandatory prepayment. It is understood and agreed by the
Borrower that, notwithstanding receipt by the Administrative Agent of any such
mandatory prepayment, the Term Loans shall not be deemed repaid, unless
otherwise consented to by the Administrative Agent, until five Business Days
have elapsed from the delivery to the Administrative Agent of the notice
described above in this clause (c).
     SECTION 3.2 Interest Provisions. Interest on the outstanding principal
amount of the Loans shall accrue and be payable in accordance with the terms set
forth below.
     SECTION 3.2.1 Rates. Subject to Section 2.3.2, pursuant to an appropriately
delivered Borrowing Request or Continuation/Conversion Notice, the Borrower may
elect that the Loans comprising a Borrowing accrue interest at a rate per annum:
     (a) on that portion maintained from time to time as a Base Rate Loan, equal
to the sum of the Alternate Base Rate from time to time in effect plus the
Applicable Margin; provided that, Swing Line Loans shall always accrue interest
at the Alternate Base Rate plus the then effective Applicable Margin for
Revolving Loans maintained as Base Rate Loans; and
     (b) on that portion maintained as a LIBO Rate Loan, during each Interest
Period applicable thereto, equal to the sum of the LIBO Rate (Reserve Adjusted)
or the LIBO Alternate Rate, as the case may be, applicable to the Currency in
which such Loans are denominated for such Interest Period plus the Applicable
Margin.
All LIBO Rate Loans shall bear interest from and including the first day of the
applicable Interest Period to (but not including) the last day of such Interest
Period at the interest rate determined as applicable to such LIBO Rate Loan.
     SECTION 3.2.2 Post-Default Rates. After the occurrence and during the
continuance of an Event of Default, the Borrower shall pay (in the applicable
Currency or the Dollar Equivalent of Euros, as the Borrower shall determine),
but only to the extent permitted by law, interest (after as well as before
judgment) on all outstanding Obligations at a rate per annum equal to (a) in the
case of principal on any Loan, the rate of interest that otherwise would be
applicable to such Loan plus 2% per annum; and (b) in the case of overdue
interest, fees, and other monetary Obligations, the Alternate Base Rate from
time to time in effect, plus the Applicable Margin for Term B Loans accruing
interest at the Alternate Base Rate, plus 2% per annum.
     SECTION 3.2.3 Payment Dates. Interest accrued on each Loan shall be
payable, without duplication:
     (a) on the Stated Maturity Date therefor;
     (b) on the date of any payment or prepayment, in whole or in part, of
principal outstanding on such Loan on the principal amount so paid or prepaid;
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     (c) with respect to Base Rate Loans, on each Quarterly Payment Date
occurring after the Closing Date;
     (d) with respect to LIBO Rate Loans, on the last day of each applicable
Interest Period (and, if such Interest Period shall exceed three months, on the
date occurring on each three-month interval occurring after the first day of
such Interest Period);
     (e) with respect to any Base Rate Loans converted into LIBO Rate Loans on a
day when interest would not otherwise have been payable pursuant to clause (c),
on the date of such conversion; and
     (f) on that portion of any Loans the Stated Maturity Date of which is
accelerated pursuant to Section 8.2 or Section 8.3, immediately upon such
acceleration.
Interest accrued on Loans or other monetary Obligations after the date such
amount is due and payable (whether on the Stated Maturity Date, upon
acceleration or otherwise) shall be payable upon demand.
     SECTION 3.3 Fees. The Borrower agrees to pay the fees set forth below. All
such fees shall be non-refundable when earned and paid.
     SECTION 3.3.1 Commitment Fee. The Borrower agrees to pay to the
Administrative Agent for the account of each Non-Defaulting Lender, for the
period (including any portion thereof when its Revolving Loan Commitments are
suspended by reason of the Borrower’s inability to satisfy any condition of
Article V) commencing on the Closing Date and continuing through the Revolving
Loan Commitment Termination Date, a commitment fee in an amount equal to the
Applicable Commitment Fee Margin, in each case on such Revolving Loan Lender’s
Revolving Loan Percentage of the sum of the average daily unused portion of the
Revolving Loan Commitment Amount (net of Letter of Credit Outstandings). All
commitment fees payable pursuant to this Section shall be calculated on a year
comprised of 360 days and payable by the Borrower in arrears on each Quarterly
Payment Date, commencing with the first Quarterly Payment Date following the
Closing Date, and on the Revolving Loan Commitment Termination Date. The making
of Swing Line Loans shall not constitute usage of the Revolving Loan Commitment
with respect to the calculation of commitment fees to be paid by the Borrower to
the Revolving Loan Lenders.
     SECTION 3.3.2 Administrative Agent, Collateral Agent and Lead Arrangers’
Fees. The Borrower agrees to pay to each of the Agents and each Lead Arranger,
for its own account, the fees in the amounts and on the dates set forth in the
Fee Letter or in such other fee letter(s) negotiated by the parties thereto.
     SECTION 3.3.3 Letter of Credit Fee. The Borrower agrees to pay to the
Administrative Agent, for the pro rata account of the applicable Issuer and each
Revolving Loan Lender, a Letter of Credit fee in a per annum amount equal to the
then effective Applicable Margin for Revolving Loans maintained as LIBO Rate
Loans, multiplied by the Stated Amount of each such Letter of Credit, such fees
being payable quarterly in arrears on each Quarterly Payment Date following the
date of issuance of each Letter of Credit and on the Revolving Loan Commitment
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Termination Date. The Borrower further agrees to pay to the applicable Issuer an
issuance fee and such other reasonable fees and charges in connection with the
issuance, negotiation, settlement, amendment and processing of each Letter of
Credit as specified in the fee letter between the Borrower and HSBC or as
otherwise agreed to by the Borrower and such Issuer.
ARTICLE IV
CERTAIN LIBO RATE AND OTHER PROVISIONS
     SECTION 4.1 LIBO Rate Lending Unlawful. If any Lender shall determine
(which determination shall, upon notice thereof to the Borrower and the
Administrative Agent, constitute prima facie evidence thereof and shall be
binding on the Borrower absent manifest error) that the introduction of or any
change in or in the interpretation of any law makes it unlawful, or any
Governmental Authority asserts that it is unlawful, for such Lender to make or
continue any Loan as, or to convert any Loan into, a LIBO Rate Loan, the
obligations of such Lender to make, continue or convert any such LIBO Rate Loan
shall, upon such determination, forthwith be suspended until such Lender shall
notify the Administrative Agent that the circumstances causing such suspension
no longer exist, and all (i) outstanding LIBO Rate Loans denominated in Dollars
payable to such Lender shall automatically convert into Base Rate Loans at the
end of the then current Interest Periods with respect thereto or sooner, if
required by such law or assertion and (ii) all LIBO Rate Loans denominated in
Euros shall automatically become due and payable at the end of the then current
Interest Periods with respect thereto or sooner, if required by applicable law.
     SECTION 4.2 Deposits Unavailable. If the Administrative Agent shall have
determined that
     (a) Dollar deposits in the relevant amount and for the relevant Interest
Period are not available to it in its relevant market; or
     (b) by reason of circumstances affecting it’s relevant market, adequate
means do not exist for ascertaining the interest rate applicable hereunder to
LIBO Rate Loans denominated in any Currency;
then, upon notice from the Administrative Agent to the Borrower and the Lenders,
the obligations of all Lenders under Section 2.3 and Section 2.4 to make or
continue any Loans as, or to convert any Loans into, LIBO Rate Loans denominated
in such Currency shall forthwith be suspended until the Administrative Agent
shall notify the Borrower and the Lenders that the circumstances causing such
suspension no longer exist.
     SECTION 4.3 Increased LIBO Rate Loan Costs, etc. The Borrower agrees to
reimburse each Lender and each Issuer for any increase in the cost to such
Lender or Issuer of, or any reduction in the amount of any sum receivable by
such Secured Party in respect of, such Secured Party’s Commitments and the
making of Credit Extensions hereunder (including the making, continuing or
maintaining (or of its obligation to make or continue) any Loans as, or of
converting (or of its obligation to convert) any Loans into, LIBO Rate Loans)
that arise in connection with any change in, or the introduction, adoption,
effectiveness, interpretation, reinterpretation or phase-in after the Closing
Date of, any law or regulation, directive, guideline,
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decision or request (whether or not having the force of law) of any Governmental
Authority, except for such changes with respect to increased capital costs and
Taxes which are governed by Sections 4.5 and 4.6, respectively. Each affected
Secured Party shall promptly notify the Administrative Agent and the Borrower in
writing of the occurrence of any such event, stating the reasons therefor and
the additional amount required fully to compensate such Secured Party for such
increased cost or reduced amount. Such additional amounts shall be payable by
the Borrower directly to such Secured Party within five Business Days of its
receipt of such notice, and such notice shall, in the absence of manifest error,
constitute prima facie evidence thereof and shall be binding on the Borrower.
     SECTION 4.4 Funding Losses. In the event any Lender shall incur any actual
loss or expense (including any actual loss or expense incurred by reason of the
liquidation or reemployment of deposits or other funds acquired by such Lender
(if any) to make or continue any portion of the principal amount of any Loan as,
or to convert any portion of the principal amount of any Loan into, a LIBO Rate
Loan) as a result of
     (a) any conversion or repayment or prepayment of the principal amount of
any LIBO Rate Loan on a date other than the scheduled last day of the Interest
Period applicable thereto, whether pursuant to Article III or otherwise;
     (b) any Loans not being made continued or converted as LIBO Rate Loans in
accordance with the Borrowing Request or other notice therefor;
     (c) any Loans not being continued as, or converted into, LIBO Rate Loans in
accordance with the Continuation/Conversion Notice therefor; or
     (d) the assignment of any LIBO Rate Loan other than on the last day of an
Interest Period therefor as a result of a request by the Borrower pursuant to
Section 4.11;
then, upon the written notice of such Lender to the Borrower (with a copy to the
Administrative Agent), the Borrower shall, within five days of its receipt
thereof, pay directly to such Lender such amount as will (in the reasonable
determination of such Lender) reimburse such Lender for such actual loss or
expense. Such written notice shall, in the absence of manifest error, constitute
prima facie evidence thereof and shall be binding on the Borrower.
     SECTION 4.5 Increased Capital Costs. If any change in, or the introduction,
adoption, effectiveness, interpretation, reinterpretation or phase-in of, any
law or regulation, directive, guideline, decision or request (whether or not
having the force of law) of any Governmental Authority after the Closing Date
affects or would affect the amount of capital required or expected to be
maintained by any Secured Party or any Person controlling such Secured Party,
and such Secured Party determines (in good faith but in its sole and absolute
discretion) that as a result thereof the rate of return on its or such
controlling Person’s capital as a consequence of the Commitments or the Credit
Extensions made, or the Letters of Credit participated in, by such Secured Party
is reduced to a level below that which such Secured Party or such controlling
Person could have achieved but for the occurrence of any such circumstance, then
upon notice (together with reasonably detailed supporting documentation) from
time to time by such Secured Party to the Borrower, the Borrower shall within
five Business Days following receipt of such
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notice pay directly to such Secured Party additional amounts sufficient to
compensate such Secured Party or such controlling Person for such reduction in
rate of return. A statement in reasonable detail of such Secured Party as to any
such additional amount or amounts shall, in the absence of manifest error,
constitute prima facie evidence thereof and shall be binding on the Borrower. In
determining such amount, such Secured Party may use any method of averaging and
attribution that it (in its sole and absolute discretion) shall deem applicable.
     SECTION 4.6 Taxes. The Borrower covenants and agrees as follows with
respect to Taxes.
     (a) Any and all payments by the Borrower under each Loan Document shall be
made without setoff, counterclaim or other defense, and free and clear of, and
without deduction or withholding for or on account of, any Taxes. In the event
that any Taxes are imposed and required to be deducted or withheld from any
payment required to be made by any Obligor to or on behalf of any Secured Party
under any Loan Document, then:
     (i) subject to clause (f), if such Taxes are Non-Excluded Taxes, the amount
of such payment shall be increased as may be necessary so that such payment is
made, after withholding or deduction for or on account of such Taxes, in an
amount that is not less than the amount provided for in such Loan Document; and
     (ii) the Borrower shall withhold the full amount of such Taxes from such
payment (as increased pursuant to clause (a)(i)) and shall pay such amount to
the Governmental Authority imposing such Taxes in accordance with applicable
law.
     (b) In addition, the Borrower shall pay all Other Taxes imposed to the
relevant Governmental Authority imposing such Other Taxes in accordance with
applicable law.
     (c) Upon the written request of the Administrative Agent, as promptly as
practicable after the payment of any Taxes or Other Taxes, and in any event
within 45 days of any such written request, the Borrower shall furnish to the
Administrative Agent a copy of an official receipt (or a certified copy thereof)
evidencing the payment of such Taxes or Other Taxes. The Administrative Agent
shall make copies thereof available to any Lender upon request therefor.
     (d) Subject to clause (f), the Borrower shall indemnify each Secured Party
for any Non-Excluded Taxes and Other Taxes levied, imposed or assessed on (and
whether or not paid directly by) such Secured Party whether or not such
Non-Excluded Taxes or Other Taxes are correctly or legally asserted by the
relevant Governmental Authority; provided that if the Borrower reasonably
believes that such Taxes were not correctly or legally asserted, such Secured
Party will use reasonable efforts to cooperate with the Borrower to obtain a
refund of such Taxes so long as such efforts would not, in the sole
determination of such Secured Party, result in any additional costs, expenses or
risks or be otherwise disadvantageous to it. Promptly upon having knowledge that
any such Non-Excluded Taxes or Other Taxes have been levied, imposed or
assessed, and promptly upon notice thereof by any Secured Party, the Borrower
shall pay such Non-Excluded Taxes or Other Taxes directly to the relevant
Governmental Authority (provided that, no Secured Party shall be under any
obligation to provide any such notice to the Borrower). In addition, the
Borrower shall indemnify each Secured Party for any incremental
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Taxes that may become payable by such Secured Party as a result of any failure
of the Borrower to pay any Taxes when due to the appropriate Governmental
Authority or to deliver to the Administrative Agent, pursuant to clause (c),
documentation evidencing the payment of Taxes or Other Taxes (other than
incidental taxes resulting directly as a result of the willful misconduct or
gross negligence of the Administrative Agent or a respective Secured Party);
provided that if the Secured Party or Administrative Agent, as applicable, fails
to give notice to the Borrower of the imposition of any Non-Excluded Taxes or
Other Taxes within 120 days following its receipt of actual written notice of
the imposition of such Non-Excluded Taxes or Other Taxes, there will be no
obligation for the Borrower to pay interest or penalties attributable to the
period beginning after such 120th day and ending seven days after the Borrower
receives notice from the Secured Party or the Administrative Agent as
applicable. With respect to indemnification for Non-Excluded Taxes and Other
Taxes actually paid by any Secured Party or the indemnification provided in the
immediately preceding sentence, such indemnification shall be made within
30 days after the date such Secured Party makes written demand therefor
(together with supporting documentation in reasonable detail). The Borrower
acknowledges that any payment made to any Secured Party or to any Governmental
Authority in respect of the indemnification obligations of the Borrower provided
in this clause shall constitute a payment in respect of which the provisions of
clause (a) and this clause shall apply.
     (e) Each Non-U.S. Lender, on or prior to the date on which such Non-U.S.
Lender becomes a Lender hereunder (and from time to time thereafter upon the
request of the Borrower or the Administrative Agent, but only for so long as
such non-U.S. Lender is legally entitled to do so), shall deliver to the
Borrower and the Administrative Agent either (i) two duly completed copies of
either (x) Internal Revenue Service Form W-8BEN claiming eligibility of the
Non-U.S. Lender for benefits of an income tax treaty to which the United States
is a party or (y) Internal Revenue Service Form W-8ECI, or in either case an
applicable successor form; or (ii) in the case of a Non-U.S. Lender that is not
legally entitled to deliver either form listed in clause (e)(i), (x) a
certificate to the effect that such Non-U.S. Lender is not (A) a “bank” within
the meaning of Section 881(c)(3)(A) of the Code, (B) a “10 percent shareholder”
of the Borrower within the meaning of Section 881(c)(3)(B) of the Code, or (C) a
controlled foreign corporation receiving interest from a related person within
the meaning of Section 881(c)(3)(C) of the Code (referred to as an “Exemption
Certificate”) and (y) two duly completed copies of Internal Revenue Service Form
W-8BEN or applicable successor form.
     (f) The Borrower shall not be obligated to pay any additional amounts to
any Lender pursuant to clause (a)(i), or to indemnify any Lender pursuant to
clause (d), in respect of United States federal withholding taxes to the extent
imposed as a result of (i) the failure of such Lender to deliver to the Borrower
the form or forms and/or an Exemption Certificate, as applicable to such Lender,
pursuant to clause (e), (ii) such form or forms and/or Exemption Certificate not
establishing a complete exemption from U.S. federal withholding tax or the
information or certifications made therein by the Lender being untrue or
inaccurate on the date delivered in any material respect, or (iii) the Lender
designating a successor lending office at which it maintains its Loans which has
the effect of causing such Lender to become obligated for tax payments in excess
of those in effect immediately prior to such designation; provided that the
Borrower shall be obligated to pay additional amounts to any such Lender
pursuant to clause (a)(i) and to indemnify any such Lender pursuant to clause
(d), in respect of United States federal withholding taxes if (i) any such
failure to deliver a form or forms or an Exemption Certificate or
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the failure of such form or forms or Exemption Certificate to establish a
complete exemption from U.S. federal withholding tax or inaccuracy or untruth
contained therein resulted from a change in any applicable statute, treaty,
regulation or other applicable law or any interpretation of any of the foregoing
occurring after the Closing Date, which change rendered such Lender no longer
legally entitled to deliver such form or forms or Exemption Certificate or
otherwise ineligible for a complete exemption from U.S. federal withholding tax,
or rendered the information or certifications made in such form or forms or
Exemption Certificate untrue or inaccurate in a material respect, (ii) the
redesignation of the Lender’s lending office was made at the request of the
Borrower or (iii) the obligation to pay any additional amounts to any such
Lender pursuant to clause (a)(i) or to indemnify any such Lender pursuant to
clause (d) is with respect to an Eligible Assignee that becomes an assignee
Lender as a result of an assignment made at the request of the Borrower.
     (g) If the Administrative Agent or a Lender determines in its sole, good
faith discretion that amounts recovered or refunded are a recovery or refund of
any Non-Excluded Taxes or Other Taxes as to which it has been indemnified by the
Borrower pursuant to clause (d), or to which the Borrower has paid additional
amounts pursuant to clause (a)(i), it shall pay over such refund to the Borrower
(but only to the extent of indemnity payments made, or additional amounts paid,
by the Borrower under this Section 4.6 with respect to the Non-Excluded Taxes or
Other Taxes that give rise to such refund), net of all reasonable out-of-pocket
expenses of the Administrative Agent or such Lender and without interest (other
than any interest paid by the relevant Governmental Authority with respect to
such refund); provided that in no event will any Lender be required to pay an
amount to the Borrower that would place such Lender in a less favorable net
after-tax position than such Lender would have been in if the additional amounts
giving rise to such refund of any Non-Excluded Taxes or Other Taxes had never
been paid, and provided further that the Borrower, upon the written request of
the Administrative Agent or such Lender, agrees to repay the amount paid over to
the Borrower (plus any penalties, interest, or other charges imposed by the
relevant Governmental Authority unless the Governmental Authority assessed such
penalties, interest, or other charges due to the gross negligence or willful
misconduct of the Administrative Agent or such Lender) to the Administrative
Agent or such Lender in the event the Administrative Agent or such Lender is
required to repay such refund to the Governmental Authority. Nothing in this
Section 4.6(g) shall require any Lender to make available its tax returns or any
other information related to its taxes that it deems confidential.
     SECTION 4.7 Payments, Computations; Proceeds of Collateral, etc. (a) Unless
otherwise expressly provided in a Loan Document, all payments by the Borrower
pursuant to each Loan Document shall be made by the Borrower to the
Administrative Agent for the pro rata account of the Secured Parties entitled to
receive such payment. All payments shall be made without setoff, deduction or
counterclaim not later than 11:00 a.m. on the date due in same day or
immediately available funds, in the applicable Currency, to such account as the
Administrative Agent (or in the case of a reimbursement obligation, the
applicable Issuer) shall specify from time to time by notice to the Borrower.
Funds received after that time shall be deemed to have been received by the
Administrative Agent on the next succeeding Business Day. The Administrative
Agent shall promptly remit in same day funds to each Secured Party its share, if
any, of such payments received by the Administrative Agent for the account of
such Secured Party. All interest (including interest on LIBO Rate Loans) and
fees shall be computed on the basis of the actual number of days (including the
first day but excluding the last day)
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occurring during the period for which such interest or fee is payable over a
year comprised of 360 days (or, in the case of interest on a Base Rate Loan
(calculated at other than the Federal Funds Rate), 365 days or, if appropriate,
366 days). Payments due on other than a Business Day shall be made on the next
succeeding Business Day and such extension of time shall be included in
computing interest and fees in connection with that payment.
     (b) All amounts received as a result of the exercise of remedies under the
Loan Documents (including from the proceeds of collateral securing the
Obligations) or under applicable law shall be applied upon receipt to the
Obligations as follows: (i) first, to the payment of all Obligations owing to
the Agents, in their capacity as Agents (including the fees and expenses of
counsel to the Agents), (ii) second, after payment in full in cash of the
amounts specified in clause (b)(i), to the ratable payment of all interest
(including interest accruing after the commencement of a proceeding in
bankruptcy, insolvency or similar law, whether or not permitted as a claim under
such law) and fees owing under the Loan Documents, and all costs and expenses
owing to the Secured Parties pursuant to the terms of the Loan Documents, until
paid in full in cash, (iii) third, after payment in full in cash of the amounts
specified in clauses (b)(i) and (b)(ii), to the ratable payment of the principal
amount of the Loans then outstanding, the aggregate Reimbursement Obligations
then owing, the Cash Collateralization for contingent liabilities under Letter
of Credit Outstandings and amounts owing to Secured Parties under Rate
Protection Agreements, (iv) fourth, after payment in full in cash of the amounts
specified in clauses (b)(i) through (b)(iii), to the ratable payment of all
other Obligations owing to the Secured Parties, and (v) fifth, after payment in
full in cash of the amounts specified in clauses (b)(i) through (b)(iv), and
following the Termination Date, to each applicable Obligor or any other Person
lawfully entitled to receive such surplus. For purposes of clause (b)(iii), the
“amounts owing” at any time to any Secured Party with respect to a Rate
Protection Agreement to which such Secured Party is a party shall be determined
at such time by the terms of such Rate Protection Agreement or, if not set forth
therein, in accordance with the customary methods of calculating credit exposure
under similar arrangements by the counterparty to such arrangements, taking into
account potential interest rate (or, if applicable, currency or commodities)
movements and the respective termination provisions and notional principal
amount and term of such Rate Protection Agreement.
     SECTION 4.8 Sharing of Payments. If any Secured Party shall obtain any
payment or other recovery (whether voluntary, involuntary, by application of
setoff or otherwise) on account of any Credit Extension or Reimbursement
Obligation (other than pursuant to the terms of Sections 4.3, 4.4, 4.5 or 4.6)
in excess of its pro rata share of payments obtained by all Secured Parties,
such Secured Party shall purchase (in Dollars) from the other Secured Parties
such participations in Credit Extensions made by them as shall be necessary to
cause such purchasing Secured Party to share the excess payment or other
recovery ratably (to the extent such other Secured Parties were entitled to
receive a portion of such payment or recovery) with each of them; provided that,
if all or any portion of the excess payment or other recovery is thereafter
recovered from such purchasing Secured Party, the purchase shall be rescinded
and each Secured Party which has sold a participation to the purchasing Secured
Party shall repay to the purchasing Secured Party the purchase price to the
ratable extent of such recovery together with an amount equal to such selling
Secured Party’s ratable share (according to the proportion of (a) the amount of
such selling Secured Party’s required repayment to the purchasing Secured Party
to (b) total amount so
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recovered from the purchasing Secured Party) of any interest or other amount
paid or payable by the purchasing Secured Party in respect of the total amount
so recovered. The Borrower agrees that any Secured Party purchasing a
participation from another Secured Party pursuant to this Section may, to the
fullest extent permitted by law, exercise all its rights of payment (including
pursuant to Section 4.9) with respect to such participation as fully as if such
Secured Party were the direct creditor of the Borrower in the amount of such
participation. If under any applicable bankruptcy, insolvency or other similar
law any Secured Party receives a secured claim in lieu of a setoff to which this
Section applies, such Secured Party shall, to the extent practicable, exercise
its rights in respect of such secured claim in a manner consistent with the
rights of the Secured Parties entitled under this Section to share in the
benefits of any recovery on such secured claim.
     SECTION 4.9 Setoff. Each Secured Party shall, upon the occurrence and
during the continuance of any Event of Default described in clauses (a) through
(d) of Section 8.1.9 or, with the consent of the Required Lenders, upon the
occurrence and during the continuance of any other Event of Default, have the
right to appropriate and apply to the payment of the Obligations owing to it (if
then due and payable), and (as security for such Obligations) the Borrower
hereby grants to each Secured Party a continuing security interest in, any and
all balances, credits, deposits, accounts or moneys of the Borrower then or
thereafter maintained with such Secured Party (other than payroll, trust or tax
accounts); provided that, any such appropriation and application shall be
subject to the provisions of Section 4.8. Each Secured Party agrees promptly to
notify the Borrower and the Administrative Agent after any such appropriation
and application made by such Secured Party; provided that, the failure to give
such notice shall not affect the validity of such setoff and application. The
rights of each Secured Party under this Section are in addition to other rights
and remedies (including other rights of setoff under applicable law or
otherwise) which such Secured Party may have.
     SECTION 4.10 Mitigation. Each Lender agrees that if it makes any demand for
payment under Sections 4.3 or 4.6, it will use reasonable efforts (consistent
with its internal policy and legal and regulatory restrictions and so long as
such efforts would not be disadvantageous to it, as determined in its sole
discretion) to designate a different lending office if the making of such a
designation would reduce or obviate the need for the Borrower to make payments
under Section 4.3 or 4.6.
     SECTION 4.11 Removal of Lenders. If any Lender (an “Affected Lender”) (i)
fails to consent to an election, consent, amendment, waiver or other
modification to this Agreement or other Loan Document (a “Non-Consenting
Lender”) that requires the consent of a greater percentage of the Lenders than
the Required Lenders and such election, consent, amendment, waiver or other
modification is otherwise consented to by Non-Defaulting Lenders holding more
than 66 and 2/3% of the Total Exposure Amount of all Non-Defaulting Lenders,
(ii) makes a demand upon the Borrower for (or if the Borrower is otherwise
required to pay) amounts pursuant to Section 4.3, 4.5 or 4.6, or gives notice
pursuant to Section 4.1 requiring a conversion of such Affected Lender’s LIBO
Rate Loans to Base Rate Loans or any change in the basis upon which interest is
to accrue in respect of such Affected Lender’s LIBO Rate Loans or suspending
such Lender’s obligation to make Loans as, or to convert Loans into, LIBO Rate
Loans or, (iii) becomes a Defaulting Lender the Borrower may, at its sole cost
and expense, within 90 days of receipt by the Borrower of such demand or notice
(or the occurrence of such other event causing Borrower to be required to pay
such compensation) or within 90 days of such Lender becoming a Non-Consenting
Lender or a Defaulting Lender, as the case may be, give notice (a “Replacement
Notice”)
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in writing to the Administrative Agent and such Affected Lender of its intention
to cause such Affected Lender to sell all or any portion of its Loans,
Commitments and/or Notes to another financial institution or other Person (a
“Replacement Lender”) designated in such Replacement Notice; provided that no
Replacement Notice may be given by the Borrower if (A) such replacement
conflicts with any applicable law or regulation or (B) prior to any such
replacement, such Lender shall have taken any necessary action under Section 4.5
or 4.6 (if applicable) so as to eliminate the continued need for payment of
amounts owing pursuant to Section 4.5 or 4.6 and withdrew its request for
compensation under Section 4.3, 4.5 or 4.6 . If the Administrative Agent shall,
in the exercise of its reasonable discretion and within 30 days of its receipt
of such Replacement Notice, notify the Borrower and such Affected Lender in
writing that the Replacement Lender is reasonably satisfactory to the
Administrative Agent (such consent not being required where the Replacement
Lender is already a Lender), then such Affected Lender shall, subject to the
payment of any amounts due pursuant to Section 4.4, assign, in accordance with
Section 10.11, the portion of its Commitments, Loans, Notes (if any) and other
rights and obligations under this Agreement and all other Loan Documents
(including Reimbursement Obligations, if applicable) designated in the
replacement notice to such Replacement Lender; provided that (A) such assignment
shall be without recourse, representation or warranty and shall be on terms and
conditions reasonably satisfactory to such Affected Lender and such Replacement
Lender, and (B) the purchase price paid by such Replacement Lender shall be in
the amount of such Affected Lender’s Loans designated in the Replacement Notice
and/or its Percentage of outstanding Reimbursement Obligations, as applicable,
together with all accrued and unpaid interest and fees in respect thereof, plus
all other amounts (including the amounts demanded and unreimbursed under
Sections 4.3, 4.5 and 4.6), owing to such Affected Lender hereunder. Upon the
effective date of an assignment described above, the Replacement Lender shall
become a “Lender” for all purposes under the Loan Documents. Each Lender hereby
grants to the Administrative Agent an irrevocable power of attorney (which power
is coupled with an interest) to execute and deliver, on behalf of such Lender as
assignor, any assignment agreement necessary to effectuate any assignment of
such Lender’s interests hereunder in the circumstances contemplated by this
Section.
     SECTION 4.12 Limitation on Additional Amounts, etc. Notwithstanding
anything to the contrary contained in Sections 4.3 or 4.5 of this Agreement,
unless a Lender gives notice to the Borrower that it is obligated to pay an
amount under any such Section within 90 days after the later of (i) the date the
Lender incurs the respective increased costs, loss, expense or liability,
reduction in amounts received or receivable or reduction in return on capital or
(ii) the date such Lender has actual knowledge of its incurrence of their
respective increased costs, loss, expense or liability, reductions in amounts
received or receivable or reduction in return on capital, then such Lender shall
only be entitled to be compensated for such amount by the Borrower pursuant to
Sections 4.3 or 4.5, as the case may be, to the extent the costs, loss, expense
or liability, reduction in amounts received or receivable or reduction in return
on capital are incurred or suffered on or after the date which occurs 90 days
prior to such Lender giving notice to the Borrower that it is obligated to pay
the respective amounts pursuant to Sections 4.3 or 4.5, as the case may be. This
Section shall have no applicability to any Section of this Agreement other than
Sections 4.3 and 4.5.
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ARTICLE V
CONDITIONS TO CREDIT EXTENSIONS
     SECTION 5.1 Initial Credit Extension. Subject to Section 7.1.11, the
obligations of the Lenders and, if applicable, an Issuer to make the initial
Credit Extension shall be subject to the prior or concurrent satisfaction (or
waiver) in all material respects of each of the conditions precedent set forth
in this Article.
     SECTION 5.1.1 Resolutions, etc. The Lead Arrangers shall have received from
each Obligor, as applicable, (i) a copy of a good standing certificate, dated a
date reasonably close to the Closing Date, for each such Obligor from its
jurisdiction of organization and (ii) a certificate, dated as of the Closing
Date, duly executed and delivered by such Obligor’s Secretary or Assistant
Secretary, managing member or general partner, as applicable, as to
     (a) resolutions of each such Obligor’s Board of Directors (or other
managing body, in the case of other than a corporation) then in full force and
effect authorizing, to the extent relevant, all aspects of the Transaction
applicable to such Obligor and the execution, delivery and performance of each
Loan Document to be executed by such Obligor and the transactions contemplated
hereby and thereby;
     (b) the incumbency and signatures of those of its officers, managing member
or general partner, as applicable, authorized to act with respect to each Loan
Document to be executed by such Obligor; and
     (c) the full force and validity of each Organic Document of such Obligor
and copies thereof;
upon which certificates each Secured Party may conclusively rely until it shall
have received a further certificate of the Secretary, Assistant Secretary,
managing member or general partner, as applicable, of any such Obligor canceling
or amending the prior certificate of such Obligor.
     SECTION 5.1.2 Closing Date Certificate. The Lead Arrangers shall have
received the Closing Date Certificate, dated as of the Closing Date and duly
executed and delivered by an Authorized Officer of the Borrower, in which
certificate the Borrower shall agree and acknowledge and certify that the
statements made therein are, true and correct representations and warranties of
the Borrower as of such date, and, at the time each such certificate is
delivered, such statements shall in fact be true and correct. All documents and
agreements (including Transaction Documents) required to be appended to the
Closing Date Certificate shall be in form and substance reasonably satisfactory
to the Lead Arrangers, shall have been executed and delivered by the requisite
parties, and shall be in full force and effect.
     SECTION 5.1.3 Consummation of Transaction. The Lead Arrangers shall have
received evidence reasonably satisfactory to it that all actions necessary to
consummate the Transaction (other than the entering into of the Senior Note
Documents and the issuance of the Senior Notes) shall have been taken in
accordance in all material respects with all applicable law and in accordance
with the terms of each applicable Transaction Document, without amendment or
waiver of any material provision thereof, unless approved by the Lead Arrangers
in their reasonable discretion.
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     SECTION 5.1.4 PATRIOT Act Disclosures. Within five Business Days’ prior to
the Closing Date, the Lenders or the Lead Arrangers shall have received copies
of all PATRIOT Act Disclosures as reasonably requested by the Lenders or the
Lead Arrangers.
     SECTION 5.1.5 Delivery of Notes. The Administrative Agent shall have
received, for the account of each Lender that has requested a Note, such
Lender’s Notes duly executed and delivered by an Authorized Officer of the
Borrower.
     SECTION 5.1.6 Financial Information, etc. The Lead Arrangers shall have
received,
     (a) audited consolidated balance sheets and related statements of income,
stockholders’ equity and cash flows of (i) the Borrower and its Subsidiaries as
at July 2, 2003, July 2, 2004 and July 2, 2005;
     (b) unaudited consolidated balance sheets and related statements of income,
stockholders’ equity and cash flows for the 39-week period ended April 1, 2006;
     (c) a pro forma consolidated balance sheet and related pro forma
consolidated statements of income and cash flows as of and for the twelve-month
period ending at the most recent Fiscal Quarter ending at least 45 days prior to
the Closing Date, prepared after giving effect to the Transaction as if the
Transaction had occurred as of such date (in the case of such balance sheet) or
at the beginning of such period (in the case of such other financial
statements), in each case which financial statements shall not be materially
inconsistent with the financial statements or forecasts previously provided to
the Lenders; and
     (d) detailed projected financial statements of the Borrower and its
Subsidiaries for the seven Fiscal Years ended after the Closing Date, which
projections shall include quarterly projections for the first two Fiscal Years
after the Closing Date.
     SECTION 5.1.7 Compliance Certificate. The Lead Arrangers shall have
received an initial Compliance Certificate on a pro forma basis as if the
Transaction had been consummated and the initial Credit Extension had been made
as of April 1, 2006 and as to such items therein as the Lead Arrangers
reasonably request, dated the date of the initial Credit Extension, duly
executed (and with all schedules thereto duly completed) and delivered by the
chief financial or accounting Authorized Officer of the Borrower which
Compliance Certificate shall set forth such items therein as the Lead Arrangers
may reasonably request, including demonstrating that the Borrower’s pro forma
Leverage Ratio is not greater than 4.80:1.00.
     SECTION 5.1.8 Guaranty. The Lead Arrangers shall have received counterparts
of the Guaranty, dated as of the Closing Date, duly executed and delivered by an
Authorized Officer of each U.S. Subsidiary.
     SECTION 5.1.9 Security Agreement; Intercreditor Agreement.
     (a) The Lead Arrangers shall have received executed counterparts of the
Security Agreement, dated as of the Closing Date, duly executed, authorized or
delivered by each Obligor, as applicable, together with
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     (i) certificates (in the case of Capital Securities that are securities (as
defined in the UCC)) evidencing all of the issued and outstanding Capital
Securities owned by each Obligor in its U.S. Subsidiaries and, subject to
Section 7.1.11, 65% of the issued and outstanding Voting Securities (to the
extent certificated and permitted by applicable law to be removed from any
particular jurisdiction) of each Foreign Subsidiary (together with all the
issued and outstanding non-voting Capital Securities (to the extent certificated
and permitted by applicable law to be removed from any particular jurisdiction)
of such Foreign Subsidiary) directly owned by each Obligor, which certificates
in each case shall be accompanied by undated instruments of transfer duly
executed in blank, or, if any Capital Securities (in the case of Capital
Securities that are uncertificated securities (as defined in the UCC)),
confirmation and evidence reasonably satisfactory to the Lead Arrangers that the
security interest therein has been transferred to and perfected by the
Collateral Agent for the benefit of the Secured Parties in accordance with
Articles 8 and 9 of the UCC and all U.S. laws otherwise applicable to the
perfection of the pledge of such Capital Securities;
     (ii) Filing Statements suitable in form and naming each Obligor as a debtor
and the Collateral Agent as the secured party, or other similar instruments or
documents to be filed under the UCC of all jurisdictions as may be necessary or,
in the opinion of the Lead Arrangers, desirable to perfect the security
interests of the Collateral Agent pursuant to the Security Agreement;
     (iii) UCC Form UCC-3 termination statements, if any, necessary to release
all Liens and other rights of any Person in any collateral described in any
security agreement previously granted by any Person, together with such other
UCC Form UCC-3 termination statements as the Lead Arrangers may reasonably
request from such Obligors; and
     (iv) certified copies of UCC Requests for Information or Copies (Form
UCC-11), or a similar search report certified by a party reasonably acceptable
to the Lead Arrangers, dated a date reasonably near to the Closing Date, listing
all effective financing statements which name any Obligor (under its present
legal name) as the debtor, together with copies of such financing statements
(none of which shall evidence a Lien on any collateral described in any Loan
Document, other than a Permitted Lien).
     (b) The Lead Arrangers shall have received the Intercreditor Agreement,
executed and delivered by the Second Lien Collateral Agent.
     SECTION 5.1.10 Intellectual Property Security Agreements. The
Administrative Agent shall have received a Patent Security Agreement, a
Copyright Security Agreement and a Trademark Security Agreement, as applicable,
each dated as of the Closing Date, duly executed and delivered by each Obligor
that, pursuant to the Security Agreement, is required to provide such
intellectual property security agreements to the Collateral Agent.
     SECTION 5.1.11 Filing Agent, etc. All Uniform Commercial Code financing
statements or other similar financing statements and Uniform Commercial Code
(Form UCC-3) termination statements (collectively, the “Filing Statements”)
required pursuant to the Loan Documents shall
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have been delivered by counsel to the Lead Arrangers to CT Corporation System or
another similar filing service company acceptable to the Lead Arrangers (the
“Filing Agent”). The Filing Agent shall have acknowledged in a writing
satisfactory to the Lead Arrangers and their counsel (i) the Filing Agent’s
receipt of all Filing Statements, (ii) that the Filing Statements required
pursuant to the Loan Documents, have either been submitted for filing in the
appropriate filing offices or will be submitted for filing in the appropriate
offices within ten days following the Closing Date and (iii) that the Filing
Agent will notify the Agents and their counsel of the results of such
submissions and will provide recorded copies of the same within 30 days
following the Closing Date.
     SECTION 5.1.12 Insurance. The Lead Arrangers and the Collateral Agent shall
have received, certificates of insurance in form and substance reasonably
satisfactory to the Lead Arrangers, evidencing coverage required to be
maintained pursuant to each Loan Document and naming the Collateral Agent as
loss payee or additional insured, as applicable.
     SECTION 5.1.13 Opinions of Counsel. The Lead Arrangers shall have received
opinions, dated the Closing Date and addressed to the Lead Arrangers, the Agents
and all Lenders, from
     (a) Kirkland & Ellis LLP, counsel to the Obligors, in form and substance
reasonably satisfactory to the Lead Arrangers; and
     (b) Maryland counsel to the Borrower, in form and substance, and from
counsel, reasonably satisfactory to the Lead Arrangers.
     SECTION 5.1.14 Closing Fees, Expenses, etc. The Lead Arrangers shall have
received for its own account, or for the account of each Lender, as the case may
be, all fees, costs and expenses due and payable pursuant to Sections 3.3 and,
if then invoiced, 10.3.
     SECTION 5.1.15 Form 10. The financial information concerning the Branded
Apparel Business and the Borrower and its Subsidiaries and the management,
corporate and legal structure of the Borrower and each of the Subsidiary
Guarantors contained in the Borrower’s Form 10 filed with the Securities and
Exchange Commission in connection with the Spin-Off, including all amendments
and modifications thereto, shall be consistent in all material respects with the
information previously provided to the Lead Arrangers and the other Lenders.
     SECTION 5.1.16 Litigation. There shall exist no action, suit, investigation
or other proceeding pending or threatened in writing in any court or before any
arbitrator or governmental or regulatory agency or authority that could
reasonably be expected to have a Material Adverse Effect.
     SECTION 5.1.17 Approval. All material and necessary governmental and third
party consents and approvals shall have been obtained (without the imposition of
any material and adverse conditions that are not reasonably acceptable to the
Lenders) and shall remain in effect and all applicable waiting periods shall
have expired without any material and adverse action being taken by any
competent authority. The Lead Arrangers shall be reasonably satisfied that the
Spin-Off is to be consummated and the Dividend issued, in each case in
accordance with applicable laws and governmental regulations.
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     SECTION 5.1.18 Debt Rating. The Borrower shall have obtained a senior
secured debt rating (of any level) in respect of the Loans from each of S&P and
Moody’s, which ratings (of any level) shall remain in effect on the Closing
Date.
     SECTION 5.1.19 Satisfactory Legal Form. All documents executed or submitted
pursuant hereto by or on behalf of any Obligor on or before the Closing Date
shall be reasonably satisfactory in form and substance to the Lead Arrangers,
and the Lead Arrangers shall have received all information, approvals, opinions,
documents or instruments as the Lead Arrangers or their counsel may reasonably
request.
     SECTION 5.2 All Credit Extensions. The obligation of each Lender and each
Issuer to make any Credit Extension shall be subject to the satisfaction of each
of the conditions precedent set forth below.
     SECTION 5.2.1 Compliance with Warranties, No Default, etc. Both before and
after giving effect to any Credit Extension (but, if any Default of the nature
referred to in Section 8.1.5 shall have occurred with respect to any other
Indebtedness, without giving effect to the application, directly or indirectly,
of the proceeds thereof) the following statements shall be true and correct:
     (a) the representations and warranties set forth in each Loan Document
shall, in each case, be true and correct in all material respects with the same
effect as if then made (unless stated to relate solely to an earlier date, in
which case such representations and warranties shall be true and correct in all
material respects as of such earlier date); and
     (b) no Default shall have then occurred and be continuing.
     SECTION 5.2.2 Credit Extension Request, etc. Subject to Section 2.3.2, the
Administrative Agent shall have received a Borrowing Request if Loans are being
requested, or an Issuance Request if a Letter of Credit is being requested or
extended. Each of the delivery of a Borrowing Request or Issuance Request and
the acceptance by the Borrower of the proceeds of such Credit Extension shall
constitute a representation and warranty by the Borrower that on the date of
such Credit Extension (both immediately before and after giving effect to such
Credit Extension and the application of the proceeds thereof) the statements
made in Section 5.2.1 are true and correct.
ARTICLE VI
REPRESENTATIONS AND WARRANTIES
     In order to induce the Secured Parties to enter into this Agreement and to
make Credit Extensions hereunder, the Borrower represents and warrants to each
Secured Party, after giving effect to the consummation of the IP Purchase and
the Spin Off, as set forth in this Article.
     SECTION 6.1 Organization, etc. Each Obligor (i) is validly organized and
existing and in good standing under the laws of the state or jurisdiction of its
incorporation or organization, (ii) is duly qualified to do business and is in
good standing as a foreign entity in each jurisdiction where the nature of its
business requires such qualification, except where the failure to be so
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qualified or in good standing could not reasonably be expected to have a
Material Adverse Effect and (iii) has full organizational power and authority
and holds all requisite governmental licenses, permits and other approvals to
enter into and perform its Obligations under each Loan Document to which it is a
party, and except to the extent the failure to do so could not reasonably be
expected to have a Material Adverse Effect, to (a) own and hold under lease its
property and (b) to conduct its business substantially as currently conducted by
it.
     SECTION 6.2 Due Authorization, Non-Contravention, etc. The execution,
delivery and performance by each Obligor of each Loan Document executed or to be
executed by it, each Obligor’s participation in the consummation of all aspects
of the Transaction, and the execution, delivery and performance by the Borrower
or (if applicable) any Obligor of the agreements executed and delivered by it in
connection with the Transaction are in each case within such Person’s powers,
have been duly authorized by all necessary action, and do not
     (a) contravene any (i) Obligor’s Organic Documents, (ii) court decree or
order binding on or affecting any Obligor or (iii) law or governmental
regulation binding on or affecting any Obligor; or
     (b) result in (i) or require the creation or imposition of, any Lien on any
Obligor’s properties (except as permitted by this Agreement) or (ii) a default
under any material contractual restriction binding on or affecting any Obligor.
     SECTION 6.3 Government Approval, Regulation, etc. No authorization or
approval or other action by, and no notice to or filing with, any Governmental
Authority or other Person (other than those that have been, or on the Closing
Date will be, duly obtained or made and which are, or on the Closing Date will
be, in full force and effect) is required for the consummation of the
Transaction or the due execution, delivery or performance by any Obligor of any
Loan Document to which it is a party, or for the due execution, delivery and/or
performance of Transaction Documents, in each case by the parties thereto or the
consummation of the Transaction. Neither the Borrower nor any of its
Subsidiaries is an “investment company” within the meaning of the Investment
Company Act of 1940, as amended.
     SECTION 6.4 Validity, etc. Each Obligor has duly executed and delivered
each of the Loan Documents and each of the Transaction Documents to which it is
a party, and each Loan Document and each Transaction Document to which any
Obligor is a party constitutes the legal, valid and binding obligations of such
Obligor, enforceable against such Obligor in accordance with their respective
terms (except, in any case, as such enforceability may be limited by applicable
bankruptcy, insolvency, reorganization or similar laws affecting creditors’
rights generally and by principles of equity).
     SECTION 6.5 Financial Information. The financial statements of the Borrower
and its Subsidiaries furnished to the Administrative Agent and each Lender
pursuant to Section 5.1.6 (other than forecasts, projections, budgets and
forward-looking information) have been prepared in accordance with GAAP
consistently applied (except where specifically so noted on such financial
statements), and present fairly in all material respects the consolidated
financial condition of the Persons covered thereby as at the dates thereof and
the results of their operations for the periods then ended. All balance sheets,
all statements of income and of cash flow and all
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other financial information of each of the Borrower and its Subsidiaries
furnished pursuant to Section 7.1.1 have been and will for periods following the
Closing Date be prepared in accordance with GAAP consistently applied with the
financial statements delivered pursuant to Section 5.1.6, and do or will present
fairly in all material respects the consolidated financial condition of the
Persons covered thereby as at the dates thereof and the results of their
operations for the periods then ended. Notwithstanding anything contained herein
to the contrary, it is hereby acknowledged and agreed by the Administrative
Agent, each Lead Arranger and each Lender that (i) any financial or business
projections furnished to the Administrative Agent, any Lead Arranger or any
Lender by the Borrower or any of its Subsidiaries under any Loan Document are
subject to significant uncertainties and contingencies, which may be beyond the
Borrower’s and/or its Subsidiaries’ control, (ii) no assurance is given by any
of the Borrower or its Subsidiaries that the results forecast in any such
projections will be realized and (iii) the actual results may differ from the
forecast results set forth in such projections and such differences may be
material.
     SECTION 6.6 No Material Adverse Change. There has been no material adverse
change in the business, financial condition, operations, performance or assets
of the Borrower and its Subsidiaries, taken as a whole, since July 2, 2005.
     SECTION 6.7 Litigation, Labor Controversies, etc. There is no pending or,
to the knowledge of the Borrower or any of its Subsidiaries, threatened (in
writing) litigation, action, proceeding, labor controversy or investigation:
     (a) affecting the Borrower any of its Subsidiaries or any other Obligor, or
any of their respective properties, businesses, assets or revenues, which could
reasonably be expected to have a Material Adverse Effect; or
     (b) which purports to affect the legality, validity or enforceability of
any Loan Document, the Transaction Documents or the Transaction.
     SECTION 6.8 Subsidiaries. The Borrower has no Subsidiaries, except those
Subsidiaries which are (a) identified in Item 6.8 of the Disclosure Schedule,
(b) permitted to have been organized or acquired in accordance with
Sections 7.2.5 or 7.2.10 or (c) a Foreign Supply Chain Entity that has been
redesignated as a Foreign Subsidiary.
     SECTION 6.9 Ownership of Properties. The Borrower and each of its
Subsidiaries (other than a Receivables Subsidiary) owns (a) in the case of owned
real property, good and legal title to, (b) in the case of owned personal
property, good and valid title to, and (c) in the case of leased real or
personal property, valid and enforceable (subject to bankruptcy, insolvency,
reorganization or similar laws) leasehold interests (as the case may be) in, all
of its properties and assets, tangible and intangible, of any nature whatsoever,
free and clear in each case of all Liens or claims, except for Permitted Liens.
Set forth in Item 6.9 of the Disclosure Schedule is a true and complete list of
each Mortgaged Property.
     SECTION 6.10 Taxes. The Borrower and each of its Subsidiaries has filed all
material tax returns and reports required by law to have been filed by it and
has paid all Taxes thereby shown to be due and owing, except any such Taxes
which are being diligently contested in good
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faith by appropriate proceedings and for which adequate reserves in accordance
with GAAP shall have been set aside on its books or except to the extent such
failure could not reasonably be expected to result in a Material Adverse Effect.
     SECTION 6.11 Pension and Welfare Plans. During the twelve-consecutive-month
period prior to the Closing Date and prior to the date of any Credit Extension
hereunder, no steps have been taken to terminate any Pension Plan which has
caused or could reasonably be expected to cause Borrower or any Subsidiary to
incur any liability, and no contribution failure has occurred with respect to
any Pension Plan sufficient to give rise to a Lien under Section 302(f) of ERISA
with respect to any assets of Borrower or any Subsidiary. No condition exists or
event or transaction has occurred with respect to any Pension Plan which might
result in the incurrence by the Borrower of any material liability, fine or
penalty.
     SECTION 6.12 Environmental Warranties.
     (a) All facilities and property (including underlying groundwater) owned or
leased by the Borrower or any of its Subsidiaries have been, and continue to be,
owned or leased by the Borrower and its Subsidiaries in compliance with all
Environmental Laws, except for any such noncompliance which could not reasonably
be expected to have a Material Adverse Effect;
     (b) there have been no past, and there are no pending or, to the Borrower’s
knowledge (after due inquiry), threatened (in writing) (i) claims, complaints,
notices or requests for information received by the Borrower or any of its
Subsidiaries with respect to any alleged violation of any Environmental Law, or
(ii) complaints, notices or inquiries to the Borrower or any of its Subsidiaries
regarding potential liability under any Environmental Law except for claims,
complaints, notices, requests for information or inquiries with respect to
violations of or potential liability under any Environmental Laws that could not
reasonably be expected to have a Material Adverse Effect;
     (c) there have been no Releases of Hazardous Materials at, on or under any
property now or previously owned, operated or leased by the Borrower or any of
its Subsidiaries that have had, or could reasonably be expected to have, a
Material Adverse Effect;
     (d) the Borrower and its Subsidiaries have been issued and are in
compliance with all permits, certificates, approvals, licenses and other
authorizations relating to environmental matters, except for any such
non-issuance or any such noncompliance which could not reasonably be expected to
have a Material Adverse Effect;
     (e) no property now or, to the Borrower’s knowledge (after due inquiry),
previously owned, operated or leased by the Borrower or any of its Subsidiaries
is listed or proposed for listing (with respect to owned, operated property
only) on the National Priorities List pursuant to CERCLA, on the CERCLIS or on
any similar state list of sites requiring investigation or clean-up, which
listing could reasonably be expected to have a Material Adverse Effect;
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     (f) there are no underground storage tanks, active or abandoned, including
petroleum storage tanks, on or under any property now or previously owned,
operated or leased by the Borrower or any of its Subsidiaries that, singly or in
the aggregate, have, or could reasonably be expected to have, a Material Adverse
Effect;
     (g) neither the Borrower nor any Subsidiary has directly transported or
directly arranged for the transportation of any Hazardous Material to any
location which is listed or proposed for listing on the National Priorities List
pursuant to CERCLA, on the CERCLIS or on any similar state list or which is the
subject of federal, state or local enforcement actions or other investigations
which could reasonably be expected to lead to material claims against the
Borrower or such Subsidiary for any remedial work, damage to natural resources
or personal injury, including claims under CERCLA which, if adversely resolved
could, in any of the foregoing cases, reasonably be expected to have a Material
Adverse Effect;
     (h) there are no polychlorinated biphenyls or friable asbestos present at
any property now or previously owned, operated or leased by the Borrower or any
Subsidiary that, singly or in the aggregate, have, or could reasonably be
expected to have, a Material Adverse Effect; and
     (i) no conditions exist at, on or under any property now or, to the
knowledge of the Borrower (after due inquiry), previously owned, operated or
leased by the Borrower which, with the passage of time, or the giving of notice
or both, would give rise to liability under any Environmental Law, except for
such liability that could not reasonably be expected to have a Material Adverse
Effect.
     SECTION 6.13 Accuracy of Information. None of the factual information
(other than projections, forecasts, budgets and forward-looking information)
heretofore or contemporaneously furnished in writing to any Secured Party by or
on behalf of any Obligor in connection with any Loan Document or any transaction
contemplated hereby (including the Transaction) (taken as a whole) contains any
untrue statement of a material fact, or omits to state any material fact
necessary to make any such information not materially misleading as of the date
such information was furnished; provided, however (i) any financial or business
projections furnished to the Administrative Agent, any Lead Arranger or any
Lender by the Borrower or any of its Subsidiaries under any Loan Document are
subject to significant uncertainties and contingencies, which may be beyond the
Borrower’s and/or its Subsidiaries’ control, (ii) no assurance is given by any
of the Borrower or its Subsidiaries that the results forecast in any such
projections will be realized and (iii) the actual results may differ from the
forecast results set forth in such projections and such differences may be
material.
     SECTION 6.14 Regulations U and X. No Obligor is engaged in the business of
extending credit for the purpose of buying or carrying margin stock, and no
proceeds of any Credit Extensions will be used to purchase or carry margin stock
or otherwise for a purpose which violates, or would be inconsistent with, F.R.S.
Board Regulation U or Regulation X. Terms for which meanings are provided in
F.R.S. Board Regulation U or Regulation X or any regulations substituted
therefor, as from time to time in effect, are used in this Section with such
meanings.
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     SECTION 6.15 Compliance with Contracts, Laws, etc. The Borrower and each of
its Subsidiaries have performed their obligations under agreements to which the
Borrower or a Subsidiary is a party and have complied with all applicable laws,
rules, regulations and orders except were the failure to do so could not
reasonably be expected to have a Material Adverse Effect. The Borrower and each
of its Subsidiaries (a) are not listed on the “Specially Designated Nationals
and Blocked Person List” maintained by the Office of Foreign Assets Control
(“OFAC”), the Department of the Treasury, or included in any executive orders
relating thereto and (b) have used the proceeds of the Credit Extensions without
violating in any material respect any of the foreign asset control regulations
of OFAC or any enabling statute or executive order relating thereto having the
force of law.
     SECTION 6.16 Solvency. The Borrower and its Subsidiaries (taken as a
whole), both before and after giving effect to any Credit Extensions, are
Solvent.
ARTICLE VII
COVENANTS
     SECTION 7.1 Affirmative Covenants. The Borrower agrees with each Lender,
each Issuer and each Agent that until the Termination Date has occurred, the
Borrower will, and will cause its Subsidiaries to, perform or cause to be
performed the obligations set forth below.
     SECTION 7.1.1 Financial Information, Reports, Notices, etc. The Borrower
will furnish each Lender and the Administrative Agent copies of the following
financial statements, reports, notices and information:
     (a) within the earlier of (i) 45 days after the end of each of the first
three Fiscal Quarters of each Fiscal Year and (ii) so long as the Borrower is a
public reporting company at such time, such earlier date as the SEC requires the
filing of such information (or if the Borrower is required to file such
information on a Form 10-Q with the SEC, promptly following such filing), an
unaudited consolidated balance sheet of the Borrower and its Subsidiaries as of
the end of such Fiscal Quarter and consolidated statements of income and cash
flow of the Borrower and its Subsidiaries for such Fiscal Quarter and for the
period commencing at the end of the previous Fiscal Year and ending with the end
of such Fiscal Quarter, and including (in each case), in comparative form, the
figures for the corresponding Fiscal Quarter in, and year to date portion of,
the immediately preceding Fiscal Year, certified as complete and correct in all
material respects (subject to audit, normal year-end adjustments and the absence
of footnote disclosure) by the chief financial officer, chief executive officer,
president, treasurer or assistant treasurer of the Borrower;
     (b) within the earlier of (i) 90 days after the end of each Fiscal Year and
(ii) so long as the Borrower is a public reporting company at such time, such
earlier date as the SEC requires the filing of such information (or if the
Borrower is required to file such information on a Form 10-K with the SEC,
promptly following such filing), (i) a copy of the consolidated balance sheet of
the Borrower and its Subsidiaries, and the related consolidated statements of
income and cash flow of the Borrower and its Subsidiaries for such Fiscal Year,
setting forth in comparative form the figures for the immediately
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preceding Fiscal Year, audited (without any Impermissible Qualification) by
Pricewaterhouse Coopers LLP or such other independent public accountants
selected by the Borrower and reasonably acceptable to the Administrative Agent,
which shall include a calculation of the financial covenants set forth in
Section 7.2.4 and stating that, in performing the examination necessary to
deliver the audited financial statements of the Borrower, no knowledge was
obtained of any Event of Default with respect to financial matters and (ii) a
consolidated budget (within level of detail comparable to the quarterly
financial statements delivered pursuant to clause (a)) for the following Fiscal
Year including a projected consolidated balance sheet and related statements of
projected operations and cash flows as of the end of and for such following
Fiscal Year;
     (c) concurrently with the delivery of the financial information pursuant to
clauses (a) and (b), a Compliance Certificate, executed by the chief financial
officer, chief executive officer, president, treasurer or assistant treasurer of
the Borrower, (i) showing compliance with the financial covenants set forth in
Section 7.2.4 and stating that no Default has occurred and is continuing (or, if
a Default has occurred, specifying the details of such Default and the action
that the Borrower or an Obligor has taken or proposes to take with respect
thereto), (ii) stating that no Subsidiary has been formed or acquired since the
delivery of the last Compliance Certificate (or, if a Subsidiary has been formed
or acquired since the delivery of the last Compliance Certificate, a statement
that such Subsidiary has complied with Section 7.1.8 if applicable) and (iii) in
the case of a Compliance Certificate delivered concurrently with the financial
information pursuant to clause (b), a calculation of Excess Cash Flow;
     (d) as soon as possible and in any event within three Business Days after
the Borrower or any other Obligor obtains knowledge of the occurrence of a
Default, a statement of an Authorized Officer on behalf of the Borrower setting
forth details of such Default and the action which the Borrower or such Obligor
has taken and proposes to take with respect thereto;
     (e) as soon as possible and in any event within three Business Days after
the Borrower or any other Obligor obtains knowledge of (i) the commencement of
any litigation, action, proceeding or labor controversy of the type and
materiality described in Section 6.7 or (ii) any other event, change or
circumstance that has had, or could reasonably be expected to have, a Material
Adverse Effect, notice thereof and, to the extent the Administrative Agent
requests, copies of all documentation relating thereto, if any;
     (f) within three Business Days after the sending or filing thereof, copies
of all reports, notices, prospectuses and registration statements which any
Obligor files with the SEC or any national securities exchange; provided that
such delivery shall be deemed to have been made upon delivery of notice to the
Administrative Agent that such statements or reports are available on the
Internet via the EDGAR system of the SEC;
     (g) promptly upon becoming aware of (i) the institution of any steps by any
Person to terminate any Pension Plan, (ii) the failure to make a required
contribution to any Pension Plan if such failure is sufficient to give rise to a
Lien under Section 302(f) of
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ERISA, (iii) the taking of any action with respect to a Pension Plan which could
result in the requirement that any Obligor furnish a bond or other security to
the PBGC or such Pension Plan, or (iv) the occurrence of any event with respect
to any Pension Plan which could reasonably be expected to result in the
incurrence by any Obligor of any material liability, fine or penalty, notice
thereof and copies of all documentation relating thereto;
     (h) promptly upon receipt thereof, copies of all final “management letters”
submitted to the Borrower or any other Obligor by the independent public
accountants referred to in clause (b) in connection with each audit made by such
accountants;
     (i) promptly following the mailing or receipt of any notice or report
(other than identical reports or notices delivered hereunder) delivered under
the terms of the Second Lien Loan Documents, or the Bridge Loan Documents, or
the Senior Note Documents, copies of such notice or report;
     (j) all PATRIOT Act Disclosures, to the extent reasonably requested by the
Administrative Agent or any Lender; and
     (k) such other financial and other information as any Lender or Issuer
through the Administrative Agent may from time to time reasonably request
(including information and reports in such detail as the Administrative Agent
may request with respect to the terms of and information provided pursuant to
the Compliance Certificate).
Information required to be delivered pursuant to clauses (a) and (b) of
Section 7.1.1 shall be deemed to have been delivered to the Administrative Agent
on the date on which the Borrower provides written notice to the Administrative
Agent that such information is available on the Internet via the EDGAR system of
the SEC (to the extent such information is available as described in such
notice). Information required to be delivered pursuant to this Section 7.1.1 may
also be delivered by electronic communication pursuant to procedures approved by
the Administrative Agent pursuant to Section 9.11.
     SECTION 7.1.2 Maintenance of Existence; Material Obligations; Compliance
with Contracts, Laws, etc. The Borrower will, and will cause each of its
Subsidiaries to, preserve and maintain its legal existence, rights (charter and
statutory), franchises, permits, licenses and approvals (in each case, except as
otherwise permitted by Section 7.2.10), perform in all respects their
obligations, including obligations under agreements to which the Borrower or a
Subsidiary is a party, and comply in all respects with all applicable laws,
rules, regulations and orders, including the payment (before the same become
delinquent), of all obligations, including all Taxes imposed upon the Borrower
or its Subsidiaries or upon their property except to the extent being diligently
contested in good faith by appropriate proceedings and for which adequate
reserves in accordance with GAAP have been set aside on the books of the
Borrower or its Subsidiaries, as applicable except, in each case, where the
failure to do so could not reasonably be expected to have a Material Adverse
Effect.
     SECTION 7.1.3 Maintenance of Properties. Except to the extent that the
failure to do so could not reasonably be expected to have a Material Adverse
Effect the Borrower will, and will
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cause each of its Subsidiaries to, maintain, preserve, protect and keep its and
their respective properties in good repair, working order and condition
(ordinary wear and tear, casualty and condemnation excepted), and make necessary
repairs, renewals and replacements so that the business carried on by the
Borrower and its Subsidiaries may be properly conducted at all times, unless the
Borrower or such Subsidiary determines in good faith that the continued
maintenance of such property is no longer economically desirable, necessary or
useful to the business of the Borrower or any of its Subsidiaries or the
Disposition of such property is otherwise permitted by Sections 7.2.10 or
7.2.11.
     SECTION 7.1.4 Insurance. The Borrower will, and will cause each of its
Subsidiaries to maintain:
     (a) insurance on its property with financially sound and reputable
insurance companies against loss and damage in at least the amounts (and with
only those deductibles) customarily maintained, and against such risks as are
typically insured against in the same general area, by Persons of comparable
size engaged in the same or similar business as the Borrower and its
Subsidiaries; and
     (b) all worker’s compensation, employer’s liability insurance or similar
insurance as may be required under the laws of any state or jurisdiction in
which it may be engaged in business.
Without limiting the foregoing, all insurance policies required pursuant to this
Section shall (i) name the Collateral Agent on behalf of the Secured Parties as
mortgagee (in the case of property insurance) or additional insured (in the case
of liability insurance), as applicable, and provide that no cancellation or
modification of the policies will be made without thirty days’ prior written
notice to the Collateral Agent and (ii) without duplication, be in addition to
any requirements to maintain specific types of insurance contained in the other
Loan Documents.
     SECTION 7.1.5 Books and Records. The Borrower will, and will cause each of
its Subsidiaries to, keep books and records in accordance with GAAP which
accurately reflect in all material respects all of its business affairs and
transactions and permit each Secured Party or any of their respective
representatives, at reasonable times during normal business hours and intervals
upon reasonable notice to the Borrower and except after the occurrence and
during the continuance of an Event of Default not more frequently than once per
Fiscal Year, to visit each Obligor’s offices, to discuss such Obligor’s
financial matters with its officers and employees, and its independent public
accountants (provided that management of the Borrower shall be notified and
allowed to be present at all such meetings and the Borrower hereby authorizes
such independent public accountant to discuss each Obligor’s financial matters
with each Secured Party or their representatives) and to examine (and photocopy
extracts from) any of its books and records. The Borrower shall pay any
reasonable fees of such independent public accountant incurred in connection
with any Secured Party’s exercise of its rights pursuant to this Section.
     SECTION 7.1.6 Environmental Law Covenant. The Borrower will, and will cause
each of its Subsidiaries to:
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     (a) use and operate all of its and their facilities and properties in
compliance with all Environmental Laws, keep all permits, approvals,
certificates, licenses and other authorizations required under Environmental
Laws in effect and remain in compliance therewith, and handle all Hazardous
Materials in compliance with all applicable Environmental Laws, in each case
except where failure to do so could not reasonably be expected to have a
Material Adverse Effect; and
     (b) promptly notify the Administrative Agent and provide copies upon
receipt of all written claims, complaints, notices or inquiries relating to the
condition of its facilities and properties in respect of, or as to compliance
with, Environmental Laws, the subject matter of which could reasonably be
expected to have a Material Adverse Effect, and shall promptly resolve any
non-compliance with Environmental Laws (except as could not reasonably be
expected to have a Material Adverse Effect) and keep its property free of any
Lien imposed by any Environmental Law.
     SECTION 7.1.7 Use of Proceeds. The Borrower will apply the proceeds of the
Credit Extensions as follows:
     (a) to finance, in part, the Transaction including the Dividend, and to pay
the fees, costs and expenses related to the Transaction;
     (b) for working capital and general corporate purposes of the Borrower and
the Subsidiary Guarantors; and
     (c) for issuing Letters of Credit for the account of the Borrower and the
Subsidiary Guarantors for purposes referred to in clause (b) above.
     SECTION 7.1.8 Future Guarantors, Security, etc. Subject to Section 7.1.11,
the Borrower will, and will cause each U.S. Subsidiary to, execute any
documents, authorize the filing of Filing Statements, execute agreements and
instruments, and take all commercially reasonable further action (including
filing Mortgages to the extent required hereby) that may be required under
applicable law, or that the Administrative Agent may reasonably request, in
order to effectuate the transactions contemplated by the Loan Documents and in
order to grant, preserve, protect and perfect the validity and first priority
(subject to Permitted Liens) of the Liens created or intended to be created by
the Loan Documents. The Borrower will cause any subsequently acquired or
organized U.S. Subsidiary to execute a supplement (in form and substance
reasonably satisfactory to the Administrative Agent) to the Guaranty and each
other applicable Loan Document in favor of the Secured Parties. In addition,
from time to time, the Borrower will, at its own cost and expense, promptly
secure the Obligations by pledging or creating, or causing to be pledged or
created, perfected Liens with respect to such of its assets and properties as
the Administrative Agent or the Required Lenders shall designate, it being
agreed that it is the intent of the parties that the Obligations shall be
secured by, among other things, substantially all the assets of the Borrower and
its U.S. Subsidiaries and personal property acquired subsequent to the Closing
Date; provided that (a) neither the Borrower nor its U.S. Subsidiaries shall be
required to pledge more than 65% of the Voting Securities of any Foreign
Subsidiary that is directly owned by any Obligor, (b) neither the Borrower nor
any U.S. Subsidiary shall be required to create or perfect any security interest
in any leased real property
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or any owned real property with a fair market value (as determined by the
Borrower in good faith) less than $2,000,000, (c) to the extent the Organic
Documents of a Foreign Supply Chain Entity (regardless of a redesignation as a
Foreign Subsidiary) prohibit the creation or perfection of a security interest
in the Capital Securities of such Foreign Supply Chain Entity, no Obligor will
be required to create or perfect a security interest in such Capital Securities
and (d) the Borrower will not be required to execute and deliver any Foreign
Pledge Agreement with respect to any Foreign Subsidiary (i) whose assets are
valued (as reasonably determined by the Borrower) at less than $25,000,000 or
(ii) if the Borrower and the Administrative Agent reasonably determine that it
is commercially impractical to deliver a Foreign Pledge Agreement in such
jurisdiction. Such Liens will be created under the Loan Documents in form and
substance reasonably satisfactory to the Agents, and the Borrower shall deliver
or cause to be delivered to the Agents all such instruments and documents
(including legal opinions, title insurance policies and lien searches) as the
Administrative Agent shall reasonably request to evidence compliance with this
Section.
     SECTION 7.1.9 Rate Protection Agreements. Within 60 days following the
Closing Date, the Borrower and/or the IP Subsidiary will enter into interest
rate swap, cap, collar or similar arrangements with a Lender, Second Lien Lender
or any other Person reasonably acceptable to the Lenders designed to protect the
Borrower and/or the IP Subsidiary against fluctuations in interest rates for a
period of at least three years from the Closing Date, in an amount that would
cause not less than 50% of the Indebtedness outstanding under the Loan
Documents, the Second Lien Loan Documents, the Bridge Loan Documents and the
Senior Note Documents to bear interest at a fixed rate.
     SECTION 7.1.10 Maintenance of Ratings. The Borrower will use its
commercially reasonable efforts to cause a senior secured credit rating with
respect to the Loans from each of S&P and Moody’s to be available at all times
until the Stated Maturity Date for the Term B Loans.
     SECTION 7.1.11 Post-Closing Obligations.
     (a) Foreign Pledge Agreements. Within 90 days after the Closing Date (or
such later dates from time to time as consented to by the Administrative Agent
in its reasonable discretion), all Foreign Pledge Agreements shall have been
duly executed and delivered by all parties thereto and shall remain in full
force and effect, and all Liens granted to the Collateral Agent thereunder shall
be duly perfected to provide the Collateral Agent with a security interest in
and Lien on all collateral granted thereunder free and clear of other Liens,
except to the extent reasonably consented to by the Administrative Agent;
provided that the Administrative Agent may waive the requirement to perfect a
pledge on the Capital Securities of any Foreign Subsidiary otherwise required to
be pledged hereunder if they determine, in their reasonable discretion, that the
value of the assets owned by such Foreign Subsidiary or the EBITDA generated by
such Foreign Subsidiary, is immaterial when taken as a whole.
     (b) Mortgages. Subject to the limitation in clause (d) of Section 7.1.8,
within 90 days after the Closing Date (or such later dates from time to time as
consented to by the Administrative Agent in its reasonable discretion), the
Agents shall have received
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counterparts of each Mortgage with respect to a Mortgaged Property, duly
executed and delivered by the applicable Obligor, together with:
     (i) evidence of the completion (or reasonably satisfactory arrangements for
the completion) of all recordings and filings of each Mortgage as necessary to
create a valid, perfected first priority (subject to Permitted Liens) Lien
against the properties purported to be covered thereby;
     (ii) mortgagee’s title insurance policies in favor of the Collateral Agent
for the benefit of the Secured Parties in amounts not exceeding the fair market
value of the insured property and in form and substance and issued by insurers,
reasonably satisfactory to the Lead Arrangers, with respect to the property
purported to be covered by each Mortgage, insuring that title to such property
is marketable and that the interests created by each Mortgage constitute valid
first Liens thereon (subject to Permitted Liens), and, if required by the Lead
Arrangers and if available, shall include revolving credit endorsement,
comprehensive endorsement, variable rate endorsement, access and utilities
endorsements, mechanic’s lien endorsement and such other endorsements as the
Lead Arrangers shall reasonably request and shall be accompanied by evidence of
the payment in full of all premiums thereon; and
     (iii) mortgage releases releasing any mortgage in favor of any other Person
on any Mortgaged Property.
     (c) Excluded Contracts. The Borrower agrees to use commercially reasonable
efforts to cause the Excluded Contracts to become owned by the Borrower or the
applicable Subsidiary within 180 days of the Closing Date.
     (d) Foreign Stock Certificates. Within 10 Business Days following the
Closing Date (or such later dates from time to time as consented to by the
Administrative Agent in its reasonable discretion), the Borrower agrees to
deliver certificates (in each case accompanied by undated instruments of
transfer duly executed in blank) evidencing, 65% of the issued and outstanding
Voting Securities (to the extent certificated and permitted by applicable law to
be removed from any particular jurisdiction) of each Foreign Subsidiary
(together with all the issued and outstanding non-voting Capital Securities (to
the extent certificated and permitted by applicable law to be removed from any
particular jurisdiction) of such Foreign Subsidiary) directly owned by each
Obligor to the extent not previously delivered, together with a revised
Schedule I to the Security Agreement accurately reflecting the newly delivered
certificates.
     (e) Spin-Off Related Transfers. Within 180 days following the Closing Date
(or such later dates from time to time as consented to by the Administrative
Agent in its reasonable discretion), the Borrower will (i) cause Hanesbrands
Philippines, Inc.; HBI Sourcing Asia Limited; Sara Lee Apparel International
(Shanghai) Co. Ltd. (to be renamed Hanesbrands International (Shanghai) Co.
Ltd.); Sara Lee Apparel India Private Limited (to be renamed Hanesbrands India
Private Limited); and SL Sourcing India Private Ltd. (to be renamed HBI Sourcing
India Private Ltd.) to become Subsidiaries of
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the Borrower, (ii) own 50% of the issued and outstanding Capital Securities of
Playtex Marketing Corporation and (iii) consummate the transfer of assets
relating to the Branded Apparel Business from SL Hong Kong Ltd., Sara Lee
Philippines Inc. and Hanesbrands Philippines Inc. to Subsidiaries of the
Borrower. The Borrower represents and warrants that the fair market value of the
assets to be transferred pursuant to this clause have a fair market value of
less than $6,500,000.
     (f) NT Investment Company, Inc. Within three Business Days following the
Closing Date, the Borrower shall cause NT Investment Company, Inc. to be in good
standing (and deliver to the Administrative Agent a copy of the good standing
certificate) in the State of Delaware.
     SECTION 7.2 Negative Covenants. The Borrower covenants and agrees with each
Lender, each Issuer and each Agent that until the Termination Date has occurred,
the Borrower will, and will cause its Subsidiaries to, perform or cause to be
performed the obligations set forth below.
     SECTION 7.2.1 Business Activities; Accounting Policies. The Borrower will
not, and will not permit any of its Subsidiaries to, (a) engage in any business
activity except those business activities engaged in on the date of this
Agreement and activities reasonably related, supportive, complementary,
ancillary or incidental thereto or reasonable extensions thereof or (b) change
its accounting policies or financial reporting practices from such policies and
practices in effect of the Closing Date, including any change to the ending
dates with respect to the Borrower and its Subsidiaries’ Fiscal Year (except to
the extent set forth in the definition thereof) or Fiscal Quarters.
     SECTION 7.2.2 Indebtedness. The Borrower will not, and will not permit any
of its Subsidiaries to, create, incur, assume or permit to exist any
Indebtedness, other than:
     (a) Indebtedness in respect of the Obligations;
     (b) unsecured Indebtedness of the Obligors (i) under the Senior Note
Documents and the Bridge Loan Documents in an aggregate principal amount not to
exceed $500,000,000, as such amount is reduced on or after the Closing Date in
accordance with the terms hereof and (ii) under senior notes whether issued
pursuant to a supplement to the Senior Note Indenture or any other senior note
indenture, the terms of which are reasonably satisfactory to the Administrative
Agent, so long as (x) the aggregate principal amount thereunder does not exceed
$500,000,000 and (y) the proceeds therefor are applied to repay Loans in
accordance with clause (h) of Section 3.1.1;
     (c) Indebtedness existing as of the Closing Date which is identified in
Item 7.2.2(c) of the Disclosure Schedule, and refinancings, refundings,
reallocations, renewals or extensions of such Indebtedness in a principal amount
not in excess of that which is outstanding on the Closing Date (as such amount
has been reduced following the Closing Date);
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     (d) unsecured Indebtedness (i) incurred in the ordinary course of business
of the Borrower and its Subsidiaries (including open accounts extended by
suppliers on normal trade terms in connection with purchases of goods and
services which are not overdue for a period of more than 90 days or, if overdue
for more than 90 days, as to which a dispute exists and adequate reserves in
conformity with GAAP have been established on the books of the Borrower or such
Subsidiary) and (ii) in respect of performance, surety or appeal bonds provided
in the ordinary course of business, but excluding (in each case), Indebtedness
incurred through the borrowing of money or Contingent Liabilities of borrowed
money;
     (e) Indebtedness (i) in respect of industrial revenue bonds or other
similar governmental or municipal bonds, (ii) evidencing the deferred purchase
price of newly acquired property or incurred to finance the acquisition of
equipment of the Borrower and its Subsidiaries (pursuant to purchase money
mortgages or otherwise, whether owed to the seller or a third party) used in the
ordinary course of business of the Borrower and its Subsidiaries (provided that,
such Indebtedness is incurred within 270 days of the acquisition of such
property) and (iii) in respect of Capitalized Lease Liabilities; provided that,
the aggregate amount of all Indebtedness outstanding pursuant to this clause
shall not at any time exceed $150,000,000;
     (f) Indebtedness of (i) an Obligor owing to any other Obligor and of
(ii) any Subsidiary (other than a Receivables Subsidiary) that is not a
Subsidiary Guarantor or any Foreign Supply Chain Entity owing to an Obligor,
which Indebtedness (A) shall, if payable to the Borrower or a Subsidiary
Guarantor, not be discharged for any consideration other than payment in full or
in part in cash or through the conversion of such Indebtedness to equity
(provided that only the amount repaid in part shall be discharged); and
(B) shall not (when aggregated with the amount of Investments made by the
Borrower and the Subsidiary Guarantors in Subsidiaries which are not Subsidiary
Guarantors and in Foreign Supply Chain Entities under clause (e)(i) of
Section 7.2.5 and Indebtedness converted to equity pursuant to clause
(f)(ii)(A)), exceed $275,000,000 at any one time outstanding;
     (g) unsecured Indebtedness (not evidenced by a note or other instrument) of
an Obligor owing to a Subsidiary that is not a Subsidiary Guarantor and has
previously executed and delivered to the Administrative Agent the Interco
Subordination Agreement;
     (h) Indebtedness of the Obligors incurred pursuant to the terms of the
Second Lien Loan Documents in a principal amount not to exceed $450,000,000, as
such amount is reduced on or after the Closing Date in accordance with the terms
hereof;
     (i) Indebtedness of a Person existing at the time such Person became a
Subsidiary of the Borrower, but only if such Indebtedness was not created or
incurred in contemplation of such Person becoming a Subsidiary and the aggregate
outstanding amount of all Indebtedness existing pursuant to this clause does not
exceed $100,000,000 at any time;
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     (j) Indebtedness incurred pursuant to a Permitted Securitization and
Standard Securitization Undertakings;
     (k) unsecured Indebtedness of the Borrower and its Subsidiaries incurred to
(i) finance Permitted Acquisitions (including obligations of the Borrower and
its Subsidiaries under indemnification, adjustment of purchase price, earn-out,
incentive, non-compete, consulting, deferred compensation or other similar
arrangements incurred by such Person in connection therewith) or (ii) refinance
any other Indebtedness permitted to be incurred under clauses (a), (b), (e), (i)
and (n) of this Section 7.2.2;
     (l) Indebtedness in respect of Hedging Obligations entered into in the
ordinary course of business and not for speculative purposes;
     (m) Indebtedness of any Foreign Subsidiary owing to any other Foreign
Subsidiary;
     (n) Indebtedness (whether unsecured or secured by Liens) of Foreign
Subsidiaries in an aggregate outstanding principal amount not to exceed
$150,000,000 at any one time outstanding and Contingent Liabilities of any
Obligor in respect thereof;
     (o) Indebtedness incurred in the ordinary course of business in connection
with cash pooling arrangements, cash management and other Indebtedness incurred
in the ordinary course of business in respect of netting services, overdraft
protections and similar arrangements in each case in connection with cash
management and deposit accounts;
     (p) Indebtedness consisting of the financing of insurance premiums in the
ordinary course of business;
     (q) unsecured Indebtedness of Borrower and its Subsidiaries representing
the obligation of such Person to make payments with respect to the cancellation
or repurchase of Capital Securities of officers, employees or directors (or
their estates) of the Borrower or such Subsidiaries; and
     (r) other Indebtedness of the Borrower and its Subsidiaries (other than
Indebtedness of Foreign Subsidiaries owing to the Borrower or Subsidiary
Guarantors or of a Receivables Subsidiary) in an aggregate amount at any time
outstanding not to exceed $100,000,000;
provided that, no Indebtedness otherwise permitted by clauses (c), (e), (f)(ii),
(i), (k) or (r) shall be assumed, created or otherwise incurred if an Event of
Default has occurred and is then continuing.
     SECTION 7.2.3 Liens. The Borrower will not, and will not permit any of its
Subsidiaries to, create, incur, assume or permit to exist any Lien upon any of
its property (including Capital Securities of any Person), revenues or assets,
whether now owned or hereafter acquired, except the following (collectively
“Permitted Liens”):
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     (a) Liens securing payment of the Obligations;
     (b) Liens in connection with a Permitted Securitization;
     (c) Liens existing as of the Closing Date and disclosed in Item 7.2.3(c) of
the Disclosure Schedule securing Indebtedness described in clause (c) of Section
7.2.2, and refinancings, refundings, reallocations, renewals or extensions of
such Indebtedness; provided that, no such Lien shall encumber any additional
property (except for accessions to such property and the products and proceeds
thereof) and the amount of Indebtedness secured by such Lien is not increased
from that existing on the Closing Date;
     (d) Liens securing Indebtedness of the type permitted under clause (e) of
Section 7.2.2; provided that, (i) such Lien is granted within 270 days after
such Indebtedness is incurred, (ii) the Indebtedness secured thereby does not
exceed the lesser of the cost or the fair market value of the applicable
property, improvements or equipment at the time of such acquisition (or
construction) and (iii) such Lien secures only the assets that are the subject
of the Indebtedness referred to in such clause;
     (e) Liens securing Indebtedness permitted by clause (i) of Section 7.2.2;
provided that, such Liens existed prior to such Person becoming a Subsidiary,
were not created in anticipation thereof and attach only to specific tangible
assets of such Person;
     (f) Liens in favor of carriers, warehousemen, mechanics, repairmen,
materialmen, customs and revenue authorities and landlords and other similar
statutory Liens and Liens in favor of suppliers (including sellers of goods
pursuant to customary reservations or retention of title, in each case) granted
in the ordinary course of business for amounts not overdue for a period of more
than 60 days or are being diligently contested in good faith by appropriate
proceedings and for which adequate reserves in accordance with GAAP shall have
been set aside on its books or with respect to which the failure to make payment
could not reasonably be expected to have a Material Adverse Effect;
     (g) (i) Liens incurred or deposits made in the ordinary course of business
in connection with worker’s compensation, unemployment insurance or other forms
of governmental insurance or benefits, or to secure performance of tenders,
statutory obligations, bids, leases, trade contracts or other similar
obligations (other than for borrowed money) entered into in the ordinary course
of business or to secure obligations on surety and appeal bonds or performance
bonds, performance and completion guarantees and other obligations of a like
nature (including those to secure health, safety and environmental obligations)
incurred in the ordinary course of business and (ii) obligations in respect of
letters of credit or bank guarantees that have been posted to support payment of
the items set forth in the immediately preceding clause (i);
     (h) judgment Liens that are being appealed in good faith or with respect to
which execution has been stayed or the payment of which is covered in full
(subject to a customary deductible) by insurance maintained with responsible
insurance companies and which do not otherwise result in an Event of Default
under Section 8.1.6;
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     (i) easements, rights-of-way, covenants, conditions, building codes,
restrictions, reservations, minor defects or irregularities in title and other
similar encumbrances and matters that would be disavowed by a full survey of
real property not interfering in any material respect with the value or use of
the affected or encumbered real property to which such Lien is attached;
     (j) Liens securing Indebtedness permitted by clause (h) (subject to the
Intercreditor Agreement) or (n) of Section 7.2.2;
     (k) Liens arising solely by virtue of any statutory or common law provision
relating to banker’s liens, rights of set-off or similar rights and remedies as
to deposit accounts or other funds maintained with a creditor depository
institution and Liens attaching to commodity trading accounts or other
commodities brokerage accounts incurred in the ordinary course of business;
     (l) (i) licenses, sublicenses, leases or subleases granted to third Persons
in the ordinary course of business not interfering in any material respect with
the business of the Borrower or any of its Subsidiaries, (ii) other agreements
with respect to the use and occupancy of real property entered into in the
ordinary course of business or in connection with a Disposition permitted under
the Loan Documents or (iii) the rights reserved or vested in any Person by the
terms of any lease, license, franchise, grant or permit held by Borrower or any
of its Subsidiaries or by a statutory provision, to terminate any such lease,
license, franchise, grant or permit, or to require annual or periodic payments
as a condition to the continuance thereof;
     (m) Liens on the property of the Borrower or any of its Subsidiaries
securing (i) the non-delinquent performance of bids, trade contracts (other than
for borrowed money), leases, licenses and statutory obligations, (ii) Contingent
Obligations on surety and appeal bonds, and (iii) other non-delinquent
obligations of a like nature; in each case, incurred in the ordinary course of
business;
     (n) Liens on Receivables transferred to a Receivables Subsidiary under a
Permitted Securitization;
     (o) Liens upon specific items or inventory or other goods and proceeds of
the Borrower or any of its Subsidiaries securing such Person’s obligations in
respect of bankers’ acceptances or documentary letters of credit issued or
created for the account of such Person to facilitate the shipment or storage of
such inventory or other goods;
     (p) Liens (i) (A) on advances of cash or Cash Equivalent Investments in
favor of the seller of any property to be acquired in an Investment permitted
pursuant to Section 7.2.5 to be applied against the purchase price for such
Investment and (B) consisting of an agreement to Dispose of any property in a
Disposition permitted under Section 7.2.11, in each case under this clause (i),
solely to the extent such Investment or Disposition, as the case may be, would
have been permitted on the date of the creation of such Lien and (ii) on earnest
money deposits of cash or Cash Equivalent Investments
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made by the Borrower or any of its Subsidiaries in connection with any letter of
intent or purchase agreement permitted hereunder;
     (q) Liens arising from precautionary Uniform Commercial Code financing
statement filings (or similar filings under other applicable Law) regarding
leases entered into by the Borrower or any of its Subsidiaries in the ordinary
course of business;
     (r) Liens (i) arising out of conditional sale, title retention, consignment
or similar arrangements for sale of goods (including under Article 2 of the UCC)
and Liens that are contractual rights of set-off relating to purchase orders and
other similar agreements entered into by the Borrower or any of its Subsidiaries
and (ii) relating to the establishment of depository relations with banks not
given in connection with the issuance of Indebtedness and (iii) relating to
pooled deposit or sweep accounts of the Borrower or any Subsidiary to permit
satisfaction of overdraft or similar obligations in each case in the ordinary
course of business and not prohibited by this Agreement;
     (s) other Liens securing Indebtedness or other obligations permitted under
this Agreement and outstanding in an aggregate principal amount not to exceed
$75,000,000;
     (t) ground leases in respect of real property on which facilities owned or
leased by the Borrower or any of its Subsidiaries are located or any Liens
senior to any lease, sub-lease or other agreement under which the Borrower or
any of its Subsidiaries uses or occupies any real property;
     (u) Liens constituting security given to a public or private utility or any
Governmental Authority as required in the ordinary course of business;
     (v) pledges or deposits of cash and Cash Equivalent Investments securing
deductibles, self-insurance, co-payment, co-insurance, retentions and similar
obligations to providers of insurance in the ordinary course of business;
     (w) Liens on (A) incurred premiums, dividends and rebates which may become
payable under insurance policies and loss payments which reduce the incurred
premiums on such insurance policies and (B) rights which may arise under State
insurance guarantee funds relating to any such insurance policy, in each case
securing Indebtedness permitted to be incurred pursuant to clause (p) of
Section 7.2.2; and
     (x) Liens for Taxes not at the time delinquent or thereafter payable
without penalty or being diligently contested in good faith by appropriate
proceedings and for which adequate reserves in accordance with GAAP shall have
been set aside on its books or with respect to which the failure to make payment
could not reasonably be expected to have a Material Adverse Effect.
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     SECTION 7.2.4 Financial Condition and Operations. The Borrower will not
permit any of the events set forth below to occur.
     (a) The Borrower will not permit the Leverage Ratio as of the last day of
any Fiscal Quarter occurring during any period set forth below to be greater
than the ratio set forth opposite such period:

