Exhibit 10.1

 

EXECUTION VERSION

 

CREDIT AGREEMENT

 

dated as of June 24, 2016,

 

among

 

TESSCO TECHNOLOGIES INCORPORATED,

as Parent,

 

TESSCO INCORPORATED, GW SERVICE SOLUTIONS, INC.,

TESSCO SERVICE SOLUTIONS, INC., and

TCPM, INC.

as Borrowers,

 

THE LENDERS FROM TIME TO TIME PARTY HERETO,

 

and

 

SUNTRUST BANK

as Administrative Agent

 

 

 

SUNTRUST ROBINSON HUMPHREY, INC.

as Sole Lead Arranger and Sole Book Manager

 

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TABLE OF CONTENTS

 

 

 

 

Page

 

 

 

ARTICLE I

DEFINITIONS; CONSTRUCTION

 

1

Section 1.1.

Definitions

 

1

Section 1.2.

[Reserved.]

 

37

Section 1.3.

Accounting Terms and Determination

 

37

Section 1.4.

Terms Generally

 

38

 

 

 

 

ARTICLE II

AMOUNT AND TERMS OF THE COMMITMENTS

 

38

Section 2.1.

General Description of Facilities

 

38

Section 2.2.

Revolving Loans

 

39

Section 2.3.

Procedure for Revolving Borrowings

 

39

Section 2.4.

Swingline Commitment

 

39

Section 2.5.

Overadvances; Optional Overadvances

 

42

Section 2.6.

Agent Advances

 

42

Section 2.7.

Reserved

 

43

Section 2.8.

Funding of Borrowings

 

43

Section 2.9.

[Reserved.]

 

44

Section 2.10.

Optional Reduction and Termination of Commitments

 

44

Section 2.11.

Repayment of Loans

 

45

Section 2.12.

Evidence of Indebtedness

 

45

Section 2.13.

Optional Prepayments

 

46

Section 2.14.

Mandatory Prepayments

 

46

Section 2.15.

Interest on Loans

 

47

Section 2.16.

Fees

 

48

Section 2.17.

Computation of Interest and Fees

 

49

Section 2.18.

Inability to Determine Interest Rates

 

49

Section 2.19.

Illegality

 

49

Section 2.20.

Increased Costs

 

50

Section 2.21

[Reserved.]

 

51

Section 2.22.

Taxes

 

51

Section 2.23.

Payments Generally; Pro Rata Treatment; Sharing of Set-offs

 

55

Section 2.24.

Letters of Credit

 

57

Section 2.25.

Increase of Commitments; Additional Lenders

 

62

Section 2.26.

Mitigation of Obligations

 

64

Section 2.27.

Replacement of Lenders

 

65

Section 2.28.

Defaulting Lenders and Potential Defaulting Lenders

 

65

Section 2.29.

Acknowledgement and Consent to Bail-In of EEA Financial Institutions

 

69

Section 2.30.

Multiple Borrower Provisions

 

69

 

 

 

 

ARTICLE III

CONDITIONS PRECEDENT TO LOANS AND LETTERS OF CREDIT

 

71

Section 3.1.

Conditions to Effectiveness

 

71

Section 3.2.

Conditions to Each Credit Event

 

74

Section 3.3.

Delivery of Documents

 

75

 

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ARTICLE IV

REPRESENTATIONS AND WARRANTIES

 

75

Section 4.1.

Existence; Power

 

75

Section 4.2.

Organizational Power; Authorization

 

75

Section 4.3.

Governmental Approvals; No Conflicts

 

75

Section 4.4.

Financial Statements

 

76

Section 4.5.

Litigation and Environmental Matters

 

76

Section 4.6.

Compliance with Laws and Agreements

 

76

Section 4.7.

Investment Company Act

 

76

Section 4.8.

Taxes

 

77

Section 4.9.

Margin Regulations

 

77

Section 4.10.

ERISA

 

77

Section 4.11.

Ownership of Property; Insurance

 

78

Section 4.12.

Disclosure

 

79

Section 4.13.

Labor Relations

 

79

Section 4.14.

Subsidiaries

 

79

Section 4.15.

Solvency

 

79

Section 4.16.

Deposit Accounts

 

79

Section 4.17.

Collateral Documents

 

79

Section 4.18.

[Reserved.]

 

80

Section 4.19.

Material Agreements

 

80

Section 4.20.

Anti-Corruption Laws and Sanctions

 

80

Section 4.21.

Representations and Warranties Relating to Accounts

 

80

Section 4.22.

Representations and Warranties Relating to National Air Time

 

80

 

 

 

 

ARTICLE V

AFFIRMATIVE COVENANTS

 

81

Section 5.1.

Financial Statements and Other Information

 

81

Section 5.2.

Notices of Material Events

 

83

Section 5.3.

Existence; Conduct of Business

 

84

Section 5.4.

Compliance with Laws

 

85

Section 5.5.

Payment of Obligations

 

85

Section 5.6.

Books and Records

 

85

Section 5.7.

Visitation and Inspection

 

85

Section 5.8.

Maintenance of Properties; Insurance

 

85

Section 5.9.

Use of Proceeds; Margin Regulations

 

86

Section 5.10.

Casualty and Condemnation

 

86

Section 5.11.

Cash Management

 

86

Section 5.12.

Additional Subsidiaries and Collateral

 

88

Section 5.13.

Additional Real Estate; Leased Locations

 

89

Section 5.14.

Further Assurances

 

89

 

 

 

 

ARTICLE VI

FINANCIAL COVENANT

 

90

Section 6.3.

Fixed Charge Coverage Ratio

 

90

 

 

 

 

ARTICLE VII

NEGATIVE COVENANTS

 

90

Section 7.1.

Indebtedness and Preferred Equity

 

90

Section 7.2.

Liens

 

91

Section 7.3.

Fundamental Changes

 

92

 

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Section 7.4.

Investments, Loans

 

93

Section 7.5.

Restricted Payments

 

94

Section 7.6.

Disposition of Assets

 

94

Section 7.7.

Transactions with Affiliates

 

95

Section 7.8.

Restrictive Agreements

 

95

Section 7.9.

[Reserved.]

 

96

Section 7.10.

Hedging Transactions

 

96

Section 7.11.

Amendment to Material Documents

 

96

Section 7.12.

Prepayments and Amendments

 

96

Section 7.13.

Accounting Changes

 

97

Section 7.14.

[Reserved]

 

97

Section 7.15.

Government Regulation

 

97

 

 

 

 

ARTICLE VIII

EVENTS OF DEFAULT

 

98

Section 8.1.

Events of Default

 

98

Section 8.2.

Application of Proceeds from Collateral

 

101

 

 

 

 

ARTICLE IX

THE ADMINISTRATIVE AGENT

 

102

Section 9.1.

Appointment of the Administrative Agent

 

102

Section 9.2.

Nature of Duties of the Administrative Agent

 

103

Section 9.3.

Lack of Reliance on the Administrative Agent

 

103

Section 9.4.

Certain Rights of the Administrative Agent

 

104

Section 9.5.

Reliance by the Administrative Agent

 

104

Section 9.6.

The Administrative Agent in its Individual Capacity

 

104

Section 9.7.

Successor Administrative Agent

 

104

Section 9.8.

Withholding Tax

 

105

Section 9.9.

The Administrative Agent May File Proofs of Claim

 

106

Section 9.10.

Authorization to Execute Other Loan Documents

 

107

Section 9.11.

Collateral and Guaranty Matters

 

107

Section 9.12.

[Reserved.]

 

107

Section 9.13.

Right to Realize on Collateral and Enforce Guarantee

 

107

Section 9.14.

Secured Bank Product Obligations and Hedging Obligations

 

108

 

 

 

 

ARTICLE X

MISCELLANEOUS

 

108

Section 10.1.

Notices

 

108

Section 10.2.

Waiver; Amendments

 

112

Section 10.3.

Expenses; Indemnification

 

114

Section 10.4.

Successors and Assigns

 

115

Section 10.5.

Governing Law; Jurisdiction; Consent to Service of Process

 

120

Section 10.6.

WAIVER OF JURY TRIAL

 

120

Section 10.7.

Right of Set-off

 

121

Section 10.8.

Counterparts; Integration

 

121

Section 10.9.

Survival

 

122

Section 10.10.

Severability

 

122

Section 10.11.

Confidentiality

 

122

Section 10.12.

Interest Rate Limitation

 

123

Section 10.13.

Waiver of Effect of Corporate Seal

 

123

Section 10.14.

Patriot Act

 

123

 

iii

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Section 10.15.

No Advisory or Fiduciary Responsibility

 

123

Section 10.16.

Location of Closing

 

124

 

iv

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Schedules

 

Schedule I

-

Commitment Amounts

Schedule 4.5

-

Environmental Matters

Schedule 4.11

-

Real Estate

Schedule 4.14

-

Loan Parties

Schedule 4.16

-

Deposit Accounts

Schedule 4.19

-

Material Agreements

Schedule 7.1

-

Existing Indebtedness

Schedule 7.2

-

Existing Liens

Schedule 7.4

-

Existing Investments

 

 

 

Exhibits

 

 

 

 

 

Exhibit A

-

Form of Assignment and Acceptance

Exhibit C

-

Form of Borrowing Base Certificate

 

 

 

Exhibit 2.3

-

Form of Notice of Revolving Borrowing

Exhibit 2.4

-

Form of Notice of Swingline Borrowing

Exhibit 2.22

-

Tax Certificates

Exhibit 3.1(b)(v)

-

Form of Officer’s Certificate

Exhibit 5.1(d)

-

Form of Compliance Certificate

 

v

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CREDIT AGREEMENT

 

THIS CREDIT AGREEMENT (this “Agreement”) is made and entered into as of June 24,
2016, by and among TESSCO TECHNOLOGIES, INCORPORATED, a Delaware corporation
(“Parent”), TESSCO INCORPORATED, a Delaware corporation (“TESSCO”), GW SERVICE
SOLUTIONS, INC., a Delaware corporation (“GW”), TESSCO SERVICE SOLUTIONS, INC.,
a Delaware corporation (“SERVICE”), and TCPM, a Delaware corporation (“TCPM”;
together with TESSCO, SERVICE, and GW, each a “Borrower,” and, collectively, the
“Borrowers”), the several banks and other financial institutions and lenders
from time to time party hereto (the “Lenders”), and SUNTRUST BANK, in its
capacity as administrative agent for the Lenders (the “Administrative Agent”),
as issuing bank (the “Issuing Bank”) and as swingline lender (the “Swingline
Lender”).

 

W I T N E S S E T H:

 

WHEREAS, Parent and the Borrowers have requested that the Lenders establish a
$35,000,000 revolving credit facility in favor of the Borrowers;

 

WHEREAS, subject to the terms and conditions of this Agreement, the Lenders, the
Issuing Bank and the Swingline Lender, to the extent of their respective
Commitments as defined herein, are willing severally to establish the requested
revolving credit facility, letter of credit subfacility and swingline
subfacility in favor of the Borrowers;

 

NOW, THEREFORE, in consideration of the premises and the mutual covenants herein
contained, each Borrower, the Lenders, the Administrative Agent, the Issuing
Bank and the Swingline Lender agree as follows:

 

ARTICLE I

 

DEFINITIONS; CONSTRUCTION

 

Section 1.1.                                Definitions.  In addition to the
other terms defined herein, the following terms used herein shall have the
meanings herein specified (to be equally applicable to both the singular and
plural forms of the terms defined):

 

“Account Debtor” shall mean “account debtor,” as defined in Article 9 of the
UCC.

 

“Accounts” shall mean “accounts,” as defined in Article 9 of the UCC.

 

“Acquisition” shall mean (a) any purchase or other acquisition by the Parent,
any Borrower, or any of their respective Subsidiaries of the Capital Stock of
any other Person (other than a Subsidiary of the Parent or any Borrower)
organized in the United States (with substantially all of the assets of such
Person and its Subsidiaries located in the United States), pursuant to which
such Person shall become a Subsidiary of the Parent, any Borrower, or any of
their respective Subsidiaries or shall be merged with the Parent, any Borrower,
or any of their respective Subsidiaries or (b) any acquisition by the Parent,
any Borrower, or any of their respective Subsidiaries of the assets of any
Person (other than a Subsidiary of the Parent or any

 

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Borrower) that constitute all or substantially all of the assets of such Person
or a division or business unit of such Person, whether through purchase, merger
or other business combination or transaction (and substantially all of such
assets, division or business unit are located in the United States).  With
respect to a determination of the amount of an Acquisition, such amount shall
include all consideration (including any deferred payments) set forth in the
applicable agreements governing such Acquisition as well as the assumption of
any Indebtedness in connection therewith.

 

“Additional Lender” shall have the meaning set forth in Section 2.25.

 

“Administrative Agent” shall have the meaning set forth in the introductory
paragraph hereof.

 

“Administrative Questionnaire” shall mean, with respect to each Lender, an
administrative questionnaire in the form provided by the Administrative Agent
and submitted to the Administrative Agent duly completed by such Lender.

 

“Affiliate” shall mean, as to any Person, any other Person that directly, or
indirectly through one or more intermediaries, Controls, is Controlled by, or is
under common Control with, such Person.  For the purposes of this definition,
“Control” shall mean the power, directly or indirectly, either to (i) vote ten
percent or more of the securities having ordinary voting power for the election
of directors (or persons performing similar functions) of a Person or
(ii) direct or cause the direction of the management and policies of a Person,
whether through the ability to exercise voting power, by control or otherwise. 
The terms “Controlled by” and “under common Control with” have the meanings
correlative thereto.

 

“Agent Advance Exposure” shall mean, with respect to each Lender, the principal
amount of the Agent Advances in which such Lender is legally obligated either to
make a Loan or to purchase a participation in accordance with Section 2.6, which
shall equal such Lender’s Pro Rata Share of all outstanding Agent Advances.

 

“Agent Advances” shall have the meaning specified in Section 2.6.

 

“Aggregate Revolving Commitment Amount” shall mean the aggregate principal
amount of the Aggregate Revolving Commitments from time to time.  On the Closing
Date, the Aggregate Revolving Commitment Amount is $35,000,000.

 

“Aggregate Revolving Commitments” shall mean, collectively, all Revolving
Commitments of all Lenders at any time outstanding.

 

“Aggregate Revolving Credit Exposure” shall mean the aggregate principal amount
of the Revolving Credit Exposure of all Lenders at any time.

 

“Anti-Corruption Laws” shall mean all laws, rules, and regulations of any
jurisdiction applicable to the Parent or its Subsidiaries from time to time
concerning or relating to bribery or corruption.

 

“Applicable Lending Office” shall mean, for each Lender, the “Lending Office” of
such Lender (or an Affiliate of such Lender) designated in the Administrative
Questionnaire

 

2

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submitted by such Lender or such other office of such Lender (or such Affiliate
of such Lender) as such Lender may from time to time specify to the
Administrative Agent and the Borrowers as the office by which its Loans are to
be made and maintained.

 

“Applicable Margin” shall mean a per annum percentage, determined as follows:

 

(a) on and after the Closing Date and to but not including the first
Determination Date occurring after the Closing Date, the percentage set forth in
Pricing Level I of the Pricing Grid (defined below); and

 

(b)                                 on the first Determination Date occurring
after the Closing Date, and on each Determination Date thereafter, the
Applicable Margin shall be adjusted based on the following table (the “Pricing
Grid”) and based on Average Availability for the calendar month ended most
recently before such Determination Date:

 

Pricing Grid

 

Pricing
Level

 

Average
Availability

 

Applicable
Margin for
Eurodollar
Loans

 

Applicable
Margin for
Base Rate
Loans

 

I

 

> $17,500,000

 

1.50

%

0.25

%

II

 

< $17,500,000

 

1.75

%

0.50

%

 

Any of the foregoing to the contrary notwithstanding, during the existence of an
Event of Default, at the election of the Required Lenders, the Applicable Margin
shall be those corresponding to Pricing Level II of the Pricing Grid.  As used
in this definition, the term “Determination Date” means (a) August 1, 2016, and
(b) thereafter, the first Business Day of each calendar month.  If any financial
statement or Compliance Certificate delivered hereunder is shown to be
inaccurate (regardless of whether this Agreement or the Commitments are in
effect when such inaccuracy is discovered), and such inaccuracy, if corrected,
would have led to the application of a higher Applicable Margin based upon the
Pricing Grid (the “Accurate Applicable Margin”) for any period that such
financial statement or Compliance Certificate covered, then (i) the Borrower
Agent shall immediately deliver to the Administrative Agent a correct financial
statement or Compliance Certificate, as the case may be, for such period,
(ii) the Applicable Margin shall be adjusted such that after giving effect to
the corrected financial statement or Compliance Certificate, as the case may be,
the Applicable Margin shall be reset to the Accurate Applicable Margin based
upon the Pricing Grid for such period and (iii) the Borrowers shall immediately
pay to the Administrative Agent, for the account of the Lenders, the accrued
additional interest owing as a result of such Accurate Applicable Margin for
such period.  The provisions of this definition shall not limit the rights of
the Administrative Agent and the Lenders with respect to Section 2.15(b) or
Article VIII.

 

3

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“Applicable Percentage” shall mean, as of any date, with respect to the
commitment fee as of such date, a percentage equal to 0.25% per annum.

 

“Applicable Rate” shall mean the Eurodollar Rate; provided, however, that
(i) the Applicable Rate shall be the Base Rate at all times contemplated in
Section 2.18; (ii) during the existence of an Event of Default, at the election
of the Administrative Agent or the Required Lenders, the Applicable Rate shall
be the Base Rate; and (iii) at any time that the Obligations hereunder have been
accelerated or deemed accelerated, the Applicable Rate shall be the Base Rate. 
Any change of the Applicable Rate from the Eurodollar Rate to the Base Rate, or
vice versa, in accordance with this definition shall be automatic and without
notice to any Person.

 

“Approved Fund” shall mean any Person (other than a natural Person) that is (or
will be) engaged in making, purchasing, holding or otherwise investing in
commercial loans and similar extensions of credit in the ordinary course of its
business and that is administered or managed by (i) a Lender, (ii) an Affiliate
of a Lender or (iii) an entity or an Affiliate of an entity that administers or
manages a Lender.

 

“Assignment and Acceptance” shall mean an assignment and acceptance entered into
by a Lender and an assignee (with the consent of any party whose consent is
required by Section 10.4(b)) and accepted by the Administrative Agent, in the
form of Exhibit A attached hereto or any other form approved by the
Administrative Agent.

 

“Availability” shall mean, as of any date of determination, the positive amount
(if any) by which (i) the lesser of (A) the Borrowing Base and (B) the Aggregate
Revolving Commitment Amount exceeds (ii) the Aggregate Revolving Credit Exposure
on such date.

 

“Availability Period” shall mean the period from the Closing Date to but
excluding the Revolving Commitment Termination Date.

 

“Average Availability” shall mean, with respect to any period, the sum of
Availability for each Business Day of such period, divided by the number of
Business Days in such period.

 

“Bail-In Action” shall mean the exercise of any Write-Down and Conversion Powers
by the applicable EEA Resolution Authority in respect of any liability of an EEA
Financial Institution.

 

“Bail-In Legislation” shall mean, with respect to any EEA Member Country
implementing Article 55 of Directive 2014/59/EU of the European Parliament and
of the Council of the European Union, the implementing law for such EEA Member
Country from time to time which is described in the EU Bail-In Legislation
Schedule.

 

“Bank Product Obligations” shall mean, collectively, all obligations and other
liabilities of any Loan Party to any Bank Product Provider arising with respect
to any Bank Products.

 

“Bank Product Provider” shall mean any Person that, at the time it provides any
Bank Product to any Loan Party, (i) is a Lender or an Affiliate of a Lender and
(ii) except when

 

4

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

 

the Bank Product Provider is SunTrust Bank and its Affiliates, has provided
prior written notice to the Administrative Agent which has been acknowledged by
the Borrowers of (x) the existence of such Bank Product, (y) the maximum dollar
amount of obligations arising thereunder (the “Bank Product Amount”) and (z) the
methodology to be used by such parties in determining the obligations under such
Bank Product from time to time.  In no event shall any Bank Product Provider
acting in such capacity be deemed a Lender for purposes hereof to the extent of
and as to Bank Products except that each reference to the term “Lender” in
Article IX and Section 10.3(b) shall be deemed to include such Bank Product
Provider and in no event shall the approval of any such person in its capacity
as Bank Product Provider be required in connection with the release or
termination of any security interest or Lien of the Administrative Agent.  The
Bank Product Amount may be changed from time to time upon written notice to the
Administrative Agent by the applicable Bank Product Provider.  No Bank Product
Amount may be established at any time that a Default or Event of Default exists.

 

“Bank Product Reserves” shall mean all reserves that the Administrative Agent,
from time to time, establishes in its Permitted Discretion for Bank Products.

 

“Bank Products” shall mean any of the following services provided to any Loan
Party by any Bank Product Provider: (a) any treasury or other cash management
services, including deposit accounts, automated clearing house (ACH) origination
and other funds transfer, depository (including cash vault and check deposit),
zero balance accounts and sweeps, return items processing, controlled
disbursement accounts, positive pay, lockboxes and lockbox accounts, account
reconciliation and information reporting, payables outsourcing, payroll
processing, trade finance services, investment accounts and securities accounts,
and (b) card services, including credit cards (including purchasing cards and
commercial cards), prepaid cards, including payroll, stored value and gift
cards, merchant services processing, and debit card services.

 

“Bankruptcy Code” shall mean Title 11 of the United States Code entitled
“Bankruptcy,” including the Federal Rules of Bankruptcy Procedure and any
applicable local bankruptcy rules.

 

“Base Rate” shall mean the highest of (i) the per annum rate which the
Administrative Agent announces from time to time as its prime lending rate, as
in effect from time to time, (ii) the Federal Funds Rate, as in effect from time
to time, plus 0.50% per annum and (iii) the Eurodollar Rate determined on a
daily basis for an interest period of one month, plus 1.00% per annum (any
changes in such rates to be effective as of the date of any change in such
rate).  The Administrative Agent’s prime lending rate is a reference rate and
does not necessarily represent the lowest or best rate actually charged to any
customer.  The Administrative Agent may make commercial loans or other loans at
rates of interest at, above, or below the Administrative Agent’s prime lending
rate.

 

“Benefit Arrangement” shall mean an “employee benefit plan” within the meaning
of Section 3(3) of ERISA, which is neither a Plan nor a Multiemployer Plan, and
which is maintained, sponsored or otherwise contributed to by Parent, any of its
Subsidiaries, or an ERISA Affiliate.

 

5

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

 

“Borrower” and “Borrowers” shall have the meanings given such terms in the
introductory paragraph hereof.

 

“Borrower Agent” shall have the meaning set forth in Section 2.30(e).

 

“Borrowing” shall mean a borrowing consisting of (i) Revolving Loans made on the
same date, (ii) a Swingline Loan, or (iii) an Agent Advance.  A “Swingline
Borrowing” shall mean a Borrowing of a Swingline Loan.  A “Revolving Borrowing”
shall mean a Borrowing of Revolving Loans.

 

“Borrowing Base” shall mean, as of any date of determination by the
Administrative Agent, from time to time, an amount equal to:

 

(a)                                 85% of the Dollar Equivalent of the book
value of Eligible Accounts at such time; less

 

(b)                                 Reserves.

 

“Borrowing Base Certificate” shall mean a certificate of a Responsible Officer
of the Borrower Agent substantially in the form of Exhibit C, or in such form as
otherwise agreed to by the Administrative Agent and the Borrower Agent.

 

“Business Day” shall mean any day other than (i) a Saturday, Sunday or other day
on which commercial banks in Atlanta, Georgia, are authorized or required by law
to close and (ii) if such day relates to any determination of LIBOR, any day on
which banks are not open for dealings in Dollar deposits in the London interbank
market.

 

“Canadian Related Deposit Accounts” shall mean (a) that certain deposit account
no. 7775014272 maintained in Canada by Wells Fargo Bank, National Association,
or one of its Affiliates at Royal Bank of Canada and (b) that certain deposit
account no. 2000013833602 maintained in the United States by Parent at Wells
Fargo Bank, National Association.

 

“Capital Expenditures” shall mean, for any period, without duplication, (i) the
additions to property, plant and equipment and other capital expenditures of the
Parent and its Subsidiaries that are (or would be) set forth on a consolidated
statement of cash flows of the Parent and its Subsidiaries for such period
prepared in accordance with GAAP and (ii) Capital Lease Obligations incurred by
the Parent and its Subsidiaries during such period, excluding any expenditure to
the extent such expenditure is part of the aggregate amounts payable in
connection with, or other consideration for, any Permitted Acquisition
consummated during or before such period.

 

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

 

6

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“Capital Stock” shall mean all shares, options, warrants, general or limited
partnership interests, membership interests or other equivalents (regardless of
how designated) of or in a corporation, partnership, limited liability company
or equivalent entity whether voting or nonvoting, including common stock,
preferred stock or any other “equity security” (as such term is defined in
Rule 3a11-1 of the General Rules and Regulations promulgated by the Securities
and Exchange Commission under the Exchange Act).

 

“Cash Collateralize” shall mean, in respect of any obligations, to provide and
pledge (as a first-priority perfected security interest) cash collateral for
such obligations in Dollars with the Administrative Agent pursuant to
documentation in form and substance reasonably satisfactory to the
Administrative Agent (and “Cash Collateralized” and “Cash Collateralization”
have the corresponding meanings).

 

“Cash Dominion Period” each period commencing on the date on which Availability
shall have been less than $12,500,000 for five consecutive Business Days or an
Event of Default occurs and ending on the first date thereafter on which
Availability has been equal to or greater than $12,500,000 for 30 consecutive
calendar days and no Event of Default exists.

 

“Cash Management Bank” shall have the meaning set forth in Section 5.11.

 

“Change in Control” shall mean the occurrence of one or more of the following
events: (i) any sale, lease, exchange or other transfer (in a single transaction
or a series of related transactions) of all or substantially all of the assets
of any Loan Party (other than as a result of an transaction expressly permitted
by this Agreement) to any Person or “group” (within the meaning of the Exchange
Act and the rules of the Securities and Exchange Commission thereunder in effect
on the date hereof), (ii) the acquisition of ownership, directly or indirectly,
beneficially or of record, by any Person or “group” (within the meaning of the
Exchange Act and the rules of the Securities and Exchange Commission thereunder
as in effect on the date hereof), other than Permitted Holders, of 35% or more
of the outstanding shares of the voting equity interests of the Parent,
(iii) during any period of 12 consecutive months, a majority of the members of
the board of directors or other equivalent governing body of the Parent cease to
be composed of individuals who are Continuing Directors, or (iv) Parent ceases,
for whatever reason, to own, directly or indirectly, 100% of the Capital Stock
issued by each other Loan Party (other than as a result of a transaction
expressly permitted by this Agreement).

 

“Change in Law” shall mean (i) the adoption of any applicable law, rule or
regulation after the date of this Agreement, (ii) any change in any applicable
law, rule or regulation, or any change in the interpretation, implementation or
application thereof, by any Governmental Authority after the date of this
Agreement, or (iii) compliance by any Lender (or its Applicable Lending Office)
or the Issuing Bank (or, for purposes of Section 2.20(b), by the Parent Company
of such Lender or the Issuing Bank, if applicable) with any request, guideline
or directive (whether or not having the force of law) of any Governmental
Authority made or issued after the date of this Agreement; provided that for
purposes of this Agreement, (A) the Dodd-Frank Wall Street Reform and Consumer
Protection Act and all requests, rules, guidelines or directives in connection
therewith and (B) all requests, rules, guidelines or directives promulgated by
the Bank for International Settlements, the Basel Committee on Banking

 

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Supervision (or any successor or similar authority) or the United States or
foreign regulatory authorities, in each case pursuant to Basel III, shall in
each case be deemed to be a “Change in Law,” regardless of the date enacted,
adopted or issued.

 

“Closing Date” shall mean June 24, 2016.

 

“Code” shall mean the Internal Revenue Code of 1986, as amended and in effect
from time to time.

 

“Collateral” shall mean all personal property and assets of the Loan Parties
(whether now existing or hereafter arising)  that is or is purported to be
subject to a Lien in favor of the Administrative Agent pursuant to the Loan
Documents to secure the whole or any part of the Obligations or any Guarantee
thereof, and shall include, without limitation, all proceeds thereof.

 

“Collateral Access Agreement” shall mean each landlord waiver or bailee
agreement granted to, and in form and substance reasonably acceptable to, the
Administrative Agent.

 

“Collateral Documents” shall mean, collectively, the Guaranty and Security
Agreement, the Control Account Agreements, all Collateral Access Agreements,
each Information Certificate, and all other documents, instruments, or
agreements now or hereafter securing or perfecting the Liens securing the whole
or any part of the Obligations or any Guarantee thereof, all UCC financing
statements, fixture filings and stock powers, and all other documents,
instruments, agreements and certificates executed and delivered by any Loan
Party to the Administrative Agent and the Lenders in connection with the
foregoing.

 

“Collections Accounts” shall mean (i) one or more deposit accounts established
after the Closing Date and maintained by the Loan Parties at SunTrust Bank and
designated as a Collections Account by Borrower Agent and Administrative Agent
and (ii) such other deposit account as may be further designated by the Borrower
Agent as a Collections Account and approved by the Administrative Agent in
writing.

 

“Commitment” shall mean a Revolving Commitment or a Swingline Commitment or any
combination thereof (as the context shall permit or require).

 

“Commodity Exchange Act” shall mean the Commodity Exchange Act (7 U.S.C. § 1 et
seq.), as amended and in effect from time to time, and any successor statute.

 

“Compliance Certificate” shall mean a certificate from the principal executive
officer or the principal financial officer of the Borrower Agent in the form of,
and containing the certifications set forth in, the certificate attached hereto
as Exhibit 5.1(d).

 

“Concentration Account” shall mean (i) that certain deposit account established
and maintained by the Borrower Agent at SunTrust Bank, account no.
1000041097725, and (ii) any other deposit account established and maintained by
the Loan Parties at Administrative Agent which is designated by the Borrower
Agent as the Concentration Account and approved by Administrative Agent in
writing.

 

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“Consolidated EBITDA” shall mean, for the Parent and its Subsidiaries for any
period, an amount equal to the sum of the following (calculated on a
consolidated basis for such period):  (i) Consolidated Net Income for such
period plus (ii) to the extent deducted in determining Consolidated Net Income
for such period, and without duplication, (A) Consolidated Interest Expense,
(B) income tax expense determined on a consolidated basis in accordance with
GAAP, (C) depreciation and amortization determined on a consolidated basis in
accordance with GAAP, (D) non-cash charges related to Parent’s stock
compensation plans, (E) non-cash charges arising from the write down of goodwill
and/or indefinite lived intangible assets, (F) all other non-cash charges
determined on a consolidated basis in accordance with GAAP (provided, that the
amount added-back pursuant to this clause (F) shall not exceed 10% of
Consolidated EBITDA (calculated without giving effect to this clause (F), unless
otherwise approved by the Administrative Agent)), and (G) transaction costs and
expenses paid in cash in connection with the Loan Documents in an aggregate
amount not to exceed $500,000; provided that, for purposes of calculating
compliance with the financial covenants set forth in Article VI, to the extent
that during such period any Loan Party shall have consummated a Permitted
Acquisition or other Acquisition approved in writing by the Required Lenders, or
any sale, transfer or other disposition of any Person, business, property or
assets, Consolidated EBITDA shall be calculated on a Pro Forma Basis with
respect to such Person, business, property or assets so acquired or disposed of.

 

“Consolidated Fixed Charges” shall mean, for the Parent and its Subsidiaries for
any period, the sum (without duplication) of (i) Consolidated Interest Expense
paid in cash for such period, (ii) scheduled principal payments made on
Consolidated Total Debt during such period, and (iii) Restricted Payments paid
in cash to Persons other than the Loan Parties during such period.

 

“Consolidated Interest Expense” shall mean, for the Parent and its Subsidiaries
for any period, determined on a consolidated basis in accordance with GAAP, the
sum, without duplication, of (i) total interest expense, including, without
limitation, the interest component of any payments in respect of Capital Lease
Obligations, capitalized or expensed during such period (whether or not actually
paid during such period) plus (ii) the net amount payable (or minus the net
amount receivable) with respect to Hedging Transactions during such period
(whether or not actually paid or received during such period).

 

“Consolidated Net Income” shall mean, for the Parent and its Subsidiaries for
any period, the net income (or loss) of the Parent and its Subsidiaries for such
period determined on a consolidated basis in accordance with GAAP; provided,
that there shall be excluded from Consolidated Net Income (to the extent
otherwise included therein) (i) any extraordinary gains or losses, (ii) any
gains attributable to write-ups of assets or the sale of assets (other than the
sale of inventory in the ordinary course of business), (iii) any losses
attributable to write-downs of assets or the sale of assets (other than the sale
of inventory in the ordinary course of business or the write-down of inventory,
as applicable), (iv) any equity interest of the Parent or any Subsidiary of the
Parent in the unremitted earnings of any Person that is not a Subsidiary and
(v) any income (or loss) of any Person accrued before the date it becomes a
Subsidiary or is merged into or consolidated with the Parent or any Subsidiary
or the date that such Person’s assets are acquired by the Parent or any
Subsidiary.

 

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“Consolidated Total Debt” shall mean, as of any date, all Indebtedness of the
Parent and its Subsidiaries measured on a consolidated basis as of such date,
but excluding Indebtedness of the type described in subsection (xi) of the
definition thereof.

 

“Continuing Director” shall mean, with respect to any period, any individuals
(A) who were members of the board of directors or other equivalent governing
body of the Parent on the first day of such period, (B) whose election or
nomination to that board or equivalent governing body was approved by
individuals referred to in clause (A) above constituting at the time of such
election or nomination at least a majority of that board or equivalent governing
body, or (C) whose election or nomination to that board or other equivalent
governing body was approved by individuals referred to in clauses (A) and
(B) above constituting at the time of such election or nomination at least a
majority of that board or equivalent governing body.

 

“Contractual Obligation” of any Person shall mean any provision of any security
issued by such Person or of any agreement, instrument or undertaking under which
such Person is obligated or by which it or any of the property in which it has
an interest is bound.

 

“Control Account Agreement” shall mean any tri-party agreement by and among a
Loan Party, the Administrative Agent and a depositary bank or securities
intermediary at which such Loan Party maintains a Controlled Account, in each
case in form and substance satisfactory to the Administrative Agent.

 

“Controlled Account” shall mean a deposit account which is subject to a Control
Account Agreement.

 

“Controlled Disbursement Account” shall mean (i) that certain deposit account
established and maintained by the Parent at Administrative Agent, account no.
200805940, and (ii) such other deposit account as may be further designated by
the Borrower Agent as a Controlled Disbursement Account and approved by the
Administrative Agent in writing.

 

“Credit Card Processor” shall mean any servicing or processing agent or any
factor or financial intermediary who facilitates, services, processes or manages
the credit authorization, billing transfer and/or payment procedures with
respect to any Loan Party’s sales transactions involving credit card or debit
card purchases by customers using credit cards or debit cards.

 

“Credit Card Processor Agreement” shall mean an agreement in form and substance
reasonably satisfactory to the Administrative Agent by and among the
Administrative Agent, a Loan Party, and a Credit Card Processor, as applicable,
pursuant to which, among other things, such Loan Party irrevocably instructs
such Credit Card Processor to forward all items of payment owing to such Loan
Party directly to a Collections Account or the Concentration Account and, if
required by the Administrative Agent, such Credit Card Processor acknowledges
such notice and agrees to comply with the same, in each case, as the same may be
amended, restated, supplemented, or otherwise modified from time to time.

 

“Customer Dispute” shall mean all instances in which (i) a customer of a Loan
Party has rejected or returned goods provided by a Loan Party and such return or
rejection has not been accepted by such Loan Party as a valid return or
rejection, or (ii) a customer of a Loan

 

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Party has otherwise affirmatively asserted grounds for nonpayment of an Account,
including any repossession of goods by such Loan Party, or any claim by an
Account Debtor of total or partial failure of delivery, set off, counterclaim,
or breach of warranty.

 

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

 

“Default” shall mean any condition or event that, with the giving of notice or
the lapse of time or both, would constitute an Event of Default.

 

“Default Interest” shall have the meaning set forth in Section 2.15(b).

 

“Defaulting Lender”  shall mean, subject to Section 2.28(c), any Lender that
(a) has failed to (i) fund all or any portion of its Loans within two Business
Days of the date such Loans were required to be funded hereunder unless such
Lender notifies the Administrative Agent and the Borrower Agent in writing that
such failure is the result of such Lender’s determination that one or more
conditions precedent to funding (each of which conditions precedent, together
with any applicable default, shall be specifically identified in such writing)
has not been satisfied, or (ii) pay to the Administrative Agent, any Issuing
Bank, any Swingline Lender or any other Lender any other amount required to be
paid by it hereunder (including in respect of its participation in Letters of
Credit or Swingline Loans or in respect of an Agent Advance) within two Business
Days of the date when due, (b) has notified the Borrower Agent, the
Administrative Agent or any Issuing Bank or Swingline Lender in writing that it
does not intend to comply with its funding obligations hereunder, or has made a
public statement to that effect (unless such writing or public statement relates
to such Lender’s obligation to fund a Loan hereunder and states that such
position is based on such Lender’s determination that a condition precedent to
funding (which condition precedent, together with any applicable default, shall
be specifically identified in such writing or public statement) cannot be
satisfied), (c) has failed, within three Business Days after written request by
the Administrative Agent or the Borrower Agent, to confirm in writing to the
Administrative Agent and the Borrower Agent that it will comply with its
prospective funding obligations hereunder (provided that such Lender shall cease
to be a Defaulting Lender pursuant to this clause (c) upon receipt of such
written confirmation by the Administrative Agent and the Borrower Agent), or
(d) has, or has a direct or indirect Parent Company that has, (i) become the
subject of a proceeding under any Debtor Relief Law, (ii) had appointed for it a
receiver, custodian, conservator, trustee, administrator, assignee for the
benefit of creditors or similar Person charged with reorganization or
liquidation of its business or assets, including the Federal Deposit Insurance
Corporation or any other state or federal regulatory authority acting in such a
capacity, or (iii) become the subject of a Bail-in Action; provided that a
Lender shall not be a Defaulting Lender solely by virtue of the ownership or
acquisition of any equity interest in that Lender or any direct or indirect
Parent Company thereof by a Governmental Authority so long as such ownership
interest does not result in or provide such Lender with immunity from the
jurisdiction of courts within the United States or from the enforcement of
judgments or writs of attachment on its assets or permit such Lender (or such
Governmental Authority) to reject, repudiate, disavow or disaffirm any contracts
or agreements made with such Lender.  Any determination by the Administrative
Agent that a Lender is a

 

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Defaulting Lender under clauses (a) through (d) above shall be conclusive and
binding absent manifest error, and such Lender shall be deemed to be a
Defaulting Lender (subject to Section 2.28(c)) upon delivery of written notice
of such determination to the Borrower Agent, each Issuing Bank, each Swingline
Lender and each Lender.

 

“Dilution” shall mean, as of any date of determination and any applicable period
determined by Administrative Agent from time to time in its Permitted
Discretion, a percentage that is the result of dividing the Dollar amount of
(a) bad debt write downs, discounts, advertising allowances, credits, or other
dilutive items with respect to the Borrowers’ Accounts during such period, by
(b) the Borrowers’ billings with respect to Accounts during such period.

 

“Dilution Reserve” shall mean, as of any date of determination, an amount
sufficient to reduce the advance rate against Eligible Accounts by one
percentage point for each percentage point by which Dilution is in excess of
five percent, rounded up to the nearest one tenth of a percentage point.

 

“Dollar Equivalent” shall mean, at any time of determination, (a) with respect
to any amount in Dollars, such amount and (b) with respect to any amount
denominated in any other currency, the equivalent amount thereof in Dollars as
reasonably determined by the Administrative Agent or the applicable Loan Party,
as the case may be, at such time on the basis of the Spot Rate for the purchase
of dollars with such currency.

 

“Dollar(s)” and the sign “$” shall mean lawful money of the United States.

 

“Domestic Subsidiary” shall mean each Subsidiary of Parent that is organized
under the laws of the United States or any state or district thereof.

 

“EEA Financial Institution” shall mean (a) any credit institution or investment
firm established in any EEA Member Country which is subject to the supervision
of an EEA Resolution Authority, (b) any entity established in an EEA Member
Country which is a parent of an institution described in clause (a) of this
definition, or (c) any financial institution established in an EEA Member
Country which is a subsidiary of an institution described in clauses (a) or
(b) of this definition and is subject to consolidated supervision with its
parent.

 

“EEA Member Country” shall mean any of the member states of the European
Union, Iceland, Liechtenstein, and Norway.

 

“EEA Resolution Authority” shall mean any public administrative authority or any
person entrusted with public administrative authority of any EEA Member Country
(including any delegee) having responsibility for the resolution of any EEA
Financial Institution.

 

“EU Bail-In Legislation Schedule” shall mean the EU Bail-In Legislation Schedule
published by the Loan Market Association (or any successor person), as in effect
from time to time.

