Exhibit 10.1

 

 

 

Published CUSIP Number: 14428UAA6

CREDIT AGREEMENT

Dated as of June 21, 2011

among

CARPENTER TECHNOLOGY CORPORATION

and

CERTAIN SUBSIDIARIES,

as Borrowers,

BANK OF AMERICA, N.A.,

as Administrative Agent, Swing Line Lender and L/C Issuer,

and

THE OTHER LENDERS PARTY HERETO

JPMORGAN CHASE BANK, N.A.,

as Syndication Agent

PNC BANK, NATIONAL ASSOCIATION,

THE BANK OF TOKYO-MITSUBISHI UFJ, LTD., NEW YORK BRANCH

and

SOVEREIGN BANK,

each, as a Documentation Agent

and

MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED,

and

J.P. MORGAN SECURITIES LLC,

as Joint Lead Arrangers and Joint Book Managers

 

 

 

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

TABLE OF CONTENTS

 

           Section        Page  

ARTICLE I DEFINITIONS AND ACCOUNTING TERMS

     2   

1.01

  Defined Terms      2   

1.02

  Other Interpretive Provisions      26   

1.03

  Accounting Terms      26   

1.04

  Rounding      26   

1.05

  Exchange Rates; Currency Equivalents      27   

1.06

  Additional Alternative Currencies      27   

1.07

  Change of Currency      28   

1.08

  Times of Day      28   

1.09

  Letter of Credit Amounts      28   

ARTICLE II THE COMMITMENTS AND CREDIT EXTENSIONS

     28   

2.01

  Committed Loans      28   

2.02

  Borrowings, Conversions and Continuations of Committed Loans      29   

2.03

  Bid Loans      30   

2.04

  Letters of Credit      32   

2.05

  Swing Line Loans      40   

2.06

  Prepayments      43   

2.07

  Termination or Reduction of Commitments      44   

2.08

  Repayment of Loans      44   

2.09

  Interest      44   

2.10

  Fees      45   

2.11

  Computation of Interest and Fees      45   

2.12

  Evidence of Debt      46   

2.13

  Payments Generally; Administrative Agent’s Clawback      46   

2.14

  Sharing of Payments by Lenders      48   

2.15

  Subsidiary Borrowers      48   

2.16

  Increase in Commitments      50   

2.17

  Cash Collateral      51   

2.18

  Defaulting Lenders      51   

ARTICLE III TAXES, YIELD PROTECTION AND ILLEGALITY

     54   

3.01

  Taxes      54   

3.02

  Illegality      57   

3.03

  Inability to Determine Rates      58   

3.04

  Increased Costs      58   

3.05

  Compensation for Losses      60   

3.06

  Mitigation Obligations; Replacement of Lenders      60   

3.07

  Survival      61   

ARTICLE IV CONDITIONS PRECEDENT TO CREDIT EXTENSIONS

     61   

4.01

  Conditions of Initial Credit Extension      61   

 

i

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

TABLE OF CONTENTS

(continued)

 

           Section        Page  

4.02

  Conditions to all Credit Extensions      63   

ARTICLE V REPRESENTATIONS AND WARRANTIES

     63   

5.01

  Existence, Qualification and Power; Compliance with Laws      63   

5.02

  Authorization; No Contravention      64   

5.03

  Governmental and Other Authorizations      64   

5.04

  Binding Effect      64   

5.05

  Financial Condition      64   

5.06

  Litigation      65   

5.07

  No Default      65   

5.08

  Ownership of Property; Liens      65   

5.09

  Environmental Compliance      65   

5.10

  Insurance      65   

5.11

  Taxes      65   

5.12

  ERISA and Foreign Benefit Plan Compliance      66   

5.13

  Subsidiaries      66   

5.14

  Margin Regulation; Investment Company Act      67   

5.15

  Disclosure      67   

5.16

  Intellectual Property      67   

5.17

  Compliance with Laws      67   

5.18

  Representations as to Foreign Obligors      68   

5.19

  OFAC; Anti-Terrorism Laws      68   

ARTICLE VI AFFIRMATIVE COVENANTS

     69   

6.01

  Information      69   

6.02

  Payment of Obligations      71   

6.03

  Preservation of Existence, Etc.      71   

6.04

  Maintenance of Properties      71   

6.05

  Maintenance of Insurance      71   

6.06

  Compliance with Laws      72   

6.07

  Books and Records      72   

6.08

  Inspection Rights      72   

6.09

  Compliance with ERISA      72   

6.10

  Use of Proceeds      72   

6.11

  OFAC; PATRIOT Act Compliance      72   

ARTICLE VII NEGATIVE COVENANTS

     73   

7.01

  Limitation on Indebtedness      73   

7.02

  Restriction on Liens      74   

7.03

  Investments      75   

7.04

  Fundamental Changes      76   

7.05

  Dispositions      77   

7.06

  Restricted Payments      78   

 

ii

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

TABLE OF CONTENTS

(continued)

 

           Section        Page  

7.07

  ERISA      78   

7.08

  Change in Nature of Business      78   

7.09

  Transactions with Affiliates      78   

7.10

  Burdensome Agreements      78   

7.11

  Use of Proceeds      79   

7.12

  Financial Covenants      79   

ARTICLE VIII EVENTS OF DEFAULT AND REMEDIES

     79   

8.01

  Events of Default      79   

8.02

  Remedies Upon Event of Default      81   

8.03

  Application of Funds      82   

ARTICLE IX ADMINISTRATIVE AGENT

     82   

9.01

  Appointment and Authority      82   

9.02

  Rights as a Lender      83   

9.03

  Exculpatory Provisions      83   

9.04

  Reliance by Administrative Agent      84   

9.05

  Delegation of Duties      84   

9.06

  Resignation of Administrative Agent      84   

9.07

  Non-Reliance on Administrative Agent and Other Lenders      85   

9.08

  No Other Duties, Etc.      85   

9.09

  Administrative Agent May File Proofs of Claim      85   

ARTICLE X CONTINUING GUARANTY

     86   

10.01

  Unconditional Guarantee      86   

10.02

  Guarantee Absolute      86   

10.03

  Waivers      87   

10.04

  Subrogation      87   

10.05

  Survival      88   

10.06

  Subordination      88   

10.07

  Stay of Acceleration      88   

10.08

  Condition of Borrower      88   

ARTICLE XI MISCELLANEOUS

     89   

11.01

  Amendments, Etc.      89   

11.02

  Notices; Effectiveness; Electronic Communication      90   

11.03

  No Waiver; Cumulative Remedies; Enforcement      92   

11.04

  Expenses; Indemnity; Damage Waiver      92   

11.05

  Payments Set Aside      94   

11.06

  Successors and Assigns      94   

11.07

  Treatment of Certain Information; Confidentiality      98   

11.08

  Right of Setoff      99   

11.09

  Interest Rate Limitation      99   

 

iii

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

TABLE OF CONTENTS

(continued)

 

           Section        Page  

11.10

  Counterparts; Integration; Effectiveness      99   

11.11

  Survival of Representations and Warranties      100   

11.12

  Severability      100   

11.13

  Replacement of Lenders      100   

11.14

  Governing Law; Jurisdiction; Etc.      101   

11.15

  Waiver of Jury Trial      102   

11.16

  No Advisory or Fiduciary Responsibility      102   

11.17

  Electronic Execution of Assignments and Certain Other Documents      102   

11.18

  USA PATRIOT Act      103   

11.19

  Judgment Currency      103   

 

iv

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

SCHEDULES   

1.01-A

   Existing Letter of Credit

1.01-B

   Mandatory Cost Formulae

2.01

   Commitments and Applicable Percentages

5.13

   Subsidiaries

7.01

   Existing Indebtedness

7.02

   Existing Liens

7.03

   Existing Investments

11.02

   Administrative Agent’s Office; Certain Addresses for Notices EXHIBITS      
Form of:

A

   Committed Loan Notice

B-1

   Bid Request

B-2

   Competitive Bid

C

   Swing Line Loan Notice

D

   Note

E

   Compliance Certificate

F-1

   Assignment and Assumption

F-2

   Administrative Questionnaire

G

   Subsidiary Borrower Request and Assumption Agreement

H

   Subsidiary Borrower Notice

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

CREDIT AGREEMENT

This CREDIT AGREEMENT (“Agreement”) is entered into as of June 21, 2011, among
CARPENTER TECHNOLOGY CORPORATION, a Delaware corporation (“Carpenter”), the
Subsidiary Borrowers (as hereinafter defined and, together with Carpenter, the
“Borrowers” and, each a “Borrower”), each lender from time to time party hereto
(collectively, the “Lenders” and individually, a “Lender”), and BANK OF AMERICA,
N.A., as Administrative Agent, Swing Line Lender and L/C Issuer.

Carpenter has requested that the Lenders provide a revolving credit facility,
and the Lenders are willing to do so on the terms and conditions set forth
herein.

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

ARTICLE I

DEFINITIONS AND ACCOUNTING TERMS

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

“Absolute Rate” means a fixed rate of interest expressed in multiples of 1/100th
of one basis point.

“Absolute Rate Loan” means a Bid Loan that bears interest at a rate determined
with reference to an Absolute Rate.

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

“Administrative Agent’s Fee Letter” means that certain letter agreement, dated
as of May 9, 2011, among the Administrative Agent, Merrill Lynch, Pierce,
Fenner & Smith Incorporated and Carpenter.

“Administrative Agent’s Office” means, with respect to any currency, the
Administrative Agent’s address and, as appropriate, account as set forth on
Schedule 11.02 with respect to such currency, or such other address or account
with respect to such currency as the Administrative Agent may from time to time
notify to Carpenter and the Lenders.

“Administrative Questionnaire” means an Administrative Questionnaire in
substantially the form of Exhibit F-2 or any other form approved by the
Administrative Agent.

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

“Aggregate Commitments” means the Commitments of all the Lenders. The initial
amount of the Aggregate Commitment in effect on the Closing Date is
$350,000,000.

“Agreement” means this Credit Agreement.

 

2

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

“Alternative Currency” means each of Euro, Sterling, Canadian Dollars, Krona,
Singapore Dollars and each other currency (other than Dollars) that is approved
in accordance with Section 1.06.

“Alternative Currency Equivalent” means, at any time, with respect to any amount
denominated in Dollars, the equivalent amount thereof in the applicable
Alternative Currency as determined by the Administrative Agent or the L/C
Issuer, as the case may be, at such time on the basis of the Spot Rate
(determined in respect of the most recent Revaluation Date) for the purchase of
such Alternative Currency with Dollars.

“Applicable Foreign Obligor Documents” has the meaning specified in
Section 5.18(a).

“Applicable Percentage” means with respect to any Lender at any time, the
percentage (carried out to the ninth decimal place) of the Aggregate Commitments
represented by such Lender’s Commitment at such time, subject to adjustment as
provided in Section 2.18. If the commitment of each Lender to make Loans and the
obligation of the L/C Issuer to make L/C Credit Extensions have been terminated
pursuant to Section 8.02 or if the Aggregate Commitments have expired, then the
Applicable Percentage of each Lender shall be determined based on the Applicable
Percentage of such Lender most recently in effect, giving effect to any
subsequent assignments. The initial Applicable Percentage of each Lender is set
forth opposite the name of such Lender on Schedule 2.01 or in the Assignment and
Assumption pursuant to which such Lender becomes a party hereto, as applicable.

“Applicable Rate” means, from time to time, the following percentages per annum,
based upon the Debt Rating as set forth below:

 

Pricing Level

  

Debt Rating

   Facility Fee     Eurocurrency
Rate + Letter of
Credit Fee     Base Rate   1    A- / A3 or better      0.10 %      0.65 %     
0.00 %  2    BBB+ / Baa1      0.15 %      0.85 %      0.00 %  3    BBB / Baa2   
  0.20 %      1.20 %      0.20 %  4    BBB- / Baa3      0.30 %      1.50 %     
0.50 %  5    BB+ / Ba1 or worse      0.45 %      1.95 %      0.95 % 

“Debt Rating” means, as of any date of determination, the rating as determined
by either S&P or Moody’s (collectively, the “Debt Ratings”) of Carpenter’s
non-credit-enhanced, senior unsecured long-term debt; provided that (a) if the
respective Debt Ratings issued by the foregoing rating agencies differ by one
level, then the Pricing Level for the higher of such Debt Ratings shall apply
(with the Debt Rating for Pricing Level 1 being the highest and the Debt Rating
for Pricing Level 5 being the lowest); (b) if there is a split in Debt Ratings
of more than one level, then the Pricing Level that is one level higher than the
Pricing Level of the lower Debt Rating shall apply; (c) if Carpenter has only
one Debt Rating, the Pricing Level that is one level lower than that of such
Debt Rating shall apply; and (d) if Carpenter does not have any Debt Rating,
Pricing Level 5 shall apply.

 

3

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

Initially, the Applicable Rate shall be determined based upon the Debt Rating
specified in the certificate delivered pursuant to Section 4.01(a)(vii).
Thereafter, each change in the Applicable Rate resulting from a publicly
announced change in the Debt Rating shall be effective, in the case of an
upgrade, during the period commencing on the date of delivery by Carpenter to
the Administrative Agent of notice thereof pursuant to Section 6.01(e) (provided
that in the event notice given pursuant to such Section 6.01(e) is delivered on
a date that is after the date a change in the Debt Rating is publicly announced,
the change in the Applicable Rate shall be effective during the period
commencing on the date the change in the Debt Rating was publicly announced if
such announcement date is specified in the notice given pursuant to such
Section 6.01(e)) and ending on the date immediately preceding the effective date
of the next such change and, in the case of a downgrade, during the period
commencing on the date of the public announcement thereof and ending on the date
immediately preceding the effective date of the next such change.

“Applicable Time” means, with respect to any borrowings and payments in any
Alternative Currency, the local time in the place of settlement for such
Alternative Currency as may be determined by the Administrative Agent or the L/C
Issuer, as the case may be, to be necessary for timely settlement on the
relevant date in accordance with normal banking procedures in the place of
payment.

“Applicant Borrower” has the meaning specified in Section 2.15.

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

“Arrangers” means Merrill Lynch, Pierce, Fenner & Smith Incorporated and J.P.
Morgan Securities LLC, in their respective capacities as joint lead arrangers
and joint book managers.

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

“Assignment and Assumption” means an assignment and assumption entered into by a
Lender and an assignee (with the consent of any party whose consent is required
by Section 11.06(b)), and accepted by the Administrative Agent, in substantially
the form of Exhibit F-1 or any other form approved by the Administrative Agent.

“Attributable Indebtedness” means, at any date (a) in respect of any Capital
Lease of any Person, the capitalized amount thereof that would appear on a
balance sheet of such Person prepared as of such date in accordance with GAAP,
(b) in respect of any Synthetic Lease Obligation of any Person, the capitalized
or principal amount of the remaining payments under the relevant lease or other
agreement that would appear on a balance sheet of such Person prepared as of
such date in accordance with GAAP if such lease or other agreement were
accounted for as a Capital Lease and (c) in respect of any Sale/Leaseback
Transaction, the lesser of (i) the present value, discounted in accordance with
GAAP at the debt rate implicit in the related lease, of the obligations of the
lessee for rental payments over the remaining term of such lease (including any
period for which such lease has been extended or may, at the option of the
lessor be extended) and (ii) the fair market value of the assets subject to such
transaction.

“Availability Period” means the period from and including the Closing Date to
the earliest of (a) the Maturity Date, (b) the date of termination of the
Aggregate Commitments pursuant to Section 2.07, and (c) the date of termination
of the commitment of each Lender to make Loans and of the obligation of the L/C
Issuer to make L/C Credit Extensions pursuant to Section 8.02.

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

 

4

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

“Bankruptcy Event” means, with respect to any Person, (a) a court or
governmental agency having jurisdiction in the premises shall enter a decree or
order for relief in respect of such Person in an involuntary case under any
Debtor Relief Law now or hereafter in effect, or appoint a receiver, liquidator,
assignee, custodian, trustee, sequestrator or similar official of such Person or
for any substantial part of its property or ordering the winding up or
liquidation of its affairs, (b) an involuntary case under any applicable Debtor
Relief Law now or hereafter in effect is commenced against such Person and such
petition remains unstayed and in effect for a period of 60 consecutive days,
(c) such Person shall commence a voluntary case under any applicable Debtor
Relief Law now or hereafter in effect, or consent to the entry of an order for
relief in an involuntary case under any such law, or consent to the appointment
or taking possession by a receiver, liquidator, assignee, custodian, trustee,
sequestrator or similar official of such Person or any substantial part of its
property or make any general assignment for the benefit of creditors or (d) such
Person shall admit in writing its inability to pay its debts generally as they
become due or any action shall be taken by such Person in furtherance of any of
the aforesaid purposes.

“Base Rate” means for any day a fluctuating rate per annum equal to the highest
of (a) the Federal Funds Rate plus 1/2 of 1%, (b) the rate of interest in effect
for such day as publicly announced from time to time by Bank of America as its
“prime rate” and (c) except during a Eurocurrency Unavailability Period, a
reference rate equal to the Eurocurrency Base Rate (for Base Rate Loans) plus
1%. The “prime rate” is a rate set by Bank of America based upon various factors
including Bank of America’s costs and desired return, general economic
conditions and other factors, and is used as a reference point for pricing some
loans, which may be priced at, above, or below such announced rate. Any change
in such rate announced by Bank of America shall take effect at the opening of
business on the day specified in the public announcement of such change.

“Base Rate Committed Loan” means a Committed Loan that is a Base Rate Loan.

“Base Rate Loan” means a Loan that bears interest based on the Base Rate. All
Base Rate Loans shall be denominated in Dollars.