          Period   Leverage Ratio
Each Fiscal Quarter ending between December 15, 2006 and April 15, 2007
    5.50:1.00  
 
       
Each Fiscal Quarter ending between April 16, 2007 and July 15, 2007
    5.00:1.00  
 
       
Each Fiscal Quarter ending between July 16, 2007 and October 15, 2007
    4.75:1.00  
 
       
Each Fiscal Quarter ending between October 16, 2007 and April 15, 2008
    4.50:1.00  
 
       
Each Fiscal Quarter ending between April 16, 2008 and July 15, 2008
    4.25:1.00  
 
       
Each Fiscal Quarter ending between July 16, 2008 and October 15, 2008
    4.00:1.00  
 
       
Each Fiscal Quarter ending between October 16, 2008 and April 15, 2009
    3.75:1.00  
 
       
Each Fiscal Quarter ending between April 16, 2009 and July 15, 2009
    3.50:1.00  
 
       
Each Fiscal Quarter ending between July 16, 2009 and October 15, 2009
    3.25:1.00  
 
       
Each Fiscal Quarter thereafter
    3.00:1.00  

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     (b) The Borrower will not permit the Interest Coverage Ratio as of the last
day of any Fiscal Quarter occurring during any period set forth below to be less
than the ratio set forth opposite such period:

          Period   Interest Coverage Ratio
Each Fiscal Quarter ending between December 15, 2006 and July 15, 2007
    2.00:1.00  
 
       
Each Fiscal Quarter ending between July 16, 2007 and January 15, 2008
    2.25:1.00  
 
       
Each Fiscal Quarter ending between January 16, 2008 and October 15, 2008
    2.50:1.00  
 
       
Each Fiscal Quarter ending between October 16, 2008 and April 15, 2009
    2.75:1.00  
 
       
Each Fiscal Quarter ending between April 16, 2009 and October 15, 2009
    3.00:1.00  
 
       
Each Fiscal Quarter thereafter
    3.25:1.00  

     SECTION 7.2.5 Investments. The Borrower will not, and will not permit any
of its Subsidiaries to, purchase, make, incur, assume or permit to exist any
Investment in any other Person, except:
     (a) Investments existing on the Closing Date and identified in
Item 7.2.5(a) of the Disclosure Schedule;
     (b) Cash Equivalent Investments;
     (c) Investments received in connection with the bankruptcy or
reorganization of, or settlement of delinquent accounts and disputes with,
customers and suppliers, in each case in the ordinary course of business;
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     (d) Investments consisting of any deferred portion (including promissory
notes and non-cash consideration) of the sales price received by the Borrower or
any Subsidiary in connection with any Disposition permitted under
Section 7.2.11;
     (e) Investments by way of contributions to capital or purchases of Capital
Securities (i) by the Borrower in any Subsidiaries or by any Subsidiary in other
Subsidiaries or by the Borrower or any Subsidiary in any Foreign Supply Chain
Entity; provided that, the aggregate amount of intercompany loans made pursuant
to clause (f)(ii) of Section 7.2.2, Indebtedness converted into equity pursuant
to clause (f)(ii)(A) of Section 7.2.2 and Investments under this clause made by
the Borrower and Subsidiary Guarantors in (x) Subsidiaries that are not
Subsidiary Guarantors or (y) any Foreign Supply Chain Entity shall not exceed
the amount set forth in clause (f)(ii) of Section 7.2.2 at any one time
outstanding, or (ii) by any Subsidiary in the Borrower;
     (f) Investments constituting (i) accounts receivable arising or acquired,
(ii) trade debt granted, or (iii) deposits made in connection with the purchase
price of goods or services, in each case in the ordinary course of business;
     (g) Investments by way of the acquisition of Capital Securities or the
purchase or other acquisition of all or substantially all of the assets or
business of any Person, or of assets constituting a business unit, or line of
business or division of, such Person, in each case constituting Permitted
Acquisitions in an amount, when aggregated with the amount expended under clause
(b) of Section 7.2.10, does not exceed the amount set forth in clause (b) of
Section 7.2.10 in any Fiscal Year;
     (h) Investments constituting Capital Expenditures permitted pursuant to
Section 7.2.7;
     (i) Investments in a Receivables Subsidiary or any Investment by a
Receivables Subsidiary in any other Person under a Permitted Securitization;
provided that any Investment in a Receivables Subsidiary is in the form of a
Purchase Money Note, contribution of additional receivables and related assets
or any equity interests;
     (j) Investments constituting loans or advances to officers, directors or
employees made in the ordinary course of business (including for travel,
entertainment and relocation expenses) in an aggregate amount not to exceed
$10,000,000;
     (k) Investments by any Foreign Subsidiary in any other Foreign Subsidiary;
     (l) Investments in the ordinary course of business consisting of
(i) endorsements for collection or deposit, (ii) customary arrangements with
customers or (iii) Hedging Obligations not for speculative purposes;
     (m) advances of payroll payments to employees in the ordinary course of
business; and
     (n) other Investments in an amount not to exceed $100,000,000 over the term
of this Agreement;
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provided that (I) any Investment which when made complies with the requirements
of the definition of the term “Cash Equivalent Investment” may continue to be
held notwithstanding that such Investment if made thereafter would not comply
with such requirements; and (II) no Investment otherwise permitted by clauses
(e)(i) (to the extent such Investment relates to an Investment in a Foreign
Subsidiary or a Foreign Supply Chain Entity), (g) or (n) shall be permitted to
be made if any Event of Default has occurred and is continuing.
     SECTION 7.2.6 Restricted Payments, etc. The Borrower will not, and will not
permit any of its Subsidiaries (other than a Receivables Subsidiary) to, declare
or make a Restricted Payment, or make any deposit for any Restricted Payment,
other than (a) Restricted Payments made by Subsidiaries to the Borrower or
wholly owned Subsidiaries, (b) the Dividend, (c) cashless exercises of stock
options, (d) cash payments by Borrower in lieu of the issuance of fractional
shares upon exercise or conversion of Equity Equivalents, (e) Restricted
Payments in connection with the share repurchases required by the employee stock
ownership programs or required under employee agreements, (f) so long as (i) no
Specified Default has occurred and is continuing or would result therefrom, and
(ii) both before and after giving effect to such Restricted Payment, the
Borrower is in pro forma compliance with Section 7.2.4, Permitted Additional
Restricted Payments and (g) Restricted Payments made by a Foreign Supply Chain
Entity that has been redesignated as a Foreign Subsidiary, to the Persons owning
such Foreign Subsidiary’s Capital Securities.
     SECTION 7.2.7 Capital Expenditures.
(a)     Subject (in the case of Capitalized Lease Liabilities), to clause (e) of
Section 7.2.2, the Borrower will not, and will not permit any of its
Subsidiaries to, make or commit to make Capital Expenditures except Capital
Expenditures in an aggregate amount not to exceed $130,000,000 in any Fiscal
Year; provided that, to the extent that the amount of Capital Expenditures made
by the Borrower and its Subsidiaries during any Fiscal Year is less than the
aggregate amount permitted (including after giving effect to this proviso) for
such Fiscal Year, then such unutilized amount may be carried forward and
utilized by the Borrower and its Subsidiaries to make Capital Expenditures in
any succeeding Fiscal Year. Notwithstanding anything to the contrary with
respect to any Fiscal Year of the Borrower during which a Permitted Acquisition
is consummated and for each Fiscal Year subsequent thereto, the amount of
Capital Expenditures permitted under the preceding sentence applicable to each
such Fiscal Year shall be increased by an amount equal to 5% of the purchase
price of each Permitted Acquisition (the “Acquired Permitted Capital Expenditure
Amount”); provided, however, with respect to the Fiscal Year during which any
such Permitted Acquisition occurs, the amount of additional Capital Expenditures
permitted as a result of this sentence shall be an amount equal to the product
of (x) the Acquired Permitted Capital Expenditure Amount and (y) a fraction, the
numerator of which is the number of days remaining in such Fiscal Year after the
date such Permitted Acquisition is consummated and the denominator of which is
the actual number of days in such Fiscal Year.
(b)     Notwithstanding anything to the contrary contained in clause (a) above,
for any Fiscal Year, the amount of Capital Expenditures that would otherwise be
permitted in such Fiscal Year pursuant to this Section 7.2.7 (including as a
result of the carry-forward
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described in the proviso to the first sentence of clause (a) above) may be
increased by an amount not to exceed $10,000,000 (the “CapEx Pull-Forward
Amount”). The actual CapEx Pull-Forward Amount in respect of any such Fiscal
Year shall reduce, on a dollar-for-dollar basis, the amount of Capital
Expenditures that would have been permitted to be made in the immediately
succeeding Fiscal Year (provided that the Borrower and its Subsidiaries may
apply the CapEx Pull-Forward Amount in such immediately succeeding Fiscal Year).
     SECTION 7.2.8 Payments With Respect to Certain Indebtedness. The Borrower
will not, and will not permit any of its Subsidiaries to,
     (a) make any payment or prepayment of principal of, or premium or interest
on, any Indebtedness incurred under the Second Lien Loan Documents, the Bridge
Loan Documents or the Senior Note Documents (including any redemption or
retirement thereof) (i) other than on (or after) the stated, scheduled date for
payment of interest set forth in the applicable Second Lien Loan Documents,
Bridge Loan Documents or Senior Note Documents, respectively, or (ii) which
would violate the terms of this Agreement, the Intercreditor Agreement or the
applicable Second Lien Loan Documents, Bridge Loan Documents or Senior Note
Documents;
     (b) except as otherwise permitted by clause (a) above, prior to the
Termination Date, redeem, retire, purchase, defease or otherwise acquire any
Indebtedness under the Second Lien Loan Documents, the Bridge Loan Documents or
the Senior Note Documents (other than with proceeds from the issuance of the
Borrower’s Capital Securities (to the extent not otherwise required to be used
to repay Loans pursuant to clause (e) of Section 3.1.1) permitted to be used to
redeem Senior Notes in accordance with the terms of the Senior Note Documents);
     (c) make any deposit (including the payment of amounts into a sinking fund
or other similar fund) for any of the foregoing purposes; or
     (d) make any payment or prepayment of principal of, or premium or interest
on, any Indebtedness that is by its express written terms subordinated to the
payment of the Obligations at any time when an Event of Default has occurred and
is continuing.
Notwithstanding anything to the contrary contained in this Section, the Borrower
shall be permitted to refinance, in whole or in part, the Indebtedness under the
Bridge Loan Documentation with the proceeds from the issuance of Senior Notes.
     SECTION 7.2.9 Issuance of Capital Securities. The Borrower will not permit
any of its Subsidiaries (other than a Receivables Subsidiary and any Foreign
Supply Chain Entity that has been redesignated as a Foreign Subsidiary) to issue
any Capital Securities (whether for value or otherwise) to any Person other than
to the Borrower or another wholly owned Subsidiary (other than any director’s
qualifying shares or investments by foreign nationals mandated by applicable
laws).
     SECTION 7.2.10 Consolidation, Merger; Permitted Acquisitions, etc. The
Borrower will not, and will not permit any of its Subsidiaries to, liquidate or
dissolve, consolidate with, or
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merge into or with, any other Person, or purchase or otherwise acquire all or
substantially all of the assets of any Person (or any division or line of
business thereof), except
     (a) any Subsidiary may liquidate or dissolve voluntarily into, and may
merge with and into, the Borrower or any other Subsidiary (provided that a
Subsidiary Guarantor may only liquidate or dissolve into, or merge with and
into, the Borrower or another Subsidiary Guarantor), and the assets or Capital
Securities of any Subsidiary may be purchased or otherwise acquired by the
Borrower or any other Subsidiary (provided that the assets or Capital Securities
of any Subsidiary Guarantor may only be purchased or otherwise acquired by the
Borrower or another Subsidiary Guarantor); provided, further, that in no event
shall any Subsidiary consolidate with or merge with and into any other
Subsidiary unless after giving effect thereto, the Collateral Agent shall have a
perfected pledge of, and security interest in and to, at least the same
percentage of the issued and outstanding interests of Capital Securities (on a
fully diluted basis) and other assets of the surviving Person as the Collateral
Agent had immediately prior to such merger or consolidation in form and
substance reasonably satisfactory to the Agents, pursuant to such documentation
and opinions as shall be necessary in the opinion of the Agents to create,
perfect or maintain the collateral position of the Secured Parties therein; and
     (b) so long as no Event of Default has occurred and is continuing or would
occur after giving effect thereto, the Borrower or any of its Subsidiaries may
purchase the Capital Securities, all or substantially all of the assets of any
Person (or any division or line of business thereof), or acquire such Person by
merger, in each case, if such purchase or acquisition constitutes a Permitted
Acquisition, and the amount expended in connection with such transaction, when
aggregated with the amount expended under clause (g) of Section 7.2.5, does not
exceed $100,000,000 per Fiscal Year plus the amount of Net Disposition Proceeds
the Borrower is not required to repay pursuant to Section 3.1.1 and not
otherwise reinvested hereunder (so long as such proceeds are actually used for
such purpose) and the Excluded Equity Proceeds Amount (so long as such proceeds
are actually used for such purpose); provided that any Capital Securities of the
Borrower issued to the seller in connection with any Permitted Acquisition shall
not result in a deduction of amounts available to consummate Permitted
Acquisitions hereunder.
     SECTION 7.2.11 Permitted Dispositions. The Borrower will not, and will not
permit any of its Subsidiaries to, Dispose of any of the Borrower’s or such
Subsidiaries’ assets (including accounts receivable and Capital Securities of
Subsidiaries) to any Person in one transaction or series of transactions unless
such Disposition is:
     (a) inventory or obsolete, no longer used or useful, damaged, worn out or
surplus property Disposed of in the ordinary course of its business (including,
the abandonment of intellectual property which is obsolete, no longer used or
useful or that in the Borrower’s good faith judgment is no longer material in
the conduct of the Borrower and is Subsidiaries’ business taken as a whole):
     (b) permitted by Section 7.2.10;
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     (c) accounts receivable or any related asset Disposed of pursuant to a
Permitted Securitization;
     (d) of 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 promptly applied to the purchase price of such
replacement property;
     (e) of property by the Borrower or any Subsidiary; provided that if the
transferor of such property is an Obligor (i) the transferee must be an Obligor
or (ii) to the extent such transaction constitutes an Investment such
transaction is permitted under Section 7.2.5;
     (f) of cash or Cash Equivalent Investments;
     (g) of accounts receivable in connection with compromise, write down or
collection thereof in the ordinary course of business;
     (h) constituting leases, subleases, licenses or sublicenses of property
(including intellectual property) in the ordinary course of business and which
do not materially interfere with the business of the Borrower and its
Subsidiaries;
     (i) constituting a transfer of property subject to a Casualty Event
(i) upon receipt of Net Casualty Proceeds of such Casualty Event or (ii) to a
Governmental Authority as a result of condemnation;
     (j) sales of a non-core assets acquired in connection with a Permitted
Acquisition which are not used or useful or are duplicative in the business of
the Borrower or its Subsidiaries;
     (k) a grant of options to purchase, lease or acquire real or personal
property in the ordinary course of business, so long as the Disposition
resulting from the exercise of such option would otherwise be permitted under
this Section 7.2.11;
     (l) Dispositions of Investments in Foreign Supply Chain Entities (or a
Foreign Supply Chain Entity that has been redesignated as a Foreign Subsidiary),
to the extent required by, or made pursuant to buy/sell arrangements between the
Foreign Supply Chain Entity parties forth in, the contracts applicable to such
Foreign Supply Chain Entity (or a Foreign Supply Chain Entity that has been
redesignated as a Foreign Subsidiary);
     (m) Dispositions of the property described on Item 7.2.11(m) of the
Disclosure Schedule; or
     (n) a Disposition of assets not otherwise permitted pursuant to preceding
clauses (a)-(m) and (i) is for fair market value and the consideration received
consists of no less than 75% in cash and Cash Equivalent Investments, (ii) the
Net Disposition Proceeds received from such Disposition, together with the Net
Disposition Proceeds of all other assets Disposed of pursuant to this clause
since the Closing Date, does not
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exceed (individually or in the aggregate) $100,000,000 and (iii) the Net
Disposition Proceeds from such Disposition are applied pursuant to
Sections 3.1.1 and 3.1.2.
     SECTION 7.2.12 Modification of Certain Agreements. The Borrower will not,
and will not permit any of its Subsidiaries to, consent to any amendment,
supplement, waiver or other modification of, or enter into any forbearance from
exercising any rights with respect to the terms or provisions contained in,
     (a) the Second Lien Loan Documents, except in accordance with the
Intercreditor Agreement;
     (b) any of the other Transaction Documents other than any amendment,
supplement, waiver or modification which would not be materially adverse to the
Secured Parties; or
     (c) the Organic Documents of the Borrower or any of its Subsidiaries (other
than a Receivables Subsidiary) other than any amendment, supplement, waiver or
modification which would not be materially adverse to the Secured Parties.
     SECTION 7.2.13 Transactions with Affiliates. The Borrower will not, and
will not permit any of its Subsidiaries to, enter into or cause or permit to
exist any arrangement, transaction or contract (including for the purchase,
lease or exchange of property or the rendering of services) with any of its
other Affiliates, unless such arrangement, transaction or contract is on fair
and reasonable terms no less favorable to the Borrower or such Subsidiary than
it could obtain in an arm’s-length transaction with a Person that is not an
Affiliate other than arrangements, transactions or contracts (a) between or
among the Borrower and any Subsidiaries, (b) in connection with the cash
management of the Borrower and its Subsidiaries in the ordinary course of
business, (c) in connection with a Permitted Securitization including Standard
Securitization Undertakings or (d) that is a Transaction Document.
     SECTION 7.2.14 Restrictive Agreements, etc. The Borrower will not, and will
not permit any of its Subsidiaries (other than a Receivables Subsidiary) to,
enter into any agreement prohibiting
     (a) the creation or assumption of any Lien upon its properties, revenues or
assets, whether now owned or hereafter acquired;
     (b) the ability of any Obligor to amend or otherwise modify any Loan
Document; or
     (c) the ability of any Subsidiary (other than a Receivables Subsidiary) to
make any payments, directly or indirectly, to the Borrower, including by way of
dividends, advances, repayments of loans, reimbursements of management and other
intercompany charges, expenses and accruals or other returns on investments.
The foregoing prohibitions shall not apply to restrictions contained (i) in any
Loan Document or in any Second Lien Loan Document (subject to the terms of the
Intercreditor Agreement), (iii) in the cases of clause (a) and (c), in any
Bridge Loan Document or Senior Note Document, (iv) in
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the case of clause (a), any agreement governing any Indebtedness permitted by
clause (n) of Section 7.2.2 as to the assets financed with the proceeds of such
Indebtedness, (v) in the case of clauses (a) and (c), any agreement of a Foreign
Subsidiary governing the Indebtedness permitted to be incurred or permitted to
exist hereunder, (vi) with respect to any Receivables Subsidiary, in the case of
clauses (a) and (c), the documentation governing any Securitization permitted
hereunder, (vii) solely with respect to clause (a), any arrangement or agreement
arising in connection with a Disposition permitted under this Agreement (but
then only with respect to the assets being so Disposed), (viii) solely with
respect to clause (a) and (c), are already binding on a Subsidiary when it is
acquired, (ix) solely with respect to clause (a), customary restrictions in
leases, subleases, licenses and sublicenses and (x) solely with respect to
clause (a) and (c), any agreement of a Foreign Supply Chain Entity that was
redesignated as a Foreign Subsidiary.
     SECTION 7.2.15 Sale and Leaseback. The Borrower will not, and will not
permit any of its Subsidiaries to, directly or indirectly enter into any
agreement or arrangement providing for the sale or transfer by it of any
property (now owned or hereafter acquired) to a Person and the subsequent lease
or rental of such property or other similar property from such Person, except
for agreements and arrangements with respect to property the fair market value
(as determined in good faith by the Board of Directors of the Borrower) of which
does not exceed $100,000,000 in the aggregate following the Closing Date and the
Net Disposition Proceeds of which are applied pursuant to Sections 3.1.1 and
3.1.2.
     SECTION 7.2.16 Investments in European TM SPV. Notwithstanding anything
else set forth herein, the Borrower will not, and will not permit any of its
Subsidiaries to make any additional Investment in European TM SPV or transfer
any of their respective assets to European TM SPV.
ARTICLE VIII
EVENTS OF DEFAULT
     SECTION 8.1 Listing of Events of Default. Each of the following events or
occurrences described in this Article shall constitute an “Event of Default”.
     SECTION 8.1.1 Non-Payment of Obligations. The Borrower shall default in the
payment or prepayment when due of
     (a) any principal of any Loan, or any Reimbursement Obligation or any
deposit of cash for collateral purposes pursuant to Section 2.6.4;
     (b) any interest on any Loan or any fee described in Article III, and such
default shall continue unremedied for a period of three days after such interest
or fee was due; or
     (c) any other monetary Obligation, and such default shall continue
unremedied for a period of 10 Business Days after such amount was due.
     SECTION 8.1.2 Breach of Warranty. Any representation or warranty of any
Obligor made or deemed to be made in any Loan Document (including any
certificates delivered
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pursuant to Article V) is or shall be incorrect in any material respect when
made or deemed to have been made.
     SECTION 8.1.3 Non-Performance of Certain Covenants and Obligations. The
Borrower shall default in the due performance or observance of any of its
obligations under Section 7.1.1, Section 7.1.7, Section 7.1.11 or Section 7.2.
     SECTION 8.1.4 Non-Performance of Other Covenants and Obligations. Any
Obligor shall default in the due performance and observance of any other
agreement contained in any Loan Document executed by it, and such default shall
continue unremedied for a period of 30 days after the earlier to occur of
(a) notice thereof given to the Borrower by any Agent or any Lender or (b) the
date on which any Obligor has knowledge of such default.
     SECTION 8.1.5 Default on Other Indebtedness. A default shall occur in the
payment of any amount when due (subject to any applicable grace period), whether
by acceleration or otherwise, of any principal or stated amount of, or interest
or fees on, any Indebtedness (other than Indebtedness described in
Section 8.1.1) of the Borrower or any of its Subsidiaries (other than a
Receivables Subsidiary) or any other Obligor having a principal or stated
amount, individually or in the aggregate, in excess of $50,000,000, or a default
shall occur in the performance or observance of any obligation or condition with
respect to such Indebtedness if the effect of such default is to accelerate the
maturity of any such Indebtedness or such default shall continue unremedied for
any applicable period of time sufficient to permit the holder or holders of such
Indebtedness, or any trustee or agent for such holders, to cause or declare such
Indebtedness to become due and payable or to require such Indebtedness to be
prepaid, redeemed, purchased or defeased, or require an offer to purchase or
defease such Indebtedness to be made, prior to its expressed maturity.
     SECTION 8.1.6 Judgments. Any (a) judgment or order for the payment of money
individually or in the aggregate in excess of $50,000,000 (exclusive of any
amounts fully covered by insurance (less any applicable deductible) or an
indemnity by any other third party Person and as to which the insurer or such
Person has acknowledged its responsibility to cover such judgment or order not
denied in writing) shall be rendered against the Borrower or any of its
Subsidiaries (other than a Receivables Subsidiary) and such judgment shall not
have been vacated or discharged or stayed or bonded pending appeal within
45 days after the entry thereof or enforcement proceedings shall have been
commenced by any creditor upon such judgment or order or (b) non-monetary
judgment or order that has had, or could reasonably be expected to have, a
Material Adverse Effect.
     SECTION 8.1.7 Pension Plans. Any of the following events shall occur with
respect to any Pension Plan
     (a) the institution of any steps by the Borrower, any member of its
Controlled Group or any other Person to terminate a Pension Plan if, as a result
of such termination, the Borrower or any such member could be required to make a
contribution to such Pension Plan, or could reasonably expect to incur a
liability or obligation to such Pension Plan, in excess of $50,000,000; or
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     (b) a contribution failure occurs with respect to any Pension Plan
sufficient to give rise to a Lien under Section 302(f) of ERISA.
     SECTION 8.1.8 Change in Control. Any Change in Control shall occur.
     SECTION 8.1.9 Bankruptcy, Insolvency, etc. The Borrower, any of its
Subsidiaries (other than a Receivables Subsidiary) or any other Obligor shall
     (a) become insolvent or generally fail to pay, or admit in writing its
inability or unwillingness generally to pay, debts as they become due;
     (b) apply for, consent to, or acquiesce in the appointment of a trustee,
receiver, sequestrator or other custodian for any substantial part of the
property of any thereof, or make a general assignment for the benefit of
creditors;
     (c) in the absence of such application, consent or acquiescence in or
permit or suffer to exist the appointment of a trustee, receiver, sequestrator
or other custodian for a substantial part of the property of any thereof, and
such trustee, receiver, sequestrator or other custodian shall not be discharged,
stayed, vacated or bonded pending appeal within 60 days; provided that, the
Borrower, each Subsidiary and each other Obligor hereby expressly authorizes
each Secured Party to appear in any court conducting any relevant proceeding
during such 60-day period to preserve, protect and defend their rights under the
Loan Documents;
     (d) permit or suffer to exist the commencement of any bankruptcy,
reorganization, debt arrangement or other case or proceeding under any
bankruptcy or insolvency law or any dissolution, winding up or liquidation
proceeding, in respect thereof, and, if any such case or proceeding is not
commenced by the Borrower, any Subsidiary or any Obligor, such case or
proceeding shall be consented to or acquiesced in by the Borrower, such
Subsidiary or such Obligor, as the case may be, or shall result in the entry of
an order for relief or shall remain for 60 days undismissed, undischarged,
unstayed or unbonded pending appeal; provided that, the Borrower, each
Subsidiary and each Obligor hereby expressly authorizes each Secured Party to
appear in any court conducting any such case or proceeding during such 60-day
period to preserve, protect and defend their rights under the Loan Documents; or
     (e) take any action authorizing, or in furtherance of, any of the
foregoing.
     SECTION 8.1.10 Impairment of Security, etc. Any Loan Document or any Lien
granted thereunder (effecting a material portion of the Collateral, taken as a
whole) shall (except in accordance with its terms), in whole or in part,
terminate, cease to be effective or cease to be the legally valid, binding and
enforceable obligation of any Obligor party thereto (other than pursuant to a
failure of the Administrative Agent, any collateral agent appointed by the
Administrative Agent or the Lenders to take any action within the sole control
of such Person); any Obligor or any other party shall, directly or indirectly,
contest in any manner such effectiveness, validity, binding nature or
enforceability; or, except as permitted under any Loan Document, any Lien
securing any Obligation shall, in whole or in part, cease to be a perfected
first priority Lien or any Obligor shall so assert (other than, in each case,
pursuant to a failure of
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the Administrative Agent, any collateral agent appointed by the Administrative
Agent or the Lenders to take any action within the sole control of such Person).
     SECTION 8.2 Action if Bankruptcy. If any Event of Default described in
clauses (a) through (d) of Section 8.1.9 with respect to the Borrower shall
occur, the Commitments (if not theretofore terminated) shall automatically
terminate and the outstanding principal amount of all outstanding Loans and all
other Obligations (including Reimbursement Obligations) shall automatically be
and become immediately due and payable, without notice or demand to any Person
and each Obligor shall automatically and immediately be obligated to Cash
Collateralize all Letter of Credit Outstandings.
     SECTION 8.3 Action if Other Event of Default. If any Event of Default
(other than any Event of Default described in clauses (a) through (d) of
Section 8.1.9 with respect to the Borrower) shall occur for any reason, whether
voluntary or involuntary, and be continuing, the Administrative Agent, upon the
direction of the Required Lenders, shall by notice to the Borrower declare all
or any portion of the outstanding principal amount of the Loans and other
Obligations (including Reimbursement Obligations) to be due and payable and/or
the Commitments (if not theretofore terminated) to be terminated, whereupon the
full unpaid amount of such Loans and other Obligations which shall be so
declared due and payable shall be and become immediately due and payable,
without further notice, demand or presentment, and/or, as the case may be, the
Commitments shall terminate and the Borrower shall automatically and immediately
be obligated to Cash Collateralize all Letter of Credit Outstandings.
ARTICLE IX
THE ADMINISTRATIVE AGENT, THE COLLATERAL AGENT; THE LEAD ARRANGERS,
THE SYNDICATION AGENT AND THE DOCUMENTATION AGENT
     SECTION 9.1 Actions. Each Lender hereby appoints Citicorp USA as its
Administrative Agent and CitiNA, as its collateral agent, under and for purposes
of each Loan Document. Each Lender authorizes each Agent to act on behalf of
such Lender under each Loan Document and, in the absence of other written
instructions from the Required Lenders received from time to time by such Agent
(with respect to which each Agent agrees that it will comply, except as
otherwise provided in this Section or as otherwise advised by counsel in order
to avoid contravention of applicable law), to exercise such powers hereunder and
thereunder as are specifically delegated to or required of such Agent by the
terms hereof and thereof, together with such powers as may be incidental thereto
(including the release of Liens on assets Disposed of in accordance with the
terms of the Loan Documents). Each Lender hereby indemnifies (which indemnity
shall survive any termination of this Agreement) each Agent, pro rata according
to such Lender’s proportionate Total Exposure Amount, from and against any and
all liabilities, obligations, losses, damages, claims, costs or expenses of any
kind or nature whatsoever which may at any time be imposed on, incurred by, or
asserted against, such Agent in any way relating to or arising out of any Loan
Document (including reasonable attorneys’ fees and expenses), and as to which
such Agent is not reimbursed by the Borrower (and without limiting its
obligation to do so); provided that no Lender shall be liable for the payment of
any portion of such liabilities, obligations, losses, damages, claims, costs or
expenses which are determined by a court of competent jurisdiction in a final
proceeding to have resulted from such Agent’s gross negligence or willful
misconduct. No Agent shall be required to take any action under any Loan
Document,
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or to prosecute or defend any suit in respect of any Loan Document, unless it is
indemnified hereunder to its reasonable satisfaction. If any indemnity in favor
of any Agent shall be or become, in such Agent’s determination, inadequate, such
Agent may call for additional indemnification from the Lenders and cease to do
the acts indemnified against hereunder until such additional indemnity is given.
     SECTION 9.2 Funding Reliance, etc. Unless the Administrative Agent shall
have been notified in writing by any Lender by 3:00 p.m. on the Business Day
prior to a Borrowing that such Lender will not make available the amount which
would constitute its Percentage of such Borrowing on the date specified
therefor, the Administrative Agent may assume that such Lender has made such
amount available to the Administrative Agent and, in reliance upon such
assumption, make available to the Borrower a corresponding amount. If and to the
extent that such Lender shall not have made such amount available to the
Administrative Agent, such Lender and the Borrower severally agree to repay the
Administrative Agent forthwith on demand such corresponding amount together with
interest thereon, for each day from the date the Administrative Agent made such
amount available to the Borrower to the date such amount is repaid to the
Administrative Agent, at the interest rate applicable at the time to Loans
comprising such Borrowing (in the case of the Borrower) and (in the case of a
Lender), at the Federal Funds Rate (for the first two Business Days after which
such amount has not been repaid), and thereafter at the interest rate applicable
to Loans comprising such Borrowing.
     SECTION 9.3 Exculpation. Neither any Lead Arranger, any Agent nor any of
its directors, officers, employees, agents or Affiliates shall be liable to any
Secured Party for any action taken or omitted to be taken by it under any Loan
Document, or in connection therewith, except for its own willful misconduct or
gross negligence, nor responsible for any recitals or warranties herein or
therein, nor for the effectiveness, enforceability, validity or due execution of
any Loan Document, or the validity, genuineness, enforceability, existence,
value or sufficiency of any collateral security, nor to make any inquiry
respecting the performance by any Obligor of its Obligations. Any such inquiry
which may be made by a Lead Arranger or an Agent shall not obligate it to make
any further inquiry or to take any action. Each Lead Arranger and each Agent
shall be entitled to rely upon advice of counsel concerning legal matters and
upon any notice, consent, certificate, statement or writing which such Lead
Arranger or such Agent believes to be genuine and to have been presented by a
proper Person.
     SECTION 9.4 Successor. Any Agent may resign as such at any time upon at
least 30 days’ prior notice to the Borrower and all Lenders. If any Agent at any
time shall resign, the Required Lenders may appoint (subject to, so long as no
Event of Default has occurred and is continuing, the reasonable consent of the
Borrower not to be unreasonably withheld or delayed) another Lender as such
Person’s successor Agent which shall thereupon become the applicable Agent
hereunder. If no successor Agent shall have been so appointed by the Required
Lenders (and consented to by the Borrower), and shall have accepted such
appointment, within 30 days after the retiring such Agent’s giving notice of
resignation, then the retiring Agent may, on behalf of the Lenders, appoint a
successor Agent, which shall be one of the Lenders or a commercial banking
institution organized under the laws of the United States (or any State thereof)
or a United States branch or agency of a commercial banking institution, and
having a combined capital and surplus of at least $250,000,000; provided that,
if, such retiring Agent is unable to find a commercial banking institution which
is willing to accept such appointment and
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which meets the qualifications set forth in above, the retiring Agent’s
resignation shall nevertheless thereupon become effective and the Lenders shall
assume and perform all of the duties of such Agent hereunder until such time, if
any, as the Required Lenders appoint a successor as provided for above. Upon the
acceptance of any appointment as an Agent hereunder by any successor Agent, such
successor Agent shall be entitled to receive from the retiring Agent such
documents of transfer and assignment as such successor Agent may reasonably
request, and shall thereupon succeed to and become vested with all rights,
powers, privileges and duties of the retiring Agent, and the retiring Agent
shall be discharged from its duties and obligations under the Loan Documents.
After any retiring Agent’s resignation hereunder as an Agent, the provisions of
this Article shall inure to its benefit as to any actions taken or omitted to be
taken by it while it was an Agent under the Loan Documents, and Section 10.3 and
Section 10.4 shall continue to inure to its benefit.
     SECTION 9.5 Loans by Citibank. Citibank shall have the same rights and
powers with respect to (a) the Credit Extensions made by it or any of its
Affiliates, and (b) the Notes held by it or any of its Affiliates as any other
Lender and may exercise the same as if it were not an Agent. Citibank and its
Affiliates may accept deposits from, lend money to, and generally engage in any
kind of business with the Borrower or any Subsidiary or Affiliate of the
Borrower as if Citibank were not an Agent hereunder.
     SECTION 9.6 Credit Decisions. Each Lender acknowledges that it has,
independently of the Administrative Agent and each other Lender, and based on
such Lender’s review of the financial information of the Borrower, the Loan
Documents (the terms and provisions of which being satisfactory to such Lender)
and such other documents, information and investigations as such Lender has
deemed appropriate, made its own credit decision to extend its Commitments. Each
Lender also acknowledges that it will, independently of the Administrative Agent
and each other Lender, and based on such other documents, information and
investigations as it shall deem appropriate at any time, continue to make its
own credit decisions as to exercising or not exercising from time to time any
rights and privileges available to it under the Loan Documents.
     SECTION 9.7 Copies, etc. Each Agent shall give prompt notice to each Lender
of each notice or request required or permitted to be given to such Agent by the
Borrower pursuant to the terms of the Loan Documents (unless concurrently
delivered to the Lenders by the Borrower). Each Agent will distribute to each
Lender each document or instrument received for its account and copies of all
other communications received by such Agent from the Borrower for distribution
to the Lenders by such Agent in accordance with the terms of the Loan Documents.
No Agent shall, except as expressly set forth in the Loan Documents, have any
duty to disclose, and shall not be liable for the failure to disclose, any
information relating to the Borrower or any of its Affiliates that is
communicated to or obtained by any Agent or any of its Affiliates in any
capacity.
     SECTION 9.8 Reliance by Agents. The Agents shall be entitled to rely upon
any certification, notice or other communication (including any thereof by
telephone, telecopy, telegram or cable) believed by it to be genuine and correct
and to have been signed or sent by or on behalf of the proper Person, and upon
advice and statements of legal counsel, independent accountants and other
experts selected by such Agent. As to any matters not expressly provided for by
the Loan Documents, the Agents shall in all cases be fully protected in acting,
or in
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refraining from acting, thereunder in accordance with instructions given by the
Required Lenders or all of the Lenders as is required in such circumstance, and
such instructions of such Lenders and any action taken or failure to act
pursuant thereto shall be binding on all Secured Parties. For purposes of
applying amounts in accordance with this Section, the Agents shall be entitled
to rely upon any Secured Party that has entered into a Rate Protection Agreement
with any Obligor for a determination (which such Secured Party agrees to provide
or cause to be provided upon request of any Agent) of the outstanding
Obligations owed to such Secured Party under any Rate Protection Agreement.
Unless it has actual knowledge evidenced by way of written notice from any such
Secured Party and the Borrower to the contrary, the Agents, in acting in such
capacity under the Loan Documents, shall be entitled to assume that no Rate
Protection Agreements or Obligations in respect thereof are in existence or
outstanding between any Secured Party and any Obligor.
     SECTION 9.9 Defaults. The Administrative Agent shall not be deemed to have
knowledge or notice of the occurrence of a Default (other than a Default under
Section 8.1.1) unless the Administrative Agent has received a written notice
from a Lender or the Borrower specifying such Default and stating that such
notice is a “Notice of Default”. In the event that the Administrative Agent
receives such a notice of the occurrence of a Default, the Administrative Agent
shall give prompt notice thereof to the Lenders. The Administrative Agent shall
(subject to Section 10.1) take such action with respect to such Default as shall
be directed by the Required Lenders; provided that, unless and until the
Administrative Agent shall have received such directions, the Administrative
Agent may (but shall not be obligated to) take such action, or refrain from
taking such action, with respect to such Default as it shall deem advisable in
the best interest of the Secured Parties except to the extent that this
Agreement expressly requires that such action be taken, or not be taken, only
with the consent or upon the authorization of the Required Lenders or all
Lenders.
     SECTION 9.10 Lead Arrangers, Syndication Agents and Documentation Agents.
Notwithstanding anything else to the contrary contained in this Agreement or any
other Loan Document, the Lead Arrangers, the Syndication Agents and the
Documentation Agents, in their respective capacities as such, each in such
capacity, shall have no duties or responsibilities under this Agreement or any
other Loan Document nor any fiduciary relationship with any Lender, and no
implied covenants, functions, responsibilities, duties, obligations or
liabilities shall be read into this Agreement or otherwise exist against such
Person in such capacity. Each Lead Arranger shall at all times have the right to
receive current copies of the Register and any other information relating to the
Lenders and the Loans that they may request from the Administrative Agent. Each
Lead Arranger shall at all times have the right to receive a current copy of the
Register and any other information relating to the Lenders and the Loans that
they may request from the Administrative Agent.
     SECTION 9.11 Posting of Approved Electronic Communications.
     (a) The Borrower hereby agrees, unless directed otherwise by the
Administrative Agent or unless the electronic mail address referred to below has
not been provided by the Administrative Agent to the Borrower, that it will, or
will cause its Subsidiaries to, provide to the Administrative Agent all
information, documents and other materials that it is obligated to furnish to
the Administrative Agent pursuant to the Loan
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Documents or to the Lenders under Section 7.1.1, including all notices,
requests, financial statements, financial and other reports, certificates and
other information materials, but excluding any such communication that (i) is or
relates to a Borrowing Request, a Continuation/Conversion Notice or an Issuance
Request, (ii) relates to the payment of any principal or other amount due under
this Agreement prior to the scheduled date therefor and (iii) provides notice of
any Default (all such non-excluded communications being referred to herein
collectively as “Communications”), by transmitting the Communications in an
electronic/soft medium that is properly identified in a format reasonably
acceptable to the Administrative Agent to an electronic mail address as directed
by the Administrative Agent; provided for the avoidance of doubt the items
described in clauses (i) and (iii) above may be delivered via facsimile
transmissions. In addition, the Borrower agrees, and agrees to cause its
Subsidiaries, to continue to provide the Communications to the Administrative
Agent or the Lenders, as the case may be, in the manner specified in the Loan
Documents but only to the extent requested by the Administrative Agent.
     (b) The Borrower further agrees that the Administrative Agent may make the
Communications available to the Lenders by posting the Communications on
Intralinks or a substantially similar secure electronic transmission system (the
“Platform”).
     (c) THE PLATFORM IS PROVIDED “AS IS” AND “AS AVAILABLE”. THE INDEMNIFIED
PARTIES DO NOT WARRANT THE ACCURACY OR COMPLETENESS OF THE COMMUNICATIONS OR THE
ADEQUACY OF THE PLATFORM AND EXPRESSLY DISCLAIM LIABILITY FOR ERRORS OR
OMISSIONS IN THE COMMUNICATIONS. 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 THE INDEMNIFIED PARTIES IN CONNECTION WITH THE
COMMUNICATIONS OR THE PLATFORM. IN NO EVENT SHALL ANY PARTY HERETO HAVE ANY
LIABILITY TO ANY OBLIGOR, ANY LENDER OR ANY OTHER PERSON FOR DAMAGES OF ANY
KIND, WHETHER OR NOT BASED ON STRICT LIABILITY AND INCLUDING DIRECT OR INDIRECT,
SPECIAL, INCIDENTAL OR CONSEQUENTIAL DAMAGES, LOSSES OR EXPENSES (WHETHER IN
TORT, CONTRACT OR OTHERWISE) ARISING OUT OF ANY OBLIGOR’S OR THE ADMINISTRATIVE
AGENT’S TRANSMISSION OF COMMUNICATIONS THROUGH THE INTERNET, EXCEPT TO THE
EXTENT THE LIABILITY OF SUCH PERSON IS FOUND IN A FINAL RULING BY A COURT OF
COMPETENT JURISDICTION TO HAVE RESULTED PRIMARILY FROM SUCH INDEMNIFIED PARTY’S
GROSS NEGLIGENCE OR WILLFUL MISCONDUCT.
     (d) The Administrative Agent agrees that the receipt of the Communications
by the Administrative Agent at the e-mail address set forth on Schedule II shall
constitute effective delivery of the Communications to the Administrative Agent
for purposes of the Loan Documents. Each Lender agrees that receipt of notice to
it (as provided in the next sentence) specifying that the Communications have
been posted to the Platform shall
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constitute effective delivery of the Communications to such Lender for purposes
of the Loan Documents. Each Lender agrees to notify the Administrative Agent in
writing (including by electronic communication) from time to time of such
Lender’s e-mail address to which the foregoing notice may be sent by electronic
transmission and that the foregoing notice may be sent to such e-mail address.
     (e) Nothing herein shall prejudice the right of any Agent or any Lender to
give any notice or other communication pursuant to any Loan Document in any
other manner specified in such Loan Document.
ARTICLE X
MISCELLANEOUS PROVISIONS
     SECTION 10.1 Waivers, Amendments, etc. The provisions of each Loan Document
(other than Rate Protection Agreements, Letters of Credit or the Fee Letter,
which shall be modified only in accordance with their respective terms) may from
time to time be amended, modified or waived, if such amendment, modification or
waiver is in writing and consented to by the Borrower and the Required Lenders;
provided that, no such amendment, modification or waiver shall:
     (a) modify Section 4.7, Section 4.8 (as it relates to sharing of payments)
or this Section, in each case, without the consent of all Lenders;
     (b) increase the aggregate amount of any Loans required to be made by a
Lender pursuant to its Commitments, extend the final Commitment Termination Date
of Loans made (or participated in) by a Lender or extend the final Stated
Maturity Date for any Lender’s Loan, in each case without the consent of such
Lender (it being agreed, however, that any vote to rescind any acceleration made
pursuant to Section 8.2 and Section 8.3 of amounts owing with respect to the
Loans and other Obligations shall only require the vote of the Required
Lenders);
     (c) reduce (by way of forgiveness), the principal amount of or reduce the
rate of interest on any Lender’s Loan, reduce any fees described in Article III
payable to any Lender or extend the date on which interest, principal or fees
are payable in respect of such Lender’s Loans, in each case without the consent
of such Lender (provided that, the vote of Required Lenders shall be sufficient
to waive the payment, or reduce the increased portion, of interest accruing
under Section 3.2.2 and such waiver shall not constitute a reduction of the rate
of interest hereunder);
     (d) reduce the percentage set forth in the definition of “Required Lenders”
or modify any requirement hereunder that any particular action be taken by all
Lenders without the consent of all Lenders;
     (e) increase the Stated Amount of any Letter of Credit unless consented to
by the Issuer of such Letter of Credit;
     (f) except as otherwise expressly provided in a Loan Document, release
(i) the Borrower from its Obligations under the Loan Documents or any Subsidiary
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Guarantor from its obligations under the Guaranty or (ii) all or substantially
all of the collateral under the Loan Documents, in each case without the consent
of all Lenders; or
     (g) affect adversely the interests, rights or obligations of the
Administrative Agent (in its capacity as the Administrative Agent), the
Collateral Agent (in its capacity as the Collateral Agent) any Issuer (in its
capacity as Issuer), or the Swing Line Lender (in its capacity as Swing Line
Lender) unless consented to by such Agent or such Issuer, as the case may be.
No failure or delay on the part of any Secured Party in exercising any power or
right under any Loan Document shall operate as a waiver thereof, nor shall any
single or partial exercise of any such power or right preclude any other or
further exercise thereof or the exercise of any other power or right. No notice
to or demand on any Obligor in any case shall entitle it to any notice or demand
in similar or other circumstances. No waiver or approval by any Secured Party
under any Loan Document shall, except as may be otherwise stated in such waiver
or approval, be applicable to subsequent transactions. No waiver or approval
hereunder shall require any similar or dissimilar waiver or approval thereafter
to be granted hereunder.
Notwithstanding the foregoing, this Agreement may be amended (or amended and
restated) with the written consent of the Required Lenders, and the Borrower
(a) to add one or more additional credit facilities to this Agreement and to
permit the extensions of credit from time to time outstanding thereunder and the
accrued interest and fees in respect thereof to share ratably in the benefits of
this Agreement and the other Loan Documents with the Obligations and (b) to
include appropriately the Lenders holding such credit facilities in any
determination of the Required Lenders.
Further, notwithstanding anything to the contrary contained in Section 10.1, if
within sixty days following the Closing Date, the Administrative Agent and the
Borrower shall have jointly identified an obvious error or any error or omission
of a technical or immaterial nature, in each case, in any provision of the Loan
Documents, then the Administrative Agent and the Borrower shall be permitted to
amend such provision and such amendment shall become effective without any
further action or consent of any other party to any Loan Document if the same is
not objected to in writing by the Required Lenders within five Business Days
following receipt of notice thereof.
     SECTION 10.2 Notices; Time. All notices and other communications provided
under each Loan Document shall be in writing or by facsimile (except to the
extent provided below in this Section 10.2 with respect to Issuance Requests and
financial information) and addressed, delivered or transmitted, if to the
Borrower, an Agent, a Lender or an Issuer, to the applicable Person at its
address or facsimile number set forth on the signature pages hereto, Schedule II
hereto or set forth in the Lender Assignment Agreement, or at such other address
or facsimile number as may be designated by such party in a notice to the other
parties. Any notice, if mailed and properly addressed with postage prepaid or if
properly addressed and sent by pre-paid courier service, shall be deemed given
when received; any notice, if transmitted by facsimile, shall be deemed given
when the confirmation of transmission thereof is received by the transmitter.
Except as set forth in Section 9.11 and below, electronic mail and Internet and
intranet websites may be used only to distribute routine communications by the
Administrative
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Agent to the Lender, such as financial statements and other information as
provided in Section 7.1.1 , for the distribution and execution of Loan Documents
for execution by the parties thereto and (to the extent provided herein, for the
delivery of each Issuance Request) and may not be used for any other purpose.
Notwithstanding the foregoing, the parties hereto agree that delivery of an
executed counterpart of a signature page to this Agreement and each other Loan
Document by facsimile (or other electronic) transmission shall be effective as
delivery of an original executed counterpart of this Agreement or such other
Loan Document. Unless otherwise indicated, all references to the time of a day
in a Loan Document shall refer to New York time.
     SECTION 10.3 Payment of Costs and Expenses. The Borrower agrees to pay
within 20 days of demand (to the extent invoiced together with reasonably
detailed supporting documentation) all reasonable out-of-pocket expenses of each
Lead Arranger and each Agent (including the reasonable fees and reasonable
out-of-pocket expenses of Mayer, Brown, Rowe & Maw LLP, counsel to the Lead
Arrangers and Agents and of local counsel, if any, who may be retained by or on
behalf of the Lead Arrangers and Agents) and each Issuer in connection with
     (a) the negotiation, preparation, execution and delivery of each Loan
Document, including schedules and exhibits, and any amendments, waivers,
consents, supplements or other modifications to any Loan Document as may from
time to time hereafter be required, whether or not the transactions contemplated
hereby are consummated; and
     (b) the filing or recording of any Loan Document (including any Filing
Statements) and all amendments, supplements, amendment and restatements and
other modifications to any thereof, searches made following the Closing Date in
jurisdictions where Filing Statements (or other documents evidencing Liens in
favor of the Secured Parties) have been recorded and any and all other documents
or instruments of further assurance required to be filed or recorded by the
terms of any Loan Document; and
     (c) the preparation and review of the form of any document or instrument
relevant to any Loan Document.
The Borrower further agrees to pay, and to save each Secured Party harmless from
all liability for, any stamp or other taxes which may be payable in connection
with the execution or delivery of each Loan Document, the Credit Extensions or
the issuance of the Notes. The Borrower also agrees to reimburse the Agents and
the Secured Parties upon demand for all reasonable out-of-pocket expenses
(including reasonable attorneys’ fees and legal out of pocket expenses of
counsel to the Agents and the Secured Parties) incurred by the Agents and the
Secured Parties in connection with (A) the negotiation of any restructuring or
“work-out” with the Borrower, whether or not consummated, of any Obligations and
(B) the enforcement of any Obligations; provided that the Borrower shall not be
required to reimburse the legal fees and expenses of more than one outside
counsel (in addition to any local counsel) for all Persons indemnified under
this Section 10.3 unless, as reasonably determined by such Person seeking
indemnification hereunder or its counsel, representation of all such indemnified
persons by the same counsel would be inappropriate due to actual or potential
differing interests between them.
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     SECTION 10.4 Indemnification. In consideration of the execution and
delivery of this Agreement by each Secured Party, the Borrower hereby
indemnifies, exonerates and holds each Secured Party, each Syndication Agent,
each Documentation Agent and each of their respective officers, directors,
employees, agents, trustees, fund advisors and Affiliates (collectively, the
“Indemnified Parties”) free and harmless from and against any and all actions,
causes of action, suits, losses, costs, liabilities and damages, and expenses
incurred in connection therewith (irrespective of whether any such Indemnified
Party is a party to the action for which indemnification hereunder is sought),
including reasonable attorneys’ fees and disbursements, whether incurred in
connection with actions between or among the parties hereto or the parties
hereto and third parties (collectively, the “Indemnified Liabilities”), incurred
by the Indemnified Parties or any of them as a result of, or arising out of, or
relating to
     (a) any transaction financed or to be financed in whole or in part,
directly or indirectly, with the proceeds of any Credit Extension, including all
Indemnified Liabilities arising in connection with the Transaction;
     (b) the entering into and performance of any Loan Document by any of the
Indemnified Parties (including any action brought by or on behalf of the
Borrower as the result of any determination by the Required Lenders pursuant to
Article V not to fund any Credit Extension, provided that, any such action is
resolved in favor of such Indemnified Party);
     (c) any investigation, litigation or proceeding related to any acquisition
or proposed acquisition by any Obligor or any Subsidiary thereof of all or any
portion of the Capital Securities or assets of any Person, whether or not an
Indemnified Party is party thereto;
     (d) any investigation, litigation or proceeding related to any
environmental cleanup, audit, compliance or other matter relating to the
protection of the environment or the Release by any Obligor or any Subsidiary
thereof of any Hazardous Material;
     (e) the presence on or under, or the escape, seepage, leakage, spillage,
discharge, emission, discharging or releases from, any real property owned or
operated by any Obligor or any Subsidiary thereof of any Hazardous Material
(including any losses, liabilities, damages, injuries, costs, expenses or claims
asserted or arising under any Environmental Law), regardless of whether caused
by, or within the control of, such Obligor or Subsidiary; or
     (f) each Lender’s Environmental Liability (the indemnification herein shall
survive repayment of the Obligations and any transfer of the property of any
Obligor or its Subsidiaries by foreclosure or by a deed in lieu of foreclosure
for any Lender’s Environmental Liability, regardless of whether caused by, or
within the control of, such Obligor or such Subsidiary);
except for (i) Indemnified Liabilities arising for the account of any
Indemnified Party by reason of any Indemnified Party’s gross negligence, bad
faith or willful misconduct as finally determined by a court of competent
jurisdiction, (ii) Indemnified Liabilities arising out of any
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action, suit, proceeding or claim against an Indemnified Party by any other
Indemnified Party not involving the Borrower or any of its Subsidiaries. The
Borrower shall not be required to reimburse the legal fees and expenses of more
than one outside counsel for all Indemnified Parties with respect to any matter
for which indemnification is sought unless, as reasonably determined by any such
Indemnified Party or its counsel, representation of all such Indemnified Parties
would create an actual conflict of interest. Each Obligor and its successors and
assigns hereby waive, release and agree not to make any claim or bring any cost
recovery action against, any Indemnified Party under CERCLA or any state
equivalent, or any similar law now existing or hereafter enacted. It is
expressly understood and agreed that to the extent that any Indemnified Party is
strictly liable under any Environmental Laws, each Obligor’s obligation to such
Indemnified Party under this indemnity shall likewise be without regard to fault
on the part of any Obligor with respect to the violation or condition which
results in liability of an Indemnified Party. If and to the extent that the
foregoing undertaking may be unenforceable for any reason, each Obligor agrees
to make the maximum contribution to the payment and satisfaction of each of the
Indemnified Liabilities which is permissible under applicable law. To the extent
that the Borrower fails to pay an amount required to be paid by it to an Issuer
under Section 10.3 or 10.4, each Revolving Loan Lender severally agrees to pay
to such Issuer such Revolving Loan Lender’s Revolving Loan Percentage
(determined as of the time that the applicable unreimbursed expense or indemnity
payment is sought) of such unpaid amount, provided that such unreimbursed
expense or indemnified loss, claim, damage, liability or related expense, as the
case may be, was incurred by or asserted against such Issuer in its capacity as
such.
     SECTION 10.5 Survival. The obligations of the Borrower under Sections 4.3,
4.4, 4.5, 4.6, 10.3 and 10.4, and the obligations of the Lenders under
Section 9.1, shall in each case survive any assignment from one Lender to
another (in the case of Sections 10.3 and 10.4) and the occurrence of the
Termination Date. The representations and warranties made by each Obligor in
each Loan Document shall survive the execution and delivery of such Loan
Document.
     SECTION 10.6 Severability. Any provision of any Loan Document which is
prohibited or unenforceable in any jurisdiction shall, as to such provision and
such jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions of such Loan
Document or affecting the validity or enforceability of such provision in any
other jurisdiction.
     SECTION 10.7 Headings. The various headings of each Loan Document are
inserted for convenience only and shall not affect the meaning or interpretation
of such Loan Document or any provisions thereof.
     SECTION 10.8 Execution in Counterparts, Effectiveness, etc. This Agreement
may be executed by the parties hereto in several counterparts, each of which
shall be an original and all of which shall constitute together but one and the
same agreement. This Agreement shall become effective when counterparts hereof
executed on behalf of the Borrower, each Agent and each Lender (or notice
thereof satisfactory to the Administrative Agent), shall have been received by
the Administrative Agent.
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     SECTION 10.9 Governing Law; Entire Agreement. EACH LOAN DOCUMENT (OTHER
THAN THE LETTERS OF CREDIT, TO THE EXTENT SPECIFIED BELOW AND EXCEPT AS
OTHERWISE EXPRESSLY SET FORTH IN A LOAN DOCUMENT) WILL EACH BE DEEMED TO BE A
CONTRACT MADE UNDER AND GOVERNED BY THE INTERNAL LAWS OF THE STATE OF NEW YORK
(INCLUDING FOR SUCH PURPOSE SECTIONS 5-1401 AND 5-1402 OF THE GENERAL
OBLIGATIONS LAW OF THE STATE OF NEW YORK). EACH LETTER OF CREDIT SHALL BE
GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OR RULES DESIGNATED IN
SUCH LETTER OF CREDIT, OR IF NO LAWS OR RULES ARE DESIGNATED, THE INTERNATIONAL
STANDBY PRACTICES (ISP98—INTERNATIONAL CHAMBER OF COMMERCE PUBLICATION NUMBER
590 (THE “ISP RULES”)) AND, AS TO MATTERS NOT GOVERNED BY THE ISP RULES, THE
INTERNAL LAWS OF THE STATE OF NEW YORK. The Loan Documents constitute the entire
understanding among the parties hereto with respect to the subject matter
thereof and supersede any prior agreements, written or oral, with respect
thereto.
     SECTION 10.10 Successors and Assigns. This Agreement shall be binding upon
and shall inure to the benefit of the parties hereto and their respective
successors and assigns; provided that, the Borrower may not assign or transfer
its rights or obligations hereunder without the consent of all Lenders. Each
Affiliate of HSBC or any other Lender that has issued a Letter of Credit
hereunder shall be an express third party beneficiary of this Agreement and
entitled to enforce its rights hereunder (and under any other applicable Loan
Documents) to the same extent as if an Issuer party hereto.
     SECTION 10.11 Sale and Transfer of Credit Extensions; Participations in
Credit Extensions; Notes. Each Lender may assign, or sell participations in, its
Loans, Letters of Credit and Commitments to one or more other Persons in
accordance with the terms set forth below.
     (a) Subject to clause (b), any Lender may assign to one or more Eligible
Assignees all or a portion of its rights and obligations under the Loan
Documents (including all or a portion of its Commitments and the Loans at the
time owing to it); provided that:
     (i) except in the case of (A) an assignment of the entire remaining amount
of the assigning Lender’s Commitments and the Loans at the time owing to it or
(B) an assignment to a Lender, an Affiliate of a Lender or an Approved Fund with
respect to a Lender, the aggregate amount of the Commitments (which for this
purpose includes Loans outstanding thereunder) or principal outstanding balance
of the Loans of the assigning Lender subject to each such assignment (determined
as of the date the Lender Assignment Agreement with respect to such assignment
is delivered to the Administrative Agent) shall not be less than $1,000,000,
unless the Administrative Agent and the Borrower, otherwise consent (which
consent shall not be unreasonably withheld or delayed);
     (ii) 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 and the Commitments assigned except
that this clause (a)(ii) shall not prohibit any Lender from assigning all or a
portion of its rights and obligations
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among separate tranches of Revolving Loans and Term Loans on a non-pro rata
basis; and
     (iii) the parties to each assignment shall execute and deliver to the
Administrative Agent a Lender Assignment Agreement, together with, if the
Eligible Assignee is not already Lender, administrative details information with
respect to such Eligible Assignee and applicable tax forms.
     (b) Any assignment proposed pursuant to clause (a) to any Person (other
than a Lender, an Approved Fund or an Affiliate of any Lender) shall be subject
to the prior written approval of (i) the Administrative Agent (not to be
unreasonably withheld or delayed) and (ii) in the case of any assignment of any
Revolving Loan Commitment, the Swing Line Lender and each Issuer (in each case
not to be unreasonably withheld or delayed). If the consent of the Borrower to
an assignment or to an Eligible Assignee is required hereunder (including a
consent to an assignment which does not meet the minimum assignment thresholds
specified in this Section), the Borrower shall be deemed to have given its
consent seven Business Days after the date notice thereof has been delivered by
the assigning Lender (through the Administrative Agent) to the Borrower, unless
such consent is expressly refused by the Borrower prior to such seventh Business
Day.
     (c) Subject to acceptance and recording thereof by the Administrative Agent
pursuant to clause (d), from and after the effective date specified in each
Lender Assignment Agreement, (i) the Eligible Assignee thereunder shall (if not
already a Lender) be a party hereto and, to the extent of the interest assigned
by such Lender Assignment Agreement, have the rights and obligations of a Lender
under the Loan Documents, and (ii) the assigning Lender thereunder shall
(subject to Section 10.5) be released from its obligations under the Loan
Documents, to the extent of the interest assigned by such Lender Assignment
Agreement (and, in the case of a Lender Assignment Agreement covering all of the
assigning Lender’s rights and obligations under the Loan Documents, such Lender
shall cease to be a party hereto, but shall (as to matters arising prior to the
effectiveness of the Lender Assignment Agreement) continue to be entitled to the
benefits of any provisions of the Loan Documents which by their terms survive
the termination of this Agreement). Any assignment or transfer by a Lender of
rights or obligations under this Agreement that does not comply with the terms
of this Section shall be treated for purposes of the Loan Documents as a sale by
such Lender of a participation in such rights and obligations in accordance with
clause (e).
     (d) The Administrative Agent shall record each assignment made in
accordance with this Section in the Register pursuant to clause (a) of
Section 2.7. The Register shall be available for inspection by the Borrower and
any Lender, at any reasonable time upon reasonable prior notice to the
Administrative Agent.
     (e) Any Lender may, without the consent of, or notice to, any Person, sell
participations to one or more Persons (other than individuals) (a “Participant”)
in all or a portion of such Lender’s rights or obligations under the Loan
Documents (including all or a portion of its Commitments or the Loans owing to
it); provided that, (i) such Lender’s obligations under the Loan Documents shall
remain unchanged, (ii) such Lender shall remain solely responsible to the other
parties hereto for the performance of such obligations and (iii) the Borrower,
the Administrative Agent
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and the other Lenders shall continue to deal solely and directly with such
Lender in connection with such Lender’s rights and obligations under the Loan
Documents. Any agreement or instrument pursuant to which a Lender sells a
participation shall provide that such Lender shall retain the sole right to
enforce the rights and remedies of a Lender under the Loan Documents and to
approve any amendment, modification or waiver of any provision of the Loan
Documents; provided that, such agreement or instrument may provide that such
Lender will not, without the consent of the Participant, take any action of the
type described in clauses (a) through (d) or clause (f) of Section 10.1 with
respect to Obligations participated in by that Participant. Subject to clause
(f), the Borrower agrees that each Participant shall be entitled to the benefits
of Sections 4.3, 4.4, 4.5, 4.6, 7.1.1, 10.3 and 10.4 to the same extent as if it
were a Lender and had acquired its interest by assignment pursuant to clause
(c). To the extent permitted by law, each Participant also shall be entitled to
the benefits of Section 4.9 as though it were a Lender, but only if such
Participant agrees to be subject to Section 4.8 as though it were a Lender.
     (f) A Participant shall not be entitled to receive any greater payment
under Section 4.3, 4.4, 4.5, 4.6, 10.3 or 10.4 than the applicable Lender would
have been entitled to receive with respect to the participation sold to such
Participant, unless the sale of the participation to such Participant is made
with the Borrower’s prior written consent. A Participant that would be a
Non-U.S. Lender if it were a Lender shall not be entitled to the benefits of
Section 4.6 unless the Borrower is notified of the participation sold to such
Participant and such Participant agrees, for the benefit of the Borrower, to
comply with the requirements set forth in Section 4.6 as though it were a
Lender. Any Lender that sells a participating interest in any Loan, Commitment
or other interest to a Participant under this Section shall indemnify and hold
harmless the Borrower and the Administrative Agent from and against any taxes,
penalties, interest or other costs or losses (including reasonable attorneys’
fees and expenses) incurred or payable by the Borrower or the Administrative
Agent as a result of the failure of the Borrower or the Administrative Agent to
comply with its obligations to deduct or withhold any Taxes from any payments
made pursuant to this Agreement to such Lender or the Administrative Agent, as
the case may be, which Taxes would not have been incurred or payable if such
Participant had been a Non-U.S. Lender that was entitled to deliver to the
Borrower, the Administrative Agent or such Lender, and did in fact so deliver, a
duly completed and valid Form W-8BEN or W-8ECI (or applicable successor form)
entitling such Participant to receive payments under this Agreement without
deduction or withholding of any United States federal taxes.
     (g) Any Lender may, without the consent of any other Person, at any time
pledge or assign a security interest in all or any portion of its rights under
this Agreement to secure obligations of such Lender, including any pledge or
assignment to secure obligations to a Federal Reserve Bank; provided that no
such pledge or assignment of a security interest shall release a Lender from any
of its obligations hereunder or substitute any such pledgee or assignee for such
Lender as a party hereto.
     SECTION 10.12 Other Transactions. Nothing contained herein shall preclude
any Agent, any Issuer or any other Lender from engaging in any transaction, in
addition to those contemplated by the Loan Documents, with the Borrower or any
of its Affiliates in which the Borrower or such Affiliate is not restricted
hereby from engaging with any other Person.
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     SECTION 10.13 Forum Selection and Consent to Jurisdiction. ANY LITIGATION
BASED HEREON, OR ARISING OUT OF, UNDER, OR IN CONNECTION WITH, ANY LOAN
DOCUMENT, OR ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER ORAL
OR WRITTEN) OR ACTIONS OF THE AGENTS, THE LENDERS, ANY ISSUER OR THE BORROWER IN
CONNECTION HEREWITH OR THEREWITH MAY BE BROUGHT AND MAINTAINED IN THE COURTS OF
THE STATE OF NEW YORK OR IN THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN
DISTRICT OF NEW YORK; PROVIDED THAT, ANY SUIT SEEKING ENFORCEMENT AGAINST ANY
COLLATERAL OR OTHER PROPERTY MAY BE BROUGHT, AT THE COLLATERAL AGENT’S OPTION,
IN THE COURTS OF ANY JURISDICTION WHERE SUCH COLLATERAL OR OTHER PROPERTY MAY BE
FOUND. THE BORROWER IRREVOCABLY CONSENTS TO THE SERVICE OF PROCESS BY REGISTERED
MAIL, POSTAGE PREPAID, OR BY PERSONAL SERVICE WITHIN OR WITHOUT THE STATE OF NEW
YORK AT THE ADDRESS FOR NOTICES SPECIFIED IN SECTION 10.2. EACH PERSON PARTY
HERETO HEREBY EXPRESSLY AND IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED
BY LAW, ANY OBJECTION WHICH IT MAY HAVE OR HEREAFTER MAY HAVE TO THE LAYING OF
VENUE OF ANY SUCH LITIGATION BROUGHT IN ANY SUCH COURT REFERRED TO ABOVE AND ANY
CLAIM THAT ANY SUCH LITIGATION HAS BEEN BROUGHT IN AN INCONVENIENT FORUM. TO THE
EXTENT THAT ANY PERSON PARTY HERETO HAS OR HEREAFTER MAY ACQUIRE ANY IMMUNITY
FROM JURISDICTION OF ANY COURT OR FROM ANY LEGAL PROCESS (WHETHER THROUGH
SERVICE OR NOTICE, ATTACHMENT PRIOR TO JUDGMENT, ATTACHMENT IN AID OF EXECUTION
OR OTHERWISE) WITH RESPECT TO ITSELF OR ITS PROPERTY, SUCH PERSON HEREBY
IRREVOCABLY WAIVES TO THE FULLEST EXTENT PERMITTED BY LAW SUCH IMMUNITY IN
RESPECT OF ITS OBLIGATIONS UNDER THE LOAN DOCUMENTS.
     SECTION 10.14 Waiver of Jury Trial. EACH AGENT, EACH LENDER, EACH ISSUER
AND THE BORROWER HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVE TO THE
FULLEST EXTENT PERMITTED BY LAW ANY RIGHTS THEY MAY HAVE TO A TRIAL BY JURY IN
RESPECT OF ANY LITIGATION BASED HEREON, OR ARISING OUT OF, UNDER, OR IN
CONNECTION WITH, EACH LOAN DOCUMENT, OR ANY COURSE OF CONDUCT, COURSE OF
DEALING, STATEMENTS (WHETHER ORAL OR WRITTEN) OR ACTIONS OF SUCH AGENT, SUCH
LENDER, SUCH ISSUER OR THE BORROWER IN CONNECTION THEREWITH. THE BORROWER
ACKNOWLEDGES AND AGREES THAT IT HAS RECEIVED FULL AND SUFFICIENT CONSIDERATION
FOR THIS PROVISION (AND EACH OTHER PROVISION OF EACH OTHER LOAN DOCUMENT TO
WHICH IT IS A PARTY) AND THAT THIS PROVISION IS A MATERIAL INDUCEMENT FOR EACH
AGENT, EACH LENDER AND EACH ISSUER ENTERING INTO THE LOAN DOCUMENTS.
     SECTION 10.15 Patriot Act. Each Lender that is subject to Section 326 of
the Patriot Act and/or the Agents and/or the Lead Arrangers (each of the
foregoing acting for themselves and not acting on behalf of any of the Lenders)
hereby notify the Borrower that pursuant to the requirements of the Patriot Act,
it is required to obtain, verify and record information that identifies the
Borrower, which information includes the name and address of the Borrower and
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other information that will allow such Lender, the Agents or the Lead Arrangers,
as the case may be, to identify the Borrower in accordance with the Patriot Act.
     SECTION 10.16 Judgment Currency. The Obligations of each Obligor in respect
of any sum due to any Secured Party under or in respect of any Loan Document
shall, notwithstanding any judgment in a currency (the “Judgment Currency”)
other than the currency in which such sum was originally denominated (the
“Original Currency”), be discharged only to the extent that on the Business Day
following receipt by such Secured Party or any sum adjudged to be so due in the
Judgment Currency, such Secured Party, in accordance with normal banking
procedures, purchases the Original Currency with the Judgment Currency. If the
amount of Original Currency so purchased is less than the sum originally due to
such Secured Party, the Borrower agrees, as a separate obligation and
notwithstanding any such judgment, to indemnify such Lender, such Secured Party,
as the case may be, against such loss, and if the amount of Original Currency so
purchased exceeds the sum originally due to such Secured Party, as the case may
be, such Secured Party, as the case may be, agrees to remit such excess to the
Borrower.
     SECTION 10.17 Counsel Representation. EACH PARTY HERETO ACKNOWLEDGES AND
AGREES THAT IT HAS BEEN REPRESENTED BY COMPETENT COUNSEL IN THE NEGOTIATION OF
THIS AGREEMENT, AND THAT ANY RULE OR CONSTRUCTION OF LAW ENABLING SUCH PERSON TO
ASSERT THAT ANY AMBIGUITIES OR INCONSISTENCIES IN THE DRAFTING OR PREPARATION OF
THE TERMS OF THIS AGREEMENT SHOULD DIMINISH ANY RIGHTS OR REMEDIES OF ANY OTHER
PERSON ARE HEREBY WAIVED.
     SECTION 10.18 Confidentiality. Each Secured Party 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
(it being understood that the Persons to whom such disclosure is made will be
informed of the confidential nature of such Information and instructed to keep
such Information confidential), (b) to the extent requested by any regulatory
authority 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 (provided that except to the extent prohibited by such
subpoena or similar legal process, such Secured Party shall notify the Borrower
of such request or disclosure), (d) to any other party hereto, (e) to the extent
reasonably necessary, 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 (i) any assignee of or Participant in, or any
prospective assignee of or Participant in, any of its rights or obligations
under this Agreement or (ii) any actual or prospective counterparty (or its
advisors) to any swap or derivative transaction relating to the Borrower and its
obligations, (g) with the written consent of the Borrower or (h) to the extent
such Information (i) becomes publicly available other than as a result of a
breach of this Section (or any other confidentiality obligation owed to the
Borrower or any Subsidiary or their Affiliates) or (ii) becomes available to any
Secured Party or any of their respective Affiliates on a nonconfidential basis
from a source other than the Borrower or any Subsidiary and not in violation of
any confidentiality obligation owed to the Borrower or any
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Subsidiary by any Secured Party or any Affiliate thereof. For purposes of this
Section, “Information” means all information received from the Borrower or any
Subsidiary relating to the Borrower or any Subsidiary or any of their respective
businesses, other than any such information that is available to any Secured
Party on a nonconfidential basis prior to disclosure by the Borrower or any
Subsidiary. 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 and in accordance with applicable law.
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     IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their respective officers thereunto duly authorized as of the day
and year first above written.