 

“Eligible Accounts” shall mean, at any particular date, all Accounts of each
Borrower that the Administrative Agent, in the exercise of its Permitted
Discretion, determines to be Eligible Accounts; provided, however, that, without
limiting the right of the Administrative

 

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Agent to establish other criteria of ineligibility, Eligible Accounts shall not
include any of the following Accounts:

 

(a)                                 Accounts with respect to which (i) more than
120 days have elapsed since the original invoice date or 60 days have elapsed
since the due date of the original invoice or (ii) in the case of Accounts which
are on “credit card” terms (meaning that the applicable Account Debtors will
make payment on such Accounts through or with the use of a credit card), 31 days
have elapsed since the original invoice date;

 

(b)                                 Accounts with respect to which any of the
representations, warranties, covenants and agreements contained in Section 4.21
are not or have ceased to be complete and correct or have been breached

 

(c)                                  Accounts with respect to which, in whole or
in part, a check, promissory note, draft, trade acceptance or other instrument
for the payment of money has been received, presented for payment and returned
uncollected or dishonored for any reason except to the extent the Account Debtor
subsequently honors such check, note, draft, acceptance or instrument or pays
such Account or part thereof;

 

(d)                                 Accounts as to which such Borrower has not
performed, as of the applicable date of calculation, all of its obligations then
required to have been performed, including, without limitation, the delivery of
merchandise or rendition of services applicable to such Accounts;

 

(e)                                  Accounts as to which any one or more of the
following events has occurred with respect to the Account Debtor on such
Accounts: (i) death or judicial declaration of incompetency of such Account
Debtor who is an individual; (ii) the filing by or against such Account Debtor
of a request or petition for liquidation, reorganization, arrangement,
adjustment of debts, adjudication as a bankrupt, winding-up, or other relief
under the bankruptcy, insolvency, or similar laws of the United States, any
state or territory thereof, or any foreign jurisdiction, now or hereafter in
effect; (iii) the making of any general assignment by such Account Debtor for
the benefit of creditors; (iv) the appointment of a receiver or trustee for such
Account Debtor or for any of the assets of such Account Debtor, including,
without limitation, the appointment of or taking possession by a “custodian,” as
defined in Bankruptcy Code; (v) the institution by or against such Account
Debtor of any other type of insolvency proceeding or of any formal or informal
proceeding for the dissolution or liquidation of, settlement of claims against,
or winding up of affairs of, such Account Debtor; (vi) the sale, assignment, or
transfer of all or substantially all of the assets of such Account Debtor unless
the obligations of such Account Debtor in respect of the Accounts are assumed by
and assigned to such purchaser or transferee; (vii) the nonpayment generally by
such Account Debtor of its debts as they become due as determined by the
Administrative Agent in its Permitted Discretion; or (viii) the cessation of the
business of such Account Debtor as a going concern;

 

(f)                                   Accounts which represent the remaining
obligations for partially paid invoices;

 

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(g)                                  Accounts owed by an Account Debtor which:
(i)(A) does not maintain its chief executive office or have a material presence
in the United States or in Canada and (B) is not organized under the laws of the
United States or any state or territory thereof or of Canada or any province
thereof (provided, however, that, any such Account shall be an Eligible Account,
subject to the following:  (1) it is payable by a letter of credit or banker’s
acceptance or insured under foreign credit insurance, in each case, on terms and
conditions satisfactory to the Administrative Agent in its Permitted Discretion;
(2) the Administrative Agent shall have implemented such Reserves with respect
to such Account as the Administrative Agent shall have determined from time to
time in the exercise of its Permitted Discretion (or, in lieu of such Reserves,
effected an alternate advance rate for such Account (in no case to exceed the
advance rate applicable to Accounts owing by an Account Debtor located in the
United States)); and (3) the amount of availability derived from such Account
and all other Accounts described in this proviso shall not exceed at any time
$3,000,000) or (ii) is the government of any country or sovereign state, or of
any state, municipality, or other political subdivision thereof, or of any
department, agency, public corporation, or other instrumentality thereof
(except, in the case of any Accounts owing by the U.S. government or any of its
departments, agencies, or authorities, such Account have been assigned to the
Administrative Agent in compliance with the Assignment of Claims Act (unless the
Administrative Agent, in its sole discretion, has agreed to the contrary in
writing));

 

(h)                                 Accounts owed by an Account Debtor which is
an Affiliate or employee of Parent or any of its Subsidiaries;

 

(i)                                     Accounts which are owed by an Account
Debtor to which Parent or any of its Subsidiaries is indebted in any way, or
which are subject to any right of setoff by the Account Debtor, including,
without limitation, for co-op advertising, rebates, incentives and promotions,
to the extent of such indebtedness or right of setoff and without duplication of
any such indebtedness or right of setoff accounted for in the calculation of
Dilution;

 

(j)                                    Accounts which are subject to any
Customer Dispute, but only to the extent of the amount in dispute;

 

(k)                                 Accounts which are owed by the government of
the United States, or any department, agency, public corporation, or other
instrumentality thereof, unless all required procedures for the effective
collateral assignment of the Accounts under the Federal Assignment of Claims Act
of 1940, as amended, have been complied with to the Administrative Agent’s
reasonable satisfaction with respect to such Accounts;

 

(l)                                     Accounts which are owed by any state,
municipality, territory or other political subdivision of the United States, or
any department, agency, public corporation, or other instrumentality thereof and
as to which the Administrative Agent determines in its Permitted Discretion that
the Administrative Agent’s security interest therein is not or cannot be
perfected or cannot, or would not be commercially or administratively practical,
to be enforced against the applicable Account Debtor;

 

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(m)                             Accounts which represent third-party leasing
transactions;

 

(n)                                 Accounts which represent sales on a
bill-and-hold, guaranteed sale, sale and return, sale on approval, consignment
or other repurchase or return basis;

 

(o)                                 Accounts which represent any contractual
obligation, based on a percentage of sales or otherwise, that must be collected
from the Account Debtor and paid by such Borrower to a third party as a
“pass-through” item, but only to the extent of the amount of such pass-through;

 

(p)                                 Accounts which are evidenced by a promissory
note or other instrument or arise on account of chattel paper;

 

(q)                                 Accounts as to which the applicable Account
Debtor has not been sent an invoice or which are partially billed;

 

(r)                                    Accounts with respect to which the
Account Debtor is located in a state or jurisdiction that requires, as a
condition to access to the courts of such jurisdiction, that a creditor qualify
to transact business, file a business activities report or other report or form,
or take one or more other actions, unless such Borrower has so qualified, filed
such reports or forms, or taken such actions (and, in each case, paid any
required fees or other charges), except to the extent that such Borrower may
qualify subsequently as a foreign entity authorized to transact business in such
state or jurisdiction and gain access to such courts without incurring any cost
or penalty viewed by the Administrative Agent in its Permitted Discretion to be
significant in amount, and such later qualification cures any bar to access to
such courts to enforce payment of such Account (provided, however, that no
Account relating to any jurisdiction shall be deemed ineligible under this
clause (r) unless and until the Administrative Agent shall have given such
Borrower five Business Days’ notice as to such jurisdiction);

 

(s)                                   Accounts which are not a bona fide, valid
and, to the Borrowers’ knowledge, enforceable obligation of the Account Debtor
thereunder;

 

(t)                                    Accounts which are owed by an Account
Debtor with whom Parent or any of its Subsidiaries has any agreement or
understanding for deductions from the Accounts, except for discounts or
allowances which are made in the ordinary course of business for prompt payment
or volume purchases and which discounts or allowances are reflected in the
calculation of the face value of each invoice related to such Accounts, or
Accounts with respect to which a debit or chargeback has been issued or
generated, in each case to the extent of such deduction and without duplication
of any such deduction accounted for in the calculation of Dilution;

 

(u)                                 Accounts which are not subject to a valid
and continuing first-priority Lien in favor of the Administrative Agent pursuant
to the Loan Documents as to which all action necessary or desirable to perfect
such security interest shall have been taken, and to which such Borrower has
good and marketable title, free and clear of any Liens (other than Liens in
favor of the Administrative Agent and Permitted Encumbrances);

 

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(v)                                 Accounts which are owed by an Account Debtor
to the extent that such Account, together with all other Accounts owing by the
same Account Debtor and its Affiliates to Parent or any of its Subsidiaries,
exceeds (i) with respect to an Account Debtor which is Investment Grade, 30% of
all Eligible Accounts and (ii) in all other cases, 20% of all Eligible Accounts;

 

(w)                               Accounts which represent rebates, refunds or
other similar transactions, but only to the extent of the amount of such rebate,
refund or similar transaction;

 

(x)                                 Accounts as to which a security agreement,
financing statement, equivalent security or Lien instrument or continuation
statement is on file or of record naming a Borrower as debtor (or its
equivalent) in any public office, except any such as may have been filed in
favor of the Administrative Agent pursuant to the Loan Documents;

 

(y)                                 Accounts which did not arise in the ordinary
course of business of such Borrower out of the sale of goods or services by such
Borrower;

 

(z)                                  Accounts which are not payable in Dollars
or CAD; or

 

(aa)                          Accounts that are pre-billed Accounts or that
arise from progress billing.

 

Notwithstanding anything to the contrary contained herein, no assets acquired by
a Borrower pursuant to an Acquisition and no assets of any Person which was
acquired or formed pursuant to an Acquisition shall constitute Eligible Accounts
unless and until the Administrative Agent has completed or received (i) a field
examination of such assets and established Reserves (if applicable) therefor and
(ii) such other diligence as the Administrative Agent may reasonably require,
all of the results of the foregoing to be satisfactory to the Administrative
Agent in its Permitted Discretion.

 

“Environmental Laws” shall mean all laws, rules, regulations, codes, ordinances,
orders, decrees, judgments, injunctions, notices or binding agreements issued,
promulgated or entered into by or with any Governmental Authority relating in
any way to the environment, preservation or reclamation of natural resources,
the management, Release or threatened Release of any Hazardous Material or to
health and safety matters.

 

“Environmental Liability” shall mean any liability, contingent or otherwise
(including any liability for damages, costs of environmental investigation and
remediation, costs of administrative oversight, fines, natural resource damages,
penalties or indemnities), of the Parent or any of its Subsidiaries directly or
indirectly resulting from or based upon (i) any actual or alleged violation of
any Environmental Law, (ii) the generation, use, handling, transportation,
storage, treatment or disposal of any Hazardous Materials, (iii) any actual or
alleged exposure to any Hazardous Materials, (iv) the Release or threatened
Release of any Hazardous Materials or (v) any contract, agreement or other
consensual arrangement pursuant to which liability is assumed or imposed with
respect to any of the foregoing.

 

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“ERISA” shall mean the Employee Retirement Income Security Act of 1974, as
amended and in effect from time to time, and any successor statute thereto and
the regulations promulgated and rulings issued thereunder.

 

“ERISA Affiliate” shall mean any person that for purposes of Title I or Title IV
of ERISA or Section 412 of the Code would be deemed at any relevant time to be a
“single employer” or otherwise aggregated with the Parent or any of its
Subsidiaries under Section 414(b), (c), (m) or (o) of the Code or Section 4001
of ERISA.

 

“ERISA Event” shall mean (i) any “reportable event” as defined in Section 4043
of ERISA with respect to a Plan (other than an event as to which the PBGC has
waived under subsection .22, .23, .25, .27 or .28 of PBGC Regulation
Section 4043 the requirement of Section 4043(a) of ERISA that it be notified of
such event); (ii) any failure to make a required contribution to any Plan that
would result in the imposition of a lien or other encumbrance or the provision
of security under Section 430 of the Code or Section 303 or 4068 of ERISA, or
the arising of such a lien or encumbrance, there being or arising any “unpaid
minimum required contribution” or “accumulated funding deficiency” (as defined
or otherwise set forth in Section 4971 of the Code or Part 3 of Subtitle B of
Title 1 of ERISA), whether or not waived, or any filing of any request for or
receipt of a minimum funding waiver under Section 412 of the Code or Section 303
of ERISA with respect to any Plan or Multiemployer Plan, or that such filing may
be made, or any determination that any Plan is, or is expected to be, in at-risk
status under Title IV of ERISA; (iii) any incurrence by the Parent, any of its
Subsidiaries, or any of their respective ERISA Affiliates of any liability under
Title IV of ERISA with respect to any Plan or Multiemployer Plan (other than for
premiums due and not delinquent under Section 4007 of ERISA); (iv) any
institution of proceedings, or the occurrence of an event or condition which
would reasonably be expected to constitute grounds for the institution of
proceedings by the PBGC, under Section 4042 of ERISA for the termination of, or
the appointment of a trustee to administer, any Plan; (v) any incurrence by the
Parent, any of its Subsidiaries, or any of their respective ERISA Affiliates of
any liability with respect to the withdrawal or partial withdrawal from any Plan
or Multiemployer Plan, or the receipt by the Parent, any of its Subsidiaries, or
any of their respective ERISA Affiliates of any notice that a Multiemployer Plan
is in endangered or critical status under Section 305 of ERISA; (vi) any receipt
by the Parent, any of its Subsidiaries, or any of their respective ERISA
Affiliates of any notice, or any receipt by any Multiemployer Plan from the
Parent, any of its Subsidiaries, or any of their respective ERISA Affiliates of
any notice, concerning the imposition of Withdrawal Liability or a determination
that a Multiemployer Plan is, or is expected to be, insolvent or in
reorganization, within the meaning of Title IV of ERISA; (vii) engaging in a
non-exempt prohibited transaction within the meaning of Section 4975 of the Code
or Section 406 of ERISA with respect to a Plan; or (viii) any filing of a notice
of intent to terminate any Plan if such termination would require material
additional contributions in order to be considered a standard termination within
the meaning of Section 4041(b) of ERISA, any filing under Section 4041(c) of
ERISA of a notice of intent to terminate any Plan, or the termination of any
Plan under Section 4041(c) of ERISA.

 

“Eurodollar,” when used in reference to the Loans, refers to whether the Loans
bear interest at a rate determined by reference to the Eurodollar Rate.

 

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“Eurodollar Rate” shall mean, at any time of determination, the rate per annum
obtained by dividing (i) LIBOR by (ii) a percentage equal to 1.00 minus the
Eurodollar Reserve Percentage.

 

“Eurodollar Reserve Percentage” shall mean the aggregate of the maximum reserve
percentages (including, without limitation, any emergency, supplemental, special
or other marginal reserves) expressed as a decimal (rounded upwards, if
necessary, to the next 1/100 of 1%) in effect on any day to which the
Administrative Agent is subject with respect to the Eurodollar Rate pursuant to
regulations issued by the Board of Governors of the Federal Reserve System (or
any Governmental Authority succeeding to any of its principal functions) with
respect to eurocurrency funding (currently referred to as “eurocurrency
liabilities” under Regulation D).  Eurodollar Loans shall be deemed to
constitute eurocurrency funding and to be subject to such reserve requirements
without the benefit of or credit for proration, exemptions or offsets that may
be available from time to time to any Lender under Regulation D.  The Eurodollar
Reserve Percentage shall be adjusted automatically on and as of the effective
date of any change in any reserve percentage.

 

“Event of Default” shall have the meaning set forth in Section 8.1.

 

“Exchange Act” shall mean the Securities Exchange Act of 1934, as amended and in
effect from time to time.

 

“Excluded Swap Obligation”  shall mean, with respect to any Guarantor, any Swap
Obligation if, and to the extent that, all or a portion of the Guarantee of such
Guarantor of, or the grant by such Guarantor of a security interest to secure,
such Swap Obligation (or any Guarantee thereof) is or becomes illegal under the
Commodity Exchange Act or any rule, regulation or order of the Commodity Futures
Trading Commission (or the application or official interpretation of any
thereof) by virtue of such Guarantor’s failure for any reason to constitute an
“eligible contract participant” as defined in the Commodity Exchange Act at the
time the Guarantee of such Guarantor becomes effective with respect to such
related Swap Obligation.  If a Swap Obligation arises under a master agreement
governing more than one swap, such exclusion shall apply only to the portion of
such Swap Obligation that is attributable to swaps for which such Guarantee or
security interest is or becomes illegal.

 

“Excluded Taxes” shall mean any of the following Taxes imposed on or with
respect to a Recipient or required to be withheld or deducted from a payment to
a Recipient, (a) Taxes imposed on or measured by net income (however
denominated), franchise Taxes, and branch profits Taxes, in each case,
(i) imposed as a result of such Recipient being organized under the laws of, or
having its principal office or, in the case of any Lender, its applicable
lending office located in, the jurisdiction imposing such Tax (or any political
subdivision thereof) or (ii) that are Other Connection Taxes, (b) in the case of
a Lender, U.S. federal withholding Taxes imposed on amounts payable to or for
the account of such Lender with respect to an applicable interest in a Loan or
Commitment pursuant to a law in effect on the date on which (i) such Lender
acquires such interest in the Loan or Commitment (other than pursuant to an
assignment request by the Borrower Agent under Section 2.27) or (ii) such Lender
changes its lending office, except in each case to the extent that, pursuant to
Section 2.22, amounts with respect to such Taxes were payable either to such
Lender’s assignor immediately before such

 

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Lender became a party hereto or to such Lender immediately before it changed its
lending office, (c) Taxes attributable to such Recipient’s failure to comply
with Section 2.22 and (d) any U.S. federal withholding Taxes imposed under
FATCA.

 

“Existing Revolving Credit Agreement” shall mean that certain Credit Agreement,
dated as of May 31, 2007, by and among Parent, certain of its Subsidiaries party
thereto, the lenders from time to time parties thereto, and SunTrust Bank, as
the administrative agent, as amended or modified from time to time.

 

“Existing Lenders” shall mean all lenders party to (or, in each case, the
administrative agent thereof) (a) the Existing Revolving Credit Agreement and
(b) the Existing Term Loan Agreement, each, as of the Closing Date.

 

“Existing Term Loan Agreement”  shall mean that certain Credit Agreement, dated
as of June 30, 2004, by and among certain Subsidiaries of Parent party thereto,
the lenders from time to time parties thereto, and Wells Fargo Bank, National
Association (as successor to Wachovia Bank, National Association), as the
administrative agent, as amended or modified from time to time.

 

“Family Member” shall mean, with respect to any individual, any other individual
having a relationship with such individual by blood (to the second degree of
consanguinity), marriage, or legal adoption.

 

“Family Trust” shall mean, with respect to any individual, trusts or estate
planning vehicles established for the benefit of such individual or his/her
Family Members and no other Persons.

 

“FATCA” shall mean Sections 1471 through 1474 of the Code, as of the date of
this Agreement (or any amended or successor version that is substantively
comparable and not materially more onerous to comply with), any current or
future regulations or official interpretations thereof and any agreements
entered into pursuant to Section 1471(b)(1) of the Code.

 

“Federal Funds Rate” shall mean, for any day, the rate per annum (rounded
upwards, if necessary, to the next 1/100 of 1%) equal to the weighted average of
the rates on overnight Federal funds transactions with member banks of the
Federal Reserve System, as published by the Federal Reserve Bank of New York on
the next succeeding Business Day or, if such rate is not so published for any
Business Day, the Federal Funds Rate for such day shall be the average (rounded
upwards, if necessary, to the next 1/100 of 1%) of the quotations for such day
on such transactions received by the Administrative Agent from three Federal
funds brokers of recognized standing selected by the Administrative Agent.

 

“Fee Letter” shall mean that certain fee letter, dated as of the Closing Date,
executed by SunTrust Robinson Humphrey, Inc., and SunTrust Bank and accepted by
the Parent and each Borrower, as the same may be amended, restated,
supplemented, or otherwise modified from time to time.

 

“Fiscal Month” shall mean any fiscal month of Parent.

 

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“Fiscal Quarter” shall mean any fiscal quarter of Parent.

 

“Fiscal Year” shall mean any fiscal year of Parent.

 

“Fixed Charge Coverage Ratio” shall mean, with respect to any applicable fiscal
period, the ratio of (a) the sum of (i) Consolidated EBITDA minus
(ii) Unfinanced Cash Capital Expenditures minus (iii) cash income taxes to
(b) Consolidated Fixed Charges, in each case measured for the 12 consecutive
Fiscal Months ending on or immediately before such date for which financial
statements are required to have been delivered under this Agreement.

 

“Foreign Lender” shall mean, as to any Borrower, (a) if such Borrower is a U.S.
Person, a Lender that is not a U.S. Person, and (b) if such Borrower is not a
U.S. Person, a Lender that is resident or organized under the laws of a
jurisdiction other than that in which such Borrower is resident for tax
purposes.

 

“Foreign Subsidiary” shall mean each Subsidiary of the Parent that is organized
under the laws of a jurisdiction other than one of the fifty states of the
United States or the District of Columbia.

 

“GAAP” shall mean generally accepted accounting principles in the United States
applied on a consistent basis and subject to the terms of Section 1.3.

 

“Governmental Authority” shall mean 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, legislative, judicial, taxing, regulatory or
administrative powers or functions of or pertaining to government (including any
supra-national bodies such as the European Union or the European Central Bank).

 

“Guarantee” of or by any Person (the “guarantor”) shall mean any obligation,
contingent or otherwise, of the guarantor guaranteeing or having the economic
effect of guaranteeing any Indebtedness or other obligation of any other Person
(the “primary obligor”) in any manner, whether directly or indirectly and
including any obligation, direct or indirect, of the guarantor (i) to purchase
or pay (or advance or supply funds for the purchase or payment of) such
Indebtedness or other obligation or to purchase (or to advance or supply funds
for the purchase of) any security for the payment thereof, (ii) to purchase or
lease property, securities or services for the purpose of assuring the owner of
such Indebtedness or other obligation of the payment thereof, (iii) to maintain
working capital, equity capital or any other financial statement condition or
liquidity of the primary obligor so as to enable the primary obligor to pay such
Indebtedness or other obligation or (iv) as an account party in respect of any
letter of credit or letter of guaranty issued in support of such Indebtedness or
obligation; provided that the term “Guarantee” shall not include endorsements
for collection or deposit in the ordinary course of business.  The amount of any
Guarantee shall be deemed to be an amount equal to the stated or determinable
amount of the primary obligation in respect of which such Guarantee is made or,
if not so stated or determinable, the maximum reasonably anticipated liability
in respect thereof (assuming such Person is required to perform thereunder) as
determined by such Person in good faith.  The term “Guarantee” used as a verb
has a corresponding meaning.

 

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“Guarantor” shall mean Parent and each of the Subsidiary Loan Parties.

 

“Guaranty and Security Agreement” shall mean the Guaranty and Security
Agreement, dated as of the date hereof, made by the Loan Parties in favor of the
Administrative Agent for the benefit of the Secured Parties.

 

“GW Related Deposit Account” mean that certain deposit account no. 2000026892915
established by Parent at Wells Fargo Bank, National Association.

 

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

 

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

 

“Hedging Obligations” of any Person shall mean any and all obligations of such
Person, whether absolute or contingent and howsoever and whensoever created,
arising, evidenced or acquired under (i) any and all Hedging Transactions,
(ii) any and all cancellations, buy backs, reversals, terminations or
assignments of any Hedging Transactions and (iii) any and all renewals,
extensions and modifications of any Hedging Transactions and any and all
substitutions for any Hedging Transactions.

 

“Hedging Transaction” of any Person shall mean (a) any transaction (including an
agreement with respect to any such transaction) now existing or hereafter
entered into by such Person that is a rate swap transaction, swap option, basis
swap, forward rate transaction, commodity swap, commodity option, equity or
equity index swap or option, bond option, interest rate option, foreign exchange
transaction, cap transaction, floor transaction, collar transaction, currency
swap transaction, cross-currency rate swap transaction, currency option, spot
transaction, credit protection transaction, credit swap, credit default swap,
credit default option, total return swap, credit spread transaction, repurchase
transaction, reverse repurchase transaction, buy/sell-back transaction,
securities lending transaction, or any other similar transaction (including any
option with respect to any of these transactions) or any combination thereof,
whether or not any such transaction is governed by or subject to any master
agreement, and (b) any and all transactions of any kind, and the related
confirmations, which are subject to the terms and conditions of, or governed by,
any form of master agreement published by the International Swaps and
Derivatives Association, Inc., any International Foreign Exchange Master
Agreement, or any other master agreement (any such master agreement, together
with

 

21

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any related schedules, a “Master Agreement”), including any such obligations or
liabilities under any Master Agreement.

 

“Increased Reporting Period” shall mean each period (a) commencing on the
earlier to occur of (i) a Default or Event of Default and (ii) the date on which
Availability is less than or equal to $5,000,000 and (b) ending on the first
date thereafter on which no Default or Event of Default exists and Availability
has been greater than $5,000,000 for 30 consecutive days.

 

“Increasing Lender” shall have the meaning set forth in Section 2.25.

 

“Incremental Commitment” shall have the meaning set forth in Section 2.25.

 

“Incremental Revolving Commitments” shall have the meaning set forth in
Section 2.25.

 

“Indebtedness” of any Person shall mean, without duplication, (i) all
obligations of such Person for borrowed money, (ii) all obligations of such
Person evidenced by bonds, debentures, notes or other similar instruments,
(iii) all obligations of such Person in respect of the deferred purchase price
of property or services (other than (A) trade payables incurred in the ordinary
course of business, (B) deferred compensation payable to directors, officers or
employees and (C) any purchase price adjustment, earnout or deferred payment of
a similar nature incurred in connection with any Permitted Acquisition which is
not a liability on Parent or its Subsidiaries’ balance sheet) (iv) all
obligations of such Person under any conditional sale or other title retention
agreement(s) relating to property acquired by such Person, (excluding trade
payables incurred in the ordinary course of business; provided that, for
purposes of Section 8.1(g), trade payables overdue by more than 120 days shall
be included in this definition except to the extent that any of such trade
payables are being disputed in good faith and by appropriate measures), (v) all
Capital Lease Obligations of such Person, (vi) all obligations, contingent or
otherwise, of such Person in respect of letters of credit, acceptances or
similar extensions of credit, (vii) all Guarantees of such Person of the type of
Indebtedness described in clauses (i) through (vi) above, (viii) all
Indebtedness of a third party secured by any Lien on property owned by such
Person, whether or not such Indebtedness has been assumed by such Person,
(ix) all obligations of such Person, contingent or otherwise, to purchase,
redeem, retire or otherwise acquire for value any Capital Stock of such Person,
(x) all Off-Balance Sheet Liabilities and (xi) all Hedging Obligations.  The
Indebtedness of any Person shall include the Indebtedness of any partnership or
joint venture in which such Person is a general partner or a joint venturer,
except to the extent that the terms of such Indebtedness provide that such
Person is not liable therefor.

 

“Indemnified Taxes” shall mean (a) Taxes other than Excluded Taxes, imposed on
or with respect to any payment made by or on account of any obligation of any
Loan Party under any Loan Document and (b) to the extent not otherwise described
in (a), Other Taxes.

 

“Information Certificate” shall mean each Information Certificate executed and
delivered from time to time by a Loan Party to Administrative Agent, as the same
may be amended, restated, supplemented, or otherwise modified from time to time.

 

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“Inventory” shall mean, collectively, “inventory” (as such term is defined in
Article 9 of the UCC).

 

“Investment Grade” shall mean a rating of (i) BBB — or higher by S&P, or
(ii) Baa3 or higher by Moody’s.

 

“Investments” shall have the meaning set forth in Section 7.4.

 

“IRS” shall mean the United States Internal Revenue Service.

 

“Issuing Bank” shall mean SunTrust Bank in its capacity as the issuer of Letters
of Credit pursuant to Section 2.24.

 

“LC Commitment” shall mean that portion of the Aggregate Revolving Commitments
that may be used by the Borrowers for the issuance of Letters of Credit. As of
the Closing Date, the LC Commitment is $5,000,000.

 

“LC Disbursement” shall mean a payment made by the Issuing Bank pursuant to a
Letter of Credit.

 

“LC Documents” shall mean all applications, agreements and instruments relating
to the Letters of Credit but excluding the Letters of Credit.

 

“LC Exposure” shall mean, at any time, the sum of (i) the aggregate undrawn
amount of all outstanding Letters of Credit at such time, plus (ii) the
aggregate amount of all LC Disbursements that have not been reimbursed by or on
behalf of the Borrowers at such time.  The LC Exposure of any Lender shall be
its Pro Rata Share of the total LC Exposure at such time.

 

“Lender-Related Hedge Provider” shall mean any Person that, at the time it
enters into a Hedging Transaction with any Loan Party, (i) is a Lender or an
Affiliate of a Lender and (ii) except when the Lender-Related Hedge Provider is
SunTrust Bank or any of its Affiliates, has provided prior written notice to the
Administrative Agent which has been acknowledged by the Borrower Agent of
(A) the existence of such Hedging Transaction and (B) the methodology to be used
by such parties in determining the obligations under such Hedging Transaction
from time to time.  In no event shall any Lender-Related Hedge Provider acting
in such capacity be deemed a Lender for purposes hereof to the extent of and as
to Hedging Obligations except that each reference to the term “Lender” in
Article IX and Section 10.3(b) shall be deemed to include such Lender-Related
Hedge Provider.  In no event shall the approval of any such Person in its
capacity as Lender-Related Hedge Provider be required in connection with the
release or termination of any security interest or Lien of the Administrative
Agent.

 

“Lenders” shall have the meaning set forth in the introductory paragraph hereof
and shall include, where appropriate, the Swingline Lender, each Increasing
Lender and each Additional Lender that joins this Agreement pursuant to
Section 2.25.

 

“Letter of Credit” shall mean any stand-by letter of credit issued pursuant to
Section 2.24 by the Issuing Bank for the account of a Borrower pursuant to the
LC Commitment.

 

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“LIBOR” shall mean, at any time of determination, the rate per annum (rounded
upwards, if necessary, to the nearest 1/100 of 1%) appearing on Reuters Screen
LIBOR01 Page (or any successor page) as the London interbank offered rate for
Dollar deposits at approximately 11:00 a.m. (London, England, time) two Business
Days before the first Business Day of the then current calendar month for an
interest period of one month; provided, that if such rate shall be less than
zero, such rate shall be deemed to be zero.  If for any reason such rate is not
available, LIBOR shall be the rate per annum reasonably determined by the
Administrative Agent as the rate of interest at which Dollar deposits in the
approximate amount of the Loans (at such time of determination) would be offered
by the Administrative Agent to major banks in the London interbank Eurodollar
market at their request at or about 10:00 a.m. two Business Days before the
first Business Day of the then current calendar month for an interest period of
one month.

 

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

 

“Liquidity Period” shall mean each period (i) commencing on the earlier to occur
of (A) the occurrence of an Event of Default and (B) the date on which
Availability is less than $10,000,000 and (ii) ending on the first date
thereafter on which no Default or Event of Default exists and Availability has
been greater than $10,000,000 for 30 consecutive days.

 

“Loan Documents” shall mean, collectively, this Agreement, the Collateral
Documents, the LC Documents, the Fee Letter, all Notices of Borrowing, all
Borrowing Base Certificates, all Compliance Certificates, any promissory notes
issued hereunder and any and all other instruments, agreements, documents, and
writings executed in connection with any of the foregoing.

 

“Loan Party” and “Loan Parties” shall mean Parent, each Borrower, and the
Subsidiary Loan Parties.

 

“Loans” shall mean all Revolving Loans, Swingline Loans, and Agent Advances in
the aggregate or any of them, as the context shall require, and shall include,
where appropriate, any loan made pursuant to Section 2.25.

 

“Master Funding Account” shall mean (i) that certain deposit account established
and maintained by the Parent at Administrative Agent, account no. 1000200578606,
and (ii) such other deposit account as may be further designated by the Borrower
Agent as the Master Funding Account and approved by the Administrative Agent in
writing.  The Master Funding Account is the ZBA master account with respect to
the Controlled Disbursement Account.

 

“Material Adverse Effect” shall mean, with respect to any event, act, condition
or occurrence of whatever nature (including any adverse determination in any
litigation, arbitration, or governmental investigation or proceeding), whether
singularly or in conjunction with any other event or events, act or acts,
condition or conditions, occurrence or occurrences whether or not related,
resulting in a material adverse change in, or a material adverse effect on,
(i) the

 

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business, results of operations, financial condition, assets or liabilities of
the Parent and its Subsidiaries taken as a whole, (ii) the ability of the Loan
Parties to perform any of their respective obligations under the Loan Documents,
(iii) the rights and remedies of the Administrative Agent, the Issuing Bank, the
Swingline Lender or the Lenders under any of the Loan Documents or (iv) the
legality, validity or enforceability of any of the Loan Documents.

 

“Material Agreements” shall mean (i) all agreements, indentures or notes
governing the terms of any Material Indebtedness, (ii) all employment and
non-compete agreements with management, (iii) all other agreements, documents,
contracts, indentures and instruments pursuant to which (A) Parent or any of its
Subsidiaries are contractually obligated to make payments in any 12 month period
of $2,500,000 or more, (B) any of Parent or any of its Subsidiaries’ customers
is obligated to pay more than $2,500,000 to Parent or its Subsidiaries during
any 12 month period and (C) a default, breach or termination thereof could
reasonably be expected to result in a Material Adverse Effect; provided, that
Material Agreements shall not include any agreement or other contract for the
purchase or other acquisition of Inventory in the ordinary course of business.

 

“Material Indebtedness” shall mean any Indebtedness (other than the Loans and
the Letters of Credit) of the Parent or any of its Subsidiaries individually or
in an aggregate committed or outstanding principal amount exceeding $1,000,000. 
For purposes of determining the amount of attributed Indebtedness from Hedging
Obligations, the “principal amount” of any Hedging Obligations at any time shall
be the Net Mark-to-Market Exposure of such Hedging Obligations.

 

“Moody’s” shall mean Moody’s Investors Service, Inc.

 

“Multiemployer Plan” shall mean any “multiemployer plan” as defined in
Section 4001(a)(3) of ERISA, which is contributed to by (or to which there is or
may be an obligation to contribute of) the Parent, any of its Subsidiaries, or
an ERISA Affiliate, and each such plan for the five-year period immediately
following the latest date on which the Parent, any of its Subsidiaries, or an
ERISA Affiliate contributed to or had an obligation to contribute to such plan.

 

“National Air Time” shall mean National Air Time, Inc., a Delaware corporation.

 

“Net Mark-to-Market Exposure” of any Person shall mean, as of any date of
determination with respect to any Hedging Obligation, the excess (if any) of all
unrealized losses over all unrealized profits of such Person arising from such
Hedging Obligation.  “Unrealized losses” shall mean the fair market value of the
cost to such Person of replacing the Hedging Transaction giving rise to such
Hedging Obligation as of the date of determination (assuming such Hedging
Transaction were to be terminated as of that date), and “unrealized profits”
shall mean the fair market value of the gain to such Person of replacing such
Hedging Transaction as of the date of determination (assuming such Hedging
Transaction were to be terminated as of that date).

 

“Non-Defaulting Lender” shall mean, at any time, a Lender that is not a
Defaulting Lender.

 

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“Non-Public Information” shall mean any material non-public information (within
the meaning of United States federal and state securities laws) with respect to
the Loan Parties, their Affiliates, or any of their securities or loans.

 

“Non-U.S. Plan” shall mean any plan, fund (including, without limitation, any
superannuation fund) or other similar program established, contributed to
(regardless of whether through direct contributions or through employee
withholding) or maintained outside the United States by the Parent or one or
more of its Subsidiaries primarily for the benefit of employees of the Parent or
such Subsidiaries residing outside the United States, which plan, fund or other
similar program provides, or results in, retirement income, a deferral of income
in contemplation of retirement, or payments to be made upon termination of
employment, and which plan is not subject to ERISA or the Code.

 

“Notices of Borrowing” shall mean, collectively, the Notices of Revolving
Borrowing and the Notices of Swingline Borrowing.

 

“Notice of Revolving Borrowing” shall have the meaning set forth in Section 2.3.

 

“Notice of Swingline Borrowing” shall have the meaning set forth in Section 2.4.

 

“Obligations” shall mean (a) all amounts owing by the Loan Parties to the
Administrative Agent, the Issuing Bank, any Lender (including the Swingline
Lender) or the Sole Lead Arranger pursuant to or in connection with this
Agreement or any other Loan Document or otherwise with respect to any Loan or
Letter of Credit including, without limitation, all principal, interest
(including any interest accruing after the filing of any petition in bankruptcy
or the commencement of any insolvency, reorganization or like proceeding
relating to any Loan Party, whether or not a claim for post-filing or
post-petition interest is allowed in such proceeding), reimbursement
obligations, fees, expenses, indemnification and reimbursement payments, costs
and expenses (including all fees and expenses of counsel to the Administrative
Agent, the Issuing Bank and any Lender (including the Swingline Lender) incurred
pursuant to this Agreement or any other Loan Document), whether direct or
indirect, absolute or contingent, liquidated or unliquidated, now existing or
hereafter arising hereunder or thereunder, (b) all Hedging Obligations owed by
any Loan Party to any Lender-Related Hedge Provider, and (c) all Bank Product
Obligations, together with all renewals, extensions, modifications or
refinancings of any of the foregoing; provided, however, that with respect to
any Guarantor, the Obligations shall not include any Excluded Swap Obligations.

 

“OFAC” shall mean the U.S. Department of the Treasury’s Office of Foreign Assets
Control.

 

“Off-Balance Sheet Liabilities” of any Person shall mean (i) any repurchase
obligation or liability of such Person with respect to accounts or notes
receivable sold by such Person, (ii) any liability of such Person under any sale
and leaseback transactions that do not create a liability on the balance sheet
of such Person, (iii) any Synthetic Lease Obligation, and (iv) any obligation
arising with respect to any other transaction which is the functional equivalent
of or takes the place of borrowing but which does not constitute a liability on
the balance sheet of such Person.

 

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“OSHA” shall mean the Occupational Safety and Health Act of 1970, as amended and
in effect from time to time, and any successor statute thereto.

 

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

 

“Other Taxes” shall mean all present or future stamp, court or documentary,
intangible, recording, filing or similar Taxes that arise from any payment made
under, from the execution, delivery, performance, enforcement or registration
of, from the receipt or perfection of a security interest under, or otherwise
with respect to, any Loan Document, except any such Taxes that are Other
Connection Taxes imposed with respect to an assignment (other than an assignment
made pursuant to Section 2.27).

 

“Overadvance” shall have the meaning set forth in Section 2.5.

 

“Parent Company” shall mean, with respect to a Lender, the “bank holding
company” as defined in Regulation Y, if any, of such Lender, and/or any Person
owning, beneficially or of record, directly or indirectly, a majority of the
shares of such Lender.

 

“Participant” shall have the meaning set forth in Section 10.4(d).

 

“Participant Register” shall have the meaning set forth in Section 10.4(d).

 

“Patriot Act” shall mean the USA PATRIOT Improvement and Reauthorization Act of
2005 (Pub. L. 109-177 (signed into law March 9, 2006)), as amended and in effect
from time to time.

 

“Payment Office” shall mean the office of the Administrative Agent located at
303 Peachtree Street, N.E., Atlanta, Georgia 30308, or such other location as to
which the Administrative Agent shall have given written notice to the Borrower
Agent and the other Lenders.

 

“PBGC” shall mean the U.S. Pension Benefit Guaranty Corporation referred to and
defined in ERISA, and any successor entity performing similar functions.

 

“Permitted Acquisition” shall mean any Acquisition by a Loan Party that occurs
when the following conditions have been satisfied:

 

(i)                                     the aggregate consideration payable in
connection with such Acquisition (including cash, equity and Indebtedness or
liabilities incurred or assumed) (A) taken together with the aggregate
consideration for all Permitted Acquisitions consummated in such Fiscal Year,
does not exceed $5,000,000 or (B) taken together with the aggregate
consideration for all Permitted Acquisitions consummated after the Closing Date
and before the date thereof, does not exceed $15,000,000;

 

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(ii)                                  before and immediately after giving effect
to such Acquisition, no Default or Event of Default has occurred and is
continuing or would result therefrom, and all representations and warranties of
each Loan Party set forth in the Loan Documents shall be and remain true and
correct in all material respects, except in the case of any such representation
and warranty that expressly relates to a prior date, in which case such
representation and warranty shall be so true and correct on and as of such prior
date;

 

(iii)                               before and after giving effect to such
Acquisition, Borrower Agent shall have demonstrated by delivering a pro forma
Compliance Certificate signed by a Responsible Officer that (A) Availability is
greater than or equal to $12,500,000 or (B) Availability is greater than or
equal to $10,000,000 and the Fixed Charge Coverage Ratio, on a Pro Forma Basis,
equals or exceeds 1.20 to 1.00;

 

(iv)                              [reserved];

 

(v)                                 the Borrower Agent shall have delivered to
the Administrative Agent (A) at least 30 days before the effective date of such
Acquisition, notice of such Acquisition and historical financial information
with respect to the Person whose stock or assets are being acquired and copies
of the then-current acquisition agreement and related documents; (B) promptly
upon the Administrative Agent’s request from time to time, updated and final
drafts of such acquisition agreements and related documents; (C) promptly upon
the Administrative Agent’s request from time to time, such other information and
reports reasonably requested by the Administrative Agent in connection
therewith;

 

(vi)                              such Acquisition is consensual and, to the
extent required under applicable law or the constitutional documents of the
Person whose stock or assets are being acquired, has been approved by the board
of directors (or the equivalent thereof) of such Person;

 

(vii)                           the Person or assets being acquired is in the
same type of business conducted by the Parent and its Subsidiaries on the date
hereof or any business reasonably related thereto;

 

(viii)                        such Acquisition is consummated in compliance in
all material respects with all Requirements of Law, and all material consents
and approvals from any Governmental Authority or other Person required in
connection with such Acquisition have been obtained;

 

(ix)                              the Person or assets being acquired shall have
positive EBITDA (calculated in a manner substantially similar to “Consolidated
EBITDA” to the extent provisions of such definition are relevant) for the most
recent 12-fiscal-month period ending at least 30 days before the date such
Acquisition is consummated (as determined by reference to financial statements
for the most recently completed fiscal year and the most recent Fiscal Month
ended at least 30 days before the date of consummation of such Acquisition for
which financial statements are available);

 

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(x)                                 before and after giving effect to such
Acquisition and any Indebtedness incurred in connection therewith, Parent and
its Subsidiaries, on a consolidated basis, are Solvent;

 

(xi)                              within the time periods provided in
Section 5.12(a), the Borrower Agent shall have executed and delivered, or caused
its Subsidiaries to execute and deliver, all guarantees, Collateral Documents
and other related documents required under Section 5.12(a); and

 

(xii)                           the Borrower Agent shall have delivered to the
Administrative Agent a certificate executed by a Responsible Officer certifying
that each of the conditions set forth above has been satisfied.

 

“Permitted Discretion” shall mean the Administrative Agent’s determination made
in good faith and in the exercise of commercially reasonable business judgment,
determined in a manner consistent with its credit procedures for asset-based
lending transactions in industries similar to the industries in which the Loan
Parties operate.

 

“Permitted Encumbrances” shall mean:

 

(i)                                     Liens imposed by law for taxes not yet
due or which are being contested in good faith by appropriate proceedings
diligently conducted and with respect to which adequate reserves are being
maintained in accordance with GAAP;

 

(ii)                                  statutory Liens of landlords, carriers,
warehousemen, mechanics, materialmen and other Liens imposed by law in the
ordinary course of business for amounts not yet due or which are being contested
in good faith by appropriate proceedings diligently conducted and with respect
to which adequate reserves are being maintained in accordance with GAAP;

 

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

 

(iv)                              cash pledges or cash deposits to secure the
performance of bids, utilities, contracts (other than contracts for repayment of
Indebtedness), leases, statutory obligations, surety and appeal bonds,
performance bonds and other obligations of a like nature, in each case in the
ordinary course of business;

 

(v)                                 judgment and attachment liens not giving
rise to an Event of Default or Liens created by or existing from any litigation
or legal proceeding that are currently being contested in good faith by
appropriate proceedings diligently conducted and with respect to which adequate
reserves are being maintained in accordance with GAAP;

 

(vi)                              customary rights of set-off, revocation,
refund or chargeback under deposit agreements or under the Uniform Commercial
Code or common law of banks or other financial institutions where the Borrower
or any of its Subsidiaries maintains

 

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deposits (other than deposits intended as cash collateral) in the ordinary
course of business;

 

(vii)                           easements, zoning restrictions, rights-of-way
and similar encumbrances on real property imposed by law or arising in the
ordinary course of business that do not secure any monetary obligations and do
not materially detract from the value of the affected property or materially
interfere with the ordinary conduct of business of the Borrower and its
Subsidiaries taken as a whole;  and

 

(viii)                        any interest or title of a lessor under, and Liens
arising from, precautionary Uniform Commercial Code financing statements solely
evidencing such lessor’s interest under, operating leases;

 

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

 

“Permitted Holders” shall mean (a) Robert B. Barnhill, Jr., (b) each of his
Family Members and Family Trusts, and (c) any corporation, limited liability
company, partnership, or other Person which is an entity, more than 50% of the
voting equity of which is owned and controlled directly or directly by any
Person or Persons described in clauses (a) and (b).

 

“Permitted Investments” shall mean:

 

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

 

(ii)                                  commercial paper having a rating, at the
time of acquisition thereof, of not lower than A-1 by S&P or P-1 by Moody’s and
in either case maturing within six months from the date of acquisition thereof;

 

(iii)                               certificates of deposit, bankers’
acceptances and time deposits maturing within one year of the date of
acquisition thereof issued or guaranteed by or placed with, and money market
deposit accounts issued or offered by, any domestic office of any commercial
bank organized under the laws of the United States or any state thereof which
has a combined capital and surplus and undivided profits of not less than
$500,000,000;

 

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

 

(v)                                 mutual funds investing solely in any one or
more of the Permitted Investments described in clauses (i) through (iv) above or
rated at least A by S&P or at least A by Moody’s.

 

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“Permitted Liens” shall have the meaning given such term in Section 7.2.

 

“Permitted Refinancing Indebtedness” shall mean, in respect of any Indebtedness,
any refinancing, renewal, extension or replacement of such Indebtedness (the
“Refinanced Indebtedness”) which:

 

(i)                                     has a principal amount which does not
exceed the then-outstanding principal amount of the Refinanced Indebtedness
immediately before such refinancing, renewal, extension or replacement (other
than by the amount of any premiums and accrued and unpaid interest with respect
to the Indebtedness being refinanced and reasonable fees and expenses relating
to such refinancing, renewal or replacement financing);

 

(ii)                               has an average weighted life to maturity
which is equal to or longer than the average weighted life to maturity of the
Refinanced Indebtedness (determined as of the date of such refinancing, renewal,
or replacement);

 

(iii)                               if the Refinanced Indebtedness was
Subordinated Debt, is subordinated in right of payment to the Obligations to the
same or greater extent as was the Refinanced Indebtedness pursuant to
subordination terms and conditions which are substantively the same as those
relating to the Refinanced Indebtedness or otherwise on terms reasonably
acceptable to Administrative Agent;

 

(iv)                              has no Person obligated in respect thereof
(whether as a borrower, co-borrower, guarantor, grantor, obligor, or otherwise),
other than Persons obligated in respect of the Refinanced Indebtedness; and

 

(v)                                 is subject to or governed by terms or
conditions which, taken together, are not materially more restrictive or
burdensome to any Loan Party or Subsidiary than those governing the Refinanced
Indebtedness and could not reasonably be expected to be materially adverse to
the interests of any Loan Party, any Subsidiary, the Administrative Agent or the
Lenders.

 

“Person” shall mean any individual, partnership, firm, corporation, association,
joint venture, limited liability company, trust or other entity, or any
Governmental Authority.

 

“Plan” shall mean any “employee pension benefit plan” as defined in
Section 3(2) of ERISA that is subject to Title IV of ERISA (other than a
Multiemployer Plan) maintained or contributed to by the Parent, and of its
Subsidiaries, or any ERISA Affiliate or to which the Parent, and of its
Subsidiaries, or any ERISA Affiliate has or may have an obligation to
contribute, and each such plan for the five-year period immediately following
the latest date on which the Parent, and of its Subsidiaries, or any ERISA
Affiliate maintained, contributed to or had an obligation to contribute to (or
is deemed under Section 4069 of ERISA to have maintained or contributed to or to
have had an obligation to contribute to, or otherwise to have liability with
respect to) such Plan.

 

“Pricing Grid” shall have the meaning set forth in the definition of “Applicable
Margin.”

 

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“Pro Forma Basis” shall mean, in determining the satisfaction or compliance with
any condition or covenant in connection with any Acquisition, Restricted
Payment, Investment, prepayment of Indebtedness, or other transaction described
herein, where applicable, that such event or transaction shall be deemed to have
occurred on the first day of the twelve Fiscal Month period most recently ended
before the effective date of such event or transaction for which financial
statements have been delivered pursuant to Section 5.1(a) or (c), as applicable,
and given effect on such date (in a manner and to the extent acceptable to
Administrative Agent in its Permitted Discretion).