“Bid Borrowing” means a borrowing consisting of simultaneous Bid Loans of the
same Type from each of the Lenders whose offer to make one or more Bid Loans as
part of such borrowing has been accepted under the auction bidding procedures
described in Section 2.03.

“Bid Loan” has the meaning specified in Section 2.03(a).

“Bid Loan Lender” means, in respect of any Bid Loan, the Lender making such Bid
Loan to the Borrowers.

“Bid Request” means a written request for one or more Bid Loans substantially in
the form of Exhibit B-1.

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

“Borrower Materials” has the meaning specified in the last paragraph of
Section 6.01.

“Borrowing” means a Committed Borrowing, a Bid Borrowing or a Swing Line
Borrowing, as the context may require.

 

5

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

“Business Day” means any day other than a Saturday, Sunday or other day on which
commercial banks are authorized to close under the Laws of, or are in fact
closed in, the state where the Administrative Agent’s Office with respect to
Obligations denominated in Dollars is located, and:

(a) if such day relates to any interest rate settings as to a Eurocurrency Rate
Loan denominated in Dollars, any fundings, disbursements, settlements and
payments in Dollars in respect of any such Eurocurrency Rate Loan, or any other
dealings in Dollars to be carried out pursuant to this Agreement in respect of
any such Eurocurrency Rate Loan, means any such day on which dealings in
deposits in Dollars are conducted by and between banks in the London interbank
eurodollar market;

(b) if such day relates to any interest rate settings as to a Eurocurrency Rate
Loan denominated in Euro, any fundings, disbursements, settlements and payments
in Euro in respect of any such Eurocurrency Rate Loan, or any other dealings in
Euro to be carried out pursuant to this Agreement in respect of any such
Eurocurrency Rate Loan, means a TARGET Day;

(c) if such day relates to any interest rate settings as to a Eurocurrency Rate
Loan denominated in a currency other than Dollars or Euro, means any such day on
which dealings in deposits in the relevant currency are conducted by and between
banks in the London or other applicable offshore interbank market for such
currency; and

(d) if such day relates to any fundings, disbursements, settlements and payments
in a currency other than Dollars or Euro in respect of a Eurocurrency Rate Loan
denominated in a currency other than Dollars or Euro, or any other dealings in
any currency other than Dollars or Euro to be carried out pursuant to this
Agreement in respect of any such Eurocurrency Rate Loan (other than any interest
rate settings), means any such day on which banks are open for foreign exchange
business in the principal financial center of the country of such currency.

“Canadian Dollars” and “C$” mean the lawful currency of Canada.

“Capital Lease” of any Person means any lease of property (whether real,
personal or mixed) by such Person as lessee which would, in accordance with
GAAP, be required to be accounted for as a capital lease on the balance sheet of
such Person.

“Capital Lease Obligations” means, with respect to any Person, all obligations
of such Person as lessee under Capital Leases, in each case taken at the amount
thereof accounted for as liabilities in accordance with GAAP.

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

“Carpenter’s 2010 Form 10-K” means Carpenter’s annual report on Form 10–K for
the fiscal year ended June 30, 2010, as filed with the SEC pursuant to the
Exchange Act.

“Carpenter’s Latest Form 10-Q” means Carpenter’s quarterly report on Form 10–Q
for the quarter ended March 31, 2011, as filed with the SEC pursuant to the
Exchange Act.

“Cash Collateralize” means to pledge and deposit with or deliver to the
Administrative Agent, for the benefit of the Administrative Agent, L/C Issuer or
Swing Line Lender (as applicable) and the Lenders, as collateral for L/C
Obligations, Obligations in respect of Swing Line Loans, or obligations of
Lenders to fund participations in respect of either thereof (as the context may
require), cash or deposit account balances or, if the L/C Issuer or Swing Line
Lender benefitting from such collateral shall agree in its sole discretion,
other credit support, in each case pursuant to documentation in form and
substance satisfactory

 

6

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

to (a) the Administrative Agent and (b) the L/C Issuer or the Swing Line Lender
(as applicable). “Cash Collateral” shall have a meaning correlative to the
foregoing and shall include the proceeds of such cash collateral and other
credit support.

“Cash Equivalents” means:

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

(b) Dollar–denominated certificates of deposit of (A) any Lender, (B) any United
States commercial bank of recognized standing having capital and surplus in
excess of $500,000,000 or (C) any bank whose (or whose parent company’s)
short–term commercial paper rating from S&P is at least A–1 or the equivalent
thereof or from Moody’s is at least P–1 or the equivalent thereof (any such bank
being an “Approved Bank”), in each case with maturities of not more than 270
days from the date of acquisition;

(c) commercial paper and variable or fixed rate notes issued by any Approved
Bank (or by the parent company thereof) or any variable rate notes issued by, or
guaranteed by, any domestic corporation not an Affiliate of Carpenter rated A–1
(or the equivalent thereof) or better by S&P or P–1 (or the equivalent thereof)
or better by Moody’s and maturing within six months of the date of acquisition;

(d) repurchase agreements with a bank or trust company (including any of the
Lenders) or recognized securities dealer having capital and surplus in excess of
$500,000,000 for direct obligations issued by or fully guaranteed by the United
States of America in which Carpenter or one or more of its Subsidiaries shall
have a perfected first priority security interest (subject to no other Liens)
and having, on the date of purchase thereof, a fair market value of at least
100% of the amount of the repurchase obligations;

(e) Investments, classified in accordance with GAAP as current assets, in money
market investment programs registered under the Investment Company Act of 1940,
as amended, which are administered by reputable financial institutions having
capital of at least $500,000,000 and the portfolios of which are limited to
Investments of the character described in the foregoing clauses (a) through (d);
and

(f) without duplication, any other Marketable Securities recorded as “Cash
Equivalents” on the consolidated balance sheet of Carpenter and its Consolidated
Subsidiaries.

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

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

“Change in Law” means the occurrence, after the date of this Agreement, of any
of the following: (a) the adoption or taking effect of any law, rule, regulation
or treaty, (b) any change in any law, rule, regulation or treaty or in the
administration, interpretation, implementation or application thereof by any
Governmental Authority or (c) the making or issuance of any request, rule,
guideline or directive

 

7

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

(whether or not having the force of law) by any Governmental Authority; provided
that notwithstanding anything herein to the contrary, (x) the Dodd-Frank Wall
Street Reform and Consumer Protection Act and all requests, rules, guidelines or
directives thereunder or issued in connection therewith and (y) all requests,
rules, guidelines or directives promulgated by the Bank for international
settlements, the Basel Committee on Banking 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.

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

(a) any “person” or “group” (as such terms are used in Sections 13(d) and 14(d)
of the Exchange Act, but excluding any employee benefit plan of such person or
its subsidiaries, and any person or entity acting in its capacity as trustee,
agent or other fiduciary or administrator of any such plan) becomes the
“beneficial owner” (as defined in Rules 13d-3 and 13d-5 under the Exchange Act,
except that a person or group shall be deemed to have “beneficial ownership” of
all securities that such person or group has the right to acquire, whether such
right is exercisable immediately or only after the passage of time (such right,
an “option right”)), directly or indirectly, of 35% or more of the equity
securities of Carpenter entitled to vote for members of the board of directors
or equivalent governing body of Carpenter on a fully-diluted basis (and taking
into account all such securities that such person or group has the right to
acquire pursuant to any option right); or

(b) during any period of 12 consecutive months, a majority of the members of the
board of directors or other equivalent governing body of Carpenter cease to be
composed of individuals (i) who were members of that board or equivalent
governing body on the first day of such period, (ii) whose election or
nomination to that board or equivalent governing body was approved by
individuals referred to in clause (i) above constituting at the time of such
election or nomination at least a majority of that board or equivalent governing
body or (iii) whose election or nomination to that board or other equivalent
governing body was approved by individuals referred to in clauses (i) and
(ii) above constituting at the time of such election or nomination at least a
majority of that board or equivalent governing body (excluding, in the case of
both clause (ii) and clause (iii), any individual whose initial nomination for,
or assumption of office as, a member of that board or equivalent governing body
occurs as a result of an actual solicitation of proxies or consents for the
election or removal of one or more directors by any person or group other than a
solicitation for the election of one or more directors by or on behalf of the
board of directors).

“Closing Date” means the first date all the conditions precedent in Section 4.01
are satisfied or waived in accordance with Section 11.01.

“Code” means the Internal Revenue Code of 1986, as amended and the rules and
regulations promulgated thereunder.

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

“Committed Borrowing” means a borrowing consisting of simultaneous Committed
Loans of the same Type, in the same currency and, in the case of Eurocurrency
Rate Loans, having the same Interest Period made by each of the Lenders pursuant
to Section 2.01.

 

8

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

“Committed Loan” has the meaning specified in Section 2.01.

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

“Competitive Bid” means a written offer by a Lender to make one or more Bid
Loans, substantially in the form of Exhibit B-2, duly completed and signed by a
Lender.

“Compliance Certificate” has the meaning specified in Section 6.01(c).

“Consolidated Capitalization” means the sum of, without duplication,
(a) Consolidated Indebtedness and (b) the consolidated stockholders’ equity
(determined in accordance with GAAP) of the common and preferred stockholders of
Carpenter recorded on Carpenter’s consolidated financial statements.

“Consolidated EBITDA” means for any period the sum of (a) Consolidated Net
Income for such period plus (b) an amount which, in the determination of
Consolidated Net Income for such period, has been deducted for (i) Consolidated
Interest Expense, (ii) provisions for Federal, state, local and foreign income,
value added and similar taxes, and (iii) depreciation, amortization (including,
without limitation, amortization of goodwill and other intangibles but excluding
amortization of prepaid cash expenses that were paid in a prior period) and
other non–cash expense (but excluding any such non–cash expense to the extent
that it represents amortization of a prepaid cash expense that was paid in a
prior period or an accrual of, or a reserve for, cash charges or expenses in any
future period); provided that, notwithstanding the foregoing, all
(A) actuarially determined non-cash retiree medical expenses equivalent to any
amount that is funded under the Voluntary Employee Beneficiary Association Trust
established by Carpenter pursuant to Section 501(c)(9) of the Code and
(B) actuarially determined non-cash income or expense related to a Pension Plan
to the extent included in the income statement of Carpenter and its Consolidated
Subsidiaries, shall be excluded from Consolidated Net Income under clause
(b)(iii) above.

“Consolidated Indebtedness” means at any date the Indebtedness of Carpenter and
its Consolidated Subsidiaries, determined on a consolidated basis as of such
date.

“Consolidated Interest Expense” means, for any period, the total interest
expense, including the interest component of all payments under Capital Lease
Obligations and the implied interest component of Synthetic Lease Obligations
(regardless of whether accounted for as interest expense under GAAP), all
commissions, discounts and other fees and charges owed with respect to letters
of credit and bankers’ acceptances that are typically treated as interest
expense in accordance with GAAP, of Carpenter and its Consolidated Subsidiaries,
in each case as determined in accordance with GAAP and as determined on a
consolidated basis for such period.

“Consolidated Net Income” means, for any period, the net income (or net loss)
after taxes of Carpenter and its Consolidated Subsidiaries for such period, as
determined in accordance with GAAP; provided that there shall be excluded from
the calculation of Consolidated Net Income non–operating, non–recurring gains
and losses and extraordinary gains and losses of Carpenter and its Consolidated
Subsidiaries; provided, further, that the net income of any Consolidated
Subsidiary shall be excluded from Consolidated Net Income to the extent that the
declaration or payment of dividends or similar distributions by such
Consolidated Subsidiary from such income is not at the time permitted by the
terms of its charter or by-laws or any judgment, decree, order, law, statute,
rule, regulation, agreement, indenture or other instrument which is binding on
such Consolidated Subsidiary.

 

9

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

“Consolidated Subsidiary” means with respect to any Person at any date any
Subsidiary of such Person or other entity the accounts of which would be
consolidated with those of such Person in its consolidated financial statements
if such statements were prepared as of such date in accordance with GAAP.

“Consolidated Tangible Net Worth” means at any date the consolidated
stockholders’ equity of Carpenter and its Consolidated Subsidiaries, less
intangible assets and goodwill of Carpenter and its Consolidated Subsidiaries,
in each case as determined in accordance with GAAP.

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

“Control” means the possession, directly or indirectly, of the power to direct
or cause the direction of the management or policies of a Person, whether
through the ability to exercise voting power, by contract or otherwise.
“Controlling” and “Controlled” have meanings correlative thereto.

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

“Debt to Capital Ratio” means the ratio of Consolidated Indebtedness to
Consolidated Capitalization.

“Debt Rating” has the meaning specified in the definition of “Applicable Rate.”

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

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

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

“Defaulting Lender” means, subject to Section 2.18, any Lender that (a) has
failed to (i) fund any portion of the Committed Loans, participations in L/C
Obligations or participations in Swing Line Loans required to be funded by it
hereunder within two Business Days of the date required to be funded by it
hereunder unless such Lender notifies the Administrative Agent and Carpenter 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, the
L/C Issuer, the Swing Line 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 Swing Line Loans) within two Business Days of the date when due,
(b) has notified Carpenter, the Administrative Agent or the L/C Issuer or Swing
Line Lender in writing that it does not intend to comply with its obligations
under the Loan Documents, or has made a

 

10

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

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 Carpenter, to confirm in writing to the
Administrative Agent and Carpenter 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), 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, or (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; 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 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 2.18) upon delivery of
written notice of such determination to Carpenter, each Issuing Bank, each Swing
Line Lender and each Lender.

“Disposition” or “Dispose” means the sale, transfer, license or other
disposition (including any Sale/Leaseback Transaction) of any property by any
Person, including any sale, assignment, transfer or other disposal, with or
without recourse, of any notes, accounts receivable or payment intangible or any
rights or claims associated therewith.

“Disqualified Stock” of any Person means any Equity Interest of such Person
which by its terms (or by the terms of any security for which it is convertible
or for which it is exchangeable or exercisable), or upon the happening of any
event or otherwise (including an event which would constitute a Change of
Control), (a) matures or is mandatorily redeemable or subject to any mandatory
repurchase requirement, pursuant to a sinking fund or otherwise, (b) is
convertible into or exchangeable for Indebtedness or Disqualified Stock or
(c) is redeemable or subject to any repurchase requirement arising at the option
of the holder thereof, in whole or in part, on or prior to the first anniversary
of the Maturity Date.

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

“Dollar Equivalent” means, at any time, (a) with respect to any amount
denominated in Dollars, such amount, and (b) with respect to any amount
denominated in any Alternative Currency, the equivalent amount thereof in
Dollars as determined by the Administrative Agent or the L/C Issuer, as the case
may be, at such time on the basis of the Spot Rate (determined in respect of the
most recent Revaluation Date) for the purchase of Dollars with such Alternative
Currency.

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

“Eligible Assignee” means any Person that meets the requirements to be an
assignee under Section 11.06(b)(iii) and (v) (subject to such consents, if any,
as may be required under Section 11.06(b)(iii)).

 

11

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

“Eligible Investments” means, as of any date of determination, the cash, Cash
Equivalents and Marketable Securities which (a) are owned by Carpenter and held
in banks or other financial institutions located in the United States, (b) are
not subject to any Lien and (c) collectively, have an average credit quality
rated by S&P as A or better and an average maturity not greater than 365 days.

“EMU” means the economic and monetary union in accordance with the Treaty of
Rome 1957, as amended by the Single European Act 1986, the Maastricht Treaty of
1992 and the Amsterdam Treaty of 1998.

“EMU Legislation” means the legislative measures of the European Council for the
introduction of, changeover to or operation of a single or unified European
currency.

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

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

“Equity Equivalents” means with respect to any Person any rights, warrants,
options, convertible securities, exchangeable securities, indebtedness or other
rights, in each case exercisable for or convertible or exchangeable into,
directly or indirectly, Equity Interests of such Person or securities
exercisable for or convertible or exchangeable into Equity Interests of such
Person, whether at the time of issuance or upon the passage of time or the
occurrence of some future event.

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

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

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

“ERISA Event” means (a) a Reportable Event with respect to a Pension Plan; (b) a
withdrawal by Carpenter or any ERISA Affiliate from a Pension Plan subject to
Section 4063 of ERISA during a plan

 

12

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

year in which such entity was a “substantial employer” (as defined in
Section 4001(a)(2) of ERISA) or a cessation of operations that is treated as
such a withdrawal under Section 4062(e) of ERISA; (c) a complete or partial
withdrawal by Carpenter or any ERISA Affiliate from a Multiemployer Plan or the
receipt of notification that a Multiemployer Plan is in reorganization; (d) the
filing of a notice of intent to terminate a Pension Plan, or the treatment of a
Pension Plan amendment as a termination, under Section 4041 or 4041A of ERISA;
(e) the commencement of proceedings by the PBGC to terminate a Pension Plan;
(f) an event or condition which constitutes grounds under Section 4042 of ERISA
for the termination of, or the appointment of a trustee to administer, any
Pension Plan; (g) with respect to any Pension Plan that is not a Multiemployer
Plan, a reduction in the adjusted funding target attainment percentage (within
the meaning of Section 436(j)(2) of the Code), as certified by the Plan’s
actuary with respect to a plan year, or as deemed by operation of Section 436 of
the Code in the absence of such certification, below 60%; (h) the receipt by
Carpenter or an ERISA Affiliate of any notice that a Multiemployer Plan is in
endangered or critical status; or (i) the imposition of any liability under
Title IV of ERISA, other than for PBGC premiums due but not delinquent under
Section 4007 of ERISA, upon Carpenter or any ERISA Affiliate.