            HANESBRANDS INC.
      By:   /s/ Richard Moss         Name:   Richard Moss        Title:  
Treasurer     

         
 
  Address:   1000 East Hanes Mills Road
 
      Winston-Salem, NC 27105
 
            Facsimile No.: 336-519-5212     Attention: Treasurer

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            CITICORP USA, INC.,
Individually and as the Administrative Agent and as a Lender
      By:   /s/ John Coons         Name:   John Coons        Title:   Managing
Director     

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            CITIBANK, N.A.,
       as Collateral Agent
      By:   /s/ Patricia Gallagher         Name:   Patricia Gallagher       
Title:   Vice President     

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            MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED,
       as Co-Syndication Agent and Joint Lead Arranger
      By:   /s/ Nancy Meadows         Name:   Nancy Meadows        Title:   Vice
President        MERRILL LYNCH CAPITAL CORPORATION,
as a Lender
      By:   /s/ Nancy Meadows         Name:   Nancy Meadows        Title:   Vice
President     

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            MORGAN STANLEY SENIOR FUNDING, INC.,
       Individually, as Co-Syndication Agent,
       Joint Lead Arranger and as a Lender
      By:   /s/ Jaap L. Tonckens         Name:   Jaap L. Tonckens       
Title:   Vice President     

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            HSBC BANK USA, NATIONAL ASSOCIATION,
       as Co-Documentation Agent, an Issuer and as a Lender
      By:   /s/ Robert J. Devir         Name:   Robert J. Devir        Title:  
Senior Vice President     

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            LASALLE BANK NATIONAL ASSOCIATION,
       as Co-Documentation Agent and as a Lender
      By:   /s/ Terrence Wervel         Name:   Terrence Wervel        Title:  
Senior Vice President     

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            BARCLAYS BANK PLC,
        as Co-Documentation Agent and as a Lender
      By:   /s/ David Barton         Name:   David Barton        Title:  
Associate Director     

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            BAYERISCHE LANDESBANK, NEW YORK BRANCH,
       as a Lender
      By:   /s/ Stuart Schulman         Name:   Stuart Schulman        Title:  
Senior Vice President              By:   /s/ Norman McCleve         Name:  
Norman McCleve        Title:   First Vice President     

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            BNP PARIBAS,
       as a Lender
      By:   /s/ Nuala Marley         Name:   Nuala Marley        Title:  
Managing Director              By:   /s/ Angela B. Arnold         Name:   Angela
B. Arnold        Title:   Director     

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            BRANCH BANKING & TRUST COMPANY,
       as a Lender
      By:   /s/ Michael P. Gwyn         Name:   Michael P. Gwyn        Title:  
Senior Vice President     

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            COMMERZBANK AG, NEW YORK AND GRAND CAYMAN BRANCHES,
       as a Lender
      By:   /s/ Maritine I. Medora         Name:   Maritine I. Medora       
Title:   Senior Vice President              By:   /s/ Charles W. Polet        
Name:   Charles W. Polet        Title:   Assistant Treasurer     

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            ISRAEL DISCOUNT BANK OF NEW YORK,
       as a Lender
      By:   /s/ Andy Balita         Name:   Andy Balita        Title:   First
Vice President              By:   /s/ Ronald Bongiovanni         Name:   Ronald
Bongiovanni        Title:   Senior Vice President     

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            JPMORGAN CHASE BANK, N.A.,
       as a Lender
      By:   /s/ James A Knight         Name:   James A. Knight        Title:  
Vice President     

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            MIZUHO CORPORATE BANK, LTD.,
        as a Lender
      By:   /s/ Makoto Murata         Name:   Makoto Murata        Title:  
Deputy General Manager     

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            NATIONAL CITY BANK,
        as a Lender
      By:   /s/ Michael S. Pearl         Name:   Michael S. Pearl       
Title:   Account Officer     

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            NORTH FORK BUSINESS CAPITAL CORP.,
       as a Lender
      By:   /s/ Ron Walker         Name:   Ron Walker        Title:   Vice
President     

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            SUMITOMO MITSUI BANKING CORPORATION, NEW YORK,
        as a Lender
      By:   /s/ Shigeru Tsuru         Name:   Shigeru Tsuru        Title:  
Joint General Manager     

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            THE NORTHERN TRUST COMPANY,
        as a Lender
      By:   /s/ Peter J. Hallan         Name:   Peter J. Hallan        Title:  
Vice President     

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            THE ROYAL BANK OF SCOTLAND, PLC
       as a Lender
      By:   /s/ Belinda Wheeler         Name:   Belinda Wheeler        Title:  
Senior Vice President
      Global Banking & Markets     

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            UNITED OVERSEAS BANK LIMITED, NEW YORK AGENCY,
        as a Lender
      By:   /s/ George Lim / Mario Sheng         Name:   George Lim/Mario Sheng 
      Title:   FVP & GM / AVP     

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SCHEDULE I
DISCLOSURE SCHEDULES
TO
FIRST LIEN CREDIT AGREEMENT
dated as of September 5, 2006,
among
HANESBRANDS INC.,
as the Borrower,
VARIOUS FINANCIAL INSTITUTIONS AND
OTHER PERSONS FROM TIME TO TIME
PARTY HERETO,
as the Lenders,
HSBC BANK USA, NATIONAL ASSOCIATION,
LASALLE BANK NATIONAL ASSOCIATION, and
BARCLAYS BANK PLC,
as the Co-Documentation Agents,
MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED
and
MORGAN STANLEY SENIOR FUNDING, INC.,
as the Co-Syndication Agents,
CITICORP USA, INC.,
as the Administrative Agent,
and
CITIBANK, N.A., as the Collateral Agent.
 
MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED
and
MORGAN STANLEY SENIOR FUNDING, INC.,
as the Joint Lead Arrangers and Joint Bookrunners
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SCHEDULE I
   
 
   
ITEM 1.1.
  Foreign Supply Chain Entities
ITEM 1.2.
  Excluded Contracts
ITEM 6.8.
  Existing Subsidiaries
ITEM 6.9.
  Mortgaged Property
ITEM 7.2.2(c)
  Ongoing Indebtedness
ITEM 7.2.3(c)
  Ongoing Liens
ITEM 7.2.5(a)
  Ongoing Investments
ITEM 7.2.11(m)
  Permitted Dispositions
 
   
SCHEDULE II
  Percentages, Libor Office, Domestic Office
 
   
SCHEDULE III
  Existing Letters of Credit

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ITEM 1.1. Foreign Supply Chain Entities
     None.
First Lien Credit Agreement

 

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ITEM 1.2. Excluded Contracts

          Vendor   Nature of Agreement
1.
  [*****]   Trademark License Agmt. [*****]
2.
  [*****]   Trademark License Agmt. [*****]
3.
  [*****]   Trademark License Agmt. [*****]
4.
  [*****]   Trademark License Agmt. [*****]
5.
  [*****]   Trademark License Agmt. [*****]
6.
  [*****]   Trademark License Agmt. [*****]
7.
  [*****]   Trademark License Agmt. [*****]
8.
  [*****]   License Agmt.
9.
  [*****]   Trademark License Agmt. [*****]
10.
  [*****]   License Agmt. [*****]
11.
  [*****]   Trademark License Agreement [*****]
12.
  [*****]    
13.
  [*****]   IT Agreement — software license and maintenance
14.
  [*****]   IT Agreement — software license and maintenance
15.
  [*****]   IT Agreement — supply chain software license and maintenance
16.
  [*****]   Compensation/Benefits Agreement
17.
  [*****]   Real Property Lease [*****]
18.
  [*****]   Supplier Services [*****]
19.
  [*****]   Supplier Goods [*****]
20.
  [*****]   Real Property Lease [*****]
21.
  [*****]   Real Property Lease [*****]
22.
  [*****]   Real Property Lease [*****]
23.
  [*****]   Real Property Lease [*****]
24.
  [*****]   Real Property Lease [*****]
25.
  [*****]   Real Property Lease [*****]
26.
  [*****]   Real Property Lease [*****]
27.
  [*****]   Real Property Lease
28.
  [*****]   Real Property Lease
29.
  [*****]   Real Property Lease [*****]

First Lien Credit Agreement

 

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

 

ITEM 6.8. Existing Subsidiaries
Domestic Subsidiaries
BA International, L.L.C.
Caribesock, Inc.
Caribetex, Inc.
CASA International, LLC
Ceibena Del, Inc.
Hanes Menswear, LLC
Hanes Puerto Rico, Inc.
Hanesbrands Direct, LLC
Hanesbrands Distribution, Inc.
HbI International, LLC
HBI Branded Apparel Enterprises, LLC
HBI Branded Apparel Limited, Inc.
HBI Sourcing, LLC
Inner Self LLC
Jasper-Costa Rica, L.L.C.
National Textiles, L.L.C.
NT Investment Company, Inc.
Playtex Dorado, LLC
Playtex Industries, Inc.
Seamless Textiles, LLC
UPCR, Inc.
UPEL, Inc.
Foreign Subsidiaries
Allende Internacional S. de R.L. de C.V.
Bali Domincana, Inc.
Bali Dominicana Textiles, S.A.
Bal-Mex S. de R.L de C.V.
Canadelle Holdings Corporation Ltd.
Canadelle LP
Cartex Manufacturera S. A.
Caysock, Inc.
Caytex, Inc.
Caywear, Inc.
Ceiba Industrial, S. de R.L.
Champion Products S. de R.L. de C.V.
Choloma, Inc.
Confecciones Atlantida S. de R.L.
Confecciones de Nueva Rosita S. de R.L. de C.V.
Confecciones El Pedregal Inc.
Confecciones El Pedregal S.A. de C.V.
Confecciones Jiboa S.A. de C.V.
Confecciones La Caleta, Inc.
Confecciones La Herradura S.A. de C.V.
Confecciones La Libertad, S.A. de C.V.
DFK International Ltd.
Dos Rios Enterprises, Inc.
Hanes Caribe, Inc.
Hanes Choloma, S. de R. L.
Hanes Colombia, S.A.
Hanes de Centro America S.A.

First Lien Credit Agreement

 

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Foreign Subsidiaries
Hanes de El Salvador, S.A. de C.V.
Hanes de Honduras S. de R.L. de C.V.
Hanes Dominican, Inc.
Hanes Panama Ltd.
Hanes Brands Incorporated de Costa Rica, S.A.
Hanesbrands Argentina S.A.
Hanesbrands Brasil Textil Ltda.
Hanesbrands Dominicana, Inc.
Hanesbrands (HK) Limited
HBI Alpha Holdings, Inc.
HBI Beta Holdings, Inc.
HBI Compania de Servicios, S.A. de C.V.
HBI Servicios Administrativos de Costa Rica, S.A.
HBI Socks de Honduras, S. de R.L. de C.V.
Indumentaria Andina S.A.
Industria Textileras del Este, S. de R.L.
Industrias Internacionales de San Pedro S. de R.L. de C.V.
J.E. Morgan de Honduras, S.A.
Jasper Honduras, S.A.
Jogbra Honduras, S.A.
Madero Internacional S. de R.L. de C.V.
Manufacturera Ceibena S. de R.L.
Manufacturera Comalapa S.A. de C.V.
Manufacturera de Cartago, S.R.L.
Manufacturera San Pedro Sula, S. de R.L.
Monclova Internacional S. de R.L. de C.V.
PT SL Sourcing Indonesia (to be named PT HBI Sourcing Indonesia)
PTX (D.R.), Inc.
Rinplay S. de R.L. de C.V.
Santiago Internacional Textil Limitada (in liquidation)
Sara Lee of Canada NSULC (to be renamed Hanesbrands Canada NSULC)
Sara Lee Intimates, S. de R.L. (to be renamed Confecciones del Valle, S. de R.L.
de C.V.)
Sara Lee Japan Ltd. (to be renamed Hanesbrands Japan Inc.)
Sara Lee Knit Products Mexico S.A. de C.V. (to be renamed Inmobilaria Rinplay S.
de R.L. de C.V.)
Sara Lee Moda Femenina, S.A. de C.V. (to be renamed Servicios Rinplay, S. de R.L
de C.V.)
Sara Lee Printables GmbH (to be renamed HBI Europe GmbH)
Servicios de Soporte Intimate Apparel, S de RL
Socks Dominicana S.A.
Texlee El Salvador, S.A. de C.V.
The Harwood Honduras Companies, S. de R.L.
TOS Dominicana, Inc.
HBI Sourcing Asia Limited*
Sara Lee Apparel International (Shanghai) Co. Ltd. (to be renamed Hanesbrands
International (Shanghai) Co. Ltd.)*
Sara Lee Apparel India Private Limited (to be renamed Hanesbrands India Private
Limited)*
SL Sourcing India Private Ltd. (to be renamed HBI Sourcing India Private Ltd.)*
Hanesbrands (Thailand) Ltd.*
Hanesbrands Philippines Inc.*
 

*   These companies are Foreign Subsidiaries subject to the completion of the
post closing obligations set forth in Section 7.1.11 of the Credit Agreement.

First Lien Credit Agreement

 

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

 

ITEM 6.9. Mortgaged Property

                  Estimated Facility Name   Address   Value
 
  Cline & Clark Rd    
Clarksville
  Clarksville, AR   $2.4 million
 
  401 Hanes Mill Rd    
Weeks
  W-S, NC   $15.1 million
 
  700 South Stratford Road    
Stratford Rd.
  W-S, NC   $5.7 million
 
  219 Commerce Blvd    
Commerce (Cleveland)
  Kings Mountain, NC   $11.0 million
 
  Gant Road    
Eden
  Eden, North Carolina   $3.0 million
 
  1000 Hanes Mill Road    
Oak Summit
  W-S, NC   $70.2 million
 
  705 Canterbury Rd    
Canterbury
  Gastonia, NC   $2.1 million
 
  2655 Annapolis    
Annapolis
  W-S, NC   $7.9 million
 
  700 North Main Street    
Kernersville
  Kernersville, NC   $3.9 million
 
  18400 Fieldcrest Road    
Laurel Hill
  Laurel Hill, NC   $4.6 million
 
  2652 Dalrymple Street    
Sanford
  Sanford, NC   $2.4 million
 
  2016 Cornatzer Road    
Advance
  Advance NC   $2.1 million
 
  328 Crawford Rd    
Crawford
  Statesville, NC   $2.6 million
 
  480, W. Hanes Mill Road    
480 Office
  Winston-Salem, NC   $3.3 million
 
  143 Mahonoy Ave    
Tamaqua Hometown DC
  Tamaqua, PA   $3.8 million
 
  380 Beaver Creek Road    
Martinsville VSC
  Martinsville, VA   $3.7 million
 
  521 Northridge Park Dr.    
Northridge
  Rural Hall, NC   $14.8 million

First Lien Credit Agreement

 

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ITEM 7.2.2(c) Ongoing Indebtedness

                              HANESBRANDS INC. - CAPITAL LEASE LISTING          
        FY06         Lease #       Interest     Principal     Total  
BALI95
  Xerox     182.68       5,985.32       6,168.00  
BALI138
  Pitney Bowes     175.11       2,176.89       2,352.00  
BALI139
  Pitney Bowes     175.32       2,176.67       2,351.99  
BALI140
  Pitney Bowes                     4,680.00  
BALI147
  Carolina Tractor     2,599.99       4,263.05       6,863.04  
BALI148
  Carolina Tractor     2,625.05       4,305.67       6,930.72  
BALI150
  Carolina Tractor     2,294.59       4,169.45       6,464.04  
BALI151
  Carolina Tractor     125.38       3,894.62       4,020.00  
BALI152
  Konica     4.71       515.29       520.00  
BALI153
  Bassett Office Supply     648.80       4,262.33       4,911.13  
BALI157
  Konica     11.37       1,296.63       1,308.00  
BALI160
  De Lage Landem Financial Services     625.71       3,907.65       4,533.36  
PLAY115
  Citi Capital     1,922.30       9,177.70       11,100.00  
US97
  Citi Capital     478.71       8,993.65       9,472.36  
727
  Pitney Bowes     11.98       180.52       192.50  
729
  Xerox     419.87       6,856.19       7,276.06  
738
  Gill Security Systems     0.00       0.00       3,000.00  
739
  Gill Security Systems     0.00       0.00       2,160.00  
2 trailers
  Salem Leasing     171.50       3,428.50       3,600.00  
OB40
  Outerbanks land and building     30,244.38       183,702.54       213,946.92  
13639 tr
  Salem Leasing     17,235.75       344,564.25       361,800.00  
4400 tr
  Salem Leasing     11,703.39       3,686.61       15,390.00  
4750 tr
  Salem Leasing     2,950.22       1,389.78       4,340.00  
7399 tr
  Salem Leasing     1,939.46       2,380.54       4,320.00  
9904 tr
  Salem Leasing     9,658.89       29,221.11       38,880.00  
11887 tr
  Salem Leasing     886.36       7,753.64       8,640.00  
6
  Simplex Grinnell     174.31       4,853.69       5,028.00  
7
  Telimagine, Inc.     2,552.32       17,355.68       19,908.00  
7420 tr
  Salem Leasing     29,330.28       121,869.72       151,200.00  
15201 tr
  Salem Leasing     202.78       7,097.22       7,300.00  
82638 tr
  Salem Leasing     5,882.15       13,041.85       18,924.00  
13639 tr
  Salem Leasing     14,320.25       286,279.75       300,600.00  
13639 tr
  Salem Leasing     1,886.50       37,713.50       39,600.00  
3121
  Highwoods Realty Ltd Partnership     77,175.96       319,286.05      
396,462.00  

First Lien Credit Agreement

 

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

 

                              HANESBRANDS INC. - CAPITAL LEASE LISTING          
        FY06         Lease #       Interest     Principal     Total  
3129
  Zona Franca De Exportacion el Pedregal     13,442.26       200,973.74      
214,416.00  
13639 tr
  Salem Leasing     16,635.50       332,564.50       349,200.00  
86728 tr
  Salem Leasing     5,749.89       16,762.11       22,512.00  
1
  Xerox     267.00       681.00       948.00  
2
  Xerox     351.79       596.21       948.00  
3
  Xerox     142.82       1,045.18       1,188.00  
4
  Xerox     226.26       3,061.74       3,288.00  
5
  Xerox     2,316.96       29,651.04       31,968.00  
6
  Xerox     93.04       1,682.96       1,776.00  
7
  Xerox     937.40       17,062.60       18,000.00  
8
  Xerox     1,059.04       5,324.96       6,384.00  
9
  Xerox     180.87       2,447.13       2,628.00  
10
  Xerox     2,824.29       38,215.71       41,040.00  
11
  Xerox     215.38       4,123.34       4,338.72  
12
  Xerox     1,498.80       28,693.80       30,192.60  
13
  Xerox     692.60       13,259.32       13,951.92  
14
  Xerox     1,356.00       19,158.00       20,514.00  
15
  Xerox     3,390.00       64,990.00       68,380.00  
16
  Xerox     1,244.16       19,270.08       20,514.24  
17
  Xerox     335.50       6,422.66       6,758.16  
18
  Xerox     4,478.32       6,237.68       10,716.00  
19
  Xerox     3,256.65       8,035.35       11,292.00  
20
  Xerox     580.00       8,576.00       9,156.00  
21
  Xerox     530.00       8,626.00       9,156.00  
22
  Xerox     920.56       8,815.72       9,736.28  
23
  Xerox     1,261.96       24,159.08       25,421.04  
IBM
  IBM     156,321.59       369,278.41       525,600.00  
PHH Leases
  PHH - automobiles from SLC     104,574.00       1,207,923.00      
1,312,497.00  
TOTAL
                        4,446,762.08  

First Lien Credit Agreement

 

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

 

ITEM 7.2.3(c) Ongoing Liens

1.   Lien on the shares of SN Fibers (an Israeli company owned by HBI
International, LLC) pursuant to the SN Fibers Memorandum of Articles.   2.  
Mortages as listed below1

                              Deed of Trust Information     Address   Original
Borrower   Current Owner   (Date, Amount, Book and Page)   Name of Lender
4185 W. 5th Street Lumberton North Carolina

               Robeson
               County
  Robeson County Committee of 100, Inc., a NC non-profit corporation   Sara Lee
Corporation, a
Maryland
corporation
(formerly SL Outer
Banks, LLC)   North Carolina Deed of Trust recorded in Book 623, Page 37 dated
3/26/87 executed by Robeson County Committee of 100, Inc.

Loan Amount — $115,170.00   Douglas B. Mills, Nicky D. Carter, (Successor
Trustee) and John C. Hasty, Trustees of the Cape Fear Construction Company, Inc.
933 Meacham Road
Statesville
North Carolina

               Iredell
               County
  Flexnit Company, Inc., a Delaware Corporation   Bali Company, a
Delaware
corporation

(Dissolved)   Deed of Trust dated 12/27/1974 recorded in Book 447, Page 200
(missing pages 3-7)
and
Deed of Trust and Security Agreement dated 12/26/ 1979 recorded in Book 509,
Page 436 (missing pages 438 and 440-451)

Loan Amount – originally secured $1,7000,000 and then modified to secure up to
$4,000,000   Irving Trust
Company, a New York
Corporation
645 West Pine Street
Mount Airy
North Carolina

                Surry
               County
  The Surry County Industrial Facilities and Pollution Control Financing
Authority   The Surry County Industrial Facilities and Pollution Control
Financing Authority   Deed of Trust dated 4/1/1979 and recorded in Book 348,
Page 606

Loan Amount secured — $4,000,000   Prudential
Reinsurance
Company, a Delaware
corporation
143 Mahanoy Avenue
  Schuylkill County   Greater Tamaqua   Supplemental Mortgage recorded in
Mortgage Book   American Bank

 

1   Please note that for all mortgages listed, there is no outstanding
indebtedness in connection with the mortgage, however a mortgage release has not
been recorded. These releases are a post-closing item.

        First Lien Credit Agreement

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

 

                              Deed of Trust Information     Address   Original
Borrower   Current Owner   (Date, Amount, Book and Page)   Name of Lender
Tamaqua
Pennsylvania

               Schuylkill
               County
  Industrial
Development
Authority   Industrial Development Enterprises (originally leased to J.E. Morgan
Knitting Mills, Inc.)   34-P, Page 782, dated
10/24/1984

Loan Amount secured originally $650,000   and Trust Co. of PA.
480 Hanes Mill Road Winston-Salem, NC 27105 (336) 714-8400

Forsyth County
  National Textiles,
LLC   National Textiles, L.L.C., a Delaware limited liability company   1. Deed
of Trust, Security Agreement, Financing Statement and Assignment of Rents and
Leases from National Textiles, L.L.C., a Delaware limited liability company, to
The Fidelity Company, Trustee for The First National Bank of Chicago, dated as
of December 22, 1997 and recorded December 23, 1997 in Book 1978, Page 3969,
Forsyth County Registry, securing an original amount of 210,000,000.00. (Also
covers additional property)

2. Deed of Trust Modification and Reaffirmation Agreement by and between
National Textiles, L.L.C., a Delaware limited liability company, and Bank One,
NA f/k/a The First National Bank of Chicago, dated as of December 22, 2000 and
recorded January 16, 2001 in Book 2150, Page 2439, Forsyth County Registry,
regarding the Deed of Trust recorded in Book 1978, Page 3969, Forsyth County
Registry.
Loan Amount $210,000,000 but linked to $300,000,000

Loan matures 6/22/2007   Bank One, NA f/k/a The First National Bank of Chicago

        First Lien Credit Agreement

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

 

                              Deed of Trust Information     Address   Original
Borrower   Current Owner   (Date, Amount, Book and Page)   Name of Lender
308 East Thom Street
China Grove, NC 2802

Rowan County
  National Textiles, L.L.C., a Delaware limited liability company   National
Textiles, L.L.C., a Delaware limited liability company   Deed of trust, security
Agreement, Financing Statement and Assignment of Rents and Leases recorded in
Book 879, Page 692, dated 4/28/2000 as modified by that Deed of Trust
Modification and reaffirmation recorded in Book 898, Page 124, dated 12/22/2000

Loan Amount secured– up to $300,000,000   Bank One, NA f/k/a The First National
Bank of Chicago

        First Lien Credit Agreement

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

 

                              Deed of Trust Information     Address   Original
Borrower   Current Owner   (Date, Amount, Book and Page)   Name of Lender
6295 Clementine Dr. #4 Clemmons, NC 27012

               Forsyth
               County
  National Textiles, L.L.C., a Delaware limited liability company   National
Textiles, L.L.C., a Delaware limited liability company   1.      Deed of Trust,
Security Agreement, Financing Statement and Assignment of Rents and Leases from
National Textiles, L.L.C., a Delaware limited liability company, to The Fidelity
Company, Trustee for The First National Bank of Chicago, dated as of
December 22, 1997 and recorded December 23, 1997 in Book 1978, Page 3969,
Forsyth County Registry, securing an original amount of 210,000,000.00. (Also
covers additional property)

2.      Deed of Trust Modification and Reaffirmation Agreement by and between
National Textiles, L.L.C., a Delaware limited liability company, and Bank One,
NA f/k/a The First National Bank of Chicago, dated as of December 22, 2000 and
recorded January 16, 2001 in Book 2150, Page 2439, Forsyth County Registry,
regarding the Deed of Trust recorded in Book 1978, Page 3969, Forsyth County
Registry.

Loan Amount $210,000,000 but linked to $300,000,000

Loan matures 6/22/2007

  Bank One, NA f/k/a The First National Bank of Chicago
136 Gant Road Eden, NC 27288-7935 (336) 635-1354

               Rockingham
               County
  National Textiles, L.L.C., a Delaware limited liability company   National
Textiles, L.L.C., a Delaware limited liability company   Deed of Trust, Security
Agreement, Financing Statement and Assignment of Rents and Leases recorded in
Book 972, Page 2267, dated 12/22/1997

Loan amount secured – up to $300,000,000

  Bank One, NA f/k/a The First National Bank of Chicago
328 Gant Road
Eden, NC 27288-7935
  Eden Yarns, Inc., a Delaware   Sara Lee
Corporation, a   Deed of Trust recorded in Book 804, Page 1004, dated 11/30/1987
as modified by that;   1. Wachovia Bank

        First Lien Credit Agreement

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

 

                              Deed of Trust Information     Address   Original
Borrower   Current Owner   (Date, Amount, Book and Page)   Name of Lender

               Rockingham
               County
  corporation   Maryland
corporation  
First Amendment to Deed of Trust, Assignment of rents and security Agreement
recorded in Book 842, Page 44, dated 12/31/1987 as modified by that;

Amendment to Deed of Trust recorded in Book 836, Page 1533, dated 5/15/1990 as
modified by that;

Third Amendment to deed of Trust recorded in Book 842, Page 66, dated 10/24/1990
as modified by that;

Fourth Amendment to Deed of Trust recorded in Book 871, Page 2321, dated
9/17/1992 as modified by that;

Fifth Amendment to Deed of Trust recorded in Book 906, Page 1959, dated
7/27/1994 as modified by that;

Sixth Amendment to Deed of Trust recorded in Book 941, Page 1268, dated
7/23/1996 as modified by that;

Seventh Amendment to Deed of Trust recorded in Book 989, Page 1624, dated
7/29/1998

Loan amount secured — $66,000,000 ($33,000,000 to Wachovia Bank and $33,000,000
to Suntrust Bank)

matures 11/30/2009   of North Carolina

2. Suntrust Bank
1311 West Main Street
Forest City, NC 28043

               Rutherford
               County
  National Textiles, L.L.C., a Delaware limited liability company   National
Textiles, L.L.C., a Delaware limited liability company   Deed of Trust, Security
Agreement, Financing Statement and Assignment of Rents and Leases recorded in
Book 524, Page 383 as modified by that;

Deed of Trust Modification and Reaffirmation Agreement recorded in Book 768,
Page 334, dated 12/22/2000   Bank One, NA f/k/a The First National Bank of
Chicago

        First Lien Credit Agreement

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

 

                              Deed of Trust Information     Address   Original
Borrower   Current Owner   (Date, Amount, Book and Page)   Name of Lender
 
         
Loan amount secured $210,000,000.00, but linked to $300,000,000 in future
advance section.

   
1012 Glendale Drive
Galax, VA 24333

               Carroll County
  National Textiles, L.L.C., a Delaware limited liability company   National
Textiles, L.L.C., a Delaware limited liability company   Deed of Trust Security
Agreement, Financing Statement and Assignment of Rents and Leases, dated
December 22, 1997, recorded on December 23, 1997 in Book 523, Page 283, Clerk’s
Office of Carroll County, Virginia;

This is a credit line deed of trust in the amount of $2,250,000.00, but linked
to secure the $210,000,000 in the recitals   Bank One, NA f/k/a The First
National Bank of Chicago
501 Brown Street (P.O. Box 12500) Gastonia, NC 28053

                Gaston County
  National Textiles, L.L.C., a Delaware limited liability company   National
Textiles, L.L.C., a Delaware limited liability company   Deed of Trust Security
Agreement, Financing Statement and Assignment of Rents and Leases, recorded in
Book 3091, Page 284, dated 5/30/2000

Loan Amount $210,000,000 but linked to $300,000,000

  Bank One, NA f/k/a The First National Bank of Chicago
1925 West Poplar Street
Gastonia, NC 28052

                Gaston County
  National Textiles, L.L.C., a Delaware limited liability company   National
Textiles, L.L.C., a Delaware limited liability company   Deed of Trust, Security
Agreement, Financing Statement, and Assignment of Rents and Leases recorded in
Book 3079, Page 737, dated 4/28/2000

Loan Amount $210,000,000 but linked to $300,000,000   Bank One, NA f/k/a The
First National Bank of Chicago
100 Reep Drive
Morganton, NC 28655

                Burke
               County
  National Textiles, L.L.C., a Delaware limited liability company   National
Textiles, L.L.C., a Delaware limited liability company   Deed of Trust, Security
Agreement, Financing Statement, and Assignment of Rents and Leases recorded in
Book 892, Page 1011, dated 12/22/1997 as modified by
that;

Deed of Trust Modification and Reaffirmation Agreement Book 979, Page 557, dated
12/22/2000

Matures 6/22/2007   Bank One, NA f/k/a The First National Bank of Chicago

        First Lien Credit Agreement

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                              Deed of Trust Information     Address   Original
Borrower   Current Owner   (Date, Amount, Book and Page)   Name of Lender
 
          Loan Amount — $210,000,000.00 but secures up to $300,000,000 in future
advances section    
3916 Highway 421 South Mountain City, TN 37683 (423) 727-5270

               Johnson Co
  National Textiles,
LLC   The Industrial Development Board of the County of Johnson County,
Tennessee, a Tennessee public, not-for-profit corporation   Leasehold Deed of
Trust, Security Agreement, Financing Statement and Assignment of Rents and
Leases dated 12/22/1997
TD Book 135, Page 578 as modified byLeasehold Deed of trust Modification and
Reaffirmation Agreement dated 12/22/2000
TD Book 157, Page 288

First National Bank of Chicago

Loan Amount — $15,418,929.00 but linked to $300,000,000 in the recitals   Bank
One, NA f/k/a The First National Bank of Chicago
815 John Beck Dockins
Road

               Rabun County
  National Textiles,
LLC   Development Authority of Rabun County, Georgia, a public body corporate
and politic of the State of Georgia   Deed to Secure debt, Security Agreement,
and Assignment of Rents and Leases from National Textiles, LLC (as grantor) and
Development Authority of Rabun County, Georgia (solely for purpose of
consenting), recorded in Book O-17/1, dated 12/22/1997, as modified by that Deed
to Secure Debt Modification and Reaffirmation Agreement Agreement recorded in
Book K-20/306, dated 12/22/2000

Loan Amount - $8,500,000.00

matures 6/22/2007   Bank One, NA f/k/a The First National Bank of Chicago
2652 Dalrymple Street Sanford, NC 27330

               Lee Co.
  National Textiles, L.L.C., a Delaware limited liability company   National
Textiles, L.L.C., a Delaware limited liability company   Deed of Trust, Security
Agreement, Financing Statement, and Assignment of Rents and Leases recorded in
Book 625, Page 330, dated 12/22/1997

Loan Amount — $210,000,000.00 but secures up to $300,000,000 in future advances
section   Bank One, NA f/k/a The First National Bank of Chicago

3.   Equipment Leases as listed below

        First Lien Credit Agreement

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

 

                                              Debtor   Jurisdiction   Filing
Type   Through Date   Secured Party   File Number and Date   Collateral
Description
National Textiles, L.L.C. 480 E. Hanes Mill Road Winston-Salem, NC 27105
  Secretary of State, Delaware   UCC   8/4/2006   LaSalle National Leasing
Corporation
One West Pennsylvania Avenue
Towson, MD 21204   2031537-8
1/14/2002   Leased equipment pursuant to Master Lease Agreement dated 6/13/2001.
National Textiles, L.L.C. 480 E. Hanes Mill Road Winston-Salem, NC 27105
Additional Debtors: National Textiles Services I, L.L.C. 480 E. Hanes Mill Road
Winston-Salem, NC 27105

National Textiles Services II, L.L.C. 480 E. Hanes Mill Road Winston-Salem, NC
27105

National Textiles Services III, L.L.C. 480 E. Hanes Mill Road Winston-Salem, NC
27105
  Secretary of State, Delaware   UCC   8/4/2006   LaSalle National Leasing
Corporation
One West Pennsylvania Avenue
Towson, MD 21204   3055776-2
3/7/2003   Leased manufacturing equipment.

        First Lien Credit Agreement

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

 

ITEM 7.2.5(a) Ongoing Investments

1.   Subsidiaries as listed in ITEM 6.8 above along with the below listed
companies.

(a) SN Fibers (49% interest)
(b) Playtex Marketing Corporation (50% interest)*
* This company is an investment subject to the completion of the post closing
obligations set forth in Section 7.1.11 of the Credit Agreement.

2.   Deposit and Securities accounts

                  Name of Grantor   Bank Name   Account Title   Type of Account
  Bank Account Number
Hanesbrands Parent
  Bank of America   Hanesbrands PR Checks   Business Checking   [*****]
Hanesbrands Parent
  Bank of America   Hanesbrands Direct Deposit   Business Checking   [*****]
Hanesbrands Parent
  Bank of America   HanesbrandsTravel Adv. E-cash   Business Checking   [*****]
Hanesbrands Parent
  Bank of America   Hanesbrands PR E-cash   Business Checking   [*****]
Hanesbrands Parent
  Bank of America   Hanesbrands PR funding   Concentration   [*****]
Hanesbrands Parent
  Chase   Hanesbrands AP Checks   Business Checking   [*****]
Hanesbrands Parent
  Chase   Hanesbrands Tax Clearing   Clearing   [*****]
Hanesbrands Parent
  Chase   Hanesbrands Note   Concentration   [*****]
Hanesbrands Parent
  Chase   Hanesbrands AP ACH   Clearing   [*****]
Hanesbrands Parent
  Chase   Hanesbrands Master   Concentration   [*****]
Hanesbrands Parent
  Chase   Hanesbrands Casualwear Note   Concentration   [*****]
Hanesbrands Parent
  Chase   Hanesbrands Direct Note   Concentration   [*****]
Hanesbrands Parent
  Chase   Eden Yarns Inc. Note   Concentration   [*****]
Hanesbrands Parent
  Chase   Leggs Products Note   Concentration   [*****]
Hanesbrands Parent
  Chase   Hanesbrands Playtex Apparel Note   Concentration   [*****]

 

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

 

                  Name of Grantor   Bank Name   Account Title   Type of Account
  Bank Account Number
Hanesbrands Parent
  Chase   Hanesbrands Outer Banks LLC Note   Concentration   [*****]
Hanesbrands Parent
  Chase   Hanesbrands Note   Concentration   [*****]
Hanesbrands Parent
  Chase   Hanesbrands Sock Company Note   Concentration   [*****]
Hanesbrands Parent
  Chase   Hanesbrands Printables Note   Concentration   [*****]
Hanesbrands Parent
  Chase   Jogbra Inc Notes   Concentration   [*****]
Hanesbrands Parent
  Chase   Champion Products Inc Note   Concentration   [*****]
Hanesbrands Parent
  Chase   JE Morgan (Harwood Companies) Note   Concentration   [*****]
Hanesbrands Parent
  Chase   Host Apparel Note Account Harwood Industries   Concentration   [*****]
Hanesbrands Parent
  Chase   Hanesbrands Knit Products Note   Concentration   [*****]
Hanesbrands Parent
  Chase   The Harwood Companies Note Account   Concentration   [*****]
Hanesbrands Parent
  Chase   Hanesbrands Pacific Rim Note C/O
Hanesbrands Export   Concentration   [*****]
Hanesbrands Parent
  Chase   HBI LEASING WYOMING INC   Other   [*****]
Hanesbrands Parent
  Chase   CAYWEAR   Other   [*****]
Hanesbrands Parent
  Chase   ROOT CONSULTING INC UPEL   Other   [*****]
Hanesbrands Parent
  Chase   HANESBRANDS HOSIERY CUSTOMER EFT RECEIPTS   Other   [*****]
Hanesbrands Parent
  Chase   HANESBRANDS HOSIERY REFUNDS GUARANTEE
DISBURSEMENTS   Business Checking   [*****]
Hanesbrands Parent
  Chase   HANESBRANDS HOSIERY CONCENTRATION   Concentration   [*****]
Hanesbrands Parent
  Chase   HANESBRANDS HOSIERY CONCENTRATION   Concentration   [*****]
Hanesbrands Parent
  Chase   PLAYTEX DORADO HANESBRANDS INC   Other   [*****]

 

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

 

                  Name of Grantor   Bank Name   Account Title   Type of Account
  Bank Account Number
Hanesbrands Parent
  Chase   BALI FDN INC   Business Checking   [*****]
Hanesbrands Parent
  Chase   PLAYTEX CONCENTRATION(HANESBRANDS INTIMATES
& HOSIERY CON ACCT P)   Concentration   [*****]
Hanesbrands Parent
  Chase   HANESBRANDS INTIMATES & HOSIERY CO-OP
ADVERTISING   Other   [*****]
Hanesbrands Parent
  Chase   HANESBRANDS PRINTABLES CONCENTRATION   Concentration   [*****]
Hanesbrands Parent
  Chase   HANESBRANDS SPORTSWEAR   Other   [*****]
Hanesbrands Parent
  Chase   CHAMPION CUSTOMS   Other   [*****]
Hanesbrands Parent
  Chase   HANESBRANDS KNIT PRODUCTS HANES MENSWEAR
ACCT   Other   [*****]
Hanesbrands Parent
  Chase   HANESBRANDS UNDERWEAR GENERAL ACCOUNT   General   [*****]
Hanesbrands Parent
  Chase   HANESBRANDS UNDERWEAR CUSTOMS ACH   Other   [*****]
Hanesbrands Parent
  Chase   HARWOOD COMPANIES, INC   Other   [*****]
Hanesbrands Parent
  Chase   HANESBRANDS UNDERWEAR/CASUALWEAR LOCKBOX   Other   [*****]
Hanesbrands Parent
  Wachovia   HANEBRANDS SOCK   Lock Box   [*****]
Hanesbrands Parent
  Wachovia   JE Morgan   Depository   [*****]
Hanesbrands Parent
  Wachovia   JE Morgan   Depository   [*****]
Hanesbrands Parent
  Wachovia   Export   Depository   [*****]
Hanesbrands Parent
  Wachovia   Outer Banks   Lock Box   [*****]

 

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

 

                  Name of Grantor   Bank Name   Account Title   Type of Account
  Bank Account Number
BA International LLC
  NONE            

 

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

 

                  Name of Grantor   Bank Name   Account Title   Type of Account
  Bank Account Number
Caribesock, Inc.
  Chase   Caribesock, Inc.   Other   [*****]

 

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

 

                  Name of Grantor   Bank Name   Account Title   Type of Account
  Bank Account Number
Caribetex, Inc.
  Chase   Caribetex   Other   [*****]

 

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

 

                  Name of Grantor   Bank Name   Account Title   Type of Account
  Bank Account Number
CASA International, LLC
  NONE            

 

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

 

                  Name of Grantor   Bank Name   Account Title   Type of Account
  Bank Account Number
Ceibena Del Inc.
  Chase   CEIBENA DEL INC   Other   [*****]
Ceibena Del Inc.
  Chase   MANUFACTURERS CEIBENA   General   [*****]
Ceibena Del Inc.
  Banco Mercantil   Manufacturera Ceibena   Operating   [*****]
Ceibena Del Inc.
  Banco Mercantil   Manufacturera Ceibena   Operating   [*****]

 

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

 

                  Name of Grantor   Bank Name   Account Title   Type of Account
  Bank Account Number
Hanes Menswear, LLC
  Banco Popular   Hanes Menswear   Concentration   [*****]
Hanes Menswear, LLC
  Banco Popular   Hanes Menswear   Business Checking   [*****]
Hanes Menswear, LLC
  Banco Popular   Hanes Menswear   Business Checking   [*****]
Hanes Menswear, LLC
  Banco Popular   Hanes Menswear   Business Checking   [*****]
Hanes Menswear, LLC
  Banco Popular   Hanes Menswear   General   [*****]
Hanes Menswear, LLC
  Chase   Hanes Menswear   General   [*****]

 

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

 

                  Name of Grantor   Bank Name   Account Title   Type of Account
  Bank Account Number
Hanes Puerto Rico, Inc.
  NONE            

 

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

 

                  Name of Grantor   Bank Name   Account Title   Type of Account
  Bank Account Number
Hanesbrands Direct, LLC
  Chase   Direct Note   Concentration   [*****]
Hanesbrands Direct, LLC
  JPMorgan Chase   Direct Costumer Refund   Disbursement — non payroll   [*****]
Hanesbrands Direct, LLC
  JPMorgan Chase   Direct Costumer Refund   Disbursement — non payroll   [*****]
Hanesbrands Direct, LLC
  JPMorgan Chase   Direct Store Deposits   Depository/Collection   [*****]
Hanesbrands Direct, LLC
  Wachovia   Direct Store Deposits   Depository/Collection   [*****]
Hanesbrands Direct, LLC
  Wachovia   Direct Store Deposits   Depository/Collection   [*****]
Hanesbrands Direct, LLC
  First Security Bank   Direct Store Deposits   Depository/Collection   [*****]
Hanesbrands Direct, LLC
  Alliance Bank   Direct Store Deposits   Depository/Collection   [*****]
Hanesbrands Direct, LLC
  American National Bank of TX   Direct Store Deposits   Depository/Collection  
[*****]
Hanesbrands Direct, LLC
  Americana Community
Bank   Direct Store Deposits   Depository/Collection   [*****]
Hanesbrands Direct, LLC
  Amsouth Bank   Direct Store Deposits   Depository/Collection   [*****]
Hanesbrands Direct, LLC
  BancorpSouth   Direct Store Deposits   Depository/Collection   [*****]
Hanesbrands Direct, LLC
  BancorpSouth   Direct Store Deposits   Depository/Collection   [*****]
Hanesbrands Direct, LLC
  Bank of America   Direct Store Deposits   Depository/Collection   [*****]
Hanesbrands Direct, LLC
  Bank of America   Direct Store Deposits   Depository/Collection   [*****]
Hanesbrands Direct, LLC
  Bank of America   Direct Store Deposits   Depository/Collection   [*****]
Hanesbrands Direct, LLC
  Bank of America   Direct Store Deposits   Depository/Collection   [*****]
Hanesbrands Direct, LLC
  Bank of Clarendon   Direct Store Deposits   Depository/Collection   [*****]

 

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

 

                  Name of Grantor   Bank Name   Account Title   Type of Account
  Bank Account Number
Hanesbrands Direct, LLC
  Bank of New York   Direct Store Deposits   Depository/Collection   [*****]
Hanesbrands Direct, LLC
  Bank of Ocean City   Direct Store Deposits   Depository/Collection   [*****]
Hanesbrands Direct, LLC
  Bank of Odessa   Direct Store Deposits   Depository/Collection   [*****]
Hanesbrands Direct, LLC
  Bank of Petaluma   Direct Store Deposits   Depository/Collection   [*****]
Hanesbrands Direct, LLC
  Bank of the Cascades   Direct Store Deposits   Depository/Collection   [*****]
Hanesbrands Direct, LLC
  Bank of the West   Direct Store Deposits   Depository/Collection   [*****]
Hanesbrands Direct, LLC
  BB&T   Direct Store Deposits   Depository/Collection   [*****]
Hanesbrands Direct, LLC
  Borrego Springs Bank   Direct Store Deposits   Depository/Collection   [*****]
Hanesbrands Direct, LLC
  Centura Bank   Direct Store Deposits   Depository/Collection   [*****]
Hanesbrands Direct, LLC
  Centura Bank   Direct Store Deposits   Depository/Collection   [*****]
Hanesbrands Direct, LLC
  Chittenden Bank   Direct Store Deposits   Depository/Collection   [*****]
Hanesbrands Direct, LLC
  Citizens Bank   Direct Store Deposits   Depository/Collection   [*****]
Hanesbrands Direct, LLC
  Citizens Bank   Direct Store Deposits   Depository/Collection   [*****]
Hanesbrands Direct, LLC
  Citizens National
Bank   Direct Store Deposits   Depository/Collection   [*****]
Hanesbrands Direct, LLC
  City National Bank   Direct Store Deposits   Depository/Collection   [*****]
Hanesbrands Direct, LLC
  City National Bank   Direct Store Deposits   Depository/Collection   [*****]
Hanesbrands Direct, LLC
  Columbia State Bank   Direct Store Deposits   Depository/Collection   [*****]

 

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

 

                  Name of Grantor   Bank Name   Account Title   Type of Account
  Bank Account Number
Hanesbrands Direct, LLC
  Commerce Bank   Direct Store Deposits   Depository/Collection   [*****]
Hanesbrands Direct, LLC
  Community Bank   Direct Store Deposits   Depository/Collection   [*****]
Hanesbrands Direct, LLC
  Community Bank of Homestead   Direct Store Deposits   Depository/Collection  
[*****]
Hanesbrands Direct, LLC
  Community National
Bank   Direct Store Deposits   Depository/Collection   [*****]
Hanesbrands Direct, LLC
  Compass Bank   Direct Store Deposits   Depository/Collection   [*****]
Hanesbrands Direct, LLC
  Covenant Bank   Direct Store Deposits   Depository/Collection   [*****]
Hanesbrands Direct, LLC
  Dalton Whitfield
Bank   Direct Store Deposits   Depository/Collection   [*****]
Hanesbrands Direct, LLC
  F&M Bank   Direct Store Deposits   Depository/Collection   [*****]
Hanesbrands Direct, LLC
  Farmers Bank & Trust   Direct Store Deposits   Depository/Collection   [*****]
Hanesbrands Direct, LLC
  Farmers Trust &
Savings   Direct Store Deposits   Depository/Collection   [*****]
Hanesbrands Direct, LLC
  Farmers Trust &
Savings   Direct Store Deposits   Depository/Collection   [*****]
Hanesbrands Direct, LLC
  First American Bank   Direct Store Deposits   Depository/Collection   [*****]
Hanesbrands Direct, LLC
  First Bank   Direct Store Deposits   Depository/Collection   [*****]
Hanesbrands Direct, LLC
  First Bank   Direct Store Deposits   Depository/Collection   [*****]
Hanesbrands Direct, LLC
  First Bank   Direct Store Deposits   Depository/Collection   [*****]
Hanesbrands Direct, LLC
  First Bank of Douglas City   Direct Store Deposits   Depository/Collection  
[*****]
Hanesbrands Direct, LLC
  First Bank of the Lake   Direct Store Deposits   Depository/Collection  
[*****]

 

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

 

                  Name of Grantor   Bank Name   Account Title   Type of Account
  Bank Account Number
Hanesbrands Direct, LLC
  First Banking Center   Direct Store Deposits   Depository/Collection   [*****]
Hanesbrands Direct, LLC
  First Century   Direct Store Deposits   Depository/Collection   [*****]
Hanesbrands Direct, LLC
  First Citizens   Direct Store Deposits   Depository/Collection   [*****]
Hanesbrands Direct, LLC
  First National Bank of (unspec)   Direct Store Deposits  
Depository/Collection   [***** ]
Hanesbrands Direct, LLC
  First National Bank of (unspec)   Direct Store Deposits  
Depository/Collection   [*****]
Hanesbrands Direct, LLC
  First National Bank of Gwinnett   Direct Store Deposits  
Depository/Collection   [*****]
Hanesbrands Direct, LLC
  First National Bank of NE   Direct Store Deposits   Depository/Collection  
[*****]
Hanesbrands Direct, LLC
  First National Bank of Olathe   Direct Store Deposits   Depository/Collection
  [*****]
Hanesbrands Direct, LLC
  First National Bank of TX   Direct Store Deposits   Depository/Collection  
[*****]
Hanesbrands Direct, LLC
  First State Bank of Gainesville   Direct Store Deposits  
Depository/Collection   [*****]
Hanesbrands Direct, LLC
  Frost National Bank   Direct Store Deposits   Depository/Collection   [*****]
Hanesbrands Direct, LLC
  Gibsland Bank and Trust   Direct Store Deposits   Depository/Collection  
[*****]
Hanesbrands Direct, LLC
  Glens Falls
National Bank   Direct Store Deposits   Depository/Collection   [*****]
Hanesbrands Direct, LLC
  Harris Bank   Direct Store Deposits   Depository/Collection   [*****]
Hanesbrands Direct, LLC
  HSBC Bank USA   Direct Store Deposits   Depository/Collection   [*****]

 

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

 

                  Name of Grantor   Bank Name   Account Title   Type of Account
  Bank Account Number
Hanesbrands Direct, LLC
  Huntington National
Bank   Direct Store Deposits   Depository/Collection   [*****]
Hanesbrands Direct, LLC
  Irwin Union Bank   Direct Store Deposits   Depository/Collection   [*****]
Hanesbrands Direct, LLC
  JPMorgan Chase   Direct Store Deposits   Depository/Collection   [*****]
Hanesbrands Direct, LLC
  JPMorgan Chase   Direct Store Deposits   Depository/Collection   [*****]
Hanesbrands Direct, LLC
  JPMorgan Chase   Direct Store Deposits   Depository/Collection   [*****]
Hanesbrands Direct, LLC
  Legacy Bank   Direct Store Deposits   Depository/Collection   [*****]
Hanesbrands Direct, LLC
  Legacy Bank   Direct Store Deposits   Depository/Collection   [*****]
Hanesbrands Direct, LLC
  M&T Bank   Direct Store Deposits   Depository/Collection   [*****]
Hanesbrands Direct, LLC
  McIntosh State Bank   Direct Store Deposits   Depository/Collection   [*****]
Hanesbrands Direct, LLC
  Mid State Bank and Trust   Direct Store Deposits   Depository/Collection  
[*****]
Hanesbrands Direct, LLC
  Montgomery Bank   Direct Store Deposits   Depository/Collection   [*****]
Hanesbrands Direct, LLC
  Five Star Bank   Direct Store Deposits   Depository/Collection   [*****]
Hanesbrands Direct, LLC
  National City Bank
(unspec)   Direct Store Deposits   Depository/Collection   [*****]
Hanesbrands Direct, LLC
  National City Bank
(unspec)   Direct Store Deposits   Depository/Collection   [*****]
Hanesbrands Direct, LLC
  National City Bank
(unspec)   Direct Store Deposits   Depository/Collection   [*****]
Hanesbrands Direct, LLC
  National City Bank
(unspec)   Direct Store Deposits   Depository/Collection   [*****]

 

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

 

                  Name of Grantor   Bank Name   Account Title   Type of Account
  Bank Account Number
Hanesbrands Direct, LLC
  National City Bank
(unspec)   Direct Store Deposits   Depository/Collection   [*****]
Hanesbrands Direct, LLC
  National Penn   Direct Store Deposits   Depository/Collection   [*****]
Hanesbrands Direct, LLC
  Old Second National
Bank   Direct Store Deposits   Depository/Collection   [*****]
Hanesbrands Direct, LLC
  Ozark Mountain Bank   Direct Store Deposits   Depository/Collection   [*****]
Hanesbrands Direct, LLC
  Ozark Mountain Bank   Direct Store Deposits   Depository/Collection   [*****]
Hanesbrands Direct, LLC
  Park Avenue Bank
(GA, FL)   Direct Store Deposits   Depository/Collection   [*****]
Hanesbrands Direct, LLC
  Pinnacle Bank   Direct Store Deposits   Depository/Collection   [*****]
Hanesbrands Direct, LLC
  PNC Bank   Direct Store Deposits   Depository/Collection   [*****]
Hanesbrands Direct, LLC
  PNC Bank   Direct Store Deposits   Depository/Collection   [*****]
Hanesbrands Direct, LLC
  Premier Bank
(Missouri)   Direct Store Deposits   Depository/Collection   [*****]
Hanesbrands Direct, LLC
  Premier Banks
(Minnesota)   Direct Store Deposits   Depository/Collection   [*****]
Hanesbrands Direct, LLC
  Queenstown Bank   Direct Store Deposits   Depository/Collection   [*****]
Hanesbrands Direct, LLC
  Regions Bank   Direct Store Deposits   Depository/Collection   [*****]
Hanesbrands Direct, LLC
  Regions Bank   Direct Store Deposits   Depository/Collection   [*****]
Hanesbrands Direct, LLC
  Security National
Bank   Direct Store Deposits   Depository/Collection   [*****]
Hanesbrands Direct, LLC
  Security State Bank   Direct Store Deposits   Depository/Collection   [*****]

 

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

 

                  Name of Grantor   Bank Name   Account Title   Type of Account
  Bank Account Number
Hanesbrands Direct, LLC
  Skagit State Bank   Direct Store Deposits   Depository/Collection   [*****]
Hanesbrands Direct, LLC
  Skagit State Bank   Direct Store Deposits   Depository/Collection   [*****]
Hanesbrands Direct, LLC
  Sky Bank   Direct Store Deposits   Depository/Collection   [*****]
Hanesbrands Direct, LLC
  Somerset Trust Co   Direct Store Deposits   Depository/Collection   [*****]
Hanesbrands Direct, LLC
  South Carolina Bank and Trust   Direct Store Deposits   Depository/Collection
  [*****]
Hanesbrands Direct, LLC
  Southeastern Bank   Direct Store Deposits   Depository/Collection   [*****]
Hanesbrands Direct, LLC
  Southeastern Bank   Direct Store Deposits   Depository/Collection   [*****]
Hanesbrands Direct, LLC
  SunTrust   Direct Store Deposits   Depository/Collection   [*****]
Hanesbrands Direct, LLC
  SunTrust   Direct Store Deposits   Depository/Collection   [*****]
Hanesbrands Direct, LLC
  SunTrust   Direct Store Deposits   Depository/Collection   [*****]
Hanesbrands Direct, LLC
  SunTrust   Direct Store Deposits   Depository/Collection   [*****]
Hanesbrands Direct, LLC
  Susquehanna Bank   Direct Store Deposits   Depository/Collection   [*****]
Hanesbrands Direct, LLC
  TD North   Direct Store Deposits   Depository/Collection   [*****]
Hanesbrands Direct, LLC
  TD North   Direct Store Deposits   Depository/Collection   [*****]
Hanesbrands Direct, LLC
  TD North   Direct Store Deposits   Depository/Collection   [*****]
Hanesbrands Direct, LLC
  TD North   Direct Store Deposits   Depository/Collection   [*****]
Hanesbrands Direct, LLC
  TD North   Direct Store Deposits   Depository/Collection   [*****]
Hanesbrands Direct, LLC
  Trustmark National
Bank   Direct Store Deposits   Depository/Collection   [*****]
Hanesbrands Direct, LLC
  Tuscola National   Direct Store Deposits   Depository/Collection   [*****]

 

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

 

                  Name of Grantor   Bank Name   Account Title   Type of Account
  Bank Account Number
Hanesbrands Direct, LLC
  US Bank   Direct Store Deposits   Depository/Collection   [*****]
Hanesbrands Direct, LLC
  US Bank   Direct Store Deposits   Depository/Collection   [*****]
Hanesbrands Direct, LLC
  US Bank   Direct Store Deposits   Depository/Collection   [*****]
Hanesbrands Direct, LLC
  Wachovia   Direct Store Deposits   Depository/Collection   [*****]
Hanesbrands Direct, LLC
  Wachovia   Direct Store Deposits   Depository/Collection   [*****]
Hanesbrands Direct, LLC
  Wachovia   Direct Store Deposits   Depository/Collection   [*****]
Hanesbrands Direct, LLC
  Washington Mutual   Direct Store Deposits   Depository/Collection   [*****]
Hanesbrands Direct, LLC
  Washington Trust   Direct Store Deposits   Depository/Collection   [*****]
Hanesbrands Direct, LLC
  Wells Fargo   Direct Store Deposits   Depository/Collection   [*****]
Hanesbrands Direct, LLC
  Wilmington Trust   Direct Store Deposits   Depository/Collection   [*****]
Hanesbrands Direct, LLC
  Wilson Bank & Trust   Direct Store Deposits   Depository/Collection   [*****]
Hanesbrands Direct, LLC
  Wrentham
Cooperative Bank   Direct Store Deposits   Depository/Collection   [*****]

 

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

 

                  Name of Grantor   Bank Name   Account Title   Type of Account
  Bank Account Number
HBI Branded Apparel
Enterprises. LLC
  None            

 

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

 

                  Name of Grantor   Bank Name   Account Title   Type of Account
  Bank Account Number
Hanesbrands Distribution, Inc.
  Chase   Hanesbrands Distribution   Other   [*****]

 

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

 

                  Name of Grantor   Bank Name   Account Title   Type of Account
  Bank Account Number
HBI Branded Apparel Limited Inc
  NONE            

 

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

 

                  Name of Grantor   Bank Name   Account Title   Type of Account
  Bank Account Number HBI International, LLC   Chase   HBI International LLC  
Other   [*****]

 

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

 

                  Name of Grantor   Bank Name   Account Title   Type of Account
  Bank Account Number HBI Sourcing, LLC   Chase   HBI Sourcing LLC   Other  
[*****]

 

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

 

                  Name of Grantor   Bank Name   Account Title   Type of Account
  Bank Account Number Inner Self, LLC   Chase   Inner Self, LLC   General  
[*****]

 

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

 

                  Name of Grantor   Bank Name   Account Title   Type of Account
  Bank Account Number
Jasper-Costa Rica, L.L.C.
  NONE            

 

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

 

                  Name of Grantor   Bank Name   Account Title   Type of Account
  Bank Account Number
National Textiles, LLC
  Chase   NATIONAL TEXTILES NOTE   Concentration   [*****]
National Textiles, LLC
  Chase   NATIONAL TEXTILES A/P   Business Checking   [*****]
National Textiles, LLC
  Chase   NATIONAL TEXTILES HOURLY PAYROLL   Business Checking   [*****]
National Textiles, LLC
  Chase   NATIONAL TEXTILES SALARY PAYROLL   Business Checking   [*****]
National Textiles, LLC
  Chase   NATIONAL TEXTILES MEDICAL/DENTAL   Business Checking   [*****]
National Textiles, LLC
  Chase   EDEN YARNS NOTE   Concentration   [*****]

 

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

 

                  Name of Grantor   Bank Name   Account Title   Type of Account
  Bank Account Number
NT Investment Company
  NONE            

 

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

 

                  Name of Grantor   Bank Name   Account Title   Type of Account
  Bank Account Number
Playtex Dorado, LLC
  BANCO POPULAR   PLAYTEX DORADO CORPORATION   Business Checking   [*****]
Playtex Dorado, LLC
  BANCO POPULAR   PLAYTEX DORADO CORPORATION   Business Checking   [*****]
Playtex Dorado, LLC
  Chase   PLAYTEX DORADO CORPORATION   Depository   [*****]

 

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

 

                  Name of Grantor   Bank Name   Account Title   Type of Account
  Bank Account Number
Playtex Industries Inc
  NONE            

 

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

 

                  Name of Grantor   Bank Name   Account Title   Type of Account
  Bank Account Number
Seamless Textiles LLC
  Banco Popular   SEAMLESS TEXTILES, INC.   Business Checking   [*****]
Seamless Textiles LLC
  Banco Popular   SEAMLESS TEXTILES, INC.   Business Checking   [*****]
Seamless Textiles LLC
  Chase   SEAMLESS TEXTILES, INC.   Depository   [*****]
Seamless Textiles LLC
  Banco Popular   Seamless MMIA Short Term   Cert of Deposit   [*****]

 

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

 

                  Name of Grantor   Bank Name   Account Title   Type of Account
  Bank Account Number
UPCR Inc
  CHASE   UPCR INC   General   [*****]

 

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

 

                  Name of Grantor   Bank Name   Account Title   Type of Account
  Bank Account Number
UPEL Inc
  CHASE   UPEL Inc   Other   [*****]

 

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

 

                 
BA International, L.L.C.
               