 

“Pro Rata Share” shall mean, with respect to any Lender at any time, a
percentage, the numerator of which shall be such Lender’s Revolving Commitment
(or, if such Commitment has been terminated or expired or the Loans have been
declared to be due and payable, such Lender’s Revolving Credit Exposure), and
the denominator of which shall be the sum of all Revolving Commitments of all
Lenders (or, if such Revolving Commitments have been terminated or expired or
the Loans have been declared to be due and payable, the Aggregate Revolving
Credit Exposure).

 

“Public Lender” shall mean any Lender who does not wish to receive Non-Public
Information and who may be engaged in investment and other market related
activities with respect to Parent and its Subsidiaries, its Affiliates, or any
of their securities or loans.

 

“Real Estate” shall mean all real property owned or leased by the Parent and its
Subsidiaries.

 

“Recipient” shall mean, as applicable, (a) the Administrative Agent, (b) any
Lender and (c) the Issuing Bank.

 

“Regulation D” shall mean Regulation D of the Board of Governors of the Federal
Reserve System, as the same may be in effect from time to time, and any
successor regulations.

 

“Regulation T” shall mean Regulation T of the Board of Governors of the Federal
Reserve System, as the same may be in effect from time to time, and any
successor regulations.

 

“Regulation U” shall mean Regulation U of the Board of Governors of the Federal
Reserve System, as the same may be in effect from time to time, and any
successor regulations.

 

“Regulation X” shall mean Regulation X of the Board of Governors of the Federal
Reserve System, as the same may be in effect from time to time, and any
successor regulations.

 

“Regulation Y” shall mean Regulation Y of the Board of Governors of the Federal
Reserve System, as the same may be in effect from time to time, and any
successor regulations.

 

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“Related Parties” shall mean, with respect to any specified Person, such
Person’s Affiliates and the respective managers, administrators, trustees,
partners, directors, officers, employees, agents, advisors or other
representatives of such Person and such Person’s Affiliates.

 

“Release” shall mean any release, spill, emission, leaking, dumping, injection,
pouring, deposit, disposal, discharge, dispersal, leaching or migration into the
environment (including ambient air, surface water, groundwater, land surface or
subsurface strata) or within any building, structure, facility or fixture.

 

“Rent Reserve” shall mean, with respect to any leased real property an amount
equal to one month’s rental expense for such leased real property (or such other
amount as the Administrative Agent may deem appropriate in its Permitted
Discretion based on the existence of any statutory Lien); provided, however,
that the Administrative Agent shall not implement a Rent Reserve with respect to
any location which is subject to a Collateral Access Agreement.

 

“Required Lenders” shall mean, (a) at any time there are two or fewer Lenders,
all Lenders (other than Defaulting Lenders) and (b) at all other times, Lenders
holding more than 50% of the Aggregate Revolving Commitments at such time or, if
the Lenders have no Commitments outstanding, then Lenders holding more than 50%
of the aggregate outstanding Revolving Credit Exposure of the Lenders at such
time; provided that to the extent that any Lender is a Defaulting Lender, such
Defaulting Lender and all of its Revolving Commitments, Revolving Credit
Exposure shall be excluded for purposes of determining Required Lenders.

 

“Requirement of Law” for any Person shall mean the articles or certificate of
incorporation, bylaws, partnership certificate and partnership agreement, or
limited liability company certificate of organization and limited liability
company agreement, as the case may be, and other organizational and governing
documents of such Person, and any law, treaty, rule or regulation, or
determination of a Governmental Authority, in each case applicable to or binding
upon such Person or any of its property or to which such Person or any of its
property is subject.

 

“Reserves” shall mean reserves that the Administrative Agent may establish from
time to time in its Permitted Discretion for such purposes as the Administrative
Agent shall deem necessary or appropriate.  Without limiting the generality of
the foregoing, the following reserves (without duplication) shall be deemed an
exercise of the Administrative Agent’s Permitted Discretion: (i) reserves for
accrued but unpaid ad valorem, excise and personal property tax liability;
(ii) Bank Product Reserves and reserves in respect of Hedging Obligations
arising from Hedging Transactions with any Lender-Related Hedge Provider;
(iii) reserves for warehousemen’s, bailees’, shippers’, brokers’ or carriers’
charges; (iv) Rent Reserves; (v) reserves for any other matter that has a
negative impact on the value of the Collateral; and (vi) the Dilution Reserve.

 

“Responsible Officer” shall mean (a) with respect to certifying compliance with
the financial covenants set forth in Article VI, the chief financial officer or
the treasurer of the Parent and (b) with respect to all other provisions, any of
the president, the chief executive officer, the chief operating officer, the
chief financial officer, the treasurer, any vice president, or manager (in the
case of a manager-managed limited liability company) of any Loan Party or such
other representative of such Loan Party as may be designated in writing by any
one of the foregoing with the consent of the Administrative Agent.

 

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“Restricted Payment” shall mean, for any Person, any dividend or distribution on
any class of its Capital Stock, or any payment on account of, or set apart
assets for a sinking or other analogous fund for, the purchase, redemption,
retirement, defeasance or other acquisition of any shares of its Capital Stock
or Subordinated Debt or any Guarantee thereof or any options, warrants or other
rights to purchase such Capital Stock or such Subordinated Debt, whether now or
hereafter outstanding, or any management or similar fees.

 

“Revolving Commitment” shall mean, with respect to each Lender, the commitment
of such Lender to make Revolving Loans to the Borrowers and to acquire
participations in Letters of Credit, Swingline Loans, and Agent Advances in an
aggregate principal amount not exceeding the amount set forth with respect to
such Lender on Schedule I, as such schedule may be amended pursuant to
Section 2.25, or, in the case of a Person becoming a Lender after the Closing
Date, the amount of the assigned “Revolving Commitment” as provided in the
Assignment and Acceptance executed by such Person as an assignee, or the joinder
executed by such Person, in each case as such commitment may subsequently be
increased or decreased pursuant to the terms hereof.

 

“Revolving Commitment Termination Date” shall mean the earliest of (i) June 24,
2021, (ii) the date on which the Revolving Commitments are terminated pursuant
to Section 2.10 and (iii) the date on which all amounts outstanding under this
Agreement have been declared or have automatically become due and payable
(whether by acceleration or otherwise).

 

“Revolving Credit Exposure” shall mean, with respect to any Lender at any time,
the sum of the outstanding principal amount of such Lender’s Revolving Loans, LC
Exposure Swingline Exposure, and Agent Advance Exposure.

 

“Revolving Loan” shall mean a loan made by a Lender (other than the Swingline
Lender) to the Borrowers under its Revolving Commitment.

 

“S&P” shall mean Standard & Poor’s, a division of The McGraw-Hill
Companies, Inc.

 

“Sanctioned Country” shall mean, at any time, a country or territory that is, or
whose government is, the subject of any comprehensive, country-based Sanctions.

 

“Sanctioned Person” shall mean, at any time, (a) any Person listed in any
Sanctions-related list of designated Persons maintained by OFAC, the U.S.
Department of State, the United Nations Security Council, the European Union or
any EU member state or any other applicable sanctions authority, (b) any Person
operating, organized or resident in a Sanctioned Country or (c) any Person
controlled by any such Person.

 

“Sanctions” shall mean economic or financial sanctions or trade embargoes
administered or enforced from time to time by (a) the U.S. government, including
those administered by OFAC or the U.S. Department of State or (b) the United
Nations Security Council, the European Union or Her Majesty’s Treasury of the
United Kingdom.

 

“Secured Parties” shall mean the Administrative Agent, the Lenders, the Issuing
Bank, the Lender-Related Hedge Providers and the Bank Product Providers.

 

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“Sole Lead Arranger” shall mean SunTrust Robinson Humphrey, Inc., in its
capacity as sole lead arranger in connection with this Agreement.

 

“Solvent” shall mean, with respect to any Person on a particular date, that on
such date (a) the fair value of the property of such Person is greater than the
total amount of liabilities, including subordinated and contingent liabilities,
of such Person; (b) the present fair saleable value of the assets of such Person
is not less than the amount that will be required to pay the probable liability
of such Person on its debts and liabilities, including subordinated and
contingent liabilities as they become absolute and matured; (c) such Person does
not intend to, and does not believe that it will, incur debts or liabilities
beyond such Person’s ability to pay as such debts and liabilities mature; and
(d) such Person is not engaged in a business or transaction, and is not about to
engage in a business or transaction, for which such Person’s property would
constitute an unreasonably small capital.  The amount of contingent liabilities
(such as litigation, guaranties and pension plan liabilities) at any time shall
be computed as the amount that, in light of all the facts and circumstances
existing at the time, represents the amount that would reasonably be expected to
become an actual or matured liability.

 

“Specified Default” shall mean any Default or Event of Default of the type
described in Sections 8.1(a), (b), (d) (to the extent arising because of any
Loan Party’s failure to comply with the provisions of Section 5.1(j) or
Article VI), (h), (i), or (j).

 

“Spot Rate” shall mean, for any currency, the rate reasonably determined by the
Administrative Agent to be the rate quoted by SunTrust Bank (or any other Person
from time to time designated by SunTrust Bank by notice to Borrower Agent) as
the spot rate for the purchase by SunTrust (or such other designated Person) of
such currency with another currency through its principal foreign exchange
trading office at approximately 11:00 A.M. (New York City time) on the date two
Business Days before the date as of which the foreign exchange computation is
made.

 

“Subordinated Debt” shall mean any Indebtedness of any Loan Party which is
subordinated in right of payment to the Obligations on terms which are
acceptable to Administrative Agent in its discretion.

 

“Subsidiary” shall mean, with respect to any Person (the “parent”) at any date,
any corporation, partnership, joint venture, limited liability company,
association or other entity the accounts of which would be consolidated with
those of the parent in the parent’s consolidated financial statements if such
financial statements were prepared in accordance with GAAP as of such date, as
well as any other corporation, partnership, joint venture, limited liability
company, association or other entity (i) of which securities or other ownership
interests representing more than 50% of the equity or more than 50% of the
ordinary voting power or, in the case of a partnership, more than 50% of the
general partnership interests are, as of such date, owned, controlled or held,
or (ii) that is, as of such date, otherwise controlled, by the parent or one or
more subsidiaries of the parent or by the parent and one or more subsidiaries of
the parent.  Unless otherwise indicated, all references to “Subsidiary”
hereunder shall mean a Subsidiary of the Parent.  Any of the foregoing to the
contrary notwithstanding, National Air Time shall not constitute a Subsidiary.

 

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“Subsidiary Loan Party” shall mean any Subsidiary (other than the Borrowers)
that executes or becomes a party to the Guaranty and Security Agreement.

 

“Supermajority Lenders” shall mean, (a) at any time there are two or fewer
Lenders, all Lenders (other than Defaulting Lenders) and (b) at all other times,
Lenders holding more than 66.67% of the Aggregate Revolving Commitments at such
time or, if the Lenders have no Commitments outstanding, then Lenders holding
more than 66.67% of the aggregate outstanding Revolving Credit Exposure of the
Lenders at such time; provided that to the extent that any Lender is a
Defaulting Lender, such Defaulting Lender and all of its Revolving Commitments
and Revolving Credit Exposure shall be excluded for purposes of
determining Supermajority Lenders.

 

“Swap Obligation” shall mean, with respect to any Guarantor, any obligation to
pay or perform under any agreement, contract or transaction that constitutes a
“swap” within the meaning of section 1a(47) of the Commodity Exchange Act.

 

“Swingline Commitment” shall mean the commitment of the Swingline Lender to make
Swingline Loans in an aggregate principal amount at any time outstanding not to
exceed $10,000,000.

 

“Swingline Exposure” shall mean, with respect to each Lender, the principal
amount of the Swingline Loans in which such Lender is legally obligated either
to make a Loan or to purchase a participation in accordance with Section 2.4,
which shall equal such Lender’s Pro Rata Share of all outstanding Swingline
Loans.

 

“Swingline Lender” shall mean SunTrust Bank.

 

“Swingline Loan” shall mean a loan made to the Borrowers by the Swingline Lender
under the Swingline Commitment.

 

“Synthetic Lease” shall mean a lease transaction under which the parties intend
that (i) the lease will be treated as an “operating lease” by the lessee
pursuant to Accounting Standards Codification Sections 840-10 and 840-20, as
amended, and (ii) the lessee will be entitled to various tax and other benefits
ordinarily available to owners (as opposed to lessees) of like property.

 

“Synthetic Lease Obligations” shall mean, with respect to any Person, the sum of
(i) all remaining rental obligations of such Person as lessee under Synthetic
Leases which are attributable to principal and, without duplication, (ii) all
rental and purchase price payment obligations of such Person under such
Synthetic Leases assuming such Person exercises the option to purchase the lease
property at the end of the lease term.

 

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

 

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“Trading with the Enemy Act” shall mean the Trading with the Enemy Act of the
United States of America (50 U.S.C. App. §§ 1 et seq.), as amended and in effect
from time to time.

 

“Unfinanced Cash Capital Expenditures” shall mean, for any period, the amount of
Capital Expenditures made by the Parent or any of its Subsidiaries during such
period in cash, but excluding any such Capital Expenditures financed with
Indebtedness permitted under Section 7.1(c) or that constitute reinvestment of
proceeds as permitted under Section 2.14(a).

 

“Unfunded Pension Liability” of any Plan shall mean the amount, if any, by which
the value of the accumulated plan benefits under the Plan, determined on a plan
termination basis in accordance with actuarial assumptions at such time
consistent with those prescribed by the PBGC for purposes of Section 4044 of
ERISA, exceeds the fair market value of all Plan assets allocable to such
liabilities under Title IV of ERISA (excluding any accrued but unpaid
contributions).

 

“Uniform Commercial Code” or “UCC” shall mean the Uniform Commercial Code as
amended and in effect from time to time in the State of New York.

 

“United States” or “U.S.” shall mean the United States of America.

 

“U.S. Borrower” shall mean any Borrower that is a U.S. Person.

 

“U.S. Person” shall mean any Person that is a “United States person” as defined
in Section 7701(a)(30) of the Code.

 

“U.S. Tax Compliance Certificate” shall have the meaning set forth in
Section 2.22(g)(ii).

 

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

 

“Withholding Agent” shall mean the Borrowers, any other Loan Party or the
Administrative Agent, as applicable.

 

“Write-Down and Conversion Powers” shall mean, with respect to any EEA
Resolution Authority, the write-down and conversion powers of such EEA
Resolution Authority from time to time under the Bail-In Legislation for the
applicable EEA Member Country, which write-down and conversion powers are
described in the EU Bail-In Legislation Schedule.

 

Section 1.2.                                [Reserved.]

 

Section 1.3.                                Accounting Terms and Determination. 
Except as may be otherwise expressly provided herein, all terms of an accounting
or financial nature shall be construed in accordance with GAAP, as in effect
from time to time; provided that, if after the Closing Date there occurs any
change in GAAP or in the application thereof on the operation of any provision
hereof and the Borrower Agent notifies the Administrative Agent that the Loan
Parties request an amendment to any provision hereof to eliminate the effect of
such change in GAAP or in the

 

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application thereof (or if the Administrative Agent notifies the Borrower Agent
that the Required Lenders request an amendment to any provision hereof for such
purpose), regardless of whether any such notice is given before or after such
change in GAAP or in the application thereof, then such provision shall be
interpreted on the basis of GAAP as in effect and applied immediately before
such change shall have become effective until such notice shall have been
withdrawn or such provision amended in accordance herewith.  Notwithstanding any
other provision contained herein, (i) all terms of an accounting or financial
nature used herein shall be construed, and all computations of amounts and
ratios referred to herein shall be made (a) without giving effect to any
election under Accounting Standards Codification 825-10-25 (or any other
Accounting Standards Codification or Financial Accounting Standard having a
similar result or effect) to value any Indebtedness or other liabilities of
Parent or any Subsidiary at “fair value”, as defined therein and (b) without
giving effect to any treatment of Indebtedness in respect of convertible debt
instruments under Accounting Standards Codification 470-20 (or any other
Accounting Standards Codification or Financial Accounting Standard having a
similar result or effect) to value any such Indebtedness in a reduced or
bifurcated manner as described therein, and such Indebtedness shall at all times
be valued at the full stated principal amount thereof and (ii) any obligations
relating to a lease that was accounted for by such Person as an operating lease
as of the Closing Date and any similar lease entered into after the Closing Date
by such Person (or any Subsidiary or Affiliate of such Person) shall be
accounted for by such Person as an operating lease and not as Capital Lease
Obligations.

 

Section 1.4.                                Terms Generally.  The definitions of
terms herein shall apply equally to the singular and plural forms of the terms
defined.  Whenever the context may require, any pronoun shall include the
corresponding masculine, feminine and neuter forms.  The words “include,”
“includes” and “including” shall be deemed to be followed by the phrase “without
limitation.”  The word “will” shall be construed to have the same meaning and
effect as the word “shall.”  In the computation of periods of time from a
specified date to a later specified date, the word “from” means “from and
including” and the word “to” means “to but excluding.”  Unless the context
requires otherwise (i) any definition of or reference to any agreement,
instrument or other document herein shall be construed as referring to such
agreement, instrument or other document as it was originally executed or as it
may from time to time be amended, restated, supplemented or otherwise modified
(subject to any restrictions on such amendments, supplements or modifications
set forth herein), (ii) any reference herein to any Person shall be construed to
include such Person’s successors and permitted assigns, (iii) the words
“hereof,” “herein” and “hereunder” and words of similar import shall be
construed to refer to this Agreement as a whole and not to any particular
provision hereof, (iv) all references to Articles, Sections, Exhibits and
Schedules shall be construed to refer to Articles, Sections, Exhibits and
Schedules to this Agreement and (v) all references to a specific time shall be
construed to refer to the time in the city and state of the Administrative
Agent’s principal office, unless otherwise indicated.

 

ARTICLE II

 

AMOUNT AND TERMS OF THE COMMITMENTS

 

Section 2.1.                                General Description of Facilities. 
Subject to and upon the terms and conditions herein set forth, (a) the Lenders
hereby establish in favor of the Borrowers a revolving

 

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credit facility pursuant to which each Lender severally agrees (to the extent of
such Lender’s Revolving Commitment) to make Revolving Loans to the Borrowers in
accordance with Section 2.2; (b) the Issuing Bank agrees to issue Letters of
Credit in accordance with Section 2.24; (c) the Swingline Lender may make
Swingline Loans in accordance with Section 2.4; (d) the Administrative Agent may
make Agent Advances in accordance with Section 2.6; and (e) each Lender agrees
to purchase a participation interest in the Letters of Credit, the Swingline
Loans, and the Agent Advances pursuant to the terms and conditions hereof;
provided that in no event shall the Aggregate Revolving Credit Exposure exceed
the lesser of (i) the Borrowing Base and (ii) the Aggregate Revolving Commitment
Amount.

 

Section 2.2.                                Revolving Loans.  Subject to the
terms and conditions set forth herein, each Lender severally agrees to make
Revolving Loans, ratably in proportion to its Pro Rata Share of the Aggregate
Revolving Commitments, to the Borrowers, from time to time during the
Availability Period, in an aggregate principal amount outstanding at any time
that will not result in (a) such Lender’s Revolving Credit Exposure exceeding
such Lender’s Revolving Commitment or (b) the Aggregate Revolving Credit
Exposure exceeding the lesser of (i) the Borrowing Base and (ii) the Aggregate
Revolving Commitment.  During the Availability Period, the Borrowers shall be
entitled to borrow, prepay and reborrow Revolving Loans in accordance with the
terms and conditions of this Agreement.

 

Section 2.3.                                Procedure for Revolving Borrowings. 
The Borrower Agent shall give the Administrative Agent written notice (or
telephonic notice promptly confirmed in writing) of each requested Revolving
Borrowing, substantially in the form of Exhibit 2.3 attached hereto (a “Notice
of Revolving Borrowing”), before 11:00 a.m. one Business Day before the
requested date of such Revolving Borrowing.  Each Notice of Revolving Borrowing
shall be irrevocable and shall specify (i) the aggregate principal amount of
such Revolving Borrowing and (ii) the date of such Revolving Borrowing (which
shall be a Business Day).  The aggregate principal amount of each Revolving
Borrowing shall not be less than $1,000,000 or a larger multiple of $100,000,
provided that Loans made pursuant to Sections 2.4, 2.5, 2.6, or 2.24 (d) may be
made in lesser amounts as provided therein.  Promptly following the receipt of a
Notice of Revolving Borrowing in accordance herewith, the Administrative Agent
shall advise each Lender of the details thereof and the amount of such Lender’s
Revolving Loan to be made as part of the requested Revolving Borrowing.

 

Section 2.4.                                Swingline Commitment.

 

(a)                                 Subject to the terms and conditions set
forth herein, the Swingline Lender shall make Swingline Loans to the Borrowers
from time to time during the Availability Period, so long as, after giving
effect thereto, (i) the Aggregate Revolving Credit Exposure will not exceed the
lesser of (A) the Borrowing Base and (B) the Aggregate Revolving Commitment
Amount and (ii) the aggregate principal amount of the Swingline Loans will not
exceed the Swingline Commitment; provided that the Swingline Lender shall not be
required to make a Swingline Loan to refinance an outstanding Swingline Loan. 
The Borrowers shall be entitled to borrow, repay and reborrow Swingline Loans in
accordance with the terms and conditions of this Agreement.

 

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(b)                                 Except for Swingline Loans made pursuant to
Section 2.4(f), the Borrower Agent shall give the Administrative Agent written
notice (or telephonic notice promptly confirmed in writing) of each Swingline
Borrowing, substantially in the form of Exhibit 2.4 attached hereto (a “Notice
of Swingline Borrowing”), before 10:00 a.m. on the requested date of each
Swingline Borrowing.  Each Notice of Swingline Borrowing shall be irrevocable
and shall specify (i) the principal amount of such Swingline Borrowing, (ii) the
date of such Swingline Borrowing (which shall be a Business Day) and (iii) the
account of the Borrowers to which the proceeds of such Swingline Borrowing
should be credited.  The Administrative Agent will promptly advise the Swingline
Lender of each Notice of Swingline Borrowing.  Except as provided in
Section 2.4(f), the aggregate principal amount of each Swingline Loan shall not
be less than $100,000 or a larger multiple of $50,000, or such other minimum
amounts agreed to by the Swingline Lender and the Borrowers.  Except with
respect to Swingline Loans made pursuant to Section 2.4(f), the Swingline Lender
will make the proceeds of each Swingline Loan available to the Borrowers in
Dollars in immediately available funds in or for credit to the Master Funding
Account or the Controlled Disbursement Account not later than 1:00 p.m. on the
requested date of such Swingline Borrowing or otherwise in accordance with such
other written instructions which may be provided by the Borrower Agent to the
Administrative Agent from time to time and which are acceptable to
Administrative Agent.

 

(c)                                  The Swingline Lender, at any time and from
time to time in its sole discretion, may, but in no event no less frequently
than once each calendar week shall, on behalf of the Borrowers (which hereby
irrevocably authorize and direct the Swingline Lender to act on their behalf),
give a Notice of Revolving Borrowing to the Administrative Agent requesting the
Lenders (including the Swingline Lender) to make Revolving Loans in an amount
equal to the unpaid principal amount of any Swingline Loan.  Each Lender will
make the proceeds of its Revolving Loan included in such Borrowing available to
the Administrative Agent for the account of the Swingline Lender in accordance
with Section 2.8, which will be used solely for the repayment of such Swingline
Loan.

 

(d)                                 If for any reason a Revolving Borrowing may
not be (as determined in the sole discretion of the Administrative Agent), or is
not, made in accordance with the foregoing provisions, then each Lender (other
than the Swingline Lender) shall purchase an undivided participating interest in
such Swingline Loan in an amount equal to its Pro Rata Share thereof on the date
that such Revolving Borrowing should have occurred.  On the date of such
required purchase, each Lender shall promptly transfer, in immediately available
funds, the amount of its participating interest to the Administrative Agent for
the account of the Swingline Lender.

 

(e)                                  Each Lender’s obligation to make a Loan
pursuant to subsection (c) of this Section or to purchase participating
interests pursuant to subsection (d) of this Section shall be absolute and
unconditional and shall not be affected by any circumstance, including, without
limitation, (i) any set-off, counterclaim, recoupment, defense or other right
that such Lender or any other Person may have or claim against the Swingline
Lender, the Borrowers or any other Person for any reason whatsoever, (ii) the
existence of a Default or an Event of Default or the termination of any Lender’s
Revolving Commitment, (iii) the existence (or alleged existence) of any event or
condition which has had or could reasonably be expected to have a Material
Adverse Effect, (iv) any breach of this Agreement or any other Loan Document by
any Loan Party, the Administrative Agent or any Lender or (v) any other
circumstance, happening or event

 

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whatsoever, whether or not similar to any of the foregoing.  If such amount is
not in fact made available to the Swingline Lender by any Lender, the Swingline
Lender shall be entitled to recover such amount on demand from such Lender,
together with accrued interest thereon for each day from the date of demand
thereof (A) at the Federal Funds Rate until the second Business Day after such
demand and (B) at the Applicable Rate at all times thereafter.  Until such time
as such Lender makes its required payment, the Swingline Lender shall be deemed
to continue to have outstanding Swingline Loans in the amount of the unpaid
participation for all purposes of the Loan Documents.  In addition, such Lender
shall be deemed to have assigned any and all payments made of principal and
interest on its Loans and any other amounts due to it hereunder to the Swingline
Lender to fund the amount of such Lender’s participation interest in such
Swingline Loans that such Lender failed to fund pursuant to this Section, until
such amount has been purchased in full.

 

(f)                                   Unless payment is otherwise timely made by
the Borrowers, the becoming due of any amount required to be paid under this
Agreement or any of the other Loan Documents as principal, interest,
reimbursement obligations in connection with Letters of Credit, premiums, fees,
reimbursable expenses or other sums payable hereunder shall be deemed
irrevocably to be the Borrower Agent’s request for a Swingline Loan (without any
requirement for the submission of a Notice of Swingline Borrowing) to be made on
the due date of, and in an aggregate amount required to pay, such principal,
interest, reimbursement obligations in connection with Letters of Credit,
premiums, fees, reimbursable expenses or other sums payable hereunder, and the
proceeds of a Swingline Loan made pursuant to such request may be disbursed by
way of direct payment of the relevant Obligations.  The presentation for payment
of any check or other item of payment drawn on the Controlled Disbursement
Account at a time when there are insufficient funds in the Controlled
Disbursement Account or Master Funding Account to cover such check or other item
of payment shall be deemed irrevocably to be a request (without any requirement
for the submission of a Notice of Swingline Borrowing or a minimum principal
amount) for a Swingline Loan on the date of such presentation and in an amount
equal to the aggregate amount of the checks or other items presented for
payment, and the proceeds of any Swingline Loan made in such circumstances may
be disbursed to the Controlled Disbursement Account or Master Funding Account,
and, subject to the satisfaction of all applicable conditions precedent set
forth in Article III (as to any Swingline made on the Closing Date) and
Section 3.2, Swingline Lender shall make such Swingline Loan.  As among the
Swingline Lender, on the one hand, and all other Secured Parties, on the other
hand, until such time as the Required Lenders have provided written notice to
the Administrative Agent and the Swingline Lender to the contrary, the Swingline
Lender may make Swingline Loans under this Section 2.4(f) in its sole and
absolute discretion and without regard to the existence of, and without being
deemed to have waived, any Default or Event of Default and without regard to any
Borrower’s failure to satisfy any of the conditions set forth in Section 3.2. 
Swingline Lender may, in its sole and absolute discretion, make Swingline Loans
under this Section 2.4(f) if an Overadvance exists or would result therefrom, in
each case, subject to the terms of Section 2.5.  As between the Swingline
Lender, on the one hand, and the Secured Parties, on the other hand, the
Swingline Lender shall not have any obligation to honor any deemed request for a
Swingline Loan under this Section 2.4(f).  No further authorization, direction
or approval by any Borrower shall be required to be given by such Borrower for
any deemed request for a Swingline Loan under this Section 2.4(f).

 

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Section 2.5.                                Overadvances; Optional
Overadvances.   If at any time the amount of the Aggregate Revolving Credit
Exposure exceeds the lesser of (a) the Borrowing Base and (b) the Aggregate
Revolving Commitment Amount, or any other applicable limitation set forth in
this Agreement (including, without limitation, the limitations on Swingline
Loans, Agent Advances and Letters of Credit) such excess (an “Overadvance”)
shall nevertheless constitute a portion of the Obligations that are secured by
the Collateral and are entitled to all benefits thereof.  No Borrower shall have
any right whatsoever to (i) receive any Revolving Loan, (ii) receive any
Swingline Loan, or (iii) request the issuance of any Letter of Credit if, before
or immediately after giving effect thereto, there shall exist a Default or Event
of Default.  If (A) the Lenders shall make any Revolving Loans, (B) the
Swingline Lender shall make any Swingline Loan, (C) the Administrative Agent
shall make any Agent Advances, or (D) the Issuing Bank shall agree to the
issuance of any Letter of Credit, which in any such case gives rise to an
Overadvance, the Borrowers shall make, on demand, a payment on the Obligations
to be applied to the Revolving Loans, the Swingline Loans, and the Agent
Advances, as appropriate, in an aggregate principal amount equal to such
Overadvance and, if such Overadvance continues to exist, Cash Collateralize LC
Exposure.  Notwithstanding the foregoing or any other contrary provision of this
Agreement, the Lenders hereby authorize the Swingline Bank at the direction of
the Administrative Agent in the Administrative Agent’s Permitted Discretion, and
Swingline Bank shall at the direction of the Administrative Agent, knowingly and
intentionally, continue to make Swingline Loans to the Borrowers,
notwithstanding that an Overadvance exists or thereby would be created, in an
aggregate amount outstanding at any time not to exceed $5,000,000, so long as
(1) after giving effect to such Swingline Loans, the outstanding Aggregate
Revolving Credit Exposure does not exceed the Aggregate Revolving Commitment
Amount and (2) at the time of the making of any such Swingline Loans, the
Administrative Agent does not believe, in good faith, that the Overadvance
created by such Swingline Loans will be outstanding for more than 90 days.  The
foregoing sentence is for the exclusive benefit of the Administrative Agent, the
Swingline Bank, and the Lenders and is not intended to benefit any Borrower in
any way.  The Required Lenders may at any time revoke the Administrative Agent’s
authority to direct the Swingline Bank to make Overadvances pursuant to the
preceding sentence of this Section 2.5.  Any such revocation must be in writing
and shall become effective prospectively upon the Administrative Agent’s receipt
thereof.

 

Section 2.6.                                Agent Advances.

 

(a)                                 Subject to the limitations set forth below
and notwithstanding anything else in this Agreement to the contrary, the
Administrative Agent is authorized by the Borrowers and the Lenders, from time
to time in the Administrative Agent’s sole discretion, (i) at any time that a
Default or Event of Default exists, (ii) at any time that any of the other
conditions precedent set forth in Section 3.2  (to the extent applicable) have
not been satisfied, or (iii) at any time an Overadvance exists or would result
from any Agent Advance (as defined below), to make Loans to the Borrowers on
behalf of the Lenders in an aggregate amount outstanding at any time not to
exceed $5,000,000, which the Administrative Agent, in its Permitted Discretion,
deems necessary or desirable (A) to preserve or protect the Collateral, or any
portion thereof, (B) to enhance the likelihood of, or maximize the amount of,
repayment of the Loans and other Obligations, or (C) to pay any other amount
chargeable to the Loan Parties pursuant to the terms of this Agreement or any
other Loan Document, including costs, fees and expenses as provided under this
Agreement (any of such advances are herein referred to as “Agent Advances”);

 

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provided, that the Required Lenders may at any time revoke the Administrative
Agent’s authorization to make Agent Advances.  Any such revocation must be in
writing and shall become effective prospectively upon the Administrative Agent’s
receipt thereof.  In no event shall the Aggregate Revolving Credit Exposure,
after giving effect to any Agent Advance, exceed the Aggregate Revolving
Commitment Amount.

 

(b)                                 Agent Advances shall be secured by the
Collateral and shall constitute Obligations hereunder, bear interest at the
Applicable Rate, and be subject to all terms and conditions of this Agreement
and the other Loan Documents applicable to Revolving Loans, except that all
payments thereon shall be made to the Administrative Agent solely for its own
account and the making of any Agent Advance shall not require the consent of any
Borrower.  The Administrative Agent shall have no duty or obligation to make any
Agent Advance hereunder.

 

(c)                                  The Administrative Agent shall notify each
Lender no less frequently than weekly, as determined by the Administrative
Agent, of the principal amount of Agent Advances outstanding as of 12:00 noon
(Atlanta, Georgia, time) as of such date, and each Lender’s Pro Rata Share
thereof.  Each Lender shall before 2:00 p.m. (Atlanta, Georgia, time) on such
Business Day make available to the Administrative Agent, in immediately
available funds, the amount of its Pro Rata Share of such principal amount of
Agent Advances outstanding.  Upon such payment by a Lender, such Lender shall be
deemed to have made a Revolving Loan to the Borrowers, notwithstanding any
failure of the Borrowers to satisfy the conditions in Section 3.2.  The
Administrative Agent shall use such funds to repay the principal amount of Agent
Advances. Additionally, if at any time any Agent Advances are outstanding, any
of the events described in Section 8.1(h) or (i) shall have occurred, then each
Lender shall automatically, upon the occurrence of such event, and without any
action on the part of the Administrative Agent, the Borrowers, or the Lenders,
be deemed to have purchased an undivided participation in the principal and
interest of all Agent Advances then outstanding in an amount equal to such
Lender’s Revolving Commitment and each Lender shall, notwithstanding such Event
of Default, immediately pay to the Administrative Agent in immediately available
funds, the amount of such Lender’s participation (and upon receipt thereof, the
Administrative Agent shall deliver to such Lender, a loan participation
certificate dated the date of receipt of such funds in such amount).  The
disbursement of funds in connection with the settlement of Agent Advances
hereunder shall be subject to the terms and conditions of Section 2.23.

 

Section 2.7.                                Reserved.

 

Section 2.8.                                Funding of Borrowings.

 

(a)                                 Each Lender will make available each Loan to
be made by it hereunder on the proposed date thereof by wire transfer in
immediately available funds by 11:00 a.m. to the Administrative Agent at the
Payment Office; provided that the Swingline Loans will be made as set forth in
Section 2.4 and Agent Advances will be made as set forth in Section 2.6.  The
Administrative Agent will make such Loans available to the Borrowers by promptly
crediting the amounts that it receives, in like funds by the close of business
on such proposed date, to the Master Funding Account or the Controlled
Disbursement Account or in accordance with such

 

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other written instructions which may be provided by the Borrower Agent to the
Administrative Agent from time to time and which are acceptable to the
Administrative Agent.

 

(b)                                 Unless the Administrative Agent shall have
been notified by any Lender before 5:00 p.m. one Business Day before the date of
a Borrowing in which such Lender is to participate that such Lender will not
make available to the Administrative Agent such Lender’s share of such
Borrowing, the Administrative Agent may assume that such Lender has made such
amount available to the Administrative Agent on such date, and the
Administrative Agent, in reliance on such assumption, may make available to the
Borrowers on such date a corresponding amount.  If such corresponding amount is
not in fact made available to the Administrative Agent by such Lender on the
date of such Borrowing, the Administrative Agent shall be entitled to recover
such corresponding amount on demand from such Lender together with interest
(x) at the Federal Funds Rate until the second Business Day after such demand
and (y) at the Applicable Rate at all times thereafter.  If such Lender does not
pay such corresponding amount forthwith upon the Administrative Agent’s demand
therefor, the Administrative Agent shall promptly notify the Borrowers, and the
Borrowers shall immediately pay such corresponding amount to the Administrative
Agent together with interest at the rate specified for such Borrowing.  Nothing
in this subsection shall be deemed to relieve any Lender from its obligation to
fund its Pro Rata Share of any Borrowing hereunder or to prejudice any rights
which any Borrower may have against any Lender as a result of any default by
such Lender hereunder.

 

(c)                                  All Revolving Borrowings shall be made by
the Lenders on the basis of their respective Pro Rata Shares.  No Lender shall
be responsible for any default by any other Lender in its obligations hereunder,
and each Lender shall be obligated to make its Loans provided to be made by it
hereunder, regardless of the failure of any other Lender to make its Loans
hereunder.

 

Section 2.9.                                [Reserved.]

 

Section 2.10.                         Optional Reduction and Termination of
Commitments.

 

(a)                                 Unless previously terminated, all Revolving
Commitments, Swingline Commitments and LC Commitments shall terminate on the
Revolving Commitment Termination Date.

 

(b)                                 Upon at least three Business Days’ prior
written notice (or telephonic notice promptly confirmed in writing) to the
Administrative Agent, the Borrowers may reduce the Aggregate Revolving
Commitments in part or terminate the Aggregate Revolving Commitments in whole;
provided that (i) any partial reduction shall apply to reduce proportionately
and permanently the Revolving Commitment of each Lender, (ii) any partial
reduction pursuant to this Section shall be in an amount of at least $5,000,000
and any larger multiple of $1,000,000, and (iii) no such reduction shall be
permitted which would cause the Aggregate Revolving Credit Exposure to exceed
the lesser of (A) the Aggregate Revolving Commitment Amount (as so reduced) and
(B) the Borrowing Base.  Any such reduction in the Aggregate Revolving
Commitment Amount below the principal amount of the Swingline Commitment and the
LC Commitment shall result in a dollar-for-dollar reduction in the Swingline
Commitment and the LC Commitment. Any notice to reduce the Revolving Commitments
under this Section 2.10 shall be irrevocable; provided that a notice of
termination of the Revolving Commitments in full delivered by the Borrowers may
state that such notice is conditioned upon the effectiveness of

 

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other credit facilities or debt or equity issuances, in which case such notice
may be revoked by the Borrowers (by notice to the Administrative Agent on or
prior to the specified effective date) if such condition is not satisfied.

 

(c)                                  With the written approval of the
Administrative Agent, the Borrowers may terminate (on a non-ratable basis) the
unused amount of the Revolving Commitment of a Defaulting Lender, and in such
event the provisions of Section 2.28 will apply to all amounts thereafter paid
by the Borrowers for the account of any such Defaulting Lender under this
Agreement (whether on account of principal, interest, fees, indemnity or other
amounts); provided that such termination will not be deemed to be a waiver or
release of any claim that the Loan Parties, the Administrative Agent, the
Issuing Bank, the Swingline Lender or any other Lender may have against such
Defaulting Lender.

 

Section 2.11.                         Repayment of Loans.  The outstanding
principal amount of all Revolving Loans, Swingline Loans and Agent Advances
shall be due and payable (together with accrued and unpaid interest thereon) on
the Revolving Commitment Termination Date. Notwithstanding the foregoing,
however, if at any time and for any reason there shall exist an Overadvance, the
Borrowers shall pay to the Administrative Agent, on demand, an amount equal to
the Overadvance, which payment shall constitute a mandatory payment of the
Revolving Loans, Agent Advances, and Swingline Loans.

 

Section 2.12.                         Evidence of Indebtedness.

 

(a)                                 Each Lender shall maintain in accordance
with its usual practice appropriate records evidencing the Indebtedness of the
Borrowers to such Lender resulting from each Loan made by such Lender from time
to time, including the amounts of principal and interest payable thereon and
paid to such Lender from time to time under this Agreement.  The Administrative
Agent shall maintain appropriate records in which shall be recorded (i) the
Revolving Commitment of each Lender, (ii) the amount of each Loan made hereunder
by each Lender, (iii) the date and amount of any principal or interest due and
payable or to become due and payable from the Borrowers to each Lender hereunder
in respect of the Loans and (iv) both the date and amount of any sum received by
the Administrative Agent hereunder from the Borrowers in respect of the Loans
and each Lender’s Pro Rata Share thereof.  The entries made in such records
shall be prima facie evidence of the existence and amounts of the obligations of
the Borrowers therein recorded; provided that the failure or delay of any Lender
or the Administrative Agent in maintaining or making entries into any such
record or any error therein shall not in any manner affect the obligation of the
Borrowers to repay the Loans (both principal and unpaid accrued interest) of
such Lender in accordance with the terms of this Agreement.

 

(b)                                 This Agreement evidences the obligation of
the Borrowers to repay the Loans and is being executed as a “noteless” credit
agreement.  However, at the request of any Lender (including the Swingline
Lender) at any time, each Borrower agrees that it will prepare, execute and
deliver to such Lender a promissory note payable to the order of such Lender
(or, if requested by such Lender or Borrower Agent, to such Lender and its
registered assigns) and in a form approved by the Administrative Agent. 
Thereafter, the Loans evidenced by such promissory note and interest thereon
shall at all times (including after assignment permitted hereunder) be
represented by one or more promissory notes in such form payable to the order of

 

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the payee named therein (or, if such promissory note is a registered note, to
such payee and its registered assigns).

 

Section 2.13.                         Optional Prepayments.

 

(a)                                 Subject to the following clause (b) the
Borrowers shall have the right at any time and from time to time to prepay any
Borrowing, in whole or in part, without premium or penalty, by giving written
notice (or telephonic notice promptly confirmed in writing) to the
Administrative Agent not less than one Business Day before the date of such
prepayment and in the case of any prepayment of any Swingline Borrowing, before
11:00 a.m. on the date of such prepayment.  Each such notice shall be
irrevocable and shall specify the proposed date of such prepayment and the
principal amount of each Borrowing or portion thereof to be prepaid.  Upon
receipt of any such notice, the Administrative Agent shall promptly notify each
affected Lender of the contents thereof and of such Lender’s Pro Rata Share of
any such prepayment.  If such notice is given, the aggregate amount specified in
such notice shall be due and payable on the date designated in such notice,
together with accrued interest to such date on the amount so prepaid in
accordance with Section 2.15.  Each partial prepayment of any Loan (other than
Swingline Loans) shall be in an amount that would be permitted in the case of an
advance of a Revolving Borrowing pursuant to Section 2.3.  Each prepayment of a
Borrowing shall be applied ratably to the Loans comprising such Borrowing.

 

(b)                                 Any of the foregoing clause (a) to the
contrary notwithstanding, Loans may be prepaid in accordance with Section 5.11.

 

Section 2.14.                         Mandatory Prepayments.

 

(a)                                 Within one Business Day after receipt during
a Cash Dominion Period by the Parent or any of its Subsidiaries of any proceeds
of any sale or disposition by the Parent or any of its Subsidiaries of any of
its assets, or any proceeds from any casualty insurance policies or eminent
domain, condemnation or similar proceedings, in each case in excess of $500,000
in any Fiscal Year, the Borrowers shall prepay the Obligations in an amount
equal to all such proceeds, net of commissions and other reasonable and
customary transaction costs, fees and expenses properly attributable to such
transaction and payable by the Borrowers in connection therewith (in each case,
paid to non-Affiliates); provided that the Borrowers shall not be required to
prepay the Obligations with respect to (i) proceeds from the sales of assets in
the ordinary course of business, (ii) proceeds from other asset sales permitted
under Section 7.6, or (iii) proceeds from casualty insurance policies or eminent
domain, condemnation or similar proceedings that are reinvested in assets then
used or usable in the business of the Parent and its Subsidiaries within 180
days following receipt thereof, so long as such proceeds are held in Controlled
Accounts at SunTrust Bank or subject to Control Account Agreements until
reinvested.  Any such prepayment shall be applied in accordance with subsection
(d) of this Section.

 

(b)                                 Within one Business Day after receipt by the
Parent or any of its Subsidiaries of any proceeds from any issuance of
Indebtedness or equity securities by the Parent or any of its Subsidiaries, the
Borrowers shall prepay the Obligations in an amount equal to all such proceeds,
net of underwriting discounts and commissions and other reasonable and customary
transaction costs, fees and expenses properly attributable to such transaction
and payable by the Borrowers in connection therewith (in each case, paid to
non-Affiliates); provided that the Borrowers shall

 

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not be required to prepay the Obligations with respect to (i) proceeds of
Indebtedness permitted under Section 7.1, (ii) proceeds of Capital Stock issued
by a Loan Party to another Loan Party, (iii) proceeds of Capital Stock issued by
any Loan Party to members of management, directors, officers, and employees
pursuant to employment agreements, compensation or bonus plans, or employee
stock or option plans of the Parent and its Subsidiaries not to exceed 5.00% of
the total Capital Stock issued and outstanding on the Closing Date.  Any such
prepayment shall be applied in accordance with subsection (d) of this Section.

 

(c)                                  [Reserved.]

 

(d)                                 Any prepayments made by the Borrowers
pursuant to subsection (a), (b) or (c) of this Section shall be applied as
follows: first, to the Administrative Agent’s fees and reimbursable expenses
then due and payable pursuant to any of the Loan Documents; second, to all
reimbursable expenses of the Lenders and all fees and reimbursable expenses of
the Issuing Bank then due and payable pursuant to any of the Loan Documents, pro
rata to the Lenders and the Issuing Bank based on their respective pro rata
shares of such fees and expenses; third, to interest and fees then due and
payable hereunder, pro rata to the Lenders based on their respective pro rata
shares of such interest and fees; fourth, to the principal balance of the Agent
Advances, until the same have been paid in full, fifth, to the principal balance
of the Swingline Loans, until the same shall have been paid in full, to the
Swingline Lender; sixth, to the principal balance of the Revolving Loans, until
the same shall have been paid in full, pro rata to the Lenders based on their
respective Revolving Commitments; and seventh, if any Event of Default exists,
to Cash Collateralize the Letters of Credit in an amount in cash equal to the LC
Exposure as of such date plus any accrued and unpaid fees thereon.