“Euro” and “EUR” mean the lawful currency of the Participating Member States
introduced in accordance with the EMU Legislation.

“Eurocurrency Base Rate” means:

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

(b) for any interest rate calculation with respect to a Base Rate Loan on any
date, the rate per annum equal to (i) BBA LIBOR, at approximately 11:00 a.m.,
London time determined two London Banking Days prior to the date for Dollar
deposits being delivered in the London interbank market for a term of one month
commencing that day or (ii) if such published rate is not available at such time
for any reason, the rate determined by the Administrative Agent to be the rate
at which deposits in Dollars for delivery on the date of determination in same
day funds in the approximate amount of the Base Rate Loan being made or
maintained by Bank of America and with a term equal to one month would be
offered by Bank of America’s London Branch to major banks in the London
interbank eurodollar market at their request at the date and time of
determination.

“Eurocurrency Bid Margin” means the margin above or below the Eurocurrency Base
Rate to be added to or subtracted from the Eurocurrency Base Rate, which margin
shall be expressed in multiples of 1/100th of one basis point.

“Eurocurrency Margin Bid Loan” means a Bid Loan that bears interest at a rate
based upon the Eurocurrency Base Rate.

 

13

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

“Eurocurrency Rate” means for any Interest Period with respect to a Eurocurrency
Rate Loan, a rate per annum determined by the Administrative Agent pursuant to
the following formula:

 

Eurocurrency Rate =   

Eurocurrency Base Rate

   1.00 - Eurocurrency Reserve Percentage

“Eurocurrency Rate Loan” means a Committed Loan or a Eurocurrency Margin Bid
Loan that bears interest at a rate based on the Eurocurrency Rate. Eurocurrency
Rate Loans may be denominated in Dollars or in an Alternative Currency. All
Committed Loans denominated in an Alternative Currency must be Eurocurrency Rate
Loans.

“Eurocurrency Reserve Percentage” means, for any day during any Interest Period,
the reserve percentage (expressed as a decimal, carried out to five decimal
places) in effect on such day, whether or not applicable to any Lender, under
regulations issued from time to time by the FRB for determining the maximum
reserve requirement (including any emergency, supplemental or other marginal
reserve requirement) with respect to Eurocurrency funding (currently referred to
as “Eurocurrency liabilities”). The Eurocurrency Rate for each outstanding
Eurocurrency Rate Loan shall be adjusted automatically as of the effective date
of any change in the Eurocurrency Reserve Percentage.

“Eurocurrency Unavailability Period” means any period of time during which a
notice delivered to Carpenter in accordance with Section 3.03 shall remain in
effect.

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

“Exchange Act” means the Securities Exchange Act of 1934, as amended, and any
successor statute thereto, together with the rules and regulations promulgated
thereunder.

“Excluded Taxes” means, with respect to the Administrative Agent, any Lender,
the L/C Issuer or any other recipient of any payment to be made by or on account
of any obligation of any Borrower hereunder, (a) taxes imposed on or measured by
its overall net income (however denominated), and overall gross income and
franchise taxes imposed on it (in lieu of net income taxes), as a result of
present or former connection between such recipient and the jurisdiction of the
Governmental Authority imposing such tax or political subdivision or any taxing
authority thereof or therein (other than such connection arising solely from any
recipient having executed, delivered or performed its obligations or received a
payment under, or enforced and/or engaged in any other activities contemplated
with respect to, any Loan Document) by the jurisdiction (or any political
subdivision thereof) under the Laws of which such recipient is organized or in
which its principal office is located or, in the case of any Lender, in which
its applicable Lending Office is located, (b) any branch profits taxes imposed
by the United States or any similar tax imposed by any other jurisdiction in
which such Borrower is located, (c) any backup withholding tax that is required
by the Code to be withheld from amounts payable to a Lender that has failed to
comply with clause (A) of Section 3.01(e)(ii), (d) in the case of a Foreign
Lender (other than an assignee pursuant to a request by Carpenter under
Section 11.13), any United States withholding tax that (i) is required to be
imposed on amounts payable to such Foreign Lender pursuant to the Laws in force
at the time such Foreign Lender becomes a party hereto (or designates a new
Lending Office) or (ii) is attributable to such Foreign Lender’s failure or
inability (other than as a result of a Change in Law) to comply with clause
(B) of Section 3.01(e)(ii), except to the extent that such Foreign Lender (or
its assignor, if any) was entitled, at the time of designation of a new Lending
Office (or assignment), to receive additional amounts from such Borrower with
respect to such withholding tax pursuant to Section 3.01(a)(ii) or (iii) and
(e) any Taxes imposed under FATCA or any amended or successor version of FATCA
that is substantively comparable and not materially more onerous to comply with.
Notwithstanding anything to the contrary contained in this definition, “Excluded
Taxes” shall not include

 

14

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

any withholding tax imposed at any time on payments made by or on behalf of a
Foreign Obligor to any Lender hereunder or under any other Loan Document,
provided that such Lender shall have complied with Section 3.01(e)(i).

“Existing Credit Agreement” means that certain Credit Agreement dated as of
November 24, 2009 among Carpenter, the Subsidiary Borrowers, the banks and other
financial institutions from time to time party thereto as lenders and Bank of
America, as administrative agent.

“Existing Letters of Credit” means the letters of credit described by the date
of issuance, letter of credit number, undrawn amount, currency, name of
beneficiary and date of expiry on Schedule 1.01-A.

“FATCA” means Sections 1471 through 1474 of the Code, as of the date of this
Agreement, and any current or future regulations or official interpretations
thereof.

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

“Fee Letters” means, collectively, the Joint Fee Letter and the Administrative
Agent’s Fee Letter.

“Foreign Benefit Plan” means any employee benefit plan, pension plan or welfare
plan not subject to ERISA which is maintained or contributed to for the benefit
of the employees of a Foreign Obligor or its Subsidiaries which, under
applicable law, (a) is required to be funded through a trust or similar funding
vehicle or (b) creates or could result in a Lien on any property of such Foreign
Obligor or any of its Subsidiaries.

“Foreign Lender” means, with respect to any Borrower, any Lender that is
organized under the Laws of a jurisdiction other than that in which such
Borrower is resident for tax purposes (including such a Lender when acting in
the capacity of the L/C Issuer). For purposes of this definition, the United
States, each State thereof and the District of Columbia shall be deemed to
constitute a single jurisdiction.

“Foreign Obligor” means any Borrower that is incorporated or organized under the
laws of a jurisdiction other than the United States, a State thereof or the
District of Columbia.

“Foreign Subsidiary” means any Subsidiary that is organized under the laws of a
jurisdiction other than the United States, a State thereof or the District of
Columbia.

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

“Fronting Exposure” means, at any time there is a Defaulting Lender, (a) with
respect to the L/C Issuer, such Defaulting Lender’s Applicable Percentage of the
outstanding L/C Obligations other than L/C Obligations as to which such
Defaulting Lender’s participation obligation has been reallocated to other
Lenders or Cash Collateralized in accordance with the terms hereof, and (b) with
respect to the Swing Line Lender, such Defaulting Lender’s Applicable Percentage
of Swing Line Loans other than Swing Line Loans as to which such Defaulting
Lender’s participation obligation has been reallocated to other Lenders or Cash
Collateralized in accordance with the terms hereof.

 

15

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

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

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

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

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

“Guaranteed Obligations” has the meaning specified in Section 10.01.

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

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

 

16

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

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

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

“Indebtedness” of any Person means at any date, without duplication, (a) all
obligations of such Person for borrowed money, including, without limitation,
obligations for borrowed money incurred by any Person in respect of any asset
securitization transaction, (b) all obligations of such Person evidenced by
bonds, debentures, notes or other similar instruments, (c) all obligations of
such Person under conditional sale or other title retention agreements relating
to property purchased by such Person to the extent of the value of such property
(other than customary reservations or retentions of title under agreements with
suppliers entered into in the ordinary course of business), (d) all obligations,
other than intercompany items, of such Person to pay the deferred purchase price
of property or services (other than trade accounts payable arising in the
ordinary course of business and not past due for more than 60 days after the
date on which such trade account was created), (e) the Attributable Indebtedness
of such Person in respect of Capital Lease Obligations and Synthetic Lease
Obligations (regardless of whether accounted for as indebtedness under GAAP),
(f) all obligations of such Person to purchase securities or other property
which arise out of or in connection with the sale of the same or substantially
similar securities or property, (g) all non–contingent obligations (and, for
purposes of Section 7.01 and Section 8.01(f), all contingent obligations) of
such Person to reimburse any bank or other Person in respect of amounts paid
under a letter of credit, bankers’ acceptance or similar instrument, (h) all
Guarantees of such Person, (i) all Disqualified Stock of such Person, (j) the
net termination obligations of such Person in respect of any interest rate
Hedging Contract, calculated as of any date as if such agreement or arrangement
were terminated as of such date and (k) the Indebtedness of any other Person
(including any partnership in which such Person is a general partner and any
unincorporated joint venture in which such Person is a joint venturer) to the
extent such Person would be liable therefor under applicable law or any
agreement or instrument by virtue of such Person’s ownership interest in or
other relationship with such entity, except to the extent the terms of such
Indebtedness provide that such person shall not be liable therefor.

“Indemnified Taxes” means Taxes other than Excluded Taxes.

“Indemnitees” has the meaning specified in Section 11.04(b).

“Information” has the meaning specified in Section 11.07.

“Interest Coverage Ratio” means for any period the ratio of (a) Consolidated
EBITDA to (b) Consolidated Interest Expense for such period.

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

 

17

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

“Interest Period” means (a) as to each Eurocurrency Rate Loan, the period
commencing on the date such Eurocurrency Rate Loan is disbursed or converted to
or continued as a Eurocurrency Rate Loan and ending on the date one, two, three
or six months thereafter, as selected by Carpenter in its Committed Loan Notice
or Bid Request, as the case may be and (b) as to each Absolute Rate Loan, a
period of not less than 14 days and not more than 180 days as selected by
Carpenter in its Bid Request; provided that:

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

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

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

“Investment” in any Person means (a) the acquisition (whether for cash,
property, services, assumption of Indebtedness, securities or otherwise) of
assets, shares of Equity Interests, bonds, notes, debentures, time deposits or
other securities of such other Person, (b) any deposit with, or advance, loan or
other extension of credit to or for the benefit of such Person (other than
deposits made in connection with the purchase of equipment or inventory in the
ordinary course of business) or (c) any other capital contribution to or
investment in such Person, including by way of Guarantees of any obligation of
such Person, any support for a letter of credit issued on behalf of such Person
incurred for the benefit of such Person or in the case of any Subsidiary of
Carpenter, any release, cancellation, compromise or forgiveness in whole or in
part of any Indebtedness owing by such Subsidiary.

“IRS” means the United States Internal Revenue Service.

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

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

“Joint Fee Letter” means that certain letter agreement, dated as of May 9, 2011,
among Bank of America, JPMorgan Chase Bank, N.A., the Arrangers and Carpenter.

“Krona” and “kr” mean the lawful currency of Sweden.

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

 

18

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

“L/C Advance” means, with respect to each Lender, such Lender’s funding of its
participation in any L/C Borrowing in accordance with its Applicable Percentage.
All L/C Advances shall be denominated in Dollars or in an Alternative Currency.

“L/C Borrowing” means an extension of credit resulting from a drawing under any
Letter of Credit which has not been reimbursed on the date when made or
refinanced as a Committed Borrowing. All L/C Borrowings shall be denominated in
Dollars or in an Alternative Currency.

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

“L/C Issuer” means Bank of America in its capacity as issuer of Letters of
Credit hereunder, or any successor issuer of Letters of Credit hereunder.

“L/C Obligations” means, as at any date of determination, the aggregate amount
available to be drawn under all outstanding Letters of Credit plus the aggregate
of all Unreimbursed Amounts, including all L/C Borrowings. For purposes of
computing the amount available to be drawn under any Letter of Credit, the
amount of such Letter of Credit shall be determined in accordance with
Section 1.09. For all purposes of this Agreement, if on any date of
determination a Letter of Credit has expired by its terms but any amount may
still be drawn thereunder by reason of the operation of Rule 3.14 of the ISP,
such Letter of Credit shall be deemed to be “outstanding” in the amount so
remaining available to be drawn.

“Lender” has the meaning specified in the introductory paragraph hereto and, as
the context requires, includes the Swing Line Lender.

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

“Letter of Credit” means any letter of credit issued hereunder and shall include
the Existing Letters of Credit. A Letter of Credit may be a commercial letter of
credit or a standby letter of credit. Letters of Credit may be issued in Dollars
or in an Alternative Currency.

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

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

“Letter of Credit Fee” has the meaning specified in Section 2.04(h).

“Letter of Credit Sublimit” means an amount equal to the lesser of
(a) $100,000,000 and (b) the Aggregate Commitments. The Letter of Credit
Sublimit is part of, and not in addition to, the Aggregate Commitments.

“Lien” means, with respect to any asset, any mortgage, pledge, hypothecation,
assignment, deposit arrangement, encumbrance, lien (statutory or other), charge,
or preference, priority or other security interest or preferential arrangement
of any kind or nature whatsoever (including any conditional sale or other title
retention agreement, any financing lease having substantially the same economic
effect as any of the foregoing, and the filing of any financing statement under
the Uniform Commercial Code or comparable Laws of any jurisdiction), including
the interest of a purchaser of accounts receivable, chattel paper, payment
intangibles or promissory notes.

 

19

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

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

“Loan Documents” means this Agreement, each Subsidiary Borrower Request and
Assumption Agreement, each Note, each Issuer Document, each Fee Letter and an
agreement creating or perfecting rights in Cash Collateral pursuant to the
provisions of Section 2.17.

“London Banking Day” means any day on which dealings in Dollar deposits are
conducted by and between banks in the London interbank eurodollar market.

“Mandatory Cost” means, with respect to any period, the percentage rate per
annum determined in accordance with Schedule 1.01-B.

“Marketable Securities” means the U.S. Government and Government-guaranteed
agency securities, U.S. Government-sponsored agency obligations, corporate debt
and other obligations permitted for investment by Carpenter and all of its
Wholly-Owned Subsidiaries in the “Policy Guidelines for Short-Term Excess Cash
Investments,” dated as of October 23, 2009, furnished by Carpenter to the
Administrative Agent, as modified and amended from time to time and reasonably
satisfactory to the Administrative Agent.

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

“Maturity Date” means June 21, 2016; provided, however, that if such date is not
a Business Day, the Maturity Date shall be the next preceding Business Day.

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

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

“Multiple Employer Plan” means a Plan which has two or more contributing
sponsors (including any Borrower or any ERISA Affiliate) at least two of whom
are not under common control, as such a plan is described in Section 4064 of
ERISA.

“Non-Consenting Lender” has the meaning specified in Section 11.13.

“Non-Defaulting Lender” means, at any time, each Lender that is not a Defaulting
Lender at such time.

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

 

20

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

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

“OFAC” means the U.S. Department of the Treasury’s Office of Foreign Assets
Control, and any successor thereto.

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

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

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

“Overnight Rate” means, for any day, (a) with respect to any amount denominated
in Dollars, the greater of (i) the Federal Funds Rate and (ii) an overnight rate
determined by the Administrative Agent, the L/C Issuer, or the Swing Line
Lender, as the case may be, in accordance with banking industry rules on
interbank compensation, and (b) with respect to any amount denominated in an
Alternative Currency, the rate of interest per annum at which overnight deposits
in the applicable Alternative Currency, in an amount approximately equal to the
amount with respect to which such rate is being determined, would be offered for
such day by a branch or Affiliate of Bank of America in the applicable offshore
interbank market for such currency to major banks in such interbank market.

“Participant” has the meaning specified in Section 11.06(d).

“Participant Register” has the meaning specified in Section 11.06(d).

“Participating Member State” means each state so described in any EMU
Legislation.

 

21

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

“Patriot Act” has the meaning specified in Section 11.18.

“PBGC” means the Pension Benefit Guaranty Corporation.

“Pension Act” means the Pension Protection Act of 2006.

“Pension Funding Rules” means the rules of the Code and ERISA regarding minimum
required contributions (including any installment payment thereof) to Pension
Plans and set forth in, with respect to plan years ending prior to the effective
date of the Pension Act, Section 412 of the Code and Section 302 of ERISA, each
as in effect prior to the Pension Act and, thereafter, Section 412, 430, 431,
432 and 436 of the Code and Sections 302, 303, 304 and 305 of ERISA.

“Pension Plan” means any employee pension benefit plan (including a Multiple
Employer Plan or a Multiemployer Plan) that is maintained or is contributed to
by Carpenter or any ERISA Affiliate and is either covered by Title IV of ERISA
or is subject to the minimum funding standards under Section 412 of the Code.

“Permitted Lien” has the meaning set forth in Section 7.02.

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

“Plan” means any employee benefit plan within the meaning of Section 3(3) of
ERISA (including a Pension Plan), maintained for employees of Carpenter or any
ERISA Affiliate or any such Plan to which Carpenter or any ERISA Affiliate is
required to contribute on behalf of any of its employees.

“Platform” has the meaning specified in Section 6.01(i).

“Public Lender” has the meaning specified in Section 6.01(i).

“Purchase Money Indebtedness” means Indebtedness of Carpenter or any Subsidiary
incurred for the purpose of financing all or any part of the purchase price or
cost of construction or improvement of property used in the business of
Carpenter or such Subsidiary.

“Register” has the meaning specified in Section 11.06(c).