Caribesock, Inc.
               
Caribetex, Inc.
               
CASA International, LLC
               
Ceibena Del, Inc.
               
Hanes Menswear, LLC
               
Hanes Puerto Rico, Inc.
               
Hanesbrands Direct, LLC
               
Hanesbrands Distribution, Inc.
               
HBI Branded Apparel
Enterprises, LLC
               
HBI Branded Apparel Limited, Inc.
               
HbI International, LLC
               
HBI Sourcing, LLC
               
Inner Self LLC
               
National Textiles, L.L.C.
               
NT Investment Company, Inc.
               
Playtex Dorado, LLC
               
Playtex Industries, Inc.
               
Seamless Textiles, LLC
               
UPCR, Inc.
               
UPEL, Inc.
               

 

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

 

ITEM 7.2.11(m) Permitted Dispositions

      Location of property   Description
[*****]
  Approximately 4.93 acres [*****]
[*****]
  Approximately 54,524 square foot building located on approximately 5.47 acres
[*****]
  Property currently leased to third party
[*****]
  [*****]
[*****]
  Approximately 267 acres [*****]
[*****]
  Approximately 173,805 square foot building
[*****]
  Approximately 28,000 square foot building
[*****]
  Several buildings aggregating approximately 47,802 square feet
[*****]
  Approximately 43,859 square foot building
[*****]
  Approximately 56,505 square foot building
[*****]
  Approximately 148,477 square foot building
[*****]
  Approximately 48,653 square foot building
[*****]
  Approximately 24,326 square foot building
[*****]
  Approximately 97,546 square foot building
[*****]
  Approximately 22,539 square foot building located on approximately 112,816
square feet of land
[*****]
  Approximately 603,338 square foot building located on approximately 13.9 acres

 

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

 

SCHEDULE II
PERCENTAGES;
LIBOR OFFICE;
DOMESTIC OFFICE

                                  NAME AND                     NOTICE          
          ADDRESS OF           REVOLVING LOAN   TERM A   TERM B LENDER   LIBOR
OFFICE   DOMESTIC OFFICE   COMMITMENT   COMMITMENT   COMMITMENT
Merrill Lynch
Capital
Corporation
  Merrill Lynch Capital
Corporation
4 World Financial Center
22nd Floor
New York, NY 10080
Attn: Nancy Meadows
Tel: (212) 449-2879
Fax: (212) 738-1186
Email:
Nancy_Meadows@ml.com   Merrill Lynch Capital Corporation
4 World Financial Center
22nd Floor
New York, NY 10080
Attn: Nancy Meadows
Tel: (212) 449-2879
Fax: (212) 738-1186
Email: Nancy_Meadows@ml.com     11.6548 %     4.8096 %     50.0000 %
 
                               
Morgan Stanley
Senior Funding,
Inc.
  Morgan Stanley Senior
Funding, Inc.
1585 Broadway
New York, NY 10036   Morgan Stanley Senior Funding,
Inc.
1585 Broadway
New York, NY 10036     11.6548 %     4.8096 %     50.0000 %
 
                               
LaSalle Bank
National
Association
Barclays Bank
PLC
  To be provided.   To be provided.     8.9726

8.9726 %

%     8.7452

8.7452 %

%     0.0000

0.0000 %

%

 

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

 

                                  NAME AND                     NOTICE          
          ADDRESS OF           REVOLVING LOAN   TERM A   TERM B LENDER   LIBOR
OFFICE   DOMESTIC OFFICE   COMMITMENT   COMMITMENT   COMMITMENT
HSBC Bank
UCA, National
Association
  To be provided.   To be provided.     8.9726 %     8.7452 %     0.0000 %
 
                               
Citicorp USA,
Inc.

  To be provided.   To be provided.     8.9726 %     8.7452 %     0.0000 %
 
                               
The Northern
Trust Company
  To be provided.   To be provided.     1.8000 %     2.4000 %     0.0000 %
 
                               
Branch Banking
& Trust
Company
  Branch Banking & Trust
Company
110 South Stratford Road
Winston Salem, NC 27104
Attn: Michael P. Gwyn
Tel: (336) 733-1119
Fax: (336) 733-1134
Email: mgwyn@bbandt.com   Branch Banking & Trust Company
110 South Stratford Road
Winston Salem, NC 27104
Attn: Michael P. Gwyn
Tel: (336) 733-1119
Fax: (336) 733-1134
Email: mgwyn@bbandt.com     6.0000 %     8.0000 %     0.0000 %
 
                               
National City
Bank

  To be provided.   To be provided.     1.5000 %     2.0000 %     0.0000 %
 
                               
The Royal Bank
of Scotland plc
  The Royal Bank of Scotland
101 Park Avenue, 6th Floor
New York, NY 10178
Attn: Charlotte Sohn
101 Park Avenue, 12th Floor
New York, NY 10178
Tel: (212) 401-3703
Fax: (212) 401-3456
Email: Charlotte.Sohn@rbos.com
  The Royal Bank of Scotland
101 Park Avenue, 6th Floor
New York, NY 10178
Attn: Charlotte Sohn
101 Park Avenue, 12th Floor
New York, NY 10178
Tel: (212) 401-3703
Fax: (212) 401-3456
Email: Charlotte.Sohn@rbos.com     6.0000 %     8.0000 %     0.0000 %

 

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

 

                                  NAME AND                     NOTICE          
          ADDRESS OF           REVOLVING LOAN   TERM A   TERM B LENDER   LIBOR
OFFICE   DOMESTIC OFFICE   COMMITMENT   COMMITMENT   COMMITMENT
Commerzbank
AG, New York
and Grand
Cayman
Branches
  Commberzbank AG, New
York and Grand Cayman
Branches
2 World Financial Center
New York, NY 10281
Attn: Marianne Medora
Tel: (212) 266-7326
Fax: (212) 266-7374 Email: mmedora@cbkna.com   Commberzbank AG, New York and
Grand Cayman
Branches
2 World Financial Center
New York, NY 10281
Attn: Marianne Medora
Tel: (212) 266-7326
Fax: (212) 266-7374
Email: mmedora@cbkna.com     1.2000 %     1.6000 %     0.0000 %
 
                               
JPMorgan Chase
Bank, N.A.
  JPMorgan Chase Bank, N.A.
1 Chase Manhattan Plaza
14th Floor
New York, NY 10005
Tel: (212) 552-0789
Fax: (212) 383-0698
Email: virginia.r.conway@
jpmorgan.com   JPMorgan Chase Bank, N.A.
1 Chase Manhattan Plaza
14th Floor
New York, NY 10005
Tel: (212) 552-0789
Fax: (212) 383-0698
Email: virginia.r.conway@
jpmorgan.com     3.0000 %     0.0000 %     0.0000 %
 
                               
United Overseas
Bank Limited,
New York
Agency
  To be provided.   To be provided.     3.0000 %     4.0000 %     0.0000 %

 

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

 

                                  NAME AND                     NOTICE          
          ADDRESS OF           REVOLVING LOAN   TERM A   TERM B LENDER   LIBOR
OFFICE   DOMESTIC OFFICE   COMMITMENT   COMMITMENT   COMMITMENT
Sumitomo Mitsui
Banking
Corporation, New
York
  To be provided.   To be provided.     6.0000 %     8.0000 %     0.0000 %
 
                               
Israel Discount
Bank of New
York
  To be provided.   To be provided.     1.5000 %     3.0000 %     0.0000 %
 
                               
BNP Paribas
  BNP Paribas
787 Seventh Avenue
New York, NY 10019
Attn: Simone Vinocour
Tel: 212-841-2205
Fax: 212-841-3049
Email:simone.vinocour@
americas.bnpparibas.com   BNP Paribas
787 Seventh Avenue
New York, NY 10019
Attn: Simone Vinocour
Tel: 212-841-2205
Fax: 212-841-3049
Email:simone.vinocour@
americas.bnpparibas.com     3.0000 %     4.0000 %     0.0000 %
 
                               
Mizuho
Corporate Bank,
Ltd.
  To be provided.
  To be provided.     3.0000 %     4.0000 %     0.0000 %
 
                               
North Fork
Business Capital
Corp.
  North Fork Business Capital
Corp.
275 Broadhollow Road
Melville, New York 11747
Attn: Jose L. Gutierrez
Tel: (631) 531-2781
Fax: (631) 501-5524   North Fork Business Capital Corp.
275 Broadhollow Road
Melville, New York 11747
Attn: Jose L. Gutierrez
Tel: (631) 531-2781
Fax: (631) 501-5524     0.0000 %     4.0000 %     0.0000 %

 

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

 

                                  NAME AND                     NOTICE          
          ADDRESS OF           REVOLVING LOAN   TERM A   TERM B LENDER   LIBOR
OFFICE   DOMESTIC OFFICE   COMMITMENT   COMMITMENT   COMMITMENT
Banco Bilbao
Vizcaya
Argentaria S.A.
  To be provided.   To be provided.     1.8000 %     2.4000 %     0.0000 %
 
                               
Bayerische
Landesbank, New York Branch
  To be provided.   To be provided.     3.0000 %     4.0000 %     0.0000 %

NOTICE ADDRESS FOR ADMINISTRATIVE AGENT:
Citicorp USA, Inc.
2 Penns Way
Suite 100
New Castle, De 19720
Attention: Carin Seals
Fax: (302) 894-6076
Phone: (212) 994-0967
E-mail: carin.seals@citigroup.com
NOTICE ADDRESS FOR THE BORROWER:
Hanesbrands Inc.
1000 East Hanes Mill Rd
Winston Salem, NC 27105
Attn: General Counsel

 

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

 

SCHEDULE III
Existing Letters of Credit

                                  HSBC Bank                 Applicant Name   DC
number   Issue date   DC outstanding amount   Expiry date
DFK INTERNATIONAL LIMITED
  HKH254935     20060719     USD     60,124.49       20060828  
DFK INTERNATIONAL LIMITED
  HKH255059     20060814     USD     78,540.00       20060916  
DFK INTERNATIONAL LIMITED
  HKH255100     20060824     USD     36,844.50       20060923  
DFK INTERNATIONAL LIMITED
  HKH255058     20060814     USD     84,464.10       20060928  
DFK INTERNATIONAL LIMITED
  HKH255112     20060829     USD     45,570.00       20060930  
DFK INTERNATIONAL LIMITED
  HKH254940     20060720     USD     262,462.03       20061016  
DFK INTERNATIONAL LIMITED
  HKH255120     20060830     USD     168,968.63       20061109  
SARA LEE PRINTABLES GMBH
  HKH705166     20060213     USD     1,359.71       20060830  
SARA LEE PRINTABLES GMBH
  HKH705199     20060601     USD     106,362.81       20060830  
SARA LEE PRINTABLES GMBH
  HKH705173     20060216     USD     72,066.67       20060830  
SARA LEE PRINTABLES GMBH
  HKH705174     20060302     USD     10,332.16       20060830  
SARA LEE PRINTABLES GMBH
  HKH705177     20060314     USD     29,242.62       20060830  
SARA LEE PRINTABLES GMBH
  HKH705181     20060321     USD     14,322.83       20060830  
SARA LEE PRINTABLES GMBH
  HKH705198     20060601     USD     23,495.91       20060830  
SARA LEE PRINTABLES GMBH
  HKH705195     20060519     USD     6,371.57       20060830  
SARA LEE PRINTABLES GMBH
  HKH705194     20060519     USD     6,944.72       20060830  
SARA LEE PRINTABLES GMBH
  HKH705192     20060517     USD     26,601.47       20060830  

 

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

 

                                  HSBC Bank                 Applicant Name   DC
number   Issue date   DC outstanding amount   Expiry date
SARA LEE PRINTABLES GMBH
  HKH705193     20060517     USD     39,156.00       20060830  
SARA LEE PRINTABLES GMBH
  HKH705200     20060601     USD     63,054.96       20060920  
SARA LEE PRINTABLES GMBH
  HKH705191     20060427     USD     95,588.70       20060930  
SARA LEE PRINTABLES GMBH
  HKH705196     20060523     USD     235,403.51       20060930  
SARA LEE PRINTABLES GMBH
  HKH705188     20060420     USD     16,176.12       20060930  
SARA LEE PRINTABLES GMBH
  HKH705183     20060413     USD     447,104.76       20060930  
SARA LEE PRINTABLES GMBH
  HKH705182     20060413     USD     78,759.93       20060930  
SARA LEE PRINTABLES GMBH
  HKH705172     20060216     USD     12,911.56       20060930  
SARA LEE PRINTABLES GMBH
  HKH705204     20060620     USD     80,983.36       20060930  
SARA LEE PRINTABLES GMBH
  HKH705205     20060620     USD     881,820.72       20060930  
SARA LEE PRINTABLES GMBH
  HKH705206     20060620     USD     649,516.99       20060930  
SARA LEE PRINTABLES GMBH
  HKH705207     20060620     USD     513,687.78       20060930  
SARA LEE PRINTABLES GMBH
  HKH705208     20060620     USD     180,848.64       20060930  
SARA LEE PRINTABLES GMBH
  HKH705209     20060622     USD     46,981.44       20060930  
SARA LEE PRINTABLES GMBH
  HKH705210     20060622     USD     123,078.00       20060930  
SARA LEE PRINTABLES GMBH
  HKH705211     20060628     USD     187,666.29       20060930  
SARA LEE PRINTABLES GMBH
  HKH705212     20060628     USD     273,957.60       20060930  
SARA LEE PRINTABLES GMBH
  HKH705213     20060707     USD     56,376.18       20061030  
SARA LEE PRINTABLES GMBH
  HKH705223     20060721     USD     293,224.60       20061030  
SARA LEE PRINTABLES GMBH
  HKH705215     20060714     USD     725,338.99       20061030  

 

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

 

                                  HSBC Bank                 Applicant Name   DC
number   Issue date   DC outstanding amount   Expiry date
SARA LEE PRINTABLES GMBH
  HKH705216     20060714     USD     730,421.54       20061030  
SARA LEE PRINTABLES GMBH
  HKH705217     20060721     USD     279,970.32       20061030  
SARA LEE PRINTABLES GMBH
  HKH705218     20060721     USD     730,690.41       20061030  
SARA LEE PRINTABLES GMBH
  HKH705219     20060721     USD     343,921.34       20061030  
SARA LEE PRINTABLES GMBH
  HKH705220     20060721     USD     78,985.62       20061030  
SARA LEE PRINTABLES GMBH
  HKH705221     20060721     USD     46,256.24       20061030  
SARA LEE PRINTABLES GMBH
  HKH705222     20060721     USD     68,709.72       20061030  
SARA LEE PRINTABLES GMBH
  HKH705214     20060707     USD     142,701.30       20061130  
SARA LEE PRINTABLES GMBH
  HKH705235     20060815     USD     807,790.20       20061130  
SARA LEE PRINTABLES GMBH
  HKH705234     20060815     USD     428,685.96       20061130  
SARA LEE PRINTABLES GMBH
  HKH705226     20060815     USD     332,868.44       20061130  
SARA LEE PRINTABLES GMBH
  HKH705227     20060815     USD     337,013.07       20061130  
SARA LEE PRINTABLES GMBH
  HKH705228     20060815     USD     118,847.04       20061130  
SARA LEE PRINTABLES GMBH
  HKH705229     20060815     USD     11,642.40       20061130  
SARA LEE PRINTABLES GMBH
  HKH705230     20060815     USD     795,656.74       20061130  
SARA LEE PRINTABLES GMBH
  HKH705231     20060815     USD     65,175.71       20061130  
SARA LEE PRINTABLES GMBH
  HKH705232     20060815     USD     88,288.52       20061130  
SARA LEE PRINTABLES GMBH
  HKH705233     20060815     USD     78,008.99       20061130  
SARA LEE PRINTABLES GMBH
  HKH705236     20060825     USD     21,197.21       20061210  
SARA LEE PRINTABLES GMBH
  HKH705224     20060807     USD     557,884.11       20061215  

 

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

 

                                  HSBC Bank                 Applicant Name   DC
number   Issue date   DC outstanding amount   Expiry date
SARA LEE PRINTABLES GMBH
  HKH705225     20060811     USD     2,367,240.96       20070530  
CANADELLE A DIVISION OF THE
  HKH692114     20060327     USD     889.07       20060825  
CANADELLE A DIVISION OF THE
  HKH692120     20060404     USD     299.38       20060905  
CANADELLE A DIVISION OF THE
  HKH692122     20060421     USD     292.57       20060908  
CANADELLE A DIVISION OF THE
  HKH692146     20060801     USD     10,758.14       20060915  
CANADELLE A DIVISION OF THE
  HKH692125     20060525     USD     10,898.92       20060915  
CANADELLE A DIVISION OF THE
  HKH692123     20060508     USD     13,571.90       20060915  
CANADELLE A DIVISION OF THE
  HKH685496     20051212     USD     43,810.64       20060915  
CANADELLE A DIVISION OF THE
  HKH685493     20051125     USD     62,883.97       20060915  
CANADELLE A DIVISION OF THE
  HKH692137     20060630     USD     180,869.92       20060922  
CANADELLE A DIVISION OF THE
  HKH692130     20060605     USD     82,116.24       20060922  
CANADELLE A DIVISION OF THE
  HKH692145     20060725     USD     28,953.30       20060922  
CANADELLE A DIVISION OF THE
  HKH692126     20060525     USD     16,091.98       20061006  
CANADELLE A DIVISION OF THE
  HKH692147     20060801     USD     95,256.41       20061020  
CANADELLE A DIVISION OF THE
  HKH692102     20060203     USD     106,577.81       20061020  
CANADELLE A DIVISION OF THE
  HKH692135     20060609     USD     12,283.99       20061020  
CANADELLE A DIVISION OF THE
  HKH692134     20060609     USD     18,911.91       20061020  
CANADELLE A DIVISION OF THE
  HKH692155     20060821     USD     4,264.20       20061023  
CANADELLE A DIVISION OF THE
  HKH692138     20060703     USD     7,679.27       20061110  
CANADELLE A DIVISION OF THE
  HKH692139     20060703     USD     8,004.95       20061117  

 

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

 

                                  HSBC Bank                 Applicant Name   DC
number   Issue date   DC outstanding amount   Expiry date
CANADELLE A DIVISION OF THE
  HKH692152     20060821     USD     47,146.48       20061117  
CANADELLE A DIVISION OF THE
  HKH692124     20060508     USD     110,372.95       20061117  
CANADELLE A DIVISION OF THE
  HKH692133     20060609     USD     129,474.09       20061117  
CANADELLE A DIVISION OF THE
  HKH692143     20060725     USD     92,966.04       20061117  
CANADELLE A DIVISION OF THE
  HKH692142     20060725     USD     3,933.45       20061208  
CANADELLE A DIVISION OF THE
  HKH692140     20060703     USD     5,141.76       20061221  
CANADELLE A DIVISION OF THE
  HKH692150     20060814     USD     58,349.09       20061222  
CANADELLE A DIVISION OF THE
  HKH692149     20060814     USD     28,530.84       20061222  
CANADELLE A DIVISION OF THE
  HKH692141     20060725     USD     21,789.69       20061222  
CANADELLE A DIVISION OF THE
  HKH692153     20060821     USD     32,612.60       20061222  
CANADELLE A DIVISION OF THE
  HKH692154     20060821     USD     126,163.16       20061222  
CANADELLE A DIVISION OF THE
  HKH692151     20060821     USD     24,511.73       20061222  
CANADELLE A DIVISION OF THE
  HKH692144     20060725     USD     50,585.88       20061222  
CANADELLE A DIVISION OF THE
  HKH692148     20060807     USD     5,870.51       20061229  
CANADELLE A DIVISION OF THE
  HKH692156     20060821     USD     10,044.97       20070105  
CHAMPION ATHLETICWEAR
  HKH691324     20060613     USD     15,230.90       20060823  
CHAMPION ATHLETICWEAR
  HKH691244     20060411     USD     217.06       20060823  
CHAMPION ATHLETICWEAR
  HKH691423     20060718     USD     535,381.11       20060824  
CHAMPION ATHLETICWEAR
  HKH691402     20060711     USD     90,756.63       20060824  
CHAMPION ATHLETICWEAR
  HKH691449     20060807     USD     590,748.45       20060824  

 

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

 

                                  HSBC Bank                 Applicant Name   DC
number   Issue date   DC outstanding amount   Expiry date
CHAMPION ATHLETICWEAR
  HKH691392     20060704     USD     56,813.61       20060824  
CHAMPION ATHLETICWEAR
  HKH691448     20060807     USD     167,556.10       20060824  
CHAMPION ATHLETICWEAR
  HKH691427     20060721     USD     599,994.50       20060824  
CHAMPION ATHLETICWEAR
  HKH691383     20060704     USD     356,707.45       20060825  
CHAMPION ATHLETICWEAR
  HKH691311     20060601     USD     11,547.47       20060825  
CHAMPION ATHLETICWEAR
  HKH691259     20060424     USD     10,606.95       20060825  
CHAMPION ATHLETICWEAR
  HKH691341     20060615     USD     5,555.88       20060825  
CHAMPION ATHLETICWEAR
  HKH691243     20060411     USD     414,517.32       20060825  
CHAMPION ATHLETICWEAR
  HKH691384     20060704     USD     63,002.57       20060826  
CHAMPION ATHLETICWEAR
  HKH691406     20060712     USD     2,287.80       20060826  
CHAMPION ATHLETICWEAR
  HKH691304     20060526     USD     391.38       20060826  
CHAMPION ATHLETICWEAR
  HKH691381     20060704     USD     444,433.28       20060826  
CHAMPION ATHLETICWEAR
  HKH691380     20060704     USD     134,924.20       20060826  
CHAMPION ATHLETICWEAR
  HKH691436     20060727     USD     20,755.56       20060826  
CHAMPION ATHLETICWEAR
  HKH691385     20060704     USD     11,262.70       20060828  
CHAMPION ATHLETICWEAR
  HKH691350     20060621     USD     15,706.94       20060828  
CHAMPION ATHLETICWEAR
  HKH691416     20060714     USD     638,919.58       20060828  
CHAMPION ATHLETICWEAR
  HKH691415     20060714     USD     4,158.22       20060830  
CHAMPION ATHLETICWEAR
  HKH691428     20060721     USD     608,481.44       20060831  
CHAMPION ATHLETICWEAR
  HKH691412     20060714     USD     678,840.50       20060831  

 

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

 

                                  HSBC Bank                 Applicant Name   DC
number   Issue date   DC outstanding amount   Expiry date
CHAMPION ATHLETICWEAR
  HKH691407     20060712     USD     342,445.41       20060831  
CHAMPION ATHLETICWEAR
  HKH691444     20060807     USD     452,867.31       20060831  
CHAMPION ATHLETICWEAR
  HKH691312     20060601     USD     19,849.14       20060901  
CHAMPION ATHLETICWEAR
  HKH691303     20060526     USD     10,659.45       20060901  
CHAMPION ATHLETICWEAR
  HKH691267     20060425     USD     (155.65 )     20060901  
CHAMPION ATHLETICWEAR
  HKH691457     20060816     USD     21,030.54       20060902  
CHAMPION ATHLETICWEAR
  HKH691458     20060816     USD     122,927.62       20060902  
CHAMPION ATHLETICWEAR
  HKH691287     20060516     USD     83,446.69       20060902  
CHAMPION ATHLETICWEAR
  HKH691285     20060516     USD     10,837.87       20060902  
CHAMPION ATHLETICWEAR
  HKH691349     20060621     USD     18,796.37       20060904  
CHAMPION ATHLETICWEAR
  HKH691389     20060704     USD     167,774.06       20060906  
CHAMPION ATHLETICWEAR
  HKH691390     20060704     USD     204,829.41       20060906  
CHAMPION ATHLETICWEAR
  HKH691442     20060804     USD     735,990.00       20060907  
CHAMPION ATHLETICWEAR
  HKH691429     20060720     USD     660,782.66       20060907  
CHAMPION ATHLETICWEAR
  HKH691374     20060703     USD     330,196.25       20060907  
CHAMPION ATHLETICWEAR
  HKH691306     20060529     USD     368,342.83       20060907  
CHAMPION ATHLETICWEAR
  HKH691470     20060822     USD     113,648.22       20060910  
CHAMPION ATHLETICWEAR
  HKH691443     20060807     USD     729,817.96       20060910  
CHAMPION ATHLETICWEAR
  HKH691445     20060807     USD     331,042.82       20060910  
CHAMPION ATHLETICWEAR
  HKH691411     20060714     USD     8,180.95       20060911  

 

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

 

                                  HSBC Bank                 Applicant Name   DC
number   Issue date   DC outstanding amount   Expiry date
CHAMPION ATHLETICWEAR
  HKH691450     20060807     USD     733,286.66       20060914  
CHAMPION ATHLETICWEAR
  HKH691413     20060714     USD     696,668.14       20060914  
CHAMPION ATHLETICWEAR
  HKH691302     20060526     USD     1,270.20       20060915  
CHAMPION ATHLETICWEAR
  HKH691286     20060516     USD     65,826.27       20060916  
CHAMPION ATHLETICWEAR
  HKH691277     20060508     USD     4,550.51       20060917  
CHAMPION ATHLETICWEAR
  HKH691459     20060816     USD     49,304.79       20060918  
CHAMPION ATHLETICWEAR
  HKH691319     20060606     USD     34,949.01       20060918  
CHAMPION ATHLETICWEAR
  HKH691373     20060703     USD     164,935.59       20060920  
CHAMPION ATHLETICWEAR
  HKH691417     20060714     USD     145,197.31       20060920  
CHAMPION ATHLETICWEAR
  HKH691465     20060821     USD     656,835.97       20060921  
CHAMPION ATHLETICWEAR
  HKH691478     20060831     USD     61,199.80       20060921  
CHAMPION ATHLETICWEAR
  HKH691456     20060815     USD     35,754.39       20060921  
CHAMPION ATHLETICWEAR
  HKH691441     20060804     USD     665,962.51       20060922  
CHAMPION ATHLETICWEAR
  HKH691331     20060613     USD     85,041.82       20060922  
CHAMPION ATHLETICWEAR
  HKH691473     20060823     USD     118,997.96       20060923  
CHAMPION ATHLETICWEAR
  HKH691378     20060704     USD     105,761.23       20060923  
CHAMPION ATHLETICWEAR
  HKH691394     20060705     USD     453,528.63       20060923  
CHAMPION ATHLETICWEAR
  HKH691472     20060824     USD     276,673.45       20060923  
CHAMPION ATHLETICWEAR
  HKH691372     20060704     USD     162,724.64       20060923  
CHAMPION ATHLETICWEAR
  HKH691439     20060727     USD     52,900.80       20060925  

 

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

 

                                  HSBC Bank                 Applicant Name   DC
number   Issue date   DC outstanding amount   Expiry date
CHAMPION ATHLETICWEAR
  HKH691352     20060621     USD     8,349.78       20060926  
CHAMPION ATHLETICWEAR
  HKH691453     20060808     USD     46,201.68       20060928  
CHAMPION ATHLETICWEAR
  HKH691464     20060821     USD     649,099.97       20060928  
CHAMPION ATHLETICWEAR
  HKH691463     20060821     USD     698,467.13       20060928  
CHAMPION ATHLETICWEAR
  HKH691419     20060718     USD     299,935.30       20060928  
CHAMPION ATHLETICWEAR
  HKH691288     20060516     USD     82,161.86       20060929  
CHAMPION ATHLETICWEAR
  HKH691468     20060821     USD     180,473.18       20060930  
CHAMPION ATHLETICWEAR
  HKH691371     20060703     USD     148,751.98       20060930  
CHAMPION ATHLETICWEAR
  HKH691477     20060831     USD     347,494.30       20061001  
CHAMPION ATHLETICWEAR
  HKH691309     20060529     USD     1,784,033.64       20061005  
CHAMPION ATHLETICWEAR
  HKH691451     20060807     USD     269,049.39       20061005  
CHAMPION ATHLETICWEAR
  HKH691479     20060831     USD     70,405.03       20061007  
CHAMPION ATHLETICWEAR
  HKH691401     20060711     USD     102.77       20061007  
CHAMPION ATHLETICWEAR
  HKH691425     20060720     USD     566,923.97       20061008  
CHAMPION ATHLETICWEAR
  HKH691424     20060720     USD     487,217.39       20061008  
CHAMPION ATHLETICWEAR
  HKH691452     20060808     USD     5,049.92       20061009  
CHAMPION ATHLETICWEAR
  HKH691481     20060831     USD     232,397.05       20061011  
CHAMPION ATHLETICWEAR
  HKH691354     20060626     USD     303,053.73       20061014  
CHAMPION ATHLETICWEAR
  HKH691355     20060626     USD     127,918.50       20061014  
CHAMPION ATHLETICWEAR
  HKH691399     20060711     USD     57,071.68       20061014  

 

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

 

                                  HSBC Bank                 Applicant Name   DC
number   Issue date   DC outstanding amount   Expiry date
CHAMPION ATHLETICWEAR
  HKH691422     20060718     USD     607,392.17       20061015  
CHAMPION ATHLETICWEAR
  HKH691434     20060720     USD     574,087.64       20061015  
CHAMPION ATHLETICWEAR
  HKH691421     20060718     USD     513,071.04       20061015  
CHAMPION ATHLETICWEAR
  HKH691454     20060815     USD     275,631.17       20061017  
CHAMPION ATHLETICWEAR
  HKH691420     20060718     USD     75,089.20       20061017  
CHAMPION ATHLETICWEAR
  HKH691455     20060815     USD     251,340.11       20061022  
CHAMPION ATHLETICWEAR
  HKH691474     20060825     USD     128,108.47       20061026  
CHAMPION ATHLETICWEAR
  HKH691430     20060720     USD     23,533.44       20061028  
CHAMPION ATHLETICWEAR
  HKH691440     20060804     USD     18,947.88       20061028  
CHAMPION ATHLETICWEAR
  HKH691467     20060822     USD     123,487.52       20061030  
CHAMPION ATHLETICWEAR
  HKH691471     20060822     USD     92,700.00       20061104  
CHAMPION ATHLETICWEAR
  HKH691356     20060626     USD     188,547.97       20061111  
CHAMPION ATHLETICWEAR
  HKH691461     20060816     USD     488,251.89       20061112  
CHAMPION ATHLETICWEAR
  HKH691462     20060816     USD     318,767.80       20061112  
CHAMPION ATHLETICWEAR
  HKH691366     20060630     USD     24,843.60       20061114  
CHAMPION ATHLETICWEAR
  HKH691398     20060711     USD     25,340.47       20061114  
CHAMPION ATHLETICWEAR
  HKH691460     20060816     USD     428,581.02       20061118  
CHAMPION ATHLETICWEAR
  HKH691409     20060714     USD     24,843.60       20061202  
CHAMPION ATHLETICWEAR
  HKH691446     20060807     USD     444,861.49       20061209  
CHAMPION ATHLETICWEAR
  HKH691476     20060831     USD     140,162.40       20061215  

 

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

 

                                  HSBC Bank                 Applicant Name   DC
number   Issue date   DC outstanding amount   Expiry date
CHAMPION ATHLETICWEAR
  HKH691480     20060831     USD     42,475.26       20061224  
CHAMPION ATHLETICWEAR
  HKH691466     20060821     USD     17,407.33       20061230  
CHAMPION ATHLETICWEAR
  HKH691447     20060807     USD     258,316.09       20061230  
CHAMPION ATHLETICWEAR
  HKH691475     20060825     USD     67,222.58       20070106  
CHAMPION JOGBRA
  HKH682730     20060725     USD     26,324.33       20060916  
CHAMPION JOGBRA
  HKH682729     20060630     USD     269,222.54       20061105  
HANES PRINTABLES, OUTER BANKS
GROUP
  HKH684146     20060502     USD     25,105.15       20060920  
HANES PRINTABLES, OUTER BANKS
GROUP
  HKH684149     20060522     USD     18,288.47       20060922  
HANES PRINTABLES, OUTER BANKS
GROUP
  HKH684148     20060516     USD     18,231.00       20060922  
HANES PRINTABLES, OUTER BANKS
GROUP
  HKH684152     20060613     USD     318,190.06       20060928  
HANES PRINTABLES, OUTER BANKS
GROUP
  HKH684153     20060613     USD     561,488.10       20061005  
HANES PRINTABLES, OUTER BANKS
GROUP
  HKH684155     20060704     USD     270,951.96       20061015  
HANES PRINTABLES, OUTER BANKS
GROUP
  HKH684160     20060807     USD     580,179.02       20061025  
HANES PRINTABLES, OUTER BANKS
GROUP
  HKH684151     20060613     USD     47,255.37       20061105  
HANES PRINTABLES, OUTER BANKS
GROUP
  HKH684157     20060718     USD     222,965.87       20061109  

 

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

 

                                  HSBC Bank                 Applicant Name   DC
number   Issue date   DC outstanding amount   Expiry date
HANES PRINTABLES, OUTER BANKS
GROUP
  HKH684158     20060726     USD     26,574.00       20061120  
HANES PRINTABLES, OUTER BANKS
GROUP
  HKH684159     20060727     USD     37,762.89       20061205  
HANES PRINTABLES, OUTER BANKS
GROUP
  HKH684163     20060831     USD     527,097.02       20061210  
HANES PRINTABLES, OUTER BANKS
GROUP
  HKH684161     20060811     USD     60,873.00       20061225  
HANES PRINTABLES, OUTER BANKS
GROUP
  HKH684162     20060816     USD     33,897.92       20061225  
J.E. MORGAN KNITTING MILLS INC.
  HKH688544     20060502     USD     7,938.11       20060830  
J.E. MORGAN KNITTING MILLS INC.
  HKH688553     20060804     USD     108,579.44       20060830  
J.E. MORGAN KNITTING MILLS INC.
  HKH688539     20060307     USD     208,752.52       20060901  
J.E. MORGAN KNITTING MILLS INC.
  HKH688540     20060307     USD     257,575.48       20060901  
J.E. MORGAN KNITTING MILLS INC.
  HKH688551     20060623     USD     112,051.82       20060915  
J.E. MORGAN KNITTING MILLS INC.
  HKH688547     20060605     USD     28.81       20060915  
J.E. MORGAN KNITTING MILLS INC.
  HKH688555     20060831     USD     26,442.84       20061001  
J.E. MORGAN KNITTING MILLS INC.
  HKH688552     20060714     USD     78,048.19       20061022  
J.E. MORGAN KNITTING MILLS INC.
  HKH688554     20060824     USD     20,637.03       20061022  
SARA LEE CASUALWEAR
  HKH680244     20060519     USD     1,822,383.63       20060904  
SARA LEE CASUALWEAR
  HKH680248     20060512     USD     175,257.11       20060910  

 

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

 

                                  HSBC Bank                 Applicant Name   DC
number   Issue date   DC outstanding amount   Expiry date
SARA LEE CASUALWEAR
  HKH680245     20060515     USD     1,353,619.00       20060910  
SARA LEE CASUALWEAR
  HKH680246     20060512     USD     1,315,824.59       20060918  
SARA LEE CASUALWEAR
  HKH680254     20060630     USD     32,120.55       20060919  
SARA LEE CASUALWEAR
  HKH680250     20060606     USD     58,073.78       20060920  
SARA LEE CASUALWEAR
  HKH691300     20060621     USD     282,873.53       20060922  
SARA LEE CASUALWEAR
  HKH680255     20060727     USD     158,724.65       20060923  
SARA LEE CASUALWEAR
  HKH691400     20060727     USD     30,815.79       20060930  
SARA LEE CASUALWEAR
  HKH691437     20060823     USD     60,764.48       20060930  
SARA LEE CASUALWEAR
  HKH691339     20060713     USD     59,626.91       20061006  
SARA LEE CASUALWEAR
  HKH680253     20060630     USD     1,468,979.82       20061017  
SARA LEE CASUALWEAR
  HKH680247     20060515     USD     1,670,602.32       20061023  
SARA LEE CASUALWEAR
  HKH680252     20060630     USD     2,129,501.93       20061024  
SARA LEE CASUALWEAR
  HKH680243     20060512     USD     912,620.38       20061106  
SARA LEE HOSIERY
  HKH681369     20060612     USD     687.42       20060830  
SARA LEE HOSIERY
  HKH681371     20060613     USD     3,621.78       20060907  
SARA LEE HOSIERY
  HKH681364     20060418     USD     7,797.55       20060914  
SARA LEE HOSIERY
  HKH681370     20060613     USD     77,140.35       20060914  
SARA LEE HOSIERY
  HKH681368     20060612     USD     2,164.50       20060928  
SARA LEE INTIMATES AND HOSIERY
  HKH689496     20060410     USD     60,255.51       20060831  
SARA LEE INTIMATES AND HOSIERY
  HKH689497     20060410     USD     166,831.35       20060831  

 

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

 

                                  HSBC Bank                 Applicant Name   DC
number   Issue date   DC outstanding amount   Expiry date
SARA LEE INTIMATES AND HOSIERY
  HKH689499     20060410     USD     211,935.60       20060831  
SARA LEE INTIMATES AND HOSIERY
  HKH689500     20060410     USD     202,640.52       20060831  
SARA LEE INTIMATES AND HOSIERY
  HKH689501     20060410     USD     664.91       20060831  
SARA LEE INTIMATES AND HOSIERY
  HKH689502     20060410     USD     184.79       20060831  
SARA LEE INTIMATES AND HOSIERY
  HKH689503     20060411     USD     23,633.75       20060831  
SARA LEE INTIMATES AND HOSIERY
  HKH689504     20060410     USD     2,036.08       20060831  
SARA LEE INTIMATES AND HOSIERY
  HKH689506     20060410     USD     40,541.52       20060831  
SARA LEE INTIMATES AND HOSIERY
  HKH689507     20060410     USD     23,711.23       20060831  
SARA LEE INTIMATES AND HOSIERY
  HKH689495     20060410     USD     4,741.95       20060902  
SARA LEE INTIMATES AND HOSIERY
  HKH689508     20060511     USD     19,770.46       20060904  
SARA LEE INTIMATES AND HOSIERY
  HKH689505     20060410     USD     189,189.43       20060928  
SARA LEE INTIMATES AND HOSIERY
  HKH689518     20060511     USD     504,625.53       20060930  
SARA LEE INTIMATES AND HOSIERY
  HKH689519     20060511     USD     25,782.45       20060930  
SARA LEE INTIMATES AND HOSIERY
  HKH689520     20060511     USD     43,906.09       20060930  
SARA LEE INTIMATES AND HOSIERY
  HKH689521     20060511     USD     7,558.64       20060930  
SARA LEE INTIMATES AND HOSIERY
  HKH689509     20060511     USD     284,763.52       20060930  
SARA LEE INTIMATES AND HOSIERY
  HKH689510     20060511     USD     3,996.89       20060930  
SARA LEE INTIMATES AND HOSIERY
  HKH689511     20060511     USD     2,373.58       20060930  
SARA LEE INTIMATES AND HOSIERY
  HKH689512     20060511     USD     267,122.25       20060930  
SARA LEE INTIMATES AND HOSIERY
  HKH689513     20060511     USD     348,147.31       20060930  

 

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

 

                                  HSBC Bank                 Applicant Name   DC
number   Issue date   DC outstanding amount   Expiry date
SARA LEE INTIMATES AND HOSIERY
  HKH689514     20060511     USD     7,779.92       20060930  
SARA LEE INTIMATES AND HOSIERY
  HKH689515     20060511     USD     12,400.78       20060930  
SARA LEE INTIMATES AND HOSIERY
  HKH689516     20060511     USD     55,319.23       20060930  
SARA LEE INTIMATES AND HOSIERY
  HKH689517     20060511     USD     3,303.39       20060930  
SARA LEE INTIMATES AND HOSIERY
  HKH689522     20060612     USD     521,741.93       20061002  
SARA LEE INTIMATES AND HOSIERY
  HKH689523     20060612     USD     14,607.69       20061002  
SARA LEE INTIMATES AND HOSIERY
  HKH689534     20060612     USD     303,450.80       20061002  
SARA LEE INTIMATES AND HOSIERY
  HKH689537     20060707     USD     100,709.28       20061025  
SARA LEE INTIMATES AND HOSIERY
  HKH689554     20060711     USD     185,890.69       20061026  
SARA LEE INTIMATES AND HOSIERY
  HKH689539     20060711     USD     36,404.58       20061030  
SARA LEE INTIMATES AND HOSIERY
  HKH689540     20060711     USD     973,509.16       20061030  
SARA LEE INTIMATES AND HOSIERY
  HKH689541     20060711     USD     305,174.16       20061030  
SARA LEE INTIMATES AND HOSIERY
  HKH689542     20060711     USD     8,343.00       20061030  
SARA LEE INTIMATES AND HOSIERY
  HKH689543     20060814     USD     58,241.56       20061030  
SARA LEE INTIMATES AND HOSIERY
  HKH689544     20060711     USD     3,950,148.22       20061030  
SARA LEE INTIMATES AND HOSIERY
  HKH689545     20060711     USD     1,208,184.03       20061030  
SARA LEE INTIMATES AND HOSIERY
  HKH689546     20060711     USD     52,261.79       20061030  
SARA LEE INTIMATES AND HOSIERY
  HKH689547     20060711     USD     1,263,968.09       20061030  
SARA LEE INTIMATES AND HOSIERY
  HKH689548     20060711     USD     1,598,046.07       20061030  
SARA LEE INTIMATES AND HOSIERY
  HKH689549     20060711     USD     82,038.49       20061030  

 

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

 

                                  HSBC Bank                 Applicant Name   DC
number   Issue date   DC outstanding amount   Expiry date
SARA LEE INTIMATES AND HOSIERY
  HKH689550     20060711     USD     411,097.06       20061030  
SARA LEE INTIMATES AND HOSIERY
  HKH689551     20060711     USD     596,514.21       20061030  
SARA LEE INTIMATES AND HOSIERY
  HKH689552     20060711     USD     295,685.35       20061030  
SARA LEE INTIMATES AND HOSIERY
  HKH689553     20060711     USD     559,054.25       20061030  
SARA LEE INTIMATES AND HOSIERY
  HKH689529     20060612     USD     61,099.06       20061102  
SARA LEE INTIMATES AND HOSIERY
  HKH689524     20060612     USD     81,082.84       20061102  
SARA LEE INTIMATES AND HOSIERY
  HKH689525     20060612     USD     828,630.00       20061102  
SARA LEE INTIMATES AND HOSIERY
  HKH689526     20060612     USD     24,102.00       20061102  
SARA LEE INTIMATES AND HOSIERY
  HKH689527     20060612     USD     1,950,309.96       20061102  
SARA LEE INTIMATES AND HOSIERY
  HKH689528     20060612     USD     799,577.19       20061102  
SARA LEE INTIMATES AND HOSIERY
  HKH689536     20060612     USD     16,974.36       20061102  
SARA LEE INTIMATES AND HOSIERY
  HKH689530     20060612     USD     235,981.69       20061102  
SARA LEE INTIMATES AND HOSIERY
  HKH689531     20060612     USD     439,687.27       20061102  
SARA LEE INTIMATES AND HOSIERY
  HKH689532     20060612     USD     60,821.09       20061102  
SARA LEE INTIMATES AND HOSIERY
  HKH689533     20060612     USD     319,956.32       20061102  
SARA LEE INTIMATES AND HOSIERY
  HKH689538     20060612     USD     299,074.77       20061102  
SARA LEE INTIMATES AND HOSIERY
  HKH689535     20060612     USD     246,933.53       20061102  
SARA LEE INTIMATES AND HOSIERY
  HKH689569     20060809     USD     454,894.72       20061204  
SARA LEE INTIMATES AND HOSIERY
  HKH689555     20060809     USD     154,258.18       20061204  
SARA LEE INTIMATES AND HOSIERY
  HKH689556     20060809     USD     115,367.75       20061204  

 

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

 

                                  HSBC Bank                 Applicant Name   DC
number   Issue date   DC outstanding amount   Expiry date
SARA LEE INTIMATES AND HOSIERY
  HKH689557     20060810     USD     56,641.18       20061204  
SARA LEE INTIMATES AND HOSIERY
  HKH689558     20060809     USD     1,242,315.96       20061204  
SARA LEE INTIMATES AND HOSIERY
  HKH689559     20060809     USD     1,632,435.40       20061204  
SARA LEE INTIMATES AND HOSIERY
  HKH689560     20060809     USD     161,858.40       20061204  
SARA LEE INTIMATES AND HOSIERY
  HKH689561     20060809     USD     237,720.13       20061204  
SARA LEE INTIMATES AND HOSIERY
  HKH689562     20060809     USD     464,936.85       20061204  
SARA LEE INTIMATES AND HOSIERY
  HKH689563     20060809     USD     18,490.56       20061204  
SARA LEE INTIMATES AND HOSIERY
  HKH689564     20060809     USD     1,032,667.99       20061204  
SARA LEE INTIMATES AND HOSIERY
  HKH689565     20060809     USD     495,260.46       20061204  
SARA LEE INTIMATES AND HOSIERY
  HKH689566     20060809     USD     379,632.52       20061204  
SARA LEE INTIMATES AND HOSIERY
  HKH689567     20060809     USD     52,060.32       20061204  
SARA LEE INTIMATES AND HOSIERY
  HKH689568     20060809     USD     109,701.18       20061204  
SARA LEE UNDERWEAR
  HKH682031     20060719     USD     33,623.84       20060827  
SARA LEE UNDERWEAR
  HKH682029     20060719     USD     1,650.49       20060827  
SARA LEE UNDERWEAR
  HKH681954     20060510     USD     406,784.52       20060827  
SARA LEE UNDERWEAR
  HKH681965     20060522     USD     52,600.80       20060830  
SARA LEE UNDERWEAR
  HKH681938     20060427     USD     58,765.58       20060830  
SARA LEE UNDERWEAR
  HKH682014     20060626     USD     15,965.91       20060831  
SARA LEE UNDERWEAR
  HKH681994     20060613     USD     27,903.75       20060904  
SARA LEE UNDERWEAR
  HKH681976     20060602     USD     660,541.27       20060905  

 

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

 

                                  HSBC Bank                 Applicant Name   DC
number   Issue date   DC outstanding amount   Expiry date
SARA LEE UNDERWEAR
  HKH682053     20060807     USD     136,223.93       20060907  
SARA LEE UNDERWEAR
  HKH681988     20060613     USD     545,081.24       20060909  
SARA LEE UNDERWEAR
  HKH681987     20060613     USD     131,056.14       20060909  
SARA LEE UNDERWEAR
  HKH682001     20060711     USD     54,652.72       20060909  
SARA LEE UNDERWEAR
  HKH682074     20060815     USD     73,812.10       20060910  
SARA LEE UNDERWEAR
  HKH682073     20060815     USD     90,762.05       20060910  
SARA LEE UNDERWEAR
  HKH682043     20060719     USD     59,317.30       20060913  
SARA LEE UNDERWEAR
  HKH682008     20060623     USD     187,445.80       20060913  
SARA LEE UNDERWEAR
  HKH682011     20060623     USD     44,414.98       20060913  
SARA LEE UNDERWEAR
  HKH681993     20060613     USD     16,240.80       20060913  
SARA LEE UNDERWEAR
  HKH682013     20060623     USD     241,568.57       20060913  
SARA LEE UNDERWEAR
  HKH682006     20060623     USD     40,937.46       20060914  
SARA LEE UNDERWEAR
  HKH681983     20060605     USD     36,125.68       20060916  
SARA LEE UNDERWEAR
  HKH682032     20060719     USD     162,197.87       20060917  
SARA LEE UNDERWEAR
  HKH682065     20060814     USD     87,300.99       20060917  
SARA LEE UNDERWEAR
  HKH681997     20060619     USD     127,664.00       20060919  
SARA LEE UNDERWEAR
  HKH682066     20060814     USD     346,212.48       20060924  
SARA LEE UNDERWEAR
  HKH681996     20060613     USD     74,294.39       20060924  
SARA LEE UNDERWEAR
  HKH682067     20060814     USD     184,689.36       20060924  
SARA LEE UNDERWEAR
  HKH681992     20060613     USD     243,607.93       20060925  

 

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

 

                                  HSBC Bank                 Applicant Name   DC
number   Issue date   DC outstanding amount   Expiry date
SARA LEE UNDERWEAR
  HKH682035     20060719     USD     355,747.25       20060925  
SARA LEE UNDERWEAR
  HKH681961     20060522     USD     311,080.00       20060926  
SARA LEE UNDERWEAR
  HKH682012     20060623     USD     36,790.87       20060927  
SARA LEE UNDERWEAR
  HKH682039     20060719     USD     240,876.15       20060930  
SARA LEE UNDERWEAR
  HKH682062     20060809     USD     68,882.00       20060930  
SARA LEE UNDERWEAR
  HKH682077     20060821     USD     100,713.98       20061001  
SARA LEE UNDERWEAR
  HKH682076     20060821     USD     105,420.67       20061001  
SARA LEE UNDERWEAR
  HKH682078     20060821     USD     57,155.90       20061001  
SARA LEE UNDERWEAR
  HKH682093     20060831     USD     119,388.96       20061008  
SARA LEE UNDERWEAR
  HKH682094     20060831     USD     123,075.65       20061008  
SARA LEE UNDERWEAR
  HKH682034     20060719     USD     277,783.13       20061010  
SARA LEE UNDERWEAR
  HKH682018     20060703     USD     65,513.45       20061010  
SARA LEE UNDERWEAR
  HKH682042     20060719     USD     389,891.61       20061011  
SARA LEE UNDERWEAR
  HKH682070     20060815     USD     248,434.55       20061011  
SARA LEE UNDERWEAR
  HKH682057     20060804     USD     62,453.75       20061011  
SARA LEE UNDERWEAR
  HKH682037     20060719     USD     191,893.39       20061011  
SARA LEE UNDERWEAR
  HKH682055     20060804     USD     539,138.00       20061011  
SARA LEE UNDERWEAR
  HKH682040     20060719     USD     91,289.90       20061011  
SARA LEE UNDERWEAR
  HKH682060     20060804     USD     378,578.30       20061011  
SARA LEE UNDERWEAR
  HKH682036     20060719     USD     49,025.40       20061011  

 

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

 

                                  HSBC Bank                 Applicant Name   DC
number   Issue date   DC outstanding amount   Expiry date
SARA LEE UNDERWEAR
  HKH682051     20060728     USD     235,016.31       20061014  
SARA LEE UNDERWEAR
  HKH682019     20060703     USD     33,936.00       20061015  
SARA LEE UNDERWEAR
  HKH682007     20060623     USD     344,935.98       20061015  
SARA LEE UNDERWEAR
  HKH682026     20060719     USD     33,936.00       20061015  
SARA LEE UNDERWEAR
  HKH682085     20060824     USD     79,378.43       20061015  
SARA LEE UNDERWEAR
  HKH682010     20060623     USD     259,840.43       20061019  
SARA LEE UNDERWEAR
  HKH682095     20060831     USD     56,764.02       20061022  
SARA LEE UNDERWEAR
  HKH682052     20060807     USD     522,063.14       20061025  
SARA LEE UNDERWEAR
  HKH682041     20060719     USD     106,134.84       20061027  
SARA LEE UNDERWEAR
  HKH682023     20060707     USD     300,170.71       20061030  
SARA LEE UNDERWEAR
  HKH682021     20060707     USD     418,498.51       20061030  
SARA LEE UNDERWEAR
  HKH682020     20060707     USD     488,772.21       20061030  
SARA LEE UNDERWEAR
  HKH682027     20060719     USD     111,820.64       20061030  
SARA LEE UNDERWEAR
  HKH682024     20060707     USD     469,981.60       20061030  
SARA LEE UNDERWEAR
  HKH682033     20060719     USD     144,213.91       20061104  
SARA LEE UNDERWEAR
  HKH681803     20051115     USD     1,467.04       20061104  
SARA LEE UNDERWEAR
  HKH682069     20060815     USD     245,869.35       20061108  
SARA LEE UNDERWEAR
  HKH682091     20060829     USD     234,825.00       20061108  
SARA LEE UNDERWEAR
  HKH682081     20060824     USD     242,779.72       20061108  
SARA LEE UNDERWEAR
  HKH682068     20060815     USD     53,610.80       20061108  

 

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

 

                                  HSBC Bank                 Applicant Name   DC
number   Issue date   DC outstanding amount   Expiry date
SARA LEE UNDERWEAR
  HKH682083     20060824     USD     418,792.82       20061108  
SARA LEE UNDERWEAR
  HKH682092     20060829     USD     6,590.25       20061111  
SARA LEE UNDERWEAR
  HKH682090     20060829     USD     351,609.89       20061111  
SARA LEE UNDERWEAR
  HKH682088     20060829     USD     553,908.60       20061111  
SARA LEE UNDERWEAR
  HKH682059     20060804     USD     46,413.54       20061114  
SARA LEE UNDERWEAR
  HKH682058     20060804     USD     119,360.97       20061114  
SARA LEE UNDERWEAR
  HKH682048     20060728     USD     385,076.16       20061114  
SARA LEE UNDERWEAR
  HKH682049     20060728     USD     453,635.36       20061114  
SARA LEE UNDERWEAR
  HKH682075     20060821     USD     468,416.05       20061115  
SARA LEE UNDERWEAR
  HKH682072     20060815     USD     366,772.92       20061115  
SARA LEE UNDERWEAR
  HKH682086     20060824     USD     27,955.14       20061115  
SARA LEE UNDERWEAR
  HKH682063     20060809     USD     10,049.00       20061115  
SARA LEE UNDERWEAR
  HKH682054     20060804     USD     325,453.41       20061116  
SARA LEE UNDERWEAR
  HKH682038     20060719     USD     201,776.29       20061118  
SARA LEE UNDERWEAR
  HKH682084     20060824     USD     550,937.63       20061119  
SARA LEE UNDERWEAR
  HKH682082     20060824     USD     223,011.64       20061125  
SARA LEE UNDERWEAR
  HKH682071     20060815     USD     318,683.28       20061126  
SARA LEE UNDERWEAR
  HKH682064     20060809     USD     30,722.38       20061126  
SARA LEE UNDERWEAR
  HKH682047     20060728     USD     688,626.16       20061130  
SARA LEE UNDERWEAR
  HKH682056     20060804     USD     210,188.07       20061203  

 

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

 

                                  HSBC Bank                 Applicant Name   DC
number   Issue date   DC outstanding amount   Expiry date
SARA LEE UNDERWEAR
  HKH682096     20060831     USD     103,488.64       20061212  
SARA LEE UNDERWEAR
  HKH682089     20060829     USD     430,184.25       20061215  
SARA LEE UNDERWEAR
  HKH682044     20060728     USD     385,076.16       20061215  
SARA LEE UNDERWEAR
  HKH682045     20060731     USD     453,635.36       20061215  
SARA LEE UNDERWEAR
  HKH682098     20060831     USD     43,777.44       20061217  
SARA LEE UNDERWEAR
  HKH682080     20060824     USD     185,232.99       20061219  
SARA LEE UNDERWEAR
  HKH682087     20060829     USD     525,769.14       20061225  
SARA LEE UNDERWEAR
  HKH682046     20060728     USD     535,161.51       20061230  
SARA LEE UNDERWEAR
  HKH682097     20060831     USD     219,281.71       20061230  
SARA LEE UNDERWEAR
  HKH682050     20060728     USD     453,635.36       20061230  
SARA LEE UNDERWEAR
  HKH682079     20060824     USD     162,862.50       20070109  
 
                          Beneficiary

Hanesbrands Inc.
        20070701     USD     5,000,000.00     National Union
Insurance

JP Morgan
                               
HBI JE Morgan
  628808     20070630     USD     700,000.00     Safety National
Casualty

HBI JE Morgan
  635146     20070631     USD     3,000,000.00     Bureau of Workers
Comp

National Textiles
  636174     20070110     USD     658,000.00     Royal Indemnity Co

National Textiles
  635186     20061130     USD     2,650,000.00     Travelers Indemnity
Co

 

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

 

EXHIBIT A-1
[FORM OF] REVOLVING NOTE

$                       [DATE]

     FOR VALUE RECEIVED, HANESBRANDS INC., a Maryland corporation (the
“Borrower”), promises to pay to the order of [Name of Lender] (the “Lender”) on
the Stated Maturity Date the principal sum of up to
[                                        ] ($[                    ]) or, if
less, the aggregate unpaid principal amount of all Revolving Loans shown on the
schedule attached hereto (and any continuation thereof) made (or continued) by
the Lender pursuant to that certain First Lien Credit Agreement, dated as of
September 5, 2006 (as amended, supplemented, amended and restated or otherwise
modified from time to time, the “Credit Agreement”), among the Borrower, the
Lenders, HSBC Bank USA, National Association, LaSalle Bank National Association
and Barclays Bank PLC, as the Co-Documentation Agents, Merrill Lynch Pierce,
Fenner & Smith Incorporated and Morgan Stanley Senior Funding, Inc., as the
Co-Syndication Agents, Citicorp USA, Inc., as the Administrative Agent,
Citibank, N.A., as the Collateral Agent, and Merrill Lynch Pierce, Fenner &
Smith Incorporated and Morgan Stanley Senior Funding, Inc., as the joint lead
arrangers and joint bookrunners (in such capacities, the “Lead Arrangers”).
Terms used in this Revolving Note, unless otherwise defined herein, have the
meanings provided in the Credit Agreement.
     The Borrower also promises to pay interest on the unpaid principal amount
hereof from time to time outstanding from the date hereof until maturity
(whether by acceleration or otherwise) and, after maturity, until paid, at the
rates per annum and on the dates specified in the Credit Agreement.
     Payments of both principal and interest are to be made pursuant to the
terms of the Credit Agreement.
     This Revolving Note is one of the Revolving Notes referred to in, and
evidences Indebtedness incurred under, the Credit Agreement, to which reference
is made for a description of the security for this Revolving Note and for a
statement of the terms and conditions on which the Borrower is permitted and
required to make prepayments and repayments of principal of the Indebtedness
evidenced by this Revolving Note and on which such Indebtedness may be declared
to be immediately due and payable.
     All parties hereto, to the extent permitted by applicable law, whether as
makers, endorsers or otherwise, severally waive presentment for payment, demand,
protest and notice of dishonor.
Revolving Note (First Lien)

 

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

 

     THIS REVOLVING NOTE HAS BEEN DELIVERED IN NEW YORK, NEW YORK AND SHALL BE
DEEMED TO BE A CONTRACT MADE UNDER AND GOVERNED BY THE INTERNAL LAWS OF THE
STATE OF NEW YORK (INCLUDING FOR SUCH PURPOSE SECTIONS 5-1401 AND 5-1402 OF THE
GENERAL OBLIGATIONS LAW OF THE STATE OF NEW YORK).

            HANESBRANDS INC.
      By:   _________________________________         Name:           Title:    
   

Revolving Note (First Lien)

-2-

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

 

REVOLVING LOANS AND PRINCIPAL PAYMENTS

                                                                             
Amount of             Amount of Principal     Unpaid Principal                  
  Loan Made             Repaid     Balance                     Alternate    
LIBO     Interest     Alternate     LIBO     Alternate     LIBO            
Notation   Date   Base Rate     Rate     Period     Base Rate     Rate     Base
Rate     Rate     Total     Made By  
 
                                                                       

Revolving Note (First Lien)

 

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

 

EXHIBIT A-2
[FORM OF] FIRST LIEN TERM A NOTE

      $                       [DATE]

     FOR VALUE RECEIVED, HANESBRANDS INC., a Maryland corporation (the
“Borrower”), promises to pay to the order of [NAME OF LENDER] (the “Lender”) on
the Stated Maturity Date the principal sum of                     DOLLARS
($                    ) or, if less, the aggregate unpaid principal amount of
all Term A Loans shown on the schedule attached hereto (and any continuation
thereof) made (or continued) by the Lender pursuant to that certain First Lien
Credit Agreement, dated as of September 5, 2006 (as amended, supplemented,
amended and restated or otherwise modified from time to time, the “Credit
Agreement”), among the Borrower, the Lenders, HSBC Bank USA, National
Association, LaSalle Bank National Association and Barclays Bank PLC, as the
Co-Documentation Agents, Merrill Lynch Pierce, Fenner & Smith Incorporated and
Morgan Stanley Senior Funding, Inc., as the Co-Syndication Agents, Citicorp USA,
Inc., as the Administrative Agent, Citibank, N.A., as the Collateral Agent, and
Merrill Lynch Pierce, Fenner & Smith Incorporated and Morgan Stanley Senior
Funding, Inc., as the joint lead arrangers and joint bookrunners (in such
capacities, the “Lead Arrangers”). Terms used in this First Lien Term A Note,
unless otherwise defined herein, have the meanings provided in the Credit
Agreement.
     The Borrower also promises to pay interest on the unpaid principal amount
hereof from time to time outstanding from the date hereof until maturity
(whether by acceleration or otherwise) and, after maturity, until paid, at the
rates per annum and on the dates specified in the Credit Agreement.
     Payments of both principal and interest are to be made pursuant to the
terms of the Credit Agreement.
     This First Lien Term A Note is one of the Term A Notes referred to in, and
evidences Indebtedness incurred under, the Credit Agreement, to which reference
is made for a description of the security for this First Lien Term A Note and
for a statement of the terms and conditions on which the Borrower is permitted
and required to make prepayments and repayments of principal of the Indebtedness
evidenced by this First Lien Term A Note and on which such Indebtedness may be
declared to be immediately due and payable.
     All parties hereto, to the extent permitted by applicable law, whether as
makers, endorsers, or otherwise, severally waive presentment for payment,
demand, protest and notice of dishonor.
Term A Note (First Lien)

 

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

 

     THIS FIRST LIEN TERM A NOTE HAS BEEN DELIVERED IN NEW YORK, NEW YORK AND
SHALL BE DEEMED TO BE A CONTRACT MADE UNDER AND GOVERNED BY THE INTERNAL LAWS OF
THE STATE OF NEW YORK (INCLUDING FOR SUCH PURPOSE SECTIONS 5-1401 AND 5-1402 OF
THE GENERAL OBLIGATIONS LAW OF THE STATE OF NEW YORK).

                  HANESBRANDS INC.    
 
           
 
  By        
 
     
 
Name:    
 
      Title:    

Term A Note (First Lien)

-2-

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TERM A LOANS AND PRINCIPAL PAYMENTS

                                                                             
Amount of Term A             Amount of Principal     Unpaid Principal          
          Loan Made             Repaid     Balance                     Alternate
    LIBO     Interest     Alternate     LIBO     Alternate     LIBO            
Notation   Date   Base Rate     Rate     Period     Base Rate     Rate     Base
Rate     Rate     Total     Made By  
 
                                                                       

Term A Note (First Lien)

 

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

 

EXHIBIT A-3
[FORM OF] FIRST LIEN TERM B NOTE

$                       [DATE]

     FOR VALUE RECEIVED, HANESBRANDS INC., a Maryland corporation (the
“Borrower”), promises to pay to the order of [NAME OF LENDER] (the “Lender”) on
the Stated Maturity Date the principal sum of                      DOLLARS
($                    ) or, if less, the aggregate unpaid principal amount of
all Term B Loans shown on the schedule attached hereto (and any continuation
thereof) made (or continued) by the Lender pursuant to that certain First Lien
Credit Agreement, dated as of September 5, 2006 (as amended, supplemented,
amended and restated or otherwise modified from time to time, the “Credit
Agreement”), among the Borrower, the Lenders, HSBC Bank USA, National
Association, LaSalle Bank National Association and Barclays Bank PLC, as the
Co-Documentation Agents, Merrill Lynch Pierce, Fenner & Smith Incorporated and
Morgan Stanley Senior Funding, Inc., as the Co-Syndication Agents, Citicorp USA,
Inc., as the Administrative Agent, Citibank, N.A., as the Collateral Agent, and
Merrill Lynch Pierce, Fenner & Smith Incorporated and Morgan Stanley Senior
Funding, Inc., as the joint lead arrangers and joint bookrunners (in such
capacities, the “Lead Arrangers”). Terms used in this First Lien Term B Note,
unless otherwise defined herein, have the meanings provided in the Credit
Agreement.
     The Borrower also promises to pay interest on the unpaid principal amount
hereof from time to time outstanding from the date hereof until maturity
(whether by acceleration or otherwise) and, after maturity, until paid, at the
rates per annum and on the dates specified in the Credit Agreement.
     Payments of both principal and interest are to be made pursuant to the
terms of the Credit Agreement.
     This First Lien Term B Note is one of the Term B Notes referred to in, and
evidences Indebtedness incurred under, the Credit Agreement, to which reference
is made for a description of the security for this First Lien Term B Note and
for a statement of the terms and conditions on which the Borrower is permitted
and required to make prepayments and repayments of principal of the Indebtedness
evidenced by this First Lien Term B Note and on which such Indebtedness may be
declared to be immediately due and payable.
     All parties hereto, to the extent permitted by applicable law, whether as
makers, endorsers, or otherwise, severally waive presentment for payment,
demand, protest and notice of dishonor.

 

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

 

     THIS FIRST LIEN TERM B NOTE HAS BEEN DELIVERED IN NEW YORK, NEW YORK AND
SHALL BE DEEMED TO BE A CONTRACT MADE UNDER AND GOVERNED BY THE INTERNAL LAWS OF
THE STATE OF NEW YORK (INCLUDING FOR SUCH PURPOSE SECTIONS 5-1401 AND 5-1402 OF
THE GENERAL OBLIGATIONS LAW OF THE STATE OF NEW YORK).

                  HANESBRANDS INC.    
 