 

(e)                                  If at any time the Aggregate Revolving
Credit Exposure exceeds the lesser of (i) the Borrowing Base and (ii) the
Aggregate Revolving Commitment Amount, the Borrowers shall immediately repay the
Swingline Loans, any Agent Advances, and the Revolving Loans in an amount equal
to such excess, together with all accrued and unpaid interest on such excess
amount.  Each prepayment shall be applied as follows: first, to the Agent
Advances to the full extent thereof; second, to the Swingline Loans to the full
extent thereof; and third, to the Revolving Loans to the full extent thereof. 
If, after giving effect to prepayment of all Swingline Loans, Agent Advances,
and Revolving Loans, the Aggregate Revolving Credit Exposure exceeds the
Aggregate Revolving Commitment Amount, the Borrowers shall Cash Collateralize
their reimbursement obligations with respect to all Letters of Credit in an
amount equal to such excess plus any accrued and unpaid fees thereon.  The
Aggregate Revolving Commitments of the Lenders shall not be permanently reduced
by the amount of any prepayments made pursuant to the immediately preceding
sentence.

 

Section 2.15.                         Interest on Loans.

 

(a)                                 The Borrowers shall pay interest on all
Loans at the Applicable Rate plus the Applicable Margin in effect from time to
time.

 

(b)                                 Any other term or provision of this
Agreement or any other Loan Document to the contrary notwithstanding, at the
option of the Required Lenders if an Event of Default has occurred and is
continuing, and automatically after the acceleration or deemed acceleration of
the Obligations hereunder, the Borrowers shall pay interest with respect to all
Loans and all other

 

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Obligations hereunder (other than Loans), at the rate per annum equal to  the
Applicable Rate, plus the Applicable Margin, plus 200 basis points.  In
addition, if any principal of or interest on any Loan is not paid when due, such
overdue amount shall bear interest at the rate per annum equal to 200 basis
points above the Applicable Rate. Any interest due under the immediately
preceding two sentences is referred to herein as the “Default Interest”.

 

(c)                                  Interest on the principal amount of all
Loans shall accrue from and including the date such Loans are made to but
excluding the date of any repayment thereof.  Interest on all Loans shall be
payable monthly in arrears on the first day of each calendar month and on the
Revolving Commitment Termination Date.  All Default Interest shall be payable on
demand.

 

Section 2.16.                         Fees.

 

(a)                                 The Borrowers shall pay to the
Administrative Agent for its own account fees in the amounts and at the times
previously agreed upon in writing by the Borrowers and the Administrative Agent.

 

(b)                                 The Borrowers agree to pay to the
Administrative Agent for the account of each Lender a commitment fee, which
shall accrue during the Availability Period at the Applicable Percentage on the
daily amount by which such Lender’s Revolving Commitment exceeds such Lender’s
Revolving Credit Exposure (excluding Swingline Exposure and Agent Advance
Exposure).

 

(c)                                  The Borrowers agree to pay (i) to the
Administrative Agent, for the account of each Lender, a letter of credit fee
with respect to its participation in each Letter of Credit, which shall accrue
each day at a rate per annum equal to the Applicable Margin for Eurodollar Loans
then in effect (plus, at all times that the Loans are bearing Default Interest,
2.00% per annum) times the amount of such Lender’s LC Exposure (excluding any
portion thereof attributable to unreimbursed LC Disbursements) attributable to
such Letter of Credit during the period from and including the date of issuance
of such Letter of Credit to but excluding the date on which such Letter of
Credit expires or is drawn in full (including, without limitation, any such LC
Exposure that remains outstanding after the Revolving Commitment Termination
Date) and (ii) to the Issuing Bank for its own account a fronting fee, which
shall accrue each day during the Availability Period (or until the date that
such Letter of Credit is irrevocably cancelled, whichever is later) at a rate
equal to 0.25% per annum times the amount of the LC Exposure (excluding any
portion thereof attributable to unreimbursed LC Disbursements) for such day, as
well as the Issuing Bank’s standard fees with respect to issuance, amendment,
renewal or extension of any Letter of Credit or processing of drawings
thereunder.

 

(d)                                 The Borrowers shall pay on the Closing Date
to the Administrative Agent and its Affiliates all fees in the Fee Letter that
are due and payable on the Closing Date.

 

(e)                                  Accrued fees under subsections (b) and
(c) of this Section shall be payable monthly in arrears on the first day of each
calendar month, commencing on August 1, 2016, and on the Revolving Commitment
Termination Date (and, if later, the date the Loans and LC Exposure shall be
repaid in their entirety); provided that any such fees accruing after the
Revolving Commitment Termination Date shall be payable on demand.

 

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(f)                                   Anything herein to the contrary
notwithstanding, during such period as a Lender is a Defaulting Lender, such
Defaulting Lender will not be entitled to commitment fees accruing with respect
to its Revolving Commitment during such period pursuant to subsection (b) of
this Section or letter of credit fees accruing during such period pursuant to
subsection (c) of this Section (without prejudice to the rights of the Lenders
other than Defaulting Lenders in respect of such fees), provided that (i) to the
extent that a portion of the LC Exposure of such Defaulting Lender is
reallocated to the Non-Defaulting Lenders pursuant to Section 2.28, such fees
that would have accrued for the benefit of such Defaulting Lender will instead
accrue for the benefit of and be payable to such Non-Defaulting Lenders, pro
rata in accordance with their respective Revolving Commitments, and (ii) to the
extent any portion of such LC Exposure cannot be so reallocated and has not been
cash collateralized by the Borrowers pursuant to Section 2.28, such fees will
instead accrue for the benefit of and be payable to the Issuing Bank.  The pro
rata payment provisions of Section 2.23 shall automatically be deemed adjusted
to reflect the provisions of this subsection.

 

Section 2.17.                         Computation of Interest and Fees.

 

Interest hereunder based on the Administrative Agent’s prime lending rate shall
be computed on the basis of a year of 365 days (or 366 days in a leap year) and
paid for the actual number of days elapsed (including the first day but
excluding the last day).  All other interest and all fees hereunder shall be
computed on the basis of a year of 360 days and paid for the actual number of
days elapsed (including the first day but excluding the last day).  Each
determination by the Administrative Agent of an interest rate or fee hereunder
shall be made in good faith and, except for manifest error, shall be final,
conclusive and binding for all purposes.

 

Section 2.18.                         Inability to Determine Interest Rates.  If
at any time:

 

(a)                                 the Administrative Agent shall have
determined (which determination shall be conclusive and binding upon the
Borrowers) that, by reason of circumstances affecting the relevant interbank
market, adequate means do not exist for ascertaining LIBOR as contemplated in
the definition of LIBOR, or

 

(b)                                 the Administrative Agent shall have received
notice from the Required Lenders that the Eurodollar Rate does not adequately
and fairly reflect the cost to such Lenders of making, funding or maintaining
their Loans,

 

the Administrative Agent shall give written notice (or telephonic notice,
promptly confirmed in writing) to the Borrower Agent and to the Lenders as soon
as practicable thereafter, the Applicable Rate shall automatically convert to
the Base Rate and remain as the Base Rate until such time as the Administrative
Agent shall have notified the Borrower Agent and the Lenders that the
circumstances giving rise to such notice no longer exist (at which time, the
Applicable Rate shall automatically convert to the Eurodollar Rate).

 

Section 2.19.                         Illegality.  If any Change in Law shall
make it unlawful or impossible for any Lender to make, maintain or fund any
Eurodollar Loan and such Lender shall so notify the Administrative Agent, the
Administrative Agent shall promptly give notice thereof to the Borrower Agent
and the other Lenders, whereupon until such Lender notifies the Administrative
Agent and the Borrower Agent that the circumstances giving rise to such
suspension no longer

 

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exist, the Applicable Rate for the Loans of such Lender shall automatically
convert to the Base Rate.  Notwithstanding the foregoing, the affected Lender
shall, before giving such notice to the Administrative Agent, designate a
different Applicable Lending Office if such designation would avoid the need for
giving such notice and if such designation would not otherwise be materially
disadvantageous to such Lender in the good faith exercise of its discretion. 
The Applicable Rate for the Loans of such Lender shall continue to be the Base
Rate until such time as such Lender may resume making Eurodollar Loans,
whereupon the Applicable Rate for the Loans of such Lender shall automatically
convert to the Eurodollar Rate.

 

Section 2.20.                         Increased Costs.

 

(a)                                 If any Change in Law shall:

 

(i)                                     impose, modify or deem applicable any
reserve, special deposit or similar requirement that is not otherwise included
in the determination of the Eurodollar Rate hereunder against assets of,
deposits with or for the account of, or credit extended by, any Lender (except
any such reserve requirement reflected in the Eurodollar Rate) or the Issuing
Bank; or

 

(ii)                                  impose on any Lender, the Issuing Bank or
the eurodollar interbank market any other condition affecting this Agreement or
any Eurodollar Loans made by such Lender or any Letter of Credit or any
participation therein;

 

and the result of any of the foregoing is to increase the cost to such Lender of
making or maintaining a Eurodollar Loan or to increase the cost to such Lender
or the Issuing Bank of participating in or issuing any Letter of Credit or to
reduce the amount received or receivable by such Lender or the Issuing Bank
hereunder (whether of principal, interest or any other amount),

 

then, from time to time, such Lender or the Issuing Bank may provide the
Borrower Agent (with a copy thereof to the Administrative Agent) with written
notice and demand with respect to such increased costs or reduced amounts with a
reasonable explanation thereof, and within five Business Days after receipt of
such notice and demand the Borrowers shall pay to such Lender or the Issuing
Bank, as the case may be, such additional amounts as will compensate such Lender
or the Issuing Bank for any such increased costs incurred or reduction suffered,
but only to the extent such Lender or the Issuing Bank as applicable, imposes
the same compensation standards on other similarly situated borrowers under
comparable credit facilities.

 

(b)                                 If any Lender or the Issuing Bank shall have
determined that after the date of this Agreement any Change in Law regarding
capital or liquidity requirements has or would have the effect of reducing the
rate of return on such Lender’s or the Issuing Bank’s capital (or on the capital
of the Parent Company of such Lender or the Issuing Bank) as a consequence of
its obligations hereunder or under or in respect of any Letter of Credit to a
level below that which such Lender, the Issuing Bank or such Parent Company
could have achieved but for such Change in Law (taking into consideration such
Lender’s or the Issuing Bank’s policies or the policies of such Parent Company
with respect to capital adequacy and liquidity), then, from time to time, such
Lender or the Issuing Bank may provide the Borrower Agent (with a copy thereof
to the Administrative Agent) with written notice and demand with respect to such
reduced amounts with a reasonable explanation thereof, and within five Business
Days after receipt of such notice

 

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and demand the Borrowers shall pay to such Lender or the Issuing Bank, as the
case may be, such additional amounts as will compensate such Lender, the Issuing
Bank or such Parent Company for any such reduction suffered, but only to the
extent such Lender imposes the same compensation standards on other similarly
situated borrowers under comparable credit facilities.

 

(c)                                  A certificate of such Lender or the Issuing
Bank setting forth the amount or amounts necessary to compensate such Lender,
the Issuing Bank or the Parent Company of such Lender or the Issuing Bank, as
the case may be, specified in subsection (a) or (b) of this Section shall be
delivered to the Borrower Agent (with a copy to the Administrative Agent) and
shall be conclusive, absent manifest error.

 

(d)                                 Failure or delay on the part of any Lender
or the Issuing Bank to demand compensation pursuant to this Section shall not
constitute a waiver of such Lender’s or the Issuing Bank’s right to demand such
compensation; provided that the Borrowers shall not be required to compensate a
Lender or the Issuing Bank pursuant to this Section for any increased costs
incurred or reductions suffered more than 180 days before the date that such
Lender or the Issuing Bank, as the case may be, notifies the Borrower Agent of
the Change in Law giving rise to such increased costs or reductions and of such
Lender’s or the Issuing Bank’s intention to claim compensation therefor (except
that, if the Change in Law giving rise to such increased costs or reductions is
retroactive, then the 180-day period referred to above shall be extended to
include the period of retroactive effect thereof).

 

Section 2.21.                         [Reserved.]

 

Section 2.22.                         Taxes.

 

(a)  Defined Terms.  For purposes of this Section 2.22, the term “Lender”
includes Issuing Bank and the term “applicable law” includes FATCA.

 

(b)  Payments Free of Taxes.  Any and all payments by or on account of any
obligation of any Loan Party under any Loan Document shall be made without
deduction or withholding for any Taxes, except as required by applicable law. 
If any applicable law (as determined in the good faith discretion of an
applicable Withholding Agent) requires the deduction or withholding of any Tax
from any such payment by a Withholding Agent, then the applicable Withholding
Agent shall be entitled to make such deduction or withholding and shall timely
pay the full amount deducted or withheld to the relevant Governmental Authority
in accordance with applicable law and, if such Tax is an Indemnified Tax, then
the sum payable by the applicable Loan Party shall be increased as necessary so
that after such deduction or withholding has been made (including such
deductions and withholdings applicable to additional sums payable under this
Section) the applicable Recipient receives an amount equal to the sum it would
have received had no such deduction or withholding been made.

 

(c)  Payment of Other Taxes by the Borrowers.  In addition, without limiting the
provision of subsection (b), the Borrowers shall timely pay to the relevant
Governmental Authority in accordance with applicable law, or at the option of
the Administrative Agent timely reimburse it for the payment of, any Other
Taxes.

 

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(d)  Indemnification by Parent and the Borrowers.  Each of the Parent and each
Borrower shall indemnify each Recipient, within 10 days after demand therefor,
for the full amount of any Indemnified Taxes (including Indemnified Taxes
imposed or asserted on or attributable to amounts payable under this Section)
payable or paid by such Recipient or required to be withheld or deducted from a
payment to such Recipient and any reasonable expenses arising therefrom or with
respect thereto, whether or not such Indemnified Taxes were correctly or legally
imposed or asserted by the relevant Governmental Authority.  A certificate as to
the amount of such payment or liability delivered to the Borrower Agent by a
Lender (with a copy to the Administrative Agent), or by the Administrative Agent
on its own behalf or on behalf of a Lender, shall be conclusive absent manifest
error.

 

(e)  Indemnification by the Lenders.  Each Lender shall severally indemnify the
Administrative Agent, within 10 days after demand therefor, for (i) any
Indemnified Taxes attributable to such Lender (but only to the extent that the
Parent or any Borrower has not already indemnified the Administrative Agent for
such Indemnified Taxes and without limiting the obligation of the Parent and
each Borrower to do so), (ii) any Taxes attributable to such Lender’s failure to
comply with the provisions of Section 10.4(d) relating to the maintenance of a
Participant Register and (iii) any Excluded Taxes attributable to such Lender,
in each case, that are payable or paid by the Administrative Agent in connection
with any Loan Document, and any reasonable expenses arising therefrom or with
respect thereto, whether or not such Taxes were correctly or legally imposed or
asserted by the relevant Governmental Authority.  A certificate as to the amount
of such payment or liability delivered to any Lender by the Administrative Agent
shall be conclusive absent manifest error.  Each Lender hereby authorizes the
Administrative Agent to set off and apply any and all amounts at any time owing
to such Lender under any Loan Document or otherwise payable by the
Administrative Agent to the Lender from any other source against any amount due
to the Administrative Agent under this paragraph (e).

 

(f)  Evidence of Payments.  As soon as practicable after any payment of Taxes by
the Borrowers or any other Loan Party to a Governmental Authority pursuant to
this Section 2.22, the Borrowers or other Loan Party shall deliver to the
Administrative Agent the original or a certified copy of a receipt issued by
such Governmental Authority evidencing such payment, a copy of the return
reporting such payment or other evidence of such payment reasonably satisfactory
to the Administrative Agent.

 

(g)  Status of Lenders.

 

(i) Any Lender that is entitled to an exemption from or reduction of withholding
Tax with respect to payments made under any Loan Document shall deliver to the
Borrower Agent and the Administrative Agent, at the time or times reasonably
requested by the Borrower Agent or the Administrative Agent, such properly
completed and executed documentation reasonably requested by the Borrower Agent
or the Administrative Agent as will permit such payments to be made without
withholding or at a reduced rate of withholding.  In addition, any Lender, if
reasonably requested by the Borrower Agent or the Administrative Agent, shall
deliver such other documentation prescribed by applicable law or

 

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reasonably requested by the Borrower Agent or the Administrative Agent as will
enable the Borrower Agent or the Administrative Agent to determine whether or
not such Lender is subject to backup withholding or information reporting
requirements.  Notwithstanding anything to the contrary in the preceding two
sentences, the completion, execution and submission of such documentation (other
than such documentation set forth in Section 2.22(g)(ii)(A), (ii)(B), and
(ii)(D) below) shall not be required if in the Lender’s reasonable judgment such
completion, execution or submission would subject such Lender to any material
unreimbursed cost or expense or would materially prejudice the legal or
commercial position of such Lender.

 

(ii) Without limiting the generality of the foregoing, if any Borrower is a U.S.
Borrower,

 

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

 

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

 

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

 

(2)  executed originals of IRS Form W-8ECI;

 

(3) in the case of a Foreign Lender claiming the benefits of the exemption for
portfolio interest under Section 881(c) of the Code, (x) a certificate
substantially in the form of Exhibit 2.22A to the effect that such Foreign
Lender is not a “bank” within the meaning of Section 881(c)(3)(A) of the Code, a
“10 percent shareholder” of the Parent or any of its Subsidiaries within the
meaning of Section 881(c)(3)(B) of the Code, or a “controlled foreign
corporation” described

 

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in Section 881(c)(3)(C) of the Code (a “U.S. Tax Compliance Certificate”) and
(y) executed originals of IRS Form W-8BEN or W-8BEN-E ; or

 

(4) to the extent a Foreign Lender is not the beneficial owner, executed
originals of IRS Form W-8IMY, accompanied by IRS Form W-8ECI, IRS Form W-8BEN or
W-8BEN-E, a U.S. Tax Compliance Certificate substantially in the form of
Exhibit 2.22B or Exhibit 2.22C, IRS Form W-9, and/or other certification
documents from each beneficial owner, as applicable; provided that if the
Foreign Lender is a partnership and one or more direct or indirect partners of
such Foreign Lender are claiming the portfolio interest exemption, such Foreign
Lender may provide a U.S. Tax Compliance Certificate substantially in the form
of Exhibit 2.22D on behalf of each such direct and indirect partner;

 

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

 

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

 

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

 

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(h)  Treatment of Certain Refunds.  If any party determines, in its sole
discretion exercised in good faith, that it has received a refund of any Taxes
as to which it has been indemnified pursuant to this Section 2.22 (including by
the payment of additional amounts pursuant to this Section 2.22), it shall pay
to the indemnifying party an amount equal to such refund (but only to the extent
of indemnity payments made under this Section with respect to the Taxes giving
rise to such refund), net of all out-of-pocket expenses (including Taxes) of
such indemnified party and without interest (other than any interest paid by the
relevant Governmental Authority with respect to such refund).  Such indemnifying
party, upon the request of such indemnified party, shall repay to such
indemnified party the amount paid over pursuant to this paragraph (h) (plus any
penalties, interest or other charges imposed by the relevant Governmental
Authority) if such indemnified party is required to repay such refund to such
Governmental Authority.  Notwithstanding anything to the contrary in this
paragraph (h), in no event will the indemnified party be required to pay any
amount to an indemnifying party pursuant to this paragraph (h) the payment of
which would place the indemnified party in a less favorable net after-Tax
position than the indemnified party would have been in if the Tax subject to
indemnification and giving rise to such refund had not been deducted, withheld
or otherwise imposed and the indemnification payments or additional amounts with
respect to such Tax had never been paid.  This paragraph shall not be construed
to require any indemnified party to make available its Tax returns (or any other
information relating to its Taxes that it deems confidential) to the
indemnifying party or any other Person.

 

(i)  Survival.  Each party’s obligations under this Section 2.22 shall survive
the resignation or replacement of the Administrative Agent or any assignment of
rights by, or the replacement of, a Lender, the termination of the Commitments
and the repayment, satisfaction or discharge of all obligations under any Loan
Document.

 

Section 2.23.                         Payments Generally; Pro Rata Treatment;
Sharing of Set-offs.

 

(a)                                 The Borrowers shall make each payment
required to be made by it hereunder (whether of principal, interest, fees or
reimbursement of LC Disbursements, or of amounts payable under Section 2.20 or
2.22, or otherwise) before 12:00 noon on the date when due, in immediately
available funds, free and clear of any defenses, rights of set-off,
counterclaim, or (except as expressly provided in Section 2.22) withholding or
deduction of taxes.  Any amounts received after such time on any date may, in
the discretion of the Administrative Agent, be deemed to have been received on
the next succeeding Business Day for purposes of calculating interest thereon. 
All such payments shall be made to the Administrative Agent at the Payment
Office, except payments to be made directly to the Issuing Bank or the Swingline
Lender as expressly provided herein and except that payments pursuant to
Sections 2.20, 2.22 and 10.3 shall be made directly to the Persons entitled
thereto.  The Administrative Agent shall distribute any such payments received
by it for the account of any other Person to the appropriate recipient promptly
following receipt thereof.  If any payment hereunder shall be due on a day that
is not a Business Day, the date for payment shall be extended to the next
succeeding Business Day, and, in the case of any payment accruing interest,
interest thereon shall be made payable for the period of such extension.  All
payments hereunder shall be made in Dollars.

 

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(b)                                 If at any time insufficient funds are
received by and available to the Administrative Agent to pay fully all amounts
of principal, unreimbursed LC Disbursements, interest and fees then due
hereunder, such funds shall be applied as follows: first, to all fees and
reimbursable expenses of the Administrative Agent then due and payable pursuant
to any of the Loan Documents; second, to all reimbursable expenses of the
Lenders and all fees and reimbursable expenses of the Issuing Bank then due and
payable pursuant to any of the Loan Documents, pro rata to the Lenders and the
Issuing Bank based on their respective pro rata shares of such fees and
expenses; third, to all interest and fees then due and payable hereunder, pro
rata to the Lenders based on their respective pro rata shares of such interest
and fees; and fourth, to all principal of the Loans and unreimbursed LC
Disbursements then due and payable hereunder, pro rata to the parties entitled
thereto based on their respective pro rata shares of such principal and
unreimbursed LC Disbursements.

 

(c)                                  If any Lender shall, by exercising any
right of set-off or counterclaim or otherwise, obtain payment in respect of any
principal of or interest on any of its Loans or participations in LC
Disbursements, Swingline Loans, or Agent Advances that would result in such
Lender receiving payment of a greater proportion of the aggregate amount of its
Revolving Credit Exposure and accrued interest and fees thereon than the
proportion received by any other Lender with respect to its Revolving Credit
Exposure, then the Lender receiving such greater proportion shall purchase (for
cash at face value) participations in the Revolving Credit Exposure of other
Lenders to the extent necessary so that the benefit of all such payments shall
be shared by the Lenders ratably in accordance with the aggregate amount of
principal of and accrued interest on their respective Revolving Credit Exposure;
provided that (i) if any such participations are purchased and all or any
portion of the payment giving rise thereto is recovered, such participations
shall be rescinded and the purchase price restored to the extent of such
recovery, without interest, and (ii) the provisions of this subsection shall not
be construed to apply to any payment made by the Borrowers pursuant to and in
accordance with the express terms of this Agreement (including the application
of funds arising from the existence of a Defaulting Lender) or any payment
obtained by a Lender as consideration for the assignment of or sale of a
participation in any of its Revolving Credit Exposure to any assignee or
participant, other than to the Parent or any Subsidiary or Affiliate thereof (as
to which the provisions of this subsection shall apply).  Each of the Parent and
each Borrower consents to the foregoing and agrees, to the extent it may
effectively do so under applicable law, that any Lender acquiring a
participation pursuant to the foregoing arrangements may exercise against any
Loan Party’s rights of set-off and counterclaim with respect to such
participation as fully as if such Lender were a direct creditor of the Parent or
any Borrower in the amount of such participation.

 

(d)                                 Unless the Administrative Agent shall have
received notice from the Borrower Agent before the date on which any payment is
due to the Administrative Agent for the account of the Lenders or the Issuing
Bank hereunder that the Borrowers will not make such payment, the Administrative
Agent may assume that the Borrowers have made such payment on such date in
accordance herewith and may, in reliance upon such assumption, distribute to the
Lenders or the Issuing Bank, as the case may be, the amount or amounts due.  In
such event, if the Borrowers have not in fact made such payment, then each of
the Lenders or the Issuing Bank, as the case may be, severally agrees to repay
to the Administrative Agent forthwith on demand the amount so distributed to
such Lender or Issuing Bank with interest thereon, for each day from and
including the date such amount is distributed to it to but excluding the date of
payment to the

 

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Administrative Agent, at the greater of the Federal Funds Rate and a rate
determined by the Administrative Agent in accordance with banking industry
rules on interbank compensation.

 

(e)                                  Notwithstanding anything herein to the
contrary, any amount paid by the Borrower for the account of a Defaulting Lender
under this Agreement (whether on account of principal, interest, fees,
reimbursement of LC Disbursements, indemnity payments or other amounts) will be
retained by the Administrative Agent in a segregated non-interest bearing
account until the Revolving Commitment Termination Date, at which time the funds
in such account will be applied by the Administrative Agent, to the fullest
extent permitted by law, in the following order of priority: first, to the
payment of any amounts owing by such Defaulting Lender to the Administrative
Agent under this Agreement; second, to the payment of any amounts owing by such
Defaulting Lender to the Issuing Bank and the Swingline Lender under this
Agreement; third, to the payment of interest due and payable to the Lenders
hereunder that are not Defaulting Lenders, ratably among them in accordance with
the amounts of such interest then due and payable to them; fourth, to the
payment of fees then due and payable to the Lenders hereunder that are not
Defaulting Lenders, ratably among them in accordance with the amounts of such
fees then due and payable to them; fifth, to the payment of principal and
unreimbursed LC Disbursements then due and payable to the Lenders hereunder that
are not Defaulting Lenders, ratably in accordance with the amounts thereof then
due and payable to them; sixth, to the ratable payment of other amounts then due
and payable to the Lenders hereunder that are not Defaulting Lenders; and
seventh, to pay amounts owing under this Agreement to such Defaulting Lender or
as a court of competent jurisdiction may otherwise direct.

 

Section 2.24.                         Letters of Credit.

 

(a)                                 During the Availability Period, the Issuing
Bank, in reliance upon the agreements of the other Lenders pursuant to
subsections (d) and (e) of this Section, shall issue, at the request of the
Borrower Agent, Letters of Credit for the account of any Borrower on the terms
and conditions hereinafter set forth; provided that (i) each Letter of Credit
shall expire on the earlier of (A) the date one year after the date of issuance
of such Letter of Credit (or, in the case of any renewal or extension thereof,
one year after such renewal or extension) and (B) the date that is five Business
Days before the Revolving Commitment Termination Date; (ii) each Letter of
Credit shall be in a stated amount of at least $100,000 (or such lesser amount
as the Issuing Bank may agree to, such agreement to be evidenced by the issuance
of such Letter of Credit); (iii) no Borrower may request any Letter of Credit
if, after giving effect to such issuance, (A) the aggregate LC Exposure would
exceed the LC Commitment or (B) the Aggregate Revolving Credit Exposure would
exceed the lesser of (1) the Borrowing Base and (2) Aggregate Revolving
Commitment Amount, and (iv) no Borrower shall request, and the Issuing Bank
shall have no obligation to issue, any Letter of Credit the proceeds of which
would be made available to any Persons (i) to fund any activity or business of
or with any Sanctioned Person or in any Sanctioned Countries, that, at the time
of such funding, is the subject of any sanctions or (ii) in any manner that
would result in a violation of any Sanctions by any party to this Agreement.
Notwithstanding the foregoing, any Letter of Credit may contain customary
automatic renewal provisions agreed upon by any Borrower and the Issuing Bank
pursuant to which the expiration date of such Letter of Credit shall
automatically be extended for a period of up to 12  months (but not to a date
later than the date set forth in clause (i) (B) above), subject to a right on
the part of the Issuing Bank, in its discretion, to prevent any such renewal
from occurring by giving

 

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notice to the beneficiary in advance of any such renewal. Each Lender shall be
deemed to have purchased, and hereby irrevocably and unconditionally purchases
from the Issuing Bank without recourse a participation in each Letter of Credit
equal to such Lender’s Pro Rata Share of the aggregate amount available to be
drawn under such Letter of Credit on the date of issuance.  Each issuance of a
Letter of Credit shall be deemed to utilize the Revolving Commitment of each
Lender by an amount equal to the amount of such participation.

 

(b)                                 To request the issuance of a Letter of
Credit (or any amendment, renewal or extension of an outstanding Letter of
Credit), the applicable Borrower shall give the Issuing Bank and the
Administrative Agent irrevocable written notice at least three Business Days
before the requested date of such issuance specifying the date (which shall be a
Business Day) such Letter of Credit is to be issued (or amended, renewed or
extended, as the case may be), the expiration date of such Letter of Credit, the
amount of such Letter of Credit, the name and address of the beneficiary thereof
and such other information as shall be necessary to prepare, amend, renew or
extend such Letter of Credit.  In addition to the satisfaction of the conditions
in Article III, the issuance of such Letter of Credit (or any amendment which
increases the amount of such Letter of Credit) will be subject to the further
conditions that such Letter of Credit shall be in such form and contain such
terms as shall be reasonably acceptable to  the Issuing Bank and that such
Borrower shall have executed and delivered any additional applications,
agreements and instruments relating to such Letter of Credit as the Issuing Bank
shall reasonably require; provided that in the event of any conflict between
such applications, agreements or instruments and this Agreement, the terms of
this Agreement shall control.

 

(c)                                  At least two Business Days before the
issuance of any Letter of Credit, the Issuing Bank will confirm with the
Administrative Agent (by telephone or in writing) that the Administrative Agent
has received such notice, and, if not, the Issuing Bank will provide the
Administrative Agent with a copy thereof.  Unless the Issuing Bank has received
notice from the Administrative Agent, on or before the Business Day immediately
preceding the date the Issuing Bank is to issue the requested Letter of Credit,
directing the Issuing Bank not to issue the Letter of Credit because such
issuance is not then permitted hereunder because of the limitations set forth in
subsection (a) of this Section or that one or more conditions specified in
Article III are not then satisfied, then, subject to the terms and conditions
hereof, the Issuing Bank shall, on the requested date, issue such Letter of
Credit in accordance with the Issuing Bank’s usual and customary business
practices.

 

(d)                                 The Issuing Bank shall examine all documents
purporting to represent a demand for payment under a Letter of Credit promptly
following its receipt thereof.  The Issuing Bank shall notify the Borrower Agent
and the Administrative Agent of such demand for payment and whether the Issuing
Bank has made or will make a LC Disbursement thereunder; provided that any
failure to give or delay in giving such notice shall not relieve any Borrower of
its respective obligation to reimburse the Issuing Bank and the Lenders with
respect to such LC Disbursement.  Each Borrower shall be irrevocably and
unconditionally obligated to reimburse the Issuing Bank for any LC Disbursements
paid by the Issuing Bank in respect of such drawing, without presentment, demand
or other formalities of any kind.  Unless the Borrower Agent shall have notified
the Issuing Bank and the Administrative Agent before 11:00 a.m. on the Business
Day immediately before the date on which such drawing is honored that the
Borrowers intend to reimburse the Issuing Bank for the amount of such drawing in
funds other than from the

 

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proceeds of Revolving Loans, the Borrowers shall be deemed to have timely given
a Notice of Revolving Borrowing to the Administrative Agent requesting the
Lenders to make a Borrowing on the date on which such drawing is honored in an
exact amount due to the Issuing Bank; provided that for purposes solely of such
Borrowing, the conditions precedent set forth in Section 3.2 hereof shall not be
applicable.  The Administrative Agent shall notify the Lenders of such Borrowing
in accordance with Section 2.3, and each Lender shall make the proceeds of its
Loan included in such Borrowing available to the Administrative Agent for the
account of the Issuing Bank in accordance with Section 2.8.  The proceeds of
such Borrowing shall be applied directly by the Administrative Agent to
reimburse the Issuing Bank for such LC Disbursement.

 

(e)                                  If for any reason a Borrowing may not be
(as determined in the sole discretion of the Administrative Agent), or is not,
made in accordance with the foregoing provisions, then each Lender (other than
the Issuing Bank) shall be obligated to fund the participation that such Lender
purchased pursuant to subsection (a) of this Section in an amount equal to its
Pro Rata Share of such LC Disbursement on and as of the date which such
Borrowing should have occurred.  Each Lender’s obligation to fund its
participation shall be absolute and unconditional and shall not be affected by
any circumstance, including, without limitation, (i) any set-off, counterclaim,
recoupment, defense or other right that such Lender or any other Person may have
against the Issuing Bank or any other Person for any reason whatsoever, (ii) the
existence of a Default or an Event of Default or the termination of the
Aggregate Revolving Commitments, (iii) any adverse change in the condition
(financial or otherwise) of the Parent or any of its Subsidiaries, (iv) any
breach of this Agreement by any Loan Party or any other Lender, (v) any
amendment, renewal or extension of any Letter of Credit or (vi) any other
circumstance, happening or event whatsoever, whether or not similar to any of
the foregoing.  On the date that such participation is required to be funded,
each Lender shall promptly transfer, in immediately available funds, the amount
of its participation to the Administrative Agent for the account of the Issuing
Bank.  Whenever, at any time after the Issuing Bank has received from any such
Lender the funds for its participation in a LC Disbursement, the Issuing Bank
(or the Administrative Agent on its behalf) receives any payment on account
thereof, the Administrative Agent or the Issuing Bank, as the case may be, will
distribute to such Lender its Pro Rata Share of such payment; provided that if
such payment is required to be returned for any reason to the Parent or any
Borrower or to a trustee, receiver, liquidator, custodian or similar official in
any bankruptcy proceeding, such Lender will return to the Administrative Agent
or the Issuing Bank any portion thereof previously distributed by the
Administrative Agent or the Issuing Bank to it.

 

(f)                                   To the extent that any Lender shall fail
to pay any amount required to be paid pursuant to subsection (d) or (e) of this
Section on the due date therefor, such Lender shall pay interest to the Issuing
Bank (through the Administrative Agent) on such amount from such due date to the
date such payment is made at a rate per annum equal to the Federal Funds Rate;
provided that if such Lender shall fail to make such payment to the Issuing Bank
within three Business Days of such due date, then, retroactively to the due
date, such Lender shall be obligated to pay interest on such amount at the rate
set forth in Section 2.15(c).

 

(g)                                  If any Event of Default shall occur and be
continuing, on the Business Day that any Borrower receives notice from the
Administrative Agent or the Required Lenders demanding that its reimbursement
obligations with respect to the Letters of Credit be Cash Collateralized
pursuant to this subsection, the Borrowers shall deposit in an account with the
Administrative

 

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Agent, in the name of the Administrative Agent and for the benefit of the
Issuing Bank and the Lenders, an amount in cash equal to 105% of the aggregate
LC Exposure of all Lenders as of such date plus any accrued and unpaid fees
thereon; provided that such obligation to Cash Collateralize the reimbursement
obligations of the Borrowers with respect to the Letters of Credit shall become
effective immediately, and such deposit shall become immediately due and
payable, without demand or notice of any kind, upon the occurrence of any Event
of Default with respect to the Borrowers described in Section 8.1(h) or (i). 
Such deposit shall be held by the Administrative Agent as collateral for the
payment and performance of the obligations of the Borrowers under this
Agreement.  The Administrative Agent shall have exclusive dominion and control,
including the exclusive right of withdrawal, over such account.  Each Borrower
agrees to execute any documents and/or certificates to effectuate the intent of
this subsection.  Other than any interest earned on the investment of such
deposits, which investments shall be made at the option and sole discretion of
the Administrative Agent and at the Borrowers’ risk and expense, such deposits
shall not bear interest.  Interest and profits, if any, on such investments
shall accumulate in such account.  Moneys in such account shall be applied by
the Administrative Agent to reimburse the Issuing Bank for LC Disbursements for
which it had not been reimbursed and, to the extent not so applied, shall be
held for the satisfaction of the reimbursement obligations of the Borrowers for
the LC Exposure at such time or, if the maturity of the Loans has been
accelerated, with the consent of the Required Lenders, be applied to satisfy
other obligations of the Borrowers under this Agreement and the other Loan
Documents.  If any Borrower is required to Cash Collateralize its reimbursement
obligations with respect to the Letters of Credit as a result of the occurrence
of an Event of Default, such cash collateral so posted (to the extent not so
applied as aforesaid) shall be returned to the Borrowers within three Business
Days after all Events of Default have been cured or waived.

 

(h)                                 Upon the request of any Lender, but no more
frequently than quarterly, the Issuing Bank shall deliver (through the
Administrative Agent) to each Lender and the Borrower Agent a report describing
the aggregate Letters of Credit then outstanding.  Upon the request of any
Lender from time to time, the Issuing Bank shall deliver to such Lender any
other information reasonably requested by such Lender with respect to each
Letter of Credit then outstanding.

 

(i)                                     The Borrowers’ obligation to reimburse
LC Disbursements hereunder shall be absolute, unconditional and irrevocable and
shall be performed strictly in accordance with the terms of this Agreement under
all circumstances whatsoever and irrespective of any of the following
circumstances:

 

(i)                                     any lack of validity or enforceability
of any Letter of Credit or this Agreement;

 

(ii)                                  the existence of any claim, set-off,
defense or other right which the Parent or any Subsidiary or Affiliate of the
Parent may have at any time against a beneficiary or any transferee of any
Letter of Credit (or any Persons or entities for whom any such beneficiary or
transferee may be acting), any Lender (including the Issuing Bank) or any other
Person, whether in connection with this Agreement or the Letter of Credit or any
document related hereto or thereto or any unrelated transaction;

 

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(iii)                               any draft or other document presented under
a Letter of Credit proving to be forged, fraudulent or invalid in any respect or
any statement therein being untrue or inaccurate in any respect;

 

(iv)                              payment by the Issuing Bank under a Letter of
Credit against presentation of a draft or other document to the Issuing Bank
that does not comply with the terms of such Letter of Credit;

 

(v)                                 any other event or circumstance whatsoever,
whether or not similar to any of the foregoing, that might, but for the
provisions of this Section, constitute a legal or equitable discharge of, or
provide a right of set-off against, the Borrowers’ obligations hereunder; or

 

(vi)                              the existence of a Default or an Event of
Default.

 

Neither the Administrative Agent, the Issuing Bank, any Lender nor any Related
Party of any of the foregoing shall have any liability or responsibility by
reason of or in connection with the issuance or transfer of any Letter of Credit
or any payment or failure to make any payment thereunder (irrespective of any of
the circumstances referred to above), or any error, omission, interruption, loss
or delay in transmission or delivery of any draft, notice or other communication
under or relating to any Letter of Credit (including any document required to
make a drawing thereunder), any error in interpretation of technical terms or
any consequence arising from causes beyond the control of the Issuing Bank;
provided that the foregoing shall not be construed to excuse the Issuing Bank
from liability to the Borrowers to the extent of any actual direct damages (as
opposed to special, indirect (including claims for lost profits or other
consequential damages), or punitive damages, claims in respect of which are
hereby waived by the Borrowers to the extent permitted by applicable law)
suffered by the Borrowers that are caused by the Issuing Bank’s failure to
exercise due care when determining whether drafts or other documents presented
under a Letter of Credit comply with the terms thereof.  The parties hereto
expressly agree that, in the absence of gross negligence or willful misconduct
on the part of the Issuing Bank (as finally determined by a court of competent
jurisdiction), the Issuing Bank shall be deemed to have exercised due care in
each such determination.  In furtherance of the foregoing and without limiting
the generality thereof, the parties agree that, with respect to documents
presented that appear on their face to be in substantial compliance with the
terms of a Letter of Credit, the Issuing Bank may, in its sole discretion,
either accept and make payment upon such documents without responsibility for
further investigation, regardless of any notice or information to the contrary,
or refuse to accept and make payment upon such documents if such documents are
not in strict compliance with the terms of such Letter of Credit.

 

(j)                                    Unless otherwise expressly agreed by the
Issuing Bank and the applicable Borrower when a Letter of Credit is issued and
subject to applicable laws, (i) each standby Letter of Credit shall be governed
by the “International Standby Practices 1998” (ISP98) (or such later revision as
may be published by the Institute of International Banking Law & Practice on any
date any Letter of Credit may be issued), (ii) each documentary Letter of Credit
shall be governed by the Uniform Customs and Practices for Documentary Credits
(2007 Revision), International Chamber of Commerce Publication No. 600 (or such
later revision as may be published by the International Chamber of Commerce on
any date any Letter of Credit may be

 

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issued) and (iii) if requested by the Issuing Bank, such Borrower shall specify
the foregoing in each letter of credit application submitted for the issuance of
a Letter of Credit.

 

Section 2.25.                         Increase of Commitments; Additional
Lenders.

 

(a)                                 From time to time after the Closing Date and
in accordance with this Section, Parent, the Borrowers, and one or more
Increasing Lenders or Additional Lenders (each as defined below) may enter into
an agreement to increase the aggregate Revolving Commitments hereunder (each
such increase, an “Incremental Commitment”) so long as the following conditions
are satisfied:

 

(i)                                     the aggregate principal amount of all
such Incremental Commitments made pursuant to this Section shall not exceed
$15,000,000 (the principal amount of each such Incremental Commitment, the
“Incremental Commitment Amount”);

 

(ii)                                  the Loan Parties shall execute and deliver
such documents and instruments and take such other actions as may be reasonably
required by the Administrative Agent in connection with and at the time of any
such proposed increase;

 

(iii)                               at the time of and immediately after giving
effect to any such proposed increase, no Default or Event of Default shall
exist, all representations and warranties of each Loan Party set forth in the
Loan Documents shall be true and correct in all material respects (other than
those representations and warranties that are expressly qualified by a Material
Adverse Effect or other materiality qualifier, in which case such
representations and warranties shall be true and correct in all respects), and,
since March 27, 2016, there shall have been no change which has had or could
reasonably be expected to have a Material Adverse Effect;

 

(iv)                              any incremental Commitments shall have a
termination date no earlier than the Revolving Commitment Termination Date;

 

(v)                                 Parent and its Subsidiaries shall be in pro
forma compliance with each of the financial covenants set forth in Article VI as
of the most recently ended Fiscal Month for which financial statements are
required to have been delivered, calculated as if all such Incremental Revolving
Commitments had been established (and fully funded) as of the first day of the
relevant period for testing compliance;

 

(vi)                              [reserved];

 

(vii)                           any collateral securing any such Incremental
Commitments shall also secure all other Obligations on a pari passu basis; and

 

(viii)                        all other terms and conditions with respect to any
such Incremental Commitments shall be reasonably satisfactory to the
Administrative Agent.

 

(b)                                 The Borrower Agent shall provide at least 30
days’ written notice to the Administrative Agent (who shall promptly provide a
copy of such notice to each Lender) of any proposal to establish an Incremental
Commitment (or such shorter period as shall be agreed by the Administrative
Agent).  The Borrower Agent may also, but is not required to, specify any

 

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fees offered to those Lenders (the “Increasing Lenders”) that agree to increase
the principal amount of their Revolving Commitments, which fees may be variable
based upon the amount by which any such Lender is willing to increase the
principal amount of its Revolving Commitment.  Each Increasing Lender shall as
soon as practicable, and in any case within 15 days following receipt of such
notice (or such shorter period of time as shall have been agreed to by the
Administrative Agent), specify in a written notice to the Borrower Agent and the
Administrative Agent the amount of such proposed Incremental Commitment that it
is willing to provide.  No Lender (or any successor thereto) shall have any
obligation, express or implied, to offer to increase the aggregate principal
amount of its Revolving Commitment, and any decision by a Lender to increase its
Revolving Commitment shall be made in its sole discretion independently from any
other Lender.  Only the consent of each Increasing Lender shall be required for
an increase in the aggregate principal amount of the Revolving Commitments
pursuant to this Section.  No Lender which declines to increase the principal
amount of its Revolving Commitment may be replaced with respect to its existing
Revolving Commitment as a result thereof without such Lender’s consent.  If any
Lender shall fail to notify the Borrower Agent and the Administrative Agent in
writing about whether it will increase its Revolving Commitment within 15 days
after receipt of such notice (or such shorter period of time as shall have been
agreed to by the Administrative Agent), such Lender shall be deemed to have
declined to increase its Revolving Commitment.  Parent and Borrowers may accept
some or all of the offered amounts or designate new lenders that are acceptable
to the Administrative Agent (such approval not to be unreasonably withheld) as
additional Lenders hereunder in accordance with this Section (the “Additional
Lenders”), which Additional Lenders may assume all or a portion of such
Incremental Commitment.  Parent, the Borrowers, and the Administrative Agent
shall have discretion jointly to adjust the allocation of such Incremental
Revolving Commitments among the Increasing Lenders and the Additional Lenders. 
The sum of the increase in the Revolving Commitments of the Increasing Lenders
plus the Revolving Commitments of the Additional Lenders shall not in the
aggregate exceed the unsubscribed amount of the Incremental Commitment Amount.