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

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

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

“Required Lenders” means, as of any date of determination, Lenders having more
than 50% of the Aggregate Commitments or, if the commitment of each Lender to
make Loans and the obligation of the L/C Issuer to make L/C Credit Extensions
have been terminated pursuant to Section 8.02, Lenders

 

22

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

holding in the aggregate more than 50% of the Total Outstandings (with the
aggregate amount of each Lender’s risk participation and funded participation in
L/C Obligations and Swing Line Loans being deemed “held” by such Lender for
purposes of this definition); provided that the Commitment of, and the portion
of the Total Outstandings held or deemed held by, any Defaulting Lender shall be
excluded for purposes of making a determination of Required Lenders.

“Responsible Officer” means the chief executive officer, president, chief
financial officer, treasurer, assistant treasurer or controller of a Borrower.
Any document delivered hereunder that is signed by a Responsible Officer of a
Borrower shall be conclusively presumed to have been authorized by all necessary
corporate, partnership and/or other action on the part of such Borrower and such
Responsible Officer shall be conclusively presumed to have acted on behalf of
such Borrower.

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

“Revaluation Date” means (a) with respect to any Loan, each of the following:
(i) each date of a Borrowing of a Eurocurrency Rate Loan denominated in an
Alternative Currency, (ii) each date of a continuation of a Eurocurrency Rate
Loan denominated in an Alternative Currency pursuant to Section 2.02, and
(iii) such additional dates as the Administrative Agent shall determine or the
Required Lenders shall require; and (b) with respect to any Letter of Credit,
each of the following: (i) each date of issuance of a Letter of Credit
denominated in an Alternative Currency, (ii) each date of an amendment of any
such Letter of Credit having the effect of increasing the amount thereof (solely
with respect to the increased amount), (iii) each date of any payment by the L/C
Issuer under any Letter of Credit denominated in an Alternative Currency and
(iv) such additional dates as the Administrative Agent or the L/C Issuer shall
determine or the Required Lenders shall require.

“Sale/Leaseback Transaction” means any direct or indirect arrangement with any
Person or to which any such Person is a party providing for the leasing to
Carpenter or any of its Subsidiaries of any property, whether owned by Carpenter
or any of its Subsidiaries as of the Closing Date or later acquired, which has
been or is to be sold or transferred by Carpenter or any of its Subsidiaries to
such Person or to any other Person from whom funds have been, or are to be,
advanced by such Person on the security of such property

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

“Same Day Funds” means (a) with respect to disbursements and payments in
Dollars, immediately available funds, and (b) with respect to disbursements and
payments in an Alternative Currency, same day or other funds as may be
determined by the Administrative Agent or the L/C Issuer, as the case may be, to
be customary in the place of disbursement or payment for the settlement of
international banking transactions in the relevant Alternative Currency.

“Sanctioned Country” shall mean a country subject to a sanctions program
identified on the list maintained by OFAC and available at
http://www.treas.gov/offices/eotffc/ofac/sanctions/index/html, or as otherwise
published from time to time.

 

23

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

“Sanctioned Person” means (a) a Person named on the list of Specially Designated
Nationals or Blocked Persons maintained by OFAC available at
http://www.treas.gov/offices/eotffc/ofac/sdn/index/html, or as otherwise
published from time to time, or (b) (i) an agency of the government of a
Sanctioned Country, (ii) an organization controlled by a Sanctioned Country, or
(iii) a Person resident in a Sanctioned Country, to the extent subject to a
sanctions program administered by OFAC.

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

“Securities Act” means the Securities Act of 1933, as amended, and any successor
statute thereto, together with the rules and regulations promulgated thereunder.

“Special Notice Currency” means at any time an Alternative Currency, other than
the currency of a country that is a member of the Organization for Economic
Cooperation and Development at such time located in North America or Europe.

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

“Specified Hedge Agreement” means any Hedging Contract permitted under this
Agreement that is entered into by and between any Borrower and any Hedging Bank.

“Specified Obligations” means all existing or future payment and other
obligations owing by any Subsidiary Borrower under any Specified Cash Management
Agreement or Specified Hedge Agreement.

“Spot Rate” for a currency means the rate determined by the Administrative Agent
or the L/C Issuer, as applicable, to be the rate quoted by the Person acting in
such capacity as the spot rate for the purchase by such Person of such currency
with another currency through its principal foreign exchange trading office at
approximately 11:00 a.m. on the date two Business Days prior to the date as of
which the foreign exchange computation is made; provided that the Administrative
Agent or the L/C Issuer may obtain such spot rate from another financial
institution designated by the Administrative Agent or the L/C Issuer if the
Person acting in such capacity does not have as of the date of determination a
spot buying rate for any such currency; and provided further that the L/C Issuer
may use such spot rate quoted on the date as of which the foreign exchange
computation is made in the case of any Letter of Credit denominated in an
Alternative Currency.

“Sterling” and “£” mean the lawful currency of the United Kingdom.

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

“Subsidiary Borrower” has the meaning specified in Section 2.15.

“Subsidiary Borrower Notice” has the meaning specified in Section 2.15.

 

24

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

“Subsidiary Borrower Request and Assumption Agreement” has the meaning specified
in Section 2.15.

“Swing Line Borrowing” means a borrowing of a Swing Line Loan pursuant to
Section 2.05.

“Swing Line Lender” means Bank of America in its capacity as provider of Swing
Line Loans, or any successor swing line lender hereunder.

“Swing Line Loan” has the meaning specified in Section 2.05(a).

“Swing Line Loan Notice” means a notice of a Swing Line Borrowing pursuant to
Section 2.05(b), which, if in writing, shall be substantially in the form of
Exhibit C.

“Swing Line Sublimit” means an amount equal to the lesser of (a) $30,000,000 and
(b) the Aggregate Commitments. The Swing Line Sublimit is part of, and not in
addition to, the Aggregate Commitments.

“Synthetic Lease Obligation” means the monetary obligation of a Person under
(a) a so-called synthetic, off-balance sheet or tax retention lease, or (b) an
agreement for the use or possession of property creating obligations that do not
appear on the balance sheet of such Person but which, upon the insolvency or
bankruptcy of such Person, would be characterized as the indebtedness of such
Person (without regard to accounting treatment).

“TARGET Day” means any day on which the Trans-European Automated Real-time Gross
Settlement Express Transfer (TARGET) payment system (or, if such payment system
ceases to be operative, such other payment system (if any) determined by the
Administrative Agent to be a suitable replacement) is open for the settlement of
payments in Euro.

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

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

“Type” means (a) with respect to a Committed Loan, its character as a Base Rate
Loan or a Eurocurrency Rate Loan, and (b) with respect to a Bid Loan, its
character as an Absolute Rate Loan or a Eurocurrency Margin Bid Loan.

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

“Unreimbursed Amount” has the meaning specified in Section 2.04(c)(i).

“Wholly–Owned Subsidiary” means, with respect to any Person at any date, any
Subsidiary of such Person all of the shares of capital stock or other ownership
interests of which (except directors’ qualifying shares) are at the time
directly or indirectly owned by such Person.

 

25

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

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

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

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

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

1.03 Accounting Terms. (a) Generally. All accounting terms not specifically or
completely defined herein shall be construed in conformity with, and all
financial data (including financial ratios and other financial calculations)
required to be submitted pursuant to this Agreement shall be prepared in
conformity with, GAAP applied on a consistent basis, as in effect from time to
time, applied in a manner consistent with that used in preparing Carpenter’s
2010 Form 10-K, except as otherwise specifically prescribed herein.

(b) Changes in GAAP. If at any time any change in GAAP would affect the
computation of any financial ratio or requirement set forth in any Loan Document
(including, without limitation, compliance with any basket or carve-out set
forth in any of the Loan Documents), and either Carpenter or the Required
Lenders shall so request, the Administrative Agent, the Lenders and Carpenter
shall negotiate in good faith to amend such ratio or requirement to preserve the
original intent thereof in light of such change in GAAP (subject to the approval
of the Required Lenders); provided that, until so amended, (i) such ratio or
requirement shall continue to be computed in accordance with GAAP prior to such
change therein and (ii) Carpenter shall provide to the Administrative Agent and
the Lenders financial statements and other documents required under this
Agreement or as reasonably requested hereunder setting forth a reconciliation
between calculations of such ratio or requirement made before and after giving
effect to such change in GAAP.

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

 

26

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

1.05 Exchange Rates; Currency Equivalents. (a) The Administrative Agent or the
L/C Issuer, as applicable, shall determine the Spot Rates as of each Revaluation
Date to be used for calculating Dollar Equivalent amounts of Credit Extensions
and Outstanding Amounts denominated in Alternative Currencies. Such Spot Rates
shall become effective as of such Revaluation Date and shall be the Spot Rates
employed in converting any amounts between the applicable currencies until the
next Revaluation Date to occur. Except for purposes of financial statements
delivered by Carpenter hereunder or calculating financial covenants hereunder or
except as otherwise provided herein, the applicable amount of any currency
(other than Dollars) for purposes of the Loan Documents shall be such Dollar
Equivalent amount as so determined by the Administrative Agent or the L/C
Issuer, as applicable.

(b) Wherever in this Agreement in connection with a Borrowing, conversion,
continuation or prepayment of a Eurocurrency Rate Loan or the issuance,
amendment or extension of a Letter of Credit, an amount, such as a required
minimum or multiple amount, is expressed in Dollars, but such Borrowing,
Eurocurrency Rate Loan or Letter of Credit is denominated in an Alternative
Currency, such amount shall be the relevant Alternative Currency Equivalent of
such Dollar amount (rounded to the nearest unit of such Alternative Currency,
with 0.5 of a unit being rounded upward), as determined by the Administrative
Agent or the L/C Issuer, as the case may be.

1.06 Additional Alternative Currencies. (a) Carpenter may from time to time
request that Eurocurrency Rate Loans be made and/or Letters of Credit be issued
in a currency other than those specifically listed in the definition of
“Alternative Currency;” provided that such requested currency is a lawful
currency (other than Dollars) that is readily available and freely transferable
and convertible into Dollars. In the case of any such request with respect to
the making of Eurocurrency Rate Loans, such request shall be subject to the
approval of the Administrative Agent and the Lenders; and in the case of any
such request with respect to the issuance of Letters of Credit, such request
shall be subject to the approval of the Administrative Agent and the L/C Issuer.

(b) Any such request shall be made to the Administrative Agent not later than
11:00 a.m., 20 Business Days prior to the date of the desired Credit Extension
(or such other time or date as may be agreed by the Administrative Agent and, in
the case of any such request pertaining to Letters of Credit, the L/C Issuer, in
its or their sole discretion). In the case of any such request pertaining to
Eurocurrency Rate Loans, the Administrative Agent shall promptly notify each
Lender thereof; and in the case of any such request pertaining to Letters of
Credit, the Administrative Agent shall promptly notify the L/C Issuer thereof.
Each Lender (in the case of any such request pertaining to Eurocurrency Rate
Loans) or the L/C Issuer (in the case of a request pertaining to Letters of
Credit) shall notify the Administrative Agent, not later than 11:00 a.m., ten
Business Days after receipt of such request whether it consents, in its sole
discretion, to the making of Eurocurrency Rate Loans or the issuance of Letters
of Credit, as the case may be, in such requested currency.

(c) Any failure by a Lender or the L/C Issuer, as the case may be, to respond to
such request within the time period specified in the preceding sentence shall be
deemed to be a refusal by such Lender or the L/C Issuer, as the case may be, to
permit Eurocurrency Rate Loans to be made or Letters of Credit to be issued in
such requested currency. If the Administrative Agent and all the Lenders consent
to making Eurocurrency Rate Loans in such requested currency, the Administrative
Agent shall so notify Carpenter and such currency shall thereupon be deemed for
all purposes to be an Alternative Currency hereunder for purposes of any
Borrowings of Eurocurrency Rate Loans; and if the Administrative Agent and the
L/C Issuer consent to the issuance of Letters of Credit in such requested
currency, the Administrative Agent shall so notify Carpenter and such currency
shall thereupon be deemed for all purposes to be an Alternative Currency
hereunder for purposes of any Letter of Credit issuances. If the Administrative
Agent shall fail to obtain consent to any request for an additional currency
under this Section 1.06, the Administrative Agent shall promptly so notify
Carpenter.

 

27

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

1.07 Change of Currency. (a) Each obligation of the Borrowers to make a payment
denominated in the national currency unit of any member state of the European
Union that adopts the Euro as its lawful currency after the date hereof shall be
redenominated into Euro at the time of such adoption (in accordance with the EMU
Legislation). If, in relation to the currency of any such member state, the
basis of accrual of interest expressed in this Agreement in respect of that
currency shall be inconsistent with any convention or practice in the London
interbank market for the basis of accrual of interest in respect of the Euro,
such expressed basis shall be replaced by such convention or practice with
effect from the date on which such member state adopts the Euro as its lawful
currency; provided that if any Borrowing in the currency of such member state is
outstanding immediately prior to such date, such replacement shall take effect,
with respect to such Borrowing, at the end of the then current Interest Period.

(b) Each provision of this Agreement shall be subject to such reasonable changes
of construction as the Administrative Agent may from time to time specify to be
appropriate to reflect the adoption of the Euro by any member state of the
European Union and any relevant market conventions or practices relating to the
Euro.

(c) Each provision of this Agreement also shall be subject to such reasonable
changes of construction as the Administrative Agent may from time to time
specify to be appropriate to reflect a change in currency of any other country
and any relevant market conventions or practices relating to the change in
currency.

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

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

ARTICLE II

THE COMMITMENTS AND CREDIT EXTENSIONS

2.01 Committed Loans. Subject to the terms and conditions set forth herein, each
Lender severally agrees to make loans (each such loan, a “Committed Loan”) to
the Borrowers in Dollars or in one or more Alternative Currencies from time to
time, on any Business Day during the Availability Period, in an aggregate amount
not to exceed at any time outstanding the amount of such Lender’s Commitment;
provided, however, that after giving effect to any Committed Borrowing, (a) the
Total Outstandings shall not exceed the Aggregate Commitments, and (b) the
aggregate Outstanding Amount of the Committed Loans of any Lender, plus such
Lender’s Applicable Percentage of the Outstanding Amount of all L/C Obligations,
plus such Lender’s Applicable Percentage of the Outstanding Amount of all Swing
Line Loans shall not exceed such Lender’s Commitment. Within the limits of each
Lender’s Commitment, and subject to the other terms and conditions hereof, the
Borrowers may borrow under this Section 2.01, prepay under Section 2.06, and
reborrow under this Section 2.01. Committed Loans may be Base Rate Loans or
Eurocurrency Rate Loans, as further provided herein.

 

28

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

2.02 Borrowings, Conversions and Continuations of Committed Loans.

(a) Each Committed Borrowing, each conversion of Committed Loans from one Type
to the other, and each continuation of Eurocurrency Rate Loans shall be made
upon Carpenter’s irrevocable notice to the Administrative Agent, which may be
given by telephone. Each such notice must be received by the Administrative
Agent not later than 11:00 a.m. (i) three Business Days prior to the requested
date of any Borrowing of, conversion to or continuation of Eurocurrency Rate
Loans denominated in Dollars or of any conversion of Eurocurrency Rate Loans
denominated in Dollars to Base Rate Committed Loans, (ii) four Business Days (or
five Business Days in the case of a Special Notice Currency) prior to the
requested date of any Borrowing or continuation of Eurocurrency Rate Loans
denominated in Alternative Currencies, and (iii) on the requested date of any
Borrowing of Base Rate Committed Loans. Each telephonic notice by Carpenter
pursuant to this Section 2.02(a) must be confirmed promptly by delivery to the
Administrative Agent of a written Committed Loan Notice, appropriately completed
and signed by a Responsible Officer of Carpenter. Each Borrowing of, conversion
to or continuation of Eurocurrency Rate Loans shall be in a principal amount of
$2,000,000 or a whole multiple of $1,000,000 in excess thereof. Except as
provided in Sections 2.04(c) and 2.05(c), each Committed Borrowing of or
conversion to Base Rate Committed Loans shall be in a principal amount of
$1,000,000 or a whole multiple of $100,000 in excess thereof. Each Committed
Loan Notice (whether telephonic or written) shall specify (i) whether Carpenter
is requesting a Committed Borrowing, a conversion of Committed Loans from one
Type to the other, or a continuation of Eurocurrency Rate Loans, (ii) the
requested date of the Borrowing, conversion or continuation, as the case may be
(which shall be a Business Day), (iii) the principal amount of Committed Loans
to be borrowed, converted or continued, (iv) the Type of Committed Loans to be
borrowed or to which existing Committed Loans are to be converted, (v) if
applicable, the duration of the Interest Period with respect thereto, (vi) the
currency of the Committed Loans to be borrowed, and (vii) if applicable, the
Subsidiary Borrower. If Carpenter fails to specify a currency in a Committed
Loan Notice requesting a Borrowing, then the Committed Loans so requested shall
be made in Dollars. If Carpenter fails to specify a Type of Committed Loan in a
Committed Loan Notice or if Carpenter fails to give a timely notice requesting a
conversion or continuation, then the applicable Committed Loans shall be made
as, or converted to, Base Rate Loans; provided, however, that in the case of a
failure to timely request a continuation of Committed Loans denominated in an
Alternative Currency, such Loans shall be continued as Eurocurrency Rate Loans
in their original currency with an Interest Period of one month. Any automatic
conversion to Base Rate Loans shall be effective as of the last day of the
Interest Period then in effect with respect to the applicable Eurocurrency Rate
Loans. If Carpenter requests a Borrowing of, conversion to, or continuation of
Eurocurrency Rate Loans in any such Committed Loan Notice, but fails to specify
an Interest Period, it will be deemed to have specified an Interest Period of
one month. No Committed Loan may be converted into or continued as a Committed
Loan denominated in a different currency, but instead must be prepaid in the
original currency of such Committed Loan and reborrowed in the other currency.