           
 
  By        
 
     
 
Name:    
 
      Title:    

Term B Note (First Lien)

-2-

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

 

TERM B LOANS AND PRINCIPAL PAYMENTS

                                                                             
Amount of Term B             Amount of Principal     Unpaid Principal          
          Loan Made             Repaid     Balance                     Alternate
    LIBO     Interest     Alternate     LIBO     Alternate     LIBO            
Notation   Date   Base Rate     Rate     Period     Base Rate     Rate     Base
Rate     Rate     Total     Made By  
 
                                                                       

Term B Note (First Lien)

 

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

 

EXHIBIT A-4
[FORM OF] FIRST LIEN SWING LINE NOTE

$                       [DATE]

     FOR VALUE RECEIVED, the undersigned, HANESBRANDS INC., a Maryland
corporation (the “Borrower”), promises to pay to the order of [NAME OF LENDER]
(the “Lender”) on the Stated Maturity Date for Swing Line Loans the principal
sum of                      DOLLARS ($                    ) or, if less, the
aggregate unpaid principal amount of all Swing Line Loans made by the Lender
pursuant to the First Lien Credit Agreement, dated as of September 5, 2006 (as
amended, supplemented, amended and restated, or otherwise modified from time to
time, the “Credit Agreement”), among the Borrower, the Lenders, HSBC Bank USA,
National Association, LaSalle Bank National Association and Barclays Bank PLC,
as the Co-Documentation Agents, Merrill Lynch Pierce, Fenner & Smith
Incorporated and Morgan Stanley Senior Funding, Inc., as the Co-Syndication
Agents, Citicorp USA, Inc., as the Administrative Agent, Citibank, N.A., as the
Collateral Agent, and Merrill Lynch Pierce, Fenner & Smith Incorporated and
Morgan Stanley Senior Funding, Inc., as the joint lead arrangers and joint
bookrunners (in such capacities, the “Lead Arrangers”). Terms used in this Swing
Line Note, unless otherwise defined herein, have the meanings provided in the
Credit Agreement.
     The Borrower also promises to pay interest on the unpaid principal amount
hereof from time to time outstanding from the date hereof until maturity
(whether by acceleration or otherwise) and, after maturity, until paid, at the
rates per annum and on the dates specified in the Credit Agreement.
     Payments of both principal and interest are to be made pursuant to the
terms of the Credit Agreement.
     This Swing Line Note is the Swing Line Note referred to in, and evidences
Indebtedness incurred under, the Credit Agreement, to which reference is made
for a description of the security for this Swing Line Note and for a statement
of the terms and conditions on which the Borrower is permitted and required to
make prepayments and repayments of principal of the Indebtedness evidenced by
this Swing Line Note and on which such Indebtedness may be declared to be
immediately due and payable.
     All parties hereto, to the extent permitted by applicable law, whether as
makers, endorsers, or otherwise, severally waive presentment for payment,
demand, protest and notice of dishonor.
Swing Line Note (First Line)

 

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

 

     THIS SWING LINE NOTE HAS BEEN DELIVERED IN NEW YORK, NEW YORK AND SHALL BE
DEEMED TO BE A CONTRACT MADE UNDER AND GOVERNED BY THE INTERNAL LAWS OF THE
STATE OF NEW YORK.

                  HANESBRANDS INC.    
 
           
 
  By        
 
     
 
Name:    
 
      Title:    

Swing Line Note (First Line)

         

-2-

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

 

                                   

SWING LINE LOANS AND PRINCIPAL PAYMENTS

                                      Amount of Swing     Amount of Principal  
  Outstanding         Date   Line Loan     Payment     Principal Balance    
Notation Made By  
 
                               

Swing Line Note (First Line)

-3-

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

 

EXHIBIT B-1
[FORM OF] BORROWING REQUEST
Citicorp USA, Inc.,
  as Administrative Agent
2 Penns Way
Suite 100
New Castle, De 19720
Attention: Carin Seals
Fax: (302) 894-6076
Phone: (212) 994-0967
E-mail: carin.seals@citigroup.com
HANESBRANDS INC.
Ladies and Gentlemen:
     This Borrowing Request is delivered to you pursuant to Section 2.3 of the
First Lien Credit Agreement, dated as of September 5, 2006 (as amended,
supplemented, amended and restated or otherwise modified from time to time, the
“Credit Agreement”), among Hanesbrands Inc. (the “Borrower”), the Lenders, HSBC
Bank USA, National Association, LaSalle Bank National Association and Barclays
Bank PLC, as the Co-Documentation Agents, Merrill Lynch Pierce, Fenner & Smith
Incorporated and Morgan Stanley Senior Funding, Inc., as the Co-Syndication
Agents, Citicorp USA, Inc., as the Administrative Agent, Citibank, N.A., as the
Collateral Agent, and Merrill Lynch Pierce, Fenner & Smith Incorporated and
Morgan Stanley Senior Funding, Inc., as the joint lead arrangers and joint
bookrunners (in such capacities, the “Lead Arrangers”). Terms used herein,
unless otherwise defined herein, have the meanings provided in the Credit
Agreement.
     The Borrower hereby requests that a [Revolving Loan] [Term A Loan] [Term B
Loan] [Swing Line Loan] be made in the aggregate principal amount of
[$                    ] [€                    ] on                      ___,
___as a [Base Rate Loan] [LIBO Rate Loan having an Interest Period of ___
[months] [weeks]].
     The Borrower hereby acknowledges that, pursuant to Section 5.2.2 of the
Credit Agreement, each of the delivery of this Borrowing Request and the
acceptance by the Borrower of the proceeds of the Loans requested hereby
constitutes a representation and warranty by the Borrower that, on the date of
the making of such Loans, and both before and after giving effect thereto, all
statements set forth in Section 5.2.1 of the Credit Agreement are true and
correct.
     The Borrower agrees that if prior to the time of the Borrowing requested
hereby any matter certified to herein by it will not be true and correct to the
extent set forth in Section 5.2.1 of the Credit Agreement at such time as if
then made, it will promptly so notify the Administrative Agent. Except to the
extent, if any, that prior to the time of the Borrowing
Borrowing Request (First Lien)

 

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

 

requested hereby the Administrative Agent shall receive written notice to the
contrary from the Borrower, each matter certified to herein shall be deemed once
again to be certified as true and correct to the extent set forth in
Section 5.2.1 of the Credit Agreement at the date of such Borrowing as if then
made.
     Please wire transfer the proceeds of the Borrowing to the accounts of the
following persons at the financial institutions indicated respectively:

                              Person to be Paid     Name, Address, etc.   Amount
to be Transferred     Name       Account No.       Of Transferee Lender  
$                    
                                                         
                                          
 
                                                              
 
                  Attention:                     
 
                       
$                    
                                                         
                                          
 
                                                              
 
                  Attention:                     
 
                       
$                    
                                                         
                                          
 
                                                              
 
                  Attention:                     
 
                       
Balance of such proceeds
  The Borrower                                                       
 
                                                              
 
              Attention:                     

Borrowing Request (First Lien)

-2-

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

 

     IN WITNESS WHEREOF, the Borrower has caused this Borrowing Request to be
executed and delivered, and the certifications and warranties contained herein
to be made, by its duly Authorized Officer, solely in such capacity and not as
an individual, this ___ day of                     , ___.

                  HANESBRANDS INC.
 
           
 
  By        
 
           
 
      Name:    
 
      Title:    

Borrowing Request (First Lien)

 

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

 

EXHIBIT B-2
[FORM OF] ISSUANCE REQUEST
Citicorp USA, Inc.,
  as the Administrative Agent
2 Penns Way
Suite 100
New Castle, De 19720
Attention: Carin Seals
Fax: (302) 894-6076
Phone: (212) 994-0967
E-mail: carin.seals@citigroup.com
[HSBC,
  as the Issuer
Address
Attention:
Fax:
Phone:
Email:]
[NAME OF ANY ADDITIONAL ISSUER,
as an Issuer
Address
Attention:
Fax:
Phone:
Email:]
HANESBRANDS INC.
Ladies and Gentlemen:
     This Issuance Request is delivered to you pursuant to Section 2.6 of that
certain First Lien Credit Agreement, dated as of September 5, 2006 (as amended,
supplemented, amended and restated or otherwise modified from time to time, the
“Credit Agreement”), among Hanesbrands Inc. (the “Borrower”), the Lenders, HSBC
Bank USA, National Association, LaSalle Bank National Association and Barclays
Bank PLC, as the Co-Documentation Agents, Merrill Lynch Pierce, Fenner & Smith
Incorporated and Morgan Stanley Senior Funding, Inc., as the Co-Syndication
Agents, Citicorp USA, Inc., as the Administrative Agent, Citibank, N.A., as the
Collateral Agent, and Merrill Lynch Pierce, Fenner & Smith Incorporated and
Morgan
Issuance Request

 

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

 

Stanley Senior Funding, Inc., as the joint lead arrangers and joint bookrunners
(in such capacities, the “Lead Arrangers”). Terms used herein, unless otherwise
defined herein, have the meanings provided in the Credit Agreement.
     The Borrower hereby requests that on                      ___, ___ (the
“Date of Issuance”)1 [HSBC Bank USA, National Association] (the “Issuer”) [issue
a [Standby] [Commercial] Letter of Credit in the initial Stated Amount of
$                     with a Stated Expiry Date (as defined therein) of
                     ___, ___] [extend the Stated Expiry Date2, 3 (as defined
under Letter of Credit No. ___, issued on                      ___, ___, in the
initial Stated Amount of $                    ) to a revised Stated Expiry Date
(as defined therein) of                      ___, ___].
     The beneficiary of the requested Letter of Credit will be
                                        , and such Letter of Credit will be in
support of                                         .
     The Borrower hereby acknowledges that, pursuant to Section 5.2.2 of the
Credit Agreement, each of the delivery of this Issuance Request and the
acceptance by the Borrower of the [issuance] [extension] of the Letter of Credit
requested hereby constitutes a representation and warranty by the Borrower that,
on the date of such [issuance] [extension], and both before and after giving
effect thereto, all statements set forth in Section 5.2.1 of the Credit
Agreement are true and correct in all material respects (unless stated to relate
solely to an earlier date, in which case such representations and warranties
shall be true and correct in all material respects as of such earlier date).
     The Borrower agrees that if prior to the time of the [issuance] [extension]
of the Letter of Credit requested hereby any matter certified to herein by it
will not be true and correct in all material respects at such time as if then
made, it will promptly so notify the Administrative Agent. Except to the extent,
if any, that prior to the time of the [issuance] [extension] of the Letter of
Credit requested hereby the Administrative Agent shall receive written notice to
the contrary from the Borrower, each matter certified to herein shall be deemed
once again to be certified as true and correct in all material respects at the
date of such [issuance] [extension] as if then made.
 

1   Insert date of Issuance Request which shall be on or before 10:00 a.m. on a
Business Day, not less than three nor more than ten Business Days’ notice, in
the case of an initial issuance of a Letter of Credit and not less than three
Business Days’ prior notice, in the case of a request for the extension of the
Stated Expiry Date of a Standby Letter of Credit (in each case, unless a shorter
notice period is agreed to by the relevant Issuer, in its sole discretion)   2  
Each Standby Letter of Credit shall by its terms be stated to expire no later
than the earlier to occur of (i) five Business Days prior to the Revolving Loan
Commitment Termination Date or (ii) unless otherwise agreed to by the Issuer, in
its sole discretion, one year from the date of issuance (provided that each
Standby Letter of Credit may, with the consent of the Issuer in its sole
discretion, provide for automatic renewals for one year periods (which in no
event shall extend beyond the Revolving Loan Commitment Termination Date).   3  
Each Commercial Letter of Credit shall by its terms be stated to expire on a
date no later than the earlier to occur of (i) five Business Days prior to the
Revolving Loan Commitment Termination Date or (ii) unless otherwise agreed to by
the Issuer, in its sole discretion, 180 days from the date of its issuance.

Issuance Request

-2-

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

 

     IN WITNESS WHEREOF, the Borrower has caused this Issuance Request to be
executed and delivered, and the certifications and warranties contained herein
to be made, by its duly Authorized Officer, solely in such capacity and not as
an individual, this ___ day of                     , ___.

                  HANESBRANDS INC.
 
           
 
  By        
 
           
 
      Name:    
 
      Title:    

Issuance Request

-3-

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

 

EXHIBIT C
CONTINUATION/CONVERSION NOTICE
Citicorp USA, Inc.,
  as Administrative Agent
2 Penns Way
Suite 100
New Castle, DE 19720
Attention: Carin Seals
Fax: (302) 894-6076
Phone: (212) 994-0967
E-mail: carin.seals@citigroup.com
HANESBRANDS INC.
Ladies and Gentlemen:
     This Continuation/Conversion Notice is delivered to you pursuant to
Section 2.4 of the First Lien Credit Agreement, dated as of September 5, 2006
(as amended, supplemented, amended and restated or otherwise modified from time
to time, the “Credit Agreement”), among Hanesbrands Inc., a Maryland corporation
(the “Borrower”), the Lenders, HSBC Bank USA, National Association, LaSalle Bank
National Association and Barclays Bank PLC, as the Co-Documentation Agents,
Merrill Lynch Pierce, Fenner & Smith Incorporated and Morgan Stanley Senior
Funding, Inc., as the Co-Syndication Agents, Citicorp USA, Inc., as the
Administrative Agent, Citibank, N.A., as the Collateral Agent, and Merrill Lynch
Pierce, Fenner & Smith Incorporated and Morgan Stanley Senior Funding, Inc., as
the joint lead arrangers and joint bookrunners (in such capacities, the “Lead
Arrangers”). Terms used herein, unless otherwise defined herein, have the
meanings provided in the Credit Agreement.
     The Borrower hereby requests that on                      ___, ___1,
     (1) $                     2 of the presently outstanding principal amount
of the [Revolving Loans] [Term A Loans] [Term B Loans] originally made on
                     ___, ___, presently being maintained as [Base Rate Loans]
[LIBO Rate Loans],
 

1   Insert date of Continuation/Conversion Notice which shall be on or before
10:00 a.m. on a Business Day (i) and not less than three nor more than five
Business Days’ notice, (A) to convert any Base Rate Loan into one or more LIBO
Rate Loans denominated in Dollars or (B) before the last day of the then current
Interest Period with respect thereto, to continue any LIBO Rate Loan denominated
in Dollars as a LIBO Rate Loan so denominated; and (ii) on not less than five
nor more than ten Business Days’ notice before the last day of the then current
Interest Period with respect thereto, to convert or continue any LIBO Rate Loan
denominated in Euros as a LIBO Rate Loan denominated in Euros; provided that in
the absence of prior notice as required above (which notice may be delivered
telephonically followed by written confirmation within 24 hours thereafter by
delivery of a Continuation/Conversion Notice), with respect to any LIBO Rate
Loan denominated in Dollars at least three Business Days (or, with respect to
any LIBO Rate Loan denominated in Euros, at least five Business Days) before the
last day of the then current Interest Period with respect thereto, such LIBO
Rate Loan shall, on such last day, automatically convert to a Base Rate Loan.  
2   Minimum of $1,000,000 and integral multiples of $1,000,000.

Continuation/Conversion Notice (First Lien)

 

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

 

     (2) be [converted into] [continued as],
     (3) [LIBO Rate Loans having an Interest Period of ___ [ weeks] [months]]3
[Base Rate Loans].
     [The undersigned hereby certifies that no Event of Default has occurred and
is continuing on the date of the proposed [conversion] [continuation]]4
 

3   Insert appropriate interest rate option and, if applicable, the number of
weeks (one or two) if available, or months (one, two, three or six, or if
available nine or twelve) with respect to LIBO Rate Loans.   4   Insert this
sentence only in the event of a conversion from a Base Rate Loan to a LIBO Rate
Loan or a continuation of a LIBO Rate Loan.

Continuation/Conversion Notice (First Lien)

-2-

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

 

     IN WITNESS WHEREOF, the Borrower has caused this Continuation/Conversion
Notice to be executed and delivered by its duly Authorized Officer, solely in
such capacity and not as an individual, this ___ day of                     ,
___.

                  HANESBRANDS INC.
 
           
 
  By        
 
           
 
      Name:    
 
      Title:    

Continuation/Conversion Notice (First Lien)

-3-

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

 

EXHIBIT D
[FORM OF] LENDER ASSIGNMENT AGREEMENT
                     ___, _____

To:   HANESBRANDS INC.,
as the Borrower
1000 East Hanes Mill Rd
Winston Salem, NC 27105
Attn: General Counsel

  CITICORP USA, INC.,
as the Administrative Agent
2 Penns Way
Suite 100
New Castle, De 19720
Attention: Carin Seals
Fax: (302) 894-6076
Phone: (212) 994-0967
E-mail: carin.seals@citigroup.com

HANESBRANDS INC.
Gentlemen and Ladies:
     This Lender Assignment Agreement (this “Assignment and Acceptance”) 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, receipt of a
copy of which is hereby acknowledged by the Assignee. The Standard Terms and
Conditions set forth in Annex 1 attached hereto (the “Standard Terms and
Conditions”) are hereby agreed to be incorporated herein by reference and made a
part of this Assignment and Acceptance.
     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 Administrative Agent (as defined below) as contemplated below (i) all of the
Assignor’s rights, benefits, obligations, liabilities and indemnities in its
capacity as a Lender under (and in connection with) the Credit Agreement and any
other Loan Documents 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 any Letter of Credit Outstandings and Swing Line Loans) and (ii) to
the extent permitted to be assigned under applicable law, all claims, suits,
causes of
Lender Assignment Agreement (First Lien)

1

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

 

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, the other Loan Documents 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 Acceptance,
without representation or warranty by the Assignor.
     This Assignment and Acceptance shall be effective as of the Effective Date
[upon the written consent of the Administrative Agent]1 [, each Issuer, the
Swing Line Lender]2 [and the Borrower (as defined below); provided that the
Borrower shall be deemed to have given its consent seven Business Days after the
date notice thereof has been delivered by the Assignor (through the
Administrative Agent) to the Borrower, unless such consent is expressly refused
by the Borrower prior to such seventh Business Day]3 being subscribed in the
space indicated below.

         
1.
  Assignor:    
 
       
 
       
2.
  Assignee:    
 
       
 
      [and is an Affiliate/Approved Fund of [identify Lender]4]
 
       
3.
  Borrower:   HANESBRANDS INC. (the “Borrower”)
 
       
4.
  Administrative Agent:   CITICORP USA, INC., as the administrative agent under
the Credit Agreement (the “Administrative Agent”)
 
       
5.
  Credit Agreement:   The First Lien Credit Agreement, dated as of September 5,
2006 (as amended, supplemented, amended and restated or otherwise modified from
time to time, the “Credit Agreement”), among the Borrower, the Lenders, HSBC
Bank USA, National Association, LaSalle Bank National Association and Barclays
Bank PLC, as the Co-Documentation Agents, Merrill Lynch Pierce, Fenner & Smith
Incorporated and Morgan Stanley Senior Funding, Inc., as the Co-Syndication
Agents, Citicorp USA, Inc., as the Administrative Agent, Citibank, N.A., as the
Collateral Agent, and Merrill Lynch Pierce, Fenner & Smith Incorporated and
Morgan Stanley

 

1   Administrative Agent consent required for assignments (i) to an Eligible
Assignee that is not a Lender, an Approved Fund or an Affiliate of a Lender and
(ii) pursuant to clause (a)(i) of Section 10.11 of the Credit Agreement.   2  
Consent of each Issuer and the Swing Line Lender is required for assignments of
Revolving Loan Commitments to an Eligible Assignee that is not a Lender, an
Approved Fund or an Affiliate of a Lender.   3   Borrower consent required
(i) pursuant to clause (a)(i) of Section 10.11 of the Credit Agreement and
(ii) so long as no Event of Default has occurred and is continuing, for
assignments of Revolving Loan Commitments, Revolving Loans and Term A Loans to
an Eligible Assignee that is not a Lender, an Approved Fund or an Affiliate of a
Lender.   4   Select as applicable.

Lender Assignment Agreement (First Lien)

2

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

 

         

    Senior Funding, Inc., as the joint lead arrangers and joint
bookrunners (in such capacities, the “Lead Arrangers”).

6.   Assigned Interest:

                              Aggregate Amount of     Amount of     Percentage  
    Commitment/Loans     Commitment/Loans     Assigned of   Facility Assigned  
for all Lenders     Assigned     Commitment/Loans  
[Revolving Loan Commitment/Revolving Loans]
  $       $         %  
[Term A Loan]
  $       $         %  
[Term B Loan]
  $       $         %  

      Effective Date:   [MONTH] ___, 20___

Lender Assignment Agreement (First Lien)

3

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     The terms set forth in this Assignment and Acceptance are hereby agreed to
as of the Effective Date:

            ASSIGNOR
[NAME OF ASSIGNOR]
      By:           Name:           Title:           ASSIGNEE
[NAME OF ASSIGNEE]
      By:           Name:           Title:        

Lender Assignment Agreement (First Lien)

4

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[Consented to and] Accepted:
CITICORP USA, INC.,
as the Administrative Agent [and the Swing Line Lender]

         
By:
       
 
 
 
Name:    
 
  Title:    

[Consented to:
HANESBRANDS INC.,
as the Borrower

         
By:
       
 
 
 
Name:    
 
  Title:]    

[Consented to:
HSBC Bank USA, National Association,
as an Issuer

         
By:
       
 
 
 
Name:    
 
  Title:    

[NAME OF ANY ADDITIONAL ISSUER],
as an Issuer

         
By:
       
 
 
 
Name:    
 
  Title:]    

Lender Assignment Agreement (First Lien)

5

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ANNEX 1
STANDARD TERMS AND CONDITIONS FOR
ASSIGNMENT AND ACCEPTANCE
          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 Acceptance and to consummate the
transactions contemplated hereby; and (b) except as provided in clause
(a) above, 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 or 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 or 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 Acceptance and to consummate the transactions
contemplated hereby and to become a Lender under the Credit Agreement, (ii) it
is 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 has received a copy of the
Credit Agreement, together with copies of the most recent financial statements
delivered pursuant to Section 5.1.6 or 7.1.1 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 Acceptance 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 (v) if it is a Non-U.S. Lender, attached to this
Assignment and Acceptance 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 Collateral Agent, the Assignor or any
other Lender, and based on such documents and information as it shall deem
appropriate at the time, continue to make its own credit decisions in taking or
not taking action under 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
Lender Assignment Agreement (First Lien)

6

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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 Acceptance shall be binding
upon, and inure to the benefit of, the parties hereto and their respective
successors and assigns. This Assignment and Acceptance 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 Acceptance
by telecopy or facsimile (or other electronic) transmission shall be effective
as delivery of a manually executed counterpart of this Assignment and
Acceptance. This Assignment and Acceptance shall be deemed to be a contract made
under, governed by, and construed in accordance with, the laws of the State of
New York (including for such purposes Sections 5-1401 and 5-1402 of the General
Obligations Law of the State of New York) without regard to conflicts of laws
principles.
Lender Assignment Agreement (First Lien)

7

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EXHIBIT E
COMPLIANCE CERTIFICATE (FIRST LIEN)
HANESBRANDS INC.
     This Compliance Certificate is delivered pursuant to clause (c) of
Section 7.1.1 of the First Lien Credit Agreement, dated as of September 5, 2006
(as amended, supplemented, amended and restated or otherwise modified from time
to time, the “Credit Agreement”), among Hanesbrands Inc. (the “Borrower”), the
Lenders, HSBC Bank USA, National Association, LaSalle Bank National Association
and Barclays Bank PLC, as the Co-Documentation Agents, Merrill Lynch, Pierce,
Fenner & Smith Incorporated and Morgan Stanley Senior Funding, Inc., as the
Co-Syndication Agents, Citicorp USA, Inc., as the Administrative Agent,
Citibank, N.A., as the Collateral Agent, and Merrill Lynch, Pierce, Fenner &
Smith Incorporated and Morgan Stanley Senior Funding, Inc., as the joint lead
arrangers and joint bookrunners (in such capacities, the “Lead Arrangers”).
Terms used herein that are defined in the Credit Agreement, unless otherwise
defined herein, have the meanings provided (or incorporated by reference) in the
Credit Agreement.
     The Borrower hereby certifies, represents and warrants as follows in
respect of the period (the “Computation Period”) commencing on
                     ___, ___ and ending on                      ___, ___ (such
latter date being the “Computation Date”) and with respect to the Computation
Date:
          1. Defaults. As of the Computation Date, no Default had occurred and
was continuing. 1
          2. Financial Covenants.
               a. Leverage Ratio. The Leverage Ratio on the Computation Date was
                    , as computed on Attachment 1 hereto. The maximum Leverage
Ratio permitted pursuant to clause (a) of Section 7.2.4 of the Credit Agreement
on the Computation Date was                     .
               b. Interest Coverage Ratio. The Interest Coverage Ratio for the
Computation Period was                     , as computed on Attachment 2 hereto.
The minimum Interest Coverage Ratio permitted pursuant to clause (b) of
Section 7.2.4 of the Credit Agreement for the Computation Period was
                    .
          3. 2[Excess Cash Flow: The Excess Cash Flow was $                    ,
as computed on Attachment 3 hereto.] Such amount multiplied by the Applicable
Percentage (which is ___% based on the Leverage Ratio set forth above) is
$                    . Such amount minus the
 

1   If a Default has occurred, specify the details of such default and the
action that the Borrower or other Obligor has taken or proposes to take with
respect thereto.   2   Use in the case of a Compliance Certificate delivered
concurrently with the financial information pursuant to clause (b) of
Section 7.1.1 of the Credit Agreement if applicable.

1

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aggregate amount of all voluntary prepayments of Loans (but including Revolving
Loans and Swing Line Loans only to the extent there was a corresponding
reduction of the Revolving Loan Commitment Amount pursuant to Section 2.2.1 of
the Credit Agreement) made during the Computation Period (which was
$                    ) is equal to $                    . As a result, 3[we are
required to make a mandatory prepayment in such amount] 4[we are not required to
make a mandatory prepayment of Excess Cash Flow]
          4. Subsidiaries: Except as set forth below, no Subsidiary has been
formed or acquired since the delivery of the last Compliance Certificate. The
formation and/or acquisition of such Subsidiary was in compliance with
Section 7.1.8 of the Credit Agreement.
     [Insert names of any new entities.]
          5. Neither the Borrower nor any Obligor has changed its legal name or
jurisdiction of organization, during the Computation Period, except as indicated
on Attachment 4 hereto.
 

3   Use if amount is positive.   4   Use if amount is zero or less.

2

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     IN WITNESS WHEREOF, the Borrower has caused this Compliance Certificate to
be executed and delivered, and the certification and warranties contained herein
to be made, by the treasurer, chief financial or accounting Authorized Officer
of the Borrower, solely in such capacity and not as an individual, as of ___,
200_.

                  HANESBRANDS INC.
 
           
 
  By        
 
           
 
      Name:    
 
      Title:    

3

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Attachment 1
(to __/__/__ Compliance
Certificate)
LEVERAGE RATIO
on ___________
(the “Computation Date”)
Leverage Ratio:

              1.   Total Debt: on the Computation Date, in each case exclusive
of intercompany Indebtedness between the Borrower and its Subsidiaries and any
Contingent Liability in respect of any of the following, the outstanding
principal amount of all Indebtedness of the Borrower and its Subsidiaries (other
than a Receivables Subsidiary), comprised of:    
 
           
 
  (a)   all obligations of such Person for borrowed money or advances and all
obligations of such Person evidenced by bonds, debentures, notes or similar
instruments1   $                    
 
           
 
  (b)   all monetary obligations, contingent or otherwise, relative to the face
amount of all letters of credit, whether or not drawn, and banker’s acceptances
issued for the account of such Person2   $                    
 
           
 
  (c)   all Capitalized Lease Liabilities of such Person   $                    
 
           
 
  (d)   monetary obligations arising under Synthetic Leases  
$                    
 
           
 
  (e)   TOTAL DEBT: The sum of Item 1(a) through 1(d)   $                    
 
            2.   Net Income (the aggregate of all amounts which would be
included as net income on the consolidated financial statements of the Borrower
and its Subsidiaries for the Computation Period)3   $                    
 
            3.   to the extent deducted in determining Net Income, amounts    

 

1   In the case of the Loans, this amount shall be deemed to equal the Dollar
Equivalent (determined as of the most recent Revaluation Date) for any Loans
denominated in Euros.   2   In the case of Letter of Credit Outstandings, this
amount shall be deemed to equal the Dollar Equivalent (determined as of the most
recent Revaluation Date) for any Letter of Credit Outstandings denominated in
Euros.   3   The calculation of Net Income shall not include any net income of
any Foreign Supply Chain Entity, except to the extent cash is distributed by
such Foreign Supply Chain Entity during such period to the Borrower or any other
Subsidiary as a dividend or other distribution.

1

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

 

         
 
  attributable to amortization (including amortization of goodwill and other
intangible assets)   $                    
 
       
4.
  to the extent deducted in determining Net Income, Federal, state, local and
foreign income withholding, franchise, state single business unitary and similar
Tax expense   $                    
 
       
5.
  to the extent deducted in determining Net Income, Interest Expense (the
aggregate interest expense (both, without duplication, when accrued or paid and
net of interest income paid during such period to the Borrower and its
Subsidiaries) of the Borrower and its Subsidiaries for such applicable period,
including the portion of any payments made in respect of Capitalized Lease
Liabilities allocable to interest expense)   $                    
 
       
6.
  to the extent deducted in determining Net Income, depreciation of assets  
$                    
 
       
7.
  to the extent deducted in determining Net Income, all non-cash charges,
including all non-cash charges associated with announced restructurings, whether
announced previously or in the future   $                    
 
       
8.
  to the extent deducted in determining Net Income, net cash charges associated
with or related to any contemplated restructurings in an aggregate amount not to
exceed, in any Fiscal Year, the Permitted Cash Restructuring Charge4 Amount for
such Fiscal Year   $                    
 
       
9.
  to the extent deducted in determining Net Income, net cash restructuring
charges associated with or related to the Spin-Off in an aggregate amount not to
exceed, in any Fiscal Year, the Permitted Cash Spin-Off Charge Amount for such
Fiscal Year5   $                    
 
       
10.
  to the extent deducted in determining Net Income, all amounts in respect of
extraordinary losses   $                    
 
       
11.
  to the extent deducted in determining Net Income, non-cash compensation
expense, or other non-cash expenses or charges, arising from the sale of stock,
the granting of stock options, the granting of stock appreciation rights and
similar arrangements (including any repricing, amendment, modification,
substitution or change of any such stock, stock option, stock appreciation
rights or similar arrangements)   $                    

 

4   The Permitted Cash Restructuring Charge Amount shall be $120,000,000 in the
aggregate for the Fiscal Year 2006 and all Fiscal Years ending after the Closing
Date.   5   The Permitted Cash Spin-Off Charge Amount for the Fiscal Year 2006
shall be $20,000,000 and for the Fiscal Year 2007 shall be $55,000,000.

2

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

 

         
12.
  to the extent included in determining Net Income, any financial advisory fees,
accounting fees, legal fees and other similar advisory and consulting fees, cash
charges in respect of strategic market reviews, management bonuses and early
retirement of Indebtedness, and related out-of-pocket expenses incurred by the
Borrower or any of its Subsidiaries as a result of the Transaction, including
fees and expenses in connection with the issuance, redemption or exchange of the
Bridge Loans, all determined in accordance with GAAP   $                    
 
       
13.
  to the extent included in determining Net Income, non-cash or unrealized
losses on agreements with respect to Hedging Obligations   $                    
 
       
14.
  to the extent included in determining Net Income and to the extent
non-recurring and not capitalized, any financial advisory fees, accounting fees,
legal fees and similar advisory and consulting fees and related costs and
expenses of the Borrower and its Subsidiaries incurred as a result of Permitted
Acquisitions, Investments, Dispositions permitted under the Credit Agreement and
the issuance of Capital Securities or Indebtedness permitted under the Credit
Agreement, all determined in accordance with GAAP and in each case eliminating
any increase or decrease in income resulting from non-cash accounting
adjustments made in connection with the related Permitted Acquisition or
Dispositions   $                    
 
       
15.
  to the extent included in determining Net Income, and to the extent the
related loss in not added back pursuant to Item 21, all proceeds of business
interruption insurance policies   $                    
 
       
16.
  to the extent included in determining Net Income, expenses incurred by the
Borrower or any Subsidiary to the extent reimbursed in cash by a third party  
$                    
 
       
17.
  to the extent included in determining Net Income, extraordinary, unusual or
non-recurring cash charges not to exceed $10,000,000 in any Fiscal Year  
$                    
 
       
18.
  to the extent included in determining Net Income, all amounts in respect of
extraordinary gains or extraordinary losses   $                    
 
       
19.
  to the extent included in determining Net Income, non-cash gains on agreements
with respect to Hedging Obligations   $                    
 
       
20.
  to the extent included in determining Net Income, reversals (in whole or in
part) of any restructuring charges previously treated as Non-Cash Restructuring
Charges in any prior period   $                    

3

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21.
  to the extent included in determining Net Income, non-cash items increasing
such Net Income for such period, other than (A) the accrual of revenue
consistent with past practice and (B) the reversal in such period of an accrual
of, or cash reserve for, cash expenses in a prior period, to the extent such
accrual or reserve did not increase EBITDA in a prior period.  
$                    
 
       
22.
  EBITDA6: The sum of Items 2 through 17 minus Items 18 through 21  
$                    
 
       
23.
  LEVERAGE RATIO: ratio of Item 1 to Item 22   :1

 

6   For purposes of calculating the Leverage Ratio with respect to the four
consecutive Fiscal Quarter period ending (i) nearest to December 31, 2006,
EBITDA shall be actual EBITDA for the Fiscal Quarter ending nearest to
December 31, 2006 multiplied by four; (ii) nearest to March 31, 2007, EBITDA
shall be actual EBITDA for the two Fiscal Quarter period ending nearest to
March 31, 2007 multiplied by two; and (iii) nearest to June 30, 2007, EBITDA
shall be actual EBITDA for the three Fiscal Quarter period ending nearest to
June 30, 2007 multiplied by one and one-third.

4

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Attachment 2
(to __/__/__ Compliance
Certificate)
INTEREST COVERAGE RATIO
on ___________
(the “Computation Date”)
Interest Coverage Ratio:

         
1.
  EBITDA (see Item 22 of Attachment 1)   $                    
 
       
2.
  Interest Expense of the Borrower and its Subsidiaries (see Item 5 of
Attachment 1)1   $                    
 
       
3.
  INTEREST COVERAGE RATIO: ratio of Item 1 to Item 2   :1

 

1   For purposes of calculating Interest Expense with respect to the calculation
of the Interest Coverage Ratio with respect to the four consecutive Fiscal
Quarter period ending (i) nearest to December 31, 2006, Interest Expense shall
be actual Interest Expense for the Fiscal Quarter ending nearest to December 31,
2006 multiplied by four; (ii) nearest to March 31, 2007, Interest Expense shall
be actual Interest Expense for the two Fiscal Quarter period ending nearest to
March 31, 2007 multiplied by two; and (iii) nearest to June 30, 2007, Interest
Expense shall be actual Interest Expense for the three Fiscal Quarter period
ending nearest to June 30, 2007 multiplied by one and one-third.

 

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

 

Attachment 3
(to __/__/__ Compliance
Certificate)
EXCESS CASH FLOW1
on the Computation Date

         
1. EBITDA (see Item 22 of Attachment 1)
  $                       
 
       
2. Interest Expense actually paid in cash by the Borrower and its Subsidiaries
  $                       
 
       
3. scheduled principal repayments with respect to the permanent reduction of
Indebtedness, to the extent actually made and permitted to be made under the
Credit Agreement
  $                       
 
       
4. all Federal, state, local and foreign income withholding, franchise, state
single business unitary and similar Taxes actually paid in cash or payable (only
to the extent related to Taxes associated with such Fiscal Year) by the Borrower
and its Subsidiaries
  $                       
 
       
5. Capital Expenditures to the extent (x) actually made by the Borrower and its
Subsidiaries in such Fiscal Year or (y) committed to be made by the Borrower and
its Subsidiaries and that are permitted to be carried forward to the next
succeeding Fiscal Year pursuant to Section 7.2.7 of the Credit Agreement2
  $                       
 
       
6. the portion of the purchase price paid in cash with respect to Permitted
Acquisitions to the extent such Permitted Acquisition was made in connection
with the Borrower’s offshore migration of its supply chain
  $                       
 
       
7. cash Investments permitted to be made in Foreign Supply Chain Entities
  $                       
 
       
8. to the extent permitted to be included in the calculation of EBITDA for such
Fiscal Year, the amount of Cash Restructuring Charges and Cash Spin-Off Charges
actually so included in such calculation
  $                       
 
       
9. without duplication to any amounts deducted in preceding Item 2
       

 

1   Use in the case of a Compliance Certificate delivered concurrently with the
financial information pursuant to clause (b) of Section 7.1.1 of the Credit
Agreement.   2   The amounts deducted from Excess Cash Flow pursuant to clause
(y) of Item 5 shall not thereafter be deducted in the determination of Excess
Cash Flow for the Fiscal Year during which such payments were actually made.

 

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

 

         
through Item 8, all items added back to EBITDA pursuant to clause (b) of the
definition of EBITDA in the Credit Agreement that represent amounts actually
paid in cash
  $                       
 
       
10. The sum of Items 2 through 9
  $                       
 
       
11. EXCESS CASH FLOW: Item 1 less Item 10
  $                       

2

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Attachment 4
(to __/__/__ Compliance
Certificate)
CHANGE OF LEGAL NAME OR JURISDICTION OF INCORPORATION

              New Legal Name or Jurisdiction of   Name of Borrower or Other
Obligor   Incorporation  
 
       
 
     
 
       
 
     
 
       
 
     

 

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EXHIBIT F
GUARANTY
     This GUARANTY (as amended, supplemented, amended and restated or otherwise
modified from time to time, this “Guaranty”), dated as of September 5, 2006, is
made by HANESBRANDS INC., a Maryland corporation (the “Borrower”) and each U.S.
Subsidiary of the Borrower, from time to time party to this Guaranty (each
individually, a “Subsidiary Guarantor” and, together with the Borrower, each
individually, a “Guarantor” and collectively, the “Guarantors”), in favor of
CITICORP USA, INC., as administrative agent (together with its successor(s)
thereto in such capacity, the “Administrative Agent”) for each of the Secured
Parties (capitalized terms used herein have the meanings set forth in or
incorporated by reference in Article I).
W I T N E S S E T H:
     WHEREAS, pursuant to a First Lien Credit Agreement, dated as of
September 5, 2006 (as amended, supplemented, amended and restated or otherwise
modified from time to time, the “Credit Agreement”), among the Borrower, the
Lenders, HSBC Bank USA, National Association, LaSalle Bank National Association
and Barclays Bank PLC, as the Co-Documentation Agents, Merrill Lynch Pierce,
Fenner & Smith Incorporated and Morgan Stanley Senior Funding, Inc., as the
Co-Syndication Agents, Citicorp USA, Inc., as the Administrative Agent,
Citibank, N.A., as the Collateral Agent, and Merrill Lynch Pierce, Fenner &
Smith Incorporated and Morgan Stanley Senior Funding, Inc., as the joint lead
arrangers and joint bookrunners (in such capacities, the “Lead Arrangers”), the
Lenders and Issuers have extended Commitments to make Credit Extensions to the
Borrower; and
     WHEREAS, as a condition precedent to the making of the Credit Extensions
under the Credit Agreement, each Guarantor is required to execute and deliver
this Guaranty;
     NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, each Guarantor agrees, for the
benefit of each Secured Party, as follows:
ARTICLE I
DEFINITIONS
     SECTION 1.1. Certain Terms. The following terms (whether or not
underscored) when used in this Guaranty, including its preamble and recitals,
shall have the following meanings (such definitions to be equally applicable to
the singular and plural forms thereof):
     “Administrative Agent” is defined in the preamble.
     “Borrower” is defined in the preamble.
     “Credit Agreement” is defined in the first recital.
Guaranty (First Lien)

 

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Guaranty (First Lien)
     “Guarantor” and “Guarantors” are defined in the preamble.
     “Guaranty” is defined in the preamble.
     “Non-USD Currency” means a currency other than U.S. Dollars.
     “Secured Obligations” means, collectively, the Obligations, the Cash
Management Obligations and all Indebtedness of the Borrower and its Subsidiaries
permitted under clause (n) of Section 7.2.2 of the Credit Agreement owing to a
Foreign Working Capital Lender.
     SECTION 1.2. Credit Agreement Definitions. Unless otherwise defined herein
or the context otherwise requires, terms used in this Guaranty, including its
preamble and recitals, have the meanings provided in the Credit Agreement.
ARTICLE II
GUARANTY PROVISIONS
     SECTION 2.1. Guaranty. Each Guarantor hereby jointly and severally
absolutely, unconditionally and irrevocably
     (a) guarantees the full and punctual payment when due, whether at stated
maturity, by required prepayment, declaration, acceleration, demand or
otherwise, of all Secured Obligations of the Borrower and its Subsidiaries now
or hereafter existing, whether for principal, interest (including interest
accruing at the then applicable rate provided in the Credit Agreement after the
occurrence of any Event of Default set forth in Section 8.1.9 of the Credit
Agreement, whether or not a claim for post-filing or post-petition interest is
allowed under applicable law following the institution of a proceeding under
bankruptcy, insolvency or similar laws), fees, Reimbursement Obligations,
expenses or otherwise (including all such amounts which would become due but for
the operation of the automatic stay under Section 362(a) of the United States
Bankruptcy Code, 11 U.S.C. §362(a), and the operation of Sections 502(b) and
506(b) of the United States Bankruptcy Code, 11 U.S.C. §502(b) and §506(b)); and
     (b) indemnifies and holds harmless each Secured Party for any and all costs
and reasonable out-of-pocket expenses (including reasonable attorneys’ fees)
incurred by such Secured Party in enforcing any rights under this Guaranty (in
each case to the same extent the Secured Parties are indemnified and held
harmless pursuant to Sections 10.3 and 10.4 of the Credit Agreement);
provided, however, that each Guarantor shall only be liable under this Guaranty
for the maximum amount of such liability that can be hereby incurred without
rendering this Guaranty, as it relates to such Guarantor, voidable under
applicable law relating to fraudulent conveyance or fraudulent transfer, and not
for any greater amount. This Guaranty constitutes a guaranty of payment when due
and not of collection, and each Guarantor specifically agrees that to the extent
permitted by applicable law it shall not be necessary or required that any
Secured Party exercise any right, assert any claim or demand or enforce any
remedy whatsoever against the Borrower or
Guaranty (First Lien)

2

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any of its Subsidiaries or any other Person before or as a condition to the
obligations of such Guarantor hereunder.
     SECTION 2.2. Reinstatement, etc. Each Guarantor hereby jointly and
severally agrees that 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 Secured Obligations is invalidated, declared to be fraudulent or
preferential, set aside, rescinded or must otherwise be restored by any Secured
Party, including upon the occurrence of any Default set forth in Section 8.1.9
of the Credit Agreement or otherwise, all as though such payment had not been
made.
     SECTION 2.3. Guaranty Absolute, etc. To the extent permitted by applicable
law, this Guaranty shall in all respects be a continuing, absolute,
unconditional and irrevocable guaranty of payment, and shall remain in full
force and effect until the Termination Date has occurred. Each Guarantor jointly
and severally guarantees that the Secured Obligations will be paid strictly in
accordance with the terms of each Loan Document or other applicable agreement
under which they arise, regardless of any law, regulation or order now or
hereafter in effect in any jurisdiction affecting any of such terms or the
rights of any Secured Party with respect thereto. The liability of each
Guarantor under this Guaranty shall be joint and several, absolute,
unconditional and irrevocable to the extent permitted by applicable law
irrespective of:
     (a) any lack of validity, legality or enforceability of any Loan Document
or other applicable agreement under which such Secured Obligations arise;
     (b) the failure of any Secured Party
     (i) to assert any claim or demand or to enforce any right or remedy against
the Borrower or any of its Subsidiaries or any other Person (including any other
guarantor) under the provisions of any Loan Document or other applicable
agreement under which such Secured Obligations arise or otherwise, or
     (ii) to exercise any right or remedy against any other guarantor (including
any Guarantor) of, or collateral securing, any Secured Obligations;
     (c) any change in the time, manner or place of payment of, or in any other
term of, all or any part of the Secured Obligations, or any other extension,
compromise or renewal of any Secured Obligation;
     (d) any reduction, limitation, impairment or termination of any Secured
Obligations for any reason (other than the occurrence of the Termination Date),
including any claim of waiver, release, surrender, alteration or compromise, and
shall not be subject to (and each Guarantor hereby waives to the extent
permitted by law, 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 Secured Obligations or otherwise (other than
the occurrence of the Termination Date);
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     (e) any amendment to, rescission, waiver, or other modification of, or any
consent to or departure from, any of the terms of any Loan Document or other
applicable agreement under which such Secured Obligations arise;
     (f) any addition, exchange or release of any collateral or of any Person
that is (or will become) a guarantor (including a Guarantor hereunder) of the
Secured Obligations, or any surrender or non-perfection of any collateral, or
any amendment to or waiver or release or addition to, or consent to or departure
from, any other guaranty held by any Secured Party securing any of the Secured
Obligations;
     (g) any law, regulation, decree or order of any jurisdiction, or any other
event, affecting any term of any Secured Obligation or any Secured Party’s
rights with respect thereto, including (i) the application of any such law,
regulation, decree or order, including any prior approval, which would prevent
the exchange of Non-USD Currency for Dollars or the remittance of funds outside
of such jurisdiction or the unavailability of Dollars in any legal exchange
market in such jurisdiction in accordance with normal commercial practice,
(ii) a declaration of banking moratorium or any suspension of payments by banks
in such jurisdiction or the imposition by such jurisdiction or any Governmental
Authority thereof of any moratorium on, the required rescheduling or
restructuring of, or required approval of payments on, any indebtedness in such
jurisdiction, (iii) any expropriation, confiscation, nationalization or
requisition by such country or any Governmental Authority that directly or
indirectly deprives any Guarantor of any assets or their use or of the ability
to operate its business or a material part thereof, or (iv) any war (whether or
not declared), insurrection, revolution, hostile act, civil strife or similar
events occurring in such jurisdiction which has the same effect as the events
described in clause (i), (ii) or (iii) above (in each of the cases contemplated
in clauses (i) through (iv) above, to the extent occurring or existing on or at
any time after the date of this Guaranty); or
     (h) any other circumstance which might otherwise constitute a defense
available to, or a legal or equitable discharge of, the Borrower or any of its
Subsidiaries, any surety or any guarantor (other than payment or performance of
the Secured Obligations, in each case in full and, with respect to payments, in
cash).
     SECTION 2.4. Setoff. Each Secured Party shall, upon the occurrence and
during the continuance of any Event of Default described in clauses (a) through
(d) of Section 8.1.9 of the Credit Agreement or, with the consent of the
Required Lenders, upon the occurrence and during the continuance of any other
Event of Default, have the right to appropriate and apply to the payment of the
Secured Obligations owing to it (if then due and payable), any and all balances,
credits, deposits, accounts or moneys of such Guarantor then or thereafter
maintained with such Secured Party (other than payroll, trust or tax accounts);
provided that, any such appropriation and application shall be subject to the
provisions of Section 4.8 of the Credit Agreement. Each Secured Party agrees
promptly to notify the applicable Guarantor and the Administrative Agent after
any such appropriation and application made by such Secured Party; provided
that, the failure to give such notice shall not affect the validity of such
setoff and application. The rights of each Secured Party under this Section are
in addition to other rights and remedies (including other rights of setoff under
applicable law or otherwise) which such Secured Party may have.
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     SECTION 2.5. Waiver, etc. Each Guarantor hereby waives, to the extent
permitted by law, promptness, diligence, notice of acceptance and any other
notice with respect to any of the Secured Obligations and this Guaranty and any
requirement that any Secured Party protect, secure, perfect or insure any Lien,
or any property subject thereto, or exhaust any right or take any action against
the Borrower or any of its Subsidiaries or any other Person (including any other
guarantor) or entity or any collateral securing the Secured Obligations, as the
case may be.
     SECTION 2.6. Postponement of Subrogation, etc. Each Guarantor agrees that
it will, to the extent permitted by law, not exercise any rights which it may
acquire by way of rights of subrogation under any Loan Document or other
applicable agreement under which such Secured Obligations arise to which it is a
party, nor shall any Guarantor seek any contribution or reimbursement from the
Borrower or any of its Subsidiaries in respect of any payment made under any
Loan Document or other applicable agreement under which such Secured Obligations
arise or otherwise, until following the Termination Date. Any amount paid to any
Guarantor on account of any such subrogation rights prior to the Termination
Date shall be held in trust for the benefit of the Secured Parties and shall
immediately be paid and turned over to the Administrative Agent for the benefit
of the Secured Parties in the exact form received by such Guarantor (duly
endorsed in favor of the Administrative Agent, if required), to be credited and
applied against the outstanding Secured Obligations, in accordance with
Section 2.7; provided, however, that if any Guarantor has made payment to the
Secured Parties of all or any part of the Secured Obligations and the
Termination Date has occurred, then at such Guarantor’s request, the
Administrative Agent (on behalf of the Secured Parties) will, at the expense of
such Guarantor, 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 Secured
Obligations resulting from such payment. In furtherance of the foregoing, at all
times prior to the Termination Date, each Guarantor shall refrain from taking
any action or commencing any proceeding against the Borrower or any of its
Subsidiaries (or its successors or assigns, whether in connection with a
bankruptcy proceeding or otherwise) to recover any amounts in respect of
payments made under this Guaranty to any Secured Party other than as required by
applicable law to preserve such rights.
     SECTION 2.7. Payments; Application. Each Guarantor hereby agrees with each
Secured Party as follows to the extent permitted by applicable law:
     (a) Each Guarantor agrees that all payments made by such Guarantor
hereunder will be made in the applicable Currency to the Administrative Agent,
without set-off, counterclaim or other defense (other than the defense of
payment or performance) and in accordance with Sections 4.6 and 4.7 of the
Credit Agreement, free and clear of and without deduction for any Taxes, each
Guarantor hereby agreeing to comply with and be bound by the provisions of
Sections 4.6 and 4.7 of the Credit Agreement in respect of all payments made by
it hereunder and the provisions of which Sections are hereby incorporated into
and made a part of this Guaranty by this reference as if set forth herein;
provided, that references to the “Borrower” in such Sections shall also be
deemed to be references to each Subsidiary Guarantor, and references to “this
Agreement” in such Sections shall be deemed to be references to this Guaranty.
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     (b) All payments made hereunder shall be applied upon receipt as set forth
in Section 4.7 of the Credit Agreement.
     SECTION 2.8. Place and Currency of Payment. If any Secured Obligation is
payable in Dollars, such Guarantor will make payment hereunder to the
Administrative Agent in Dollars at 399 Park Avenue, New York, New York. If any
Secured Obligation is payable in a Non-USD Currency and/or at a place other than
the United States, and such payment is not made as and when agreed, such
Guarantor will, at the Administrative Agent’s option, either (a) make payment in
such Non-USD Currency and at the place where such Secured Obligation is payable,
or (b) pay the Administrative Agent in Dollars at 399 Park Avenue, New York, New
York. In the event of a payment pursuant to clause (a) above, such Guarantor
will pay the Administrative Agent the equivalent of the amount of such Secured
Obligation in Dollars calculated at Spot Rate; provided, however, that the
foregoing provisions of this sentence shall not apply to any payments hereunder
in respect of Secured Obligations that have been re-denominated into a Non-USD
Currency as a result of the application of any law, order, decree or regulation
in any jurisdiction other than the United States, which Secured Obligations
shall, for purposes of this Guaranty, be deemed to remain denominated in Dollars
and payable to Administrative Agent in accordance with the first sentence of
this Section 2.8.
ARTICLE III
REPRESENTATIONS AND WARRANTIES
     In order to induce the Secured Parties to enter into the Credit Agreement
and make Credit Extensions thereunder, and to induce Secured Parties to enter
into Rate Protection Agreements, each Guarantor represents and warrants to each
Secured Party as set forth below.
     SECTION 3.1. Credit Agreement Representations and Warranties. The
representations and warranties contained in Article VI of the Credit Agreement,
insofar as the representations and warranties contained therein are applicable
to any Guarantor and its properties, are true and correct in all material
respects, each such representation and warranty set forth in such Article
(insofar as applicable as aforesaid) and all other terms of the Credit Agreement
to which reference is made therein, together with all related definitions and
ancillary provisions, being hereby incorporated into this Guaranty by this
reference as though specifically set forth in this Article.
     SECTION 3.2. Financial Condition, etc. Each Guarantor has knowledge of each
other Obligor’s financial condition and affairs and that it has adequate means
to obtain from each such Obligor on an ongoing basis information relating
thereto and to such Obligor’s ability to pay and perform the Secured
Obligations, and agrees to assume the responsibility for keeping, and to keep,
so informed for so long as this Guaranty is in effect. Each Guarantor
acknowledges and agrees that the Secured Parties shall have no obligation to
investigate the financial condition or affairs of any Obligor for the benefit of
such Guarantor nor to advise such Guarantor of any fact respecting, or any
change in, the financial condition or affairs of any other Obligor that might
become known to any Secured Party at any time, whether or not such Secured Party
knows or believes or has reason to know or believe that any such fact or change
is unknown to such Guarantor, or might (or does) materially increase the risk of
such Guarantor as guarantor, or
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might (or would) affect the willingness of such Guarantor to continue as a
guarantor of the Secured Obligations.
     SECTION 3.3. Best Interests. It is in the best interests of each Guarantor
(other than the Borrower) to execute this Guaranty inasmuch as such Guarantor
will, as a result of being a Subsidiary of the Borrower, derive substantial
direct and indirect benefits from the Credit Extensions made from time to time
to the Borrower by the Lenders and the Issuers pursuant to the Credit Agreement
and the execution and delivery of Rate Protection Agreements between the
Borrower, other Obligors and certain Secured Parties, and each Guarantor agrees
that the Secured Parties are relying on this representation in agreeing to make
Credit Extensions to the Borrower.
ARTICLE IV
COVENANTS, ETC.
     Each Guarantor covenants and agrees that, at all times prior to the
Termination Date, it will perform, comply with and be bound by all of the
agreements to which it is a party, covenants and obligations contained in the
Credit Agreement which are applicable to such Guarantor or its properties, each
such agreement, covenant and obligation contained in the Credit Agreement and
all other terms of the Credit Agreement to which reference is made in this
Article, together with all related definitions and ancillary provisions, being
hereby incorporated into this Guaranty by this reference as though specifically
set forth in this Article.
ARTICLE V
MISCELLANEOUS PROVISIONS
     SECTION 5.1. Loan Document. This Guaranty is a Loan Document executed
pursuant to the Credit Agreement and shall (unless otherwise expressly indicated
herein) be construed, administered and applied in accordance with the terms and
provisions thereof, including Article X thereof.
     SECTION 5.2. Binding on Successors, Transferees and Assigns; Assignment.
This Guaranty shall remain in full force and effect until the Termination Date
has occurred, shall be jointly and severally binding upon each Guarantor and its
successors, transferees and assigns and shall inure to the benefit of and be
enforceable by each Secured Party and its successors, transferees and permitted
assigns; provided, however, that no Guarantor may (unless otherwise permitted
under the terms of the Credit Agreement) assign any of its obligations hereunder
without the prior written consent of all Lenders.
     SECTION 5.3. Amendments, etc. No amendment to or waiver of any provision of
this Guaranty, nor consent to any departure by any Guarantor from its
obligations under this Guaranty, shall in any event be effective unless the same
shall be in writing and signed by the Administrative Agent (on behalf of the
Lenders or the Required Lenders, as the case may be, pursuant to Section 10.1 of
the Credit Agreement) and then such waiver or consent shall be effective only in
the specific instance and for the specific purpose for which given.
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     SECTION 5.4. Notices. All notices and other communications provided for
hereunder shall be in writing or by facsimile and addressed, delivered or
transmitted to the appropriate party at the address or facsimile number of such
party (in the case of any Subsidiary Guarantor, in care of the Borrower) set
forth on Schedule II to the Credit Agreement or at such other address or
facsimile number as may be designated by such party in a notice to the other
party. Any notice, if mailed and properly addressed with postage prepaid or if
properly addressed and sent by pre-paid courier service, shall be deemed given
when received; any such notice, if transmitted by facsimile, shall be deemed
given when the confirmation of transmission thereof is received by the
transmitter.
     SECTION 5.5. Additional Guarantors. Upon the execution and delivery by any
other Person of a supplement in the form of Annex I hereto, such Person shall
become a “Guarantor” hereunder with the same force and effect as if it were
originally a party to this Guaranty and named as a “Guarantor” hereunder. The
execution and delivery of such supplement shall not require the consent of any
other Guarantor hereunder (except to the extent a consent has been obtained),
and the rights and obligations of each Guarantor hereunder shall remain in full
force and effect notwithstanding the addition of any new Guarantor as a party to
this Guaranty.
     SECTION 5.6. Release of Guarantor. Upon the occurrence of the Termination
Date, this Guaranty and all obligations of each Guarantor hereunder shall
terminate, without delivery of any instrument or performance of any act by any
party. In addition, at the request of the Borrower, and at the sole expense of
the Borrower, a Subsidiary Guarantor shall be automatically released from its
obligations hereunder in the event that the Capital Securities of such
Subsidiary Guarantor are Disposed of in a transaction permitted by the Credit
Agreement; provided, that the Borrower shall have delivered to the
Administrative Agent, prior to the date of the proposed release, a written
request for release identifying the relevant Subsidiary Guarantor. The
Administrative Agent agrees to deliver to the Borrower, at the Borrower’s sole
expense, such documents as the Borrower may reasonably request to evidence such
termination and release.
     SECTION 5.7. No Waiver; Remedies. In addition to, and not in limitation of,
Sections 2.3 and 2.5, no failure on the part of any Secured 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 5.8. Section Captions. Section captions used in this Guaranty are
for convenience of reference only, and shall not affect the construction of this
Guaranty.
     SECTION 5.9. Severability. Wherever possible each provision of this
Guaranty shall be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this Guaranty shall be prohibited by or
invalid under such 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 Guaranty.
     SECTION 5.10. Judgment Currency. The Secured Obligations of each Guarantor
in respect of any sum due to any Secured Party under or in respect of this
Guaranty shall,
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notwithstanding any judgment in a currency (the “Judgment Currency”) other than
the currency in which such sum was originally denominated (the “Original
Currency”), be discharged only to the extent that on the Business Day following
receipt by such Secured Party of any sum adjudged to be so due in the Judgment
Currency, such Secured Party, in accordance with normal banking procedures,
purchases the Original Currency with the Judgment Currency. If the amount of
Original Currency so purchased is less than the sum originally due to such
Secured Party, such Guarantor agrees, as a separate obligation and
notwithstanding any such judgment, to indemnify such Secured Party against such
loss, and if the amount of Original Currency so purchased exceeds the sum
originally due to such Secured Party, such Secured Party agrees to remit such
excess to such Guarantor.
     SECTION 5.11. Governing Law, Entire Agreement, etc. THIS GUARANTY WILL BE
DEEMED TO BE A CONTRACT MADE UNDER AND GOVERNED BY THE INTERNAL LAWS OF THE
STATE OF NEW YORK (INCLUDING FOR SUCH PURPOSE SECTIONS 5-1401 AND 5-1402 OF THE
GENERAL OBLIGATIONS LAW OF THE STATE OF NEW YORK). This Guaranty and the other
Loan Documents constitute the entire understanding among the parties hereto with
respect to the subject matter hereof and thereof and supersede any prior
agreements, written or oral, with respect thereto.
     SECTION 5.12. Forum Selection and Consent to Jurisdiction. ANY LITIGATION
BASED HEREON, OR ARISING OUT OF, UNDER, OR IN CONNECTION WITH, ANY LOAN
DOCUMENT, OR ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER ORAL
OR WRITTEN) OR ACTIONS OF THE ADMINISTRATIVE AGENT, THE LENDERS, THE ISSUER OR
ANY GUARANTOR IN CONNECTION HEREWITH OR THEREWITH MAY BE BROUGHT AND MAINTAINED
IN THE COURTS OF THE STATE OF NEW YORK OR IN THE UNITED STATES DISTRICT COURT
FOR THE SOUTHERN DISTRICT OF NEW YORK; PROVIDED, HOWEVER, THAT ANY SUIT SEEKING
ENFORCEMENT AGAINST ANY COLLATERAL OR OTHER PROPERTY MAY BE BROUGHT, AT THE
ADMINISTRATIVE AGENT’S OPTION, IN THE COURTS OF ANY JURISDICTION WHERE SUCH
COLLATERAL OR OTHER PROPERTY MAY BE FOUND. EACH GUARANTOR IRREVOCABLY CONSENTS
TO THE SERVICE OF PROCESS BY REGISTERED MAIL, POSTAGE PREPAID, OR BY PERSONAL
SERVICE WITHIN OR WITHOUT THE STATE OF NEW YORK AT THE ADDRESS FOR NOTICES
SPECIFIED FOR THE BORROWER IN SECTION 10.2 OF THE CREDIT AGREEMENT. EACH
GUARANTOR HEREBY EXPRESSLY AND IRREVOCABLY WAIVES, TO THE FULLEST EXTENT
PERMITTED BY LAW, ANY OBJECTION WHICH IT MAY HAVE OR HEREAFTER MAY HAVE TO THE
LAYING OF VENUE OF ANY SUCH LITIGATION BROUGHT IN ANY SUCH COURT REFERRED TO
ABOVE AND ANY CLAIM THAT ANY SUCH LITIGATION HAS BEEN BROUGHT IN AN INCONVENIENT
FORUM. TO THE EXTENT THAT ANY GUARANTOR HAS OR HEREAFTER MAY ACQUIRE ANY
IMMUNITY FROM JURISDICTION OF ANY COURT OR FROM ANY LEGAL PROCESS (WHETHER
THROUGH SERVICE OR NOTICE, ATTACHMENT PRIOR TO JUDGMENT, ATTACHMENT IN AID OF
EXECUTION OR OTHERWISE) WITH RESPECT TO ITSELF OR ITS PROPERTY, SUCH GUARANTOR
HEREBY IRREVOCABLY WAIVES TO THE FULLEST EXTENT PERMITTED BY LAW SUCH IMMUNITY
IN RESPECT OF ITS OBLIGATIONS UNDER THE LOAN DOCUMENTS.
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     SECTION 5.13. Waiver of Jury Trial. THE ADMINISTRATIVE AGENT (ON BEHALF OF
ITSELF AND EACH OTHER SECURED PARTY) AND EACH GUARANTOR HEREBY KNOWINGLY,
VOLUNTARILY AND INTENTIONALLY WAIVE TO THE FULLEST EXTENT PERMITTED BY LAW ANY
RIGHTS THEY MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION BASED
HEREON, OR ARISING OUT OF, UNDER, OR IN CONNECTION WITH, EACH LOAN DOCUMENT, OR
ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER ORAL OR WRITTEN)
OR ACTIONS OF THE ADMINISTRATIVE AGENT, SUCH LENDER, THE ISSUER OR SUCH
GUARANTOR IN CONNECTION THEREWITH. EACH GUARANTOR ACKNOWLEDGES AND AGREES THAT
IT HAS RECEIVED FULL AND SUFFICIENT CONSIDERATION FOR THIS PROVISION (AND EACH
OTHER PROVISION OF EACH OTHER LOAN DOCUMENT TO WHICH IT IS A PARTY) AND THAT
THIS PROVISION IS A MATERIAL INDUCEMENT FOR THE ADMINISTRATIVE AGENT, EACH
LENDER AND THE ISSUER ENTERING INTO THE LOAN DOCUMENTS.
     SECTION 5.14. Counterparts. This Guaranty may be executed by the parties
hereto in several counterparts, each of which shall be deemed to be an original
and all of which shall constitute together but one and the same agreement.
Delivery of an executed counterpart of a signature page to this Guaranty by
facsimile (or other electronic transmission) shall be effective as delivery of a
manually executed counterpart of this Guaranty.
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     IN WITNESS WHEREOF, each Guarantor has caused this Guaranty to be duly
executed and delivered by its Authorized Officer, solely in such capacity and
not as an individual, as of the date first above written.

             
 
                HANESBRANDS INC.      
 
  By:        
 
           
 
      Name:    
 
      Title:    
 
                HBI BRANDED APPAREL LIMITED, INC.      
 
  By:        
 
           
 
      Name:    
 
      Title:    
 
                HANESBRANDS DIRECT, LLC      
 
  By:        
 
           
 
      Name:    
 
      Title:    
 
                UPEL, INC.      
 
  By:        
 
           
 
      Name:    
 
      Title:    
 
                CARIBETEX, INC.      
 
  By:        
 
           
 
      Name:    
 
      Title:    
 
                SEAMLESS TEXTILES, LLC      
 
  By:        
 
           
 
      Name:    
 
      Title:    

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                BA INTERNATIONAL, L.L.C.      
 
  By:        
 
           
 
      Name:    
 
      Title:    
 
                HBI INTERNATIONAL, LLC      
 
  By:        
 
           
 
      Name:    
 
      Title:    
 
                HBI BRANDED APPAREL ENTERPRISES, LLC      
 
  By:        
 
           
 
      Name:    
 
      Title:    
 
                CASA INTERNATIONAL, LLC      
 
  By:        
 
           
 
      Name:    
 
      Title:    
 
                UPCR, INC.      
 
  By:        
 
           
 
      Name:    
 
      Title:    
 
                HBI SOURCING, LLC      
 
  By:        
 
           
 
      Name:    
 
      Title:    
 
                CEIBENA DEL, INC.      
 
  By:        
 
           
 
      Name:    
 
      Title:    

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                NT INVESTMENT COMPANY, INC.      
 
  By:        
 
           
 
      Name:    
 
      Title:    
 
                HANESBRANDS DISTRIBUTION, INC.      
 
  By:        
 
           
 
      Name:    
 
      Title:    
 
                CARIBESOCK, INC.      
 
  By:        
 
           
 
      Name:    
 
      Title:    
 
                NATIONAL TEXTILES, L.L.C.      
 
  By:        
 
           
 
      Name:    
 
      Title:         HANES PUERTO RICO, INC.      
 
  By:        
 
           
 
      Name:    
 
      Title:    
 
                PLAYTEX INDUSTRIES, INC.      
 
  By:        
 
           
 
      Name:    
 
      Title:    
 
                INNER SELF LLC      
 
  By:        
 
           
 
      Name:    
 
      Title:    

Guaranty (First Lien)

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                PLAYTEX DORADO, LLC      
 
  By:        
 
           
 
      Name:    
 
      Title:    
 
                HANES MENSWEAR, LLC      
 
  By:        
 
           
 
      Name:    
 
      Title:    

Guaranty (First Lien)

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ACCEPTED AND AGREED FOR ITSELF
AND ON BEHALF OF THE SECURED PARTIES:
CITICORP USA, INC.,
      as Administrative Agent

         
 
       
By:
       
 
       
 
  Name:    
 
  Title:    

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ANNEX I to
the Guaranty
     THIS SUPPLEMENT, dated as of                                          ,
                     (this “Supplement”), is to the Guaranty, dated as of
September 5, 2006 (as amended, supplemented, amended and restated or otherwise
modified from time to time, the “Guaranty”), among the Guarantors (such
capitalized term, and other terms used in this Supplement, to have the meanings
set forth or incorporated by reference in Article I of the Guaranty) from time
to time party thereto, in favor of CITICORP USA, INC., as administrative agent
(together with its successor(s) thereto in such capacity, the “Administrative
Agent”) for each of the Secured Parties.
W I T N E S S E T H :
     WHEREAS, pursuant to the provisions of Section 5.5 of the Guaranty, each of
the undersigned is becoming a Subsidiary Guarantor under the Guaranty; and
     WHEREAS, each of the undersigned desires to become a “Guarantor” under the
Guaranty in order to induce the Secured Parties to continue to extend Credit
Extensions under the Credit Agreement;
     NOW, THEREFORE, in consideration of the premises, and for other
consideration (the receipt and sufficiency of which is hereby acknowledged),
each of the undersigned agrees, for the benefit of each Secured Party, as
follows.
     SECTION 1. Party to Guaranty, etc. In accordance with the terms of the
Guaranty, by its signature below, each of the undersigned hereby irrevocably
agrees to become a Subsidiary Guarantor under the Guaranty with the same force
and effect as if it were an original signatory thereto and each of the
undersigned hereby (a) agrees to be bound by and comply with all of the terms
and provisions of the Guaranty applicable to it as a Subsidiary Guarantor and
(b) represents and warrants that the representations and warranties made by it
as a Subsidiary Guarantor thereunder are true and correct in all material
respects as of the date hereof. In furtherance of the foregoing, each reference
to a “Guarantor” and/or “Guarantors” in the Guaranty shall be deemed to include
each of the undersigned.
     SECTION 2. Representations. Each of the undersigned hereby represents and
warrants that this Supplement has been duly authorized, executed and delivered
by it and that this Supplement and the Guaranty constitute the legal, valid and
binding obligation of each of the undersigned, enforceable (except, in any case,
as such enforceability may be limited by applicable bankruptcy, insolvency,
reorganization or similar laws affecting creditors’ rights generally and by
principles of equity) against it in accordance with its terms.
     SECTION 3. Full Force of Guaranty. Except as expressly supplemented hereby,
the Guaranty shall remain in full force and effect in accordance with its terms.
     SECTION 4. Severability. Wherever possible each provision of this
Supplement shall be interpreted in such manner as to be effective and valid
under applicable law, but if any provision of this Supplement shall be
prohibited by or invalid under such law, such provision
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shall be ineffective to the extent of such prohibition or invalidity, without
invalidating the remainder of such provision or the remaining provisions of this
Supplement or the Guaranty.
     SECTION 5. Indemnity; Fees and Expenses, etc. Without limiting the
provisions of any other Loan Document, each of the undersigned agrees to
reimburse the Administrative Agent for its reasonable out-of-pocket expenses
incurred in connection with this Supplement, including reasonable attorney’s
fees and out-of-pocket expenses of the Administrative Agent’s counsel.
     SECTION 6. Governing Law, Entire Agreement, etc. THIS SUPPLEMENT WILL BE
DEEMED TO BE A CONTRACT MADE UNDER AND GOVERNED BY THE INTERNAL LAWS OF THE
STATE OF NEW YORK (INCLUDING FOR SUCH PURPOSE SECTIONS 5-1401 AND 5-1402 OF THE
GENERAL OBLIGATIONS LAW OF THE STATE OF NEW YORK). This Supplement and the other
Loan Documents constitute the entire understanding among the parties hereto with
respect to the subject matter hereof and thereof and supersede any prior
agreements, written or oral, with respect thereto.
     SECTION 7. Counterparts. This Supplement may be executed by the parties
hereto in several counterparts, each of which shall be deemed to be an original
and all of which shall constitute together but one and the same agreement.
Delivery of an executed counterpart of a signature page to this Supplement by
facsimile (or other electronic transmission) shall be effective as delivery of a
manually executed counterpart of this Supplement.
Guaranty (First Lien)
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     IN WITNESS WHEREOF, each of the undersigned has caused this Supplement to
be duly executed and delivered by its Authorized Officer as of the date first
above written.