 

(c)                                  Subject to the foregoing provisions of this
Section, any increase requested by the Borrowers shall be effective upon
delivery to the Administrative Agent of each of the following documents:

 

(i)                                     an originally executed copy of an
instrument of joinder, in form and substance reasonably acceptable to the
Administrative Agent, executed by each Borrower, by each Additional Lender and
by each Increasing Lender, setting forth the new Revolving Commitments of such
Lenders and setting forth the agreement of each Additional Lender to become a
party to this Agreement and to be bound by all of the terms and provisions
hereof;

 

(ii)                                  such evidence of appropriate corporate
authorization on the part of Parent and the Borrowers with respect to such
Incremental Commitment and such opinions of counsel for Parent and the Borrowers
with respect to such Incremental Commitment as the Administrative Agent may
reasonably request;

 

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(iii)                               a certificate of Parent and each Borrower
signed by a Responsible Officer, in form and substance reasonably acceptable to
the Administrative Agent, certifying that each of the conditions in subsection
(a) of this Section has been satisfied;

 

(iv)                              to the extent requested by any Additional
Lender or any Increasing Lender, executed promissory notes evidencing such
Incremental Revolving Commitments issued by each Borrower in accordance with
Section 2.12; and

 

(v) any other certificates or documents that the Administrative Agent shall
reasonably request, in form and substance reasonably satisfactory to the
Administrative Agent.

 

Upon the effectiveness of any such Incremental Commitment, the Commitments and
Pro Rata Share of each Lender will be adjusted to give effect to the Incremental
Revolving Commitments and Schedule I shall automatically be deemed amended
accordingly.

 

(d)                                 If any Incremental Commitments are to have
terms that are different from the Revolving Commitments outstanding immediately
before the effectiveness thereof (any such Incremental Commitments, the
“Non-Conforming Credit Extensions”), all such terms shall be as set forth in a
separate assumption agreement among the Parent, each Borrower, the Lenders
providing such Incremental Commitments and the Administrative Agent, the
execution and delivery of which agreement shall be a condition to the
effectiveness of the Non-Conforming Credit Extensions.  If the Parent or any
Borrower incurs Incremental Commitments under this Section, regardless of
whether such Incremental Commitments are Non-Conforming Credit Extensions, the
Borrowers shall, after such time, repay and incur Revolving Loans ratably as
between the Incremental Commitments and the Revolving Commitments outstanding
immediately before the effectiveness thereof.  Notwithstanding anything to the
contrary in Section 10.2, the Administrative Agent is expressly permitted to
amend the Loan Documents to the extent necessary to give effect to any increase
pursuant to this Section and mechanical changes necessary or advisable in
connection therewith (including amendments to implement the requirements in this
clause (d), amendments to ensure pro rata allocations of Loans among all Lenders
and amendments to implement ratable participation in Letters of Credit between
the Non-Conforming Credit Extensions consisting of Incremental Commitments and
the Revolving Commitments outstanding immediately before the effectiveness of
the Incremental Commitments).

 

Section 2.26.                         Mitigation of Obligations.  If any Lender
requests compensation under Section 2.20, or if any Borrower is required to pay
any additional amount to any Lender or any Governmental Authority for the
account of any Lender pursuant to Section 2.22, then such Lender shall use
reasonable efforts to designate a different lending office for funding or
booking its Loans hereunder or to assign its rights and obligations hereunder to
another of its offices, branches or affiliates, if, in the sole judgment of such
Lender, such designation or assignment (i) would eliminate or reduce amounts
payable under Section 2.20 or Section 2.22, as the case may be, in the future
and (ii) would not subject such Lender to any unreimbursed cost or expense and
would not otherwise be disadvantageous to such Lender.  Each Borrower hereby
agrees to pay all costs and expenses incurred by any Lender in connection with
such designation or assignment.

 

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Section 2.27.                         Replacement of Lenders.  If (a) any Lender
requests compensation under Section 2.20, or if any Borrower is required to pay
any additional amount to any Lender or any Governmental Authority for the
account of any Lender pursuant to Section 2.22,  (b) any Lender is a Defaulting
Lender, (c) any Lender gives a notice under Section 2.19 that has not been
rescinded or (d) any Lender has failed to consent to a proposed amendment,
waiver or modification that under Section 10.2  requires the consent of all the
Lenders (or all of the affected Lenders) and with respect to which the Required
Lenders shall have granted their consent,  then the Borrowers may, at their sole
expense and effort, upon notice to such Lender and the Administrative Agent,
require such Lender to assign and delegate, without recourse (in accordance with
and subject to the restrictions set forth in Section 10.4(b)), all of its
interests, rights (other than, if applicable, its existing rights to payments
pursuant to Section 2.20 or 2.22, as applicable) and obligations under this
Agreement to an assignee that shall assume such obligations (which assignee may
be another Lender) (a “Replacement Lender”); provided that (i) the Borrowers
shall have received the prior written consent of the Administrative Agent, which
consent shall not be unreasonably withheld, (ii) such Lender shall have received
payment of an amount equal to the outstanding principal amount of all Loans owed
to it, accrued interest thereon, accrued fees and all other amounts payable to
it hereunder from the assignee (in the case of such outstanding principal and
accrued interest) and from the Borrowers (in the case of all other amounts), and
(iii) in the case of a claim for compensation under Section 2.20 or payments
required to be made pursuant to Section 2.22, such assignment will result in a
reduction in such compensation or payments.  A Lender shall not be required to
make any such assignment and delegation if, prior thereto, as a result of a
waiver by such Lender or otherwise, the circumstances entitling the Borrowers to
require such assignment and delegation cease to apply.

 

Section 2.28.                         Defaulting Lenders.

 

(a)                                 Cash Collateral.

 

(i)  At any time that there shall exist a Defaulting Lender, within one Business
Day following the written request of the Administrative Agent or the Issuing
Bank (with a copy to the Administrative Agent) the Borrowers shall Cash
Collateralize the Issuing Bank’s LC Exposure with respect to such Defaulting
Lender (determined after giving effect to Section 2.28(b)(iv) and any Cash
Collateral provided by such Defaulting Lender) in an amount not less than 105%
of the Issuing Bank’s LC Exposure with respect to such Defaulting Lender.

 

(ii)                                  Parent and each Borrower, and to the
extent provided by any Defaulting Lender, such Defaulting Lender, hereby grants
to the Administrative Agent, for the benefit of the Issuing Bank, and agrees to
maintain, a first-priority security interest in all such Cash Collateral as
security for the Defaulting Lenders’ obligation to fund participations in
respect of Letters of Credit, to be applied pursuant to clause (iii) below.  If
at any time the Administrative Agent determines in its reasonable judgment that
Cash Collateral is subject to any right or claim of any Person other than the
Administrative Agent and the Issuing Bank as herein provided, or that the total
amount of such Cash Collateral is less than the minimum amount required pursuant
to clause (i) above, each Borrower will, promptly upon demand by the
Administrative Agent, pay or provide to the

 

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Administrative Agent additional Cash Collateral in an amount sufficient to
eliminate such deficiency (after giving effect to any Cash Collateral provided
by the Defaulting Lender).

 

(iii)                               Notwithstanding anything to the contrary
contained in this Agreement, Cash Collateral provided under this
Section 2.28(a) or Section 2.28(b)  in respect of Letters of Credit shall be
applied to the satisfaction of the Defaulting Lender’s obligation to fund
participations in respect of Letters of Credit or LC Disbursements (including,
as to Cash Collateral provided by a Defaulting Lender, any interest accrued on
such obligation) for which the Cash Collateral was so provided, before any other
application of such property as may otherwise be provided for herein.

 

(iv)                              Cash Collateral (or the appropriate portion
thereof) provided to reduce any Issuing Bank’s LC Exposure shall no longer be
required to be held as Cash Collateral pursuant to this
Section 2.28(a) following (A) the elimination of the applicable LC Exposure
(including by the termination of Defaulting Lender status of the applicable
Lender), or (B) the determination by the Administrative Agent and the Issuing
Bank that there exists excess Cash Collateral; provided that, subject to
Section 2.28(b)  through (d) the Person providing Cash Collateral and each
Issuing Bank may agree that Cash Collateral shall be held to support future
anticipated LC Exposure or other obligations and provided further that to the
extent that such Cash Collateral was provided by any Borrower, such Cash
Collateral shall remain subject to the security interest granted pursuant to the
Loan Documents.

 

(b)                                 Defaulting Lender Adjustments. 
Notwithstanding anything to the contrary contained in this Agreement, if any
Lender becomes a Defaulting Lender, then, until such time as such Lender is no
longer a Defaulting Lender, to the extent permitted by applicable law:

 

(i)                                     Such Defaulting Lender’s right to
approve or disapprove any amendment, waiver or consent with respect to this
Agreement shall be restricted as set forth in the definition of Required Lenders
and in Section 10.2.

 

(ii)                                  Any payment of principal, interest, fees
or other amounts received by the Administrative Agent for the account of such
Defaulting Lender (whether voluntary or mandatory, at maturity, pursuant to
Article VIII or otherwise) or received by the Administrative Agent from a
Defaulting Lender pursuant to Section 10.7 shall be applied at such time or
times as may be determined by the Administrative Agent as follows: first, to the
payment of any amounts owing by such Defaulting Lender to the Administrative
Agent hereunder; second, to the payment on a pro rata basis of any amounts owing
by such Defaulting Lender to the Issuing Bank or Swingline Lender hereunder;
third, to Cash Collateralize the Issuing Bank’s LC Exposure with respect to such
Defaulting Lender in accordance with Section 2.28(a); fourth, as the Borrowers
may request (so long as no Default or Event of Default exists), to the funding
of any Loan in respect of which such Defaulting Lender has failed to fund its
portion thereof as required by this Agreement, as determined by the
Administrative Agent; fifth, if so determined by the Administrative Agent and
the Borrowers, to be held in a deposit account and released pro rata in order to
(x) satisfy such Defaulting Lender’s potential future funding obligations with
respect to Loans under this Agreement and (y) Cash Collateralize the Issuing
Banks’

 

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future LC Exposure with respect to such Defaulting Lender with respect to future
Letters of Credit issued under this Agreement, in accordance with
Section 2.28(a); sixth, to the payment of any amounts owing to the Lenders, the
Issuing Bank or Swingline Lender as a result of any judgment of a court of
competent jurisdiction obtained by any Lender, the Issuing Bank or Swingline
Lender against such Defaulting Lender as a result of such Defaulting Lender’s
breach of its obligations under this Agreement; seventh, so long as no Default
or Event of Default exists, to the payment of any amounts owing to any Borrower
as a result of any judgment of a court of competent jurisdiction obtained by
such Borrower against such Defaulting Lender as a result of such Defaulting
Lender’s breach of its obligations under this Agreement; and eighth, to such
Defaulting Lender or as otherwise directed by a court of competent jurisdiction;
provided that if (x) such payment is a payment of the principal amount of any
Loans or LC Disbursements in respect of which such Defaulting Lender has not
fully funded its appropriate share, and (y) such Loans were made or the related
Letters of Credit were issued at a time when the conditions set forth in
Section 3.2 were satisfied or waived, such payment shall be applied solely to
pay the Loans of, and LC Disbursements owed to, all Non-Defaulting Lenders on a
pro rata basis before being applied to the payment of any Loans of, or LC
Disbursements owed to, such Defaulting Lender until such time as all Loans and
funded and unfunded participations in L/C Obligations and Swingline Loans are
held by the Lenders pro rata in accordance with the Commitments under the
applicable facility without giving effect to subsection (iv) below. Any
payments, prepayments or other amounts paid or payable to a Defaulting Lender
that are applied (or held) to pay amounts owed by a Defaulting Lender or to post
Cash Collateral pursuant to this Section 2.28(b)(ii) shall be deemed paid to and
redirected by such Defaulting Lender, and each Lender irrevocably consents
hereto.

 

(iii)

 

(A) No Defaulting Lender shall be entitled to receive any commitment fee
pursuant to Section 2.16(b) for any period during which that Lender is a
Defaulting Lender (and no Borrower shall be required to pay any such fee that
otherwise would have been required to have been paid to that Defaulting Lender).

 

(B)                               Each Defaulting Lender shall be entitled to
receive letter of credit fees pursuant to Section 2.16(c) for any period during
which that Lender is a Defaulting Lender only to the extent allocable to that
portion of its LC Exposure for which it has provided Cash Collateral pursuant to
Section 2.28(a).

 

(C)                               With respect to any  commitment fee or letter
of credit fee not required to be paid to any Defaulting Lender pursuant to
clause (A) or (B) above, each Borrower shall (x) pay to each Non-Defaulting
Lender that portion of any such fee otherwise payable to such Defaulting Lender
with respect to such Defaulting Lender’s participation in Letters of Credit or
Swingline Loans that has been reallocated to such Non-Defaulting Lender pursuant
to clause (iv) below, (y) to the extent not Cash Collateralized by the Borrowers
pursuant to the above provisions, pay to each Issuing Bank and Swingline Lender,
as applicable, the amount of any such fee otherwise payable to such Defaulting
Lender to the extent

 

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allocable to the Issuing Bank’s LC Exposure or Swingline Lender’s Swingline
Exposure with respect to such Defaulting Lender, and (z) not be required to pay
the remaining amount of any such fee.

 

(iv)                              All or any part of such Defaulting Lender’s
participation in Letters of Credit and Swingline Loans shall be reallocated
among the Non-Defaulting Lenders in accordance with their respective Pro Rata
Shares of the Revolving Commitments (calculated without regard to such
Defaulting Lender’s Revolving Commitment) but only to the extent that such
reallocation does not cause the Revolving Credit Exposure of any Non-Defaulting
Lender to exceed such Non-Defaulting Lender’s Revolving Commitment.  Subject to
Section 2.29, no reallocation hereunder shall constitute a waiver or release of
any claim of any party hereunder against a Defaulting Lender arising from that
Lender having become a Defaulting Lender, including any claim of a
Non-Defaulting Lender as a result of such Non-Defaulting Lender’s increased
exposure following such reallocation.

 

(v)                                 If the reallocation described in clause
(iv) above cannot, or can only partially, be effected, the Borrowers shall,
without prejudice to any right or remedy available to it hereunder or under law,
(x) first, prepay Swingline Loans in an amount equal to the Swingline Lender’s
Swingline Exposure with respect to such Defaulting Lender and (y) second, Cash
Collateralize the Issuing Banks’ LC Exposure with respect to such Defaulting
Lender in accordance with the procedures set forth in Section 2.28(a).

 

(c)                                  Defaulting Lender Cure.  If Parent, any
Borrower, the Administrative Agent, Swingline Lender and Issuing Bank agree in
writing that a Lender is no longer a Defaulting Lender, the Administrative Agent
will so notify the parties hereto, whereupon as of the effective date specified
in such notice and subject to any conditions set forth therein (which may
include arrangements with respect to any Cash Collateral), that Lender will, to
the extent applicable, purchase at par that portion of outstanding Loans of the
other Lenders or take such other actions as the Administrative Agent may
determine to be necessary to cause the Loans and funded and unfunded
participations in Letters of Credit and Swingline Loans to be held pro rata by
the Lenders in accordance with the applicable Commitments  (without giving
effect to Section 2.28(b)(iv)), whereupon such Lender will cease to be a
Defaulting Lender; provided that no adjustments will be made retroactively with
respect to fees accrued or payments made by or on behalf of the Borrowers while
that Lender was a Defaulting Lender; and provided, further, that except to the
extent otherwise expressly agreed by the affected parties, no change hereunder
from Defaulting Lender to Lender will constitute a waiver or release of any
claim of any party hereunder arising from that Lender’s having been a Defaulting
Lender.

 

(d)                                 New Swingline Loans/Letters of Credit.  So
long as any Lender is a Defaulting Lender, (i) the Swingline Lender shall not be
required to fund any Swingline Loans unless the Swingline Lender is satisfied
that the Swingline Lender will have no Swingline Exposure after giving effect to
such Swingline Loan and (ii) the Issuing Bank shall be required to issue,
extend, renew or increase any Letter of Credit unless the Issuing Bank is
satisfied that the Issuing Bank will have no LC Exposure after giving effect
thereto.

 

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Section 2.29.                         Acknowledgement and Consent to Bail-in of
EEA Financial Institutions . Notwithstanding anything to the contrary in any
Loan Document or in any other agreement, arrangement or understanding among any
such parties, each party hereto acknowledges that any liability of any EEA
Financial Institution arising under any Loan Document, to the extent such
liability is unsecured, may be subject to the write-down and conversion powers
of an EEA Resolution Authority and agrees and consents to, and acknowledges and
agrees to be bound by:

 

(a)                                 the application of any Write-Down and
Conversion Powers by an EEA Resolution Authority to any such liabilities arising
hereunder which may be payable to it by any party hereto that is an EEA
Financial Institution; and

 

(b)                                 the effects of any Bail-in Action on any
such liability, including, if applicable:

 

(i)                                     a reduction in full or in part or
cancellation of any such liability;

 

(ii)                                  a conversion of all, or a portion of, such
liability into shares or other instruments of ownership in such EEA Financial
Institution, its parent undertaking, or a bridge institution that may be issued
to it or otherwise conferred on it, and that such shares or other instruments of
ownership will be accepted by it in lieu of any rights with respect to any such
liability under this Agreement or any other Loan Document; or

 

(iii)                               the variation of the terms of such
liability  in connection with the exercise of the write-down and conversion
powers of any EEA Resolution Authority.

 

Section 2.30.                         Multiple Borrower Provisions .

 

(a)                                                                                
All Loans made to or on behalf of any Borrower and all of the other Obligations
of Borrowers, including all interest, fees, and expenses with respect thereto,
shall constitute one joint and several direct and general obligation of all
Borrowers and Guarantors.  Notwithstanding anything to the contrary contained
herein, each Borrower shall be jointly and severally, with each other Borrower,
directly and unconditionally liable to Administrative Agent and the Lenders for
all Obligations, it being understood that the Loans to each Borrower inure to
the benefit of all Borrowers, and that Administrative Agent is relying on the
joint and several liability of the Borrowers as co-makers and guarantors in
extending the Loans and issuing Letters of Credit hereunder.  Parent and each
other Borrower hereby unconditionally and irrevocably agree that upon default in
the payment when due (whether at stated maturity, by acceleration or otherwise)
of any principal of, or interest on, any Obligation payable to Administrative
Agent, it will forthwith pay the same, without notice or demand, unless such
payment is then prohibited by application of law (provided such Obligation shall
not be extinguished by any such prohibition).

 

(b)                                                                                
No payment or payments made by any Borrower or any other Person or received or
collected by Administrative Agent from any Borrower or any other Person by
virtue of any action or proceeding or any setoff or appropriation or application
at any time or from time to time in reduction of or in payment of the
Obligations shall be deemed to modify, reduce, release or otherwise affect the
liability of any Borrower under this Agreement (except  to the

 

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extent of such payment), and each Borrower shall remain liable for all of the
remaining Obligations until all of the Obligations are paid in full.

 

(c)                                                                                 
Each Borrower agrees that the Obligations will be paid strictly in accordance
with the terms of the Loan Documents, regardless of any law, regulation or order
now or hereafter in effect in any jurisdiction affecting any of such terms or
the rights of Administrative Agent with respect thereto, unless such payment is
then prohibited by applicable law (provided such Obligation shall not be
extinguished by any such prohibition).  All Obligations shall be conclusively
presumed to have been created in reliance hereon.  The Obligations and other
liabilities under this Agreement and the other Loan Documents shall be absolute
and unconditional irrespective of: (i) any lack of validity or enforceability of
any Loan Document or any other agreement or instrument relating thereto;
(ii) any change in the time, manner or place of payments of, or in any other
term of, all or any part of the Obligations, or any other amendment or waiver
thereof or any consent to departure therefrom, including any increase in the
Obligations resulting from the extension of additional credit to any Borrower or
otherwise; (iii) any taking, exchange, release of or non-perfection in any
Collateral, or any release or amendment or waiver of or consent to departure
from any guaranty for all or any of the Obligations; (iv) any change,
restructuring or termination of the corporate structure or existence of any
Borrower; or (v) any other circumstance which may otherwise constitute a defense
available to, or a discharge of, any Borrower.  This Agreement shall continue to
be effective or be reinstated, as the case may be, if at any time any payment of
any of the Obligations is rescinded or must otherwise be returned by
Administrative Agent upon the insolvency, bankruptcy or reorganization of any
Borrower or otherwise, all as though such payment had not been made.

 

(d)                                                                                
Each Borrower agrees that the joint and several liability of the Borrowers
provided for in this Agreement shall not be impaired or affected by any
modification, supplement, extension or amendment of any contract or agreement to
which one or more other Borrowers may hereafter agree (other than an agreement
signed by Administrative Agent specifically releasing such liability), nor by
any delay, extension of time, renewal, compromise or other indulgence granted by
Administrative Agent with respect to any of the Obligations, nor by any other
agreements or arrangements whatever with one or more other Borrowers or with any
other Person, each Borrower hereby waiving all notice of such delay, extension,
release, substitution, renewal, compromise or other indulgence, and hereby
consenting to be bound thereby as fully and effectually as if it had expressly
agreed thereto in advance.  The liability of each Borrower is direct and
unconditional as to all of the Obligations and may be enforced without requiring
Administrative Agent first to resort to any other right, remedy or security. 
Each Borrower hereby expressly waives promptness, diligence, notice of
acceptance and any other notice (except to the extent expressly provided for
herein or in another Loan Document) with respect to any of the Obligations, this
Agreement or any other Loan Document and any requirement that Administrative
Agent protect, secure, perfect or insure any Lien or any property subject
thereto or exhaust any right or take any action against any Borrower or any
other Person or any Collateral.

 

(e)                                                                                 
Each of the Parent and each Borrower hereby designates the Parent (“Borrower
Agent”) as its attorney, representative and agent and in its name and on its
behalf and as its act and deed or otherwise to execute and deliver all
documents, receive notices, and

 

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carry out all actions for all purposes under this Agreement and the other Loan
Documents, including requests for Loans and Letters of Credit, and the execution
and delivery of Notices of Borrowing, delivery or receipt of communications
(including any Notice of Revolving Borrowing, any telephonic or electronic mail
notice or request for a Borrowing, any request for the issuance of any Letter of
Credit), preparation and delivery of Borrowing Base Certificates and all
attachments thereto, financial reports and Compliance Certificates, receipt and
payment of Obligations, requests for waivers, amendments, or other
accommodations, actions under this Agreement and the other Loan Documents
(including in respect of compliance with covenants), and all other dealings with
Administrative Agent.  Borrower Agent hereby accepts such appointment. 
Administrative Agent may give any notice to, or communication with, any Loan
Party hereunder or under any other Loan Document to or with Borrower Agent on
behalf of such Loan Party.  Each of the Parent and each Borrower agrees that any
notice, election, communication, representation, agreement, or undertaking made
on its behalf by Borrower Agent shall be binding upon and enforceable against it
regardless of whether such Loan party was notified of the same before or after
the occurrence of the same.  Administrative Agent shall be entitled to rely
upon, and shall be fully protected in relying upon, the terms of this
Section 2.30(e).

 

ARTICLE III

 

CONDITIONS PRECEDENT TO LOANS AND LETTERS OF CREDIT

 

Section 3.1.                                Conditions to Effectiveness.  The
obligations of the Lenders (including the Swingline Lender) to make Loans and
the obligation of the Issuing Bank to issue any Letters of Credit hereunder
shall not become effective until the date on which each of the following
conditions is satisfied (or waived in accordance with Section 10.2):

 

(a)                                 The Administrative Agent shall have received
payment of all fees, expenses and other amounts due and payable on or before the
Closing Date, including, without limitation, reimbursement or payment of all
out-of-pocket expenses of the Administrative Agent, the Sole Lead Arranger and
their Affiliates (including reasonable fees, charges and disbursements of
counsel to the Administrative Agent) required to be reimbursed or paid by the
Borrowers hereunder, under any other Loan Document and under any agreement with
the Administrative Agent or the Sole Lead Arranger.

 

(b)                                 The Administrative Agent (or its counsel)
shall have received the following, each to be in form and substance satisfactory
to the Administrative Agent:

 

(i)                                     This Agreement, duly executed and
delivered by each Person party hereto;

 

(ii)                                  a certificate of the Secretary or
Assistant Secretary of each Loan Party, (A) certifying the name, title and true
signature of each officer of such Loan Party executing the Loan Documents to
which it is a party and (B) attaching and certifying copies of (1) such Loan
Party’s articles or certificate of incorporation, organization, or limited
partnership, or other registered organizational documents, each of which shall
have been certified as of a recent date by the secretary of state of the
jurisdiction issuing the same; (2) such Loan Party’s bylaws, partnership
agreement or limited liability company agreement; and (3) resolutions of such
Loan Party’s board of directors or other

 

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equivalent governing body, or comparable organizational documents and
authorizations, authorizing the execution, delivery and performance of the Loan
Documents to which it is a party;

 

(iii)                               certified copies of the articles or
certificate of incorporation, certificate of organization or limited
partnership, or other registered organizational documents of each Loan Party,
together with certificates of good standing or existence, as may be available
from the Secretary of State of the jurisdiction of organization of such Loan
Party;

 

(iv)                              a favorable written opinion of Ballard Spahr
LLP, counsel to the Loan Parties, addressed to the Administrative Agent, the
Issuing Bank, and each of the Lenders, and covering such matters relating to the
Loan Parties, the Loan Documents and the transactions contemplated therein as
the Administrative Agent or the Required Lenders shall reasonably request;

 

(v)                                 a certificate in the form of
Exhibit 3.1(b)(v), dated the Closing Date and signed by a Responsible Officer,
certifying that after giving effect to the funding of any initial Borrowing,
(x) no Default or Event of Default exists, (y) all representations and
warranties of each Loan Party set forth in the Loan Documents are true and
correct  in all material respects (other than those representations that are
expressly qualified by a Material Adverse Effect or other materiality qualifier,
in which case such representations and warranties are true and correct in all
respects) and (z) since the date of the financial statements of the Borrower
described in Section 4.4, there shall have been no change which has had or could
reasonably be expected to have a Material Adverse Effect;

 

(vi)                              [reserved];

 

(vii)                           certified copies of all consents, approvals,
authorizations, registrations and filings and orders required or advisable to be
made or obtained under any Requirement of Law, or by any Contractual Obligation
of any Loan Party, in connection with the execution, delivery, performance,
validity and enforceability of the Loan Documents or any of the transactions
contemplated thereby, and such consents, approvals, authorizations,
registrations, filings and orders shall be in full force and effect and all
applicable waiting periods shall have expired, and no investigation or inquiry
by any governmental authority regarding the Commitments or any transaction being
financed with the proceeds thereof shall be ongoing;

 

(viii)                        copies of (A) the internally prepared monthly
financial statements of the Parent and its Subsidiaries on a consolidated basis
for the calendar month ended April 30, 2016, (B) the audited consolidated and
financial statements for the Parent and its Subsidiaries for the Fiscal Year
ended March 30, 2014, March 29, 2015, and March 27, 2016, and (C) financial
projections on a monthly basis for the Fiscal Years ending on or about March 31,
2017, and annually thereafter through the end of the Fiscal Year ending on or
about March 31, 2021;

 

(ix)                              a certificate, dated the Closing Date and
signed by the chief financial officer of Parent, confirming that Parent and its
Subsidiaries, on a consolidated basis, are

 

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Solvent before and after giving effect to the consummation of the transactions
contemplated to occur on the Closing Date;

 

(x)                                 the Guaranty and Security Agreement, duly
executed by the Parent and each of its Domestic Subsidiaries, together with
(A) UCC financing statements and other applicable documents under the laws of
all necessary or appropriate jurisdictions with respect to the perfection of the
Liens granted under the Guaranty and Security Agreement, as requested by the
Administrative Agent in order to perfect such Liens, duly authorized by the Loan
Parties, (B) copies of favorable UCC, tax, judgment and fixture lien search
reports in all necessary or appropriate jurisdictions and under all legal and
trade names of the Loan Parties as requested by the Administrative Agent,
indicating that there are no prior Liens on any of the Collateral other than
Permitted Encumbrances and Liens to be released on the Closing Date, and (C) an
Information Certificate, duly completed and executed by each Loan Party;

 

(xi)                              Control Account Agreements with respect to
each of the Loan Parties’ deposit accounts, duly executed by each depository
Bank and the applicable Loan Party;

 

(xii)                           [reserved];

 

(xiii)                        copies of duly executed payoff letters, in form
and substance satisfactory to the Administrative Agent, executed by each of the
Existing Lenders, together with, (A) if applicable, UCC-3 or other appropriate
termination statements, in form and substance satisfactory to the Administrative
Agent, releasing all liens of the Existing Lenders upon any of the personal
property of the Loan Parties and (B) any other releases, terminations, or other
documents reasonably required by the Administrative Agent to evidence the payoff
of Indebtedness owed to the Existing Lenders;

 

(xiv)                       a duly completed and executed Borrowing Base
Certificate; and

 

(xv)                          certificates of insurance, in form and detail
acceptable to the Administrative Agent, describing the types and amounts of
insurance (property and liability) maintained by any of the Loan Parties, in
each case naming the Administrative Agent as lender’s loss payee or additional
insured, as the case may be, together with a lender’s loss payable endorsement
in form and substance satisfactory to the Administrative Agent.

 

(c)                                  Agent shall have determined that
Availability as of the Closing Date, after giving effect to the any initial
Revolving Loans (and any Revolving Loans to be made and Letters of Credit to be
issued on the Closing Date), less trade accounts payable which are past due
(based on the Borrowers’ historical practices before the Closing Date) equals or
exceeds $20,000,000.

 

(d)                                 Administrative Agent shall have received
background checks with respect to each Loan Party and its management and owners
and such other information relating to “know your customer” rules and
regulations, in each case, as Administrative Agent shall have required and
Administrative Agent shall have found the same satisfactory in all respects.

 

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(e)                                  No less than five Business Days before the
Closing Date, Administrative Agent shall have received such information and
materials as it shall have requested to complete, as to each Loan Party and its
management and owners, all background checks and “know your customer”
regulations and policies.

 

(f)                                   Agent shall have completed all legal and
business diligence regarding the Loan Parties and found the results thereof
satisfactory in all respects.

 

(g)                                  Administrative Agent shall have obtained
its final internal credit approval.

 

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

 

Section 3.2.                                Conditions to Each Credit Event. 
The obligation of each Lender to make a Loan on the occasion of any Borrowing
and of the Issuing Bank to issue, amend, renew or extend any Letter of Credit is
subject to Section 2.28(c) and the satisfaction of the following conditions:

 

(a)                                 at the time of and immediately after giving
effect to such Borrowing or the issuance, amendment, renewal or extension of
such Letter of Credit, as applicable, no Default or Event of Default shall
exist;

 

(b)                                 at the time of and immediately after giving
effect to such Borrowing or the issuance, amendment, renewal or extension of
such Letter of Credit, as applicable, all representations and warranties of each
Loan Party set forth in the Loan Documents shall be true and correct in all
material respects (other than those representations and warranties that are
expressly qualified by a Material Adverse Effect or other materiality qualifier,
in which case such representations and warranties shall be true and correct in
all respects) (except to the extent that such representations and warranties
relate to an earlier date in which case such representations and warranties that
expressly relate to an earlier date are true and correct, in the case of such
representations and warranties qualified by a Material Adverse Effect or other
materiality qualifier, in all respects, and otherwise in all material respects,
as of such earlier date);

 

(c)                                  since March 27, 2016, there shall have been
no change which has had or could reasonably be expected to have a Material
Adverse Effect;

 

(d)                                 the Borrower shall have delivered the
required Notice of Revolving Borrowing;

 

(e)                                  after giving effect to any Borrowing or the
issuance of any Letter of Credit, Availability shall not be less than zero; and

 

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(f)                                   the Administrative Agent shall have
received such other documents, certificates, information or legal opinions as
the Administrative Agent may reasonably request, all in form and substance
reasonably satisfactory to the Administrative Agent.

 

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

 

Section 3.3.                                Delivery of Documents.  All of the
Loan Documents, certificates, legal opinions and other documents and papers
referred to in this Article, unless otherwise specified, shall be delivered to
the Administrative Agent for the account of each of the Lenders and in
sufficient counterparts or copies for each of the Lenders and shall be in form
and substance satisfactory in all respects to the Administrative Agent

 

ARTICLE IV

 

REPRESENTATIONS AND WARRANTIES

 

Each of the Parent and each Borrower represents and warrants to the
Administrative Agent, each Lender and the Issuing Bank as follows:

 

Section 4.1.                                Existence; Power.  Each of the
Parent and each Borrower (i) is duly organized, validly existing and in good
standing as a corporation, partnership or limited liability company under the
laws of the jurisdiction of its organization, (ii) has all requisite power and
authority to carry on its business as now conducted, and (iii) is duly qualified
to do business, and is in good standing, in each jurisdiction where such
qualification is required, except where a failure to be so qualified  or in good
standing (other than in its jurisdiction of organization) could not reasonably
be expected to result in a Material Adverse Effect.

 

Section 4.2.                                Organizational Power;
Authorization.  The execution, delivery and performance by each Loan Party of
the Loan Documents to which it is a party are within such Loan Party’s
organizational powers and have been duly authorized by all necessary
organizational and, if required, shareholder, partner or member action.  This
Agreement has been duly executed and delivered by the Parent and each Borrower
and constitutes, and each other Loan Document to which any Loan Party is a
party, when executed and delivered by such Loan Party, will constitute, valid
and binding obligations of the Parent, each Borrower, or such Loan Party (as the
case may be), enforceable against it in accordance with their respective terms,
except as may be limited by applicable bankruptcy, insolvency, reorganization,
moratorium or similar laws affecting the enforcement of creditors’ rights
generally and by general principles of equity.

 

Section 4.3.                                Governmental Approvals; No
Conflicts.  The execution, delivery and performance by each Loan Party of the
Loan Documents to which it is a party (a) do not require any consent or approval
of, registration or filing with, or any action by, any Governmental Authority,
except those as have been obtained or made and are in full force and effect and
except for filings necessary to perfect or maintain perfection of the Liens
created under the Loan Documents, (b) will not violate any Requirement of Law
applicable to the Parent or any of its Subsidiaries or any judgment, order or
ruling of any Governmental Authority, (c) will not violate

 

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or result in a default under any material Contractual Obligation of the Parent
or any of its Subsidiaries or any of its assets or give rise to a right
thereunder to require any material payment to be made by the Parent or any of
its Subsidiaries and (d) will not result in the creation or imposition of any
Lien on any asset of the Parent or any of its Subsidiaries, except Liens (if
any) created under the Loan Documents.

 

Section 4.4.                                Financial Statements.  The Parent
has furnished to each Lender (i) the audited consolidated balance sheet of the
Parent and its Subsidiaries as of March 27, 2016, and the related audited
consolidated statements of income, shareholders’ equity and cash flows for the
Fiscal Year then ended, prepared by Ernst & Young, LLP, and (ii) the unaudited
consolidated balance sheet of the Parent and its Subsidiaries as of April 30,
2016, and the related unaudited consolidated statements of income and cash flows
for the Fiscal Month and year-to-date period then ended, certified by a
Responsible Officer.  Such financial statements fairly present, in all material
respects, the consolidated financial condition of the Parent and its
Subsidiaries as of such dates and the consolidated results of operations for
such periods in conformity with GAAP consistently applied, subject to year-end
audit adjustments and the absence of footnotes in the case of the statements
referred to in clause (ii).  Since March 27, 2016, there have been no changes
with respect to the Parent and its Subsidiaries which have had or could
reasonably be expected to have, either individually or in the aggregate, a
Material Adverse Effect.

 

Section 4.5.                                Litigation and Environmental
Matters.

 

(a)                                 No litigation, investigation or proceeding
of or before any arbitrators or Governmental Authorities is pending against or,
to the knowledge of the Parent and its Subsidiaries, threatened against or
affecting the Parent or any of its Subsidiaries (i) as to which there is a
reasonable possibility of an adverse determination that could reasonably be
expected to have, either individually or in the aggregate, a Material Adverse
Effect or (ii) which in any manner draws into question the validity or
enforceability of this Agreement or any other Loan Document.

 

(b)                                 Except for the matters set forth on Schedule
4.5, none of the Parent nor any of its Subsidiaries (i) has failed to comply
with any Environmental Law or to obtain, maintain or comply with any permit,
license or other approval required under any Environmental Law, (ii) has become
subject to any Environmental Liability, (iii) has received notice of any claim
with respect to any Environmental Liability or (iv) knows of any basis for any
Environmental Liability except, in each case, as could not reasonably be
expected to have, individually or in the aggregate, a Material Adverse Effect.

 

Section 4.6.                                Compliance with Laws and
Agreements.  The Parent and each of its Subsidiaries is in compliance with
(a) all Requirements of Law and all judgments, decrees and orders of any
Governmental Authority and (b) all indentures, agreements or other instruments
binding upon it or its properties, except in each case where non-compliance,
either individually or in the aggregate, could not reasonably be expected to
result in a Material Adverse Effect.

 

Section 4.7.                                Investment Company Act.  None of the
Parent nor any of its Subsidiaries is (a) an “investment company” or is
“controlled” by an “investment company,” as such terms are defined in, or
subject to regulation under, the Investment Company Act of 1940, as amended and
in effect from time to time, or (b) otherwise subject to any other regulatory
scheme limiting

 

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its ability to incur debt or requiring any approval or consent from, or
registration or filing with, any Governmental Authority in connection therewith.

 

Section 4.8.                                Taxes.  The Parent and its
Subsidiaries and each other Person for whose taxes the Parent or any of its
Subsidiaries could become liable (a) have timely filed or caused to be filed all
Federal income tax returns and all other material tax returns that are required
to be filed by them, and have paid all taxes shown to be due and payable on such
returns and (b) have paid  all assessments made against it or its property and
all other taxes, fees or other charges imposed on it or any of its property by
any Governmental Authority, except where the same are currently being contested
in good faith by appropriate proceedings and for which the Parent or such
Subsidiary, as the case may be, has set aside on its books adequate reserves in
accordance with GAAP or, in the case of clause (b), where the failure to make
such payment could not reasonably be expected to have a Material Adverse
Effect.  The charges, accruals and reserves on the books of the Parent and its
Subsidiaries in respect of such taxes are adequate, and no tax liabilities that
could be materially in excess of the amount so provided are anticipated.

 

Section 4.9.                                Margin Regulations.  None of the
proceeds of any of the Loans or Letters of Credit will be used, directly or
indirectly, for “purchasing” or “carrying” any “margin stock” within the
respective meanings of each of such terms under Regulation U or for any purpose
that violates the provisions of Regulation T, Regulation U or Regulation X.
 None of the Parent nor any of its Subsidiaries is engaged principally, or as
one of its important activities, in the business of extending credit for the
purpose of purchasing or carrying “margin stock.”

 

Section 4.10.                         ERISA.  Each Benefit Arrangement and Plan
is in substantial compliance in form and operation with its terms and with ERISA
and the Code (including, without limitation, the Code provisions compliance with
which is necessary for any intended favorable tax treatment) and all other
applicable laws and regulations.  Each Benefit Arrangement and Plan (and each
related trust, if any) which is intended to be qualified under Section 401(a) of
the Code has received a favorable determination letter from the Internal Revenue
Service to the effect that it meets the requirements of Sections 401(a) and
501(a) of the Code covering all applicable tax law changes, or is comprised of a
master or prototype plan that has received a favorable opinion letter from the
Internal Revenue Service, and nothing has occurred since the date of such
determination that would adversely affect such determination (or, in the case of
a Benefit Arrangement or Plan with no determination, nothing has occurred that
would adversely affect the issuance of a favorable determination letter or
otherwise adversely affect such qualification).  No ERISA Event has occurred or
is reasonably expected to occur with respect to a Plan.  There exists no
Unfunded Pension Liability with respect to any Plan.  None of the Parent, any of
its Subsidiaries, or any ERISA Affiliate is making or accruing an obligation to
make contributions, or has, within any of the five calendar years immediately
preceding the date this assurance is given or deemed given, made or accrued an
obligation to make, contributions to any Multiemployer Plan.  There are no
actions, suits or claims pending against or involving a Benefit Arrangement or
Plan (other than routine claims for benefits) or, to the knowledge of the
Parent, any of its Subsidiaries, or any ERISA Affiliate, threatened, which would
reasonably be expected to be asserted successfully against such Benefit
Arrangement or Plan and, if so asserted successfully, would reasonably be
expected either singly or in the aggregate to result in liability to the Parent
or any of its Subsidiaries.  The Parent, each of its Subsidiaries, and each
ERISA Affiliate have made all contributions to or under each Plan and
Multiemployer Plan required by

 

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law within the applicable time limits prescribed thereby, by the terms of such
Plan or Multiemployer Plan, respectively, or by any contract or agreement
requiring contributions to a Plan or Multiemployer Plan.  No Plan has applied
for or received an extension of any amortization period within the meaning of
Section 412 of the Code or Section 303 or 304 of ERISA.  None of the Parent, any
of its Subsidiaries, or any ERISA Affiliate have ceased operations at a facility
so as to become subject to the provisions of Section 4068(a) of ERISA, withdrawn
as a substantial employer so as to become subject to the provisions of
Section 4063 of ERISA or ceased making contributions to any Plan subject to
Section 4064(a) of ERISA to which it made contributions.  Each Non-U.S. Plan has
been maintained in substantial compliance with its terms and with the
requirements of any and all applicable laws, statutes, rules, regulations and
orders and has been maintained, where required, in good standing with applicable
regulatory authorities, except as would not reasonably be expected to result in
liability to the Parent or any of its Subsidiaries.  All contributions required
to be made with respect to a Non-U.S. Plan have been timely made.  None of the
Parent nor any of its Subsidiaries has incurred any obligation in connection
with the termination of, or withdrawal from, any Non-U.S. Plan.  The present
value of the accrued benefit liabilities (whether or not vested) under each
Non-U.S. Plan, determined as of the end of the Parent’s most recently ended
fiscal year on the basis of reasonable actuarial assumptions, did not exceed the
current value of the assets of such Non-U.S. Plan allocable to such benefit
liabilities.

 

Section 4.11.                         Ownership of Property; Insurance.

 

(a)                                 Each of the Parent and each of its
Subsidiaries has good title to, or valid leasehold interests in, all of its real
and personal property material to the operation of its business, including all
such properties reflected in the most recent audited consolidated balance sheet
of the Parent referred to in Section 4.4 or purported to have been acquired by
the Parent or any of its Subsidiaries after said date (except as sold or
otherwise disposed of in the ordinary course of business and except for minor
defects in title that do not interfere with its ability to conduct its business
as currently conducted or to utilize such properties for their intended
purposes), in each case free and clear of Liens (other than Permitted Liens). 
All leases that individually or in the aggregate are material to the business or
operations of the Parent and its Subsidiaries are valid and subsisting and are
in full force.

 

(b)                                 Each of the Parent and each of its
Subsidiaries owns, or is licensed or otherwise has the right to use, all
patents, trademarks, service marks, trade names, copyrights and other
intellectual property material to its business, and the use thereof by the
Parent and its Subsidiaries does not infringe the rights of any other Person, in
each case except to the extent any such failure and/or infringement,
individually or the aggregate could not reasonably be expected to have a
Material Adverse Effect.

 

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

 

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(d)                                 Schedule 4.11 sets forth all Real Estate
owned or leased by any Loan Parties as of the Closing Date.

 

Section 4.12.                         Disclosure.  As of the Closing Date, the
Parent has disclosed to the Administrative Agent all agreements, instruments,
and corporate or other restrictions to which the Parent or any of its
Subsidiaries is subject, and all other matters known to any of them, that,
either individually or in the aggregate, could reasonably be expected to result
in a Material Adverse Effect.  Neither any Information Certificate nor any of
the reports (including, without limitation, all reports that the Parent is
required to file with the Securities and Exchange Commission), financial
statements, certificates or other information furnished by or on behalf of the
Parent to the Administrative Agent in connection with the negotiation or
syndication of this Agreement or any other Loan Document or delivered hereunder
or thereunder (as modified or supplemented by any other information so
furnished) contains any material misstatement of fact or omits to state any
material fact necessary to make the statements therein, taken as a whole in
light of the circumstances under which they were made, not misleading; provided
that, with respect to projected financial information, each of the Parent and
each Borrower represents only that such information was prepared in good faith
based upon assumptions believed to be reasonable at the time.

 

Section 4.13.                         Labor Relations.  There are no strikes,
lockouts or other material labor disputes or grievances against the Parent or
any of its Subsidiaries, or, to the Parent’s knowledge, threatened against or
affecting the Parent or any of its Subsidiaries, and no significant unfair labor
practice charges or grievances are pending against the Parent or any of its
Subsidiaries, or, to the Parent’s knowledge, threatened against any of them
before any Governmental Authority.  All payments due from the Parent or any of
its Subsidiaries pursuant to the provisions of any collective bargaining
agreement have been paid or accrued as a liability on the books of the Parent or
any such Subsidiary, except where the failure to do so could not reasonably be
expected to have a Material Adverse Effect.