(b) Following receipt of a Committed Loan Notice, the Administrative Agent shall
promptly notify each Lender of the amount (and currency) of its Applicable
Percentage of the applicable Committed Loans, and if no timely notice of a
conversion or continuation is provided by Carpenter, the Administrative Agent
shall notify each Lender of the details of any automatic conversion to Base Rate
Loans or continuation of Committed Loans denominated in a currency other than
Dollars, in each case as described in the preceding subsection. In the case of a
Committed Borrowing, each Lender shall make the amount of its Committed Loan
available to the Administrative Agent in Same Day Funds at the Administrative
Agent’s Office for the applicable currency not later than 1:00 p.m., in the case
of any Committed Loan denominated in Dollars, and not later than the Applicable
Time specified by the Administrative Agent in the case of any Committed Loan in
an Alternative Currency, in each case on the Business Day specified in the
applicable Committed Loan Notice. Upon satisfaction of the applicable conditions
set forth in Section 4.02 (and, if such Borrowing is the initial Credit
Extension, Section 4.01), the Administrative Agent shall make all funds so
received available to Carpenter or the other applicable Borrower in like funds
as received by the Administrative Agent either by (i) crediting the account of
such

 

29

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

Borrower on the books of Bank of America with the amount of such funds or
(ii) wire transfer of such funds, in each case in accordance with instructions
provided to (and reasonably acceptable to) the Administrative Agent by
Carpenter; provided, however, that if, on the date the Committed Loan Notice
with respect to such Borrowing denominated in Dollars is given by Carpenter,
there are L/C Borrowings outstanding, then the proceeds of such Borrowing,
first, shall be applied to the payment in full of any such L/C Borrowings, and,
second, shall be made available to the applicable Borrower as provided above.

(c) Except as otherwise provided herein, a Eurocurrency Rate Loan may be
continued or converted only on the last day of an Interest Period for such
Eurocurrency Rate Loan. During the existence of a Default, no Loans may be
requested as, converted to or continued as Eurocurrency Rate Loans (whether in
Dollars or any Alternative Currency) without the consent of the Required
Lenders, and the Required Lenders may demand that any or all of the then
outstanding Eurocurrency Rate Loans denominated in an Alternative Currency be
prepaid, or redenominated into Dollars in the amount of the Dollar Equivalent
thereof, on the last day of the then current Interest Period with respect
thereto.

(d) The Administrative Agent shall promptly notify Carpenter and the Lenders of
the interest rate applicable to any Interest Period for Eurocurrency Rate Loans
upon determination of such interest rate. At any time that Base Rate Loans are
outstanding, the Administrative Agent shall notify Carpenter and the Lenders of
any change in Bank of America’s prime rate used in determining the Base Rate
promptly following the public announcement of such change.

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

2.03 Bid Loans.

(a) General. Subject to the terms and conditions set forth herein, each Lender
agrees that Carpenter may from time to time request the Lenders to submit offers
to make loans (each such loan, a “Bid Loan”) to Carpenter in Dollars prior to
the Maturity Date pursuant to this Section 2.03; provided, however, that after
giving effect to any Bid Borrowing, the Total Outstandings shall not exceed the
Aggregate Commitments. There shall not be more than six different Interest
Periods in effect with respect to Bid Loans at any time.

(b) Requesting Competitive Bids. Carpenter may request the submission of
Competitive Bids by delivering a Bid Request to each of the Lenders (with a copy
to the Administrative Agent) not later than 12:00 noon (i) one Business Day
prior to the requested date of any Bid Borrowing that is to consist of Absolute
Rate Loans, or (ii) four Business Days prior to the requested date of any Bid
Borrowing that is to consist of Eurocurrency Margin Bid Loans. Each Bid Request
shall specify (A) the requested date of the Bid Borrowing (which shall be a
Business Day), (B) the aggregate principal amount of Bid Loans requested (which
must be $2,000,000 or a whole multiple of $1,000,000 in excess thereof), (C) the
Type of Bid Loans requested and (D) the duration of the Interest Period with
respect thereto, and shall be signed by a Responsible Officer of Carpenter. No
Bid Request shall contain a request for (y) more than one Type of Bid Loan or
(z) Bid Loans having more than three different Interest Periods. Unless the
Administrative Agent otherwise agrees in its sole and absolute discretion,
Carpenter may not submit a Bid Request if it has submitted another Bid Request
within the prior five Business Days.

(c) Submitting Competitive Bids.

(i) Each Lender may (but shall have no obligation to) submit a Competitive Bid
containing an offer to make one or more Bid Loans in response to such Bid
Request. Such

 

30

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

Competitive Bid must be delivered directly to Carpenter (with a copy to the
Administrative Agent) not later than 10:30 a.m. (A) on the requested date of any
Bid Borrowing that is to consist of Absolute Rate Loans, and (B) three Business
Days prior to the requested date of any Bid Borrowing that is to consist of
Eurocurrency Margin Bid Loans; provided, however, that any Competitive Bid
submitted by Bank of America in its capacity as a Lender in response to any Bid
Request must be submitted directly to Carpenter (with a copy to the
Administrative Agent) not later than 10:15 a.m. on the date on which Competitive
Bids are required to be delivered by the other Lenders in response to such Bid
Request. Each Competitive Bid shall specify (A) the proposed date of the Bid
Borrowing; (B) the principal amount of each Bid Loan for which such Competitive
Bid is being made, which principal amount (x) may be equal to, greater than or
less than the Commitment of the bidding Lender, (y) must be $2,000,000 or a
whole multiple of $1,000,000 in excess thereof, and (z) may not exceed the
principal amount of Bid Loans for which Competitive Bids were requested; (C) if
the proposed Bid Borrowing is to consist of Absolute Rate Bid Loans, the
Absolute Rate offered for each such Bid Loan and the Interest Period applicable
thereto; (D) if the proposed Bid Borrowing is to consist of Eurocurrency Margin
Bid Loans, the Eurocurrency Bid Margin with respect to each such Eurocurrency
Margin Bid Loan and the Interest Period applicable thereto; and (E) the identity
of the bidding Lender.

(ii) Any Competitive Bid shall be disregarded if it (A) is received after the
applicable time specified in clause (ii) above, (B) is not substantially in the
form of a Competitive Bid as specified herein, (C) contains qualifying,
conditional or similar language, (D) proposes terms other than or in addition to
those set forth in the applicable Bid Request, or (E) is otherwise not
responsive to such Bid Request. Any Lender may correct a Competitive Bid
containing a manifest error by submitting a corrected Competitive Bid
(identified as such) not later than the applicable time required for submission
of Competitive Bids. Any such submission of a corrected Competitive Bid shall
constitute a revocation of the Competitive Bid that contained the manifest
error. The Administrative Agent may, but shall not be required to, notify any
Lender of any manifest error it detects in such Lender’s Competitive Bid.

(iii) Subject only to the provisions of Sections 3.02, 3.03 and 4.02 and clause
(ii) above, each Competitive Bid shall be irrevocable.

(d) Notice of Competitive Bids. Not later than 11:30 a.m. (i) on the requested
date of any Bid Borrowing that is to consist of Absolute Rate Loans, or
(ii) three Business Days prior to the requested date of any Bid Borrowing that
is to consist of Eurocurrency Margin Bid Loans, Carpenter shall notify the
Administrative Agent of the identity of each Lender that has submitted a
Competitive Bid that complies with Section 2.03(c) and of the terms of the
offers contained in each such Competitive Bid.

(e) Acceptance of Competitive Bids. Not later than 12:30 p.m. (i) on the
requested date of any Bid Borrowing that is to consist of Absolute Rate Loans,
and (ii) three Business Days prior to the requested date of any Bid Borrowing
that is to consist of Eurocurrency Margin Bid Loans, Carpenter shall notify the
Lenders (with a copy to the Administrative Agent) of its acceptance or rejection
of the offers notified to it pursuant to Section 2.03(d). Carpenter shall be
under no obligation to accept any Competitive Bid and may choose to reject all
Competitive Bids. In the case of acceptance, such notice shall specify the
aggregate principal amount of Competitive Bids for each Interest Period that is
accepted. Carpenter may accept any Competitive Bid in whole or in part; provided
that:

(i) the aggregate principal amount of each Bid Borrowing may not exceed the
applicable amount set forth in the related Bid Request;

 

31

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

(ii) the principal amount of each Bid Loan must be $2,000,000 or a whole
multiple of $1,000,000 in excess thereof;

(iii) the acceptance of offers may be made only on the basis of ascending
Absolute Rates or Eurocurrency Bid Margins within each Interest Period; and

(iv) Carpenter may not accept any offer that is described in
Section 2.03(c)(iii) or that otherwise fails to comply with the requirements
hereof.

(f) Procedure for Identical Bids. If two or more Lenders have submitted
Competitive Bids at the same Absolute Rate or Eurocurrency Bid Margin, as the
case may be, for the same Interest Period, and the result of accepting all of
such Competitive Bids in whole (together with any other Competitive Bids at
lower Absolute Rates or Eurocurrency Bid Margins, as the case may be, accepted
for such Interest Period in conformity with the requirements of
Section 2.03(e)(iii)) would be to cause the aggregate outstanding principal
amount of the applicable Bid Borrowing to exceed the amount specified therefor
in the related Bid Request, then, unless otherwise agreed by Carpenter, the
Administrative Agent and such Lenders, such Competitive Bids shall be accepted
as nearly as possible in proportion to the amount offered by each such Lender in
respect of such Interest Period, with such accepted amounts being rounded to the
nearest whole multiple of $1,000,000.

(g) Notice to Lenders of Acceptance or Rejection of Bids. Carpenter shall
promptly notify each Lender having submitted a Competitive Bid whether (with a
copy to the Administrative Agent) or not its offer has been accepted and, if its
offer has been accepted, of the amount of the Bid Loan or Bid Loans to be made
by it on the date of the applicable Bid Borrowing. Any Competitive Bid or
portion thereof that is not accepted by Carpenter by the applicable time
specified in Section 2.03(e) shall be deemed rejected.

(h) Notice of Eurocurrency Base Rate. If any Bid Borrowing is to consist of
Eurocurrency Margin Bid Loans, the Administrative Agent shall determine the
Eurocurrency Base Rate for the relevant Interest Period, and promptly after
making such determination, shall notify Carpenter and the Lenders that will be
participating in such Bid Borrowing of such Eurocurrency Base Rate.

(i) Funding of Bid Loans. Upon satisfaction of the applicable conditions set
forth in Section 4.02, each Lender that has received notice pursuant to
Section 2.03(g) that all or a portion of its Competitive Bid has been accepted
by Carpenter shall (i) make the amount of its Bid Loan(s) promptly available to
Carpenter in immediately available funds and (ii) simultaneously deliver to the
Administrative Agent (A) a summary of the terms of such Bid Loan and (B) a copy
of all documentation delivered by such Lender to Carpenter in connection with
such Bid Loan.

(j) Notice of Range of Bids. After each Competitive Bid auction pursuant to this
Section 2.03, Carpenter shall notify each Lender (with a copy to the
Administrative Agent) that submitted a Competitive Bid in such auction of the
ranges of bids submitted (without the bidder’s name) and accepted for each Bid
Loan and the aggregate amount of each Bid Borrowing.

2.04 Letters of Credit.

(a) The Letter of Credit Commitment.

(i) Subject to the terms and conditions set forth herein, (A) the L/C Issuer
agrees, in reliance upon the agreements of the Lenders set forth in this
Section 2.04, (1) from time to time on any Business Day during the period from
the Closing Date until the Letter of Credit Expiration

 

32

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

Date, to issue Letters of Credit denominated in Dollars or in one or more
Alternative Currencies for the account of Carpenter or its Subsidiaries, and to
amend or extend Letters of Credit previously issued by it, in accordance with
subsection (b) below, and (2) to honor drawings under the Letters of Credit; and
(B) the Lenders severally agree to participate in Letters of Credit issued for
the account of Carpenter or its Subsidiaries and any drawings thereunder;
provided that after giving effect to any L/C Credit Extension with respect to
any Letter of Credit, (x) the Total Outstandings shall not exceed the Aggregate
Commitments, (y) the aggregate Outstanding Amount of the Committed Loans of any
Lender, plus such Lender’s Applicable Percentage of the Outstanding Amount of
all L/C Obligations, plus such Lender’s Applicable Percentage of the Outstanding
Amount of all Swing Line Loans shall not exceed such Lender’s Commitment, and
(z) the Outstanding Amount of the L/C Obligations shall not exceed the Letter of
Credit Sublimit. Each request by Carpenter for the issuance or amendment of a
Letter of Credit shall be deemed to be a representation by Carpenter that the
L/C Credit Extension so requested complies with the conditions set forth in the
proviso to the preceding sentence. Within the foregoing limits, and subject to
the terms and conditions hereof, Carpenter’s ability to obtain Letters of Credit
shall be fully revolving, and accordingly Carpenter may, during the foregoing
period, obtain Letters of Credit to replace Letters of Credit that have expired
or that have been drawn upon and reimbursed. All Existing Letters of Credit
shall be deemed to have been issued pursuant to this Agreement and from and
after the Closing Date shall be subject to and governed by the terms and
conditions hereof.

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

(A) subject to Section 2.04(b)(iii), the expiry date of such requested Letter of
Credit would occur more than twelve months after the date of issuance or last
extension, unless the Required Lenders have approved such expiry date; or

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

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

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

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

(C) except as otherwise agreed by the Administrative Agent and the L/C Issuer,
such Letter of Credit is in an initial stated amount less than $50,000, in the
case of a commercial Letter of Credit, or $50,000, in the case of a standby
Letter of Credit;

 

33

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

(D) except as otherwise agreed by the Administrative Agent and the L/C Issuer,
such Letter of Credit is to be denominated in a currency other than Dollars or
an Alternative Currency;

(E) the L/C Issuer does not as of the issuance date of such requested Letter of
Credit issue Letters of Credit in the requested currency;

(F) any Lender is at that time a Defaulting Lender, unless the L/C Issuer has
entered into arrangements, including the delivery of Cash Collateral,
satisfactory to the L/C Issuer (in its sole discretion) with Carpenter or such
Lender to eliminate the L/C Issuer’s actual or potential Fronting Exposure
(after giving effect to Section 2.18(a)(iv)) with respect to the Defaulting
Lender arising from either the Letter of Credit then proposed to be issued or
that Letter of Credit and all other L/C Obligations as to which the L/C Issuer
has actual or potential Fronting Exposure, as it may elect in its sole
discretion.

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

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

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

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

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

 

34

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

matters as the L/C Issuer may require. In the case of a request for an amendment
of any outstanding Letter of Credit, such Letter of Credit Application shall
specify in form and detail satisfactory to the L/C Issuer (A) the Letter of
Credit to be amended; (B) the proposed date of amendment thereof (which shall be
a Business Day); (C) the nature of the proposed amendment; and (D) such other
matters as the L/C Issuer may require. Additionally, Carpenter shall furnish to
the L/C Issuer and the Administrative Agent such other documents and information
pertaining to such requested Letter of Credit issuance or amendment, including
any Issuer Documents, as the L/C Issuer or the Administrative Agent may require.

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

(iii) If Carpenter so requests in any applicable Letter of Credit Application,
the L/C Issuer may, in its sole and absolute discretion, agree to issue a Letter
of Credit that has automatic extension provisions (each, an “Auto-Extension
Letter of Credit”); provided that any such Auto-Extension Letter of Credit must
permit the L/C Issuer to prevent any such extension at least once in each
twelve-month period (commencing with the date of issuance of such Letter of
Credit) by giving prior notice to the beneficiary thereof not later than a day
(the “Non-Extension Notice Date”) in each such twelve-month period to be agreed
upon at the time such Letter of Credit is issued. Unless otherwise directed by
the L/C Issuer, Carpenter shall not be required to make a specific request to
the L/C Issuer for any such extension. Once an Auto-Extension Letter of Credit
has been issued, the Lenders shall be deemed to have authorized (but may not
require) the L/C Issuer to permit the extension of such Letter of Credit at any
time to an expiry date not later than the Letter of Credit Expiration Date;
provided, however, that the L/C Issuer shall not permit any such extension if
(A) the L/C Issuer has determined that it would not be permitted, or would have
no obligation, at such time to issue such Letter of Credit in its revised form
(as extended) under the terms hereof (by reason of the provisions of clause
(ii) or (iii) of Section 2.04(a) or otherwise), or (B) it has received notice
(which may be by telephone or in writing) on or before the day that is seven
Business Days before the Non-Extension Notice Date (1) from the Administrative
Agent that the Required Lenders have elected not to permit such extension or
(2) from the Administrative Agent, any Lender or Carpenter that one or more of
the applicable conditions specified in Section 4.02 is not then satisfied, and
in each such case directing the L/C Issuer not to permit such extension.

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

 

35

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

(c) Drawings and Reimbursements; Funding of Participations.