             
 
                [NAME OF ADDITIONAL SUBSIDIARY]    
 
           
 
  By:        
 
           
 
      Name:    
 
      Title:    
 
                [NAME OF ADDITIONAL SUBSIDIARY]    
 
           
 
  By:        
 
           
 
      Name:    
 
      Title:    
 
                [NAME OF ADDITIONAL SUBSIDIARY]    
 
           
 
  By:        
 
           
 
      Name:    
 
      Title:    

ACCEPTED AND AGREED FOR ITSELF
AND ON BEHALF OF THE SECURED PARTIES:
CITICORP USA, INC.,
      as Administrative Agent

         
 
       
By:
       
 
       
 
  Name:    
 
  Title:    

Guaranty (First Lien)
Annex I - 3

 

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EXHIBIT G
EXECUTION COPY
PLEDGE AND SECURITY AGREEMENT
     This PLEDGE AND SECURITY AGREEMENT, dated as of September 5, 2006 (as
amended, supplemented, amended and restated or otherwise modified from time to
time, this “Security Agreement”), is made by HANESBRANDS INC., a Maryland
corporation (the “Borrower”), and each Subsidiary Guarantor (terms used in the
preamble and the recitals have the definitions set forth in or incorporated by
reference in Article I) from time to time a party to this Security Agreement
(each individually a “Grantor” and collectively, the “Grantors”), in favor of
CITIBANK, N.A., a national banking association organized under the laws of the
United States, as the collateral agent (together with its successor(s) thereto
in such capacity, the “Collateral Agent”) for each of the Secured Parties and
CITICORP USA, INC., as the administrative agent (together with its successor(s)
thereto in such capacity, the “Administrative Agent”) for each of the Secured
Parties.
W I T N E S S E T H :
     WHEREAS, pursuant to a First Lien Credit Agreement, dated as of
September 5, 2006 (as amended, supplemented, amended and restated or otherwise
modified from time to time, the “Credit Agreement”), among the Borrower, the
Lenders, HSBC Bank USA, National Association, LaSalle Bank National Association
and Barclays Bank PLC, as the Co-Documentation Agents, Merrill Lynch, Pierce,
Fenner & Smith Incorporated and Morgan Stanley Senior Funding, Inc., as the
Co-Syndication Agents, the Administrative Agent, the Collateral Agent, and
Merrill Lynch, Pierce, Fenner & Smith Incorporated and Morgan Stanley Senior
Funding, Inc., as the Joint Lead Arrangers and Joint Bookrunners, the Lenders
and the Issuers have extended Commitments to make Credit Extensions to the
Borrower; and
     WHEREAS, as a condition precedent to the making of the Credit Extensions
under the Credit Agreement, each Grantor is required to execute and deliver this
Security Agreement;
     NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, each Grantor agrees, for the
benefit of each Secured Party, as follows:
ARTICLE I
DEFINITIONS
     SECTION 1.1. Certain Terms. The following terms (whether or not
underscored) when used in this Security Agreement, including its preamble and
recitals, shall have the following meanings (such definitions to be equally
applicable to the singular and plural forms thereof):
     “Administrative Agent” is defined in the preamble.
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     “Borrower” is defined in the preamble.
     “Collateral” is defined in Section 2.1.
     “Collateral Account” is defined in clause (b) of Section 4.3.
     “Collateral Agent” is defined in the preamble.
     “Computer Hardware and Software Collateral” means all of the Grantors’
right, title and interest in and to:
     (a) all computer and other electronic data processing hardware, 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,
including all operating system software, utilities and application programs in
whatsoever form;
     (b) all software programs (including both source code, object code and all
related applications and data files), designed for use on the computers and
electronic data processing hardware described in clause (a) above;
     (c) all firmware associated therewith;
     (d) all documentation (including flow charts, logic diagrams, manuals,
guides, specifications, training materials, charts and pseudo codes) with
respect to such hardware, software and firmware described in the preceding
clauses (a) through (c); and
     (e) all rights with respect to all of the foregoing, including copyrights,
licenses, options, warranties, service contracts, program services, test rights,
maintenance rights, support rights, improvement rights, renewal rights and
indemnifications and any substitutions, replacements, improvements, error
corrections, updates, additions or model conversions of any of the foregoing;
     provided that the foregoing shall not include Excluded Collateral.
     “Control Agreement” means an authenticated record in form and substance
reasonably satisfactory to the Collateral Agent, that provides for the
Collateral Agent to have “control” (as defined in the UCC) over certain
Collateral as provided herein.
     “Copyright Collateral” means all of the Grantors’ right, title and interest
in and to:
     (a) all U.S. copyrights, registered or unregistered and whether published
or unpublished, now or hereafter in force including copyrights registered or
applied for in the United States Copyright Office, and registrations and
recordings thereof and all applications for registration thereof, whether
pending or in preparation and all extensions and renewals of the foregoing
(“Copyrights”), including the Copyrights which are the subject of a registration
or application referred to in Item A of Schedule V;
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     (b) all express or implied Copyright licenses and other agreements for the
grant by or to such Grantor of any right to use any items of the type referred
to in clause (a) above (each a “Copyright License”), including each Copyright
License referred to in Item B of Schedule V;
     (c) the right to sue for past, present and future infringements of any of
the Copyrights owned by such Grantor, and for breach or enforcement of any
Copyright License; and
     (d) all proceeds of, and rights associated with, the foregoing (including
Proceeds, licenses, royalties, income, payments, claims, damages and proceeds of
infringement suits);
     provided that the foregoing shall not include Excluded Collateral.
     “Credit Agreement” is defined in the first recital.
     “Distributions” means all dividends paid on Capital Securities, liquidating
dividends paid on Capital Securities, shares (or other designations) of Capital
Securities resulting from (or in connection with the exercise of) stock splits,
reclassifications, warrants, options, non cash dividends, mergers,
consolidations, and all other distributions on or with respect to any Capital
Securities constituting Collateral.
     “Excluded Accounts” means payroll accounts, petty cash accounts, pension
fund accounts, 401(k) accounts, zero-balance accounts and other accounts that
any Grantor may hold in trust for others.
     “Excluded Collateral” is defined in Section 2.1.
     “General Intangibles” means all “general intangibles” and all “payment
intangibles”, each as defined in the UCC, and shall include all interest rate or
currency protection or hedging arrangements, all tax refunds, all licenses,
permits, concessions and authorizations and all Intellectual Property Collateral
(in each case, regardless of whether characterized as general intangibles under
the UCC).
     “Grantor” and “Grantors” are defined in the preamble.
     “Intellectual Property” means Trademarks, Patents, Copyrights, Trade
Secrets and all other similar types of intellectual property under any law,
statutory provision or common law doctrine in the United States.
     “Intellectual Property Collateral” means, collectively, the Computer
Hardware and Software Collateral, the Copyright Collateral, the Patent
Collateral, the Trademark Collateral and the Trade Secrets Collateral.
     “Owned Intellectual Property Collateral” means all Intellectual Property
Collateral that is owned by the Grantors.
     “Patent Collateral” means all of the Grantors’ right, title and interest in
and to:
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     (a) inventions and discoveries, whether patentable or not, all letters
patent and applications for United States letters patent, including all United
States patent applications in preparation for filing, including all reissues,
divisions, continuations, continuations in part, extensions, renewals and
reexaminations of any of the foregoing, including all patents issued by, or
patent applications filed with, the United States Patent and Trademark Office
(“Patents”), including each Patent and Patent application referred to in Item A
of Schedule III;
     (b) all Patent licenses, and other agreements for the grant by or to such
Grantor of any right to use any items of the type referred to in clause (a)
above (each a “Patent License”), including each Patent License referred to in
Item B of Schedule III;
     (c) the right to sue third parties for past, present and future
infringements of any Patent or Patent application, and for breach or enforcement
of any Patent License; and
     (d) all proceeds of, and rights associated with, the foregoing (including
Proceeds, licenses, royalties, income, payments, claims, damages and proceeds of
infringement suits);
     provided that the foregoing shall not include Excluded Collateral.
     “Permitted Liens” means all Liens permitted by Section 7.2.3 of the Credit
Agreement or any other Loan Document.
     “Secured Obligations” means, collectively, the Obligations, the Cash
Management Obligations and all Indebtedness of any Foreign Subsidiary or
Obligor, as applicable, permitted under clause (n) of Section 7.2.2 of the
Credit Agreement owing to a Foreign Working Capital Lender.
     “Securities Act” is defined in clause (a) of Section 6.2.
     “Security Agreement” is defined in the preamble.
     “Trademark Collateral” means all of the Grantors’ right, title and interest
in and to:
     (a) (i) all United States trademarks, trade names, corporate names, company
names, business names, fictitious business names, trade styles, service marks,
certification marks, collective marks, logos and other source or business
identifiers, and all goodwill of the business associated therewith, now existing
or hereafter adopted or acquired, whether currently in use or not, all
registrations and recordings thereof and all applications in connection
therewith, whether pending or in preparation for filing, including
registrations, recordings and applications in the United States Patent and
Trademark Office, and all common law rights relating to the foregoing, and
(ii) the right to obtain all reissues, extensions or renewals of the foregoing
(collectively referred to as “Trademarks”), including those Trademarks referred
to in Item A of Schedule IV;
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     (b) all Trademark licenses and other agreements for the grant by or to such
Grantor of any right to use any Trademark (each a “Trademark License”),
including each Trademark License referred to in Item B of Schedule IV; and
     (c) all of the goodwill of the business connected with the use of, and
symbolized by the Trademarks described in clause (a) and, to the extent
applicable, clause (b);
     (d) the right to sue third parties for past, present and future
infringements or dilution of the Trademarks described in clause (a) and, to the
extent applicable, clause (b) or for any injury to the goodwill associated with
the use of any such Trademark or for breach or enforcement of any Trademark
License; and
     (e) all proceeds of, and rights associated with, the foregoing (including
Proceeds, licenses, royalties, income, payments, claims, damages and proceeds of
infringement suits);
     provided that the foregoing shall not include Excluded Collateral.
     “Trade Secrets Collateral” means all of the Grantors’ right, title and
interest throughout the world in and to (a) all common law and statutory trade
secrets and all other confidential, proprietary or useful information and all
know how (collectively referred to as “Trade Secrets”) obtained by or used in or
contemplated at any time for use in the business of a Grantor, whether or not
such Trade Secret has been reduced to a writing or other tangible form,
including all Documents and things embodying, incorporating or referring in any
way to such Trade Secret, (b) all Trade Secret licenses and other agreements for
the grant by or to such Grantor of any right to use any Trade Secret (each a
“Trade Secret License”) including the right to sue for and to enjoin and to
collect damages for the actual or threatened misappropriation of any Trade
Secret and for the breach or enforcement of any such Trade Secret License, and
(d) all proceeds of, and rights associated with, the foregoing (including
Proceeds, licenses, royalties, income, payments, claims, damages and proceeds of
infringement suits);
     provided that the foregoing shall not include Excluded Collateral.
     SECTION 1.2. Credit Agreement Definitions. Unless otherwise defined herein
or the context otherwise requires, terms used in this Security Agreement,
including its preamble and recitals, have the meanings provided in the Credit
Agreement.
     SECTION 1.3. UCC Definitions. When used herein the terms Account,
Certificate of Title, Certificated Securities, Chattel Paper, Commercial Tort
Claim, Commodity Account, Commodity Contract, Deposit Account, Document,
Electronic Chattel Paper, Equipment, Goods, Instrument, Inventory, Investment
Property, Letter-of-Credit Rights, Payment Intangibles, Proceeds, Promissory
Notes, Securities Account, Security Entitlement, Supporting Obligations and
Uncertificated Securities have the meaning provided in Article 8 or Article 9,
as applicable, of the UCC. Letters of Credit has the meaning provided in
Section 5-102 of the UCC.
ARTICLE II
SECURITY INTEREST
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     SECTION 2.1. Grant of Security Interest. Each Grantor hereby grants to the
Collateral Agent, for its benefit and the ratable benefit of each other Secured
Party, a continuing security interest in all of such Grantor’s right, title and
interest in and to the following property, whether now or hereafter existing,
owned or acquired by such Grantor, and wherever located, (collectively, the
“Collateral”):
     (a) Accounts;
     (b) Chattel Paper;
     (c) Commercial Tort Claims listed on Item I of Schedule II (as such
schedule may be amended or supplemented from time to time);
     (d) Deposit Accounts;
     (e) Documents;
     (f) General Intangibles;
     (g) Goods;
     (h) Instruments;
     (i) Investment Property;
     (j) Letter-of-Credit Rights and Letters of Credit;
     (k) Supporting Obligations;
     (l) all books, records, writings, databases, information and other property
relating to, used or useful in connection with, evidencing, embodying,
incorporating or referring to, any of the foregoing in this Section;
     (m) all Proceeds and products of the foregoing and, to the extent not
otherwise included, all payments under insurance (whether or not the Collateral
Agent is the loss payee thereof); and
     (n) all other property and rights of every kind and description and
interests therein.
Notwithstanding the foregoing, the term “Collateral” shall not include the
following (collectively, the “Excluded Collateral”):
     (i) such Grantor’s real property interests (including fee real estate,
leasehold interests and fixtures);
     (ii) any General Intangibles, healthcare insurance receivables or other
rights arising under any contracts, instruments, licenses or other documents as
to which the grant of a security interest would (A) constitute a violation of a
valid and enforceable
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restriction in favor of a third party on such grant, unless any required consent
shall have been obtained, (B) give any other party to such contract, instrument,
license or other document the right to terminate its obligations thereunder, or
(C) otherwise cause such Grantor to lose material rights thereunder;
     (iii) Investment Property consisting of Capital Securities of a direct
Foreign Subsidiary of such Grantor, in excess of 65% of the total combined
voting power of all Capital Securities of each such direct Foreign Subsidiary,
except that such 65% limitation shall not apply to a direct Foreign Subsidiary
that (x) is treated as a partnership under the Code or (y) is not treated as an
entity that is separate from (A) such Grantor; (B) any Person that is treated as
a partnership under the Code or (C) any “United States person” (as defined in
Section 7701(a)(30) of the Code);
     (iv) any Investment Property (other than Equity Interests of a Subsidiary)
of any of the Grantors to the extent that applicable law or the organizational
documents or other applicable agreements among the investors of such Person with
respect to any such Investment Property (A) does not permit the grant of a
security interest in such interest or an assignment of such interest or requires
the consent of any third party to permit such grant of a security interest or
assignment or (B) would, following the grant of a security interest or
assignment hereunder, would cause any other Person (other than the Borrower or
any of its Subsidiaries) to have the right to purchase such Investment Property;
     (v) any real or personal property, the granting of a security interest in
which would be void or illegal under any applicable governmental law, rule or
regulation, or pursuant thereto would result in, or permit the termination of,
such asset;
     (vi) any real or personal property subject to a Permitted Lien (other than
Liens in favor of the Collateral Agent) to the extent that the grant of other
Liens on such asset (A) would result in a breach or violation of, or constitute
a default under, the agreement or instrument governing such Permitted Lien,
(B) would result in the loss of use of such asset, (C) would permit the holder
of such Permitted Lien to terminate such Grantor’s use of such asset or
(D) would otherwise result in a loss of material rights of such Grantor in such
asset;
     (vii) any Excluded Accounts;
     (viii) any Excluded Contracts to the extent any third party consent
required to grant a security interest in such rights, contracts, licenses,
leases and other agreements has not been obtained by the applicable Grantor;
provided that any such rights, contracts, licenses, leases and other agreements
shall constitute Collateral and a security interest shall attach immediately to
any such rights, contracts, licenses, leases and other agreements at the time
the applicable Grantor obtains the applicable required consent; or
     (ix) any applications for United States trademark registration pursuant to
IS U.S.L. §1051(b) (i.e., an intent-to-use application), until such time as such
registration is granted or, if earlier, the date of first use of the trademark,
at which point such application or registration shall constitute Collateral.
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     SECTION 2.2. Security for Secured Obligations. This Security Agreement and
the Collateral in which the Collateral Agent for the benefit of the Secured
Parties is granted a security interest hereunder by the Grantors secure the
payment and performance of all of the Secured Obligations.
     SECTION 2.3. Grantors Remain Liable. Anything herein to the contrary
notwithstanding, to the extent permitted by applicable law:
     (a) the Grantors will remain liable under the contracts and agreements
included in the Collateral to the extent set forth therein, and will perform all
of their duties and obligations under such contracts and agreements to the same
extent as if this Security Agreement had not been executed;
     (b) the exercise by the Collateral Agent of any of its rights hereunder
will not release any Grantor from any of its duties or obligations under any
such contracts or agreements included in the Collateral; and
     (c) no Secured Party will have any obligation or liability under any
contracts or agreements included in the Collateral by reason of this Security
Agreement, nor will any Secured Party be obligated to perform any of the
obligations or duties of any Grantor thereunder or to take any action to collect
or enforce any claim for payment assigned hereunder.
     SECTION 2.4. Distributions on Pledged Shares. In the event that any
Distribution with respect to any Capital Securities pledged hereunder is
permitted to be paid (in accordance with Section 7.2.6 of the Credit Agreement),
such Distribution or payment may be paid directly to the applicable Grantor. If
any Distribution is made in contravention of Section 7.2.6 of the Credit
Agreement, such Grantor shall hold the same segregated and for the benefit of
the Collateral Agent until paid to the Collateral Agent in accordance with
Section 4.1.5.
     SECTION 2.5. Security Interest Absolute, etc. To the extent permitted by
applicable law, this Security Agreement shall in all respects be a continuing,
absolute, unconditional and irrevocable grant of security interest, and shall
remain in full force and effect until the Termination Date. To the extent
permitted by applicable law, all rights of the Secured Parties and the security
interests granted to the Collateral Agent (for its benefit and the ratable
benefit of each other Secured Party) hereunder, and all obligations of the
Grantors hereunder, shall, in each case, be absolute, unconditional and
irrevocable irrespective of:
     (a) any lack of validity, legality or enforceability of any Loan Document
or other applicable agreement under which such Secured Obligations arise;
     (b) the failure of any Secured Party (i) to assert any claim or demand or
to enforce any right or remedy against the Borrower or any of its Subsidiaries
or any other Person (including any other Grantor) under the provisions of any
Loan Document or other applicable agreement under which such Secured Obligations
arise or otherwise, or (ii) to exercise any right or remedy against any other
guarantor (including any other Grantor) of, or Collateral securing, any Secured
Obligations;
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     (c) any change in the time, manner or place of payment of, or in any other
term of, all or any part of the Secured Obligations, or any other extension,
compromise or renewal of any Secured Obligations;
     (d) any reduction, limitation, impairment or termination of any Secured
Obligations for any reason (other than the occurrence of the Termination Date),
including any claim of waiver, release, surrender, alteration or compromise, and
shall not be subject to (and each Grantor hereby waives (to the extent permitted
by law) 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 Secured Obligations or otherwise;
     (e) any amendment to, rescission, waiver, or other modification of, or any
consent to or departure from, any of the terms of any Loan Document or other
applicable agreement under which such Secured Obligations arise;
     (f) any addition, exchange or release of any Collateral or of any Person
that is (or will become) a Grantor (including the Grantors hereunder) of the
Secured Obligations, or any surrender or non-perfection of any Collateral, or
any amendment to or waiver or release or addition to, or consent to or departure
from, any other guaranty held by any Secured Party securing any of the Secured
Obligations; or
     (g) any other circumstance (other than payment or performance of the
Secured Obligations, in each case in full and, with respect to payments, in
cash) which might otherwise constitute a defense available to, or a legal or
equitable discharge of, the Borrower or any of its Subsidiaries, any surety or
any guarantor.
     SECTION 2.6. Postponement of Subrogation. Each Grantor agrees that it will
not exercise any rights against another Grantor which it may acquire by way of
rights of subrogation under any Loan Document or other applicable agreement
under which such Secured Obligations arise to which it is a party until the
Termination Date. No Grantor shall seek any contribution or reimbursement from
the Borrower or any of its Subsidiaries, in respect of any payment made under
any Loan Document or other applicable agreement under which such Secured
Obligations arise or otherwise, until following the Termination Date. Any amount
paid to such Grantor on account of any such subrogation rights prior to the
Termination Date shall be held in trust for the benefit of the Secured Parties
and shall immediately be paid and turned over to the Collateral Agent for the
benefit of the Secured Parties in the exact form received by such Grantor (duly
endorsed in favor of the Collateral Agent, if required), to be credited and
applied against the outstanding Secured Obligations in accordance with
Section 6.1; provided that if such Grantor has made payment to the Secured
Parties of all or any part of the Secured Obligations and the Termination Date
has occurred, then upon such Grantor’s notice to the Collateral Agent of such
payment and request, the Collateral Agent (on behalf of the Secured Parties)
will, at the expense of such Grantor, execute and deliver to such Grantor
appropriate documents (without recourse and without representation or warranty)
necessary to evidence the transfer by subrogation to such Grantor of an interest
in the Secured Obligations resulting from such payment. In furtherance of the
foregoing, at all times prior to the Termination Date, such Grantor shall
refrain from taking
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any action or commencing any proceeding against the Borrower or any of its
Subsidiaries (or its successors or assigns, whether in connection with a
bankruptcy proceeding or otherwise) to recover any amounts in respect of
payments made under this Security Agreement to any Secured Party.
ARTICLE III
REPRESENTATIONS AND WARRANTIES
     In order to induce the Secured Parties to enter into the Credit Agreement
and make Credit Extensions thereunder, and to induce the Secured Parties to
enter into Rate Protection Agreements, after giving effect to the consummation
of the IP Purchase and the Spin-Off, the Grantors represent and warrant to each
Secured Party as set forth below.
     SECTION 3.1. As to Capital Securities of the Subsidiaries, Investment
Property.
     (a) With respect to any direct U.S. Subsidiary of any Grantor that is
     (i) a corporation, business trust, joint stock company or similar Person,
all Capital Securities issued by such Subsidiary is duly authorized and validly
issued, fully paid and non assessable; and
     (ii) a partnership or limited liability company, no Capital Securities
issued by such Subsidiary (A) is dealt in or traded on securities exchanges or
in securities markets, (B) expressly provides that such Capital Securities is a
security governed by Article 8 of the UCC or (C) is held in a Securities
Account, except, with respect to this clause (a)(ii), Capital Securities (x) for
which the Administrative Agent or the Collateral Agent is the registered owner
or (y) with respect to which the issuer has agreed in an authenticated record
with such Grantor and the Collateral Agent (at the written instruction of the
Administrative Agent) to comply with any written instructions of the Collateral
Agent (at the written instruction of the Administrative Agent) without the
consent of such Grantor; provided that the Grantor shall have the right to
provide instructions to such issuer until such issuer receives notice of sole
control from the Collateral Agent (at the written instruction of the
Administrative Agent) during the continuance of an Event of Default; provided
further that upon the cure or waiver of all Events of Default, the Grantor shall
have the right to give instructions to the issuer.
     (b) Subject to Section 7.1.11 of the Credit Agreement, each Grantor has
delivered all Certificated Securities constituting Collateral held by such
Grantor on the Closing Date to the Collateral Agent, together with duly executed
undated blank stock powers, or other equivalent instruments of transfer
reasonably acceptable to the Collateral Agent.
     (c) With respect to Uncertificated Securities constituting Collateral owned
by any Grantor (other than any Capital Securities in a Foreign Subsidiary which
are uncertificated), such Grantor has caused the issuer thereof either to
(i) register the
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Collateral Agent as the registered owner of such security or (ii) agree in an
authenticated record with such Grantor and the Collateral Agent that such issuer
will comply with instructions with respect to such security originated by the
Collateral Agent without further consent of such Grantor.
     (d) Subject to the permitted update to Schedule I pursuant to
Section 7.1.11 of the Credit Agreement, as of the Closing Date, the percentage
of the issued and outstanding Capital Securities of each Subsidiary pledged by
each Grantor hereunder is as set forth on Schedule I.
     SECTION 3.2. Grantor Name, Location, etc.
     (a) As of the Closing Date, the jurisdiction in which each Grantor is
located for purposes of Sections 9–301 and 9–307 of the UCC is set forth in
Item A of Schedule II.
     (b) As of the Closing Date, each Grantor’s organizational identification
number is set forth in Item B of Schedule II.
     (c) During the four months preceding the date hereof, no Grantor has been
known by any legal name different from the one set forth on the signature page
hereto, nor has such Grantor been the subject of any merger or other corporate
reorganization, except as set forth in Item C of Schedule II hereto.
     (d) As of the Closing Date, each Grantor’s federal taxpayer identification
number is (and, during the four months preceding the date hereof, such Grantor
has not had a federal taxpayer identification number different from that) set
forth in Item D of Schedule II hereto.
     (e) As of the Closing Date, no Grantor is a party to any federal, state or
local government contract with a value individually in excess of $2,000,000,
except as set forth in Item E of Schedule II hereto.
     (f) As of the Closing Date, no Grantor maintains any Deposit Accounts
(other than Excluded Accounts), Securities Accounts or Commodity Accounts with
any Person, in each case, except as set forth on Item F of Schedule II.
     (g) As of the Closing Date, no Grantor is the beneficiary of any Letters of
Credit, except as set forth on Item G of Schedule II.
     (h) As of the Closing Date, no Grantor has Commercial Tort Claims (x) in
which a suit has been filed by such Grantor and (y) where the amount of damages
reasonably expected to be claimed individually exceeds $2,000,000, except as set
forth on Item H of Schedule II.
(i) As of the Closing Date, the name set forth on the signature page attached
hereto is the true and correct legal name (as defined in the UCC) of each
Grantor.
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     SECTION 3.3. Ownership, No Liens, etc. Each Grantor owns its Collateral
free and clear of any Lien, except for any security interest (a) created by this
Security Agreement and (b) in the case of Collateral other than Certificated
Securities, a Permitted Lien. No effective UCC financing statement or other
filing similar in effect covering all or any part of the Collateral is on file
in any recording office, except those filed in favor of the Collateral Agent
relating to this Security Agreement, Permitted Liens, filings which have not
been authorized by the applicable Grantor or as to which a duly authorized
termination statement relating to such UCC financing statement or other
instrument has been delivered to the Collateral Agent on the Closing Date.
     SECTION 3.4. Possession of Inventory, Control; etc.
     (a) Each Grantor has, and agrees that it will maintain, exclusive
possession of its Documents, Instruments, Promissory Notes (not otherwise
delivered to the Collateral Agent), Goods, Equipment and Inventory maintained in
the U.S., other than (i) Equipment and Inventory in transit or out for repair or
refurbishing in the ordinary course of business, (ii) Equipment and Inventory
that is in the possession or control of a consignee, warehouseman, bailee agent
or other Person (other than an Affiliate of such Grantor) located in the United
States in the ordinary course of business; provided that, to the extent the fair
market value (as determined in good faith by an Authorized Officer of the
applicable Grantor) in any U.S. location exceeds $5,000,000 and following notice
from the Collateral Agent (at the request of the Required Lenders) following the
occurrence and during the continuance of an Event of Default such Grantor shall
promptly notify such Persons of the security interest created in favor of the
Secured Parties pursuant to this Security Agreement, and such Grantor shall use
commercially reasonable efforts to cause such party to authenticate a record
acknowledging that it holds possession of such Collateral for the Secured
Parties’ benefit and waives or subordinates any Lien held by it against such
Collateral, (iii) Instruments or Promissory Notes that have been delivered to
the Collateral Agent pursuant to Section 3.5 or are not otherwise required to be
delivered hereunder and (iv) such other Documents, Instruments, Promissory
Notes, Goods, Equipment and Inventory with a fair market value (as determined in
good faith by an Authorized Officer of the applicable Grantor) of $2,000,000 in
the aggregate. To each Grantor’s knowledge as of the date hereof, in the case of
Equipment or Inventory described in clause (ii) above, no lessor or warehouseman
of any premises or warehouse upon or in which such Equipment or Inventory is
located has (i) issued any warehouse receipt or other receipt in the nature of a
warehouse receipt in respect of any such Equipment or Inventory, (ii) issued any
Document for any such Equipment or Inventory, (iii) received notification of any
Secured Party’s interest (other than the security interest granted hereunder) in
any such Equipment or Inventory or (iv) any Lien on any such Equipment or
Inventory (other than Permitted Liens).
     (b) Each Grantor is the sole entitlement holder of its Accounts and no
other Person (other than the Collateral Agent pursuant to this Security
Agreement or any other Person with respect to Permitted Liens) has control or
possession of, or any other interest in, any of its Accounts or any other
securities or property credited thereto.
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     SECTION 3.5. Negotiable Documents, Instruments and Chattel Paper. Each
Grantor has delivered to the Collateral Agent possession of all originals of all
Documents, Instruments, Promissory Notes, and tangible Chattel Paper with an
individual fair market value (as determined in good faith by an Authorized
Officer of the applicable Grantor) of at least $2,000,000 owned or held by the
Grantor on the Closing Date.
     SECTION 3.6. Intellectual Property Collateral.
     (a) In respect of the Intellectual Property Collateral as of the Closing
Date:
     (i) set forth in Item A of Schedule III hereto is a complete and accurate
list of all issued and applied-for U.S. Patents owned by the Grantors and set
forth in Item B of Schedule III hereto is a complete and accurate list of all
Patent Licenses;
     (ii) set forth in Item A of Schedule IV hereto is a complete and accurate
list all U.S. registered and applied-for U.S. Trademarks owned by the Grantors,
including those that are registered, or for which an application for
registration has been made, with the United States Patent and Trademark Office
and set forth in Item B of Schedule IV hereto is a complete and accurate list
all Trademark Licenses; and
     (iii) set forth in Item A of Schedule V hereto is a complete and accurate
list of all registered and applied-for U.S. Copyrights owned by the Grantors,
and set forth in Item B of Schedule V hereto is a complete and accurate list of
all Copyright Licenses and a complete and accurate list of all Copyright
Licenses that are exclusive licenses granted to the Grantors in respect of any
Copyright that is registered with the United States Copyright Office.
     (b) Except as disclosed on Schedules III through V, in respect of each
Grantor:
     (i) the Owned Intellectual Property Collateral is valid, subsisting,
unexpired and enforceable (except, in any case, as such enforceability may be
limited by applicable bankruptcy, insolvency, reorganization or similar laws
affecting creditors’ rights generally and by principles of equity) and has not
been abandoned or adjudged invalid or unenforceable (except, in any case, as
such enforceability may be limited by applicable bankruptcy, insolvency,
reorganization or similar laws affecting creditors’ rights generally and by
principles of equity), in whole or in part, except where the loss or expiration
of such Owned Intellectual Property Collateral would not be expected to have a
Material Adverse Effect;
     (ii) such Grantor is the sole and exclusive owner of the entire and
unencumbered right, title and interest in and to the Owned Intellectual Property
Collateral (except for the Permitted Liens) and (A) as of the Closing Date, no
written claim, and (B) following the Closing Date, no written claim which has a
reasonable likelihood of an adverse determination and if adversely determined
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against any Grantor would reasonably be expect to have Material Adverse Effect,
in each case has been made that such Grantor is or may be, in conflict with,
infringing, misappropriating, diluting, misusing or otherwise violating any of
the rights of any third party or that challenges the ownership, use,
protectability, registerability, validity, enforceability of any Owned
Intellectual Property Collateral or, to such Grantor’s knowledge, any other
Intellectual Property Collateral and, to such Grantor’s knowledge neither such
Grantor nor the Intellectual Property Collateral conflict with, infringe,
misappropriate or dilute or otherwise violate the rights of any third party;
     (iii) such Grantor has made all necessary filings and recordations to
protect its interest in any Owned Intellectual Property Collateral that is
material to the operations or business of such Grantor, including recordations
of all of its interests in the Patent Collateral, the Trademark Collateral and
the Copyright Collateral in the United States Patent and Trademark Office, the
United States Copyright Office and any patent, trademark or copyright office
anywhere in the world, as appropriate, and has used proper statutory notice, as
applicable, in connection with its use of any Patent, Trademark or Copyright;
     (iv) such Grantor has taken all commercially reasonable steps to safeguard
its Trade Secrets and to its knowledge (A) none of the Trade Secrets of such
Grantor has been used, divulged, disclosed or appropriated for the benefit of
any other Person other than such Grantor which could reasonably be expected to
result in a Material Adverse Effect; (B) no employee, independent contractor or
agent of such Grantor has misappropriated any Trade Secrets of any other Person
in the course of the performance of his or her duties as an employee,
independent contractor or agent of such Grantor which could reasonably be
expected to result in a Material Adverse Effect; and (C) no employee,
independent contractor or agent of such Grantor is in default or breach of any
term of any employment agreement, non-disclosure agreement, assignment of
inventions agreement or similar agreement or contract relating in any way to the
protection, ownership, development, use or transfer of such Grantor’s
Intellectual Property Collateral, which could reasonably be expected to result
in a Material Adverse Effect;
     (v) no action by such Grantor is currently pending or threatened in writing
which asserts that any third party is infringing, misappropriating, diluting,
misusing or voiding any Owned Intellectual Property Collateral and, to such
Grantor’s knowledge, no third party is infringing upon, misappropriating,
diluting, misusing or voiding any Intellectual Property owned or used by such
Grantor in any material respect, or any of its respective licensees, in each
case except as would not have a Material Adverse Effect;
     (vi) no settlement or consents, covenants not to sue, nonassertion
assurances, or releases have been entered into by such Grantor or to which such
Grantor is bound that adversely affects its rights to own or use any material
Intellectual Property Collateral;
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     (vii) except for the Permitted Liens, such Grantor has not made a previous
assignment, sale, transfer or agreement constituting a present or future
assignment, sale or transfer of any Intellectual Property Collateral for
purposes of granting a security interest or as collateral that has not been
terminated or released;
     (viii) such Grantor has executed and delivered to the Collateral Agent,
Intellectual Property Collateral security agreements for all Copyrights, Patents
and Trademarks owned by such Grantor that constitute Collateral, including all
Copyrights, Patents and Trademarks on Schedules III, IV or V (as such schedules
may be amended or supplemented from time to time);
     (ix) such Grantor uses adequate standards of quality in the manufacture,
distribution, and sale of all products sold and in the provision of all services
rendered under or in connection with any Trademarks and has taken all
commercially reasonable action necessary to ensure that all licensees of any
Trademarks owned by such Grantor use such adequate standards of quality, in each
case except as would not have a Material Adverse Effect;
     (x) the consummation of the transactions contemplated by the Credit
Agreement and this Security Agreement will not result in the termination or
material impairment of any of the Intellectual Property Collateral necessary for
the conduct of such Grantor’s business;
     (xi) all employees, independent contractors and agents who have contributed
to the creation or development of any Owned Intellectual Property Collateral
have been a party to an enforceable assignment agreement with such Grantor in
accordance with applicable laws, according and granting exclusive ownership of
such Owned Intellectual Property Collateral to such Grantor, in each case except
as could not reasonably be expected to have a Material Adverse Effect; and
     (xii) such Grantor owns directly or is entitled to use by license or
otherwise, all Intellectual Property Collateral with respect to any of the
foregoing reasonably necessary for such Grantor’s business, in each case except
as could not reasonably be expected to have a Material Adverse Effect.
     Notwithstanding anything contained herein to the contrary, it is understood
and agreed that (A) after the consummation of the IP Purchase, the Grantors
shall be the owners of all the rights, title and interests in, to and under the
Intellectual Property Collateral and (B)the Grantors’ interests in such
Intellectual Property Collateral will not be recorded at the applicable filing
offices as of the Closing Date, but shall be filed in such filing offices no
later than five Business Days following the Closing Date.
     SECTION 3.7. Validity, etc.
     (a) This Security Agreement creates a valid security interest in the
Collateral securing the payment of the Secured Obligations.
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     (b) Each Grantor has filed or caused to be filed all UCC-1 financing
statements listing the Collateral Agent as “Secured Party” in the filing office
for each Grantor’s jurisdiction of organization listed in Item A of Schedule II
(collectively, the “Filing Statements”) (or has authorized the Administrative
Agent to file the Filing Statements suitable for timely and proper filing in
such offices) and has taken all other:
     (i) actions necessary to obtain control of the Collateral (to the extent
required herein or in the Credit Agreement) as provided in Sections 9-104,
9-105, 9-106 and 9-107 of the UCC; and
     (ii) actions necessary to perfect the Collateral Agent’s security interest
with respect to any Collateral with a fair market value (as determined in good
faith by an Authorized Officer of the applicable Grantor) individually valued in
excess of $75,000 evidenced by a Certificate of Title.
     (c) Upon the filing of the Filing Statements with the appropriate agencies
therefor the security interests created under this Security Agreement shall
constitute a perfected security interest in the Collateral described on such
Filing Statements in favor of the Collateral Agent on behalf of the Secured
Parties to the extent that a security interest therein may be perfected by
filing pursuant to the relevant UCC, prior to all other Liens, except for
Permitted Liens.
     SECTION 3.8. Authorization, Approval, etc. Except as have been obtained or
made and are in full force and effect, no authorization, approval or other
action by, and no notice to or filing with, any Governmental Authority or any
other third party is required either
     (a) for the grant by the Grantors of the security interest granted hereby
or for the execution, delivery and performance of this Security Agreement by the
Grantors;
     (b) for the perfection or maintenance of the security interests hereunder
including the first priority (subject to Permitted Liens) nature of such
security interest to the extent each Grantor is required to perfect a security
interest hereunder in such Collateral (except with respect to the Filing
Statements or, with respect to Owned Intellectual Property Collateral, the
recordation of any agreements with the United States Patent and Trademark Office
or the United States Copyright Office) or the exercise by the Collateral Agent
of its rights and remedies hereunder; or
     (c) for the exercise by the Collateral Agent of the voting or other rights
provided for in this Security Agreement, or, except (i) with respect to any
securities issued by a Subsidiary of the Grantors, as may be required in
connection with a disposition of such securities by laws affecting the offering
and sale of securities generally, the remedies in respect of the Collateral
pursuant to this Security Agreement, (ii) any “change of control” or similar
filings required by state licensing agencies and (iii) with respect to any
interest in a limited liability company, as may be required to become a member
and/or vote such interest.
     SECTION 3.9. Best Interests. It is in the best interests of each Grantor
(other than the Borrower) to execute this Security Agreement inasmuch as such
Grantor will, as a result of being
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a Subsidiary of the Borrower, derive substantial direct and indirect benefits
from the Credit Extensions made from time to time to the Borrower by the Lenders
and the Issuer pursuant to the Credit Agreement, and each Grantor acknowledges
that the Secured Parties are relying on this representation in agreeing to make
such Credit Extensions pursuant to the Credit Agreement to the Borrower.
ARTICLE IV
COVENANTS
     Each Grantor covenants and agrees that, until the Termination Date, such
Grantor will perform, comply with and be bound by the obligations set forth
below.
     SECTION 4.1. As to Investment Property, etc.
     SECTION 4.1.1. Capital Securities of Subsidiaries. No Grantor will allow
any of its U.S. Subsidiaries:
     (a) that is a corporation, business trust, joint stock company or similar
Person, after the date hereof to issue Uncertificated Securities;
     (b) that is a partnership or limited liability company, to (i) issue
Capital Securities that are to be dealt in or traded on securities exchanges or
in securities markets, (ii) expressly provide in its Organic Documents that its
Capital Securities are securities governed by Article 8 of the UCC unless such
Capital Securities have been delivered to the Collateral Agent on the Closing
Date or, to the extent such Organic Documents are modified to provide that such
Capital Securities are securities governed by Article 8 of the UCC such Capital
Securities, together with duly executed undated blank instruments of transfer
reasonably acceptable to the Collateral Agent, are delivered to the Collateral
Agent on or prior to the date of such modification, or (iii) place such
Subsidiary’s Capital Securities in a Securities Account unless such Securities
Account is subject to a Control Agreement; and
     (c) to issue Capital Securities in addition to or in substitution for the
Capital Securities pledged hereunder, except to such Grantor (and such Capital
Securities are immediately pledged and delivered to the Collateral Agent
pursuant to the terms of this Security Agreement).
     SECTION 4.1.2. Investment Property (other than Certificated Securities).
     (a) Other than Excluded Accounts, with respect to any Deposit Accounts,
Securities Accounts, Commodity Accounts, Commodity Contracts or Security
Entitlements constituting Investment Property owned or held by any Grantor with
an intermediary who is not a Secured Party, such Grantor will, upon notice from
the Collateral Agent (at the request of the Required Lenders) following the
occurrence and during the continuance of an Event of Default, take commercially
reasonable efforts to cause the intermediary maintaining such Investment
Property to execute a Control Agreement relating to such Investment Property
pursuant to which such intermediary agrees to comply with the Collateral Agent’s
instructions with respect to such Investment
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Property upon the Collateral Agent’s notice of sole control following the
occurrence and during the continuance of an Event of Default; provided that the
Administrative Agent agrees to instruct the Collateral Agent to promptly rescind
such notice upon the cure or waiver of all Events of Default.
     (b) With respect to any Uncertificated Securities (other than
Uncertificated Securities credited to a Securities Account and any Capital
Securities in a Foreign Subsidiary which are uncertificated) constituting
Investment Property owned or held by any Grantor, such Grantor will take
commercially reasonable efforts to cause the issuer of such securities to either
(i) register the Collateral Agent as the registered owner thereof on the books
and records of the issuer or (ii) execute a Control Agreement relating to such
Investment Property pursuant to which the issuer agrees to comply with the
Collateral Agent’s instructions with respect to such Uncertificated Securities
upon notice of sole control following the occurrence and during the continuance
of an Event of Default; provided that the Administrative Agent agrees to
instruct the Collateral Agent to promptly rescind such notice upon the cure or
waiver of all Events of Default.
     SECTION 4.1.3. Certificated Securities (Stock Powers). Subject to
Section 7.1.11 of the Credit Agreement and applicable local law regarding the
retention of certificates representing Equity Interests in the appropriate
jurisdiction, each Grantor agrees that all Certificated Securities, including
the Capital Securities delivered by such Grantor pursuant to this Security
Agreement, will be accompanied by duly executed undated blank stock powers, or
other equivalent instruments of transfer reasonably acceptable to the Collateral
Agent.
     SECTION 4.1.4. Continuous Pledge. Subject to Section 7.1.11 of the Credit
Agreement and applicable local law regarding the retention of certificates
representing Equity Interests in the appropriate jurisdiction, each Grantor will
(subject to the terms of the Credit Agreement and the requirements hereunder)
deliver to the Collateral Agent and at all times keep pledged to the Collateral
Agent pursuant hereto, on a first priority, perfected basis (subject to
Permitted Liens) in accordance with all applicable U.S. laws, all Investment
Property, all Dividends and Distributions with respect thereto, all Payment
Intangibles to the extent they are evidenced by a Document, Instrument,
Promissory Note or Chattel Paper, and all interest and principal with respect to
such Payment Intangibles, and all Proceeds and rights from time to time received
by or distributable to such Grantor in respect of any of the foregoing, in each
case to the extent such asset constitutes Collateral. Each Grantor agrees that
it will, promptly following receipt thereof, deliver to the Collateral Agent
possession of all originals of negotiable Documents, Instruments, Promissory
Notes and Chattel Paper that it acquires following the Closing Date to the
extent otherwise required hereunder.
     SECTION 4.1.5. Voting Rights; Dividends, etc. Each Grantor agrees promptly
upon receipt of notice from the Administrative Agent of the Administrative
Agent’s or Collateral Agent’s intent to seek remedies under this Section 4.1.5
after the occurrence and continuance of a Specified Default:
     (a) so long as such Specified Default shall continue, to deliver (properly
endorsed where required hereby or requested by the Administrative Agent) to the
Collateral Agent all Dividends and Distributions with respect to Investment
Property
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constituting Collateral, all interest, principal, other cash payments on Payment
Intangibles, and all Proceeds of the Collateral, in each case thereafter
received by such Grantor, all of which shall be held by the Collateral Agent as
additional Collateral; and
     (b) with respect to Collateral consisting of general partner interests or
limited liability company interests, upon the occurrence and continuance of a
Specified Default and so long as the Collateral Agent has notified such Grantor
of the Collateral Agent’s intention to exercise its voting power (pursuant to
the written direction of the Administrative Agent) under this clause,
     (i) that the Collateral Agent may exercise (to the exclusion of such
Grantor) the voting power and all other incidental rights of ownership with
respect to any Investment Property constituting Collateral and such Grantor
hereby grants the Collateral Agent an irrevocable proxy, exercisable under such
circumstances, to vote such Investment Property; and
     (ii) to promptly deliver to the Collateral Agent such additional proxies
and other documents as may be necessary to allow the Collateral Agent to
exercise such voting power.
All dividends, Distributions, interest, principal, cash payments, Payment
Intangibles and Proceeds that may at any time and from time to time be held by
such Grantor, but which such Grantor is then obligated to deliver to the
Collateral Agent, shall, until delivery to the Collateral Agent, be held by such
Grantor separate and apart from its other property for the benefit of the
Collateral Agent. The Collateral Agent agrees that unless a Specified Default
shall have occurred and be continuing and the Collateral Agent shall have given
the notice referred to in clause (b), such Grantor will have the exclusive
voting power with respect to any Investment Property constituting Collateral and
the Collateral Agent will, upon the written request of such Grantor, promptly
deliver such proxies and other documents, if any, as shall be reasonably
requested by such Grantor which are necessary to allow such Grantor to exercise
that voting power; provided that no vote shall be cast, or consent, waiver, or
ratification given, or action taken by such Grantor that would impair any such
Collateral (except to the extent expressly permitted by the Credit Agreement) or
be inconsistent with or violate any provision of any Loan Document. After any
and all Events of Default have been cured or waived, (i) each Grantor shall have
the right to exercise the voting, managerial and other consensual rights and
powers that it would otherwise be entitled to pursuant to this Section 4.1.5 and
receive the payments, proceeds, dividends, distributions, monies, compensation,
property, assets, instruments or rights which it would be authorized to receive
and retain pursuant to this Section 4.1.5 and (ii) within ten Business Days
after notice of such cure or waiver, the Collateral Agent shall repay and
deliver to each Grantor all cash and monies that such Grantor is entitled to
retain pursuant to this Section 4.1.5 which was not applied in repayment of the
Secured Obligations.
     SECTION 4.2. Change of Name, etc. No Grantor will change its legal name,
place of incorporation or organization, federal taxpayer identification number
or organizational identification number except upon 15 days’ prior written
notice to the Collateral Agent.
     SECTION 4.3. As to Accounts.
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     (a) Each Grantor shall have the right to collect all Accounts so long as
(i) no Specified Default shall have occurred and be continuing and (ii) notice
pursuant to clause (b) has not been delivered.
     (b) Upon (i) the occurrence and continuance of a Specified Default and
(ii) the delivery of notice by the Collateral Agent (at the direction of the
Administrative Agent) to each Grantor, all Proceeds of Collateral received by
such Grantor shall be delivered in kind to the Collateral Agent for deposit in a
Deposit Account of such Grantor maintained with the Collateral Agent (together
with any other Accounts pursuant to which any portion of the Collateral is
deposited with the Collateral Agent, the “Collateral Accounts”), and such
Grantor shall not commingle any such Proceeds, and shall hold separate and apart
from all other property, all such Proceeds for the benefit of the Collateral
Agent until delivery thereof is made to the Collateral Agent.
     (c) Following the delivery of notice pursuant to clause (b)(ii), the
Collateral Agent shall apply any amount in the Collateral Account in accordance
with Section 4.7 of the Credit Agreement.
     (d) With respect to each of the Collateral Accounts, it is hereby confirmed
and agreed that (i) deposits in such Collateral Account are subject to a
security interest as contemplated hereby, (ii) such Collateral Account shall be
under the control of the Collateral Agent and (iii) the Collateral Agent shall
have the sole right of withdrawal over such Collateral Account.
     SECTION 4.4. As to Grantors Use of Collateral.
     (a) Subject to clause (b), each Grantor (i) may in the ordinary course of
its business, at its own expense, subject to Section 7.2.11 of the Credit
Agreement, dispose of and use any Collateral, (ii) subject to the applicable
terms of the Credit Agreement, will, at its own expense, endeavor to collect, as
and when due, all amounts due with respect to any of the Collateral, including
the taking of such action with respect to such collection as the Collateral
Agent may reasonably request following the occurrence and continuance of a
Specified Default or, in the absence of such request, as such Grantor may deem
advisable, and (iii) may grant, in the ordinary course of business, to any party
obligated on any of the Collateral, any rebate, refund, set off or allowance to
which such party may be lawfully entitled or which may lawfully be allowed by
such Grantor.
     (b) At any time following the occurrence and during the continuance of a
Specified Default, whether before or after the maturity of any of the Secured
Obligations, the Collateral Agent may, acting at the direction of the Required
Lenders, (i) revoke any or all of the rights of each Grantor set forth in clause
(a), (ii) with two Business Days prior notice to the applicable Grantor, notify
any parties obligated on any of the Collateral to make payment to the Collateral
Agent of any amounts due or to become due thereunder and (iii) with two Business
Days prior notice to the applicable Grantor, enforce collection of any of the
Collateral by suit or otherwise and surrender, release, or exchange all or any
part thereof, or compromise or extend or renew for any period
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     (whether or not longer than the original period) any indebtedness
thereunder or evidenced thereby.
     (c) Upon the reasonable request of the Administrative Agent following the
occurrence and during the continuance of a Specified Default, each Grantor will,
at its own expense, promptly notify any parties obligated on any of the
Collateral to make payment to the Collateral Agent of any amounts due or to
become due thereunder.
     (d) At any time following the occurrence and during the continuation of a
Specified Default, the Collateral Agent may endorse, in the name of such
Grantor, any item, howsoever received by the Collateral Agent, representing any
payment on or other Proceeds of any of the Collateral.
     SECTION 4.5. As to Intellectual Property Collateral. Each Grantor covenants
and agrees to comply with the following provisions as such provisions relate to
any Intellectual Property Collateral (except for the tangible components of the
Computer Hardware and Software Collateral) material to the operations or
business of such Grantor:
     (a) such Grantor will not, and will not knowingly permit any third party or
licensee to, (i) do or permit any act or knowingly omit to do any act whereby
any of the Patent Collateral may lapse or become abandoned or dedicated to the
public or unenforceable except upon expiration of the end of an unrenewable term
of a registration thereof or as otherwise permitted by the Credit Agreement,
(ii) fail to maintain as in the past the quality of products and services
offered under the Trademark Collateral, (iii) fail to employ the Trademark
Collateral registered with any federal or state or foreign authority with an
appropriate notice of such registration, (iv) do or permit any act or knowingly
omit to do any act whereby any of the Trademark Collateral may lapse or become
invalid or unenforceable, or (v) do or permit any act or knowingly omit to do
any act whereby any of the Copyright Collateral or any of the Trade Secrets
Collateral may lapse or become invalid or unenforceable or placed in the public
domain except upon expiration of the end of an unrenewable term of a
registration thereof, unless, in the case of any of the foregoing requirements
in clauses (i) through (v), (x) such Grantor shall reasonably and in good faith
determine that any of such Intellectual Property Collateral is of negligible
economic value to such Grantor or (y) the loss of such Intellectual Property
Collateral would not have a Material Adverse Effect;
     (b) such Grantor shall not permit any third party or licensee to adopt or
use any other Trademark which is confusingly similar or a colorable imitation of
any of the Trademark Collateral unless, (x) such Grantor shall reasonably and in
good faith determine that any of such Intellectual Property Collateral is of
negligible economic value to such Grantor or (y) the loss of such Intellectual
Property Collateral would not have a Material Adverse Effect;
     (c) unless otherwise permitted by the Credit Agreement, such Grantor shall
promptly notify the Collateral Agent if it knows that any application or
registration relating to any material item of the Intellectual Property
Collateral (except for the tangible components of the Computer Hardware and
Software Collateral) has a
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reasonable likelihood of becoming abandoned or dedicated to the public or placed
in the public domain or invalid or unenforceable, or of any adverse
determination (including the institution of, or any such determination or
development in, any proceeding in the United States Patent and Trademark Office,
the United States Copyright Office) regarding such Grantor’s ownership of any
Intellectual Property Collateral, its right to register the same or to keep and
maintain and enforce the same;
     (d) concurrently with the delivery of a Compliance Certificate pursuant to
clause (c) of Section 7.1.1 of the Credit Agreement, each Grantor that has,
since the date the Compliance Certificate was last delivered, (i) filed an
application for the registration of any Patent or Trademark with the United
States Patent and Trademark Office or (ii) received, as owner or exclusive
licensee, a Copyright registration with the United States Copyright, in each
case to the extent such Intellectual Property constitutes Collateral, shall
inform the Administrative Agent, and upon request of the Administrative Agent,
promptly execute and deliver an Intellectual Property Security Agreement
substantially in the form set forth as Exhibits A, B and C hereto and other
documents as the Administrative Agent may reasonably request to evidence the
Collateral Agent’s security interest in such Intellectual Property Collateral;
     (e) such Grantor will take all commercially reasonable steps, including in
any proceeding before the United States Patent and Trademark Office the United
States Copyright Office, to maintain and pursue any application (and to obtain
the relevant registration) filed with respect to, and to maintain any
registration of, the Owned Intellectual Property Collateral, including the
filing of applications for renewal, affidavits of use, affidavits of
incontestability and opposition, interference and cancellation proceedings and
the payment of fees and taxes (except to the extent that dedication, abandonment
or invalidation is permitted under the Credit Agreement or under the foregoing
clause (a) or (b)); and
     (f) concurrently with the delivery of a Compliance Certificate pursuant to
clause (c) of Section 7.1.1 of the Credit Agreement, each Grantor that has
obtained, since the date the Compliance Certificate was last delivered, an
ownership interest in any Patent, Copyright or Trademark, in each case to the
extent such Intellectual Property constitutes Collateral, shall execute and
deliver to the Collateral Agent a Patent Security Agreement, Copyright Security
Agreement or a Trademark Security Agreement in the form of Exhibit A, Exhibit B
or Exhibit C, as applicable, and in each case such Grantor shall execute and
deliver to the Collateral Agent any other document required to acknowledge or
register, record or perfect the Collateral Agent’s security interest in any part
of such item of Intellectual Property unless such Grantor shall otherwise
determine in good faith using its commercially reasonable business judgment that
any such Intellectual Property is not material.
     SECTION 4.6. As to Letter-of-Credit Rights.
     (a) Each Grantor, by granting a security interest in its Letter-of-Credit
Rights to the Collateral Agent, intends to (and hereby does) collaterally assign
to the Collateral Agent its rights (including its contingent rights ) to the
Proceeds of all individual Letter-of-Credit
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Rights in excess of $2,000,000 of which it is or hereafter becomes a beneficiary
or assignee. Such Grantor will promptly use its commercially reasonable efforts
to cause the issuer of each such Letter of Credit and each nominated person (if
any) with respect thereto to consent to such assignment of the Proceeds thereof
in a consent agreement in form and substance reasonably satisfactory to the
Collateral Agent and deliver written evidence of such consent to the Collateral
Agent.
     (b) Upon the occurrence and during the continuance of a Specified Default,
such Grantor will, promptly upon request by the Administrative Agent, (i) notify
(and such Grantor hereby authorizes the Administrative Agent to notify) the
issuer and each nominated person with respect to each of the Letters of Credit
that the Proceeds thereof have been assigned to the Collateral Agent hereunder
and any payments due or to become due in respect thereof are to be made directly
to the Collateral Agent and (ii) use commercially reasonable effort to arrange
for the Collateral Agent to become the transferee beneficiary Letter of Credit.
     SECTION 4.7. As to Commercial Tort Claims. Each Grantor covenants and
agrees that, until the occurrence of the Termination Date, with respect to any
Commercial Tort Claim in excess of $2,000,000 individually hereafter arising, it
shall promptly deliver to the Collateral Agent a revised Item H of Schedule II
identifying such new Commercial Tort Claims.
     SECTION 4.8. Electronic Chattel Paper and Transferable Records. If any
Grantor at any time holds or acquires an interest in any electronic chattel
paper or any “transferable record,” as that term is defined in Section 201 of
the U.S. Federal Electronic Signatures in Global and National Commerce Act, or
in Section 16 of the U.S. Uniform Electronic Transactions Act as in effect in
any relevant jurisdiction, with a value in excess of $2,000,000, such Grantor
shall promptly notify the Administrative Agent thereof and, at the reasonable
request of the Administrative Agent, shall take such action as the
Administrative Agent may request to vest in the Collateral Agent control under
Section 9-105 of the UCC of such electronic chattel paper or control under
Section 201 of the Federal Electronic Signatures in Global and National Commerce
Act or, as the case may be, Section 16 of the Uniform Electronic Transactions
Act, as so in effect in such jurisdiction, of such transferable record. The
Collateral Agent agrees with such Grantor that the Collateral Agent will allow,
pursuant to procedures reasonably satisfactory to the Collateral Agent and so
long as such procedures will not result in the Collateral Agent’s loss of
control, the Grantor to make alterations to the electronic chattel paper or
transferable record permitted under Section 9-105 of the UCC or, as the case may
be, Section 201 of the U.S. Federal Electronic Signatures in Global and National
Commerce Act or Section 16 of the U.S. Uniform Electronic Transactions Act for a
party in control to allow without loss of control, unless an Event of Default
has occurred and is continuing or would occur after taking into account any
action by such Grantor with respect to such electronic chattel paper or
transferable record.
     SECTION 4.9. Further Assurances, etc. Each Grantor agrees that, from time
to time at its own expense, it will promptly execute and deliver all further
instruments and documents, and take all further action, that is necessary, in
order to perfect, preserve and protect any security interest granted or
purported to be granted hereby or to enable the Collateral Agent to exercise
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and enforce its rights and remedies hereunder with respect to any Collateral.
Without limiting the generality of the foregoing, such Grantor will
     (a) from time to time upon the reasonable request of the Administrative
Agent or the Collateral Agent, (i) promptly deliver to the Collateral Agent such
stock powers, instruments and similar documents, reasonably satisfactory in form
and substance to the Administrative Agent, with respect to such Collateral as
the Administrative Agent may request and (ii) after the occurrence and during
the continuance of any Specified Default, transfer any securities constituting
Collateral into the name of any nominee designated by the Collateral Agent; if
any Collateral shall be evidenced by an Instrument, negotiable Document,
Promissory Note or tangible Chattel Paper and such Collateral, individually, has
a fair market value (as determined in good faith by an Authorized Officer of the
applicable Grantor) in excess of $2,000,000, promptly deliver and pledge to the
Collateral Agent hereunder such Instrument, negotiable Document, Promissory Note
or tangible Chattel Paper duly endorsed and accompanied by duly executed
instruments of transfer or assignment, all in form and substance reasonably
satisfactory to the Collateral Agent;
     (b) file (and hereby authorize the Administrative Agent to file) such
Filing Statements or continuation statements, or amendments thereto, and such
other instruments or notices (including any assignment of claim form under or
pursuant to the federal assignment of claims statute, 31 U.S.C. § 3726, any
successor or amended version thereof or any regulation promulgated under or
pursuant to any version thereof), as shall be necessary that the Administrative
Agent may reasonably request in order to perfect and preserve the security
interests and other rights granted or purported to be granted to the Collateral
Agent hereby;
     (c) promptly deliver to the Collateral Agent and at all times keep pledged
to the Collateral Agent pursuant hereto, on a first priority, perfected basis
(subject to Permitted Liens), at the request of the Administrative Agent, all
Investment Property constituting Collateral, all Dividends and Distributions
with respect thereto, and all interest and principal with respect to Promissory
Notes, and all Proceeds and rights from time to time received by or
distributable to such Grantor in respect of any of the foregoing Collateral;
     (d) not take or omit to take any action the taking or the omission of which
would result in any impairment or alteration of any obligation of the maker of
any Payment Intangible or other Instrument constituting Collateral, except as
provided in Section 4.4 or in the Credit Agreement;
     (e) upon the reasonable request of the Administrative Agent, place a legend
reasonably acceptable to the Administrative Agent indicating that the Collateral
Agent has a security interest in any tangible Chattel Paper;
     (f) furnish to the Collateral Agent, from time to time at the
Administrative Agent’s reasonable request, statements and schedules further
identifying and describing
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the Collateral and such other reports in connection with the Collateral as the
Administrative Agent may reasonably request, all in reasonable detail; and
     (g) comply with the reasonable requests of the Collateral Agent and the
Administrative Agent in accordance with this Security Agreement in order to
enable the Collateral Agent to have and maintain control over the Collateral
consisting of Investment Property, Deposit Accounts, Letter-of-Credit-Rights and
Electronic Chattel Paper to the extent required herein.
     With respect to the foregoing and the grant of the security interest
hereunder, each Grantor hereby authorizes the Administrative Agent or Collateral
Agent to file one or more financing or continuation statements, and amendments
thereto, relative to all or any part of the Collateral; and to make all relevant
filings with the United States Patent and Trademark Office and the United States
Copyright Office in respect of the Intellectual Property Collateral, in each
case naming the Collateral Agent as “Secured Party” (or other similar term).
Each Grantor agrees that a carbon, photographic or other reproduction of this
Security Agreement or any UCC financing statement covering the Collateral or any
part thereof shall be sufficient as a UCC financing statement where permitted by
law. Each Grantor hereby authorizes the Administrative Agent to file financing
statements describing as the collateral covered thereby “all of the debtor’s
personal property or assets”, “all assets”, “all personal property” or words to
that effect, notwithstanding that such wording may be broader in scope than the
Collateral described in this Security Agreement.
     SECTION 4.10. Deposit Accounts. Promptly following the occurrence and
during the continuance of a Specified Default, at the request of the Collateral
Agent (at the direction of the Administrative Agent), such Grantor will maintain
all of its Deposit Accounts only with the Collateral Agent or with any
depositary institution that has entered into a Control Agreement in favor of the
Collateral Agent. Such Control Agreements shall permit the Collateral Agent (at
the written instructions of the Administrative Agent) to deliver a notice of
sole exclusive control during the continuance of an Event of Default. To the
extent the Collateral Agent (at the written instructions of the Administrative
Agent) has delivered a notice of sole control with respect to any such Deposit
Accounts pursuant to a Control Agreement, the Administrative Agent agrees
promptly to notify (no later than 2 Business Days) all such depository banks
that the notice of exclusive control has been rescinded and the applicable
Grantor shall have the right to withdraw funds from such Deposit Account(s)
following the cure or waiver of all Specified Defaults.
ARTICLE V
THE COLLATERAL AGENT
     SECTION 5.1. Collateral Agent Appointed Attorney in Fact. Until the
Termination Date, each Grantor hereby irrevocably appoints the Collateral Agent
as its attorney in fact, with full authority in the place and stead of such
Grantor and in the name of such Grantor or otherwise, from time to time as
directed by the Administrative Agent, following the occurrence and during the
continuance of a Specified Default, to take any action and to execute any
instrument which is necessary to accomplish the purposes of this Security
Agreement, including:
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     (a) with two Business Days prior notice to the applicable Grantor, to ask,
demand, collect, sue for, recover, compromise, receive and give acquittance and
receipts for moneys due and to become due under or in respect of any of the
Collateral;
     (b) to receive, endorse, and collect any drafts or other Instruments,
Documents and Chattel Paper, in connection with clause (a) above;
     (c) to file any claims or take any action or institute any proceedings
which the Administrative Agent may deem necessary or desirable for the
collection of any of the Collateral or otherwise to enforce the rights of the
Collateral Agent with respect to any of the Collateral; and
     (d) to perform the affirmative obligations of such Grantor hereunder.
          Each Grantor hereby acknowledges, consents and agrees that the power
of attorney granted pursuant to this Section is irrevocable and coupled with an
interest.
     SECTION 5.2. Collateral Agent May Perform. If any Grantor fails to perform
any agreement contained herein and the Administrative Agent provides prior
notice to such Grantor of such failure, within three days of such notice, the
Grantor shall perform, cause to be performed or agree to perform (and thereafter
actually perform within seven days after such notice) such agreement, the
Collateral Agent may (but shall have not obligation to) itself perform, or cause
performance of, such agreement, and the expenses of the Collateral Agent
incurred in connection therewith shall be payable by such Grantor pursuant to
Section 10.3 of the Credit Agreement.
     SECTION 5.3. Collateral Agent Has No Duty. The powers conferred on the
Collateral Agent hereunder are solely to protect its interest (on behalf of the
Secured Parties) in the Collateral and shall not impose any duty on it to
exercise any such powers. Except for reasonable care of any Collateral in its
possession, the accounting for moneys actually received by it hereunder and,
except to the extent of the gross negligence, bad faith or willful misconduct of
the Collateral Agent or any of its respective officers, directors, employees or
agents, the Collateral Agent shall have no duty as to any Collateral or
responsibility for
     (a) ascertaining or taking action with respect to calls, conversions,
exchanges, maturities, tenders or other matters relative to any Investment
Property, whether or not the Collateral Agent has or is deemed to have knowledge
of such matters, or
     (b) taking any necessary steps to preserve rights against prior parties or
any other rights pertaining to any Collateral.
     SECTION 5.4. Reasonable Care. The Collateral Agent is required to exercise
reasonable care in the custody and preservation of any of the Collateral in its
possession; provided that the Collateral Agent shall be deemed to have exercised
reasonable care in the custody and preservation of any of the Collateral, if
(i) such Collateral is accorded treatment substantially equal to that which the
Collateral Agent accords its own property or (ii) it takes such action for that
purpose as each Grantor reasonably requests in writing at times other than upon
the occurrence and during the continuance of any Specified Default, but failure
of the
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Collateral Agent to comply with any such request at any time shall not in itself
be deemed a failure to exercise reasonable care.
     SECTION 5.5. Liability.
     (a) No provision of this Security Agreement shall require the Collateral
Agent to expend or risk its own funds or otherwise incur any financial liability
in the performance of any of its duties hereunder, or in the exercise of any of
its rights or powers and the Collateral Agent shall not be liable or responsible
for any loss or diminution in the value of any of the Collateral.
     (b) In no event shall the Collateral Agent be responsible or liable for
special, indirect, or consequential loss or damage of any kind whatsoever
(including, but not limited to, loss of profit) irrespective of whether the
Collateral Agent has been advised of the likelihood of such loss or damage and
regardless of the form of action.
     SECTION 5.6. Force Majeure. In no event shall the Collateral Agent be
responsible or liable for any failure or delay in the performance of its
obligations hereunder arising out of or caused by, directly or indirectly,
forces beyond its control, including, without limitation, strikes, work
stoppages, accidents, acts of war or terrorism, civil or military disturbances,
nuclear or natural catastrophes or acts of God, and interruptions, loss or
malfunctions of utilities, communications or computer (software and hardware)
services; it being understood that the Collateral Agent shall use reasonable
efforts which are consistent with accepted practices in the banking industry to
resume performance as soon as practicable under the circumstances.
ARTICLE VI
REMEDIES
     SECTION 6.1. Certain Remedies. If any Specified Default shall have occurred
and be continuing and the Administrative Agent shall have given written notice
to the relevant Grantor of the Collateral Agent’s intent to exercise its
corresponding rights pursuant to this Section:
     (a) The Collateral Agent may exercise in respect of the Collateral, in
addition to other rights and remedies provided for herein or otherwise available
to it, all the rights and remedies of a Secured Party on default under the UCC
(whether or not the UCC applies to the affected Collateral) and also may to the
extent permitted by applicable law:
     (i) take possession of any Collateral not already in its possession without
demand and without legal process;
     (ii) require each Grantor to, and each Grantor hereby agrees that it will,
at its expense and upon request of the Collateral Agent forthwith, assemble all
or part of the Collateral as directed by the Collateral Agent and make it
available to the Collateral Agent at a place to be designated by the Collateral
Agent that is reasonably convenient to both parties;
     (iii) enter onto the property where any Collateral is located and take
possession thereof without demand and without legal process; and
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     (iv) without notice except as specified below and to the extent permitted
by applicable law, lease, or license, sell or otherwise dispose of the
Collateral or any part thereof in one or more parcels at public or private sale,
at any of the Collateral Agent’s offices or elsewhere, for cash, on credit or
for future delivery, and upon such other terms as the Collateral Agent, at the
direction of the Administrative Agent, may deem commercially reasonable. Each
Grantor agrees that, to the extent notice of sale shall be required by law, at
least ten days’ prior notice to such Grantor of the time and place of any public
sale or the time after which any private sale is to be made shall constitute
reasonable notification. The Collateral Agent shall not be obligated to make any
sale of Collateral regardless of notice of sale having been given. The
Collateral Agent may adjourn any public or private sale from time to time by
announcement at the time and place fixed therefor, and such sale may, without
further notice, be made at the time and place to which it was so adjourned.
     (b) All cash Proceeds received by the Collateral Agent in respect of any
sale of, collection from, or other realization upon, all or any part of the
Collateral shall be applied by the Collateral Agent in accordance with
Section 4.7 of the Credit Agreement.
     (c) The Collateral Agent may
     (i) transfer all or any part of the Collateral into the name of the
Collateral Agent or its nominee, with or without disclosing that such Collateral
is subject to the Lien hereunder;
     (ii) with two Business Days prior notice to the applicable Grantor, notify
the parties obligated on any of the Collateral to make payment to the Collateral
Agent of any amount due or to become due thereunder;
     (iii) withdraw, or cause or direct the withdrawal, of all funds with
respect to the Collateral Account to repay the Secured Obligations or otherwise
apply such funds in accordance with Section 4.7 of the Credit Agreement;
     (iv) enforce collection of any of the 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
obligations of any nature of any party with respect thereto;
     (v) endorse any checks, drafts, or other writings in any Grantor’s name to
allow collection of the Collateral;
     (vi) take control of any Proceeds of the Collateral; and
     (vii) execute (in the name, place and stead of any Grantor) endorsements,
assignments, stock powers and other instruments of conveyance or transfer with
respect to all or any of the Collateral;
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     (d) Without limiting the foregoing, in respect of the Intellectual Property
Collateral:
     (i) upon the request of the Administrative Agent, such Grantor shall
execute and deliver to the Collateral Agent an assignment or assignments of the
Intellectual Property Collateral, subject (in the case of any licenses
thereunder) to any valid and enforceable requirements to obtain consents from
any third parties, and such other documents as are necessary or appropriate to
carry out the intent and purposes hereof;
     (ii) the Administrative Agent shall have the right, in its sole discretion,
(which right shall take precedence over any right or action of any Grantor) to
file applications and maintain registrations for the protection of the
Intellectual Property Collateral and/or bring suit in the name of such Grantor,
the Collateral Agent or any Secured Party to enforce the Intellectual Property
Collateral and any licenses thereunder and, upon the request of the
Administrative Agent, such Grantor shall use all commercially reasonable efforts
to assist with such filing or enforcement (including the execution of relevant
documents); and
     (iii) in the event that the Collateral Agent elects not to make any filing
or bring any suit as set forth in clause (ii), such Grantor shall, upon the
request of Collateral Agent, use all commercially reasonable efforts, whether
through making appropriate filings or bringing suit or otherwise, to protect,
enforce and prevent the infringement, misappropriation, dilution, unauthorized
use or other violation of the Intellectual Property Collateral.
     Notwithstanding the foregoing provisions of this Section 6.1, for the
purposes of this Section 6.1, “Collateral” and “Intellectual Property
Collateral” shall include any “intent to use” trademark application only to the
extent (i) that the business of such Grantor, or portion thereof, to which that
mark pertains is also included in the Collateral and (ii) that such business is
ongoing and existing.
     SECTION 6.2. Securities Laws. If the Collateral Agent, at the direction of
the Administrative Agent, shall determine to exercise its right to sell all or
any of the Collateral that are Capital Securities pursuant to Section 6.1, each
Grantor agrees that, upon request of the Administrative Agent, each Grantor
will, at its own expense:
     (a) use commercially reasonable efforts to execute and deliver, and cause
(or, with respect to any issuer which is not a Subsidiary of such Grantor, use
its commercially reasonable efforts to cause) each issuer of the Collateral
contemplated to be sold and the directors and officers thereof to execute and
deliver, all such instruments and documents, and do or cause to be done all such
other acts and things, as may be necessary or, in the opinion of the
Administrative Agent, advisable to register such Collateral under the provisions
of the Securities Act of 1933, as from time to time amended (the “Securities
Act”), and use commercially reasonable efforts to cause the registration
statement relating thereto to become effective and to remain effective for such
period as prospectuses are required by law to be furnished, and to make all
amendments and
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supplements thereto and to the related prospectus which, in the opinion of the
Administrative Agent, are necessary or advisable, all in conformity with the
requirements of the Securities Act and the rules and regulations of the SEC
applicable thereto;
     (b) use its commercially reasonable efforts to exempt the Collateral under
the state securities or “Blue Sky” laws and to obtain all necessary governmental
approvals for the sale of the Collateral, as requested by the Administrative
Agent;
     (c) cause (or, with respect to any issuer that is not a Subsidiary of such
Grantor, use its commercially reasonable efforts to cause) each such issuer to
make available to its security holders, as soon as practicable, an earnings
statement that will satisfy the provisions of Section 11(a) of the Securities
Act; and
     (d) do or use commercially reasonable efforts to cause to be done all such
other acts and things as may be necessary to make such sale of the Collateral or
any part thereof valid and binding and in compliance with applicable law.
     Each Grantor acknowledges the impossibility of ascertaining the amount of
damages that would be suffered by the Collateral Agent or the Secured Parties by
reason of the failure by such Grantor to perform any of the covenants contained
in this Section and consequently agrees that, if such Grantor shall fail to
perform any of such covenants, it shall pay, as liquidated damages and not as a
penalty, an amount equal to the value (as determined by the Collateral Agent) of
such Collateral on the date the Collateral Agent shall demand compliance with
this Section.
     SECTION 6.3. Compliance with Restrictions. Each Grantor agrees that in any
sale of any of the Collateral whenever a Specified Default shall have occurred
and be continuing, the Collateral Agent is hereby authorized to comply with any
limitation or restriction in connection with such sale as it may be advised by
counsel is necessary in order to avoid any violation of applicable law
(including compliance with such procedures as may restrict the number of
prospective bidders and purchasers, require that such prospective bidders and
purchasers have certain qualifications, and restrict such prospective bidders
and purchasers to Persons who will represent and agree that they are purchasing
for their own account for investment and not with a view to the distribution or
resale of such Collateral), or in order to obtain any required approval of the
sale or of the purchaser by any Governmental Authority or official, and such
Grantor further agrees that such compliance shall not result in such sale being
considered or deemed not to have been made in a commercially reasonable manner,
nor shall the Collateral Agent be liable nor accountable to such Grantor for any
discount allowed by the reason of the fact that such Collateral is sold in
compliance with any such limitation or restriction.
     SECTION 6.4. Protection of Collateral. The Collateral Agent may from time
to time, at the direction of the Administrative Agent, perform any act which any
Grantor fails, within three days following the request by the Collateral Agent,
to perform or agree to perform (and thereafter actually perform within seven
days following notice of requested performance) (it being understood that no
such request need be given after the occurrence and during the continuance of a
Specified Default) and the Collateral Agent may from time to time take any other
action which the Administrative Agent deems necessary for the maintenance,
preservation or protection of any of the Collateral or of its security interest
therein.
Pledge and Security Agreement
(First Lien)

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ARTICLE VII

MISCELLANEOUS PROVISIONS
     SECTION 7.1. Loan Document. This Security Agreement is a Loan Document
executed pursuant to the Credit Agreement and shall (unless otherwise expressly
indicated herein) be construed, administered and applied in accordance with the
terms and provisions thereof, including Article X thereof.
     SECTION 7.2. Binding on Successors, Transferees and Assigns; Assignment.
This Security Agreement shall remain in full force and effect until the
Termination Date has occurred, shall be binding upon the Grantors and their
successors, transferees and assigns and shall inure to the benefit of and be
enforceable by each Secured Party and its successors, transferees and assigns;
provided that no Grantor may (unless otherwise permitted under the terms of the
Credit Agreement or this Security Agreement) assign any of its obligations
hereunder without the prior written consent of all Lenders.
     SECTION 7.3. Amendments, etc. No amendment to or waiver of any provision of
this Security Agreement, nor consent to any departure by any Grantor from its
obligations under this Security Agreement, shall in any event be effective
unless the same shall be in writing and signed by the Collateral Agent (at the
direction of the Administrative Agent) and the Administrative Agent (on behalf
of the Lenders or the Required Lenders, as the case may be, pursuant to
Section 10.1 of the Credit Agreement) and the Grantors and then such waiver or
consent shall be effective only in the specific instance and for the specific
purpose for which given.
     SECTION 7.4. Notices. All notices and other communications provided for
hereunder shall be in writing or by facsimile and addressed, delivered or
transmitted to the appropriate party at the address or facsimile number of such
party specified in the Credit Agreement or at such other address or facsimile
number as may be designated by such party in a notice to the other party. Any
notice or other communication, if mailed and properly addressed with postage
prepaid or if properly addressed and sent by pre-paid courier service, shall be
deemed given when received; any such notice or other communication, if
transmitted by facsimile, shall be deemed given when transmitted and
electronically confirmed.
     SECTION 7.5. Release of Liens. Upon (a) the Disposition of Collateral in
accordance with the Credit Agreement or (b) the occurrence of the Termination
Date, the security interests granted herein shall automatically terminate with
respect to (i) such Collateral (in the case of clause (a)) or (ii) all
Collateral (in the case of clause (b)). Upon any such Disposition or
termination, the Collateral Agent will, at the Grantors’ sole expense, promptly
deliver to the Grantors, without any representations, warranties or recourse of
any kind whatsoever, all Collateral held by the Collateral Agent hereunder, and
execute and deliver to the Grantors such documents as the Grantors shall
reasonably request to evidence such termination.
     SECTION 7.6. Additional Grantors. Upon the execution and delivery by any
other Person of a supplement in the form of Annex I hereto, such U.S. Person
shall become a “Grantor” hereunder with the same force and effect as if it were
originally a party to this Security Agreement and named as a “Grantor”
hereunder. The execution and delivery of such
Pledge and Security Agreement
(First Lien)

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supplement shall not require the consent of any other Grantor hereunder (except
to the extent already obtained), and the rights and obligations of each Grantor
hereunder shall remain in full force and effect notwithstanding the addition of
any new Grantor as a party to this Security Agreement.
     SECTION 7.7. No Waiver; Remedies. In addition to, and not in limitation of
Section 2.4, no failure on the part of any Secured 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 7.8. Headings. The various headings of this Security Agreement are
inserted for convenience only and shall not affect the meaning or interpretation
of this Security Agreement or any provisions thereof.
     SECTION 7.9. Severability. Any provision of this Security Agreement which
is prohibited or unenforceable in any jurisdiction shall, as to such provision
and such jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions of this Security
Agreement or affecting the validity or enforceability of such provision in any
other jurisdiction.
     SECTION 7.10. Governing Law, Entire Agreement, etc. THIS SECURITY AGREEMENT
SHALL BE DEEMED TO BE A CONTRACT MADE UNDER AND GOVERNED BY THE INTERNAL LAWS OF
THE STATE OF NEW YORK (INCLUDING FOR SUCH PURPOSE SECTIONS 5 1401 AND 5 1402 OF
THE GENERAL OBLIGATIONS LAW OF THE STATE OF NEW YORK), EXCEPT TO THE EXTENT THAT
THE PERFECTION, EFFECT OF PERFECTION OR NONPERFECTION, AND PRIORITY OF THE
SECURITY INTEREST HEREUNDER, OR REMEDIES HEREUNDER, IN RESPECT OF ANY PARTICULAR
COLLATERAL ARE GOVERNED BY THE LAWS OF A JURISDICTION OTHER THAN THE STATE OF
NEW YORK. This Security Agreement and the other Loan Documents constitute the
entire understanding among the parties hereto with respect to the subject matter
hereof and thereof and supersede any prior agreements, written or oral, with
respect thereto.
     SECTION 7.11. Counterparts. This Security Agreement may be executed by the
parties hereto in several counterparts, each of which shall be deemed to be an
original and all of which shall constitute together but one and the same
agreement. Delivery of an executed counterpart of a signature page to this
Security Agreement by facsimile (or other electronic) transmission shall be
effective as delivery of a manually executed counterpart of this Security
Agreement.
     SECTION 7.12. Foreign Pledge Agreements. Without limiting any of the
rights, remedies, privileges or benefits provided hereunder to the Collateral
Agent for its benefit and the ratable benefit of the other Secured Parties, each
Grantor and the Collateral Agent hereby agree that the terms and provisions of
this Security Agreement in respect of any Collateral subject to the pledge or
other Lien of a Foreign Pledge Agreement are, and shall be deemed to be,
supplemental and in addition to the rights, remedies, privileges and benefits
provided to the Collateral Agent and the other Secured Parties under such
Foreign Pledge Agreement and under
Pledge and Security Agreement
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applicable law to the extent consistent with applicable law; provided that, in
the event that the terms of this Security Agreement conflict or are inconsistent
with the applicable Foreign Pledge Agreement or applicable law governing such
Foreign Pledge Agreement, (i) to the extent that the provisions of such Foreign
Pledge Agreement or applicable foreign law are, under applicable foreign law,
necessary for the creation, perfection or priority of the security interests in
the Collateral subject to such Foreign Pledge Agreement, the terms of such
Foreign Pledge Agreement or such applicable law shall be controlling and
(ii) otherwise, the terms hereof shall be controlling.
     IN WITNESS WHEREOF, each of the parties hereto has caused this Security
Agreement to be duly executed and delivered by its Authorized Officer, solely in
such capacity and not as an individual, as of the date first above written.