 

Section 4.14.                         Subsidiaries.  Schedule 4.14 sets forth
the name of, the ownership interest of each Loan Party in, the jurisdiction of
incorporation or organization of such Loan Party, and the type of each
Subsidiary of the Parent and the other Loan Parties and identifies each
Subsidiary that is a Borrower or Subsidiary Loan Party, in each case as of the
Closing Date.

 

Section 4.15.                         Solvency.  Parent and its Subsidiaries, on
a consolidated basis, are Solvent.

 

Section 4.16.                         Deposit Accounts.  Schedule 4.16 lists all
of the Loan Parties’ deposit accounts (including each Collections Account and
Concentration Account), lockbox accounts, or other similar deposit accounts as
of the Closing Date, and such Schedule correctly identifies, as to each such
deposit account, the name, address, and telephone number of the financial
institution at which such deposit account is maintained, the name in which such
deposit account is held, the type of such deposit account, whether such deposit
account is a Collections Account, a Concentration Account, or otherwise, and the
complete account number therefor.

 

Section 4.17.                         Collateral Documents. The Guaranty and
Security Agreement is effective to create in favor of the Administrative Agent
for the ratable benefit of the Secured Parties a legal, valid and enforceable
security interest in the Collateral (as defined therein) to the extent a

 

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security interest therein can be created under Article 9 of the UCC, and when
UCC financing statements in appropriate form are filed in the offices specified
on Schedule 3 to the Guaranty and Security Agreement, the Guaranty and Security
Agreement shall constitute a fully perfected Lien (to the extent that such Lien
may be perfected by the filing of a UCC financing statement) on, and security
interest in, all right, title and interest of the grantors thereunder in such
Collateral, in each case prior and superior in right to any other Person (other
than with respect to Permitted Liens).

 

Section 4.18.                         [Reserved.]

 

Section 4.19.                         Material Agreements.  As of the Closing
Date, all Material Agreements of the Parent and its Subsidiaries (other than the
Loan Documents) are described on Schedule 4.19, and each such Material Agreement
is in full force and effect.  As of the Closing Date, the Parent does not have
any knowledge of any pending amendments or threatened termination of any of the
Material Agreements.  As of the Closing Date, the Parent has delivered to the
Administrative Agent a true, complete and correct copy of each Material
Agreement (including all schedules, exhibits, amendments, supplements,
modifications, assignments and all other documents delivered pursuant thereto or
in connection therewith).

 

Section 4.20.                         Anti-Corruption Laws and Sanctions.  The
Parent has implemented and maintains in effect policies and procedures designed
to promote compliance in all material respects by the Parent, its Subsidiaries,
and each of their respective directors, officers, employees and agents with
Anti-Corruption Laws and applicable Sanctions, and the Parent, its Subsidiaries,
and each of their respective directors, officers and employees and, to the
knowledge of the Parent, its agents, are in compliance with Anti-Corruption Laws
and applicable Sanctions.  None of (a) the Parent, any Subsidiary or any of
their respective directors, officers or employees, or (b) to the knowledge of
the Parent, any agent of the Parent, or any Subsidiary that will act in any
capacity in connection with or benefit from the credit facilities established
hereby, is a Sanctioned Person.  No Borrowing or Letter of Credit, use of
proceeds or other transactions will violate Anti-Corruption Laws or applicable
Sanctions.

 

Section 4.21.                         Representations and Warranties Relating to
Accounts. As to each Account that was included by such Borrower as an Eligible
Account in the most recent Borrowing Base Certificate submitted to the
Administrative Agent by the Borrower Agent, such Account was not ineligible (to
the Borrowers’ knowledge with respect to any Account deemed ineligible by the
Administrative Agent in the exercise of its Permitted Discretion) by virtue of
one or more of the excluding criteria set forth in the definition of Eligible
Accounts as of the date of such Borrowing Base Certificate.

 

Section 4.22.                         Certain Representations and Warranties
Relating to National Air Time.  National Air Time (a) owns no assets having an
aggregate fair market value in excess of $25,000, (b) does not have liabilities
in excess of $25,000, and (c) has ceased conducting regular business and
conducts no business other than business directly related to its liquidation and
dissolution.

 

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ARTICLE V

 

AFFIRMATIVE COVENANTS

 

Until the Commitments have expired or been terminated and all Obligations have
been paid in full  (except for inchoate or contingent indemnification
obligations for which no claim has been made or threatened) and all Letters of
Credit shall have expired or terminated, in each case without any pending draw,
or all such Letters of Credit shall have been cash collateralized to the
satisfaction of the Issuing Bank, and all LC Disbursements shall have been
reimbursed, each of the Parent and each Borrower covenants and agrees with the
Lenders that:

 

Section 5.1.                                Financial Statements and Other
Information.  The Borrower Agent will deliver to the Administrative Agent and
each Lender:

 

(a)                                 as soon as available and in any event within
90 days after the end of each Fiscal Year of the Parent, a copy of the annual
audited report for such Fiscal Year for the Parent and its Subsidiaries,
containing a consolidated balance sheet of the Parent and its Subsidiaries as of
the end of such Fiscal Year and the related consolidated statements of income,
stockholders’ equity and cash flows (together with all footnotes thereto) of the
Parent and its Subsidiaries for such Fiscal Year, setting forth in each case in
comparative form the figures for the previous Fiscal Year, all in reasonable
detail and reported on by Ernst & Young, LLP, or other independent public
accountants of nationally recognized standing (without a “going concern” or like
qualification, exception or explanation and without any qualification or
exception as to the scope of such audit) to the effect that such financial
statements present fairly in all material respects the financial condition and
the results of operations of the Parent and its Subsidiaries for such Fiscal
Year on a consolidated basis in accordance with GAAP and that the examination by
such accountants in connection with such consolidated financial statements has
been made in accordance with generally accepted auditing standards; provided,
that so long as the Parent is required to file periodic reports under
Section 13(a) or Section 15(d) of the Exchange Act, the Borrower Agent may
satisfy its obligation to deliver the financial statements referred to in this
clause (a) by delivering such financial statements by electronic mail to such
e-mail addresses as the Administrative Agent and the Lenders shall have provided
to the Borrower Agent from time to time;

 

(b)                                 [reserved];

 

(c)                                  as soon as available and in any event
within 30 days after the end of each Fiscal Month (or 45 days after the end of
the last Fiscal Month of each Fiscal Quarter) other than the last Fiscal Month
of a Fiscal Year, an unaudited consolidated balance sheet of the Parent and its
Subsidiaries as of the end of such Fiscal Month and the related unaudited
consolidated statements of income of the Parent and its Subsidiaries for such
Fiscal Month and the then elapsed portion of such Fiscal Year, setting forth in
each case in comparative form the figures for the corresponding Fiscal Month and
the corresponding portion of the Parent’s previous Fiscal Year and the
corresponding figures for the budget for the current Fiscal Year;

 

(d)                                 concurrently with the delivery of the
financial statements referred to in subsections (a) and (c) of this
Section (other than the financial statements for last Fiscal Month of each
Fiscal Year delivered pursuant to subsection (c) of this Section), a Compliance

 

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Certificate signed by the principal executive officer or the principal financial
officer of the Parent (i) certifying as to whether there exists a Default or
Event of Default on the date of such certificate and, if a Default or an Event
of Default then exists, specifying the details thereof and the action which the
Parent has taken or proposes to take with respect thereto, (ii) setting forth in
reasonable detail calculations of the financial covenants set forth in
Article VI (provided, that the financial covenants will not be tested except as
provided in Article VI), (iii) specifying any change in the identity of the
Subsidiaries as of the end of such Fiscal Year or Fiscal Month from the
Subsidiaries identified to the Lenders on the Closing Date or as of the most
recent Fiscal Year or Fiscal Month, as the case may be, and (iv) stating whether
any change in GAAP or the application thereof has occurred since the date of the
mostly recently delivered audited financial statements of the Parent and its
Subsidiaries, and, if any change has occurred, specifying the effect of such
change on the financial statements accompanying such Compliance Certificate;

 

(e)                                  to the extent otherwise obtained by the
Borrowers, concurrently with the delivery of the financial statements referred
to in subsection (a) above, a certificate of the accounting firm that reported
on such financial statements stating whether they obtained any knowledge during
the course of their examination of such financial statements of any Default or
Event of Default (which certificate may be limited to the extent required by
accounting rules or guidelines);

 

(f)                                   as soon as available and in any event
within 30 days after the beginning of each Fiscal Year (commencing with the
Fiscal Year ending on or about March 31, 2018), forecasts and a pro forma budget
for such Fiscal Year (prepared on a monthly basis) and each other Fiscal Year
which commences before the Revolving Commitment Termination Date (prepared on an
annual basis), each containing an income statement, balance sheet and statement
of cash flow for the applicable period covered thereby;

 

(g)                                  promptly upon Administrative Agent’s
request from time to time, an updated Information Certificate for each Loan
Party;

 

(h)                                 promptly after the same become publicly
available, copies of all periodic and other reports, proxy statements and other
materials filed with the Securities and Exchange Commission, or any Governmental
Authority succeeding to any or all functions of said Commission, or with any
national securities exchange, or distributed by the Parent to its shareholders
generally, as the case may be (provided, however, that items to be delivered
pursuant to this clause shall be deemed to have been delivered on the date on
which such documents are filed for public availability on the SEC’s Electronic
Data Gathering and Retrieval System, so long as the Borrower Agent shall have
notified (which may be by facsimile or electronic mail) Administrative Agent of
the filing of any such documents); and

 

(i)                                     promptly following any request therefor,
such other information regarding the results of operations, business affairs and
financial condition of the Parent or any of its Subsidiaries as the
Administrative Agent or any Lender may reasonably request;

 

(j)                                    within 30 days after the end of each
Fiscal Month, the Borrower Agent shall deliver to the Administrative Agent, a
Borrowing Base Certificate as of the last day of the immediately preceding
Fiscal Month, which shall be in such form as shall be  reasonably satisfactory
to the Administrative Agent, setting forth a categorical breakdown of all
Accounts of each Loan Party and a calculation of Eligible Accounts as of such
last day of the preceding

 

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Fiscal Month; provided, however, during an Increased Reporting Period, the
Borrower Agent shall instead provide the Borrowing Base Certificates and other
information required by this Section 5.1(j) on a weekly basis, no later than
three Business Days after the end of each calendar week or with such other
frequency as may be required by the Administrative Agent from time to time;

 

(k)                                 within 30 days after the end of each Fiscal
Month, Borrower Agent shall deliver to the Administrative Agent, in form
reasonably acceptable to the Administrative Agent, (A) a report of sales,
collections, debit and credit adjustments and (B) a detailed aged trial balance
of all Accounts of each Loan Party existing as of the last day of the preceding
Fiscal Month, specifying the names, and face value for each Account Debtor
obligated on an Account of such Loan Party so listed and all other information
necessary to calculate Eligible Accounts as of such last day of the preceding
Fiscal Month or such other date reasonably required by the Administrative Agent;
provided, however, during an Increased Reporting Period, the Borrower Agent
shall instead provide such reports and other information required by this
Section 5.1(k) on a weekly or more frequent basis as may be requested by
Administrative Agent from time to time; and

 

(l)                                     upon request by the Administrative
Agent, the Borrower Agent shall deliver to the Administrative Agent, in form
reasonably acceptable to the Administrative Agent, (A) lockbox, bank and
investment account statements and (B) copies of proof of delivery and the
original  or an accurate facsimile copy of all documents, including repayment
histories and present status reports relating to the Accounts of each Loan Party
so scheduled and such other matters and information relating to the status of
then existing Accounts of each Loan Party as the Administrative Agent shall
reasonably request.

 

Section 5.2.                                Notices of Material Events.  The
Borrower Agent will furnish to the Administrative Agent and each Lender prompt
written notice of the following:

 

(a)                                 the occurrence of any Default or Event of
Default;

 

(b)                                 the filing or commencement of, or any
material development in, any action, suit or proceeding by or before any
arbitrator or Governmental Authority against or, to the knowledge of the Parent
or any Borrower, affecting the Parent or any of its Subsidiaries which, if
adversely determined, could reasonably be expected to result in a Material
Adverse Effect;

 

(c)                                  promptly after becoming aware thereof, the
occurrence of any event or any other development by which the Parent or any of
its Subsidiaries (i) fails to comply with any Environmental Law or to obtain,
maintain or comply with any permit, license or other approval required under any
Environmental Law, (ii) becomes subject to any Environmental Liability,
(iii) receives notice of any claim with respect to any Environmental Liability,
or (iv) becomes aware of any basis for any Environmental Liability, in each case
which, either individually or in the aggregate, could reasonably be expected to
result in a Material Adverse Effect;

 

(d)                                 promptly and in any event within 15 days
after (i) the Parent, any of its Subsidiaries or any ERISA Affiliate knows or
has reason to know that any ERISA Event has occurred, a certificate of the chief
financial officer of the Parent describing such ERISA Event and the action, if
any, proposed to be taken with respect to such ERISA Event and a copy of any

 

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notice filed with the PBGC or the IRS pertaining to such ERISA Event and any
notices received by the Parent, such Subsidiary or such ERISA Affiliate from the
PBGC or any other governmental agency with respect thereto, and (ii) becoming
aware (1) that there has been an increase in Unfunded Pension Liabilities (not
taking into account Plans with negative Unfunded Pension Liabilities) since the
date the representations hereunder are given or deemed given, or from any prior
notice, as applicable, (2) of the existence of any Withdrawal Liability, (3) of
the adoption of, or the commencement of contributions to, any Plan subject to
Section 412 of the Code by the Parent, any of its Subsidiaries or any ERISA
Affiliate, or (4) of the adoption of any amendment to a Plan subject to
Section 412 of the Code which results in a material increase in contribution
obligations of the Parent, any of its Subsidiaries or any ERISA Affiliate, a
detailed written description thereof from the chief financial officer of the
Parent;

 

(e)                                  promptly after becoming aware thereof, the
occurrence of any default or event of default, or the receipt by the Parent or
any of its Subsidiaries of any written notice of an alleged default or event of
default, with respect to any Material Indebtedness of the Parent or any of its
Subsidiaries;

 

(f)                                   any material amendment or modification to
any Material Agreement (together with a copy thereof), and prompt notice of any
termination, expiration or loss of any Material Agreement that, individually or
in the aggregate, could reasonably be expected to result in a reduction in
revenue or Consolidated EBITDA of the Loan Parties of 10% or more on a
consolidated basis from the prior Fiscal Year;

 

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

 

(h)                                 The Borrower Agent will furnish to the
Administrative Agent at least 30 days before (or such shorter period as shall be
agreed by the Administrative Agent), notice of any change (i) in any Loan
Party’s legal name, (ii) in any Loan Party’s chief executive office, its
principal place of business, any office in which it maintains books or records
or any office or facility at which Collateral owned by it is located (including
the establishment of any such new office or facility), (iii) in any Loan Party’s
identity or legal structure, (iv) in any Loan Party’s federal taxpayer
identification number or organizational number or (v) in any Loan Party’s
jurisdiction of organization.

 

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

 

Section 5.3.                                Existence; Conduct of Business.  The
Parent shall, and shall cause each of its Subsidiaries to, do or cause to be
done all things necessary to preserve, renew and maintain in full force and
effect its legal existence and its respective rights, licenses, permits,
privileges, franchises, patents, copyrights, trademarks and trade names material
to the conduct of its business; provided that nothing in this Section shall
prohibit any merger, consolidation, liquidation or dissolution permitted under
Section 7.3.

 

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Section 5.4.                                Compliance with Laws.  The Parent
shall, and shall cause each of its Subsidiaries to, comply with all laws, rules,
regulations and requirements of any Governmental Authority applicable to its
business and properties, including, without limitation, all Environmental Laws,
ERISA and OSHA, except where the failure to do so, either individually or in the
aggregate, could not reasonably be expected to result in a Material Adverse
Effect.

 

Section 5.5.                                Payment of Obligations.  The Parent
shall, and shall cause each of its Subsidiaries to, pay and discharge at or
before maturity all of its obligations and liabilities (including, without
limitation, all taxes, assessments and other governmental charges, levies and
all other claims that could result in a statutory Lien) before the same shall
become delinquent or in default (as determined by reference to the Parent and
its Subsidiaries’ historical practices), except where (a) the validity or amount
thereof is being contested in good faith by appropriate proceedings, (b) the
Parent, such Borrower, or such Subsidiary has set aside on its books adequate
reserves with respect thereto in accordance with GAAP and (c) the failure to
make payment pending such contest could not reasonably be expected to result in
a Material Adverse Effect.

 

Section 5.6.                                Books and Records.  The Parent
shall, and shall cause each of its Subsidiaries to, keep proper books of record
and account in which full, true and correct entries shall be made of all
dealings and transactions in relation to its business and activities to the
extent necessary to prepare the consolidated financial statements of the Parent
in conformity with GAAP.

 

Section 5.7.                                Visitation and Inspection.

 

(a)                                 The Parent shall, and shall cause each of
its Subsidiaries to, permit any representative of the Administrative Agent or
any Lender to visit and inspect its properties, to examine its books and records
and to make copies and take extracts therefrom, and to discuss its affairs,
finances and accounts with any of its officers and with its independent
certified public accountants, all at such reasonable times and as often as the
Administrative Agent or any Lender may reasonably request after reasonable prior
notice to the Borrower Agent; provided that if an Event of Default has occurred
and is continuing, no prior notice shall be required.

 

(b)                                 Absent the existence of any Event of
Default, Borrowers shall be required to pay for the costs and expenses of only
one field examination per calendar year (plus one additional field examination
per Fiscal Year if commenced during any Cash Dominion Period).

 

Section 5.8.                                Maintenance of Properties;
Insurance.  The Parent shall, and shall cause each of its Subsidiaries to,
(a) keep and maintain all property material to the conduct of its business in
good working order and condition, ordinary wear and tear excepted, (b) maintain
with financially sound and reputable insurance companies which are not
Affiliates of the Parent (i) insurance with respect to its properties and
business, and the properties and business of its Subsidiaries, against loss or
damage of the kinds customarily insured against by companies in the same or
similar businesses operating in the same or similar locations and (ii) all
insurance required to be maintained pursuant to the Collateral Documents, and
will, upon request of the Administrative Agent, furnish to each Lender at
reasonable intervals a certificate of a Responsible Officer setting forth the
nature and extent of all insurance maintained by the Parent, each Borrower, and
each of their respective Subsidiaries in accordance with this Section, and (c)

 

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at all times shall name the Administrative Agent as additional insured on all
liability policies of the Parent, each Borrower, and each of their Subsidiaries
and as lender’s loss payee (pursuant to a lender’s loss payee endorsement
approved by the Administrative Agent) on all casualty and property insurance
policies of the Parent, the Borrowers, and each of their respective
Subsidiaries.

 

Section 5.9.                                Use of Proceeds; Margin Regulations.

 

(a)                                 The Borrowers will use the proceeds of all
Loans to pay transaction costs and expenses arising in connection with the Loan
Documents, pay existing Indebtedness, and to finance working capital needs,
Permitted Acquisitions, and capital expenditures and for other general corporate
purposes of the Borrowers and, to the extent not prohibited herein, their
Subsidiaries.

 

(b)                                 No part of the proceeds of any Loan or
benefit of any Letter of Credit will be used, whether directly or indirectly,
for any purpose that would violate any rule or regulation of the Board of
Governors of the Federal Reserve System, including Regulation T, Regulation U or
Regulation X.  All Letters of Credit will be used for general corporate
purposes.

 

(c)                                  No Borrower will request any Borrowing or
Letter of Credit, and none of the Parent, any Borrower, nor any of their
respective Subsidiaries shall use, and each of Parent and each Borrower shall
ensure that each of their respective Subsidiaries and its or their respective
directors, officers, employees and agents shall not use, the proceeds of any
Borrowing or Letter of Credit (i) in furtherance of an offer, payment, promise
to pay, or authorization of the payment or giving of money, or anything else of
value, to any Person in violation of any Anti-Corruption Laws, (ii) for the
purpose of funding, financing or facilitating any activities, business or
transaction of or with any Sanctioned Person, or in any Sanctioned Country or
(iii) in any manner that would result in the violation of any Sanctions
applicable to any party hereto.

 

Section 5.10.                         Casualty and Condemnation.  The Borrower
Agent (a) will furnish to the Administrative Agent and the Lenders prompt
written notice of any casualty or other insured damage to any material portion
of any Collateral or the commencement of any action or preceding for the taking
of any material portion of any Collateral or any part thereof or interest
therein under power of eminent domain or by condemnation or similar proceeding
and (b) will  exercise commercially reasonable efforts to obtain net cash
proceeds of any such event (whether in the form of insurance proceeds,
condemnation awards or otherwise) and, to the extent applicable, applied in
accordance with the applicable provisions of this Agreement and the Collateral
Documents.

 

Section 5.11.                         Cash Management.

 

(a)                           Except as otherwise expressly permitted under this
Agreement and except for deposit accounts used solely as payroll, trust, or
fiduciary deposit accounts, the Canadian Related Deposit Accounts, and the GW
Related Deposit Account, no Loan Party shall open or maintain any other deposit
account unless the depository bank or financial institution for such deposit
account shall have entered into a Control Account Agreement in favor of the
Administrative Agent.  Any of the foregoing to the contrary notwithstanding, the
aggregate balance of all

 

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amounts on deposit in any deposit account which is not subject to a Control
Account Agreement (other than the Canadian Related Deposit Accounts) shall not
at any time exceed $250,000.

 

(b)                           The Loan Parties will not, after the Closing Date,
enter in any agreement with a Credit Card Processer unless such Credit Card
Processor is party to a Credit Card Processor Agreement (that applies to such
agreement) or executes and delivers a Credit Card Processor Agreement
contemporaneously with the entering into of such agreement.

 

(c)                            Each of the Loan Parties’ deposit accounts
established after the Closing Date (other than payroll, trust, and fiduciary
deposit accounts) shall be maintained at a bank or financial institution which
is reasonably acceptable to the Administrative Agent.

 

(d)                           If any Loan Party shall at any time receive any
remittances or any other funds representing proceeds of the Collateral, such
Loan Party shall hold the same as trustee for the Administrative Agent, shall,
except to the extent deposited into a Canadian Related Deposit Account or the GW
Related Deposit Account in accordance with the practices of the Loan Parties as
of the Closing Date, segregate such remittances or funds from its other assets,
and shall promptly deposit the same into a Collections Account or the
Concentration Account.  All cash, cash equivalents, checks, notes, drafts or
similar items of payment received by any Loan Party shall be deposited into a
Collections Account or the Concentration Account promptly upon (and in any event
within one Business Day of) receipt thereof by such Loan Party.

 

(e)                            On and after the Closing Date, the Borrowers
shall maintain one or more lockboxes and Collections Accounts and the
Concentration Account and direct their respective Account Debtors to make
payment on all Accounts to a lockbox (if made by tangible payment item) or, if
made by electronic means, to a Collections Account or the Concentration Account,
other than payments to the Canadian Related Deposit Accounts and the GW Related
Deposit Account, in each case, in accordance with the practices of the Loan
Parties as of the Closing Date.  The agreements relating to any lockbox shall
provide that all items received in such lockbox shall be submitted for
collection and the collected balance thereof be deposited in a Collections
Account or the Concentration Account on a daily basis.  The Control Account
Agreement relating to any Collections Account shall provide that all collected
balances in such Collections Account be transferred to the Concentration Account
on a daily basis.  At all times during a Cash Dominion Period, the
Administrative Agent may (at its election) cause the collected balances in the
Concentration Account to be applied directly to the payment of the Obligations
in the manner set forth in Section 2.14(d).  At all other times, the
Administrative Agent shall cause the collected balances in the Concentration
Account to (i) be transferred daily (or such other frequency as may be agreed to
by the Borrower and the Administrative Agent) to the Master Funding Account or
(ii) upon the written request of Borrower Agent from time to time, applied
directly to the payment of the Obligations in the manner set forth in
Section 2.14(d) (with it being agreed that, so long as no Cash Dominion Period
then exists, Borrower Agent may, by giving the Administrative Agent at least
three Business Days’ written notice, elect to cause such balances to be applied
in accordance with the foregoing clause (i)).  Each Collections Account and the
Concentration Account shall be under the sole dominion and exclusive control of
the Administrative Agent, on behalf of the Secured Parties, and no Loan Party
shall have any right to withdraw such amounts from the Collections Accounts or
the Concentration Account.

 

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(f)                             With respect to the Canadian Related Deposit
Accounts, (i) Parent shall not permit the collected balance on deposit in the
Canadian Related Deposit Accounts to exceed the Dollar Equivalent of $250,000
for more than two Business Days; (ii) not less than one time per week, cause the
collected balances on deposit in the Canadian Related Deposit Accounts to be
transferred to the Concentration Account (provided, however, that the Loan
Parties may leave not more than the Dollar Equivalent $25,000 of such balances,
in the aggregate, on deposit in the Canadian Related Deposit Accounts); (iii) at
no time shall any Loan Party permit any funds on deposit in the Canadian Related
Deposit Accounts to be transferred out of such deposit account other than
(A) transfers from the Canadian Related Deposit Account maintained in Canada to
the Canadian Related Deposit Account maintained in the United States;
(B) transfers to a Collections Account or the Concentration Account; and
(C) transfers to the depository institution at which such deposit account is
maintained for purposes of payment of the customary costs and expenses
associated with the maintenance of such deposit accounts); (iv) upon the request
of the Administrative Agent made during a Liquidity Period, promptly cause any
or all of the Canadian Related Deposit Accounts to become subject to a Control
Account Agreement (or an equivalent agreement reasonably satisfactory to the
Administrative Agent during such Liquidity Period), other than payroll, trust,
or fiduciary deposit accounts.

 

(g)                            With respect to the GW Related Deposit Account,
(i) Parent shall not permit the GW Related Deposit Account to be used for any
purposes other (A) the collection of Accounts arising from training programs
conducted by GW; (B) funding or making payroll for employees of GW; and
(C) customary bank service charges, fees, and indemnities solely relating to
such deposit account, and (ii) upon the request of the Administrative Agent made
during a Liquidity Period, cease using the GW Related Deposit Account for
payroll purposes and promptly cause the GW Related Deposit Account to become
subject to a Control Account Agreement.

 

Section 5.12.                         Additional Subsidiaries and Collateral.

 

(a)                                 If, after the Closing Date, any Person
becomes a Domestic Subsidiary, whether pursuant to formation, acquisition or
otherwise, (x) the Borrower Agent shall promptly notify the Administrative Agent
and the Lenders thereof and (y) within 30 days after such Person becomes a
Domestic Subsidiary, the Borrower Agent shall cause such Domestic Subsidiary
(i) to become a new Guarantor and to grant Liens in favor of the Administrative
Agent in the same types of collateral as granted by the other Loan Parties by
executing and delivering to the Administrative Agent a supplement to the
Guaranty and Security Agreement in form and substance reasonably satisfactory to
the Administrative Agent, authorizing and delivering, at the request of the
Administrative Agent, such UCC financing statements or similar instruments
required by the Administrative Agent to perfect the Liens in favor of the
Administrative Agent and granted under any of the Loan Documents and (ii) to
deliver all such other documentation (including, without limitation, certified
organizational documents, resolutions, lien searches, and legal opinions) and to
take all such other actions as such Subsidiary would have been required to
deliver and take pursuant to Section 3.1 if such Subsidiary had been a Loan
Party on the Closing Date.

 

(b)                                 [Reserved.]

 

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(c)                                  The Parent and each Borrower agree that,
following the delivery of any Collateral Documents required to be executed and
delivered by this Section, the Administrative Agent shall have a valid and
enforceable, first-priority perfected Lien on the property required to be
pledged pursuant to subsections (a) of this Section (to the extent that such
Lien can be perfected by execution, delivery and/or recording of the Collateral
Documents or UCC financing statements, or possession of such Collateral), free
and clear of all Liens other than Permitted Liens.  All actions to be taken
pursuant to this Section shall be at the expense of the Borrowers or the
applicable Loan Party, and shall be taken to the reasonable satisfaction of the
Administrative Agent.

 

Section 5.13.                         Additional Real Estates; Leased
Locations.  If after the Closing Date any Loan Party proposes to lease any Real
Estate or to locate any Collateral with any inventory processor, warehouseman,
or other bailee, it shall first provide to the Administrative Agent a copy of
the proposed lease or processing, warehousing, or other bailee agreement and
shall use its commercially reasonable efforts to obtain a fully executed
Collateral Access Agreement from the landlord of such leased property or such
processor, warehouseman, or bailee, which Collateral Access Agreement shall be
reasonably satisfactory in form and substance to the Administrative Agent;
provided that if such Loan Party is unable to deliver any such Collateral Access
Agreement after using its commercially reasonable efforts to do so, the
Administrative Agent may waive the foregoing requirement in its reasonable
discretion (although the waiver of such requirement shall not affect
Administrative Agent’s right to institute Reserves with respect to
arrangements).

 

Section 5.14.                         Further Assurances; Post-Closing Matters.

 

(a)                                 The Parent and each Borrower will, and will
cause each other Loan Party to, execute any and all further documents, financing
statements, agreements and instruments, and take all such further actions
(including the filing and recording of financing statements, fixture filings,
and other documents and related regulatory compliance), which may be required
under any applicable law, or which the Administrative Agent or the Required
Lenders may reasonably request, to effectuate the transactions contemplated by
the Loan Documents or to grant, preserve, protect or perfect the Liens created
by the Collateral Documents or the validity or priority of any such Lien, all at
the expense of the Loan Parties.  Each of the Parent and each Borrower also
agrees to provide to the Administrative Agent, from time to time upon request,
evidence reasonably satisfactory to the Administrative Agent as to the
perfection and priority of the Liens created or intended to be created by the
Collateral Documents.

 

(b)                                 Parent shall, and shall cause each of its
Subsidiaries (as applicable) to:

 

(i)                                     Exercise its commercially reasonable
efforts to obtain within 90 days after the Closing Date a Collateral Access
Agreement from each landlord for each leased location at which a Loan Party
keeps or maintains any of its books and records or where more than $2,500,000 of
the Loan Parties’ Inventory (in the aggregate) is located;

 

(ii)                                  Exercise its commercially reasonable
efforts to obtain within 30 days following the Closing Date a Credit Card
Processor Agreement with respect to each Credit Card Processor existing as of
the Closing Date; and

 

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(iii)                               Exercise its commercially reasonable efforts
to obtain within 30 days following the Closing Date a loss payee endorsement
from each Person providing trade receivables credit insurance to any Loan Party
as of the Closing Date.

 

ARTICLE VI
FINANCIAL COVENANT

 

Each of the Parent and each Borrower covenants and agrees that so long as any
Lender has a Commitment hereunder or any Obligation remains unpaid or
outstanding (except for inchoate or contingent indemnification obligations for
which no claim has been made or threatened):

 

Section 6.1.                                Fixed Charge Coverage Ratio.  Parent
and its Subsidiaries will maintain, as of the end of each Fiscal Month ending
most recently before the commencement of each Liquidity Period and each Fiscal
Month ending during a Liquidity Period, a Fixed Charge Coverage Ratio of not
less than 1.00 to 1.00.

 

ARTICLE VII
NEGATIVE COVENANTS

 

The Parent covenants and agrees that so long as any Lender has a Commitment
hereunder or any Obligation remains outstanding (except for inchoate or
contingent indemnification obligations for which no claim has been made or
threatened):

 

Section 7.1.                                Indebtedness and Preferred Equity. 
The Parent will not, and will not permit any of its Subsidiaries to, create,
incur, assume or suffer to exist any Indebtedness, except:

 

(a)                                 Indebtedness created pursuant to the Loan
Documents;

 

(b)                                 Indebtedness of the Parent and its
Subsidiaries existing on the date hereof and set forth on Schedule 7.1 and any
Permitted Refinancing Indebtedness in respect thereof;

 

(c)                                  Indebtedness of the Parent or any of its
Subsidiaries incurred to finance the acquisition, construction or improvement of
any fixed or capital assets, including Capital Lease Obligations, and any
Indebtedness assumed in connection with the acquisition of any such assets or
secured by a Lien on any such assets before the acquisition thereof (provided
that such Indebtedness is incurred before or within 90 days after such
acquisition or the completion of such construction or improvements) and any
Permitted Refinancing Indebtedness in respect thereof; provided that the
aggregate principal amount of such Indebtedness does not exceed $5,000,000 at
any time outstanding;

 

(d)                                 Indebtedness of any Loan Party owing to any
other Loan Party, Indebtedness of any Subsidiary which is not a Loan Party to
any other Subsidiary which is not a Loan Party, and, subject to
Section 7.4, Indebtedness of any Loan Party to any Subsidiary which is not a
Loan Party;

 

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(e)                                  Guarantees by the Parent or any Borrower of
Indebtedness of any Subsidiary and by any Subsidiary of Indebtedness of the
Parent or any other Subsidiary; provided that Guarantees by any Loan Party of
Indebtedness of any Subsidiary that is not a Subsidiary Loan Party shall be
subject to Section 7.4;

 

(f)                                   Indebtedness of any Person which becomes a
Subsidiary after the date of this Agreement; provided that (i) such Indebtedness
exists at the time that such Person becomes a Subsidiary and is not created in
contemplation of or in connection with such Person becoming a Subsidiary, and
(ii) the aggregate principal amount of such Indebtedness permitted hereunder
shall not exceed $5,000,000 at any time outstanding;

 

(g)                                  Indebtedness consisting of unpaid insurance
premiums owing to insurance companies and insurance brokers incurred in
connection with the financing of insurance premiums in the ordinary course of
business;

 

(h)                                 Hedging Obligations permitted by
Section 7.10; and

 

(i)                                     other unsecured Indebtedness of the
Parent or its Subsidiaries in an aggregate principal amount not to exceed
$1,000,000 at any time outstanding.

 

The Parent will not, and will not permit any Subsidiary to, issue any preferred
stock or other preferred equity interest that (i) matures or is mandatorily
redeemable pursuant to a sinking fund obligation or otherwise, (ii) is or may
become redeemable or repurchaseable by the Parent or such Subsidiary at the
option of the holder thereof, in whole or in part, or (iii) is convertible or
exchangeable at the option of the holder thereof for Indebtedness or preferred
stock or any other preferred equity interest described in this paragraph, on or
before, in the cases of clauses (i), (ii) or (iii), the first anniversary of the
Revolving Commitment Termination Date.

 

Section 7.2.                                Liens.  The Parent will not, and
will not permit any of its Subsidiaries to, create, incur, assume or suffer to
exist any Lien on any of its assets or property now owned or hereafter acquired,
except for the following (collectively, “Permitted Liens”):

 

(a)                                 Liens securing the Obligations; provided
that no Liens may secure Obligations constituting either Hedging Obligations or
Bank Product Obligations without securing all other Obligations on a basis at
least pari passu with such Hedging Obligations or Bank Product Obligations and
subject to the priority of payments set forth in Section 2.23 and Section 8.2;

 

(b)                                 Permitted Encumbrances;

 

(c)                                  Liens on any property or asset of the
Parent or any of its Subsidiaries existing on the date hereof and set forth on
Schedule 7.2;

 

(d)                                 purchase money Liens upon or in any fixed or
capital assets to secure the purchase price or the cost of construction or
improvement of such fixed or capital assets or to secure Indebtedness incurred
solely for the purpose of financing the acquisition, construction or improvement
of such fixed or capital assets (including Liens securing any Capital Lease
Obligations); provided that (i) any such Lien secures Indebtedness permitted by
Section 7.1(c), (ii) any such Lien attaches to such asset concurrently or within
90 days after the acquisition or

 

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the completion of the construction or improvements thereof, (iii) any such Lien
does not extend to any other asset, and (iv) the Indebtedness secured thereby
does not exceed the cost of acquiring, constructing or improving such fixed or
capital assets;

 

(e)                                  any Lien (x) existing on any asset of any
Person at the time such Person becomes a Subsidiary of the Parent, (y) existing
on any asset of any Person at the time such Person is merged with or into the
Parent or any of its Subsidiaries, or (z) existing on any asset before the
acquisition thereof by the Parent or any of its Subsidiaries; provided that
(i) any such Lien was not created in the contemplation of any of the foregoing
and (ii) any such Lien secures only those obligations which it secures on the
date that such Person becomes a Subsidiary or the date of such merger or the
date of such acquisition;

 

(f)                                   Liens securing Indebtedness permitted
under clause (g) of Section 7.1, which Liens attach solely to the insurance
policies financed in connection with such Indebtedness and the proceeds thereof;

 

(g)                                  Liens on any cash earnest deposits, cash
escrow arrangement or similar cash arrangements made by the Parent or any
Subsidiary in connection with any purchase agreement for or in anticipation of a
Permitted Acquisition or other transaction permitted hereunder;

 

(h)                                 in connection with the sale or transfer of
the Capital Stock in any Subsidiary or the sale of all or substantially all of
the assets of a Borrower or Subsidiary thereof or a division or business unit
thereof in a transaction permitted under Section 7.6, customary rights and
restrictions contained in agreements relating to such sale or transfer pending
the completion thereof; and

 

(i)                                     other Liens securing obligations in an
aggregate amount not to exceed $500,000 at any time outstanding, provided,
however, that such Liens do not attach to any Collateral.

 

Section 7.3.                                Fundamental Changes.

 

(a)                                 The Parent will not, and will not permit any
of its Subsidiaries to, merge into or consolidate into any other Person, or
permit any other Person to merge into or consolidate with it, or liquidate or
dissolve; provided that if, at the time thereof and immediately after giving
effect thereto, no Default or Event of Default shall have occurred and be
continuing, (i) Parent may merge with a Person in connection with a Permitted
Acquisition so long as a Parent is the surviving Person, (ii) a Borrower may
merge with a Person in connection with a Permitted Acquisition so long as a
Borrower is the surviving Person, (iii) any wholly owned Subsidiary may merge
into or consolidate with another wholly owned Subsidiary, provided that if any
party to such merger or consolidation is a Loan Party, a Loan Party shall be the
surviving Person, (iv) any Subsidiary (other than a Loan Party) may liquidate or
dissolve if the Parent determines in good faith that such liquidation or
dissolution is in the best interests of the Parent and its Subsidiaries and is
not materially disadvantageous to the Lenders, (v) any Subsidiary of the Parent
which is not a Borrower may merge into or consolidate with any Person in a
transaction permitted under Section 7.6 in which after giving effect to such
transaction, the surviving entity is not a Subsidiary and (vi) any Subsidiary
which is not a Borrower may liquidate or dissolve after the transfer of all or
substantially all of its assets to another Loan Party in a transaction permitted
under Section 7.6 if the Parent determines in good faith that such liquidation
or

 

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dissolution is in the best interest of the Parent and its Subsidiaries and the
Administrative Agent determines that such liquidation or dissolution is not
materially disadvantageous to the Lenders.

 

(b)                                 The Parent will not, and will not permit any
of its Subsidiaries to, engage in any business other than businesses of the type
conducted by the Parent and its Subsidiaries on the date hereof and businesses
reasonably related thereto.

 

Section 7.4.                                Investments, Loans.  The Parent will
not, and will not permit any of its Subsidiaries to, purchase, hold or acquire
(including pursuant to any merger with any Person that was not a wholly owned
Subsidiary before such merger) any Capital Stock, evidence of Indebtedness or
other securities (including any option, warrant, or other right to acquire any
of the foregoing) of, make or permit to exist any loans or advances to,
Guarantee any Indebtedness of, or make or permit to exist any investment or any
other interest in, any other Person (all of the foregoing being collectively
called “Investments”), or purchase or otherwise acquire (in one transaction or a
series of transactions) all or substantially all of the assets of any other
Person or a division or a business unit of any other Person, or create or form
any Subsidiary, except:

 

(a)                                 Investments (other than Permitted
Investments) existing on the date hereof and set forth on Schedule 7.4
(including Investments in Subsidiaries);

 

(b)                                 Permitted Investments;

 

(c)                                  Guarantees by the Parent and its
Subsidiaries constituting Indebtedness permitted by Section 7.1; provided that
the aggregate principal amount of Indebtedness of Subsidiaries that are not
Subsidiary Loan Parties that is Guaranteed by any Loan Party shall be subject to
the limitation set forth in subsection (d) of this Section;

 

(d)                                 Investments made by the Parent in or to any
Subsidiary and by any Subsidiary to the Parent or in or to another Subsidiary;
provided that the aggregate amount of Investments by the Loan Parties in or to,
and Guarantees by the Loan Parties of Indebtedness of, any Subsidiary that is
not a Subsidiary Loan Party (including all such Investments and Guarantees
existing on the Closing Date) shall not exceed $2,000,000 at any time
outstanding;

 

(e)                                  loans or advances to employees, officers or
directors of the Parent or any of its Subsidiaries in the ordinary course of
business for travel, relocation and related expenses; provided that the
aggregate amount of all such loans and advances does not exceed $250,000 at any
time outstanding;

 

(f)                                   Hedging Transactions permitted by
Section 7.10;

 

(g)                                  Permitted Acquisitions; and

 

(h)                                 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;

 

(i)                                     Investments as a result of the receipt
of non-cash consideration from a sale, transfer or other disposition of any
assets in compliance with Section 7.6; and

 

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(j)                                    other Investments which in the aggregate
do not exceed (i) when taken together with all other Investments made in the
same Fiscal Year, $7,500,000 and (ii) when taken together with all other
Investments made since the Closing Date, $15,000,000; provided that (A) no
Default or Event of Default shall have occurred and be continuing at the time
such Investment is made, and (B) immediately after giving effect to such
Investment either (1) Availability is greater than or equal to $12,500,000 or
(2) Availability is greater than or equal to $10,000,000 and Parent and its
Subsidiaries’ Fixed Charge Coverage Ratio, on a Pro Forma Basis, is at least
1.20 to 1.00.

 

Section 7.5.                                Restricted Payments.  Parent will
not, and will not permit any of its Subsidiaries to, declare or make, or agree
to pay or make, directly or indirectly, any Restricted Payment, except:

 

(a)                                 dividends payable by the Parent solely in
interests of any class of its common equity; and

 

(b)                                 Restricted Payments made by any Subsidiary
to any Borrower, the Parent, or to another Subsidiary, on at least a pro rata
basis with any other shareholders if such Subsidiary is not wholly owned by the
Parent and other wholly owned Subsidiaries of the Parent;

 

(c)                                  the declaration and payment of Restricted
Payments in the form of redemptions, repurchases, retirement, defeasance, or
other acquisition of or in respect of the common equity of the Parent in
connection with the payment or exercise of, or satisfaction of tax withholding
obligations of participants on account of or relating to, awards held by or
granted from time to time to participants in equity compensation plans of the
Parent not to exceed $2,000,000 in the aggregate in any period of 12 consecutive
Fiscal Months; provided that no Default or Event of Default shall have occurred
and be continuing at the time such redemption, repurchase, retirement,
defeasance, or other acquisition is declared or made;

 

(d)                                 the declaration and payment of Restricted
Payments in the form of cash dividends or distributions on or in respect of, or
redemptions, repurchases, retirement, defeasance, or other acquisition of or in
respect of the common equity of the Parent; provided that (i) no Default or
Event of Default shall have occurred and be continuing at the time such dividend
or distribution is declared, (ii) no Specified Default shall have occurred and
be continuing at the time such dividend or distribution is paid or such
redemption, repurchase, retirement, defeasance, or other acquisition is made,
and (iii) at the time such Restricted Payment is declared and immediately after
giving effect to the payment thereof, either (A) Availability is greater than or
equal to $12,500,000 or (B) Availability is greater than or equal to $10,000,000
and Parent and its Subsidiaries’ Fixed Charge Coverage Ratio, on a Pro Forma
Basis, is at least 1.20 to 1.00.

 

Section 7.6.                                Disposition of Assets.  The Parent
will not, and will not permit any of its Subsidiaries to, convey, sell, lease,
assign, transfer or otherwise dispose of any of its assets, business or property
or, in the case of any Subsidiary, any shares of such Subsidiary’s Capital
Stock, in each case whether now owned or hereafter acquired, to any Person other
than the Parent or any of its wholly owned Subsidiaries that is a Loan Party (or
to qualify directors if required by applicable law), except:

 

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(a)                                 the sale or other disposition of obsolete or
worn out property or other property not necessary for operations disposed of in
the ordinary course of business;

 

(b)                                 the sale of inventory in the ordinary course
of business and Permitted Investments;

 

(c)                                  the sale or other disposition of such
assets in an aggregate amount not to exceed $500,000 in any 12-month period
ending on the date of determination thereof; and

 

(d)                                 any sale, transfer, license or lease of
assets in the ordinary course of business which are replaced by substitute
assets acquired, licensed or leased.