(i) Upon receipt from the beneficiary of any Letter of Credit of any notice of a
drawing under such Letter of Credit, the L/C Issuer shall notify Carpenter and
the Administrative Agent thereof. In the case of a Letter of Credit denominated
in an Alternative Currency, Carpenter shall reimburse the L/C Issuer in such
Alternative Currency, unless (A) the L/C Issuer (at its option) shall have
specified in such notice that it will require reimbursement in Dollars, or
(B) in the absence of any such requirement for reimbursement in Dollars,
Carpenter shall have notified the L/C Issuer promptly following receipt of the
notice of drawing that Carpenter will reimburse the L/C Issuer in Dollars. In
the case of any such reimbursement in Dollars of a drawing under a Letter of
Credit denominated in an Alternative Currency, the L/C Issuer shall notify
Carpenter of the Dollar Equivalent of the amount of the drawing promptly
following the determination thereof. Not later than 11:00 a.m. on the date of
any payment by the L/C Issuer under a Letter of Credit to be reimbursed in
Dollars, or the Applicable Time on the date of any payment by the L/C Issuer
under a Letter of Credit to be reimbursed in an Alternative Currency (each such
date, an “Honor Date”), Carpenter shall reimburse the L/C Issuer through the
Administrative Agent in an amount equal to the amount of such drawing and in the
applicable currency. If Carpenter fails to so reimburse the L/C Issuer by such
time, the Administrative Agent shall promptly notify each Lender of the Honor
Date, the amount of the unreimbursed drawing (expressed in Dollars in the amount
of the Dollar Equivalent thereof in the case of a Letter of Credit denominated
in an Alternative Currency) (the “Unreimbursed Amount”), and the amount of such
Lender’s Applicable Percentage thereof. In such event, Carpenter shall be deemed
to have requested a Committed Borrowing of Base Rate Loans to be disbursed on
the Honor Date in an amount equal to the Unreimbursed Amount, without regard to
the minimum and multiples specified in Section 2.02 for the principal amount of
Base Rate Loans, but subject to the amount of the unutilized portion of the
Aggregate Commitments and the conditions set forth in Section 4.02 (other than
the delivery of a Committed Loan Notice). Any notice given by the L/C Issuer or
the Administrative Agent pursuant to this Section 2.04(c)(i) may be given by
telephone if immediately confirmed in writing; provided that the lack of such an
immediate confirmation shall not affect the conclusiveness or binding effect of
such notice.

(ii) Each Lender shall upon any notice pursuant to Section 2.04(c)(i) make funds
available to the Administrative Agent (and the Administrative Agent may apply
Cash Collateral provided for this purpose) for the account of the L/C Issuer, in
Dollars, at the Administrative Agent’s Office for Dollar-denominated payments in
an amount equal to its Applicable Percentage of the Unreimbursed Amount not
later than 1:00 p.m. on the Business Day specified in such notice by the
Administrative Agent, whereupon, subject to the provisions of
Section 2.04(c)(iii), each Lender that so makes funds available shall be deemed
to have made a Base Rate Committed Loan to Carpenter in such amount. The
Administrative Agent shall remit the funds so received to the L/C Issuer in
Dollars.

(iii) With respect to any Unreimbursed Amount that is not fully refinanced by a
Committed Borrowing of Base Rate Loans because the conditions set forth in
Section 4.02 cannot be satisfied or for any other reason, Carpenter shall be
deemed to have incurred from the L/C Issuer an L/C Borrowing in the amount of
the Unreimbursed Amount that is not so refinanced, which L/C Borrowing shall be
due and payable on demand (together with interest) and shall bear interest at
the Default Rate. In such event, each Lender’s payment to the Administrative
Agent for the account of the L/C Issuer pursuant to Section 2.04(c)(ii) shall be
deemed payment in respect of its participation in such L/C Borrowing and shall
constitute an L/C Advance from such Lender in satisfaction of its participation
obligation under this Section 2.04.

 

36

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

(iv) Until each Lender funds its Committed Loan or L/C Advance pursuant to this
Section 2.04(c) to reimburse the L/C Issuer for any amount drawn under any
Letter of Credit, interest in respect of such Lender’s Applicable Percentage of
such amount shall be solely for the account of the L/C Issuer.

(v) Each Lender’s obligation to make Committed Loans or L/C Advances to
reimburse the L/C Issuer for amounts drawn under Letters of Credit, as
contemplated by this Section 2.04(c), shall be absolute and unconditional and
shall not be affected by any circumstance, including (A) any setoff,
counterclaim, recoupment, defense or other right which such Lender may have
against the L/C Issuer, Carpenter, any Subsidiary or any other Person for any
reason whatsoever; (B) the occurrence or continuance of a Default, or (C) any
other occurrence, event or condition, whether or not similar to any of the
foregoing; provided, however, that each Lender’s obligation to make Committed
Loans pursuant to this Section 2.04(c) is subject to the conditions set forth in
Section 4.02 (other than delivery by Carpenter of a Committed Loan Notice). No
such making of an L/C Advance shall relieve or otherwise impair the obligation
of Carpenter to reimburse the L/C Issuer for the amount of any payment made by
the L/C Issuer under any Letter of Credit, together with interest as provided
herein.

(vi) If any Lender fails to make available to the Administrative Agent for the
account of the L/C Issuer any amount required to be paid by such Lender pursuant
to the foregoing provisions of this Section 2.04(c) by the time specified in
Section 2.04(c)(ii), the L/C Issuer shall be entitled to recover from such
Lender (acting through the Administrative Agent), on demand, such amount with
interest thereon for the period from the date such payment is required to the
date on which such payment is immediately available to the L/C Issuer at a rate
per annum equal to the applicable Overnight Rate from time to time in effect,
plus any administrative, processing or similar fees customarily charged by the
L/C Issuer in connection with the foregoing. If such Lender pays such amount
(with interest and fees as aforesaid), the amount so paid shall constitute such
Lender’s Committed Loan included in the relevant Committed Borrowing or L/C
Advance in respect of the relevant L/C Borrowing, as the case may be. A
certificate of the L/C Issuer submitted to any Lender (through the
Administrative Agent) with respect to any amounts owing under this clause
(vi) shall be conclusive absent manifest error.

(d) Repayment of Participations.

(i) At any time after the L/C Issuer has made a payment under any Letter of
Credit and has received from any Lender such Lender’s L/C Advance in respect of
such payment in accordance with Section 2.04(c), if the Administrative Agent
receives for the account of the L/C Issuer any payment in respect of the related
Unreimbursed Amount or interest thereon (whether directly from Carpenter or
otherwise, including proceeds of Cash Collateral applied thereto by the
Administrative Agent), the Administrative Agent will distribute to such Lender
its Applicable Percentage thereof in Dollars and in the same funds as those
received by the Administrative Agent.

(ii) If any payment received by the Administrative Agent for the account of the
L/C Issuer pursuant to Section 2.04(c)(i) is required to be returned under any
of the circumstances described in Section 11.05 (including pursuant to any
settlement entered into by the L/C Issuer in its discretion), each Lender shall
pay to the Administrative Agent for the account of the L/C Issuer its Applicable
Percentage thereof on demand of the Administrative Agent, plus interest

 

37

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

thereon from the date of such demand to the date such amount is returned by such
Lender, at a rate per annum equal to the applicable Overnight Rate from time to
time in effect. The obligations of the Lenders under this clause shall survive
the payment in full of the Obligations and the termination of this Agreement.

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

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

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

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

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

(v) any adverse change in the relevant exchange rates or in the availability of
the relevant Alternative Currency to Carpenter or any Subsidiary or in the
relevant currency markets generally; or

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

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

(f) Role of L/C Issuer. Each Lender and Carpenter agree that, in paying any
drawing under a Letter of Credit, the L/C Issuer shall not have any
responsibility to obtain any document (other than any sight draft, certificates
and documents expressly required by the Letter of Credit) or to ascertain or
inquire as to the validity or accuracy of any such document or the authority of
the Person executing or delivering any such document. None of the L/C Issuer,
the Administrative Agent, any of their respective Related

 

38

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

Parties nor any correspondent, participant or assignee of the L/C Issuer shall
be liable to any Lender for (i) any action taken or omitted in connection
herewith at the request or with the approval of the Lenders or the Required
Lenders, as applicable; (ii) any action taken or omitted in the absence of gross
negligence or willful misconduct; or (iii) the due execution, effectiveness,
validity or enforceability of any document or instrument related to any Letter
of Credit or Issuer Document. Carpenter hereby assumes all risks of the acts or
omissions of any beneficiary or transferee with respect to its use of any Letter
of Credit; provided, however, that this assumption is not intended to, and shall
not, preclude Carpenter’s pursuing such rights and remedies as it may have
against the beneficiary or transferee at law or under any other agreement. None
of the L/C Issuer, the Administrative Agent, any of their respective Related
Parties nor any correspondent, participant or assignee of the L/C Issuer shall
be liable or responsible for any of the matters described in clauses (i) through
(v) of Section 2.04(e); provided, however, that anything in such clauses to the
contrary notwithstanding, Carpenter may have a claim against the L/C Issuer, and
the L/C Issuer may be liable to Carpenter, to the extent, but only to the
extent, of any direct, as opposed to consequential or exemplary, damages
suffered by Carpenter which Carpenter proves were caused by the L/C Issuer’s
willful misconduct or gross negligence or the L/C Issuer’s willful failure to
pay under any Letter of Credit after the presentation to it by the beneficiary
of a sight draft and certificate(s) strictly complying with the terms and
conditions of a Letter of Credit. In furtherance and not in limitation of the
foregoing, the L/C Issuer may accept documents that appear on their face to be
in order, without responsibility for further investigation, regardless of any
notice or information to the contrary, and the L/C Issuer shall not be
responsible for the validity or sufficiency of any instrument transferring or
assigning or purporting to transfer or assign a Letter of Credit or the rights
or benefits thereunder or proceeds thereof, in whole or in part, which may prove
to be invalid or ineffective for any reason.

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

(h) Letter of Credit Fees. Carpenter shall pay to the Administrative Agent for
the account of each Lender in accordance with its Applicable Percentage, in
Dollars, a Letter of Credit fee (the “Letter of Credit Fee”) for each Letter of
Credit equal to the Applicable Rate times the Dollar Equivalent of the daily
amount available to be drawn under such Letter of Credit; provided that any
Letter of Credit Fees otherwise payable for the account of a Defaulting Lender
with respect to any Letter of Credit as to which such Defaulting Lender has not
provided Cash Collateral satisfactory to the L/C Issuer pursuant to this
Section 2.04 shall be payable, to the maximum extent permitted by applicable
Law, to the other Lenders in accordance with the upward adjustments in their
respective Applicable Percentages allocable to such Letter of Credit pursuant to
Section 2.18(a)(iv), with the balance of such fee, if any, payable to the L/C
Issuer for its own account. For purposes of computing the daily amount available
to be drawn under any Letter of Credit, the amount of such Letter of Credit
shall be determined in accordance with Section 1.09. Letter of Credit Fees shall
be (i) due and payable on the first Business Day after the end of each March,
June, September and December, commencing with the first such date to occur after
the issuance of such Letter of Credit, on the Letter of Credit Expiration Date
and thereafter on demand and (ii) computed on a quarterly basis in arrears. If
there is any change in the Applicable Rate during any quarter, the daily amount
available to be drawn under each Letter of Credit shall be computed and
multiplied by the Applicable Rate separately for each period during such quarter
that such Applicable Rate was in effect. Notwithstanding anything to the
contrary contained herein, upon the request of the Required Lenders, while any
Event of Default exists, all Letter of Credit Fees shall accrue at the Default
Rate.

(i) Fronting Fee and Documentary and Processing Charges Payable to L/C Issuer.
Carpenter shall pay directly to the L/C Issuer for its own account, in Dollars,
a fronting fee (i) with respect to each

 

39

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

commercial Letter of Credit, at the rate specified in the Administrative Agent’s
Fee Letter, computed on the Dollar Equivalent of the amount of such Letter of
Credit, and payable upon the issuance thereof, (ii) with respect to any
amendment of a commercial Letter of Credit increasing the amount of such Letter
of Credit, at a rate separately agreed between Carpenter and the L/C Issuer,
computed on the Dollar Equivalent of the amount of such increase, and payable
upon the effectiveness of such amendment, and (iii) with respect to each standby
Letter of Credit, at the rate per annum specified in the Administrative Agent’s
Fee Letter, computed on the Dollar Equivalent of the daily amount available to
be drawn under such Letter of Credit on a quarterly basis in arrears; provided
that, notwithstanding anything to the contrary in the Administrative Agent’s Fee
Letter, all fronting fees on commercial Letters of Credit shall be paid as set
forth above, by applying the rate specified in the Administrative Agent’s Fee
Letter without any per annum adjustment and payable upon issuance or
effectiveness, as applicable. Such fronting fee shall be due and payable on the
tenth Business Day after the end of each March, June, September and December in
respect of the most recently-ended quarterly period (or portion thereof, in the
case of the first payment), commencing with the first such date to occur after
the issuance of such Letter of Credit, on the Letter of Credit Expiration Date
and thereafter on demand. For purposes of computing the daily amount available
to be drawn under any Letter of Credit, the amount of such Letter of Credit
shall be determined in accordance with Section 1.09. In addition, Carpenter
shall pay directly to the L/C Issuer for its own account, in Dollars, the
customary issuance, presentation, amendment and other processing fees, and other
standard costs and charges, of the L/C Issuer relating to letters of credit as
from time to time in effect. Such customary fees and standard costs and charges
are due and payable on demand and are nonrefundable.

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

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

2.05 Swing Line Loans.

(a) The Swing Line. Subject to the terms and conditions set forth herein, the
Swing Line Lender agrees, in its sole discretion (it being understood that
unless a Default or an Event of Default has occurred and is continuing or any
Lender is a Defaulting Lender (subject to Section 2.18), the Swing Line Lender
anticipates funding Swing Line Loans in accordance with the terms hereof) and in
reliance upon the agreements of the other Lenders set forth in this
Section 2.05, to make loans in Dollars (each such loan, a “Swing Line Loan”) to
Carpenter from time to time on any Business Day during the Availability Period
in an aggregate amount not to exceed at any time outstanding the amount of the
Swing Line Sublimit, notwithstanding the fact that such Swing Line Loans, when
aggregated with the Applicable Percentage of the Outstanding Amount of Committed
Loans and L/C Obligations of the Lender acting as Swing Line Lender, may exceed
the amount of such Lender’s Commitment; provided, however, that after giving
effect to any Swing Line Loan, (i) the Total Outstandings shall not exceed the
Aggregate Commitments, and (ii) the aggregate Outstanding Amount of the
Committed Loans of any Lender, plus such Lender’s Applicable Percentage of the
Outstanding Amount of all L/C Obligations, plus such Lender’s Applicable
Percentage of the Outstanding Amount of all Swing Line Loans shall not exceed
such Lender’s Commitment, and provided, further, that Carpenter shall not use
the proceeds of any Swing Line Loan to refinance any outstanding Swing Line
Loan. Within the foregoing limits, and subject to the other terms and conditions
hereof, Carpenter may borrow under this Section 2.05, prepay under Section

 

40

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

2.06, and reborrow under this Section 2.05. Each Swing Line Loan shall be a Base
Rate Loan. Immediately upon the making of a Swing Line Loan, each Lender shall
be deemed to, and hereby irrevocably and unconditionally agrees to, purchase
from the Swing Line Lender a risk participation in such Swing Line Loan in an
amount equal to the product of such Lender’s Applicable Percentage times the
amount of such Swing Line Loan.

(b) Borrowing Procedures. Each Swing Line Borrowing shall be made upon
Carpenter’s irrevocable notice to the Swing Line Lender and the Administrative
Agent, which may be given by telephone. Each such notice must be received by the
Swing Line Lender and the Administrative Agent not later than 1:00 p.m. on the
requested borrowing date, and shall specify (i) the amount to be borrowed, which
shall be a minimum of $1,000,000 or a whole multiple of $100,000 in excess
thereof, and (ii) the requested borrowing date, which shall be a Business Day.
Each such telephonic notice must be confirmed promptly by delivery to the Swing
Line Lender and the Administrative Agent of a written Swing Line Loan Notice,
appropriately completed and signed by a Responsible Officer of Carpenter.
Promptly after receipt by the Swing Line Lender of any telephonic Swing Line
Loan Notice, the Swing Line Lender will confirm with the Administrative Agent
(by telephone or in writing) that the Administrative Agent has also received
such Swing Line Loan Notice and, if not, the Swing Line Lender will notify the
Administrative Agent (by telephone or in writing) of the contents thereof.
Unless the Swing Line Lender has received notice (by telephone or in writing)
from the Administrative Agent (including at the request of any Lender) prior to
2:00 p.m. on the date of the proposed Swing Line Borrowing (A) directing the
Swing Line Lender not to make such Swing Line Loan as a result of the
limitations set forth in the first proviso to the first sentence of
Section 2.05(a), or (B) that one or more of the applicable conditions specified
in Article IV is not then satisfied, then, subject to the terms and conditions
hereof, the Swing Line Lender will, not later than 3:00 p.m. on the borrowing
date specified in such Swing Line Loan Notice, make the amount of its Swing Line
Loan available to Carpenter at its office by crediting the account of Carpenter
on the books of the Swing Line Lender in Same Day Funds.

(c) Refinancing of Swing Line Loans.

(i) The Swing Line Lender at any time in its sole and absolute discretion may
request, on behalf of Carpenter (which hereby irrevocably authorizes the Swing
Line Lender to so request on its behalf), that each Lender make a Base Rate
Committed Loan in an amount equal to such Lender’s Applicable Percentage of the
amount of Swing Line Loans then outstanding. Such request shall be made in
writing (which written request shall be deemed to be a Committed Loan Notice for
purposes hereof) and in accordance with the requirements of Section 2.02,
without regard to the minimum and multiples specified therein for the principal
amount of Base Rate Loans, but subject to the unutilized portion of the
Aggregate Commitments and the conditions set forth in Section 4.02. The Swing
Line Lender shall furnish Carpenter with a copy of the applicable Committed Loan
Notice promptly after delivering such notice to the Administrative Agent. Each
Lender shall make an amount equal to its Applicable Percentage of the amount
specified in such Committed Loan Notice available to the Administrative Agent in
Same Day Funds (and the Administrative Agent may apply Cash Collateral available
with respect to the applicable Swing Line Loan) for the account of the Swing
Line Lender at the Administrative Agent’s Office for Dollar-denominated payments
not later than 1:00 p.m. on the day specified in such Committed Loan Notice,
whereupon, subject to Section 2.05(c)(ii), each Lender that so makes funds
available shall be deemed to have made a Base Rate Committed Loan to Carpenter
in such amount. The Administrative Agent shall remit the funds so received to
the Swing Line Lender.