             
 
                HANESBRANDS INC.    
 
             
 
  By:        
 
           
 
  Name:        
 
  Title:        
 
                HBI BRANDED APPAREL LIMITED, INC.    
 
           
 
  By:        
 
           
 
  Name:        
 
  Title:        
 
                HANESBRANDS DIRECT, LLC    
 
           
 
  By:        
 
           
 
  Name:        
 
  Title:        
 
                UPEL, INC.      
 
  By:        
 
           
 
  Name:        
 
  Title:        

Pledge and Security Agreement
(First Lien)

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                CARIBETEX, INC.    
 
           
 
  By:        
 
           
 
  Name:        
 
  Title:        
 
                SEAMLESS TEXTILES, LLC    
 
           
 
  By:        
 
           
 
  Name:        
 
  Title:        
 
                BA INTERNATIONAL, L.L.C.    
 
           
 
  By:        
 
           
 
  Name:        
 
  Title:        
 
                HBI INTERNATIONAL, LLC    
 
           
 
  By:        
 
           
 
  Name:        
 
  Title:        
 
                HBI BRANDED APPAREL ENTERPRISES, LLC    
 
           
 
  By:        
 
           
 
  Name:        
 
  Title:        
 
                CASA INTERNATIONAL, LLC    
 
           
 
  By:        
 
           
 
  Name:        
 
  Title:        

Pledge and Security Agreement
(First Lien)

34

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                UPCR, INC.    
 
           
 
  By:        
 
           
 
  Name:        
 
  Title:        
 
                HBI SOURCING, LLC    
 
           
 
  By:        
 
           
 
  Name:        
 
  Title:        
 
                CEIBENA DEL, INC.    
 
           
 
  By:        
 
           
 
  Name:        
 
  Title:        
 
                NT INVESTMENT COMPANY, INC.    
 
           
 
  By:        
 
           
 
  Name:        
 
  Title:        
 
                HANESBRANDS DISTRIBUTION, INC.    
 
           
 
  By:        
 
           
 
  Name:        
 
  Title:        

Pledge and Security Agreement
(First Lien)

35

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                CARIBESOCK, INC.    
 
           
 
  By:        
 
           
 
  Name:        
 
  Title:        
 
                NATIONAL TEXTILES, L.L.C.    
 
           
 
  By:        
 
           
 
  Name:        
 
  Title:        
 
                HANES PUERTO RICO, INC.    
 
           
 
  By:        
 
           
 
  Name:        
 
  Title:        
 
                PLAYTEX INDUSTRIES, INC.    
 
           
 
  By:        
 
           
 
  Name:        
 
  Title:        
 
                INNER SELF LLC    
 
           
 
  By:        
 
           
 
  Name:        
 
  Title:        
 
                PLAYTEX DORADO, LLC    
 
           
 
  By:        
 
           
 
  Name:        
 
  Title:        

Pledge and Security Agreement
(First Lien)

36

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                HANES MENSWEAR, LLC    
 
           
 
  By:        
 
           
 
  Name:        
 
  Title:        
 
                CITIBANK, N.A.,    
 
                as Collateral Agent    
 
           
 
  By:        
 
           
 
  Name:        
 
  Title:        
 
                CITICORP USA, INC.    
 
                as Administrative Agent    
 
           
 
  By:        
 
           
 
  Name:        
 
  Title:        

Pledge and Security Agreement
(First Lien)

37

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SCHEDULE I
to Security Agreement
Name of Grantor:

                                                              Common Stock      
                Authorized     Outstanding         Issuer (corporate)   Cert. #
    # of Shares     Shares     Shares     % of Shares Pledged  
 
                                       

                      Limited Liability Company Interests       % of Limited
Liability     Type of Limited Liability   Issuer (limited liability company)  
Company Interests Pledged     Company Interests Pledged  
 
               

                      Partnership Interests       % of Partnership     % of
Partnership   Issuer (partnership)   Interests Owned     Interests Pledged  
 
               

Pledge and Security Agreement
(First Lien)

 

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SCHEDULE II
to Security Agreement
Item A. Location of each Grantor.

     
Name of Grantor:
  Location for purposes of UCC:
 
   
[GRANTOR]
   

Item B. Organizational identification number.

 
Name of Grantor:
 
[GRANTOR]

Item C. Merger or other corporate reorganization.

     
Name of Grantor:
  Merger or other corporate reorganization:
 
   
[GRANTOR]
   

Item D. Taxpayer ID numbers.
Pledge and Security Agreement
(First Lien)

 

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Name of Grantor:
  Taxpayer ID numbers:
 
   
[GRANTOR]
   

Item E. Government Contracts.

     
Name of Grantor:
  Description of Contract:
 
   
[GRANTOR]
   

Item F. Deposit Accounts and Securities Accounts.

     
Name of Grantor:
  Description of Deposit Accounts and Securities Accounts:
 
   
[GRANTOR]
   

Item G. Letter of Credit Rights.

     
Name of Grantor:
  Description of Letter of Credit Rights:
 
   
[GRANTOR]
   

Item H. Commercial Tort Claims.
Pledge and Security Agreement
(First Lien)

 

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Name of Grantor:
  Description of Commercial Tort Claims:
 
   
[GRANTOR]
   

Pledge and Security Agreement
(First Lien)

 

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SCHEDULE III
to Security Agreement
Item A. Patents
ISSUED PATENTS

      PATENT NO.   ISSUE DATE     TITLE

Pending Patent Applications

      SERIAL NO.   FILING DATE     TITLE

Item B. Patent Licenses

                      Effective     Expiration PATENT   LICENSOR     LICENSEE  
  DATE     DATE

Pledge and Security Agreement
(First Lien)

 

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SCHEDULE IV
to Security Agreement
Item A. Trademarks
Registered Trademarks

      TRADEMARK   REGISTRATION NO.     REGISTRATION DATE

Pending Trademark Applications

      TRADEMARK   SERIAL NO.     FILING DATE

Item B. Trademark Licenses

                      Effective     Expiration TRADEMARK   LICENSOR     LICENSEE
    DATE     DATE

Pledge and Security Agreement
(First Lien)

 

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SCHEDULE V
to Security Agreement
Item A. Copyrights/Mask Works
Registered Copyrights/Mask Works

          REGISTRATION DATE       REGISTRATION NO.   TITLE     AUTHOR(S)

Copyright/Mask Work Pending Registration Applications
          SERIAL NO.
Item B. Copyright/Mask Work Licenses (including an all exclusive Copyright
Licenses for U.S. registered Copyrights)

                      Effective     Expiration Copyright   Licensor     Licensee
    Date     Date

Pledge and Security Agreement
(First Lien)

 

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EXHIBIT A
to Security Agreement
PATENT SECURITY AGREEMENT (FIRST LIEN)
     This PATENT SECURITY AGREEMENT, dated as of                      ___,
200___ (this “Agreement”), is made by [NAME OF GRANTOR], a                     
                     (the “Grantor”), in favor of CITIBANK, N.A., as the
collateral agent (together with its successor(s) thereto in such capacity, the
“Collateral Agent”) for each of the Secured Parties.
W I T N E S S E T H:
     WHEREAS, pursuant to a First Lien Credit Agreement, dated as of
September 5, 2006 (as amended, supplemented, amended and restated or otherwise
modified from time to time, the “Credit Agreement”), among the Borrower, the
Lenders, HSBC Bank USA, National Association, LaSalle Bank National Association
and Barclays Bank PLC, as the Co-Documentation Agents, Merrill Lynch, Pierce,
Fenner & Smith Incorporated and Morgan Stanley Senior Funding, Inc., as the
Co-Syndication Agents, Citicorp USA, Inc., as the Administrative Agent, the
Collateral Agent, and Merrill Lynch, Pierce, Fenner & Smith Incorporated and
Morgan Stanley Senior Funding, Inc., as the Joint Lead Arrangers and Joint
Bookrunners, the Lenders and the Issuers have extended Commitments to make
Credit Extensions to the Borrower;
     WHEREAS, in connection with the Credit Agreement, the Grantor has executed
and delivered a Pledge and Security Agreement, dated as of September 5, 2006 (as
amended, supplemented, amended and restated or otherwise modified from time to
time, the “Security Agreement”);
     WHEREAS, pursuant to the Credit Agreement and pursuant to Section 4.5 of
the Security Agreement, the Grantor is required to execute and deliver this
Agreement and to grant to the Collateral Agent a continuing security interest in
all of the Patent Collateral (as defined below) to secure all Secured
Obligations; and
     WHEREAS, the Grantor has duly authorized the execution, delivery and
performance of this Agreement; and
     NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Grantor agrees, for the
benefit of each Secured Party, as follows:
     SECTION 1. Definitions. Unless otherwise defined herein or the context
otherwise requires, terms used in this Agreement, including its preamble and
recitals, have the meanings provided (or incorporated by reference) in the
Security Agreement.
     SECTION 2. Grant of Security Interest. The Grantor hereby grants to the
Collateral Agent, for its benefit and the ratable benefit of each other Secured
Party, a continuing security interest in all of
Pledge and Security Agreement
(First Lien)

 

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the Grantor’s right, title and interest, whether now or hereafter existing or
acquired by the Grantor, in and to the following (“Patent Collateral”):
     (a) inventions and discoveries, whether patentable or not, all letters
patent and applications for letters patent, including all patent applications in
preparation for filing, including all reissues, divisions, continuations,
continuations-in-part, extensions, renewals and reexaminations of any of the
foregoing, including all patents issued by, or patent applications filed with,
the United States Patent and Trademark Office (“Patents”), including each Patent
and Patent application referred to in Item A of Schedule I;
     (b) all United States Patent licenses, and other agreements for the grant
by or to the Grantor of any right to use any items of the type referred to in
clause (a) above (each a “Patent License”), including each Patent License
referred to in Item B of Schedule I;
     (c) the right to sue third parties for past, present and future
infringements of any Patent or Patent application, and for breach or enforcement
of any Patent License; and
     (d) all proceeds of, and rights associated with, the foregoing (including
Proceeds, licenses, royalties, income, payments, claims, damages and proceeds of
infringement suits).
     Notwithstanding the foregoing, Patent Collateral shall not include any
Excluded Collateral.
     SECTION 3. Security Agreement. This Agreement has been executed and
delivered by the Grantor for the purpose of registering the security interest of
the Collateral Agent in the Patent Collateral with the United States Patent and
Trademark Office. The security interest granted hereby has been granted as a
supplement to, and not in limitation of, the security interest granted to the
Collateral Agent for its benefit and the ratable benefit of each other Secured
Party under the Security Agreement. The Security Agreement (and all rights and
remedies of the Collateral Agent and each Secured Party thereunder) shall remain
in full force and effect in accordance with its terms.
     SECTION 4. Release of Liens. Upon (i) the Disposition of Patent Collateral
in accordance with the Credit Agreement or (ii) the occurrence of the
Termination Date, the security interests granted herein shall automatically
terminate with respect to (A) such Patent Collateral (in the case of clause (i))
or (B) all Patent Collateral (in the case of clause (ii)). Upon any such
Disposition or termination, the Collateral Agent will, at the Grantor’s sole
expense, deliver to the Grantor, without any representations, warranties or
recourse of any kind whatsoever, all Patent Collateral held by the Collateral
Agent hereunder, and execute and deliver to the Grantor such Documents as the
Grantor shall reasonably request to evidence such termination.
Pledge and Security Agreement
(First Lien)

A - 2

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     SECTION 5. Acknowledgment. The Grantor does hereby further acknowledge and
affirm that the rights and remedies of the Collateral Agent with respect to the
security interest in the Patent Collateral granted hereby are more fully set
forth in the Security Agreement, the terms and provisions of which (including
the remedies provided for therein) are incorporated by reference herein as if
fully set forth herein.
     SECTION 6. Loan Document. This Agreement is a Loan Document executed
pursuant to the Credit Agreement and shall (unless otherwise expressly indicated
herein) be construed, administered and applied in accordance with the terms and
provisions thereof, including Article X thereof.
     SECTION 7. Counterparts. This Agreement may be executed by the parties
hereto in several counterparts, each of which shall be deemed to be an original
and all of which shall constitute together but one and the same agreement.
Delivery of an executed counterpart of a signature page to this Agreement by
facsimile (or other electronic) transmission shall be effective as delivery of a
manually executed counterpart of this Agreement.
*   *   *   *   *
Pledge and Security Agreement
(First Lien)

A - 3

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     IN WITNESS WHEREOF, each of the parties hereto has caused this Agreement to
be duly executed and delivered by its Authorized Officer, solely in such
capacity and not as an individual, as of the date first above written.

            [NAME OF GRANTOR]
      By:           Name:           Title:        

            CITIBANK, N.A.,
as Collateral Agent
      By:           Name:           Title:      

Pledge and Security Agreement
(First Lien)

A - 4

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SCHEDULE I
to Patent Security Agreement
Item A. Patents
Issued Patents

      Patent No.   Issue Date     Title

Pending Patent Applications

      Serial No.   Filing Date     Title

Item B. Patent Licenses

                      Effective     Expiration Patent   Licensor     Licensee  
  Date     Date

Pledge and Security Agreement
(First Lien)

A - 5

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EXHIBIT B
to Security Agreement
TRADEMARK SECURITY AGREEMENT (FIRST LIEN)
     This TRADEMARK SECURITY AGREEMENT, dated as of                      ___,
200___ (this “Agreement”), is made by [NAME OF GRANTOR], a                     
                     (the “Grantor”), in favor of CITIBANK, N.A., as the
collateral agent (together with its successor(s) thereto in such capacity, the
“Collateral Agent”) for each of the Secured Parties.
W I T N E S S E T H:
     WHEREAS, pursuant to a First Lien Credit Agreement, dated as of
September 5, 2006 (as amended, supplemented, amended and restated or otherwise
modified from time to time, the “Credit Agreement”), among the Borrower, the
Lenders, HSBC Bank USA, National Association, LaSalle Bank National Association
and Barclays Bank PLC, as the Co-Documentation Agents, Merrill Lynch, Pierce,
Fenner & Smith Incorporated and Morgan Stanley Senior Funding, Inc., as the
Co-Syndication Agents, Citicorp USA, Inc., as the Administrative Agent, the
Collateral Agent, and Merrill Lynch, Pierce, Fenner & Smith Incorporated and
Morgan Stanley Senior Funding, Inc., as the Joint Lead Arrangers and Joint
Bookrunners, the Lenders and the Issuers have extended Commitments to make
Credit Extensions to the Borrower;
     WHEREAS, in connection with the Credit Agreement, the Grantor has executed
and delivered a Pledge and Security Agreement, dated as of September 5, 2006 (as
amended, supplemented, amended and restated or otherwise modified from time to
time, the “Security Agreement”);
     WHEREAS, pursuant to the Credit Agreement and pursuant to Section 4.5 of
the Security Agreement, the Grantor is required to execute and deliver this
Agreement and to grant to the Collateral Agent a continuing security interest in
all of the Trademark Collateral (as defined below) to secure all Secured
Obligations; and
     WHEREAS, the Grantor has duly authorized the execution, delivery and
performance of this Agreement; and
     NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Grantor agrees, for the
benefit of each Secured Party, as follows:
     SECTION 1. Definitions. Unless otherwise defined herein or the context
otherwise requires, terms used in this Agreement, including its preamble and
recitals, have the meanings provided (or incorporated by reference) in the
Security Agreement.
     SECTION 2. Grant of Security Interest. The Grantor hereby grants to the
Collateral Agent, for its benefit and the ratable benefit of each other Secured
Party, a continuing security interest in all of
Pledge and Security Agreement
(First Lien)

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the Grantor’s right, title and interest, whether now or hereafter existing or
acquired by the Grantor, in and to the following (the “Trademark Collateral”):
     (a) (i) all United States trademarks, trade names, corporate names, company
names, business names, fictitious business names, trade styles, service marks,
certification marks, collective marks, logos and other source or business
identifiers, and all goodwill of the business associated therewith, now existing
or hereafter adopted or acquired, whether currently in use or not, all
registrations and recordings thereof and all applications in connection
therewith, whether pending or in preparation for filing, including
registrations, recordings and applications (except for any such applications
filed pursuant to 15 U.S.C. § 1051(b)) in the United States Patent and Trademark
Office, and all common-law rights relating to the foregoing, and (ii) the right
to obtain all reissues, extensions or renewals of the foregoing (collectively
referred to as “Trademarks”), including those Trademarks referred to in Item A
of Schedule I;
     (b) all Trademark licenses and other agreements for the grant by or to the
Grantor of any right to use any Trademark (each a “Trademark License”),
including each Trademark License referred to in Item B of Schedule I;
     (c) all of the goodwill of the business connected with the use of, and
symbolized by the Trademarks described in clause (a) and, to the extent
applicable, clause (b);
     (d) the right to sue third parties for past, present and future
infringements or dilution of the Trademarks described in clause (a) and, to the
extent applicable, clause (b) or for any injury to the goodwill associated with
the use of any such Trademark or for breach or enforcement of any Trademark
License; and
     (e) all proceeds of, and rights associated with, the foregoing (including
Proceeds, licenses, royalties, income, payments, claims, damages and proceeds of
infringement suits).
     Notwithstanding the foregoing, Trademark Collateral shall not include any
Excluded Collateral.
     SECTION 3. Security Agreement. This Agreement has been executed and
delivered by the Grantor for the purpose of registering the security interest of
the Collateral Agent in the Trademark Collateral with the United States Patent
and Trademark Office. The security interest granted hereby has been granted as a
supplement to, and not in limitation of, the security interest granted to the
Collateral Agent for its benefit and the ratable benefit of each other Secured
Party under the Security Agreement. The Security Agreement (and all rights and
remedies of the Collateral Agent and each Secured Party thereunder) shall remain
in full force and effect in accordance with its terms.
     SECTION 4. Release of Liens. Upon (i) the Disposition of Trademark
Collateral in accordance with the Credit Agreement or (ii) the occurrence of the
Termination Date, the security interests granted herein shall automatically
terminate with respect to (A) such Trademark Collateral (in the case of clause
(i)) or (B) all Trademark Collateral (in the case of clause (ii)). Upon any such
Pledge and Security Agreement
(First Lien)

B - 2

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Disposition or termination, the Collateral Agent will, at the Grantor’s sole
expense, deliver to the Grantor, without any representations, warranties or
recourse of any kind whatsoever, all Trademark Collateral held by the Collateral
Agent hereunder, and execute and deliver to the Grantor such Documents as the
Grantor shall reasonably request to evidence such termination.
     SECTION 5. Acknowledgment. The Grantor does hereby further acknowledge and
affirm that the rights and remedies of the Collateral Agent with respect to the
security interest in the Trademark Collateral granted hereby are more fully set
forth in the Security Agreement, the terms and provisions of which (including
the remedies provided for therein) are incorporated by reference herein as if
fully set forth herein.
     SECTION 6. Loan Document. This Agreement is a Loan Document executed
pursuant to the Credit Agreement and shall (unless otherwise expressly indicated
herein) be construed, administered and applied in accordance with the terms and
provisions thereof, including Article X thereof.
     SECTION 7. Counterparts. This Agreement may be executed by the parties
hereto in several counterparts, each of which shall be deemed to be an original
and all of which shall constitute together but one and the same agreement.
Delivery of an executed counterpart of a signature page to this Agreement by
facsimile (or other electronic) transmission shall be effective as delivery of a
manually executed counterpart of this Agreement.
*   *   *   *   *
Pledge and Security Agreement
(First Lien)

B - 3

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     IN WITNESS WHEREOF, each of the parties hereto has caused this Agreement to
be duly executed and delivered by Authorized Officer, solely in such capacity
and not as an individual, as of the date first above written.

            [NAME OF GRANTOR]
      By:           Name:           Title:        

            CITIBANK, N.A.,
as Collateral Agent
      By:           Name:           Title:      

Pledge and Security Agreement
(First Lien)

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SCHEDULE I
to Trademark Security Agreement
Item A. Trademarks
Registered Trademarks

      Trademark   Registration No.     Registration Date

Pending Trademark Applications

      Trademark   Serial No.     Filing Date

Item B. Trademark Licenses

                      Effective     Expiration Trademark   Licensor     Licensee
    Date     Date

Pledge and Security Agreement
(First Lien)

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EXHIBIT C
to Security Agreement
COPYRIGHT SECURITY AGREEMENT (FIRST LIEN)
     This COPYRIGHT SECURITY AGREEMENT, dated as of                      ___,
200___ (this “Agreement”), is made by [NAME OF GRANTOR], a                     
                     (the “Grantor”), in favor of CITIBANK, N.A., as the
collateral agent (together with its successor(s) thereto in such capacity, the
“Collateral Agent”) for each of the Secured Parties.
W I T N E S S E T H:
     WHEREAS, pursuant to a First Lien Credit Agreement, dated as of
September 5, 2006 (as amended, supplemented, amended and restated or otherwise
modified from time to time, the “Credit Agreement”), among the Borrower, the
Lenders, HSBC Bank USA, National Association, LaSalle Bank National Association
and Barclays Bank PLC, as the Co-Documentation Agents, Merrill Lynch, Pierce,
Fenner & Smith Incorporated and Morgan Stanley Senior Funding, Inc., as the
Co-Syndication Agents, Citicorp USA, Inc., as the Administrative Agent, the
Collateral Agent, and Merrill Lynch, Pierce, Fenner & Smith Incorporated and
Morgan Stanley Senior Funding, Inc., as the Joint Lead Arrangers and Joint
Bookrunners, the Lenders and the Issuers have extended Commitments to make
Credit Extensions to the Borrower;
     WHEREAS, in connection with the Credit Agreement, the Grantor has executed
and delivered a Pledge and Security Agreement, dated as of September 5, 2006 (as
amended, supplemented, amended and restated or otherwise modified from time to
time, the “Security Agreement”);
     WHEREAS, pursuant to the Credit Agreement and pursuant to Section 4.5 of
the Security Agreement, the Grantor is required to execute and deliver this
Agreement and to grant to the Collateral Agent a continuing security interest in
all of the Copyright Collateral (as defined below) to secure all Secured
Obligations; and
     WHEREAS, the Grantor has duly authorized the execution, delivery and
performance of this Agreement; and
     NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Grantor agrees, for the
benefit of each Secured Party, as follows:
Pledge and Security Agreement
(First Lien)

 

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     SECTION 1. Definitions. Unless otherwise defined herein or the context
otherwise requires, terms used in this Agreement, including its preamble and
recitals, have the meanings provided (or incorporated by reference) in the
Security Agreement.
     SECTION 2. Grant of Security Interest. The Grantor hereby grants to the
Collateral Agent, for its benefit and the ratable benefit of each other Secured
Party, a continuing security interest in all of the Grantor’s right, title and
interest, whether now or hereafter existing or acquired by the Grantor, in and
to the following (the “Copyright Collateral”):
     (a) all United States copyrights, registered or unregistered and whether
published or unpublished, now or hereafter in force including copyrights
registered or applied for in the United States Copyright Office, and
registrations and recordings thereof and all applications for registration
thereof, whether pending or in preparation and all extensions and renewals of
the foregoing (“Copyrights”), including the Copyrights which are the subject of
a registration or application referred to in Item A of Schedule I;
     (b) all express or implied Copyright licenses and other agreements for the
grant by or to the Grantor of any right to use any items of the type referred to
in clause (a) above (each a “Copyright License”), including each Copyright
License referred to in Item B of Schedule I;
     (c) the right to sue for past, present and future infringements of any of
the Copyrights owned by the Grantor, and for breach or enforcement of any
Copyright License and all extensions and renewals of any thereof; and
     (d) all proceeds of, and rights associated with, the foregoing (including
Proceeds, licenses, royalties, income, payments, claims, damages and proceeds of
infringement suits).
     Notwithstanding the foregoing, Copyright Collateral shall not include any
Excluded Collateral.
     SECTION 3. Security Agreement. This Agreement has been executed and
delivered by the Grantor for the purpose of registering the security interest of
the Collateral Agent in the Copyright Collateral with the United States
Copyright Office. The security interest granted hereby has been granted as a
supplement to, and not in limitation of, the security interest granted to the
Collateral Agent for its benefit and the ratable benefit of each other Secured
Party under the Security Agreement. The Security Agreement (and all rights and
remedies of the Collateral Agent and each Secured Party thereunder) shall remain
in full force and effect in accordance with its terms.
     SECTION 4. Release of Liens. Upon (i) the Disposition of Copyright
Collateral in accordance with the Credit Agreement or (ii) the occurrence of the
Termination Date, the security interests granted herein shall automatically
terminate with respect to (A) such Copyright Collateral (in the case of clause
(i)) or (B) all Copyright Collateral (in the case of clause (ii)). Upon any such
Disposition or termination, the Collateral Agent will, at the Grantor’s sole
expense, deliver to the Grantor, without any representations, warranties or
recourse of any kind whatsoever, all
Pledge and Security Agreement
(First Lien)

C - 2

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Copyright Collateral held by the Collateral Agent hereunder, and execute and
deliver to the Grantor such Documents as the Grantor shall reasonably request to
evidence such termination.
     SECTION 5. Acknowledgment. The Grantor does hereby further acknowledge and
affirm that the rights and remedies of the Collateral Agent with respect to the
security interest in the Copyright Collateral granted hereby are more fully set
forth in the Security Agreement, the terms and provisions of which (including
the remedies provided for therein) are incorporated by reference herein as if
fully set forth herein.
     SECTION 6. Loan Document. This Agreement is a Loan Document executed
pursuant to the Credit Agreement and shall (unless otherwise expressly indicated
herein) be construed, administered and applied in accordance with the terms and
provisions thereof, including Article X thereof.
     SECTION 7. Counterparts. This Agreement may be executed by the parties
hereto in several counterparts, each of which shall be deemed to be an original
and all of which shall constitute together but one and the same agreement.
Delivery of an executed counterpart of a signature page to this Agreement by
facsimile (or other electronic) transmission shall be effective as delivery of a
manually executed counterpart of this Agreement.
*   *   *   *   *
Pledge and Security Agreement
(First Lien)

C - 3

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     IN WITNESS WHEREOF, each of the parties hereto has caused this Agreement to
be duly executed and delivered by its Authorized Officer, solely in such
capacity and not as an individual, as of the date first above written.

            [NAME OF GRANTOR]
      By:           Name:           Title:        

            CITIBANK, N.A.,
as Collateral Agent
      By:           Name:           Title:      

Pledge and Security Agreement
(First Lien)

C - 4

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SCHEDULE I
to Copyright Security Agreement
Item A. Copyrights/Mask Works
Registered Copyrights/Mask Works

      Registration No.   Registration Date     Title

Item B. Copyright/Mask Work Licenses (including an all exclusive Copyright
Licenses for U.S. registered Copyrights)

                      Effective     Expiration Copyright   Licensor     Licensee
    Date     Date

Pledge and Security Agreement
(First Lien)

C - 5

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ANNEX I
to Security Agreement
SUPPLEMENT TO
PLEDGE AND SECURITY AGREEMENT (FIRST LIEN)
     This SUPPLEMENT, dated as of                                          ___,
                     (this “Supplement”), is to the Pledge and Security
Agreement, dated as of September 5, 2006 (as amended, supplemented, amended and
restated or otherwise modified from time to time, the “Security Agreement”),
among the Grantors (such term, and other terms used in this Supplement, to have
the meanings set forth in or incorporated by reference in Article I of the
Security Agreement) from time to time party thereto, in favor of CITIBANK, N.A.,
as the collateral agent (together with its successor(s) thereto in such
capacity, the “Collateral Agent”) for each of the Secured Parties.
W I T N E S S E T H :
     WHEREAS, pursuant to a First Lien Credit Agreement, dated as of
September 5, 2006 (as amended, supplemented, amended and restated or otherwise
modified from time to time, the “Credit Agreement”), among the Borrower, the
Lenders, HSBC Bank USA, National Association, LaSalle Bank National Association
and Barclays Bank PLC, as the Co-Documentation Agents, Merrill Lynch, Pierce,
Fenner & Smith Incorporated and Morgan Stanley Senior Funding, Inc., as the
Co-Syndication Agents, Citicorp USA, Inc., as the Administrative Agent, the
Collateral Agent, and Merrill Lynch, Pierce, Fenner & Smith Incorporated and
Morgan Stanley Senior Funding, Inc., as the Joint Lead Arrangers and Joint
Bookrunners, the Lenders and the Issuers have extended Commitments to make
Credit Extensions to the Borrower; and
     WHEREAS, pursuant to the provisions of Section 7.6 of the Security
Agreement, each of the undersigned is becoming a Grantor under the Security
Agreement; and
     WHEREAS, each of the undersigned desires to become a “Grantor” under the
Security Agreement in order to induce the Secured Parties to continue to extend
Loans and issue Letters of Credit under the Credit Agreement;
     NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, each of the undersigned agrees, for
the benefit of each Secured Party, as follows.
Pledge and Security Agreement
(First Lien)

 

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     SECTION 1. Party to Security Agreement, etc. In accordance with the terms
of the Security Agreement, by its signature below each of the undersigned hereby
irrevocably agrees to become a Grantor under the Security Agreement with the
same force and effect as if it were an original signatory thereto and each of
the undersigned hereby (a) agrees to be bound by and comply with all of the
terms and provisions of the Security Agreement applicable to it as a Grantor and
(b) represents and warrants that the representations and warranties made by it
as a Grantor thereunder are true and correct in all material respects as of the
date hereof, unless stated to relate solely to an earlier date, in which case
such representations and warranties shall be true and correct in all material
respects as of such earlier date. In furtherance of the foregoing, each
reference to a “Grantor” and/or “Grantors” in the Security Agreement shall be
deemed to include each of the undersigned.
     SECTION 2. Representations. Each of the undersigned Grantor hereby
represents and warrants that this Supplement has been duly authorized, executed
and delivered by it and that this Supplement and the Security Agreement
constitute the legal, valid and binding obligation of each of the undersigned,
enforceable (except, in any case, as such enforceability may be limited by
applicable bankruptcy, insolvency, reorganization or similar laws affecting
creditors’ rights generally and by principles of equity) against it in
accordance with its terms.
     SECTION 3. Full Force of Security Agreement. Except as expressly
supplemented hereby, the Security Agreement shall remain in full force and
effect in accordance with its terms.
     SECTION 4. Severability. Wherever possible each provision of this
Supplement shall be interpreted in such manner as to be effective and valid
under applicable law, but if any provision of this Supplement shall be
prohibited by or invalid under such 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 Supplement or the Security
Agreement.
     SECTION 5. Governing Law, Entire Agreement, etc. THIS SUPPLEMENT SHALL BE
DEEMED TO BE A CONTRACT MADE UNDER AND GOVERNED BY THE INTERNAL LAWS OF THE
STATE OF NEW YORK (INCLUDING FOR SUCH PURPOSE SECTIONS 5-1401 AND 5-1402 OF THE
GENERAL OBLIGATIONS LAW OF THE STATE OF NEW YORK). This Supplement and the other
Loan Documents constitute the entire understanding among the parties hereto with
respect to the subject matter thereof and supersede any prior agreements,
written or oral, with respect thereto.
     SECTION 6. Counterparts. This Supplement may be executed by the parties
hereto in several counterparts, each of which shall be deemed to be an original
and all of which shall constitute together but one and the same agreement.
Delivery of an executed counterpart of a signature page to this Supplement by
facsimile (or other electronic) transmission shall be effective as delivery of a
manually executed counterpart of this Supplement.
*   *   *   *   *
Pledge and Security Agreement
(First Lien)

Annex I - 2

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     IN WITNESS WHEREOF, each of the parties hereto has caused this Agreement to
be duly executed and delivered by its Authorized Officer, solely in such
capacity and not as an individual, as of the date first above written.

            [NAME OF ADDITIONAL SUBSIDIARY]
      By:           Name:           Title:        

            [NAME OF ADDITIONAL SUBSIDIARY]
      By:           Name:           Title:        

ACCEPTED AND AGREED FOR ITSELF
AND ON BEHALF OF THE SECURED PARTIES:

        CITIBANK, N.A.,
as Collateral Agent         By:         Name:         Title:      

Pledge and Security Agreement
(First Lien)

Annex I - 3

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[COPY SCHEDULES FROM SECURITY AGREEMENT]
Pledge and Security Agreement
(First Lien)

Annex I - 4

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EXHIBIT H
INTERCREDITOR AGREEMENT
     This INTERCREDITOR AGREEMENT, dated as of September 5, 2006, is entered
into among CITIBANK, N.A., as First Lien Agent (as defined below), CITIBANK,
N.A., as Second Lien Agent (as defined below), CITIBANK, N.A., as Control Agent
(as defined below), the First Lien Borrower, the First Lien Guarantors, the
Second Lien Borrower and the Second Lien Guarantors (each as defined below) from
time to time a party hereto.
W I T N E S S E T H
     WHEREAS, concurrently with the execution and delivery of this Agreement,
the First Lien Borrower, certain financial institutions and other Persons (as
defined below) as lenders (together with their respective successors and
assigns, the “First Lien Lenders”), and Citicorp USA, Inc., as administrative
agent for such First Lien Lenders, are entering into a Credit Agreement, dated
as of the date hereof (as such agreement may be amended, supplemented, amended
and restated or otherwise modified from time to time, the “Initial First Lien
Financing Agreement”), pursuant to which such First Lien Lenders have agreed to
make loans and extensions of credit to the First Lien Borrower;
     WHEREAS, concurrently with the execution and delivery of this Agreement,
the Second Lien Borrower, certain financial institutions and other Persons (as
defined below) as lenders (together with their respective successors and
assigns, the “Second Lien Lenders”), and Citicorp USA, Inc., as administrative
agent for such Second Lien Lenders, are entering into a Credit Agreement, dated
as of the date hereof (as such agreement may be amended, supplemented, amended
and restated or otherwise modified from time to time, the “Initial Second Lien
Financing Agreement”), pursuant to which such Second Lien Lenders have agreed to
make loans to the Second Lien Borrower;
     WHEREAS, the First Lien Borrower and the First Lien Guarantors have granted
to the First Lien Agent security interests in the Common Collateral as security
for the prompt payment and performance of the First Lien Obligations;
     WHEREAS, the Second Lien Borrower and the Second Lien Guarantors have
granted to the Second Lien Agent security interests in the Common Collateral as
security for the prompt payment and performance of the Second Lien Obligations;
and
     WHEREAS, the First Lien Agent on behalf of itself and the First Lien
Lenders and the Second Lien Agent on behalf of itself and the Second Lien
Lenders, and by their acknowledgment hereof, the First Lien Borrower, the First
Lien Guarantors, the Second Lien Borrower and the Second Lien Guarantors, have
agreed to, among other things, the relative priority of Liens on the Common
Collateral as provided herein.
     NOW, THEREFORE, in consideration of the foregoing, the mutual covenants and
obligations herein set forth and for other good and valuable consideration, the
adequacy and receipt of which are hereby acknowledged, and in reliance upon the
representations, warranties
Intercreditor Agreement

- 1 -

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and covenants herein contained, the parties hereto, intending to be legally
bound, hereby agree as follows:
ARTICLE I
DEFINITIONS
     SECTION 1.1. Defined Terms. As used in this Agreement, the following terms
shall have the following meanings:
     “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. “Control”
means the possession, directly or indirectly, of the power to direct or cause
the direction of the management or policies of a Person, whether through the
ability to exercise voting power, by contract or otherwise. “Controlling” and
“Controlled” have meanings correlative thereto. Without limiting the generality
of the foregoing, a Person shall be deemed to be Controlled by another Person if
such other Person possesses, directly or indirectly, power to vote 10% or more
of the securities having ordinary voting power for the election of directors,
managing general partners or the equivalent.
     “Agreement” means this Intercreditor Agreement, as the same may be amended,
restated, supplemented or otherwise modified from time to time.
     “Cash Management Obligations” means, with respect to the Borrower or any of
its Subsidiaries, any direct or indirect liability, contingent or otherwise, of
such Person in respect of cash management services (including treasury,
depository, overdraft (daylight and temporary), credit or debit card, electronic
funds transfer and other cash management arrangements) provided after the
Closing Date by a Person who is (or was at the time such Cash Management
Obligations were incurred) the First Lien Administrative Agent, any First Lien
Lender or any Affiliate thereof, including obligations for the payment of fees,
interest, charges, expenses, attorneys’ fees and disbursements in connection
therewith to the extent provided for in the documents evidencing such cash
management services.
     “Bankruptcy Code” means Title 11 of the United States Code (11 U.S.C. 101
et seq.), as amended from time to time.
     “Borrowers” means the First Lien Borrower and the Second Lien Borrower.
     “Capital Securities” means, with respect to any Person, all shares,
interests, participations or other equivalents (however designated, whether
voting or non-voting) of such Person’s capital, whether now outstanding or
issued after the date hereof.
     “Capitalized Lease Liabilities” means, with respect to any Person, all
monetary obligations of such Person and its Subsidiaries under any leasing or
similar arrangement which, in accordance with GAAP, should be classified as
capitalized leases, and for purposes of each Loan Document the amount of such
obligations shall be the capitalized amount thereof, determined in accordance
with GAAP, and the stated maturity thereof shall be the date of the last payment
of rent or any other amount due under such lease prior to the first date upon
which such lease may be terminated by the lessee without payment of a premium or
a penalty.
Intercreditor Agreement

- 2 -

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     “Common Collateral” means any and all of the assets and property of any
Borrower or any Guarantor, now owned or hereafter acquired, whether real,
personal or mixed, in or upon which a Lien is granted or purported to be granted
to the First Lien Agent pursuant to the First Lien Documents and the Second Lien
Agent pursuant to the Second Lien Documents.
     “Comparable Second Lien Collateral Document” means in relation to any
Common Collateral subject to any First Lien Collateral Document, any Second Lien
Collateral Document(s) which create a security interest in the same Common
Collateral, granted by the same Borrower or same Guarantor.
     “Contingent Liability” means any agreement, undertaking or arrangement by
which any Person guarantees, endorses or otherwise becomes or is contingently
liable upon (by direct or indirect agreement, contingent or otherwise, to
provide funds for payment, to supply funds to, or otherwise to invest in, a
debtor, or otherwise to assure a creditor against loss) the Indebtedness of any
other Person (other than by endorsements of instruments in the course of
collection), or guarantees the payment of dividends or other distributions upon
the Capital Securities of any other Person. The amount of any Person’s
obligation under any Contingent Liability shall (subject to any limitation set
with respect thereto) be deemed to be the outstanding principal amount of the
debt, obligation or other liability guaranteed thereby.
     “Control Agent” is defined in clause (a) of Section 5.5.
     “Control Collateral” means any Common Collateral consisting of any
Certificated Security, Investment Property, Deposit Account, cash and any other
Collateral as to which a Lien may be perfected through possession or control by
the secured party, or any agent therefor.
     “Controlled Account” means any deposit accounts of the Borrowers or
Guarantors subject to Liens under the terms of the First Lien Collateral
Documents or the Second Lien Collateral Documents.
     “DIP Financing” is defined in Section 6.1.
     “Discharge of First Lien Obligations” means (subject to reinstatement in
accordance with Section 6.5), the first date upon which each of the following
has occurred: (i) the payment in full in cash of all First Lien Obligations
(other than contingent obligations or indemnification obligations for which no
claim has been asserted); (ii) the termination of all Hedging Obligations or the
cash collateralization (or collateralization with other letters of credit) of
all First Lien Obligations, in a manner satisfactory to the applicable Hedging
Obligation counterparty owed such obligation; (iii) the expiration, termination
or cash collateralization (or collateralization with other letters of credit),
in a manner satisfactory to the First Lien Agent, of all Letters of Credit (as
defined in the First Lien Financing Agreement); (iv) the termination of all
commitments to extend credit under the First Lien Financing Agreement; and
(v) the delivery by the First Lien Agent to the Second Lien Agent of a written
notice confirming that the conditions set forth in clauses (i), (ii), (iii) and
(iv) have been satisfied.
     “First Lien Administrative Agent” means the “Administrative Agent” under,
and as defined in, the First Lien Financing Agreement.
Intercreditor Agreement

- 3 -

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     “First Lien Agent” means Citibank, N.A., in its capacity as collateral
agent under the First Lien Collateral Documents, and any successor thereto
exercising substantially the same rights and powers.
     “First Lien Borrower” means Hanesbrands Inc., a Maryland corporation, as
borrower under the First Lien Financing Agreement.
     “First Lien Collateral” means all of the assets and properties of the First
Lien Borrower or any First Lien Guarantor, now owned or hereafter acquired,
whether real, personal or mixed, in or upon which a Lien is granted or purported
to be granted to the First Lien Lenders or the First Lien Agent as security for
any First Lien Obligation pursuant to the First Lien Documents.
     “First Lien Collateral Documents” means, collectively, the security
agreements, pledge agreements, collateral assignments, control agreements,
mortgages, deeds of trust and other documents or agreements, if any, providing
for grants or transfers for security executed and delivered by the First Lien
Borrower, any First Lien Guarantor or any of their respective Subsidiaries
creating a Lien upon property owned or to be acquired by the First Lien
Borrower, such First Lien Guarantor or such Subsidiary in favor of any holder of
First Lien Obligations or the First Lien Agent, in each case as security for any
First Lien Obligations.
     “First Lien Documents” means, collectively, the First Lien Financing
Agreement, the First Lien Collateral Documents, all Hedge Agreements evidencing
Hedging Obligations and all agreements evidencing Cash Management Obligations
that, in each case, constitute First Lien Obligations and all other agreements,
documents and instruments executed or delivered pursuant to or in connection
with any of the foregoing at any time evidencing any First Lien Obligations.
     “First Lien Financing Agreement” means, collectively, (i) the Initial First
Lien Financing Agreement, and (ii) any other credit agreement, loan agreement,
note agreement, promissory note, indenture or other agreement or instrument
evidencing or governing the terms of any Indebtedness or other financial
accommodation that has been incurred to extend, increase (subject to the
limitations set forth herein), replace, refinance or refund in whole or in part
the Indebtedness and other obligations outstanding under the Initial First Lien
Financing Agreement or any other agreement or instrument referred to in this
clause unless such agreement or instrument expressly provides that it is not
intended to be and is not a First Lien Financing Agreement; provided, that if
and to the extent that any amendment, modification, increase, replacement,
refinancing or refunding of the Initial First Lien Financing Agreement or any
other agreement referred to in this clause (in each case other than a DIP
Financing provided in accordance with Section 6) provides for revolving credit
commitments, revolving credit loans, term loans, bonds, debentures, notes or
similar instruments having a principal amount in excess of the Maximum First
Lien Principal Debt Amount, then only that portion of such principal amount in
excess of the Maximum First Lien Principal Debt Amount shall not constitute
First Lien Obligations for purposes of this Agreement. Any reference to the
First Lien Financing Agreement hereunder shall be deemed a reference to any
First Lien Financing Agreement then in existence.
Intercreditor Agreement