 

Section 7.7.                                Transactions with Affiliates. 
Parent will not, and will not permit any of its Subsidiaries to, sell, lease or
otherwise transfer any property or assets to, or purchase, lease or otherwise
acquire any property or assets from, or otherwise engage in any other
transactions with, any of its Affiliates, except:

 

(a)                                 in the ordinary course of business at prices
and on terms and conditions not less favorable to the Parent or such Subsidiary
than could be obtained on an arm’s-length basis from unrelated third parties;

 

(b)                                 transactions between or among the Loan
Parties;

 

(c)                                  transactions permitted under Section 7.3;

 

(d)                                 transactions permitted under Section 7.4;

 

(e)                                  any Restricted Payment permitted by
Section 7.5; and

 

(f)                                   transactions permitted under Section 7.6.

 

Section 7.8.                                Restrictive Agreements.  Parent will
not, and will not permit any of its Subsidiaries to, directly or indirectly,
enter into, incur or permit to exist any agreement that prohibits, restricts or
imposes any condition upon (a) the ability of the Parent or any of its
Subsidiaries to create, incur or permit any Lien upon any of its assets or
properties, whether now owned or hereafter acquired, or (b) the ability of any
of its Subsidiaries to pay dividends or other distributions with respect to its
Capital Stock, to make or repay loans or advances to the Parent or any other
Subsidiary thereof, to Guarantee Indebtedness of the Parent or any other
Subsidiary thereof or to transfer any of its property or assets to the Parent or
any other Subsidiary thereof; provided that (i) the foregoing shall not apply to
restrictions or conditions imposed by law or by this Agreement or any other Loan
Document, (ii) the foregoing shall not apply to customary restrictions and
conditions contained in agreements relating to the sale of a Subsidiary or a
division, product line or line of business of the Parent or any Subsidiary
pending such sale, provided such restrictions and conditions apply only to the
Subsidiary or assets that is or are to be sold, such sale is permitted hereunder
and such restrictions do not prohibit such Subsidiary from complying with its
obligations under this Agreement and the other Loan Documents, (iii) clause
(a) shall not apply to restrictions or conditions imposed by any agreement
relating to secured Indebtedness permitted by this Agreement if such
restrictions and conditions apply only

 

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to the property or assets securing such Indebtedness, (iv) clause (a) shall not
apply to customary provisions, contracts, licenses or in leases prohibiting or
restricting the assignment, subleasing or sublicensing thereof and (v) clause
(a) shall not apply to any restrictions and conditions imposed by agreements
relating to Indebtedness of any Subsidiary in existence at the time such
Subsidiary became a Subsidiary, provided that any such restriction as not
created in contemplation of the foregoing so long as such restrictions do not
prohibit or limit such Subsidiary’s obligations under this Agreement or the
other Loan Documents or the Loan Parties’ compliance with Section 5.12.

 

Section 7.9.                                [Reserved.]

 

Section 7.10.                         Hedging Transactions.  Parent will not,
and will not permit any of its Subsidiaries to, enter into any Hedging
Transaction, other than Hedging Transactions entered into in the ordinary course
of business to hedge or mitigate risks to which Parent or any of its
Subsidiaries is exposed in the conduct of its business or the management of its
liabilities.  Solely for the avoidance of doubt, the Parent acknowledges that a
Hedging Transaction entered into for speculative purposes or of a speculative
nature (which shall be deemed to include any Hedging Transaction under which the
Parent or any of its Subsidiaries is or may become obliged to make any payment
(i) in connection with the purchase by any third party of any Capital Stock or
any Indebtedness or (ii) as a result of changes in the market value of any
Capital Stock or any Indebtedness) is not a Hedging Transaction entered into in
the ordinary course of business to hedge or mitigate risks.

 

Section 7.11.                         Amendment to Material Documents.  Parent
will not, and will not permit any of its Subsidiaries to, amend, modify or waive
any of its rights under (a) its certificate of incorporation, bylaws or other
organizational documents or (b) any Material Agreements, except as expressly
permitted in Section 7.12(b) or in any manner that could not reasonably be
expected to have an adverse effect on the Lenders, the Administrative Agent,
Parent, or any of its Subsidiaries.

 

Section 7.12.                         Prepayments and Amendments .

 

(a)                                 The Parent will not, and will not permit any
of its Subsidiaries to (i) prepay, redeem, repurchase or otherwise acquire for
value any Indebtedness, other than (A) the Obligations in accordance with the
terms of this Agreement, (B) any Indebtedness owing by any Subsidiary to a Loan
Party, (C) with the proceeds of any Indebtedness which constitutes Permitted
Refinancing Indebtedness, or (D) prepayments, redemptions, repurchases, or other
acquisitions for value of Indebtedness (other than Subordinated Debt) so long as
(1) if the aggregate amounts paid therefor during any Fiscal Year exceeds
$10,000,000, no Default or Event of Default shall have occurred and be
continuing at the time such Investment is made and immediately after giving
effect to such Investment, either (aa) Availability is greater than or equal to
$12,500,000 or (bb) Availability is greater than or equal to $10,000,000 and
Parent and its Subsidiaries’ Fixed Charge Coverage Ratio, on a Pro Forma Basis,
is at least 1.20 to 1.00 and (2) in all other cases, no Default or Event of
Default exists before or immediately after giving effect thereto or (ii) make
any principal, interest or other payments on or in respect of any Subordinated
Debt that is not expressly permitted by the subordination provisions applicable
to such Subordinated Debt.

 

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(b)                                 The Parent will not, and will not permit any
of its Subsidiaries to, agree to or permit any amendment, modification or waiver
of any provision of any documents, instruments, agreements, or other writings
evidencing or executed and delivered in connection with any Indebtedness or any
Subordinated Debt other than (i) the Obligations in accordance with the terms of
this Agreement, (ii) Indebtedness among Loan Parties, (iii) Indebtedness
described in Section 7.1(c) or Section 7.1(h), and (iv) Indebtedness
constituting a Bank Product Obligations; provided, that no such amendment,
modification, or waiver shall be permitted if such Indebtedness, after giving
effect to such amendment, modification, or waiver, does not constitute
Indebtedness permitted under Section 7.1.

 

Section 7.13.                         Accounting Changes.  Parent will not, and
will not permit any of its Subsidiaries to, make any significant change in
accounting treatment or reporting practices, except as required by GAAP, or
change the fiscal year of the Parent or of any of its Subsidiaries, except to
change the fiscal year of a Subsidiary to conform its fiscal year to that of the
Parent.

 

Section 7.14.                         [Reserved.]

 

Section 7.15.                         Government Regulation.  Parent will not,
and will not permit any of its Subsidiaries to, (a) be or become subject at any
time to any law, regulation or list of any Governmental Authority of the United
States (including, without limitation, the OFAC list) that prohibits or limits
the Lenders or the Administrative Agent from making any advance or extension of
credit to the Borrowers or from otherwise conducting business with the Loan
Parties, or (b) fail to provide documentary and other evidence of the identity
of the Loan Parties as may be requested by the Lenders or the Administrative
Agent at any time to enable the Lenders or the Administrative Agent to verify
the identity of the Loan Parties or to comply with any applicable law or
regulation, including, without limitation, Section 326 of the Patriot Act at 31
U.S.C. Section 5318.

 

Section 7.16.                         Certain Covenants Relating to National Air
Time.  Parent will not, nor shall it permit any of its Subsidiaries to, conduct
any business or enter into any transaction with National Air Time (including,
without limitation, the making of any Investments in National Air Time (whether
in the form of a loan, a capital contribution, the guarantee of Indebtedness, or
the making of any payment of cash for or on behalf of National Air Time), or the
selling or purchasing any assets from or to National Air Time), other than
business and transactions directly related to and in furtherance of the
liquidation and dissolution of National Air Time (and, if such business or
transaction involves the making of any Investment in National Air Time, the
maximum amount permitted to be made after the Closing Date without
Administrative Agent’s prior written consent shall not exceed $15,000 per
year).  Parent shall not permit National Air Time to (a) conduct any business,
other than business directly related to or in furtherance of the liquidation and
dissolution of National Air Time; (b) dispose of any of its assets, other than
to a Loan Party; (c) incur any Indebtedness; (d) grant any liens or security
interests; or (e) make any Investments (other than in or with respect to a Loan
Party).

 

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ARTICLE VIII

 

EVENTS OF DEFAULT

 

Section 8.1.                                Events of Default.  If any of the
following events (each, an “Event of Default”) shall occur:

 

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

 

(b)                                 the Borrowers shall fail to pay any interest
on any Loan or any fee or any other amount (other than an amount payable under
subsection (a) of this Section) payable under this Agreement or any other Loan
Document, when and as the same shall become due and payable, and such failure
shall continue unremedied for a period of three Business Days; or

 

(c)                                  any representation or warranty made or
deemed made by or on behalf of the Parent or any of its Subsidiaries in or in
connection with this Agreement or any other Loan Document (including the
Schedules attached hereto and thereto), or in any amendments or modifications
hereof or waivers hereunder or thereunder, or in any certificate, submitted to
the Administrative Agent or the Lenders by any Loan Party or any representative
of any Loan Party pursuant to or in connection with this Agreement or any other
Loan Document shall prove to be incorrect in any material respect (other than
any representation or warranty that is expressly qualified by a Material Adverse
Effect or other materiality qualifier, in which case such representation or
warranty shall prove to be incorrect in any respect) when made or deemed made or
submitted; or

 

(d)                                 the Parent or any Borrower shall fail to
observe or perform any covenant or agreement contained in Section 5.1, 5.2, 5.3
(with respect to such Person’s legal existence), or 5.14(b) or Article VI or
VII; or

 

(e)                                  any Loan Party shall fail to observe or
perform any covenant or agreement contained in this Agreement (other than those
referred to in subsections (a), (b) and (d) of this Section) or any other Loan
Document, and such failure shall remain unremedied for 30 days after the earlier
of (i) any officer of such Loan Party becomes aware of such failure, or
(ii) notice thereof shall have been given to the Borrower Agent by the
Administrative Agent or any Lender;

 

(f)                                   any default or event of default by a Loan
Party (after giving effect to any grace period) shall have occurred and be
continuing under any documents, instruments, agreements, or other writings
evidencing or executed and delivered in connection with any Subordinated Debt,
or any such document, instrument, agreement, or other writing shall cease to be
in full force and effect, or the validity or enforceability thereof is
disaffirmed by or on behalf of any subordinated lender party thereto, or any
Obligations fail to constitute senior indebtedness (or words or phrase of
similar import) thereunder, or all or any part of the Subordinated Debt is
accelerated, is declared to be due and payable or is required to be prepaid or
redeemed, in each case before the stated maturity thereof; or

 

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(g)                                  (i) the Parent or any of its Subsidiaries
(whether as primary obligor or as guarantor or other surety) shall fail to pay
any principal of, or premium or interest on, any Material Indebtedness that is
outstanding, when and as the same shall become due and payable (whether at
scheduled maturity, required prepayment, acceleration, demand or otherwise), and
such failure shall continue after the applicable grace period, if any, specified
in the agreement or instrument evidencing or governing such Indebtedness; or any
other event shall occur or condition shall exist under any agreement or
instrument relating to any Material Indebtedness and shall continue after the
applicable grace period, if any, specified in such agreement or instrument, if
the effect of such event or condition is to accelerate, or permit the
acceleration of, the maturity of such Indebtedness; or any Material Indebtedness
shall be declared to be due and payable, or required to be prepaid or redeemed
(other than by a regularly scheduled required prepayment or redemption),
purchased or defeased, or any offer to prepay, redeem, purchase or defease such
Indebtedness shall be required to be made, in each case before the stated
maturity thereof; or (ii) there occurs under any Hedging Transaction an Early
Termination Date (as defined in such Hedging Transaction) resulting from (A) any
event of default under such Hedging Transaction as to which the Parent or any of
its Subsidiaries is the Defaulting Party (as defined in such Hedging
Transaction) and the Hedge Termination Value owed by the Parent or such
Subsidiary as a result thereof is greater than $500,000 or (B) any Termination
Event (as so defined) under such Hedging Transaction as to which the Parent or
any Subsidiary is an affected party (as so defined) and the Hedge Termination
Value owed by the Parent or such Subsidiary as a result thereof is greater than
$500,000 and is not paid;

 

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

 

(i)                                     an involuntary proceeding shall be
commenced or an involuntary petition shall be filed seeking (i) liquidation,
reorganization or other relief in respect of the Parent or any of its
Subsidiaries or its debts, or any substantial part of its assets, under any
federal, state or foreign bankruptcy, insolvency or other similar law now or
hereafter in effect or (ii) the appointment of a custodian, trustee, receiver,
liquidator or other similar official for the Parent or any of its Subsidiaries
or for a substantial part of its assets, and in any such case, such proceeding
or petition shall remain undismissed for a period of 60 days or an order or
decree approving or ordering any of the foregoing shall be entered; or

 

(j)                                    the Parent or any of its Subsidiaries
shall become unable to pay, shall admit in writing its inability to pay, or
shall fail to pay, its debts as they become due; or

 

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(k)                                 (i) an ERISA Event shall have occurred that,
when taken together with other ERISA Events that have occurred, could reasonably
be expected to result in liability to the Parent and its Subsidiaries in an
aggregate amount exceeding $100,000, (ii) there is or arises an Unfunded Pension
Liability (not taking into account Plans with negative Unfunded Pension
Liability) in an aggregate amount exceeding $100,000, or (iii) there is or
arises any potential Withdrawal Liability in an aggregate amount exceeding
$100,000; or

 

(l)                                     any judgment or order for the payment of
money in excess of $1,000,000 in the aggregate shall be rendered against the
Parent or any of its Subsidiaries (exclusive of (i) any such judgment or order
covered by insurance (other than under a self-insurance program) provided by a
financially sound insurer to the extent a claim therefor has been made in
writing and liability therefor has not been denied by such insurer, and (ii) any
customary deductible payable in connection therewith), and either
(i) enforcement proceedings shall have been commenced by any creditor upon such
judgment or order or (ii) there shall be a period of 30 consecutive days during
which a stay of enforcement of such judgment or order, by reason of a pending
appeal or otherwise, shall not be in effect; or

 

(m)                             any non-monetary judgment or order shall be
rendered against the Parent or any of its Subsidiaries that could reasonably be
expected, either individually or in the aggregate, to have a Material Adverse
Effect, and there shall be a period of 30 consecutive days during which a stay
of enforcement of such judgment or order, by reason of a pending appeal or
otherwise, shall not be in effect; or

 

(n)                                 a Change in Control shall occur or exist; or

 

(o)                                 the Guaranty and Security Agreement or any
other Collateral Document shall for any reason cease to be valid and binding on,
or enforceable against, any Loan Party, or any Loan Party shall so state in
writing, or any Loan Party shall seek to terminate its obligation under the
Guaranty and Security Agreement or any other Collateral Document (other than the
release of any guaranty or collateral to the extent permitted pursuant to
Section 9.11); or

 

(p)                                 any Lien purported to be created under any
Collateral Document shall fail or cease to be, or shall be asserted by any Loan
Party not to be, a valid and perfected Lien on any Collateral, with the priority
required by the applicable Collateral Documents;

 

then, and in every such event (other than an event with respect to the Parent or
any of its Subsidiaries described in subsection (h) or (i) of this Section) and
at any time thereafter during the continuance of such event, the Administrative
Agent may, and upon the written request of the Required Lenders shall, by notice
to the Borrower Agent, take any or all of the following actions, at the same or
different times: (i) terminate the Commitments, whereupon the Commitment of each
Lender shall terminate immediately, (ii) declare the principal of and any
accrued interest on the Loans, and all other Obligations owing hereunder, to be,
whereupon the same shall become, due and payable immediately, without
presentment, demand, protest or other notice of any kind, all of which are
hereby waived by the Loan Parties, (iii) exercise all remedies contained in any
other Loan Document, and (iv) exercise any other remedies available at law or in
equity; provided that, if an Event of Default specified in either subsection
(h) or (i) shall occur, the Commitments shall automatically terminate and the
principal of the Loans then outstanding, together with accrued interest thereon,
and all fees and all other Obligations shall automatically

 

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become due and payable, without presentment, demand, protest or other notice of
any kind, all of which are hereby waived by the Loan Parties.

 

Section 8.2.                                Application of Proceeds from
Collateral.  All proceeds from each sale of, or other realization upon, all or
any part of the Collateral by any Secured Party after an Event of Default arises
shall be applied as follows:

 

(a)                                 first, to the reimbursable expenses of the
Administrative Agent incurred in connection with such sale or other realization
upon the Collateral, until the same shall have been paid in full;

 

(b)                                 second, to the fees and other reimbursable
expenses of the Administrative Agent, the Swingline Lender and the Issuing Bank
then due and payable pursuant to any of the Loan Documents, until the same shall
have been paid in full;

 

(c)                                  third, to all reimbursable expenses, if
any, of the Lenders (other than Defaulting Lenders) then due and payable
pursuant to any of the Loan Documents, until the same shall have been paid in
full;

 

(d)                                 fourth, to the fees and interest then due
and payable under the terms of this Agreement (other than fees and interest due
and payable to any Defaulting Lender), until the same shall have been paid in
full;

 

(e)                                  fifth, ratably, to (i) the aggregate
outstanding principal amount of the Loans (other than Loans made by any
Defaulting Lender), the LC Exposure constituting unreimbursed draws under any
Letter of Credit, the Net Mark-to-Market Exposure of the Hedging Obligations
that constitute Obligations until the same shall have been paid in full,
allocated pro rata among the Secured Parties (other than Defaulting Lenders)
based on their respective pro rata shares of the aggregate amount of such Loans,
such LC Exposure, and Net Mark-to-Market Exposure of such Hedging Obligations
and (ii) to the Administrative Agent as cash collateral for the undrawn amount
of all Letters of Credit, until the amount of such cash collateral held by the
Administrative Agent equal 105% of the undrawn amount of all Letters of Credit;

 

(f)                                   sixth, to the Administrative Agent for the
account of the Bank Product Providers, based on their respective pro rata shares
of the aggregate amount of the Bank Product Obligations;

 

(g)                                  seventh, ratably, to pay the Obligations
owing to any Defaulting Lenders; and

 

(h)                                 eighth, to the extent any proceeds remain,
to the Borrowers or as otherwise provided by a court of competent jurisdiction.

 

All amounts allocated pursuant to the foregoing clauses third through fifth to
the Lenders as a result of amounts owed to the Lenders under the Loan Documents
shall be allocated among, and distributed to, the Lenders pro rata based on
their respective Pro Rata Shares; provided that all amounts allocated to that
portion of the LC Exposure comprised of the aggregate undrawn amount of all
outstanding Letters of Credit pursuant to clause fifth shall be distributed to
the Administrative Agent, rather than to the Lenders, and held by the
Administrative Agent in an

 

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account in the name of the Administrative Agent for the benefit of the Issuing
Bank and the Lenders as cash collateral for the LC Exposure, such account to be
administered in accordance with Section 2.24(g).  All cash collateral for LC
Exposure shall be applied to satisfy drawings under the Letters of Credit as
they occur; if any amount remains on deposit on cash collateral after all
letters of credit have either been fully drawn or expired, such remaining amount
shall be applied to other Obligations, if any, in the order set forth above.

 

Notwithstanding the foregoing, (a)  no amount received from any Guarantor
(including any proceeds of any sale of, or other realization upon, all or any
part of the Collateral owned by such Guarantor) shall be applied to any Excluded
Swap Obligation of such Guarantor and (b)    Bank Product Obligations and
Hedging Obligations shall be excluded from the application described above if
the Administrative Agent has not received written notice thereof (and
acknowledged the same in writing), together with such supporting documentation
as the Administrative Agent may request, from the Bank Product Provider or the
Lender-Related Hedge Provider, as the case may be.  Each Bank Product Provider
or Lender-Related Hedge Provider that has given the notice contemplated by the
preceding sentence shall, by such notice, be deemed to have acknowledged and
accepted the appointment of the Administrative Agent pursuant to the terms of
Article IX hereof for itself and its Affiliates as if a “Lender” party hereto.

 

ARTICLE IX

 

THE ADMINISTRATIVE AGENT

 

Section 9.1.                                Appointment of the Administrative
Agent.

 

(a)                                 Each Lender irrevocably appoints SunTrust
Bank as the Administrative Agent and authorizes it to take such actions on its
behalf and to exercise such powers as are delegated to the Administrative Agent
under this Agreement and the other Loan Documents, together with all such
actions and powers that are reasonably incidental thereto.  The Administrative
Agent may perform any of its duties hereunder or under the other Loan Documents
by or through any one or more sub-agents or attorneys-in-fact appointed by the
Administrative Agent.  The Administrative Agent and any such sub-agent or
attorney-in-fact may perform any and all of its duties and exercise its rights
and powers through their respective Related Parties.  The exculpatory provisions
set forth in this Article shall apply to any such sub-agent, attorney-in-fact or
Related Party and shall apply to their respective activities in connection with
the syndication of the credit facilities provided for herein as well as
activities as the Administrative Agent.

 

(b)                                 The Issuing Bank shall act on behalf of the
Lenders with respect to any Letters of Credit issued by it and the documents
associated therewith until such time and except for so long as the
Administrative Agent may agree at the request of the Required Lenders to act for
the Issuing Bank with respect thereto; provided that the Issuing Bank shall have
all the benefits and immunities (i) provided to the Administrative Agent in this
Article with respect to any acts taken or omissions suffered by the Issuing Bank
in connection with Letters of Credit issued by it or proposed to be issued by it
and the application and agreements for letters of credit pertaining to the
Letters of Credit as fully as if the term “Administrative Agent” as used in this
Article

 

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included the Issuing Bank with respect to such acts or omissions and (ii) as
additionally provided in this Agreement with respect to the Issuing Bank.

 

Section 9.2.                                Nature of Duties of the
Administrative Agent.  The Administrative Agent shall not have any duties or
obligations except those expressly set forth in this Agreement and the other
Loan Documents.  Without limiting the generality of the foregoing, (a) the
Administrative Agent shall not be subject to any fiduciary or other implied
duties, regardless of whether a Default or an Event of Default has occurred and
is continuing, (b) the Administrative Agent shall not have any duty to take any
discretionary action or exercise any discretionary powers, except those
discretionary rights and powers expressly contemplated by the Loan Documents
that the Administrative Agent is required to exercise in writing by the Required
Lenders (or such other number or percentage of the Lenders as shall be necessary
under the circumstances as provided in Section 10.2), provided that the
Administrative Agent shall not be required to take any action that, in its
opinion or the opinion of its counsel, may expose the Administrative Agent to
liability or that is contrary to any Loan Document or applicable law, including
for the avoidance of doubt any action that may be in violation of the automatic
stay under any Debtor Relief Law or that may effect a forfeiture, modification
or termination of property of a Defaulting Lender in violation of any Debtor
Relief Law; and (c) except as expressly set forth in the Loan Documents, the
Administrative Agent shall not have any duty to disclose, and shall not be
liable for the failure to disclose, any information relating to the Parent or
any of its Subsidiaries that is communicated to or obtained by the
Administrative Agent or any of its Affiliates in any capacity.  The
Administrative Agent shall not be liable for any action taken or not taken by
it, its sub-agents or its attorneys-in-fact with the consent or at the request
of the Required Lenders (or such other number or percentage of the Lenders as
shall be necessary under the circumstances as provided in Section 10.2) or in
the absence of its own gross negligence or willful misconduct as determined by a
court of competent jurisdiction in a final non-appealable judgment.  The
Administrative Agent shall not be responsible for the negligence or misconduct
of any sub-agents or attorneys-in-fact except to the extent that a court of
competent jurisdiction determines in a final and nonappealable judgment that the
Administrative Agent acted with gross negligence or willful misconduct in the
selection of such sub-agents.  The Administrative Agent shall not be deemed to
have knowledge of any Default or Event of Default unless and until written
notice thereof (which notice shall include an express reference to such event
being a “Default” or “Event of Default” hereunder) is given to the
Administrative Agent by the Borrower Agent or any Lender, and the Administrative
Agent shall not be responsible for or have any duty to ascertain or inquire into
(i) any statement, warranty or representation made in or in connection with any
Loan Document, (ii) the contents of any certificate, report or other document
delivered hereunder or thereunder or in connection herewith or therewith,
(iii) the performance or observance of any of the covenants, agreements, or
other terms and conditions set forth in any Loan Document, (iv) the validity,
enforceability, effectiveness or genuineness of any Loan Document or any other
agreement, instrument or document, or (v) the satisfaction of any condition set
forth in Article III or elsewhere in any Loan Document, other than to confirm
receipt of items expressly required to be delivered to the Administrative
Agent.  The Administrative Agent may consult with legal counsel (including
counsel for the Borrowers) concerning all matters pertaining to such duties.

 

Section 9.3.                                Lack of Reliance on the
Administrative Agent.  Each of the Lenders, the Swingline Lender and the Issuing
Bank acknowledges that it has, independently and without

 

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

 

Section 9.4.                                Certain Rights of the Administrative
Agent.  If the Administrative Agent shall request instructions from the Required
Lenders with respect to any action or actions (including the failure to act) in
connection with this Agreement, the Administrative Agent shall be entitled to
refrain from such act or taking such act unless and until it shall have received
instructions from such Lenders, and the Administrative Agent shall not incur
liability to any Person by reason of so refraining.  Without limiting the
foregoing, no Lender shall have any right of action whatsoever against the
Administrative Agent as a result of the Administrative Agent acting or
refraining from acting hereunder in accordance with the instructions of the
Required Lenders where required by the terms of this Agreement.

 

Section 9.5.                                Reliance by the Administrative
Agent.  The Administrative Agent shall be entitled to rely upon, and shall not
incur any liability for relying upon, any notice, request, certificate, consent,
statement, instrument, document or other writing (including any electronic
message, posting or other distribution) believed by it to be genuine and to have
been signed, sent or made by the proper Person.  The Administrative Agent may
also rely upon any statement made to it orally or by telephone and believed by
it to be made by the proper Person and shall not incur any liability for relying
thereon.  The Administrative Agent may consult with legal counsel (including
counsel for the Loan Parties), independent public accountants and other experts
selected by it and shall not be liable for any action taken or not taken by it
in accordance with the advice of such counsel, accountants or experts.

 

Section 9.6.                                The Administrative Agent in its
Individual Capacity.  The bank serving as the Administrative Agent shall have
the same rights and powers under this Agreement and any other Loan Document in
its capacity as a Lender as any other Lender and may exercise or refrain from
exercising the same as though it were not the Administrative Agent; and the
terms “Lenders,” “Required Lenders,” “Supermajority Lenders,” or any similar
terms shall, unless the context clearly otherwise indicates, include the
Administrative Agent in its individual capacity.  The bank acting as the
Administrative Agent and its Affiliates may accept deposits from, lend money to,
and generally engage in any kind of business with the Parent or any Subsidiary
or Affiliate of the Parent as if it were not the Administrative Agent hereunder.

 

Section 9.7.                                Successor Administrative Agent.

 

(a)                                 The Administrative Agent may resign at any
time by giving notice thereof to the Lenders and the Borrower Agent.  Upon any
such resignation, the Required Lenders shall have the right to appoint a
successor Administrative Agent, subject to approval by the Borrower Agent
provided that no Default or Event of Default shall exist at such time.  If no
successor Administrative Agent shall have been so appointed, and shall have
accepted such appointment

 

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within 30 days after the retiring Administrative Agent gives notice of
resignation, then the retiring Administrative Agent may, on behalf of the
Lenders, appoint a successor Administrative Agent which shall be a commercial
bank organized under the laws of the United States or any state thereof or a
bank which maintains an office in the United States.

 

(b)                                 Upon the acceptance of its appointment as
the Administrative Agent hereunder by a successor, such successor Administrative
Agent shall thereupon succeed to and become vested with all the rights, powers,
privileges and duties of the retiring Administrative Agent, and the retiring
Administrative Agent shall be discharged from its duties and obligations under
this Agreement and the other Loan Documents.  If, within 45 days after written
notice is given of the retiring Administrative Agent’s resignation under this
Section, no successor Administrative Agent shall have been appointed and shall
have accepted such appointment, then on such 45th day (i) the retiring
Administrative Agent’s resignation shall become effective, (ii) the retiring
Administrative Agent shall thereupon be discharged from its duties and
obligations under the Loan Documents and (iii) the Required Lenders shall
thereafter perform all duties of the retiring Administrative Agent under the
Loan Documents until such time as the Required Lenders appoint a successor
Administrative Agent as provided above.  After any retiring Administrative
Agent’s resignation hereunder, the provisions of this Article shall continue in
effect for the benefit of such retiring Administrative Agent and its
representatives and agents in respect of any actions taken or not taken by any
of them while it was serving as the Administrative Agent.

 

(c)                                  In addition to the foregoing, if a Lender
becomes, and during the period it remains, a Defaulting Lender, and if any
Default has arisen from a failure of any Borrower to comply with
Section 2.28(a), then the Issuing Bank and the Swingline Lender may, upon prior
written notice to the Borrower Agent and the Administrative Agent, resign as
Issuing Bank or as Swingline Lender, as the case may be, effective at the close
of business Atlanta, Georgia time on a date specified in such notice (which date
may not be less than five Business Days after the date of such notice).

 

Section 9.8.                                Withholding Tax.

 

(a)                                 To the extent required by any applicable
law, the Administrative Agent may withhold from any interest payment to any
Lender an amount equivalent to any applicable withholding tax.  If the Internal
Revenue Service or any authority of the United States or any other jurisdiction
asserts a claim that the Administrative Agent did not properly withhold tax from
amounts paid to or for the account of any Lender (because the appropriate form
was not delivered or was not properly executed, or because such Lender failed to
notify the Administrative Agent of a change in circumstances that rendered the
exemption from, or reduction of, withholding tax ineffective, or for any other
reason), such Lender shall indemnify the Administrative Agent (to the extent
that the Administrative Agent has not already been reimbursed by the Borrowers
and without limiting the obligation of each Borrower to do so) fully for all
amounts paid, directly or indirectly, by the Administrative Agent as tax or
otherwise, including penalties and interest, together with all expenses
incurred, including legal expenses, allocated staff costs and any out of pocket
expenses.

 

(b)                                 Without duplication of any indemnity
provided under subsection (a) of this Section, each Lender shall also indemnify
the Administrative Agent, within 10 days after

 

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demand therefor, for (i) any Indemnified Taxes or Other Taxes attributable to
such Lender (to the extent that the Administrative Agent has not already been
reimbursed by the Borrowers and without limiting the obligation of the Borrowers
to do so), (ii) any Taxes attributable to such Lender’s failure to comply with
the provisions of Section 10.4(d) relating to the maintenance of a Participant
Register and (iii) any Excluded Taxes attributable to such Lender, in each case,
that are payable or paid by the Administrative Agent in connection with any Loan
Document, and any reasonable expenses arising therefrom or with respect thereto,
whether or not such Taxes were correctly or legally imposed or asserted by the
relevant Governmental Authority.  A certificate as to the amount of such payment
or liability delivered to any Lender by the Administrative Agent shall be
conclusive absent manifest error.  Each Lender hereby authorizes the
Administrative Agent to set off and apply any and all amounts at any time owing
to such Lender under any Loan Document or otherwise payable by the
Administrative Agent to the Lender from any other source against any amount due
to the Administrative Agent under this subsection.

 

Section 9.9.                                The Administrative Agent May File
Proofs of Claim.

 

(a)                                 In case of the pendency of any receivership,
insolvency, liquidation, bankruptcy, reorganization, arrangement, adjustment,
composition or other judicial proceeding relative to any Loan Party, the
Administrative Agent (irrespective of whether the principal of any Loan or any
Revolving Credit Exposure shall then be due and payable as herein expressed or
by declaration or otherwise and irrespective of whether the Administrative Agent
shall have made any demand on any Borrower) shall be entitled and empowered, by
intervention in such proceeding or otherwise:

 

(i)                                     to file and prove a claim for the whole
amount of the principal and interest owing and unpaid in respect of the Loans or
Revolving Credit Exposure and all other Obligations that are owing and unpaid
and to file such other documents as may be necessary or advisable in order to
have the claims of the Lenders, the Issuing Bank and the Administrative Agent
(including any claim for the reasonable compensation, expenses, disbursements
and advances of the Lenders, the Issuing Bank and the Administrative Agent and
its agents and counsel and all other amounts due the Lenders, the Issuing Bank
and the Administrative Agent under Section 10.3) allowed in such judicial
proceeding; and

 

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

 

(b)                                 Any custodian, receiver, assignee, trustee,
liquidator, sequestrator or other similar official in any such judicial
proceeding is hereby authorized by each Lender and the Issuing Bank to make such
payments to the Administrative Agent and, if the Administrative Agent shall
consent to the making of such payments directly to the Lenders and the Issuing
Bank, to pay to the Administrative Agent any amount due for the reasonable
compensation, expenses, disbursements and advances of the Administrative Agent
and its agents and counsel, and any other amounts due the Administrative Agent
under Section 10.3.

 

Nothing contained herein shall be deemed to authorize the Administrative Agent
to authorize or consent to or accept or adopt on behalf of any Lender or the
Issuing Bank any plan

 

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of reorganization, arrangement, adjustment or composition affecting the
Obligations or the rights of any Lender or to authorize the Administrative Agent
to vote in respect of the claim of any Lender in any such proceeding.

 

Section 9.10.                         Authorization to Execute Other Loan
Documents.  Each Lender hereby authorizes the Administrative Agent to execute on
behalf of all Lenders all Loan Documents (including, without limitation, the
Collateral Documents and any subordination agreements) other than this
Agreement.

 

Section 9.11.                         Collateral and Guaranty Matters.  The
Lenders irrevocably authorize the Administrative Agent, at its option and in its
discretion:

 

(a)                                 to release any Lien on any property granted
to or held by the Administrative Agent under any Loan Document (i) upon the
termination of all Revolving Commitments, the Cash Collateralization of all
reimbursement obligations with respect to Letters of Credit in an amount equal
to 105% of the aggregate LC Exposure of all Lenders, and the payment in full of
all Obligations (other than contingent indemnification obligations and such Cash
Collateralized reimbursement obligations), (ii) that is sold or to be sold as
part of or in connection with any sale permitted hereunder or under any other
Loan Document, or (iii) if approved, authorized or ratified in writing in
accordance with Section 10.2; and

 

(b)                                 to release any Loan Party from its
obligations under the applicable Collateral Documents if such Person ceases to
be a Subsidiary as a result of a transaction permitted hereunder.

 

Upon request by the Administrative Agent at any time, the Required Lenders will
confirm in writing the Administrative Agent’s authority to release its interest
in particular types or items of property, or to release any Loan Party from its
obligations under the applicable Collateral Documents pursuant to this Section. 
In each case as specified in this Section, the Administrative Agent is
authorized, at the Borrowers’ expense, to execute and deliver to the applicable
Loan Party such documents as such Loan Party may reasonably request to evidence
the release of such item of Collateral from the Liens granted under the
applicable Collateral Documents, or to release such Loan Party from its
obligations under the applicable Collateral Documents, in each case in
accordance with the terms of the Loan Documents and this Section.

 

Section 9.12.                         [Reserved.]

 

Section 9.13.                                                       Right to
Realize on Collateral and Enforce Guarantee.  Anything contained in any of the
Loan Documents to the contrary notwithstanding, each of the Parent, each
Borrower, the Administrative Agent and each Lender hereby agree that (i) no
Lender shall have any right individually to realize upon any of the Collateral
or to enforce the Collateral Documents, it being understood and agreed that all
powers, rights and remedies hereunder and under the Collateral Documents may be
exercised solely by the Administrative Agent, and (ii) in the event of a
foreclosure by the Administrative Agent on any of the Collateral pursuant to a
public or private sale or other disposition, the Administrative Agent or any
Lender may be the purchaser or licensor of any or all of such Collateral at any
such sale or other disposition and the Administrative Agent, as agent for and
representative of the Lenders (but not any Lender or Lenders in its or their
respective individual capacities unless the Required Lenders shall

 

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otherwise agree in writing), shall be entitled, for the purpose of bidding and
making settlement or payment of the purchase price for all or any portion of the
Collateral sold at any such public sale, to use and apply any of the Obligations
as a credit on account of the purchase price for any collateral payable by the
Administrative Agent at such sale or other disposition.

 

Section 9.14.                                                       Secured Bank
Product Obligations and Hedging Obligations.  No Bank Product Provider or
Lender-Related Hedge Provider that obtains the benefits of Section 8.2, the
Collateral Documents or any Collateral by virtue of the provisions hereof or of
any other Loan Document shall have any right to notice of any action or to
consent to, direct or object to any action hereunder or under any other Loan
Document or otherwise in respect of the Collateral (including the release or
impairment of any Collateral) other than in its capacity as a Lender and, in
such case, only to the extent expressly provided in the Loan Documents. 
Notwithstanding any other provision of this Article to the contrary, the
Administrative Agent shall not be required to verify the payment of, or that
other satisfactory arrangements have been made with respect to, Bank Product
Obligations and Hedging Obligations unless the Administrative Agent has received
written notice of such Obligations, together with such supporting documentation
as the Administrative Agent may request, from the applicable Bank Product
Provider or Lender-Related Hedge Provider, as the case may be.

 

ARTICLE X

 

MISCELLANEOUS

 

Section 10.1.                         Notices.

 

(a)                                 Written Notices.

 

(i)                                     Except in the case of notices and other
communications expressly permitted to be given by telephone, or, subject to the
provisions of Section 10.1(b), email, all notices and other communications to
any party herein to be effective shall be in writing and shall be delivered by
hand or overnight courier service, mailed by certified or registered mail or
sent by telecopy, as follows:

 

To the Borrowers:

TESSCO Technologies Incorporated

 

375 W. Padonia Road

 

Timonium, MD 21093

 

Attention: Aric Spitulnik, Chief Financial Officer

 

Telecopy Number: 410-229-1679

 

 

With a copy to (for

 

information purposes only):

Ballard Spahr, LLP

 

1735 Market Street

 

Philadelphia, PA 19103-7599

 

Attention: Richard Perelman

 

Telecopy Number 215-864-8999

 

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To the Administrative Agent:

SunTrust Bank

 

303 Peachtree Street, N.E., 23rd Floor

 

Mail Code: GA — Atlanta 1981

 

Atlanta, Georgia 30308

 

Attention: Portfolio Manager — TESSCO

 

Telecopy Number: (404) 813-5890

 

 

With a copy to (for

 

information purposes only):

SunTrust Bank

 

Agency Services

 

303 Peachtree Street, N.E. / 25th Floor

 

Atlanta, Georgia 30308

 

Attention: Doug Weltz

 

Telecopy Number: (404) 221-2001

 

 

To the Issuing Bank:

 

 

 

 

SunTrust Bank

 

Attn: Standby Letter of Credit Dept.

 

245 Peachtree Center Ave., 17th FL

 

Atlanta, GA 30303

 

Telephone: 800-951-7847

 

 

To the Swingline Lender:

 

 

 

 

SunTrust Bank Agency Services

 

303 Peachtree Street, N.E. / 25th Floor

 

Atlanta, Georgia 30308

 

Attention: Doug Weltz

 

Telecopy Number: (404) 221-2001

 

 

To any other Lender:

the address set forth in the Administrative Questionnaire or the Assignment and
Acceptance executed by such Lender

 

Any party hereto may change its address or telecopy number for notices and other
communications hereunder by notice to the other parties hereto.  All such
notices and other communications shall be effective upon actual receipt by the
relevant Person or, if delivered by overnight courier service, upon the first
Business Day after the date deposited with such courier service for overnight
(next-day) delivery or, if sent by telecopy, upon transmittal in legible form by
facsimile machine, or, if sent by certified or registered mail, upon receipt,
or, if delivered by hand, upon delivery; provided that notices delivered to the
Administrative Agent, the Issuing Bank or the Swingline Lender shall not be
effective until actually received by such Person at its address specified in
this Section.

 

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(ii)                                  Any agreement of the Administrative Agent,
the Issuing Bank or any Lender herein to receive certain notices by telephone,
email, or facsimile is solely for the convenience and at the request of the
Borrower Agent.  The Administrative Agent, the Issuing Bank and each Lender
shall be entitled to rely on the authority of any Person purporting to be a
Person authorized by Borrower Agent to give such notice and the Administrative
Agent, the Issuing Bank and the Lenders shall not have any liability to Parent,
any Borrower, or other Person on account of any action taken or not taken by the
Administrative Agent, the Issuing Bank or any Lender in reliance upon such
telephonic, email, or facsimile notice.  The obligation of the Borrowers to
repay the Loans and all other Obligations hereunder shall not be affected in any
way or to any extent by any failure of the Administrative Agent, the Issuing
Bank or any Lender to receive written confirmation of any telephonic, email, or
facsimile notice or the receipt by the Administrative Agent, the Issuing Bank or
any Lender of a confirmation which is at variance with the terms understood by
the Administrative Agent, the Issuing Bank and such Lender to be contained in
any such telephonic, email, or facsimile notice.

 

(b)                                 Electronic Communications.

 

(i)                                     Notices and other communications to the
Lenders and the Issuing Bank hereunder may be delivered or furnished by
electronic communication (including e-mail and Internet or intranet websites)
pursuant to procedures approved by the Administrative Agent, provided that the
foregoing shall not apply to notices to any Lender or the Issuing Bank pursuant
to Article II unless such Lender, the Issuing Bank, as applicable, and the
Administrative Agent have agreed to receive notices under any Section thereof by
electronic communication and have agreed to the procedures governing such
communications.  The Administrative Agent or the Borrower Agent may, in its
discretion, agree to accept notices and other communications to it hereunder by
electronic communications pursuant to procedures approved by it; provided that
approval of such procedures may be limited to particular notices or
communications.

 

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

 

(iii)                                                                              
The Parent and each Borrower agree that the Administrative Agent may, but shall
not be obligated to, make Communications (as defined below) available to the
Issuing Bank and the other Lenders by posting the Communications on Debt
Domain, Intralinks, Syndtrak, ClearPar or a substantially similar Electronic
System.

 

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(iv) Any Electronic System used by the Administrative Agent is provided “as is”
and “as available.”  The Agent Parties (as defined below) do not warrant the
adequacy of such Electronic Systems and expressly disclaim liability for errors
or omissions in the Communications.  No warranty of any kind, express, implied
or statutory, including, without limitation, any warranty of merchantability,
fitness for a particular purpose, non-infringement of third-party rights or
freedom from viruses or other code defects, is made by any Agent Party in
connection with the Communications or any Electronic System.  In no event shall
the Administrative Agent or any of its Related Parties (collectively, the “Agent
Parties”) have any liability to any Loan Party, any Lender, the Issuing Bank or
any other Person or entity for damages of any kind, including, without
limitation, direct or indirect, special, incidental or consequential damages,
losses or expenses (whether in tort, contract or otherwise) arising out of any
Loan Party’s or the Administrative Agent’s transmission of Communications
through an Electronic System.  “Communications” means, collectively, any notice,
demand, communication, information, document or other material provided by or on
behalf of any Loan Party pursuant to any Loan Document or the transactions
contemplated therein which is distributed by the Administrative Agent, any
Lender or the Issuing Bank by means of electronic communications pursuant to
this Section, including through an Electronic System.

 

(c)                                  Certification of Public Information.  The
Parent, each Borrower and each Lender acknowledge that certain of the Lenders
may be Public Lenders and, if documents or notices required to be delivered
pursuant to Section 5.1 or Section 5.2 otherwise are being distributed through
Syndtrak, Intralinks or any other Internet or intranet website or other
information platform (the “Platform”), any document or notice that the Borrower
has indicated contains Non-Public Information shall not be posted on that
portion of the Platform designated for such Public Lenders.  The Borrower Agent
agrees to clearly designate all information provided to the Administrative Agent
by or on behalf of the Loan Parties which is suitable to make available to
Public Lenders.  If the Borrower has not indicated whether a document or notice
delivered pursuant to Section 5.1 or Section 5.2 contains Non-Public
Information, the Administrative Agent reserves the right to post such document
or notice solely on that portion of the Platform designated for Lenders who wish
to receive Non-Public Information.

 

(d)                                 Private Side Information Contacts.  Each
Public Lender agrees to cause at least one individual at or on behalf of such
Public Lender to at all times have selected the “Private Side Information” or
similar designation on the content declaration screen of the Platform in order
to enable such Public Lender or its delegate, in accordance with such Public
Lender’s compliance procedures and applicable law, including Unites States
federal and state securities laws, to make reference to information that is not
made available through the “Public Side Information” portion of the Platform and
that may contain Non-Public Information with respect to the Parent, any
Borrower, its Affiliates or any of their securities or loans for purposes of
United States federal or state securities laws.  In the event that any Public
Lender has determined for itself not to access any information disclosed through
the Platform or otherwise, such Public Lender acknowledges that (i) other
Lenders may have availed themselves of such information and (ii) none of the
Parent, any Borrower, nor the Administrative Agent has any responsibility for
such Public Lender’s decision to limit the scope of the information it has
obtained in connection with this Agreement and the other Loan Documents.

 

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Section 10.2.                         Waiver; Amendments.