(ii) If for any reason any Swing Line Loan cannot be refinanced by such a
Committed Borrowing in accordance with Section 2.05(c)(i), the request for Base
Rate

 

41

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

Committed Loans submitted by the Swing Line Lender as set forth herein shall be
deemed to be a request by the Swing Line Lender that each of the Lenders fund
its risk participation in the relevant Swing Line Loan and each Lender’s payment
to the Administrative Agent for the account of the Swing Line Lender pursuant to
Section 2.05(c)(i) shall be deemed payment in respect of such participation.

(iii) If any Lender fails to make available to the Administrative Agent for the
account of the Swing Line Lender any amount required to be paid by such Lender
pursuant to the foregoing provisions of this Section 2.05(c) by the time
specified in Section 2.05(c)(i), the Swing Line Lender shall be entitled to
recover from such Lender (acting through the Administrative Agent), on demand,
such amount with interest thereon for the period from the date such payment is
required to the date on which such payment is immediately available to the Swing
Line Lender at a rate per annum equal to the applicable Overnight Rate from time
to time in effect, plus any administrative, processing or similar fees
customarily charged by the Swing Line Lender in connection with the foregoing.
If such Lender pays such amount (with interest and fees as aforesaid), the
amount so paid shall constitute such Lender’s Committed Loan included in the
relevant Committed Borrowing or funded participation in the relevant Swing Line
Loan, as the case may be. A certificate of the Swing Line Lender submitted to
any Lender (through the Administrative Agent) with respect to any amounts owing
under this clause (iii) shall be conclusive absent manifest error.

(iv) Each Lender’s obligation to make Committed Loans or to purchase and fund
risk participations in Swing Line Loans pursuant to this Section 2.05(c) shall
be absolute and unconditional and shall not be affected by any circumstance,
including (A) any setoff, counterclaim, recoupment, defense or other right which
such Lender may have against the Swing Line Lender, Carpenter or any other
Person for any reason whatsoever, (B) the occurrence or continuance of a
Default, or (C) any other occurrence, event or condition, whether or not similar
to any of the foregoing; provided, however, that each Lender’s obligation to
make Committed Loans pursuant to this Section 2.05(c) is subject to the
conditions set forth in Section 4.02. No such funding of risk participations
shall relieve or otherwise impair the obligation of Carpenter to repay Swing
Line Loans, together with interest as provided herein.

(d) Repayment of Participations.

(i) At any time after any Lender has purchased and funded a risk participation
in a Swing Line Loan, if the Swing Line Lender receives any payment on account
of such Swing Line Loan, the Swing Line Lender will distribute to such Lender
its Applicable Percentage thereof in the same funds as those received by the
Swing Line Lender.

(ii) If any payment received by the Swing Line Lender in respect of principal or
interest on any Swing Line Loan is required to be returned by the Swing Line
Lender under any of the circumstances described in Section 11.05 (including
pursuant to any settlement entered into by the Swing Line Lender in its
discretion), each Lender shall pay to the Swing Line Lender its Applicable
Percentage thereof on demand of the Administrative Agent, plus interest thereon
from the date of such demand to the date such amount is returned, at a rate per
annum equal to the applicable Overnight Rate. The Administrative Agent will make
such demand upon the request of the Swing Line Lender. The obligations of the
Lenders under this clause shall survive the payment in full of the Obligations
and the termination of this Agreement.

(e) Interest for Account of Swing Line Lender. The Swing Line Lender shall be
responsible for invoicing Carpenter for interest on the Swing Line Loans. Until
each Lender funds its Base Rate

 

42

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

Committed Loan or risk participation pursuant to this Section 2.05 to refinance
such Lender’s Applicable Percentage of any Swing Line Loan, interest in respect
of such Applicable Percentage shall be solely for the account of the Swing Line
Lender.

(f) Payments Directly to Swing Line Lender. Carpenter shall make all payments of
principal and interest in respect of the Swing Line Loans directly to the Swing
Line Lender.

2.06 Prepayments. (a) Each Borrower may, upon notice from Carpenter to the
Administrative Agent, at any time or from time to time voluntarily prepay
Committed Loans in whole or in part without premium or penalty; provided that
(i) such notice must be received by the Administrative Agent not later than
11:00 a.m. (A) three Business Days prior to any date of prepayment of
Eurocurrency Rate Loans denominated in Dollars, (B) four Business Days (or five,
in the case of prepayment of Loans denominated in Special Notice Currencies)
prior to any date of prepayment of Eurocurrency Rate Loans denominated in
Alternative Currencies, and (C) on the date of prepayment of Base Rate Committed
Loans; (ii) any prepayment of Eurocurrency Rate Loans denominated in Dollars
shall be in a principal amount of $1,000,000 or a whole multiple of $500,000 in
excess thereof; (iii) any prepayment of Eurocurrency Rate Loans denominated in
Alternative Currencies shall be in a minimum principal amount of $1,000,000 or a
whole multiple of $500,000 in excess thereof; and (iv) any prepayment of Base
Rate Committed Loans shall be in a principal amount of $500,000 or a whole
multiple of $100,000 in excess thereof or, in each case, if less, the entire
principal amount thereof then outstanding. Each such notice shall specify the
date and amount of such prepayment and the Type(s) of Committed Loans to be
prepaid and, if Eurocurrency Rate Loans are to be prepaid, the Interest
Period(s) of such Loans. The Administrative Agent will promptly notify each
Lender of its receipt of each such notice, and of the amount of such Lender’s
Applicable Percentage of such prepayment. If such notice is given by Carpenter,
the applicable Borrower shall make such prepayment and the payment amount
specified in such notice shall be due and payable on the date specified therein.
Any prepayment of a Eurocurrency Rate Loan shall be accompanied by all accrued
interest on the amount prepaid, together with any additional amounts required
pursuant to Section 3.05. Subject to Section 2.18, each such prepayment shall be
applied to the Committed Loans of the Lenders in accordance with their
respective Applicable Percentages.

(b) No Bid Loan may be prepaid without the prior consent of the applicable Bid
Loan Lender.

(c) Carpenter may, upon notice to the Swing Line Lender (with a copy to the
Administrative Agent), at any time or from time to time, voluntarily prepay
Swing Line Loans in whole or in part without premium or penalty; provided that
(i) such notice must be received by the Swing Line Lender and the Administrative
Agent not later than 1:00 p.m. on the date of the prepayment, and (ii) any such
prepayment shall be in a minimum principal amount of $100,000. Each such notice
shall specify the date and amount of such prepayment. If such notice is given by
Carpenter, Carpenter shall make such prepayment and the payment amount specified
in such notice shall be due and payable on the date specified therein.

(d) If the Administrative Agent notifies Carpenter at any time that the Total
Outstandings at such time exceed an amount equal to 105% of the Aggregate
Commitments then in effect, then, within two Business Days after receipt of such
notice, the Borrowers shall prepay Loans and/or Carpenter shall Cash
Collateralize the L/C Obligations in an aggregate amount sufficient to reduce
such Outstanding Amount as of such date of payment to an amount not to exceed
100% of the Aggregate Commitments then in effect; provided, however, that
Carpenter shall not be required to Cash Collateralize the L/C Obligations
pursuant to this Section 2.06(c) unless after the prepayment in full of the
Loans the Total Outstandings exceed the Aggregate Commitments then in effect.
The Administrative Agent may, at any time and from time to time after the
initial deposit of such Cash Collateral, request that additional Cash Collateral
be provided in order to protect against the results of further exchange rate
fluctuations.

 

43

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

2.07 Termination or Reduction of Commitments. Carpenter may, upon notice to the
Administrative Agent, terminate the Aggregate Commitments, or from time to time
permanently reduce the Aggregate Commitments; provided that (i) any such notice
shall be received by the Administrative Agent not later than 11:00 a.m. five
Business Days prior to the date of termination or reduction, (ii) any such
partial reduction shall be in an aggregate amount of $10,000,000 or any whole
multiple of $1,000,000 in excess thereof, (iii) Carpenter shall not terminate or
reduce the Aggregate Commitments if, after giving effect thereto and to any
concurrent prepayments hereunder, the Total Outstandings would exceed the
Aggregate Commitments, and (iv) if, after giving effect to any reduction of the
Aggregate Commitments, the Letter of Credit Sublimit or the Swing Line Sublimit
exceeds the amount of the Aggregate Commitments, such sublimit shall be
automatically reduced by the amount of such excess. The Administrative Agent
will promptly notify the Lenders of any such notice of termination or reduction
of the Aggregate Commitments. The amount of any such Aggregate Commitment
reduction shall not be applied to the Letter of Credit Sublimit unless otherwise
specified by Carpenter. Any reduction of the Aggregate Commitments shall be
applied to the Commitment of each Lender according to its Applicable Percentage.
All fees accrued until the effective date of any termination of the Aggregate
Commitments shall be paid on the effective date of such termination.

2.08 Repayment of Loans. (a) Each Borrower shall repay to the Lenders on the
Maturity Date the aggregate principal amount of Committed Loans made to such
Borrower outstanding on such date.

(b) Carpenter shall repay each Bid Loan on the last day of the Interest Period
in respect thereof.

(c) Carpenter shall repay each Swing Line Loan on the earlier to occur of
(i) the date ten Business Days after such Loan is made and (ii) the Maturity
Date.

2.09 Interest. (a) Subject to the provisions of subsection (b) below, (i) each
Eurocurrency Rate Loan shall bear interest on the outstanding principal amount
thereof for each Interest Period at a rate per annum equal to the Eurocurrency
Rate for such Interest Period plus the Applicable Rate plus (in the case of a
Eurocurrency Rate Loan of any Lender which is lent from a Lending Office in the
United Kingdom or a Participating Member State) the Mandatory Cost, (ii) each
Base Rate Committed Loan shall bear interest on the outstanding principal amount
thereof from the applicable borrowing date at a rate per annum equal to the Base
Rate plus the Applicable Rate, (iii) each Bid Loan shall bear interest on the
outstanding principal amount thereof for the Interest Period therefor at a rate
per annum equal to the Eurocurrency Base Rate for such Interest Period plus (or
minus) the Eurocurrency Bid Margin, or at the Absolute Rate for such Interest
Period, as the case may be and (iv) each Swing Line Loan shall bear interest on
the outstanding principal amount thereof from the applicable borrowing date at a
rate per annum equal to the Base Rate plus the Applicable Rate.

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

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

 

44

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

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

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

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

(d) For the purposes of the Interest Act (Canada), (i) whenever a rate of
interest or fee rate hereunder is calculated on the basis of a year (the “deemed
year”) that contains fewer days than the actual number of days in the calendar
year of calculation, such rate of interest or fee rate shall be expressed as a
yearly rate by multiplying such rate of interest or fee rate by the actual
number of days in the calendar year of calculation and dividing it by the number
of days in the deemed year, (ii) the principle of deemed reinvestment of
interest shall not apply to any interest calculation hereunder and (iii) the
rates of interest stipulated herein are intended to be nominal rates and not
effective rates or yields.

2.10 Fees. In addition to certain fees described in subsections (h) and (i) of
Section 2.04:

(a) Facility Fee. Carpenter shall pay to the Administrative Agent for the
account of each Lender in accordance with its Applicable Percentage, a facility
fee in Dollars equal to the Applicable Rate times the actual daily amount of the
Aggregate Commitments (or, if the Aggregate Commitments have terminated, on the
Outstanding Amount of all Committed Loans, Swing Line Loans and L/C
Obligations), regardless of usage, subject to adjustment as provided in
Section 2.18. The facility fee shall accrue at all times during the Availability
Period (and thereafter so long as any Committed Loans, Swing Line Loans or L/C
Obligations remain outstanding), including at any time during which one or more
of the conditions in Article IV is not met, and shall be due and payable
quarterly in arrears on the last Business Day of each March, June, September and
December, commencing with the first such date to occur after the Closing Date,
and on the last day of the Availability Period (and, if applicable, thereafter
on demand). The facility fee shall be calculated quarterly in arrears, and if
there is any change in the Applicable Rate during any quarter, the actual daily
amount shall be computed and multiplied by the Applicable Rate separately for
each period during such quarter that such Applicable Rate was in effect.

(b) Other Fees. (i) Carpenter shall pay to the Arrangers and the Administrative
Agent for their own respective accounts, in Dollars, fees in the amounts, at the
times and to the parties specified in each Fee Letter. Such fees shall be fully
earned when paid and shall not be refundable for any reason whatsoever.

(ii) Carpenter shall pay to the Lenders, in Dollars, such fees as shall have
been separately agreed upon in writing in the amounts and at the times so
specified. Such fees shall be fully earned when paid and shall not be refundable
for any reason whatsoever.

2.11 Computation of Interest and Fees. All computations of interest for Base
Rate Loans shall be made on the basis of a year of 365 or 366 days, as the case
may be, and actual days elapsed. All

 

45

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

other computations of fees and interest shall be made on the basis of a 360-day
year and actual days elapsed (which results in more fees or interest, as
applicable, being paid than if computed on the basis of a 365-day year), or, in
the case of interest in respect of Committed Loans denominated in Alternative
Currencies as to which market practice differs from the foregoing, in accordance
with such market practice. Interest shall accrue on each Loan for the day on
which the Loan is made, and shall not accrue on a Loan, or any portion thereof,
for the day on which the Loan or such portion is paid, provided that any Loan
that is repaid on the same day on which it is made shall, subject to
Section 2.13(a), bear interest for one day. Each determination by the
Administrative Agent of an interest rate or fee hereunder shall be conclusive
and binding for all purposes, absent manifest error.

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

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

2.13 Payments Generally; Administrative Agent’s Clawback. (a) General. All
payments to be made by the Borrowers shall be made without condition or
deduction for any counterclaim, defense, recoupment or setoff. Except as
otherwise expressly provided herein and except with respect to principal of and
interest on Loans denominated in an Alternative Currency, all payments by the
Borrowers hereunder shall be made to the Administrative Agent, for the account
of the respective Lenders to which such payment is owed, at the applicable
Administrative Agent’s Office in Dollars and in Same Day Funds not later than
2:00 p.m. on the date specified herein. Except as otherwise expressly provided
herein, all payments by the Borrowers hereunder with respect to principal and
interest on Loans denominated in an Alternative Currency shall be made to the
Administrative Agent, for the account of the respective Lenders to which such
payment is owed, at the applicable Administrative Agent’s Office in such
Alternative Currency and in Same Day Funds not later than the Applicable Time
specified by the Administrative Agent on the dates specified herein. Without
limiting the generality of the foregoing, the Administrative Agent may require
that any payments due under this Agreement be made in the United States. If, for
any reason, any Borrower is prohibited by any Law from making any required
payment hereunder in an Alternative Currency, such Borrower shall make such
payment in Dollars in the Dollar Equivalent of the Alternative Currency payment
amount. The Administrative Agent will promptly distribute to each Lender its
Applicable Percentage (or other applicable share as provided herein) of such
payment in like funds as received by wire transfer to such Lender’s Lending
Office. All payments received by the Administrative Agent (i) after 2:00 p.m.,
in the case of payments in Dollars, or (ii) after the Applicable

 

46

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

Time specified by the Administrative Agent in the case of payments in an
Alternative Currency, shall in each case be deemed received on the next
succeeding Business Day and any applicable interest or fee shall continue to
accrue. If any payment to be made by any Borrower shall come due on a day other
than a Business Day, payment shall be made on the next following Business Day,
and such extension of time shall be reflected in computing interest or fees, as
the case may be.

(b) (i) Funding by Lenders; Presumption by Administrative Agent. Unless the
Administrative Agent shall have received notice from a Lender prior to the
proposed date of any Committed Borrowing of Eurocurrency Rate Loans (or, in the
case of any Committed Borrowing of Base Rate Loans, prior to 12:00 noon on the
date of such Committed Borrowing) that such Lender will not make available to
the Administrative Agent such Lender’s share of such Committed Borrowing, the
Administrative Agent may assume that such Lender has made such share available
on such date in accordance with Section 2.02 (or, in the case of a Committed
Borrowing of Base Rate Loans, that such Lender has made such share available in
accordance with and at the time required by Section 2.02) and may, in reliance
upon such assumption, make available to the applicable Borrower a corresponding
amount. In such event, if a Lender has not in fact made its share of the
applicable Committed Borrowing available to the Administrative Agent, then the
applicable Lender and the applicable Borrower severally agree to pay to the
Administrative Agent forthwith on demand such corresponding amount in Same Day
Funds with interest thereon, for each day from and including the date such
amount is made available to such Borrower to but excluding the date of payment
to the Administrative Agent, at (A) in the case of a payment to be made by such
Lender, the Overnight Rate, plus any administrative, processing or similar fees
customarily charged by the Administrative Agent in connection with the
foregoing, and (B) in the case of a payment to be made by such Borrower, the
interest rate applicable to Base Rate Loans. If such Borrower and such Lender
shall pay such interest to the Administrative Agent for the same or an
overlapping period, the Administrative Agent shall promptly remit to such
Borrower the amount of such interest paid by such Borrower for such period. If
such Lender pays its share of the applicable Committed Borrowing to the
Administrative Agent, then the amount so paid shall constitute such Lender’s
Committed Loan included in such Committed Borrowing. Any payment by such
Borrower shall be without prejudice to any claim such Borrower may have against
a Lender that shall have failed to make such payment to the Administrative
Agent.