- 4 -

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     “First Lien Guarantor” means each Person that is (or hereafter becomes) a
guarantor of the First Lien Obligations pursuant to the First Lien Documents.
Upon becoming a guarantor thereunder such Person shall automatically be deemed
to be a First Lien Guarantor for all purposes hereunder.
     “First Lien Lenders” is defined in the recitals and in addition shall
include the First Lien Agent and any Person from time to time holding (or
committed to provide) First Lien Obligations.
     “First Lien Obligations” means, collectively, (i) subject, in the case of
principal only, to the proviso in the definition of First Lien Financing
Agreement, all Indebtedness outstanding under or with respect to one or more of
the First Lien Documents, and (ii) all other Obligations owing by the First Lien
Borrower or any First Lien Guarantor under or with respect to the First Lien
Financing Agreement or any other First Lien Document, including all claims under
the First Lien Documents for interest, fees, expense reimbursements,
indemnification and other similar claims, and all claims with respect to Cash
Management Obligations and Hedging Obligations (other than those owing to the
Second Lien Agent). First Lien Obligations shall include all interest accrued or
accruing (or which would accrue absent the commencement of an Insolvency or
Liquidation Proceeding) after the commencement of an Insolvency or Liquidation
Proceeding in accordance with and at the rate specified in the First Lien
Financing Agreement, whether or not the claim for such interest is allowed or
allowable in any Insolvency or Liquidation Proceeding. To the extent any payment
with respect to the First Lien Obligations (whether by or on behalf of the First
Lien Borrower or any First Lien Guarantor, as proceeds of security, enforcement
of any right of setoff or otherwise) is declared to be a fraudulent conveyance
or a preference or in any respect set aside or required to be paid to a debtor
in possession, the Second Lien Agent, a receiver or similar Person, then the
Obligation or part thereof originally intended to be satisfied shall be deemed
to be reinstated and outstanding as if such payment had not occurred, all as
more fully set forth in Section 6.5.
     “First Lien Required Lenders” means with respect to any amendment or
modification of the First Lien Financing Agreement or this Agreement, or any
termination or waiver of any provision of the First Lien Financing Agreement or
this Agreement, or any consent or departure by the First Lien Borrower or the
First Lien Guarantors, as the case may be, therefrom (in each case exclusive of
any such modification, waiver, consent, etc., which is permitted to be effected
by the First Lien Administrative Agent and the First Lien Borrower without
further approval or consent of any First Lien Lenders), those First Lien
Lenders, the approval of which is required pursuant to the First Lien Financing
Agreement to approve such amendment or modification, termination or waiver or
consent or departure.
     “GAAP” means United States generally accepted accounting principles and
policies as in effect from time to time.
     “Guarantors” means the First Lien Guarantors and the Second Lien
Guarantors.
     “Governmental Authority” means the government of the United States, any
other nation or any political subdivision thereof, whether state or local, and
any agency, authority,
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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.
     “Hedge Agreement” means any interest rate, foreign currency, commodity or
equity swap, collar, cap, floor or forward rate agreement, or other agreement or
arrangement designed to protect against fluctuations in interest rates or
currency, commodity or equity values (including any option with respect to any
of the foregoing and any combination of the foregoing agreements or
arrangements), and any confirmation executed in connection with any such
agreement or arrangement.
     “Hedging Obligations” means obligations of any Borrower, any Guarantor or
any of their respective Subsidiaries under any Hedge Agreement entered into with
any counterparty that is (or at the time of its delivery, was) the First Lien
Agent, a First Lien Lender or an Affiliate of the First Lien Agent or any First
Lien Lender.
     “including” means “including, without limitation”.
     “Indebtedness” of any Person means, (i) all obligations of such Person for
borrowed money or advances and all obligations of such Person evidenced by
bonds, debentures, notes or similar instruments, (ii) all monetary obligations,
contingent or otherwise, relative to the face amount of all letters of credit,
whether or not drawn, and banker’s acceptances issued for the account of such
Person, (iii) all Capitalized Lease Liabilities of such Person, (iv) whether or
not so included as liabilities in accordance with GAAP, all obligations of such
Person to pay the deferred purchase price of property or services (excluding
trade accounts payable and accrued expenses in the ordinary course of business
which are not overdue for a period of more than 90 days or, if overdue for more
than 90 days, as to which a dispute exists and adequate reserves in conformity
with GAAP have been established on the books of such Person), (v) indebtedness
secured by (or for which the holder of such indebtedness has an existing right,
contingent or otherwise, to be secured by) a Lien on property owned or being
acquired by such Person (including indebtedness arising under conditional sales
or other title retention agreements), whether or not such indebtedness shall
have been assumed by such Person or is limited in recourse (provided that in the
event such indebtedness is limited in recourse solely to the property subject to
such Lien, for the purposes of this Agreement the amount of such indebtedness
shall not exceed the greater of the book value or the fair market value (as
determined in good faith by such Person’s board of directors or other managing
body) of the property subject to such Lien), (vi) monetary obligations arising
under Synthetic Leases, (vii) the full outstanding balance of trade receivables,
notes or other instruments sold with full recourse (and the portion thereof
subject to potential recourse, if sold with limited recourse), other than in any
such case any thereof sold solely for purposes of collection of delinquent
accounts and other than in connection with any Permitted Securitization (as
defined in the First Lien Financing Agreement and the Second Lien Financing
Agreement), (viii) all obligations (other than intercompany obligations) of such
Person pursuant to any Permitted Securitization (other than Standard
Securitization Undertakings (as defined in the First Lien Financing Agreement
and the Second Lien Financing Agreement)), and (ix) all Contingent Liabilities
of such Person in respect of any of the foregoing. The Indebtedness of any
Person shall include the Indebtedness of any other Person (including any
partnership in which such Person is a general partner) to the extent
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such Person is liable therefore as a result of such Person’s ownership interest
in or other relationship with such Person, except to the extent the terms of
such Indebtedness provide that such Person is not liable therefore.
     “Initial First Lien Financing Agreement” is defined in the recitals.
     “Initial Second Lien Financing Agreement” is defined in the recitals.
     “Insolvency or Liquidation Proceeding” means (i) any voluntary or
involuntary case or proceeding under the Bankruptcy Code with respect to any
Borrower or any Guarantor, (ii) any other voluntary or involuntary insolvency,
reorganization or bankruptcy case or proceeding, or any receivership,
liquidation, reorganization or other similar case or proceeding with respect to
any Borrower or any Guarantor or with respect to any of their respective assets,
(iii) any liquidation, dissolution, reorganization or winding up of any Borrower
or any Guarantor whether voluntary or involuntary and whether or not involving
insolvency or bankruptcy, or (iv) any assignment for the benefit of creditors or
any other marshalling of assets and liabilities of any Borrower or any
Guarantor.
     “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).
     “Maximum First Lien Principal Debt Amount” means $2,600,000,000.
     “Obligations” means any principal, interest, penalties, fees, indemnities,
reimbursement obligations, guarantee obligations, costs, expenses (including
fees and disbursements of counsel), damages and other liabilities and
obligations, whether direct or indirect, absolute or contingent, due or to
become due, or now existing or hereafter incurred, which may arise under, out
of, or in connection with the documentation governing, or made, delivered or
given in connection with, any Indebtedness (including interest accruing at the
then applicable rate provided in such documentation after the maturity of such
Indebtedness and interest accruing at the then applicable rate provided in such
documentation after the commencement of an Insolvency or Liquidation Proceeding
(or which would, absent the commencement of an Insolvency or Liquidation
proceeding, accrue)), relating to any Borrower or any Guarantor, whether or not
a claim for such post-filing or post-petition interest is allowed or allowable
in such Insolvency or Liquidation Proceeding.
     “Person” means any natural person, corporation, limited liability company,
partnership, joint venture, association, trust or unincorporated organization,
Governmental Authority or any other legal entity, whether acting in an
individual, fiduciary or other capacity.
     “Recovery” is defined in Section 6.5.
     “Second Lien Administrative Agent” means the “Administrative Agent” under,
and as defined in, the Second Lien Financing Agreement.
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     “Second Lien Agent” means Citibank, N.A., in its capacity as collateral
agent under the Second Lien Collateral Documents, and any successor thereto
exercising substantially the same rights and powers.
     “Second Lien Borrower” means HBI Branded Apparel Limited, Inc., a Delaware
corporation, as borrower under the Second Lien Financing Agreement.
     “Second Lien Collateral” means all of the assets and properties of the
Second Lien Borrower or any Second Lien Guarantor, now owned or hereafter
acquired, whether real, personal or mixed, in or upon which a Lien is granted or
purported to be granted to the Second Lien Agent or the Second Lien Lenders as
security for any Second Lien Obligation pursuant to the Second Lien Documents.
     “Second Lien Collateral Documents” means, collectively, the security
agreements, pledge agreements, collateral assignments, control agreements,
mortgages, deeds of trust and other documents or agreements, if any, providing
for grants or transfers for security executed and delivered by the Second Lien
Borrower, any Second Lien Guarantor or any of their respective Subsidiaries
creating a Lien upon property owned or to be acquired by the Second Lien
Borrower, such Second Lien Guarantor or such Subsidiary in favor of any holder
of Second Lien Obligations or the Second Lien Agent, in each case as security
for any Second Lien Obligations.
     “Second Lien Documents” means, collectively, the Second Lien Financing
Agreement, the Second Lien Collateral Documents and any other related document
or instrument executed or delivered pursuant to any of the foregoing at any time
or otherwise evidencing any Second Lien Obligations.
     “Second Lien Enforcement Date” means the date which is 180 days following
the date upon which the First Lien Agent receives a notice from the Second Lien
Agent certifying that (i) an Event of Default (under and as defined in the
Second Lien Financing Agreement) has occurred and is continuing, and (ii) Second
Lien Lenders holding the requisite amount of Second Lien Obligations (or the
Second Lien Agent on their behalf) have declared the Second Lien Obligations to
be due and payable prior to their stated maturity in accordance with the Second
Lien Financing Agreement; provided, that the Second Lien Enforcement Date shall
be stayed and shall not occur and shall be deemed not to have occurred (w) at
any time the First Lien Agent or the First Lien Lenders have commenced, and are
diligently pursuing, any enforcement action with respect to the Common
Collateral, (x) the First Lien Agent (or the First Lien Lenders holding the
requisite amount of First Lien Obligations) has declared the First Lien
Obligations to be due and payable prior to their stated maturity, (y) at any
time any Borrower or any Guarantor is then a debtor under or with respect to (or
otherwise subject to) any Insolvency or Liquidation Proceeding or (z) if the
acceleration of the Second Lien Obligations is rescinded in accordance with the
terms of the Second Lien Financing Agreement.
     “Second Lien Financing Agreement” means, collectively, (i) the Initial
Second Lien Financing Agreement, and (ii) any other credit agreement, loan
agreement, note agreement, promissory note, indenture, or other agreement or
instrument evidencing or
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governing the terms of any Indebtedness or other financial accommodation that
has been incurred to extend, increase (subject to the limitations set forth
herein), replace, refinance or refund in whole or in part the Indebtedness and
other obligations outstanding under the Initial Second Lien Financing Agreement
or other agreement or instrument referred to in this clause. Any reference to
the Second Lien Financing Agreement hereunder shall be deemed a reference to any
Second Lien Financing Agreement then in existence.
     “Second Lien Guarantor” means each Person that is (or hereafter becomes) a
guarantor of the Second Lien Obligations pursuant to the Second Lien Documents.
Upon becoming a guarantor thereunder such Person shall automatically be deemed
to be a Second Lien Guarantor for all purposes hereunder.
     “Second Lien Lender” is defined in the recitals and in addition shall
include any Person holding Second Lien Obligations.
     “Second Lien Obligations” means, collectively, (i) all Indebtedness
outstanding under or with respect to the Second Lien Documents, and (ii) all
other Obligations owing by the Second Lien Borrower or any Second Lien Guarantor
under or with respect to the Second Lien Financing Agreement or any other Second
Lien Documents, including all claims under the Second Lien Documents for
interest, fees, expense reimbursements, indemnification and other similar
claims. Second Lien Obligations shall include all interest accrued or accruing
(or which would, absent the commencement of an Insolvency or Liquidation
Proceeding, accrue) after the commencement of an Insolvency or Liquidation
Proceeding in accordance with and at the rate specified in the Second Lien
Financing Agreement whether or not the claim for such interest is allowed as a
claim in such Insolvency or Liquidation Proceeding. To the extent any payment
with respect to the Second Lien Obligations (whether by or on behalf of the
Second Lien Borrower or any Second Lien Guarantor, as proceeds of security,
enforcement of any right of setoff or otherwise) is declared to be a fraudulent
conveyance or a preference in any respect, set aside or required to be paid to a
debtor in possession, First Lien Agent, receiver or similar Person, then the
Obligation or part thereof originally intended to be satisfied shall be deemed
to be reinstated and outstanding as if such payment had not occurred.
     “Second Lien Required Lenders” means with respect to any amendment or
modification of the Second Lien Financing Agreement or this Agreement, or any
termination or waiver of any provision of the Second Lien Financing Agreement or
this Agreement, or any consent or departure by the Second Lien Borrower or the
Second Lien Guarantors, as the case may be, therefrom (in each case exclusive of
any such modification, waiver, consent, etc., which is permitted to be effected
by the Second Lien Administrative Agent and the Second Lien Borrower without
further approval or consent of any Second Lien Lenders), those Second Lien
Lenders, the approval of which is required pursuant to the Second Lien Financing
Agreement to approve such amendment or modification, termination or waiver or
consent or departure.
     “Second Lien Security Agreement” means, collectively, the security
agreements, pledge agreements or similar collateral documents by which the
Second Lien Agent obtains a Lien or security interest in the Common Collateral
for the benefit of the Second Lien Lenders.
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     “Subsidiary” means, with respect to any Person, any other Person of which
more than 50% of the outstanding Voting Securities of such other Person
(irrespective of whether at the time Capital Securities of any other class or
classes of such other Person shall or might have voting power upon the
occurrence of any contingency) is at the time directly or indirectly owned or
controlled by such Person, by such Person and one or more other Subsidiaries of
such Person, or by one or more other Subsidiaries of such Person.
     “Synthetic Lease” means, as applied to any Person, any lease (including
leases that may be terminated by the lessee at any time) of any property
(whether real, personal or mixed) (i) that is not a capital lease in accordance
with GAAP and (ii) in respect of which the lessee retains or obtains ownership
of the property so leased for federal income tax purposes, other than any such
lease under which that Person is the lessor.
     “Uniform Commercial Code” or “UCC” means the Uniform Commercial Code as in
effect from time to time in the State of New York or any other applicable
jurisdiction.
     “United States” means the United States of America, its fifty states and
the District of Columbia.
     “Voting Securities” means, with respect to any Person, Capital Securities
of any class or kind ordinarily having the power to vote for the election of
directors, managers or other voting members of the governing body of such
Person.
     SECTION 1.2. UCC Defined Terms. In addition, the following terms which are
defined in the Uniform Commercial Code are used herein as so defined:
Certificated Security, Deposit Account, Instrument and Investment Property.
     SECTION 1.3. Definitions (Generally). The definitions of terms herein shall
apply equally to the singular and plural forms of the terms defined. 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 this
Agreement) herein shall be construed as referring to such agreement, instrument
or other document as from time to time amended, extended, supplemented,
restated, replaced or otherwise modified (subject to any restrictions on such
amendments, extensions, supplements, restatements, replacements or modifications
set forth herein), (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, shall be construed to refer to
this Agreement in its entirety and not to any particular provision thereof,
(iv) all references herein to Sections shall be construed to refer to Sections
of this Agreement, (v) 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
contracts, and (vi) any reference to any law, rule, regulation, statute, code,
ordinance or treaty shall include any statutory or regulatory provisions
consolidating, amending, replacing, supplementing or interpreting any of the
foregoing.
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ARTICLE II
LIEN PRIORITIES
     SECTION 2.1. Lien Priority.
     (a) Priority. Notwithstanding (i) the date, time, method, manner or order
of grant, attachment or perfection (or failure to perfect) of any Liens granted
to the Second Lien Agent or the Second Lien Lenders on all or any portion of the
Common Collateral or of any Liens granted to the First Lien Agent or the First
Lien Lenders on all or any portion of the Common Collateral, and regardless of
how such Lien was acquired (whether by grant, statute, operation of law,
subrogation or otherwise), (ii) the order or time of filing or recordation of
any document or instrument for perfecting the Liens in favor of the First Lien
Agent or the Second Lien Agent (or any First Lien Lender or Second Lien Lender)
in any Common Collateral, (iii) any provision of the UCC, the Bankruptcy Code or
any applicable law, the First Lien Documents or the Second Lien Documents,
(iv) whether the First Lien Agent or the Second Lien Agent, in each case, either
directly or through agents, holds possession of, or has control over, all or any
part of the Common Collateral, (v) the fact that any Liens in favor of the First
Lien Agent or the First Lien Lenders securing any of the First Lien Obligations
are (A) subordinated to any Lien securing any obligation of any Borrower or any
Guarantor other than the First Lien Obligations or (B) otherwise subordinated,
voided, avoided, invalidated, or lapsed, or (vi) any other circumstance
whatsoever, the Second Lien Agent, on behalf of itself and the Second Lien
Lenders, hereby agrees that: (x) any Lien on any Common Collateral securing the
First Lien Obligations now or hereafter held by the First Lien Agent or the
First Lien Lenders shall be senior in priority to all Liens on any Common
Collateral securing the Second Lien Obligations; and (y) any Lien on any Common
Collateral now or hereafter held by the Second Lien Agent or the Second Lien
Lenders shall be and are expressly junior and subordinate in priority to any and
all Liens on any Common Collateral securing the First Lien Obligations.
     (b) Effect of Perfection or Failure to Perfect. Notwithstanding any failure
by the First Lien Agent, any First Lien Lender, the Second Lien Agent or any
Second Lien Lender to perfect its security interests in any Common Collateral or
any avoidance, invalidation or subordination by any third party or court of the
security interests in any Common Collateral granted to any such Person, the
priority and rights as between the First Lien Agent and the First Lien Lenders
on the one hand and the Second Lien Agent and the Second Lien Lenders on the
other hand with respect to any Common Collateral shall be as set forth in this
Agreement.
     (c) Nature of First Lien Obligations. The Second Lien Agent on behalf of
itself and the Second Lien Lenders acknowledges that a portion of the First Lien
Obligations are revolving in nature and that the amount thereof that may be
outstanding at any time or from time to time may be increased or reduced and
subsequently reborrowed, and that the terms of the First Lien Obligations may be
modified, extended or amended from time to time, and (subject to the proviso in
the definition of First Lien Financing Agreement) the aggregate amount of the
First Lien Obligations may be increased, replaced or refinanced, in each event,
without notice to or consent by the Second Lien
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Agent or any Second Lien Lender and without affecting the provisions hereof. The
lien priorities provided in this Section shall not be altered or otherwise
affected by any such amendment, modification, supplement, extension, repayment,
reborrowing, increase, replacement, renewal, restatement or refinancing of
either the First Lien Obligations or the Second Lien Obligations, or any portion
thereof.
     SECTION 2.2. Prohibition on Contesting Liens. The Second Lien Agent, for
itself and on behalf of each Second Lien Lender, and the First Lien Agent, for
itself and on behalf of each First Lien Lender, each agrees that it shall not
(and hereby waives any right to) directly or indirectly contest or support any
other Person in contesting, or objecting to, in any proceeding (including any
Insolvency or Liquidation Proceeding), the priority, perfection, validity or
enforceability of any Lien in any Common Collateral granted to the other, or the
provisions of this Agreement.
     SECTION 2.3. No New Liens.
     (a) Limitation on other Collateral for First Lien Lenders. So long as any
Second Lien Obligations remain outstanding, and subject to Section 6 hereof,
(i) the First Lien Agent agrees that, after the date hereof, neither the First
Lien Agent nor any First Lien Lender shall acquire or hold any Lien (other than
cash collateralization of any First Lien Obligation consisting of letters of
credit, Hedging Obligations or Bank Product Obligations) on any assets of any
Borrower, any Guarantor or any of their respective Subsidiaries securing any
First Lien Obligations which assets are not also subject to the second-priority
Lien of the Second Lien Agent under the Second Lien Documents, and (ii) each
Borrower and each Guarantor agrees not to grant any Lien on any of its assets,
or permit any of its Subsidiaries to grant a Lien (other than cash
collateralization of any First Lien Obligation consisting of letters of credit,
Hedging Obligations or Bank Product Obligations) on any of its assets, in favor
of the First Lien Agent or the First Lien Lenders securing the First Lien
Obligations unless it, or such Subsidiary, has granted a similar Lien on such
assets in favor of the Second Lien Agent or the Second Lien Lenders securing the
Second Lien Obligations. If the First Lien Agent or any First Lien Lender shall
acquire any Lien (other than cash collateralization of any First Lien Obligation
consisting of letters of credit, Hedging Obligations or Bank Product
Obligations) on any assets of any Borrower, any Guarantor or any of their
respective Subsidiaries securing any First Lien Obligations which assets are not
also subject to the second-priority Lien of the Second Lien Agent under the
Second Lien Documents, then the First Lien Agent (or the relevant First Lien
Lender), shall, without the need for any further consent of any other Person and
notwithstanding anything to the contrary in any other First Lien Document (A) be
deemed to hold and have held such Lien for the benefit of the Second Lien Agent
as security for the Second Lien Obligations subject to the priorities and other
terms set forth herein or (B) release such Lien.
     (b) Limitation on other Collateral for Second Lien Lenders. Until the date
upon which the Discharge of First Lien Obligations shall have occurred, (i) the
Second Lien Agent agrees that, after the date hereof, neither the Second Lien
Agent nor any Second Lien Lender shall acquire or hold any Lien on any assets of
any Borrower, any Guarantor or any of their respective Subsidiaries securing any
Second Lien
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Obligations which assets are not also subject to the first-priority Lien of the
First Lien Agent securing the First Lien Obligations, and (ii) each Borrower and
each Guarantor agrees not to grant any Lien on any of its assets, or permit any
of its Subsidiaries to grant a Lien on any of its assets, in favor of the Second
Lien Agent or the Second Lien Lenders securing the Second Lien Obligations
unless it, or such Subsidiary, has granted a similar Lien on such assets in
favor of the First Lien Agent or the First Lien Lenders. If the Second Lien
Agent or any Second Lien Lender shall acquire any Lien on any assets of any
Borrower, any Guarantor or any of their respective Subsidiaries securing any
Second Lien Obligations which assets are not also subject to the first-priority
Lien of the First Lien Agent securing the First Lien Obligations, then the
Second Lien Agent (or the relevant Second Lien Lender), shall, without the need
for any further consent of any other Person and notwithstanding anything to the
contrary in any other Second Lien Document (A) be deemed to hold and have held
such Lien for the benefit of the First Lien Agent as security for the First Lien
Obligations subject to the priorities and other terms set forth herein or
(B) release such Lien.
     SECTION 2.4. Similar Liens and Agreements. The parties hereto agree that it
is their intention that the First Lien Collateral and the Second Lien Collateral
be identical. In furtherance of the foregoing, the parties hereto agree:
     (a) upon request of the First Lien Agent or the Second Lien Agent, to
cooperate in good faith (and to direct their counsel and agents to cooperate in
good faith) from time to time in order to determine the specific items included
in the First Lien Collateral and the Second Lien Collateral and the steps taken
to perfect their respective Liens thereon and the identity of the respective
grantors with respect thereto; and
     (b) that the terms and provisions contained in the documents and agreements
creating or evidencing the First Lien Collateral and the Second Lien Collateral
shall be in all material respects be the same forms of documents other than with
respect to the priority of the Liens thereunder.
ARTICLE III
ENFORCEMENT, STANDSTILL, WAIVERS
     SECTION 3.1. Standstill and Waivers. Until the earlier of (i) the date upon
which the Discharge of First Lien Obligations shall have occurred, whether or
not any Insolvency or Liquidation Proceeding has been commenced by or against
any Borrower, any Guarantor or any of their respective Subsidiaries, or (ii) the
Second Lien Enforcement Date, neither the Second Lien Agent nor the Second Lien
Lenders:
     (a) will oppose, object to or contest in any manner, any foreclosure, sale,
lease, exchange, transfer or other disposition of any Common Collateral by the
First Lien Agent or any First Lien Lender, or any other exercise of any rights
or remedies by or on behalf of the First Lien Agent or any First Lien Lender in
respect of any Common Collateral, including the commencement or prosecution of
any enforcement action under applicable law or the First Lien Documents;
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     (b) shall have any right to (1) direct either the First Lien Agent or any
First Lien Lender to exercise any right, remedy or power with respect to any
Common Collateral or pursuant to the First Lien Documents or (2) contest or
object to the exercise by the First Lien Agent or any First Lien Lender of any
right, remedy or power with respect to any Common Collateral or pursuant to the
First Lien Documents or to the timing or manner in which any such right is
exercised or not exercised (and, to the extent they may have any such right
described in this clause, whether as a junior lien creditor or otherwise, they
hereby irrevocably waive such right);
     (c) will institute any suit or other proceeding or assert in any suit,
Insolvency or Liquidation Proceeding or other proceeding any claim against the
First Lien Agent or any First Lien Lender seeking damages from or other relief
by way of specific performance, instructions or otherwise, with respect to, and
none of the First Lien Agent nor any First Lien Lender shall be liable for, any
action taken or omitted to be taken by the First Lien Agent or any First Lien
Lender with respect to any Common Collateral or pursuant to the First Lien
Documents; provided, that this provision shall not prevent the Second Lien Agent
on behalf of the Second Lien Lenders from asserting claims against the First
Lien Agent for damages arising from its gross negligence or willful misconduct
in performing its duties and obligations hereunder;
     (d) will take, receive or accept any Common Collateral or any proceeds of
any Common Collateral, except in accordance with the provisions of this
Agreement;
     (e) will commence judicial or nonjudicial foreclosure proceedings with
respect to, seek to have a trustee, receiver, liquidator or similar official
appointed for or over, attempt any action to take possession of any Common
Collateral, exercise any right, remedy or power with respect to, or otherwise
take any action to enforce their interest in or realize upon, any Common
Collateral or pursuant to the Second Lien Documents; or
     (f) will seek, and hereby waive any right, to have the Common Collateral or
any part thereof marshaled upon any foreclosure or other disposition of any
Common Collateral.
     SECTION 3.2. Exclusive Enforcement; Nature of Rights.
     (a) Limitation on Action by Second Lien Lenders. Until the earlier of
(i) the date upon which the Discharge of First Lien Obligations shall have
occurred, whether or not any Insolvency or Liquidation Proceeding has been
commenced by or against any Borrower, any Guarantor or any of their respective
Subsidiaries, or (ii) the Second Lien Enforcement Date, the Second Lien Agent
agrees, on behalf of itself and the Second Lien Lenders, that the First Lien
Agent and the First Lien Lenders shall have the exclusive right to enforce
rights, exercise remedies (including setoff) and make determinations regarding
release (in connection with any such enforcement of rights or exercise of
remedies), disposition, or restrictions with respect to any Common Collateral
without any consultation with or the consent of the Second Lien Agent or any
Second Lien Lender; provided, that in each case (subject to the provisions of
Section 6), (A)
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in any Insolvency or Liquidation Proceeding commenced by or against the Second
Lien Borrower or any Second Lien Guarantor, the Second Lien Agent may file a
claim or statement of interest with respect to the Second Lien Obligations,
(B) the Second Lien Agent may take any action (not adverse to the senior Liens
on any Common Collateral securing the First Lien Obligations or the rights of
the First Lien Agent to exercise remedies in respect thereof) in order to
preserve or protect its Lien on any Common Collateral, (C) the Second Lien Agent
shall be entitled to file any necessary responsive or defensive pleadings in
opposition to any motion, claim, adversary proceeding or other pleading made by
any Person objecting to or otherwise seeking the disallowance of the claims of
the Second Lien Lenders or the Second Lien Agent, including any claims secured
by any Common Collateral, in each case in accordance with the terms of this
Agreement, (D) the Second Lien Agent and the Second Lien Lenders shall be
entitled to file any pleadings, objections, motions or agreements which assert
rights or interests available to unsecured creditors of the Second Lien Borrower
and the Second Lien Guarantors arising under either bankruptcy or non-bankruptcy
law, except as specifically prohibited herein, (E) the Second Lien Lenders and
the Second Lien Agent shall be entitled to file any proof of claim and other
filings and make any agreements and motions that are, in each case, in
accordance with the terms of this Agreement, and (F) the Second Lien Lenders and
the Second Lien Agent may exercise any of their rights and remedies with respect
to any Common Collateral after the Second Lien Enforcement Date and so long as
the Second Lien Enforcement Date has not been suspended pursuant to the
definition thereof.
In exercising rights and remedies with respect to any Common Collateral, the
First Lien Agent and the First Lien Lenders may enforce the provisions of the
First Lien Documents and exercise remedies thereunder, all in such order and in
such manner as they may determine in the exercise of their sole discretion. Such
exercise and enforcement shall include the rights of an agent appointed by them
to sell or otherwise dispose of Common Collateral upon foreclosure, to incur
expenses in connection with such sale or disposition, and to exercise all the
rights and remedies of a secured party under the Uniform Commercial Code of any
applicable jurisdiction and of a secured creditor under bankruptcy or similar
laws of any applicable jurisdiction.
     (b) Permitted Action by Second Lien Lenders. Without limiting the
generality of the foregoing provisions of this Section, until the earlier of
(i) the date upon which the Discharge of First Lien Obligations shall have
occurred, whether or not any Insolvency or Liquidation Proceeding has been
commenced by or against any Borrower, any Guarantor or any of their respective
Subsidiaries, or (ii) the Second Lien Enforcement Date, and subject to any other
rights set forth herein, the sole right of the Second Lien Agent and the Second
Lien Lenders with respect to any Common Collateral is to hold a Lien on any
Common Collateral pursuant to the Second Lien Documents for the period and to
the extent granted therein and to receive a share of the proceeds thereof, if
any, as set forth herein.
     SECTION 3.3. No Additional Rights For the Borrower Hereunder. Except as
provided in Section 3.4, if the First Lien Agent or any
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First Lien Lender or Second Lien Agent or any Second Lien Lender enforces its
rights or remedies in violation of the terms of this Agreement, neither any
Borrower nor any Guarantor shall be entitled to use such violation as a defense
to any action by the First Lien Agent or any First Lien Lender or Second Lien
Agent or any Second Lien Lender, nor to assert such violation as a counterclaim
or basis for set off or recoupment against the First Lien Agent or any First
Lien Lender or Second Lien Agent or any Second Lien Lender.
     SECTION 3.4. Actions Upon Breach.
     (a) If any Second Lien Lender or Second Lien Agent or First Lien Lender or
First Lien Agent, contrary to this Agreement, commences or participates in any
action or proceeding against any Borrower or any Guarantor or the Common
Collateral, such Borrower or Guarantor, with the prior written consent of the
First Lien Agent or the Second Lien Agent, as applicable, may interpose as a
defense or dilatory plea the making of this Agreement, and any First Lien Lender
or the First Lien Agent or Second Lien Lender or the Second Lien Agent, as
applicable, may intervene and interpose such defense or plea in its or their
name or in the name of such Borrower or Guarantor.
     (b) Should any Second Lien Lender or the Second Lien Agent, contrary to
this Agreement, in any way take, attempt to or threaten to take any action with
respect to the Common Collateral (including, without limitation, any attempt to
realize upon or enforce any remedy with respect to this Agreement), or fail to
take any action required by this Agreement, any First Lien Lender or First Lien
Agent (in its own name or in the name of the relevant Borrower or Guarantor) or
the relevant Borrower or Guarantor may obtain relief against such Second Lien
Lender or the Second Lien Agent, as applicable, by injunction, specific
performance and/or other appropriate equitable relief, it being understood and
agreed by the Second Lien Agent on behalf of each Second Lien Lender and itself
that (i) the First Lien Lenders’ or the First Lien Agent’s damages from its
actions may at that time be difficult to ascertain and may be irreparable, and
(ii) each Second Lien Lender and the Second Lien Agent waive any defense that
the Borrowers or Guarantors and/or the First Lien Lenders or the First Lien
Agent cannot demonstrate damage and/or be made whole by the awarding of damages.
     (c) Should any First Lien Lender or First Lien Agent, contrary to this
Agreement, in any way take, attempt to or threaten to take any action with
respect to the Common Collateral (including, without limitation, any attempt to
realize upon or enforce any remedy with respect to this Agreement), or fail to
take any action required by this Agreement, any Second Lien Lender or the Second
Lien Agent (in its own name or in the name of the relevant Borrower or
Guarantor) or the relevant Borrower or Guarantor may obtain relief against such
First Lien Lender or the First Lien Agent, as applicable, by injunction,
specific performance and/or other appropriate equitable relief, it being
understood and agreed by the First Lien Agent on behalf of each First Lien
Lender and itself that (i) the Second Lien Lender’s and the Second Lien Agent’s
damages from its actions may at that time be difficult to ascertain and may be
irreparable, and (ii) each First Lien Lender and the First Lien Agent waive any
defense that the Borrowers or Guarantors and/or the Second Lien Lenders or the
Second Lien Agent cannot demonstrate damage and/or be made whole by the awarding
of damages.
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ARTICLE IV
PAYMENTS
     SECTION 4.1. Application of Proceeds. Until the date upon which the
Discharge of First Lien Obligations shall have occurred (except as specifically
provided in the First Lien Documents and in the Second Lien Documents), the cash
proceeds of Common Collateral received in connection with the sale or
disposition of, or collection on, such Common Collateral and whether or not
pursuant to any exercise of remedies or any Insolvency or Liquidation
Proceeding, shall be applied by the First Lien Agent to the First Lien
Obligations and, to the extent applicable, to the Second Lien Agent for
application to the Second Lien Obligations in such order as specified in the
First Lien Documents. Upon the Discharge of First Lien Obligations, the First
Lien Agent shall deliver to the Second Lien Agent any proceeds of Common
Collateral held by it in the same form as received, with any necessary
endorsements or as a court of competent jurisdiction may otherwise direct. Upon
the Discharge of the Second Lien Obligations, the Second Lien Agent shall
deliver to the applicable Borrower or Guarantor any proceeds of Common
Collateral held by it in the same form as received, with any necessary
endorsements or as a court of competent jurisdiction may otherwise direct.
     SECTION 4.2. Payments Over. Until the date upon which the Discharge of
First Lien Obligations has occurred, any Common Collateral or proceeds thereof
received by the Second Lien Agent or any Second Lien Lender in contravention of
this Agreement shall be segregated and held in trust and forthwith paid over to
the First Lien Agent for the benefit of the First Lien Lenders in the same form
as received, with any necessary endorsements or as a court of competent
jurisdiction may otherwise direct. Until the date upon which the Discharge of
First Lien Obligations shall have occurred, the First Lien Agent is hereby
authorized to make any such endorsements as agent for the Second Lien Agent or
such Second Lien Lender.
ARTICLE V
OTHER AGREEMENTS
     SECTION 5.1. Releases.
     (a) Until the date upon which the Discharge of First Lien Obligations shall
have occurred, if:
     (i) the First Lien Agent exercises any of its remedies in respect of any
Common Collateral in accordance with the terms of this Agreement, including any
sale, lease, exchange, transfer or other disposition of such Common Collateral;
     (ii) there occurs any sale, lease, exchange, transfer or other disposition
of Common Collateral to a Person other than a Borrower or a Guarantor in a
transaction that is permitted under the terms of the First Lien Financing
Agreement and the Second Lien Financing Agreement (whether or not in either case
an event of default under, and as defined therein, has occurred and is
continuing) at the time of such transaction; or
     (iii) the Common Collateral to be released consists of the assets of a
Subsidiary of a Borrower or a Guarantor all of the Capital Securities of which
is being released pursuant to any other provision of this clause;
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and if, in connection therewith, the First Lien Agent, for itself or on behalf
of any of the First Lien Lenders, releases any of its Liens on any part of the
Common Collateral, or releases any Guarantor from its obligations under its
guaranty of the First Lien Obligations (other than in connection with the
Discharge of First Lien Obligations), the Liens, if any, of the Second Lien
Agent, for itself or for the benefit of the Second Lien Lenders, on such Common
Collateral, and the obligations of such Guarantor under its guaranty of the
Second Lien Obligations, shall be automatically, unconditionally and
simultaneously released with no further consent or action of any Person, and the
Second Lien Agent, for itself or on behalf of any such Second Lien Lender,
promptly shall execute and deliver to the First Lien Agent and the Borrowers
such termination statements, releases and other documents and shall take such
further actions as the First Lien Agent, the Borrowers or such Guarantor may
reasonably request to effectively confirm such release.
     (b) The Second Lien Agent, for itself and on behalf of the Second Lien
Lenders, hereby irrevocably constitutes and appoints the First Lien Agent and
any officer or agent of the First Lien Agent, with full power of substitution,
as its true and lawful attorney-in-fact with full irrevocable power and
authority in the place and stead of the Second Lien Agent or such Second Lien
Lender or in the First Lien Agent’s own name, from time to time, in the First
Lien Agent’s discretion, for the purpose of carrying out the terms of this
Section, to take any and all appropriate action and to execute any and all
documents and instruments which may be necessary or desirable to accomplish the
purposes of this Section including, without limitation, any financing
statements, endorsements or other instruments or transfer or release. This
appointment is coupled with an interest.
     SECTION 5.2. Insurance. To the extent provided in the relevant First Lien
Collateral Documents or the Second Lien Collateral Documents, as the case may
be, the First Lien Agent and the Second Lien Agent shall be named as additional
insureds and the Control Agent shall be named as loss payee (on behalf of the
First Lien Agent, the First Lien Lenders, the Second Lien Agent and the Second
Lien Lenders) under any insurance policies maintained from time to time by the
Borrower or Guarantors. Until the date upon which the Discharge of First Lien
Obligations shall have occurred, as between the First Lien Agent and the First
Lien Lenders, on the one hand, and the Second Lien Agent and the Second Lien
Lenders on the other, the First Lien Agent and the First Lien Lenders shall have
the sole and exclusive right to the extent provided for in the First Lien
Documents (i) to adjust or settle any insurance policy or claim covering any
Common Collateral in the event of any loss thereunder; and (ii) to approve any
award granted in any condemnation or similar proceeding affecting any Common
Collateral. Until the date upon which the Discharge of First Lien Obligations
shall have occurred, all proceeds of any such policy and any such award in
respect of any Common Collateral that are payable to the First Lien Agent and
the Second Lien Agent shall be paid to the First Lien Agent for the benefit of
the First Lien Lenders to the extent required under the First Lien Documents
and, thereafter, to the Second Lien Agent for the benefit of the Second Lien
Lenders to the extent required under the applicable Second Lien Documents and
then to the applicable Borrower or Guarantor or as a court of competent
jurisdiction may otherwise direct. If the Second Lien Agent or any Second Lien
Lender shall, at any time, receive any proceeds of any such insurance policy or
any such award in contravention of this Agreement, it shall pay such proceeds
over to the First Lien Agent in accordance with the terms of Section 4.2.
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     SECTION 5.3. Amendments to Second Lien Collateral Documents.
     (a) Until the date upon which the Discharge of First Lien Obligations shall
have occurred, without the prior written consent of the First Lien Agent, no
Second Lien Collateral Document may be amended, supplemented or otherwise
modified or entered into to the extent such amendment, supplement or
modification, or the terms of any new Second Lien Financing Agreement or Second
Lien Collateral Document, would contravene any of the terms of this Agreement.
The Second Lien Agent agrees that each Second Lien Collateral Document shall
include the following language:
“Notwithstanding anything herein to the contrary, the lien and security interest
granted to the Collateral Agent pursuant to this Agreement and the exercise of
any right or remedy by the Collateral Agent hereunder are subject to the
provisions of the Intercreditor Agreement, dated as of the date hereof, as the
same may be amended, restated, supplemented, modified or replaced from time to
time (the “Intercreditor Agreement”) among Citibank, N.A., as First Lien Agent,
Citibank, N.A., as Second Lien Agent, Citibank, N.A., as Control Agent, the
First Lien Borrower, the First Lien Guarantors, the Second Lien Borrower and the
Second Lien Guarantors (each as defined therein) from time to time a party
thereto. In the event of any conflict between the terms of the Intercreditor
Agreement and this Agreement, the terms of the Intercreditor Agreement shall
govern.”
     In addition, the Second Lien Agent agrees that each Second Lien Collateral
Document under which any Lien on real property owned by the Second Lien Borrower
or any Second Lien Guarantor is granted to secure the Second Lien Obligations
covering any Common Collateral shall contain such other language as the First
Lien Agent may reasonably request to reflect the priority of the First Lien
Collateral Document covering such Common Collateral over such Second Lien
Collateral Document.
     (b) Without the prior written consent of the First Lien Agent (and any
required consent of the First Lien Lenders), no Second Lien Document may be
amended, supplemented or otherwise modified to the extent such amendment,
supplement or modification would (i) increase the then outstanding aggregate
principal amount of the loans under the Second Lien Financing Agreement to an
amount exceeding $450,000,000, (ii) contravene the provisions of this Agreement,
(iii) increase the “Applicable Margin” or similar component of the interest on
the loans thereunder by more than 3.0% per annum (exclusive, for the avoidance
of doubt, of any imposition of up to 2.0% of “default” interest), (iv) provide
for dates for payment of principal, interest, premium (if any) or fees which are
earlier than such dates under the Second Lien Financing Agreement, (v) provide
for covenants, events of default or remedies which are more restrictive on any
Guarantor than those set forth in the Second Lien Financing Agreement,
(vi) provide for redemption, prepayment or defeasance provisions that are more
burdensome on any Guarantor than those set forth in the Second Lien Financing
Agreement, (vii) provide for collateral securing Indebtedness thereunder which
is more extensive than the collateral provided with respect to the First Lien
Financing Agreement or (viii) increase the obligations of any Guarantor (except
as set forth herein) or confer
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any additional rights on any Second Lien Lender which could reasonably be
expected to be adverse to the First Lien Lender.
     (c) Without the prior written consent of the Second Lien Agent (and any
required consent of the Second Lien Lenders), no First Lien Document may be
amended, supplemented or otherwise modified to the extent such amendment,
supplement or modification would (i) contravene the provisions of this
Agreement, (ii) increase the then outstanding aggregate principal amount of the
loans under the First Lien Financing Agreement plus, if any, any undrawn portion
of any commitment under the First Lien Financing Agreement in excess of the
Maximum First Lien Principal Amount or (iii) increase the “Applicable Margin” or
similar component of the interest of the loans thereunder by more than 3.0% per
annum from the “Applicable Margin” or similar component of the interest under
the First Lien Financing Agreement as in effect as of the date hereof
(exclusive, for the avoidance of doubt, of any imposition of up to 2.0% of
“default” interest).
     SECTION 5.4. Rights as Unsecured Creditors and Judgment Creditors.
     (a) Except as otherwise expressly set forth in Section 3.1 and Section 3.2
and subject to Article VI, (i) the Second Lien Agent and the Second Lien Lenders
may exercise all rights and remedies as unsecured creditors against the Second
Lien Borrower, the Second Lien Guarantors or any of their Subsidiaries in
accordance with the terms of the Second Lien Documents and applicable law and
this Agreement, and (ii) nothing in this Agreement shall prohibit the
acceleration of the obligations under the Second Lien Documents or the receipt
of the Second Lien Agent or the Second Lien Lenders of the required payments of
principal and interest and other amounts, so long as such receipt is not the
direct or indirect result of the exercise of the Second Lien Agent or any Second
Lien Lender of rights and remedies as a secured creditor or enforcement in
contravention of this Agreement of any Lien held by any of them.
     (b) In the event the Second Lien Agent or any Second Lien Lender becomes a
judgment lien creditor in respect of Common Collateral as a result of its
enforcement of its rights as an unsecured creditor, such judgment lien shall be
subject to the terms of this Agreement for all purposes and shall be junior to
the Liens securing First Lien Obligations on the same basis as the other Liens
securing the Second Lien Obligations are junior to such First Lien Obligations
under this Agreement. Nothing in this Agreement modifies any rights or remedies
the First Lien Agent or the First Lien Lenders may have with respect to the
First Lien Collateral.
     SECTION 5.5. Limited Agency of Citibank, N.A. for Perfection.
     (a) The First Lien Agent, on behalf of itself and the First Lien Lenders,
and the Second Lien Agent, on behalf of itself and the Second Lien Lenders, each
hereby appoint Citibank, N.A. as its collateral agent (in such capacity,
together with any successor in such capacity appointed by the First Lien Agent
and consented to by the Second Lien Agent (such consent not to be unreasonably
withheld or delayed), the “Control Agent”) for the limited purpose of acting as
the agent on behalf of the First Lien Agent (on behalf of
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itself and the First Lien Lenders) and the Second Lien Agent (on behalf of
itself and the Second Lien Lenders) with respect to the Control Collateral for
purposes of perfecting the Liens of such parties on the Control Collateral. The
Control Agent accepts such appointment and agrees to hold the Control Collateral
that is part of the Common Collateral in its possession or control (or in the
possession or control of its agents or bailees) as Control Agent for the benefit
of the First Lien Agent (on behalf of itself and the First Lien Lenders) and the
Second Lien Agent (on behalf of itself and the Second Lien Lenders) and any
permitted assignee of any thereof solely for the purpose of perfecting the
security interest granted to such parties in such Control Collateral, subject to
the terms and conditions of this Section. The Control Agent, the First Lien
Agent, on behalf of itself and the First Lien Lenders, and the Second Lien
Agent, on behalf of itself and the Second Lien Lenders, each hereby agrees that
the First Lien Agent shall have the sole and exclusive right and authority to
give instructions to, and otherwise direct, the Control Agent in respect of the
Control Collateral or any control agreement with respect to any Control
Collateral until the earlier of the date upon which the Discharge of First Lien
Obligations shall have occurred and the Second Lien Enforcement Date, and
neither the Second Lien Agent nor any Second Lien Lender will hinder, delay or
interfere with the exercise of such rights by the First Lien Agent in any
respect. The First Lien Agent and the Second Lien Agent hereby acknowledge that
the Control Agent will obtain “control” under the UCC over each Controlled
Account as contemplated by the First Lien Collateral Documents and the Second
Lien Collateral Documents for the benefit of both the First Lien Agent (on
behalf of itself and the First Lien Lenders) and the Second Lien Agent (on
behalf of itself and the Second Lien Lenders) pursuant to the control agreements
relating to each respective Controlled Account. The Borrowers hereby agree to
pay, reimburse, indemnify and hold harmless the Control Agent to the same extent
and on the same terms that the First Lien Borrower is required to do so for the
First Lien Agent in accordance with the First Lien Financing Agreement. The
First Lien Agent and the Second Lien Agent hereby also acknowledge and agree
that the Control Agent, to the extent it receives landlord lien waivers, will
receive such landlord lien waivers for the benefit of the Second Lien Agent for
the benefit of Second Lien Lenders and the First Lien Agent for the benefit of
the First Lien Lenders. Except as set forth below, the Control Agent shall have
no obligation whatsoever to the Second Lien Agent or any Second Lien Lender
including any obligation to assure that the Control Collateral is genuine or
owned by any Borrower, any Guarantor or one of their respective Subsidiaries or
to preserve rights or benefits of any Second Lien Lender or the Second Lien
Agent except as expressly set forth in this Section. In acting on behalf of the
Second Lien Agent and the Second Lien Lenders, the duties or responsibilities of
the Control Agent under this Section shall be limited solely (i) to physically
holding the Control Collateral delivered to the Control Agent by the Borrowers,
Guarantors or any Subsidiary of such Person as agent for the Second Lien Agent
(on behalf of itself and the Second Lien Lenders) for purposes of perfecting the
Lien held by the Second Lien Agent (on behalf of itself and the Second Lien
Lenders) and (ii) delivering such collateral as set forth in clause (d) of
Section 5.5.
     (b) The rights of the Second Lien Agent shall at all times be subject to
the terms of this Agreement and to the First Lien Agent’s rights under the First
Lien Documents.
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     (c) The First Lien Agent shall not have by reason of the Second Lien
Security Agreement or this Agreement or any other document a fiduciary
relationship in respect of the Second Lien Agent or any Second Lien Lender.
     (d) Upon the Discharge of First Lien Obligations, the Control Agent shall
deliver to the Second Lien Agent the Control Collateral together with any
necessary endorsements (or otherwise allow the Second Lien Agent to obtain
control of such Control Collateral) or as a court of competent jurisdiction may
otherwise direct.
     (e) Upon the Discharge of the Second Lien Obligations, the Control Agent
shall deliver to the applicable Borrower or Guarantor the Control Collateral
together with any necessary endorsements or as a court of competent jurisdiction
may otherwise direct.
     SECTION 5.6. Inspection Rights. Subject to the First Lien Documents and the
Second Lien Documents, and solely between the First Lien Agent and the First
Lien Lenders, on the one hand, and the Second Lien Agent and the Second Lien
Lenders, on the other hand,
     (a) the First Lien Agent and its representatives and invitees may at any
time inspect, repossess, remove and otherwise deal with the Common Collateral,
and the First Lien Agent may advertise and conduct public auctions or private
sales of any Common Collateral, in each case without notice to (except as
provided in Section 7.5), the involvement of or interference by the Second Lien
Agent or any Second Lien Lender or liability to the Second Lien Agent or any
Second Lien Lender.
     (b) The Second Lien Agent may inspect the Common Collateral, in accordance
with Second Lien Documents, so long as such inspection does not interfere with
the rights of the First Lien Agent under Section 3.1 or under the First Lien
Documents.
ARTICLE VI
INSOLVENCY OR LIQUIDATION PROCEEDINGS
     SECTION 6.1. Financing and Sale Issues. If any Borrower or any Guarantor
shall be subject to any Insolvency or Liquidation Proceeding and at any time
prior to the Discharge of First Lien Obligations the First Lien Agent or the
First Lien Lenders shall desire to permit (or not object to) the sale, use or
lease of cash collateral or to permit (or not object to) any Borrower to obtain
financing under Section 363 or Section 364 of the Bankruptcy Code or to provide
such financing (“DIP Financing”), then, so long as the maximum amount of
Indebtedness that may be incurred in connection with such DIP Financing shall
not exceed an amount equal to the Maximum First Lien Principal Debt Amount, then
the Second Lien Agent, on behalf of itself and the Second Lien Lenders, and each
Second Lien Lender by becoming a Second Lien Lender, agrees that it will raise
no objection to, nor support any other Person objecting to, such sale, use, or
lease of cash collateral or DIP Financing and will not request any form of
adequate protection or any other relief in connection therewith (except as
agreed by the First Lien Agent or to the extent expressly permitted by
Section 6.3) and, to the extent the Liens securing the First Lien Obligations
are subordinate to or pari passu with such DIP Financing, it (x) will
subordinate (and will be deemed hereunder to have subordinated) the Liens
securing the Second Lien Obligations (x) to such DIP Financing with, if
applicable, the same terms and
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conditions as the Liens securing the First Lien Obligations are subordinated
thereto (and such subordination will not alter in any manner the terms of this
Agreement), (y) to any adequate protection provided to the First Lien Agent and
the First Lien Lenders and (z) to any “carve-out” for professionals and United
States Trustee fees agreed to by the First Lien Agent or the First Lien Lenders,
and (ii) agrees that notice received four (4) calendar days prior to the entry
of an order approving such usage of cash collateral or approving such financing
shall be adequate notice. The Second Lien Agent, on behalf of itself and the
Second Lien Lenders, agrees that it will raise no objection to or oppose a sale
or other disposition of any Common Collateral free and clear of its Liens or
other claims under Section 363 of the Bankruptcy Code (or otherwise) if the
First Lien Required Lenders have consented to (or supported) such sale or
disposition of such assets so long as the respective interests of the Second
Lien Lenders attach to the proceeds thereof, subject to the terms of this
Agreement.
     SECTION 6.2. Relief from the Automatic Stay. Until the date upon which the
Discharge of First Lien Obligations shall have occurred, the Second Lien Agent,
on behalf of itself and the Second Lien Lenders, agrees that none of them shall
seek relief from the automatic stay or any other stay in any Insolvency or
Liquidation Proceeding in respect of any Common Collateral, without the prior
written consent of the First Lien Agent and the First Lien Required Lenders.
     SECTION 6.3. Adequate Protection. The Second Lien Agent, on behalf of
itself and the Second Lien Lenders, agrees that none of them shall object,
contest, or support any other Person objecting to or contesting, (i) any request
by the First Lien Agent or the First Lien Lenders for adequate protection or
(ii) any objection by the First Lien Agent or any First Lien Lender to any
motion, relief, action or proceeding based on a claim of a lack of adequate
protection or (iii) the payment of interest, fees, expenses or other amounts to
the First Lien Agent or any First Lien Lender under Section 506(b) or 506(c) of
the Bankruptcy Code or otherwise. Notwithstanding anything contained in this
Section and in Section 6.1, in any Insolvency or Liquidation Proceeding, (x) the
Second Lien Agent and the Second Lien Lenders, may seek, support, accept or
retain adequate protection (A) only if the First Lien Agent and the First Lien
Lenders are granted adequate protection that includes replacement liens on
additional collateral and superpriority claims and the First Lien Agent and the
First Lien Lenders do not object to the adequate protection being provided to
the First Lien Agent and the First Lien Lenders and (B) in the form of (1) a
replacement Lien on such additional collateral, subordinated to the Liens
securing the First Lien Obligations and such DIP Financing on the same basis as
the other Liens securing the Second Lien Obligations are so subordinated to the
First Lien Obligations under this Agreement and (y) superpriority claims junior
in all respects to the superpriority claims granted to the First Lien Agent and
the First Lien Lenders, and (2) in the event the Second Lien Agent, on behalf of
itself and the Second Lien Lenders, receives adequate protection, including in
the form of additional collateral, then the Second Lien Agent, on behalf of
itself or any of the Second Lien Lenders, agrees that the First Lien Agent shall
have a senior Lien and claim on such adequate protection as security for the
First Lien Obligations and that any Lien on any additional collateral securing
the Second Lien Obligations shall be subordinated to the Liens on such
collateral securing the First Lien Obligations and any DIP Financing (and all
Obligations relating thereto) and any other Liens granted to the First Lien
Agent and the First Lien Lenders as adequate protection, with such subordination
to be on the same terms that the other Liens securing the Second Lien
Obligations are subordinated to such First Lien Obligations
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under this Agreement. Notwithstanding the foregoing, if the First Lien Lenders
are deemed by a court of competent jurisdiction to be fully secured on the
petition date, then the Second Lien Lenders shall not be prohibited from seeking
adequate protection in the form of interest, fees or other cash payments.
     SECTION 6.4. No Waiver. Nothing contained herein shall prohibit or in any
way limit the First Lien Agent or any First Lien Lender from objecting in any
Insolvency or Liquidation Proceeding or otherwise to any action taken by the
Second Lien Agent or any of the Second Lien Lenders, including, without
limitation, the seeking by the Second Lien Agent or any Second Lien Lender of
adequate protection or the asserting by the Second Lien Agent or any Second Lien
Lender of any of its rights and remedies under the Second Lien Documents or
otherwise, unless, in each case, such action is consistent with the terms of
this Section 6.
     SECTION 6.5. Preference Issues. If the First Lien Agent or any First Lien
Lender is required in any Insolvency or Liquidation Proceeding or otherwise to
turn over or otherwise pay to the estate of the First Lien Borrower or any First
Lien Guarantor any amount (whether received by or on behalf of the First Lien
Borrower or any First Lien Guarantor, as proceeds of security, enforcement of
any right of setoff or otherwise) (a “Recovery”), then the obligation or part
thereof originally intended to be satisfied shall be reinstated and outstanding
as First Lien Obligations as if such payment had not occurred to the extent of
such Recovery and the Discharge of First Lien Obligations shall be deemed to not
have occurred. If this Agreement shall have been terminated prior to such
Recovery, this Agreement shall be reinstated in full force and effect, and such
prior termination shall not diminish, release, discharge, impair or otherwise
affect the obligations of the parties hereto from such date of reinstatement.
The Second Lien Agent and the Second Lien Lenders agree that none of them shall
be entitled to benefit from any avoidance action affecting or otherwise relating
to any distribution or allocation made in accordance with this Agreement,
whether by preference or otherwise, it being understood and agreed that the
benefit of such avoidance action otherwise allocable to them shall instead be
allocated and turned over for application in accordance with the priorities set
forth in this Agreement. In the event that any such payment with respect to the
First Lien Obligations results in a Discharge of First Lien Obligations, the
First Lien Agent and the First Lien Lenders agree that the Second Lien Agent and
the Second Lien Lenders shall be permitted to act hereunder as though a
Discharge of First Lien Obligations had occurred during the period from such
payment until the date of such reinstatement of the First Lien Obligations and
shall have no liability to the First Lien Agent or the First Lien Lenders for
any action taken or omitted to be taken hereunder in accordance therewith,
except to the extent such act or omission is found by a final, non-appealable
judgment of a court of competent jurisdiction to arise from the gross
negligence, bad faith or willful misconduct of the Second Lien Agent or Second
Lien Lenders.
     SECTION 6.6. Separate Grants of Security and Separate Classification. The
Second Lien Agent on behalf of itself and the Second Lien Lenders acknowledges
and agrees that (i) the grants of Liens pursuant to the First Lien Collateral
Documents and the Second Lien Collateral Documents constitute two separate and
distinct grants of Liens and (ii) because of, among other things, their
differing rights in the Common Collateral, the Second Lien Obligations are
fundamentally different from the First Lien Obligations and must be separately
classified in any plan of reorganization proposed or adopted in an Insolvency or
Liquidation Proceeding. To
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further effectuate the intent of the parties as provided in the immediately
preceding sentence, if it is held that the claims of the First Lien Agent and
the First Lien Lenders and the Second Lien Agent and the Second Lien Lenders in
respect of the Common Collateral constitute only one secured claim (rather than
separate classes of senior and junior secured claims), then the Second Lien
Agent on behalf of itself and the Second Lien Lenders hereby acknowledges and
agrees that all distributions shall be made as if there were separate classes of
senior and junior secured claims against the Borrowers and the Guarantors in
respect of the Common Collateral (with the effect being that, to the extent that
the aggregate value of the Common Collateral is sufficient (for this purpose
ignoring all claims held by the Second Lien Agent and the Second Lien Lenders),
the First Lien Agent and the First Lien Lenders shall be entitled to receive, in
addition to amounts distributed to them in respect of principal, pre-petition
interest and other claims, all amounts owing in respect of post-petition
interest before any distribution is made in respect of the claims held by the
Second Lien Agent and the Second Lien Lenders, with the Second Lien Agent and
the Second Lien Lenders hereby acknowledging and agreeing to turn over to the
First Lien Agent and the First Lien Lenders amounts otherwise received or
receivable by them to the extent necessary to effectuate the intent of this
sentence, even if such turnover has the effect of reducing the claim or recovery
of the Second Lien Agent and the Second Lien Lenders).
     SECTION 6.7. Other Matters. To the extent that the Second Lien Agent or any
Second Lien Lender has or acquires rights under Section 363 or Section 364 of
the Bankruptcy Code with respect to any of the Common Collateral, the Second
Lien Agent agrees, on behalf of itself and the Second Lien Lenders not to assert
any of such rights without the prior written consent of the First Lien Agent;
provided that if requested by the First Lien Agent, the Second Lien Agent shall
timely exercise such rights in the manner requested by the First Lien Agent,
including any rights to payments in respect of such rights.
     SECTION 6.8. Effectiveness in Insolvency or Liquidation Proceedings. This
Agreement, which the parties hereto expressly acknowledge is a “subordination
agreement” under Section 510(a) of the Bankruptcy Code, shall be effective
before, during and after the commencement of an Insolvency or Liquidation
Proceeding. All references in this Agreement to any Borrower or any Guarantor
shall include such Person as a debtor-in-possession and any receiver or trustee
for such Person in any Insolvency or Liquidation Proceeding.
ARTICLE VII
RELIANCE; WAIVERS; NOTICES; ETC
     SECTION 7.1. Reliance.
     (a) The consent by the First Lien Lenders to the execution and delivery of
the Second Lien Documents and the grant to the Second Lien Agent on behalf of
the Second Lien Lenders of a Lien on the Common Collateral and all loans and
other extensions of credit made or deemed made on and after the date hereof by
the First Lien Lenders to the First Lien Borrower shall be deemed to have been
given and made in reliance upon this Agreement. The Second Lien Agent, on behalf
of the Second Lien Lenders, acknowledges that the Second Lien Lenders have,
independently and without reliance on the First Lien Agent or any First Lien
Lender, and based on documents and information
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deemed by them appropriate, made their own credit analysis and decision to enter
into the Second Lien Financing Agreement, the other Second Lien Documents, this
Agreement and the transactions contemplated hereby and thereby and they will
continue to make their own credit decision in taking or not taking any action
under the Second Lien Financing Agreement, the other Second Lien Documents or
this Agreement.
     (b) The consent by the Second Lien Lenders to the execution and delivery of
the First Lien Documents and the grant to the First Lien Agent on behalf of the
First Lien Lenders of a Lien on the Common Collateral and all loans and other
extensions of credit made or deemed made on and after the date hereof by the
Second Lien Lenders to the Second Lien Borrower shall be deemed to have been
given and made in reliance upon this Agreement. The First Lien Agent, on behalf
of the First Lien Lenders, acknowledges that the First Lien Lenders have,
independently and without reliance on the Second Lien Agent or any Second Lien
Lender, and based on documents and information deemed by them appropriate, made
their own credit analysis and decision to enter into the First Lien Financing
Agreement, the other First Lien Documents, this Agreement and the transactions
contemplated hereby and thereby and they will continue to make their own credit
decision in taking or not taking any action under the First Lien Financing
Agreement, the other First Lien Documents or this Agreement.
     SECTION 7.2. No Warranties or Liability.
     (a) The Second Lien Agent, on behalf of itself and the Second Lien Lenders,
acknowledges and agrees that each of the First Lien Agent and the First Lien
Lenders has made no express or implied representation or warranty, including,
without limitation, with respect to the execution, validity, legality,
completeness, collectibility or enforceability of any of the First Lien
Documents. The First Lien Lenders will be entitled to manage and supervise their
respective loans and extensions of credit to the First Lien Borrower in
accordance with law and as they may otherwise, in their sole discretion, deem
appropriate, and the First Lien Lenders may manage their loans and extensions of
credit without regard to any rights or interests that the Second Lien Agent or
any of the Second Lien Lenders have in the Common Collateral or otherwise,
except as otherwise provided in this Agreement. Neither the First Lien Agent nor
any First Lien Lender shall have any duty to the Second Lien Agent or any of the
Second Lien Lenders to act or refrain from acting in a manner which allows, or
results in, the occurrence or continuance of an event of default or default
under any agreements with any Borrower or any Guarantor (including, without
limitation, the Second Lien Documents), regardless of any knowledge thereof
which they may have or be charged with.
     (b) The First Lien Agent, on behalf of itself and the First Lien Lenders,
acknowledges and agrees that each of the Second Lien Agent and the Second Lien
Lenders has made no express or implied representation or warranty, including,
without limitation, with respect to the execution, validity, legality,
completeness, collectibility or enforceability of any of the Second Lien
Documents. The Second Lien Lenders will be entitled to manage and supervise
their respective loans to the Second Lien
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Borrower in accordance with law and as they may otherwise, in their sole
discretion, deem appropriate, and the Second Lien Lenders may manage their loans
and extensions of credit without regard to any rights or interests that the
First Lien Agent or any of the First Lien Lenders have in the Common Collateral
or otherwise, except as otherwise provided in this Agreement. Neither the Second
Lien Agent nor any Second Lien Lender shall have any duty to the First Lien
Agent or any of the First Lien Lenders to act or refrain from acting in a manner
which allows, or results in, the occurrence or continuance of an event of
default or default under any agreements with any Borrower or any Guarantor
(including, without limitation, the First Lien Documents), regardless of any
knowledge thereof which they may have or be charged with.
     SECTION 7.3. No Waiver of Lien Priorities.
     (a) No right of the First Lien Lenders, the First Lien Agent or any of them
to enforce any provision of this Agreement shall at any time in any way be
prejudiced or impaired by any act or failure to act on the part of the First
Lien Borrower or the First Lien Guarantors or by any act or failure to act by
any First Lien Lender or the First Lien Agent, or by any noncompliance by any
Person with the terms, provisions and covenants of this Agreement, any of the
First Lien Documents or any of the Second Lien Documents, regardless of any
knowledge thereof which the First Lien Agent or the First Lien Lenders, or any
of them, may have or be otherwise charged with.
     (b) Without in any way limiting any other provision hereof, (but subject to
the rights of the First Lien Borrower and the First Lien Guarantors under the
First Lien Documents and the proviso set forth in the definition of the term
“First Lien Financing Agreement”), the First Lien Lenders, the First Lien Agent
and any of them, may, at any time and from time to time, without the consent of
the Second Lien Agent or any Second Lien Lender, without impairing or releasing
the lien priorities and other benefits provided in this Agreement (even if any
right of subrogation or other right or remedy of the Second Lien Agent or any
Second Lien Lender is affected, impaired or extinguished thereby) do any one or
more of the following:
     (i) make loans and advances to the First Lien Borrower or any First Lien
Guarantor or issue, guaranty or obtain letters of credit for the account of any
such Person or otherwise extend credit to any such Person, in any amount and on
any terms, whether pursuant to a commitment or as a discretionary advance and
whether or not any default or event of default or failure of condition is then
continuing;
     (ii) change the manner, place or terms of payment or change or extend the
time of payment of, or renew, exchange, amend, increase or alter, the terms of
any of the First Lien Obligations or any Lien on any First Lien Collateral or
guaranty thereof or any liability of the First Lien Borrower or any First Lien
Guarantor, or any liability incurred directly or indirectly in respect thereof
(including, without limitation, any increase in or extension of the First Lien
Obligations, without any restriction as to the amount, tenor or terms of any
such increase or extension) or otherwise amend; renew, exchange, extend, modify
or supplement in any manner any Liens held by the
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First Lien Lenders, the First Lien Obligations or any of the First Lien
Documents; provided, however, nothing herein shall prohibit the Second Lien
Agent and the Second Lien Lenders from enforcing any rights arising under the
Second Lien Financing Agreement as a result of Second Lien Borrower’s or any
Second Lien Guarantors’ violation of the terms thereof including any covenant
prohibiting the amendment of certain provisions of the First Lien Financing
Agreement, subject in each case to this Agreement;
     (iii) sell, exchange, release, surrender, realize upon, enforce or
otherwise deal with in any manner and in any order any part of the First Lien
Collateral or any liability of the First Lien Borrower or any First Lien
Guarantor to the First Lien Lenders or the First Lien Agent, or any liability
incurred directly or indirectly in respect thereof;
     (iv) settle or compromise any First Lien Obligation or any other liability
of the First Lien Borrower or any First Lien Guarantor or any security therefor
or any liability incurred directly or indirectly in respect thereof and apply
any sums by whomsoever paid and however realized to any liability (including,
without limitation, the First Lien Obligations) in any manner or order;
     (v) exercise or delay in or refrain from exercising any right or remedy
against the First Lien Borrower or any security or any First Lien Guarantor or
any other Person, elect any remedy and otherwise deal freely with the First Lien
Borrower, any First Lien Guarantor and the First Lien Collateral and any
security and any guarantor or any liability of the First Lien Borrower or any
First Lien Guarantor to the First Lien Lenders or any liability incurred
directly or indirectly in respect thereof;
     (vi) release or discharge any First Lien Obligations or any guaranty
thereof or any agreement or obligation of the First Lien Borrower or First Lien
Guarantor or any other Person or entity with respect thereto;
     (vii) take or fail to take any Lien on any First Lien Collateral or any
other collateral security for any First Lien Obligations or take or fail to take
any action which may be necessary or appropriate to ensure than any Lien on any
First Lien Collateral or any other Lien upon any property is duly enforceable or
perfected or entitled to priority as against any other Lien or to ensure that
any proceeds of any property subject to any Lien are applied to the payment of
any First Lien Obligations or any other obligation secured thereby; or
     (viii) otherwise release, discharge or permit the lapse of any or all First
Lien Obligations or any other Liens upon any property at any time securing any
First Lien Obligations.
     (c) The Second Lien Agent, on behalf of itself and the Second Lien Lenders,
also agrees that the First Lien Lenders and the First Lien Agent shall have no
liability to the Second Lien Agent or any Second Lien Lender, and the Second
Lien Agent, on behalf of itself and the Second Lien Lenders, hereby waives any
claim against any First Lien Lender or the First Lien Agent, arising out of any
and all actions which the
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First Lien Lenders or the First Lien Agent may take or permit or omit to take
with respect to: (i) the First Lien Documents, (ii) the collection of the First
Lien Obligations or (iii) the perfection, release, failure to act upon,
foreclosure upon, or sale, liquidation or other disposition of, the First Lien
Collateral; provided that notwithstanding the foregoing, the First Lien Agent
shall be liable for damages resulting from actions taken by it in violation of
any provision of this Agreement to the extent such violation is found by a
final, non-appealable judgment of a court of competent jurisdiction to arise
from its gross negligence, bad faith or willful misconduct. The Second Lien
Agent, on behalf of itself and the Second Lien Lenders, agrees that the First
Lien Lenders and the First Lien Agent have no duty to them in respect of the
maintenance or preservation of the First Lien Collateral or the First Lien
Obligations.
     (d) The Second Lien Agent, on behalf of itself and the Second Lien Lenders,
agrees not to assert and hereby waives, to the fullest extent permitted by law,
any right to demand, request, plead or otherwise assert or otherwise claim the
benefit of, any marshalling, appraisal, valuation or other similar right that
may otherwise be available under applicable law or any other similar rights a
junior secured creditor may have under applicable law.
     SECTION 7.4. Obligations Unconditional. All rights, interests, agreements
and obligations of the First Lien Agent and the First Lien Lenders and the
Second Lien Agent and the Second Lien Lenders, respectively, hereunder shall
remain in full force and effect as set forth herein irrespective of:
     (a) any lack of validity or enforceability of the First Lien Documents or
any Second Lien Documents;
     (b) any change in the time, manner or place of payment of, or in any other
terms of, all or any of the First Lien Obligations or Second Lien Obligations,
or any amendment or waiver or other modification, including, without limitation,
any increase in the amount thereof, whether by course of conduct or otherwise,
of the terms of the First Lien Financing Agreement or any other First Lien
Document or of the terms of the Second Lien Financing Agreement or any other
Second Lien Document;
     (c) any compromise, surrender, release, non-perfection or exchange of any
security interest in any Common Collateral or any other collateral, or any
amendment, waiver or other modification, whether in writing or by course of
conduct or otherwise, of all or any of the First Lien Obligations or Second Lien
Obligations or any guarantee thereof;
     (d) the commencement of any Insolvency or Liquidation Proceeding in respect
of any Borrower or any Guarantor; or
     (e) any other circumstances which otherwise might constitute a defense
available to, or a discharge of, any Borrower or any Guarantor in respect of the
First Lien Obligations or of the Second Lien Agent or any Second Lien Lender or
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Second Lien Obligations in respect of this Agreement other than a defense of
performance in full, or payment in full in cash, of the First Lien Obligations.
     SECTION 7.5. Certain Notices.
     (a) Promptly upon the satisfaction of the conditions set forth in clauses
(i), (ii), (iii), and (iv) of the definition of Discharge of First Lien
Obligations, the First Lien Agent shall deliver the notice contemplated by
clause (v) of said definition.
     (b) Promptly upon (or as soon as practicable following) the commencement by
the First Lien Agent of any enforcement action with respect to any Common
Collateral (including by way of a public or private sale of Collateral), the
First Lien Agent shall notify the Second Lien Agent of such action; provided
that the failure to give any such notice shall not result in any liability of
the First Lien Agent hereunder or in the modification, alteration, impairment,
or waiver of the rights of any party hereunder.
ARTICLE VIII
MISCELLANEOUS
     SECTION 8.1. Conflicts. In the event of any conflict between the provisions
of this Agreement and the provisions of the First Lien Documents or the Second
Lien Documents regarding solely the relative rights and obligations between the
First Lien Agent and the First Lien Lenders on the one hand and the Second Lien
Agent and the Second Lien Lenders on the other, respectively, the provisions of
this Agreement shall govern.
     SECTION 8.2. Waiver of Consequential Damages. No party shall be liable for
any special, indirect, consequential or punitive damages in connection with this
Agreement regardless of whether such damages were contemplated and regardless of
the form of action.
     SECTION 8.3. Continuing Nature of this Agreement. This Agreement shall
continue to be effective notwithstanding the Discharge of the First Lien
Obligations. This is a continuing agreement of lien priorities and the First
Lien Lenders may continue, at any time and without notice to the Second Lien
Agent or any Second Lien Lender, to extend credit and other financial
accommodations and lend monies to or for the benefit of the First Lien Borrower
and First Lien Guarantors constituting First Lien Obligations on the faith
hereof. The Second Lien Agent, on behalf of itself and the Second Lien Lenders,
hereby waives any right it may have under applicable law to revoke this
Agreement or any of the provisions of this Agreement. The terms of this
Agreement shall survive, and shall continue in full force and effect, in any
Insolvency or Liquidation Proceeding.
     SECTION 8.4. Amendments; Waivers. No amendment to or waiver of any
provision of this Agreement, nor consent to any departure by any Person from its
obligations under this Agreement, shall in any event be effective unless the
same shall be in writing and signed by the First Lien Agent and the Second Lien
Agent, each acting upon the direction of the First Lien Lenders or Second Lien
Lenders as set forth in the applicable Credit Agreement. Each waiver, if any,
shall be a waiver only with respect to the specific instance involved and shall
in no way impair the rights of the parties making such waiver or the obligations
of the other parties to such
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party in any other respect or at any other time. Neither any Borrower nor any
Guarantor shall have any right to amend, modify or waive any provision of this
Agreement without the consent of the Second Lien Agent then party hereto or the
First Lien Agent then party hereto, as applicable, nor shall any consent or
signed writing be required of any of them to effect any amendment, modification
or waiver of any provision of this Agreement, except that no amendment,
modification or waiver affecting any obligation or right of any Borrower or any
Guarantor hereunder shall be made without the written consent of the applicable
Borrower. The First Lien Agent shall give prompt notice to the First Lien
Borrower of each amendment, modification or waiver hereunder that does not
require the consent of the First Lien Borrower, but the failure to give such
notice shall not affect the validity of each such amendment, modification or
waiver.
     SECTION 8.5. Information Concerning Financial Condition of the Borrowers,
Guarantors and their Subsidiaries.
     (a) The First Lien Lenders, on the one hand, and the Second Lien Lenders,
on the other hand, shall each be responsible for keeping themselves informed of
(i) the financial condition of the Borrowers, Guarantors and their Subsidiaries
and all endorsers and/or guarantors of the Second Lien Obligations or the First
Lien Obligations and (ii) all other circumstances bearing upon the risk of
nonpayment of the Second Lien Obligations or the First Lien Obligations. The
First Lien Agent and the First Lien Lenders shall have no duty to advise the
Second Lien Agent or any Second Lien Lender of information known to it or them
regarding such condition or any such circumstances or otherwise. In the event
the First Lien Agent or any of the First Lien Lenders, in its or their sole
discretion, undertakes at any time or from time to time to provide any such
information to the Second Lien Agent or any Second Lien Lender, it or they shall
be under no obligation (x) to provide any additional information or to provide
any such information on any subsequent occasion, (y) to undertake any
investigation or (z) to disclose any information which, pursuant to accepted or
reasonable commercial finance practices, such party wishes to maintain
confidential.
     (b) The Second Lien Agent and the Second Lien Lenders shall have no duty to
advise the First Lien Agent or any First Lien Lender of information known to it
or them regarding such condition or any such circumstances or otherwise. In the
event the Second Lien Agent or any of the Second Lien Lenders, in its or their
sole discretion, undertakes at any time or from time to time to provide any such
information to the First Lien Agent or any First Lien Lender, it or they shall
be under no obligation (i) to provide any additional information or to provide
any such information on any subsequent occasion, (ii) to undertake any
investigation or (iii) to disclose any information which, pursuant to accepted
or reasonable commercial finance practices, such party wishes to maintain
confidential.
     SECTION 8.6. Subrogation. The Second Lien Agent, on behalf of itself and
the Second Lien Lenders, hereby waives any rights of subrogation it may acquire
as a result of any payment hereunder until the date upon which the Discharge of
First Lien Obligations shall have occurred.
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     SECTION 8.7. Application of Payments. As between the First Lien Lenders and
the Second Lien Lenders, all payments received by the First Lien Lenders may be
applied, reversed and reapplied, in whole or in part, to such part of the First
Lien Obligations as the First Lien Lenders, in their sole discretion, deem
appropriate.
     SECTION 8.8. Consent to Jurisdiction; Waivers.
     (a) ANY LITIGATION BASED HEREON, OR ARISING OUT OF, UNDER, OR IN CONNECTION
WITH, THIS AGREEMENT, OR ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS
(WHETHER ORAL OR WRITTEN) OR ACTIONS OF THE PARTIES HERETO IN CONNECTION
HEREWITH MAY BE BROUGHT AND MAINTAINED IN THE COURTS OF THE STATE OF NEW YORK OR
IN THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK. EACH
PARTY HERETO IRREVOCABLY CONSENTS TO THE SERVICE OF PROCESS BY REGISTERED MAIL,
POSTAGE PREPAID, OR BY PERSONAL SERVICE WITHIN OR WITHOUT THE STATE OF NEW YORK
AT THE ADDRESS FOR NOTICES SPECIFIED IN SECTION 8.9. EACH PARTY HEREBY EXPRESSLY
AND IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, ANY OBJECTION
WHICH IT MAY HAVE OR HEREAFTER MAY HAVE TO THE LAYING OF VENUE OF ANY SUCH
LITIGATION BROUGHT IN ANY SUCH COURT REFERRED TO ABOVE AND ANY CLAIM THAT ANY
SUCH LITIGATION HAS BEEN BROUGHT IN AN INCONVENIENT FORUM. TO THE EXTENT THAT
ANY PARTY HERETO HAS OR HEREAFTER MAY ACQUIRE ANY IMMUNITY FROM JURISDICTION OF
ANY COURT OR FROM ANY LEGAL PROCESS (WHETHER THROUGH SERVICE OR NOTICE,
ATTACHMENT PRIOR TO JUDGMENT, ATTACHMENT IN AID OF EXECUTION OR OTHERWISE) WITH
RESPECT TO ITSELF OR ITS PROPERTY, SUCH PARTY HEREBY IRREVOCABLY WAIVES TO THE
FULLEST EXTENT PERMITTED BY LAW SUCH IMMUNITY IN RESPECT OF ITS OBLIGATIONS
UNDER THIS AGREEMENT.
     (b) EACH PARTY HERETO HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY
WAIVES TO THE FULLEST EXTENT PERMITTED BY LAW ANY RIGHTS IT MAY HAVE TO A TRIAL
BY JURY IN RESPECT OF ANY LITIGATION BASED HEREON, OR ARISING OUT OF, UNDER, OR
IN CONNECTION WITH, THIS AGREEMENT, OR ANY COURSE OF CONDUCT, COURSE OF DEALING,
STATEMENTS (WHETHER ORAL OR WRITTEN) OR ACTIONS OF ANY PARTY HERETO IN
CONNECTION HEREWITH. EACH PARTY HERETO ACKNOWLEDGES AND AGREES THAT IT HAS
RECEIVED FULL AND SUFFICIENT CONSIDERATION FOR THIS PROVISION AND THAT THIS
PROVISION IS A MATERIAL INDUCEMENT FOR THE OTHER PARTIES HERETO ENTERING INTO
THIS AGREEMENT.
     SECTION 8.9. Notices; Time. All notices and other communications provided
under this Agreement shall be in writing or by facsimile and addressed,
delivered or transmitted, if to the Borrowers, the First Lien Agent, the Second
Lien Agent or the Control Agent at its address or facsimile number set forth on
Schedule I hereto or at such other address or facsimile number
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as may be designated by such party in a notice to the other parties. Any notice,
if mailed and properly addressed with postage prepaid or if properly addressed
and sent by pre-paid courier service, shall be deemed given when received. Any
notice, if transmitted by facsimile, shall be deemed given when the confirmation
of transmission thereof is received by the transmitter. Except as set forth
below, electronic mail and Internet and intranet websites may be used only to
distribute routine communications among the parties and for the distribution and
execution of documentation for execution by the parties thereto, and may not be
used for any other purpose. Notwithstanding the foregoing, the parties hereto
agree that delivery of an executed counterpart of a signature page to this
Agreement by facsimile (or other electronic) transmission shall be effective as
delivery of an original executed counterpart of this Agreement. Unless otherwise
indicated, all references herein to the time of a day shall refer to New York
time.
     SECTION 8.10. Further Assurances. The Second Lien Agent, on behalf of
itself and the Second Lien Lenders, agrees that each of them shall take such
further action and shall execute and deliver to the First Lien Agent and the
First Lien Lenders such additional documents and instruments (in recordable
form, if requested) as the First Lien Agent or the First Lien Lenders may
reasonably determine to be required or appropriate to effectuate the terms of
and the lien priorities contemplated by this Agreement; provided that any
reasonable and documented out-of-pocket costs and expenses incurred by the
Second Lien Agent in connection therewith shall be reimbursable by the Second
Lien Borrower or the Second Lien Guarantors to the extent provided under the
Second Lien Documents.
     SECTION 8.11. Governing Law. THIS AGREEMENT WILL BE DEEMED TO BE A CONTRACT
MADE UNDER AND GOVERNED BY THE INTERNAL LAWS OF THE STATE OF NEW YORK (INCLUDING
FOR SUCH PURPOSE SECTIONS 5-1401 AND 5-1402 OF THE GENERAL OBLIGATIONS LAW OF
THE STATE OF NEW YORK).
     SECTION 8.12. Binding on Successors and Assigns.
     (a) This Agreement shall be binding upon the First Lien Agent, the First
Lien Lenders, the Second Lien Agent, the Second Lien Lenders and their
respective permitted successors and assigns.
     (b) Upon a Person becoming the First Lien Agent as described in the
definition of “First Lien Agent” hereunder (other than the First Lien Agent
referred to in the recitals hereto), such new First Lien Agent shall
automatically become the First Lien Agent hereunder with all the rights and
powers of such party hereunder, and bound by the provisions hereof, without the
need for any further action on the part of any party hereto.
     (c) Upon a successor administrative agent, collateral agent or trustee
becoming the Second Lien Agent under the Second Lien Financing Agreement or any
Second Lien Document, such successor automatically shall become the Second Lien
Agent hereunder with all the rights and powers of the Second Lien Agent
hereunder, and bound by the provisions hereof, without the need for any further
action on the part of any party hereto.
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     SECTION 8.13. Specific Performance. The First Lien Agent may demand
specific performance of this Agreement. The Second Lien Agent, on behalf of
itself and the Second Lien Lenders hereby irrevocably waives any defense based
on the adequacy of a remedy at law and any other defense which might be asserted
to bar the remedy of specific performance in any action which may be brought by
the First Lien Agent.
     SECTION 8.14. Section Titles; Time Periods. The various headings contained
in this Agreement are inserted for convenience only and shall not affect the
meaning or interpretation of this Agreement or any provisions hereof. In the
computation of time periods, unless otherwise specified, the word “from” means
“from and including” and each of the words “to” and “until” means “to but
excluding” and the word “through” means “to and including”.
     SECTION 8.15. Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be an original and all of which shall together
constitute one and the same document.
     SECTION 8.16. Authorization. By its signature, each Person executing this
Agreement on behalf of a party hereto represents and warrants to the other
parties hereto that it is duly authorized to execute this Agreement.
     SECTION 8.17. No Third Party Beneficiaries. This Agreement and the rights
and benefits hereof shall inure to the benefit of the First Lien Agent and the
First Lien Lenders and their respective successors (including as a result of a
refinancing) and assigns and, to the extent applicable, the Borrowers, the
Guarantors, the Second Lien Agent and the Second Lien Lenders and their
respective permitted successors (including as a result of a refinancing) and
assigns. No other Person, shall have or be entitled to assert rights or benefits
hereunder.
     SECTION 8.18. Effectiveness. This Agreement shall become effective when
executed and delivered by the parties hereto. This Agreement shall be effective
both before and after the commencement of any Insolvency or Liquidation
Proceeding. All references to any Borrower or any Guarantor shall include such
Borrower or such Guarantor as debtor and debtor-in-possession and any receiver
or trustee for such Borrower or such Guarantor (as the case may be) in any
Insolvency or Liquidation Proceeding.
     SECTION 8.19. Rights of Agents. (a) The rights, protections, privileges and
immunities, without duplication, including rights of indemnification,
compensation and reimbursement, of the First Lien Agent, the Second Lien Agent
and the Control Agent, shall be the same as those applicable to the First Lien
Agent under the Pledge and Security Agreement, dated as of September 5, 2006,
among the First Lien Borrower, the Guarantors named therein and the First Lien
Agent, and such provisions are hereby incorporated herein as if specifically set
forth herein.
     (b) The parties hereto agree that whenever this Agreement requires or
otherwise makes reference to the consent, discretion, agreement, approval,
judgment, or any other similar term contemplating an act, or omission to act, by
the First Lien Agent, the Second Lien Agent or the Control Agent, such Agents
will only so act, or omit to act, upon the specific written direction of the
First Lien Required Lenders, the First Lien Administrative Agent, the Second
Lien Required
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Lenders or the Second Lien Administrative, as the case may be, and in the
absence of such direction, such Agents shall have no liability whatsoever for
their failure to act.
     (c) The provisions of this Section 8.19 shall survive the termination of
this Agreement.
(Signature Pages Follow)
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     IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the date first written above.

            CITIBANK, N.A., as First Lien Agent

388 Greenwich Street
14th Floor
New York, New York 10013
Attn: Agency & Trust
Fax: (212) 657-2762
      By:           Name:           Title:        

            CITIBANK, N.A., as Second Lien Agent

388 Greenwich Street
14th Floor
New York, New York 10013
Attn: Agency & Trust
Fax: (212) 657-2762
      By:           Name:           Title:        

            CITIBANK, N.A., as Control Agent

388 Greenwich Street
14th Floor
New York, New York 10013
Attn: Agency & Trust
Fax: (212) 657-2762
      By:           Name:           Title:        

 

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            HANESBRANDS INC., as the First Lien Borrower
and a Second Lien Guarantor
      By:           Name:           Title:        

            HBI BRANDED APPAREL LIMITED, INC., as the
Second Lien Borrower and a First Lien Guarantor
      By:           Name:           Title:        

            Guarantors:

HANESBRANDS DIRECT, LLC
      By:           Name:           Title:        

            UPEL, INC.
      By:           Name:           Title:        

            CARIBETEX, INC.
      By:           Name:           Title:        

 

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            SEAMLESS TEXTILES, LLC
      By:           Name:           Title:        

            BA INTERNATIONAL, L.L.C.
      By:           Name:           Title:        

            HBI INTERNATIONAL, LLC
      By:           Name:           Title:        

            HBI BRANDED APPAREL ENTERPRISES, LLC
      By:           Name:           Title:        

            CASA INTERNATIONAL, LLC
      By:           Name:           Title:        

            UPCR, INC.
      By:           Name:           Title:        

 

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            HBI SOURCING, LLC
      By:           Name:           Title:        

            HBI PLAYTEX BATH LLC
      By:           Name:           Title:        

            CEIBENA DEL, INC.
      By:           Name:           Title:        

            NT INVESTMENT COMPANY, INC.
      By:           Name:           Title:        

            HANESBRANDS DISTRIBUTION, INC.
      By:           Name:           Title:        

            CARIBESOCK, INC.
      By:           Name:           Title:        

 

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            NATIONAL TEXTILES, L.L.C
      By:           Name:           Title:        

            HANES PUERTO RICO, INC.
      By:           Name:           Title:        

            PLAYTEX INDUSTRIES, INC.
      By:           Name:           Title:        

            INNER SELF LLC
      By:           Name:           Title:        

            PLAYTEX DORADO, LLC
      By:           Name:           Title:        

            HANES MENSWEAR, LLC
      By:           Name:           Title:        

 

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SCHEDULE I
Notice Information (Pursuant to Section 8.9)
NOTICE ADDRESS FOR THE BORROWERS:
Hanesbrands Inc./ HBI Branded Apparel Limited, Inc.
1000 East Hanes Mill Rd
Winston Salem, NC 27105
Attn: General Counsel
NOTICE ADDRESS FOR ADMINISTRATIVE AGENT:
Citicorp USA, Inc.
2 Penns Way
Suite 100
New Castle, De 19720
Attention: Carin Seals
Fax: (302) 894-6076
Phone: (212) 994-0967
E-mail: carin.seals@citigroup.com
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EXHIBIT I
CLOSING DATE CERTIFICATE
HANESBRANDS INC.
September 5, 2006
     This certificate is delivered pursuant to Section 5.1.2 of the First Lien
Credit Agreement, dated as of September 5, 2006 (the “Credit Agreement”), among
Hanesbrands Inc. (the “Borrower”), the Lenders, HSBC Bank USA, National
Association, LaSalle Bank National Association and Barclays Bank PLC, as the
Co-Documentation Agents, Merrill Lynch, Pierce, Fenner & Smith Incorporated and
Morgan Stanley Senior Funding, Inc., as the Co-Syndication Agents, Citicorp USA,
Inc., as the Administrative Agent, Citibank, N.A., as the Collateral Agent, and
Merrill Lynch, Pierce, Fenner & Smith Incorporated and Morgan Stanley Senior
Funding, Inc., as the joint lead arrangers and joint bookrunners (in such
capacities, the “Lead Arrangers”). Capitalized terms used herein that are
defined in the Credit Agreement, unless otherwise defined herein, have the
meanings provided (or incorporated by reference) in the Credit Agreement.
     The undersigned Authorized Officer, solely in such capacity and not as an
individual, hereby certifies, represents and warrants that, as of the Closing
Date:
     1. Consummation of Transactions. (a) All actions necessary to consummate
the Transaction (other than the entering into of the Senior Note Documents and
the issuance of the Senior Notes) have been taken in accordance in all material
respects with all applicable law and in accordance with the terms of each
applicable Transaction Document, without amendment or waiver of any material
provision thereof, unless approved by the Lead Arrangers in their reasonable
discretion.
     (b) Attached hereto as Annex I are true and correct copies of the material
Second Lien Loan Documents which are in full force and effect and pursuant to
which HBI Branded Apparel Limited, Inc. will borrow $450,000,000 in loans
thereunder on the Closing Date.
     (c) Attached hereto as Annex II are true and correct copies of the material
Bridge Loan Documents which are in full force and effect and pursuant to which
the Borrower will borrow $500,000,000 in loans thereunder on the Closing Date.
     2. Litigation, etc. There exists no action, suit, investigation, litigation
or proceeding pending or threatened in writing in any court or before any
arbitrator or governmental or regulatory agency or authority that could
reasonably be expected to have a Material Adverse Effect.
     3. Approval. All material and necessary governmental and third party
consents and approvals have been obtained (without the imposition of any
material and adverse conditions that are not reasonably acceptable to the
Lenders) and remain in effect and all applicable waiting periods have expired
without any material and adverse action being taken by any competent authority.
Closing Date Certificate (First Lien)

 

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     4. Debt Ratings. The Borrower has obtained a senior secured debt rating (of
any level) in respect of the Loans from each of S&P and Moody’s and such ratings
(of any level) are in effect as of the date hereof.
     5. Form 10. The financial information concerning the Branded Apparel
Business and the Borrower and its Subsidiaries contained in the Borrower’s
Form 10 filed with the Securities and Exchange Commission in connection with the
Spin-Off, including all amendments and modifications thereto, is consistent in
all material respects with the information previously provided to the Lead
Arrangers and the Lenders.

  6.   Compliance with Warranties, No Default, etc. The following statements are
true and correct as of the date hereof (after giving effect to the making of the
initial Credit Extension):

     (a) the representations and warranties set forth in each Loan Document are,
in each case, true and correct in all material respects (unless stated to relate
solely to an earlier date, in which case such representations and warranties
were true and correct in all material respects as of such earlier date); and
     (b) no Default has occurred and is continuing.
Closing Date Certificate (First Lien)

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     IN WITNESS WHEREOF, the undersigned has caused this Closing Date
Certificate to be executed and delivered, and the certification, representations
and warranties contained herein, by its Authorized Officer, are made solely in
such capacity and not as an individual, as of the date first written above.

            HANESBRANDS INC.
      By:           Name:           Title:        

Closing Date Certificate (First Lien)

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Annex I
Material Second Lien Loan Documents
Closing Date Certificate (First Lien)

 

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Annex II
Material Bridge Loan Documents
Closing Date Certificate (First Lien)