 

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

 

(b)                                 No amendment or waiver of any provision of
this Agreement or of the other Loan Documents (other than the Fee Letter), nor
consent to any departure by the Loan Parties therefrom, shall in any event be
effective unless the same shall be in writing and signed by each of the Parent,
each Borrower, and the Required Lenders, or each of the Parent, each Borrower,
and the Administrative Agent with the consent of the Required Lenders, and then
such amendment, waiver or consent shall be effective only in the specific
instance and for the specific purpose for which given; provided that, in
addition to the consent of the Required Lenders, no amendment, waiver or consent
shall:

 

(i)                                     increase the Commitment of any Lender
without the written consent of such Lender;

 

(ii)                                  reduce the principal amount of any Loan or
reimbursement obligation with respect to a LC Disbursement or reduce the rate of
interest thereon, (other than to waive the Default Interest), or reduce any fees
payable hereunder, without the written consent of each Lender affected thereby;

 

(iii)                               postpone the date fixed for any payment of
any principal of, or interest on, any Loan or LC Disbursement or any fees
hereunder or reduce the amount of, waive or excuse any such payment (other than
to waive the Default Interest), or postpone the scheduled date for the
termination or reduction of any Commitment, without the written consent of each
Lender affected thereby;

 

(iv)                              change Section 2.23(b) or (c) in a manner that
would alter the pro rata sharing of payments required thereby, without the
written consent of each Lender;

 

(v)                                 change any of the provisions of this
subsection (b) or the definition of “Required Lenders” or “Supermajority
Lenders” or any other provision hereof specifying the number or percentage of
Lenders which are required to waive, amend or modify any

 

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rights hereunder or make any determination or grant any consent hereunder,
without the consent of each Lender;

 

(vi)                              release all or substantially all of the
guarantors, or limit the liability of such guarantors, under any guaranty
agreement guaranteeing any of the Obligations, without the written consent of
each Lender;

 

(vii)                           release all or substantially all collateral (if
any) securing any of the Obligations, without the written consent of each
Lender; or

 

(viii)  (A) increase the advance rates specified in the definition of Borrowing
Base or (B) otherwise change the definition of Availability or Borrowing Base or
any of the definitions used therein if the effect thereof is to increase
Availability, without the written consent of Supermajority Lenders;

 

(ix)  change Section 8.2, without the written consent of each Lender; or

 

(x) subordinate the Obligations to any other Indebtedness or subordinate the
Liens securing the Obligations to any other Liens (except as expressly
contemplated hereby), without the written consent of each Lender;

 

provided, further, that no such amendment, waiver or consent shall amend, modify
or otherwise affect the rights, duties or obligations of the Administrative
Agent, the Swingline Lender or the Issuing Bank without the prior written
consent of such Person.

 

(c)                                  Notwithstanding anything to the contrary
herein, no Defaulting Lender shall have any right to approve or disapprove any
amendment, waiver or consent hereunder, except that the Commitment of such
Lender may not be increased or extended, and amounts payable to such Lender
hereunder may not be permanently reduced, without the consent of such Lender
(other than reductions in fees and interest in which such reduction does not
disproportionately affect such Lender).  Notwithstanding anything contained
herein to the contrary, this Agreement may be amended and restated without the
consent of any Lender (but with the consent of the Parent, each Borrower, and
the Administrative Agent) if, upon giving effect to such amendment and
restatement, such Lender shall no longer be a party to this Agreement (as so
amended and restated), the Commitments of such Lender shall have terminated (but
such Lender shall continue to be entitled to the benefits of Sections 2.20, 2.22
and 10.3), such Lender shall have no other commitment or other obligation
hereunder and such Lender shall have been paid in full all principal, interest
and other amounts owing to it or accrued for its account under this Agreement.

 

(d)                                 Notwithstanding anything to the contrary
herein, the Administrative Agent may, with the consent of the Borrower Agent
only, amend, modify or supplement any Loan Document to cure any ambiguity,
omission, mistake, defect or inconsistency.

 

(e)                                  Notwithstanding anything to the contrary
herein, this Agreement may be amended (or amended and restated) with the written
consent of the Required Lenders, the Administrative Agent, the Parent and the
Borrowers (i) to add one or more additional credit facilities to this Agreement,
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

 

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the other Loan Documents, the Revolving Credit Exposure and any Incremental
Facility and the accrued interest and fees in respect thereof and to include
appropriately the Lenders holding such credit facilities in any determination of
the Required Lenders and (ii) to change, modify or alter Section 2.23(b) or
(c) or any other provision hereof relating to pro rata sharing of payments among
the Lenders to the extent necessary to effectuate any of the amendments (or
amendments and restatements) enumerated in subsection (d) or (e)(i) of this
Section.

 

Section 10.3.                         Expenses; Indemnification.

 

(a)                                 The Borrowers shall pay (i) all reasonable,
out-of-pocket costs and expenses of the Administrative Agent and its Affiliates,
including the reasonable fees, charges and disbursements of counsel for the
Administrative Agent and its Affiliates, in connection with the syndication of
the credit facilities provided for herein, the preparation and administration of
the Loan Documents and any amendments, modifications or waivers thereof (whether
or not the transactions contemplated in this Agreement or any other Loan
Document shall be consummated), including the reasonable fees, charges and
disbursements of counsel for the Administrative Agent and its Affiliates,
(ii) all reasonable out-of-pocket expenses incurred by the Issuing Bank in
connection with the issuance, amendment, renewal or extension of any Letter of
Credit or any demand for payment thereunder and (iii) all out-of-pocket costs
and expenses (including, without limitation, the reasonable fees, charges and
disbursements of outside counsel but not the allocated cost of inside counsel)
incurred by the Administrative Agent, the Issuing Bank or any Lender in
connection with the enforcement or protection of its rights in connection with
this Agreement, including its rights under this Section, or in connection with
the Loans made or any Letters of Credit issued hereunder, including all such
out-of-pocket expenses incurred during any workout, restructuring or
negotiations in respect of such Loans or Letters of Credit.

 

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

 

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regardless of whether any Indemnitee is a party thereto; provided that such
indemnity shall not, as to any Indemnitee, be available to the extent that such
losses, claims, damages, liabilities or related expenses are determined by a
court of competent jurisdiction by final and non-appealable judgment to have
resulted from (x) the gross negligence or willful misconduct of such Indemnitee
or (y) a claim brought by the Parent or any other Loan Party against an
Indemnitee for breach in bad faith of such Indemnitee’s obligations hereunder or
under any other Loan Document.  No Indemnitee shall be liable for any damages
arising from the use by others of any information or other materials obtained
through any Platform, except as a result of such Indemnitee’s gross negligence
or willful misconduct as determined by a court of competent jurisdiction in a
final and non-appealable judgment.

 

(c)                                  The Borrowers shall pay, and hold the
Administrative Agent, the Issuing Bank and each of the Lenders harmless from and
against, any and all present and future stamp, documentary, and other similar
taxes with respect to this Agreement and any other Loan Documents, any
collateral described therein or any payments due thereunder, and save the
Administrative Agent, the Issuing Bank and each Lender harmless from and against
any and all liabilities with respect to or resulting from any delay or omission
to pay such taxes.

 

(d)                                 To the extent that any Borrower fails to pay
any amount required to be paid to the Administrative Agent, the Issuing Bank or
the Swingline Lender under subsection (a), (b) or (c) hereof, each Lender
severally agrees to pay to the Administrative Agent, the Issuing Bank or the
Swingline Lender, as the case may be, such Lender’s Pro Rata Share (in
accordance with its respective Revolving Commitment (or Revolving Credit
Exposure, as applicable) determined as of the time that the unreimbursed expense
or indemnity payment is sought) of such unpaid amount; provided that the
unreimbursed expense or indemnified payment, claim, damage, liability or related
expense, as the case may be, was incurred by or asserted against the
Administrative Agent, the Issuing Bank or the Swingline Lender in its capacity
as such.

 

(e)                                  To the extent permitted by applicable law,
neither Parent nor any Borrower shall assert, and hereby waives, any claim
against any Indemnitee, on any theory of liability, for special, indirect,
consequential or punitive damages (as opposed to actual or direct damages)
arising out of, in connection with or as a result of this Agreement, any other
Loan Document or any agreement or instrument contemplated hereby, the
transactions contemplated therein, any Loan or any Letter of Credit or the use
of proceeds thereof; provided, that nothing in this clause (e) shall relieve
Parent or any Borrower of any obligation it may have to indemnify any Indemnitee
against special, indirect, consequential or punitive damages asserted against
such Indemnitee by a third party.

 

(f)                                   All amounts due under this Section shall
be payable promptly after written demand therefor.

 

Section 10.4.                         Successors and Assigns.

 

(a)                                 The provisions of this Agreement shall be
binding upon and inure to the benefit of the parties hereto and their respective
successors and assigns permitted hereby, except that none of the Parent nor any
Borrower may assign or otherwise transfer any of its rights or obligations
hereunder without the prior written consent of the Administrative Agent and each
Lender, and no Lender may assign or otherwise transfer any of its rights or
obligations hereunder except (i) to an

 

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assignee in accordance with the provisions of subsection (b) of this Section,
(ii) by way of participation in accordance with the provisions of subsection
(d) of this Section or (iii) by way of pledge or assignment of a security
interest subject to the restrictions of subsection (f) of this Section (and any
other attempted assignment or transfer by any party hereto shall be null and
void).  Nothing in this Agreement, expressed or implied, shall be construed to
confer upon any Person (other than the parties hereto, their respective
successors and assigns permitted hereby, Participants to the extent provided in
subsection (d) of this Section and, to the extent expressly contemplated hereby,
the Related Parties of each of the Administrative Agent and the Lenders) any
legal or equitable right, remedy or claim under or by reason of this Agreement.

 

(b)                                 Any Lender may at any time assign to one or
more assignees all or a portion of its rights and obligations under this
Agreement (including all or a portion of its Commitments, Loans and other
Revolving Credit Exposure at the time owing to it); provided that any such
assignment shall be subject to the following conditions:

 

(i)                                     Minimum Amounts.

 

(A)                               in the case of an assignment of the entire
remaining amount of the assigning Lender’s Commitments, Loans and other
Revolving Credit Exposure at the time owing to it or in the case of an
assignment to a Lender, an Affiliate of a Lender or an Approved Fund, no minimum
amount need be assigned; and

 

(B)                               in any case not described in subsection
(b)(i)(A) of this Section, the aggregate amount of the Commitment (which for
this purpose includes Loans and Revolving Credit Exposure outstanding
thereunder) or, if the applicable Commitment is not then in effect, the
principal outstanding balance of the Loans and Revolving Credit Exposure of the
assigning Lender subject to each such assignment (determined as of the date the
Assignment and Acceptance with respect to such assignment is delivered to the
Administrative Agent or, if “Trade Date” is specified in the Assignment and
Acceptance, as of the Trade Date) shall not be less than $5,000,000 and in
minimum increments of $1,000,000, unless each of the Administrative Agent and,
so long as no Event of Default has occurred and is continuing, the Borrower
Agent otherwise consents (each such consent not to be unreasonably withheld or
delayed).

 

(ii)                                  Proportionate Amounts.  Each partial
assignment shall be made as an assignment of a proportionate part of all the
assigning Lender’s rights and obligations under this Agreement with respect to
the Loans, other Revolving Credit Exposure or the Commitments assigned.

 

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

 

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

 

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(B)                               the consent of the Administrative Agent (such
consent not to be unreasonably withheld or delayed) shall be required unless
such assignment is to a Lender, an Affiliate of such Lender or an Approved Fund
of such Lender; and

 

(C)                               the consent of the Issuing Bank (such consent
not to be unreasonably withheld or delayed) shall be required for any assignment
that increases the obligation of the assignee to participate in exposure under
one or more Letters of Credit (whether or not then outstanding), and the consent
of the Swingline Lender (such consent not to be unreasonably withheld or
delayed) shall be required for any assignment in respect of the Revolving
Commitments.

 

(iv)                              Assignment and Acceptance.  The parties to
each assignment shall deliver to the Administrative Agent (A) a duly executed
Assignment and Acceptance, (B) a processing and recordation fee of $3,500,
(C) an Administrative Questionnaire unless the assignee is already a Lender and
(D) the documents required under Section 2.22(f).

 

(v)                                 No Assignment to the Certain Persons.  No
such assignment shall be made to (A) the Parent or any of the Parent’s
Affiliates or Subsidiaries or (B) to any Defaulting Lender or any of its
Subsidiaries, or any Person who, upon becoming a Lender hereunder, would
constitute any of the foregoing Persons described in this clause (B).

 

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

 

(vii)                           Certain Additional Payments.  In connection with
any assignment of rights and obligations of any Defaulting Lender hereunder, no
such assignment shall be effective unless and until, in addition to the other
conditions thereto set forth herein, the parties to the assignment shall make
such additional payments to the Administrative Agent in an aggregate amount
sufficient, upon distribution thereof as appropriate (which may be outright
payment, purchases by the assignee of participations or subparticipations, or
other compensating actions, including funding, with the consent of the Borrower
Agent and the Administrative Agent, the applicable pro rata share of Loans
previously requested but not funded by the Defaulting Lender, to each of which
the applicable assignee and assignor hereby irrevocably consent), to (x) pay and
satisfy in full all payment liabilities then owed by such Defaulting Lender to
the Administrative Agent, the Issuing Bank, the Swingline Lender and each other
Lender hereunder (and interest accrued thereon), and (y) acquire (and fund as
appropriate) its full pro rata share of all Loans and participations in Letters
of Credit and Swingline Loans.  Notwithstanding the foregoing, if any assignment
of rights and obligations of any Defaulting Lender hereunder shall become
effective under applicable law without compliance with the provisions of this
paragraph, then the assignee of such interest shall be deemed to be a Defaulting
Lender for all purposes of this Agreement until such compliance occurs.

 

Subject to acceptance and recording thereof by the Administrative Agent pursuant
to subsection (c) of this Section, from and after the effective date specified
in each Assignment and Acceptance, the assignee thereunder shall be a party to
this Agreement and, to the extent of the

 

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interest assigned by such Assignment and Acceptance, have the rights and
obligations of a Lender under this Agreement, and the assigning Lender
thereunder shall, to the extent of the interest assigned by such Assignment and
Acceptance, be released from its obligations under this Agreement (and, in the
case of an Assignment and Acceptance covering all of the assigning Lender’s
rights and obligations under this Agreement, such Lender shall cease to be a
party hereto) but shall continue to be entitled to the benefits of
Sections 2.20, 2.22 and 10.3 with respect to facts and circumstances occurring
before the effective date of such assignment; provided that, except to the
extent otherwise expressly agreed by the affected parties, no assignment by a
Defaulting Lender will constitute a waiver or release of any claim of any party
hereunder arising from such Lender’s having been a Defaulting Lender.  Any
assignment or transfer by a Lender of rights or obligations under this Agreement
that does not comply with this subsection shall be treated for purposes of this
Agreement as a sale by such Lender of a participation in such rights and
obligations in accordance with subsection (d) of this Section.  If the consent
of the Borrower Agent to an assignment is required hereunder (including a
consent to an assignment which does not meet the minimum assignment thresholds
specified above), the Borrower Agent shall be deemed to have given its consent
unless it shall object thereto by written notice to the Administrative Agent
within five Business Days after notice thereof has actually been delivered by
the assigning Lender (through the Administrative Agent) to the Borrower Agent.

 

(c)                                  The Administrative Agent, acting solely for
this purpose as a non-fiduciary agent of the Borrowers, shall maintain at one of
its offices in Atlanta, Georgia, a copy of each Assignment and Acceptance
delivered to it and a register for the recordation of the names and addresses of
the Lenders, and the Commitments of, and principal amount of the Loans and
Revolving Credit Exposure owing to, each Lender pursuant to the terms hereof
from time to time (the “Register”).  Information contained in the Register with
respect to any Lender shall be available for inspection by such Lender at any
reasonable time and from time to time upon reasonable prior notice; information
contained in the Register shall also be available for inspection by the
Borrowers at any reasonable time and from time to time upon reasonable prior
notice.  In establishing and maintaining the Register, the Administrative Agent
shall serve as Parent and each Borrower’s agent solely for tax purposes and
solely with respect to the actions described in this Section, and each of Parent
and each Borrower hereby agrees that, to the extent SunTrust Bank serves in such
capacity, SunTrust Bank and its officers, directors, employees, agents,
sub-agents and affiliates shall constitute “Indemnitees.”

 

(d)                                 Any Lender may at any time, without the
consent of, or notice to, any Loan Party, the Administrative Agent, the
Swingline Lender or the Issuing Bank, sell participations to any Person (other
than a natural person, any Loan Party or any of its Affiliates or Subsidiaries)
(each, a “Participant”) in all or a portion of such Lender’s rights and/or
obligations under this Agreement (including all or a portion of its Commitment
and/or the Loans owing to it); provided that (i) such Lender’s obligations under
this Agreement shall remain unchanged, (ii) such Lender shall remain solely
responsible to the other parties hereto for the performance of such obligations
and (iii) each of Parent and each Borrower, the Administrative Agent, the
Issuing Bank, the Swingline Lender and the other Lenders shall continue to deal
solely and directly with such Lender in connection with such Lender’s rights and
obligations under this Agreement.

 

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Any agreement or instrument pursuant to which a Lender sells such a
participation shall provide that such Lender shall retain the sole right to
enforce this Agreement and to approve any amendment, modification or waiver of
any provision of this Agreement; provided that such agreement or instrument may
provide that such Lender will not, without the consent of the Participant, agree
to any amendment, modification or waiver with respect to the following to the
extent affecting such Participant: (i) increase the Commitment of such Lender;
(ii) reduce the principal amount of any Loan or LC Disbursement or reduce the
rate of interest thereon, or reduce any fees payable hereunder; (iii) postpone
the date fixed for any payment of any principal of, or interest on, any Loan or
LC Disbursement or any fees hereunder or reduce the amount of, waive or excuse
any such payment (other than to waive the Default Interest), or postpone the
scheduled date for the termination or reduction of any Commitment; (iv) change
Section 2.23(b) or (c) in a manner that would alter the pro rata sharing of
payments required thereby; (v) change any of the provisions of
Section 10.2(b) or the definition of “Required Lenders” or “Supermajority
Lenders” or any other provision hereof specifying the number or percentage of
Lenders which are required to waive, amend or modify any rights hereunder or
make any determination or grant any consent hereunder; (vi) release all or
substantially all of the guarantors, or limit the liability of such guarantors,
under any guaranty agreement guaranteeing any of the Obligations; or
(vii) release all or substantially all collateral (if any) securing any of the
Obligations.  Subject to subsection (e) of this Section, each of the Parent and
each Borrower agrees that each Participant shall be entitled to the benefits of
Sections 2.20 and 2.22 to the same extent as if it were a Lender and had
acquired its interest by assignment pursuant to subsection (b) of this Section;
provided that such Participant agrees to be subject to Section 2.26 as though it
were a Lender.  To the extent permitted by law, each Participant also shall be
entitled to the benefits of Section 10.7 as though it were a Lender; provided
that such Participant agrees to be subject to Section 2.23 as though it were a
Lender.

 

Each Lender that sells a participation shall, acting solely for this purpose as
a non-fiduciary agent of each of the Parent and each Borrower, maintain a
register in the United States on which it enters the name and address of each
Participant and the principal amounts (and stated interest) of each
Participant’s interest in the Loans or other obligations under the Loan
Documents (the “Participant Register”).  The entries in the Participant Register
shall be conclusive, absent manifest error, and such Lender shall treat each
person whose name is recorded in the Participant Register as the owner of such
participation for all purposes of this Agreement notwithstanding any notice to
the contrary.  The Borrower Agent and the Administrative Agent shall have
inspection rights to such Participant Register (upon reasonable prior notice to
the applicable Lender) solely for purposes of demonstrating that such Loans or
other obligations under the Loan Documents are in “registered form” for purposes
of the Code. For the avoidance of doubt, the Administrative Agent ( in its
capacity as Administrative Agent) shall have no responsibility for maintaining a
Participant Register.

 

(e)                                  A Participant shall not be entitled to
receive any greater payment under Sections 2.20 and 2.22 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 Loan Parties’ prior written consent.  A Participant
shall not be entitled to the benefits of Section 2.22 unless the Borrower Agent
is notified of the participation sold to such Participant and such Participant
agrees, for the benefit of the Borrowers, to comply with Section 2.22(e) and
(f) as though it were a Lender.

 

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(f)            Any Lender may at any time pledge or assign a security interest
in all or any portion of its rights under this Agreement to secure obligations
of such Lender, including, without limitation, any pledge or assignment to
secure obligations to a Federal Reserve Bank; provided that no such pledge or
assignment shall release such Lender from any of its obligations hereunder or
substitute any such pledgee or assignee for such Lender as a party hereto.

 

Section 10.5.        Governing Law; Jurisdiction; Consent to Service of Process.

 

(a)           This Agreement and the other Loan Documents and any claims,
controversy, dispute or cause of action (whether in contract or tort or
otherwise) based upon, arising out of or relating to this Agreement or any other
Loan Document (except, as to any other Loan Document, as expressly set forth
therein) and the transactions contemplated hereby and thereby shall be construed
in accordance with and be governed by the law (without giving effect to the
conflict of law principles thereof except for Sections 5-1401 and 5-1402 of the
New York General Obligations Law) of the State of New York.

 

(b)           Each of the Parent and each Borrower hereby irrevocably and
unconditionally submits, for itself and its property, to the exclusive
jurisdiction of the United States District Court for the Southern District of
New York, and of the Supreme Court of the State of New York sitting in New York
County, Borough of Manhattan, and of any appellate court from any thereof, in
any action or proceeding arising out of or relating to this Agreement or any
other Loan Document or the transactions contemplated hereby or thereby, or for
recognition or enforcement of any judgment, and each of the parties hereto
hereby irrevocably and unconditionally agrees that all claims in respect of any
such action or proceeding may be heard and determined in such District Court or
New York state court or, to the extent permitted by applicable law, such
appellate court.  Each of the parties hereto agrees that a final judgment in any
such action or proceeding shall be conclusive and may be enforced in other
jurisdictions by suit on the judgment or in any other manner provided by law. 
Nothing in this Agreement or any other Loan Document shall affect any right that
the Administrative Agent, the Issuing Bank or any Lender may otherwise have to
bring any action or proceeding relating to this Agreement or any other Loan
Document against any Loan Party or its properties in the courts of any
jurisdiction.

 

(c)           Each of the Parent and each Borrower irrevocably and
unconditionally waives any objection which it may now or hereafter have to the
laying of venue of any such suit, action or proceeding described in subsection
(b) of this Section and brought in any court referred to in subsection (b) of
this Section.  Each of the parties hereto irrevocably waives, to the fullest
extent permitted by applicable law, the defense of an inconvenient forum to the
maintenance of such action or proceeding in any such court.

 

(d)           Each party to this Agreement irrevocably consents to the service
of process in the manner provided for notices in Section 10.1.  Nothing in this
Agreement or in any other Loan Document will affect the right of any party
hereto to serve process in any other manner permitted by law.

 

Section 10.6.        WAIVER OF JURY TRIAL.  EACH PARTY HERETO IRREVOCABLY
WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE
TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF
THIS AGREEMENT OR

 

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ANY OTHER LOAN DOCUMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY
(WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY).  EACH PARTY HERETO
(A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS
REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE
EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER, AND (B) ACKNOWLEDGES
THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS
AGREEMENT AND THE OTHER LOAN DOCUMENTS BY, AMONG OTHER THINGS, THE MUTUAL
WAIVERS AND CERTIFICATIONS IN THIS SECTION.

 

Section 10.7.        Right of Set-off.  In addition to any rights now or
hereafter granted under applicable law and not by way of limitation of any such
rights, each Lender and the Issuing Bank shall have the right, at any time or
from time to time upon the occurrence and during the continuance of an Event of
Default, without prior notice to any Loan Party, any such notice being expressly
waived by each of the Parent and each Borrower to the extent permitted by
applicable law, to set off and apply against all deposits (general or special,
time or demand, provisional or final) of the Loan Parties at any time held or
other obligations at any time owing by such Lender and the Issuing Bank to or
for the credit or the account of the Borrowers against any and all Obligations
held by such Lender or the Issuing Bank, as the case may be, irrespective of
whether such Lender or the Issuing Bank shall have made demand hereunder and
although such Obligations may be unmatured; provided that if any Defaulting
Lender shall exercise any such right of setoff, (x) all amounts so set off shall
be paid over immediately to the Administrative Agent for further application in
accordance with the provisions of Section 2.28(b) and, pending such payment,
shall be segregated by such Defaulting Lender from its other funds and deemed
held in trust for the benefit of the Administrative Agent, the Issuing Banks,
and the Lenders, and (y) the Defaulting Lender shall provide promptly to the
Administrative Agent a statement describing in reasonable detail the Obligations
owing to such Defaulting Lender as to which it exercised such right of setoff. 
Each Lender and the Issuing Bank agrees promptly to notify the Administrative
Agent and the Borrower Agent after any such set-off and any application made by
such Lender or the Issuing Bank, as the case may be; provided that the failure
to give such notice shall not affect the validity of such set-off and
application.  Each Lender and the Issuing Bank agrees to apply all amounts
collected from any such set-off to the Obligations before applying such amounts
to any other Indebtedness or other obligations owed by any Loan Party and any of
its Subsidiaries to such Lender or the Issuing Bank.

 

Section 10.8.        Counterparts; Integration.  This Agreement may be executed
by one or more of the parties to this Agreement on any number of separate
counterparts, and all of said counterparts taken together shall be deemed to
constitute one and the same instrument.  This Agreement, the Fee Letter, the
other Loan Documents, and any separate letter agreements relating to any fees
payable to the Administrative Agent and its Affiliates constitute the entire
agreement among the parties hereto and thereto and their affiliates regarding
the subject matters hereof and thereof and supersede all prior agreements and
understandings, oral or written, regarding such subject matters.  Delivery of an
executed counterpart to this Agreement or any other Loan Document by facsimile
transmission or by electronic mail in pdf format shall be as effective as
delivery of a manually executed counterpart hereof.

 

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Section 10.9.        Survival.  All covenants, agreements, representations and
warranties made by any Loan Party herein and in the certificates, reports,
notices or other instruments delivered in connection with or pursuant to this
Agreement shall be considered to have been relied upon by the other parties
hereto and shall survive the execution and delivery of this Agreement and the
other Loan Documents and the making of any Loans and issuance of any Letters of
Credit, regardless of any investigation made by any such other party or on its
behalf and notwithstanding that the Administrative Agent, the Issuing Bank or
any Lender may have had notice or knowledge of any Default or incorrect
representation or warranty at the time any credit is extended hereunder, and
shall continue in full force and effect as long as the principal of or any
accrued interest on any Loan or any fee or any other amount payable under this
Agreement is outstanding and unpaid or any Letter of Credit is outstanding and
so long as the Commitments have not expired or terminated.  The provisions of
Sections 2.20, 2.22, and 10.3 and Article IX shall survive and remain in full
force and effect regardless of the consummation of the transactions contemplated
hereby, the repayment of the Loans, the expiration or termination of the Letters
of Credit and the Commitments or the termination of this Agreement or any
provision hereof.

 

Section 10.10.           Severability.  Any provision of this Agreement or any
other Loan Document held to be illegal, invalid or unenforceable in any
jurisdiction, shall, as to such jurisdiction, be ineffective to the extent of
such illegality, invalidity or unenforceability without affecting the legality,
validity or enforceability of the remaining provisions hereof or thereof; and
the illegality, invalidity or unenforceability of a particular provision in a
particular jurisdiction shall not invalidate or render unenforceable such
provision in any other jurisdiction.

 

Section 10.11.           Confidentiality.  Each of the Administrative Agent, the
Issuing Bank and the Lenders agrees to take normal and reasonable precautions to
maintain the confidentiality of any information relating to the Parent or any of
its Subsidiaries or any of their respective businesses, to the extent designated
in writing as confidential and provided to it by the Parent or any of its
Subsidiaries, other than any such information that is available to the
Administrative Agent, the Issuing Bank or any Lender on a non-confidential basis
before disclosure by the Parent or any of its Subsidiaries, except that such
information may be disclosed (i) to any Related Party of the Administrative
Agent, the Issuing Bank or any such Lender including, without limitation,
accountants, legal counsel and other advisors (it being understood that the
Persons to whom such disclosure is made will be informed of the confidential
nature of such information and instructed to keep such information
confidential), (ii) to the extent required by applicable laws or regulations or
by any subpoena or similar legal process (in which case such Person, to the
extent permitted by law and except as disclosure is otherwise permitted under
this Section, shall promptly notify the Borrower Agent thereof, unless, in the
case of any disclosure required as requested by a Governmental Authority, such
Governmental Authority has requested that no such disclosure be made), (iii) to
the extent requested by any regulatory agency or governmental or self-regulating
authority purporting to have jurisdiction over it (including any self-regulatory
authority such as the National Association of Insurance Commissioners), (iv) to
the extent that such information becomes publicly available other than as a
result of a breach of this Section, or which becomes available to the
Administrative Agent, the Issuing Bank, any Lender or any Related Party of any
of the foregoing on a non-confidential basis from a source other than the Parent
or any of its Subsidiaries, (v) in connection with the exercise of any remedy
hereunder or under any other Loan Documents or any suit, action or proceeding
relating to this

 

122

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Agreement or any other Loan Documents or the enforcement of rights hereunder or
thereunder, (vi) subject to execution by such Person of an agreement containing
provisions substantially the same as those of this Section, to (A) any assignee
of or Participant in, or any prospective assignee of or Participant in, any of
its rights or obligations under this Agreement, or (B) any actual or prospective
party (or its Related Parties) to any swap or derivative or other transaction
under which payments are to be made by reference to the Parent and its
obligations, this Agreement or payments hereunder, (vii) to any rating agency,
(viii) to the CUSIP Service Bureau or any similar organization; provided that
the information provided to the CUSIP Bureau shall be limited to the disclosure
of usual and customary information necessary to obtain a CUSIP number or league
table credit, or (ix) with the consent of the Parent.  Any Person required to
maintain the confidentiality of any information as provided for 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 its own
confidential information.  In the event of any conflict between the terms of
this Section and those of any other Contractual Obligation entered into with any
Loan Party (whether or not a Loan Document), the terms of this Section shall
govern.

 

Section 10.12.              Interest Rate Limitation.  Notwithstanding anything
herein to the contrary, if at any time the interest rate applicable to any Loan,
together with all fees, charges and other amounts which may be treated as
interest on such Loan under applicable law (collectively, the “Charges”), shall
exceed the maximum lawful rate of interest (the “Maximum Rate”) which may be
contracted for, charged, taken, received or reserved by a Lender holding such
Loan in accordance with applicable law, the rate of interest payable in respect
of such Loan hereunder, together with all Charges payable in respect thereof,
shall be limited to the Maximum Rate and, to the extent lawful, the interest and
Charges that would have been payable in respect of such Loan but were not
payable as a result of the operation of this Section shall be cumulated and the
interest and Charges payable to such Lender in respect of other Loans or periods
shall be increased (but not above the Maximum Rate therefor) until such
cumulated amount, together with interest thereon at the Federal Funds Rate to
the date of repayment (to the extent permitted by applicable law), shall have
been received by such Lender.

 

Section 10.13.              Waiver of Effect of Corporate Seal.  Each Borrower
represents and warrants that neither it nor any other Loan Party is required to
affix its corporate seal to this Agreement or any other Loan Document pursuant
to any Requirement of Law, agrees that this Agreement is delivered by the Loan
Parties under seal and waives any shortening of the statute of limitations that
may result from not affixing the corporate seal to this Agreement or such other
Loan Documents.

 

Section 10.14.              Patriot Act.  The Administrative Agent and each
Lender hereby notifies the Loan Parties that, pursuant to the requirements of
the Patriot Act, it is required to obtain, verify and record information that
identifies each of the Parent and each Borrower, which information includes the
name and address of such Loan Party and other information that will allow such
Lender or the Administrative Agent, as applicable, to identify such Loan Party
in accordance with the Patriot Act.

 

Section 10.15.              No Advisory or Fiduciary Responsibility.  In
connection with all aspects of each transaction contemplated hereby (including
in connection with any amendment,

 

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waiver or other modification hereof or of any other Loan Document), each
Borrower and each other Loan Party acknowledges and agrees and acknowledges its
Affiliates’ understanding that (i) (A) the services regarding this Agreement
provided by the Administrative Agent and/or the Lenders are arm’s-length
commercial transactions between each Borrower, each other Loan Party and their
respective Affiliates, on the one hand, and the Administrative Agent and the
Lenders, on the other hand, (B) each of the Borrower and the other Loan Parties
have consulted their own legal, accounting, regulatory and tax advisors to the
extent they have deemed appropriate, and (C) the Borrower and each other Loan
Party is capable of evaluating and understanding, and understands and accepts,
the terms, risks and conditions of the transactions contemplated hereby and by
the other Loan Documents; (ii) (A) each of the Administrative Agent and the
Lenders is and has been acting solely as a principal and, except as expressly
agreed in writing by the relevant parties, has not been, is not, and will not be
acting as an advisor, agent or fiduciary for the Borrower, any other Loan Party
or any of their respective Affiliates, or any other Person, and (B) neither the
Administrative Agent nor any Lender has any obligation to the Borrower, any
other Loan Party or any of their Affiliates with respect to the transaction
contemplated hereby except those obligations expressly set forth herein and in
the other Loan Documents; and (iii) the Administrative Agent, the Lenders and
their respective Affiliates may be engaged in a broad range of transactions that
involve interests that differ from those of the Borrower, the other Loan Parties
and their respective Affiliates, and each of the Administrative Agent and the
Lenders has no obligation to disclose any of such interests to the Borrower, any
other Loan Party or any of their respective Affiliates.  To the fullest extent
permitted by law, each of the Borrower and the other Loan Parties hereby waives
and releases any claims that it may have against the Administrative Agent or any
Lender with respect to any breach or alleged breach of agency or fiduciary duty
in connection with any aspect of any transaction contemplated hereby.

 

Section 10.16.              Location of Closing.  Each Lender and the Issuing
Bank acknowledges and agrees that it has delivered, with the intent to be bound,
its executed counterparts of this Agreement to the Administrative Agent, 711 5th
Ave, Suite 1401, Manhattan, New York, 10022-3116.  Each of the Parent and each
Borrower acknowledges and agrees that it has delivered, with the intent to be
bound, its executed counterparts of this Agreement and each other Loan Document,
together with all other documents, instruments, opinions, certificates and other
items required under Section 3.1, to the Administrative Agent, 711 5th Ave,
Suite 1401, Manhattan, New York, 10022-3116.  All parties agree that the closing
of the transactions contemplated by this Agreement has occurred in New York.

 

(Continued on following page.)

 

124

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

 

 

PARENT:

 

 

 

TESSCO TECHNOLOGIES INCORPORATED, a Delaware corporation

 

 

 

 

 

 

 

By:

/s/ Robert B. Barnhill, Jr.

 

Name:

Robert B. Barnhill, Jr.

 

Title:

President

 

 

 

 

BORROWERS:

 

 

 

TESSCO INCORPORATED, a Delaware corporation:

 

 

 

 

 

 

 

By:

/s/ Robert B. Barnhill, Jr.

 

Name:

Robert B. Barnhill, Jr.

 

Title:

President and Chief Executive Officer

 

 

 

 

 

GW SERVICE SOLUTIONS, INC., a Delaware corporation

 

 

 

 

 

 

 

By:

/s/ Robert B. Barnhill, Jr.

 

Name:

Robert B. Barnhill, Jr.

 

Title:

President

 

 

 

 

 

 

 

TESSCO SERVICE SOLUTIONS, INC., a Delaware corporation

 

 

 

 

 

 

 

By:

/s/ Robert B. Barnhill, Jr.

 

Name:

Robert B. Barnhill, Jr.

 

Title:

President

 

[TESSCO—CREDIT AGREEMENT]

 

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

 

 

TCPM, INC., a Delaware corporation

 

 

 

 

 

 

 

By:

/s/ Robert B. Barnhill, Jr.

 

Name:

Robert B. Barnhill, Jr.

 

Title:

President and Chief Executive Officer

 

[TESSCO—CREDIT AGREEMENT]

 

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

 

 

SUNTRUST BANK

 

as the Administrative Agent, as the Issuing Bank, as the Swingline Lender and as
a Lender

 

 

 

 

 

 

 

By:

/s/ Chris Curtis

 

Name:

Chris Curtis

 

Title:

Director

 

[TESSCO—CREDIT AGREEMENT]

 

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

 

SCHEDULE I

 

Commitment Amounts

 

Lender

 

Revolving
Commitment Amount

 

SunTrust Bank

 

$

35,000,000.00

 

 

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

 

SCHEDULE 4.5

 

Environmental Matters

 

None.

 

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

 

SCHEDULE 4.11

 

Real Estate

 

1.                                      Real Estate Owned

 

a.                                      Global Logistics Center, 11126 McCormick
Road, Hunt Valley, Baltimore County, Maryland 21031, titled in the name of
TESSCO Incorporated.

 

b.                                      Americas Logistics Center, 4775
Aircenter Circle, Reno, Washoe County, Nevada 89502, titled in the name of
TESSCO Incorporated.

 

2.                                      Real Estate Leased

 

a.                                      The Atrium Building, 375 West Padonia
Road, Timonium, Baltimore County, Maryland 21093, TESSCO Technologies
Incorporated as Lessee, Atrium Building, LLC as Lessor.

 

b.                                      5250 Prue Road, Building S4, Suite 475,
San Antonio, Bexar County, Texas 78240, GW Service Solutions, Inc. as Lessee,
TDC Prue Road, L.P. as Lessor.

 

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

 

SCHEDULE 4.14

 

Subsidiaries

 

1.                                      Subsidiaries of TESSCO Technologies
Incorporated

 

Name

 

Ownership
Interest

 

Jurisdiction of
Incorporation or
Organization

 

Type of Loan
Party

TESSCO Incorporated

 

100% of outstanding stock

 

Delaware

 

Borrower

GW Service Solutions, Inc.

 

100% of outstanding stock

 

Delaware

 

Borrower

TESSCO Service Solutions, Inc.

 

100% of outstanding stock

 

Delaware

 

Borrower

TCPM, Inc.

 

100% of outstanding stock

 

Delaware

 

Borrower

Wireless Solutions Incorporated

 

100% of outstanding stock

 

Maryland

 

Subsidiary Loan Party

TESSCO Financial Corporation

 

100% of outstanding stock

 

Delaware

 

Subsidiary Loan Party

TESSCO Communications Incorporated

 

100% of outstanding stock

 

Delaware

 

Subsidiary Loan Party

 

2.                                      Subsidiaries of TESSCO Incorporated

 

Name

 

Ownership
Interest

 

Jurisdiction of
Incorporation or
Organization

 

Type of Loan
Party

TESSCO Business Services, LLC

 

100% Membership Interest

 

Delaware

 

Subsidiary Loan Party

 

3.                                      Subsidiaries of TESSCO Service
Solutions, Inc.

 

Name

 

Ownership
Interest

 

Jurisdiction of
Incorporation or
Organization

 

Type of Loan
Party

TESSCO Integrated Solutions, LLC

 

100% Membership Interest

 

Delaware

 

Subsidiary Loan Party

 

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

 

4.                                      Subsidiaries of GW Service
Solutions, Inc.

 

None.

 

5.                                      Subsidiaries of TCPM, Inc.

 

None.

 

6.                                      Subsidiaries of Wireless Solutions
Incorporated

 

None.

 

7.                                      Subsidiaries of TESSCO Financial
Corporation

 

None.

 

8.                                      Subsidiaries of TESSCO Communications
Incorporated

 

None.

 

9.                                      Subsidiaries of TESSCO Business
Services, LLC

 

None.

 

10.                               Subsidiaries of TESSCO Integrated Solutions,
LLC

 

None.

 

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

 

SCHEDULE 4.16

 

Deposit and Disbursement Accounts

 

Account
Number

 

Financial Institution

 

Account Holder

 

Type of Account

 

 

SunTrust Bank
120 East Baltimore Street
Baltimore, MD 21202
410-986-1858

 

TESSCO Technologies Incorporated

 

 

 

 

SunTrust Bank
120 East Baltimore Street
Baltimore, MD 21202
410-986-1858

 

TESSCO Technologies Incorporated

 

 

 

 

SunTrust Bank
120 East Baltimore Street
Baltimore, MD 21202
410-986-1858

 

TESSCO Technologies Incorporated

 

 

 

 

Wells Fargo Bank, NA
7 St. Paul Street
Baltimore, MD 21202
410-332-5715

 

TESSCO Technologies Incorporated

 

 

 

 

Wells Fargo Bank, NA
7 St. Paul Street
Baltimore, MD 21202
410-332-5715

 

TESSCO Technologies Incorporated

 

 

 

 

Royal Bank of Canada
PO Box 56562 STN A
Toronto, ON M5W 4L1
Canada

 

Wells Fargo Bank, NA
7 St. Paul Street
Baltimore, MD 21202
410-332-5715

 

 

 

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

 

SCHEDULE 4.19

 

Material Agreements

 

Amended and Restated Employment Agreement, dated as of March 26, 2016, by and
between TESSCO Technologies Incorporated and Robert B. Barnhill, Jr.

 

Severance and Restrictive Covenant Agreement, dated as of February 2, 2009, by
and between TESSCO Technologies Incorporated and Douglas A. Rein.

 

Severance and Restrictive Covenant Agreement, dated as of May 27, 2014, by and
between TESSCO Technologies Incorporated and Aric Spitulnik.

 

Severance and Restrictive Covenant Agreement, dated as of July 31, 2015, by and
between TESSCO Technologies Incorporated and Craig A. Oldham.

 

Severance and Restrictive Covenant Agreement, dated as of November 2, 2015, by
and between TESSCO Technologies Incorporated and Steven K. Tom.

 

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

 

SCHEDULE 7.1

 

Existing Indebtedness

 

Term loan in the original principal amount of $250,000 with the Baltimore County
Economic Development Revolving Loan Fund, which had a principal balance of
approximately $82,600 as of March 27, 2016.

 

Contingent obligation to purchase, redeem, retire or otherwise acquire for value
Capital Stock of Parent pursuant to awards granted under equity compensation
plans from time to time to employees or directors of the Loan Parties, in
connection with the exercise of such awards or satisfaction of tax liabilities
upon exercise or payment.

 

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

 

SCHEDULE 7.2

 

Existing Liens

 

1.                                      TESSCO Technologies Incorporated

 

Delaware Secretary of State

 

a.                                      Financing Statement showing the secured
party as Hewlett-Packard Financial Services Company, filed on January 14, 2009
as File No. 20090126489.

 

b.                                      Financing Statement showing the secured
party assignee as Wells Fargo Equipment Finance, Inc., filed on January 30, 2012
as File No. 20120363988.

 

c.                                       Financing Statement showing the secured
party as Toyota Motor Credit Corporation filed on February 22, 2013 as File
No. 20130840851.

 

d.                                      Financing Statement showing the secured
party assignee as Wells Fargo Equipment Finance, Inc. filed on May 31, 2013 as
File No. 20132059526.

 

e.                                       Financing Statement showing the secured
party as IBM Credit LLC filed on January 3, 2014 as File No. 20140026187.

 

f.                                        Financing Statement showing the
secured party as IBM Credit LLC filed on January 9, 2014 as File
No. 20140111542.

 

2.                                      TESSCO Incorporated

 

Delaware Secretary of State

 

a.                                      Financing Statement showing the secured
party as Wachovia Bank, National Association, as Collateral Agent, filed on
July 7, 2004 as File No. 20041885955.

 

Land Records for Baltimore County, Maryland

 

a.                                      Indemnity Deed of Trust with Assignment
of Leases, dated as of June 30, 2004, in favor of Well Fargo Bank, National
Association, as successor to Wachovia Bank, National Association, recorded on
June 30, 2004 in Liber 20349, at folio 137, to secure a real estate loan in the
original principal amount of $4,500,000.

 

b.                                      Fixture Filing Financing Statement
showing the secured party as Wachovia Bank NA, recorded on June 30, 2004 in
Liber 20349, at folio 155.

 

c.                                       Indemnity Deed of Trust, Security
Agreement and Assignment of Leases and Rents, dated as of March 31, 2009, in
favor of Baltimore County, Maryland,

 

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

 

recorded on April 1, 2009 in Liber 27863, at folio 443, to secure a loan in the
original principal amount of up to $250,000.

 

d.                                      Fixture Filing Financing Statement
showing the secured party as Wells Fargo National Association, recorded on
September 23, 2015 in Liber 36685, at folio 326.

 

3.                                      GW Service Solutions, Inc.

 

None.

 

4.                                      TESSCO Service Solutions, Inc.

 

None.

 

5.                                      TCPM, Inc.

 

None.

 

6.                                      Wireless Solutions Incorporated

 

None.

 

7.                                      TESSCO Financial Corporation

 

None.

 

8.                                      TESSCO Communications Incorporated

 

None.

 

9.                                      TESSCO Business Services, LLC

 

None.

 

10.                               TESSCO Integrated Solutions, LLC

 

None.

 

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

 

SCHEDULE 7.4

 

Existing Investments

 

None.

 

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