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

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

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

 

47

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

(d) Obligations of Lenders Several. The obligations of the Lenders hereunder to
make Committed Loans, to fund participations in Letters of Credit and Swing Line
Loans and to make payments pursuant to Section 11.04(c) are several and not
joint. The failure of any Lender to make any Committed Loan, to fund any such
participation or to make any payment under Section 11.04(c) on any date required
hereunder shall not relieve any other Lender of its corresponding obligation to
do so on such date, and no Lender shall be responsible for the failure of any
other Lender to so make its Committed Loan, to purchase its participation or to
make its payment under Section 11.04(c).

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

2.14 Sharing of Payments by Lenders. If any Lender shall, by exercising any
right of setoff or counterclaim or otherwise, obtain payment in respect of any
principal of or interest on any of the Committed Loans made by it, or the
participations in L/C Obligations or in Swing Line Loans held by it resulting in
such Lender’s receiving payment of a proportion of the aggregate amount of such
Committed Loans or participations and accrued interest thereon greater than its
pro rata share thereof as provided herein, then the Lender receiving such
greater proportion shall (a) notify the Administrative Agent of such fact, and
(b) purchase (for cash at face value) participations in the Committed Loans and
subparticipations in L/C Obligations and Swing Line Loans of the other Lenders,
or make such other adjustments as shall be equitable, 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
Committed Loans and other amounts owing them, provided that:

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

(ii) the provisions of this Section shall not be construed to apply to (x) any
payment made by a Borrower 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), (y) the application of Cash Collateral provided for in
Section 2.17, or (z) any payment obtained by a Lender as consideration for the
assignment of or sale of a participation in any of its Committed Loans or
subparticipations in L/C Obligations or Swing Line Loans to any assignee or
participant, other than to Carpenter or any Subsidiary thereof (as to which the
provisions of this Section shall apply).

Each Borrower consents to the foregoing and agrees, to the extent it may
effectively do so under applicable law, that any Lender acquiring a
participation pursuant to the foregoing arrangements may exercise against such
Borrower rights of setoff and counterclaim with respect to such participation as
fully as if such Lender were a direct creditor of such Borrower in the amount of
such participation.

2.15 Subsidiary Borrowers.

(a) Carpenter may at any time, upon not less than 15 Business Days’ notice from
Carpenter to the Administrative Agent (or such shorter period as may be agreed
by the Administrative Agent in its reasonable discretion), designate any
Subsidiary of Carpenter (an “Applicant Borrower”) as a Subsidiary

 

48

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

Borrower to receive Loans hereunder by delivering to the Administrative Agent
(which shall promptly deliver counterparts thereof to each Lender) a duly
executed notice and agreement in substantially the form of Exhibit G (a
“Subsidiary Borrower Request and Assumption Agreement”). The parties hereto
acknowledge and agree that prior to any Applicant Borrower becoming entitled to
utilize the credit facilities provided for herein the Administrative Agent and
the Lenders shall have received such supporting resolutions, incumbency
certificates, opinions of counsel and other documents or information, in form,
content and scope reasonably satisfactory to the Administrative Agent, as may be
required by the Administrative Agent or the Required Lenders in their sole
discretion, and Notes signed by such new Borrowers to the extent any Lenders so
require. If the Administrative Agent and the Required Lenders agree that an
Applicant Borrower shall be entitled to receive Loans hereunder, then promptly
following receipt of all such requested resolutions, incumbency certificates,
opinions of counsel and other documents or information, the Administrative Agent
shall send a notice in substantially the form of Exhibit H (a “Subsidiary
Borrower Notice”) to Carpenter and the Lenders specifying the effective date
upon which the Applicant Borrower shall constitute a Subsidiary Borrower for
purposes hereof, whereupon each of the Lenders agrees to permit such Subsidiary
Borrower to receive Loans hereunder, on the terms and conditions set forth
herein, and each of the parties agrees that such Subsidiary Borrower otherwise
shall be a Borrower for all purposes of this Agreement; provided that no
Committed Loan Notice or Letter of Credit Application may be submitted by or on
behalf of such Subsidiary Borrower until the date five Business Days after such
effective date; provided further, that effective as of the Closing Date, the
Required Lenders agree that each of the following Subsidiaries may become a
“Subsidiary Borrower” pursuant hereto (subject to satisfaction of the other
conditions set forth in this Section 2.15) without any requirement of further
written consent from the Required Lenders: (i) Carpenter Technology (Europe)
S.A., a company organized and existing under the laws of Belgium, (ii) Carpenter
Technology (UK) Limited, a company organized and existing under the laws of
England and Wales, (iii) Carpenter Powder Products AB, a company organized and
existing under the laws of Sweden and (iv) Carpenter Technology (Canada) Ltd.

(b) The Obligations of Carpenter and each Subsidiary Borrower that is a Domestic
Subsidiary shall be joint and several in nature. The Obligations of all
Subsidiary Borrowers that are Foreign Subsidiaries shall be joint and several in
nature, unless joint liability will result in a material adverse tax consequence
to any Borrower or Subsidiary, in which case, the Obligations of Carpenter that
would otherwise result in such material adverse tax consequence will be several
in nature.

(c) Each Subsidiary of Carpenter that is or becomes a “Subsidiary Borrower”
pursuant to this Section 2.15 hereby irrevocably appoints Carpenter as its agent
for all purposes relevant to this Agreement and each of the other Loan
Documents, including (i) the giving and receipt of notices, (ii) the execution
and delivery of all documents, instruments and certificates contemplated herein
and all modifications hereto, and (iii) the receipt of the proceeds of any Loans
made by the Lenders to any such Subsidiary Borrower hereunder. Any
acknowledgment, consent, direction, certification or other action which might
otherwise be valid or effective only if given or taken by all Borrowers, or by
each Borrower acting singly, shall be valid and effective if given or taken only
by Carpenter, whether or not any such other Borrower joins therein. Any notice,
demand, consent, acknowledgement, direction, certification or other
communication delivered to Carpenter in accordance with the terms of this
Agreement shall be deemed to have been delivered to each Subsidiary Borrower.

(d) Carpenter may from time to time, upon not less than 15 Business Days’ notice
from Carpenter to the Administrative Agent (or such shorter period as may be
agreed by the Administrative Agent in its sole discretion), terminate a
Subsidiary Borrower’s status as such, provided that there are no outstanding
Loans payable by such Subsidiary Borrower, or other amounts payable by such
Subsidiary Borrower on account of any Loans made to it, as of the effective date
of such termination. The Administrative Agent will promptly notify the Lenders
of any such termination of a Subsidiary Borrower’s status.

 

49

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

2.16 Increase in Commitments.

(a) Request for Increase. Provided no Default or Event of Default has occurred
and is continuing, upon notice to the Administrative Agent (which shall promptly
notify the Lenders), Carpenter may from time to time request an increase in the
Aggregate Commitments by an amount (for all such requests) not exceeding
$150,000,000; provided that any such request for an increase shall be in a
minimum amount of $5,000,000. At the time of sending such notice, Carpenter (in
consultation with the Administrative Agent) shall specify the time period within
which each Lender is requested to respond (which shall in no event be less than
ten Business Days from the date of delivery of such notice to the Lenders).

(b) Lender Elections to Increase. Each Lender shall notify the Administrative
Agent within such time period whether or not it agrees to increase its
Commitment and, if so, whether by an amount equal to, greater than, or less than
its Applicable Percentage of such requested increase. Any Lender not responding
within such time period shall be deemed to have declined to increase its
Commitment.

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

(d) Effective Date and Allocations. If the Aggregate Commitments are increased
in accordance with this Section, the Administrative Agent and Carpenter shall
determine the effective date (the “Increase Effective Date”) and the final
allocation of such increase. The Administrative Agent shall promptly notify
Carpenter and the Lenders of the final allocation of such increase and the
Increase Effective Date.

(e) Conditions to Effectiveness of Increase. As a condition precedent to such
increase, Carpenter shall deliver to the Administrative Agent a certificate of
each Borrower dated as of the Increase Effective Date (in sufficient copies for
each Lender) signed by a Responsible Officer of such Borrower (i) certifying and
attaching the resolutions adopted by such Borrower approving or consenting to
such increase, and (ii) in the case of Carpenter, certifying that, before and
after giving effect to such increase, (A) the representations and warranties
contained in Article V and the other Loan Documents are true and correct on and
as of the Increase Effective Date, except to the extent that such
representations and warranties specifically refer to an earlier date, in which
case they are true and correct as of such earlier date, and except that for
purposes of this Section 2.16, the representations and warranties contained in
subsections (a) and (b) of Section 5.05 shall be deemed to refer to the most
recent statements furnished pursuant to clauses (a) and (b), respectively, of
Section 6.01, and (B) no Default exists. The Borrowers shall prepay any
Committed Loans outstanding on the Increase Effective Date (and pay any
additional amounts required pursuant to Section 3.05) to the extent necessary to
keep the outstanding Committed Loans ratable with any revised Applicable
Percentages arising from any nonratable increase in the Commitments under this
Section.

(f) Conflicting Provisions. This Section shall supersede any provisions in
Section 2.14 or 11.01 to the contrary.

 

50

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

2.17 Cash Collateral.

(a) Certain Credit Support Events. Upon the request of the Administrative Agent
or the L/C Issuer (i) if the L/C Issuer has honored any full or partial drawing
request under any Letter of Credit and such drawing has resulted in an L/C
Borrowing, or (ii) if, as of the Letter of Credit Expiration Date, any L/C
Obligation for any reason remains outstanding, Carpenter shall, in each case,
promptly (but in any case within five (5) Business Days) Cash Collateralize the
then Outstanding Amount of all L/C Obligations. At any time that there shall
exist a Defaulting Lender, immediately upon the request of the Administrative
Agent, the L/C Issuer or the Swing Line Lender, Carpenter shall deliver Cash
Collateral to the Administrative Agent in an amount sufficient to cover all
Fronting Exposure (after giving effect to Section 2.18(a)(iv) and any Cash
Collateral provided by the Defaulting Lender).

(b) Grant of Security Interest. All Cash Collateral (other than credit support
not constituting funds subject to deposit) shall be maintained in blocked,
non-interest bearing deposit accounts at Bank of America. Carpenter, and to the
extent provided by any Lender, such Lender, hereby grants to (and subjects to
the control of) the Administrative Agent, for the benefit of the Administrative
Agent, the L/C Issuer and the Lenders (including the Swing Line Lender), and
agrees to maintain, a first priority security interest in all such cash, deposit
accounts and all balances therein, and all other property so provided as
collateral pursuant hereto, and in all proceeds of the foregoing, all as
security for the obligations to which such Cash Collateral may be applied
pursuant to Section 2.17(c). If at any time the Administrative Agent determines
that Cash Collateral is subject to any right or claim of any Person other than
the Administrative Agent as herein provided, or that the total amount of such
Cash Collateral is less than the applicable Fronting Exposure and other
obligations secured thereby, Carpenter or the relevant Defaulting Lender will,
promptly upon demand by the Administrative Agent, pay or provide to the
Administrative Agent additional Cash Collateral in an amount sufficient to
eliminate such deficiency.

(c) Application. Notwithstanding anything to the contrary contained in this
Agreement, Cash Collateral provided under any of this Section 2.17 or Sections
2.04, 2.05, 2.06, 2.18 or 8.02 in respect of Letters of Credit or Swing Line
Loans shall be held and applied to the satisfaction of the specific L/C
Obligations, Swing Line Loans, obligations to fund participations therein
(including, as to Cash Collateral provided by a Defaulting Lender, any interest
accrued on such obligation) and other obligations for which the Cash Collateral
was so provided, prior to any other application of such property as may be
provided for herein.

(d) Release. Cash Collateral (or the appropriate portion thereof) provided to
reduce Fronting Exposure or other obligations shall be released promptly
following (i) the elimination of the applicable Fronting Exposure or other
obligations giving rise thereto (including by the termination of Defaulting
Lender status of the applicable Lender (or, as appropriate, its assignee
following compliance with Section 11.06(b)(vi))) or (ii) the Administrative
Agent’s good faith determination that there exists excess Cash Collateral;
provided that (x) Cash Collateral furnished by or on behalf of Carpenter shall
not be released during the continuance of a Default or Event of Default (and
following application as provided in this Section 2.17 may be otherwise applied
in accordance with Section 8.03), and (y) the Person providing Cash Collateral
and the L/C Issuer or Swing Line Lender, as applicable, may agree that Cash
Collateral shall not be released but instead held to support future anticipated
Fronting Exposure or other obligations.

2.18 Defaulting Lenders.

(a) 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) Waivers and Amendments. 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 11.01.

 

51

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

(ii) Reallocation of Payments. 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, and including any amounts made available to the Administrative Agent
by such Defaulting Lender pursuant to Section 11.08) 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 L/C Issuer or Swing Line
Lender hereunder; third, if so determined by the Administrative Agent or
requested by the L/C Issuer or the Swing Line Lender, to be held as Cash
Collateral for the L/C Issuer’s Fronting Exposure with respect to such
Defaulting Lender; fourth, as Carpenter 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 Carpenter, to be held in a non-interest bearing
deposit account and released 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 L/C Issuer’s future Fronting Exposure with
respect to such Defaulting Lender with respect to future Letters of Credit
issued under this Agreement; sixth, to the payment of any amounts owing to the
Lenders, the L/C Issuer or Swing Line Lender as a result of any judgment of a
court of competent jurisdiction obtained by any Lender, the L/C Issuer or the
Swing Line 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
Carpenter as a result of any judgment of a court of competent jurisdiction
obtained by Carpenter 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 L/C Borrowings in respect of which such Defaulting Lender
has not fully funded its appropriate share, and (y) such Loans or L/C Borrowings
were made or the related Letters of Credit were issued at a time when the
conditions set forth in Section 4.02 were satisfied or waived, such payment
shall be applied solely to pay the Loans of, and L/C Borrowings owed to, all
Non-Defaulting Lenders on a pro rata basis prior to being applied to the payment
of any Loans of, or L/C Borrowings owed to such Defaulting Lender. 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 shall be deemed paid to and redirected by
such Defaulting Lender, and each Lender irrevocably consents hereto.

(iii) Certain Fees. (A) Each Defaulting Lender shall be entitled to receive a
Facility Fee for any period during which that Lender is a Defaulting Lender only
to extent allocable to the sum of (1) the Outstanding Amount of the Committed
Loans funded by it, and (2) its Applicable Percentage of the stated amount of
Letters of Credit and Swing Line Loans for which it has provided Cash Collateral
pursuant to Section 2.04, Section 2.05, Section 2.17, or Section 2.18(a)(ii), as
applicable.

(B) Each Defaulting Lender shall be entitled to receive Letter of Credit Fees
for any period during which that Lender is a Defaulting Lender only to the
extent allocable to its Applicable Percentage of the stated amount of Letters of
Credit for which it has provided Cash Collateral.

 

52

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

(C) With respect to any Facility Fee or Letter of Credit Fee not required to be
paid to any Defaulting Lender pursuant to clause (A) or (B) above, Carpenter
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 L/C Obligations or Swing Line Loans that has been
reallocated to such Non-Defaulting Lender pursuant to clause (iv) below, (y) pay
to the L/C Issuer and Swing Line Lender, as applicable, the amount of any such
fee otherwise payable to such Defaulting Lender to the extent allocable to the
L/C Issuer’s or Swing Line Lender’s Fronting Exposure to such Defaulting Lender,
and (z) not be required to pay the remaining amount of any such fee.

(iv) Reallocation of Participations to Reduce Fronting Exposure. All or any part
of such Defaulting Lender’s participation in L/C Advances and Swing Line Loans
shall be reallocated among the Non-Defaulting Lenders in accordance with their
respective Applicable Percentages (calculated without regard to such Defaulting
Lender’s Commitment) but only to the extent that (x) the conditions set forth in
Section 4.02 are satisfied at the time of such reallocation (and, unless
Carpenter shall have otherwise notified the Administrative Agent at such time,
Carpenter shall be deemed to have represented and warranted that such conditions
are satisfied at such time), and (y) such reallocation does not cause the
aggregate Outstanding Amount of the Committed Loans of any Non-Defaulting
Lender, plus such Non-Defaulting Lender’s Applicable Percentage of the
Outstanding Amount of all L/C Obligations, plus such Non-Defaulting Lender’s
Applicable Percentage of the Outstanding Amount of all Swing Line Loans to
exceed such Non-Defaulting Lender’s Revolving Commitment. 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) Cash Collateral, Repayment of Swing Line Loans. If the reallocation
described in clause (iv) above cannot, or can only partially, be effected,
Carpenter shall, without prejudice to any right or remedy available to it
hereunder or under law, (x) first, prepay Swing Line Loans in an amount equal to
the Swing Line Lender’s Fronting Exposure and (y) second, Cash Collateralize the
L/C Issuer’s Fronting Exposure.

(b) Defaulting Lender Cure. If Carpenter, the Administrative Agent, the Swing
Line Lender and the L/C Issuer agree in writing in their sole discretion that a
Lender is no longer be deemed to be 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 Committed Loans and funded and unfunded
participations in Letters of Credit and Swing Line Loans to be held by the
Lenders in accordance with their Applicable Percentages (without giving effect
to Section 2.18(a)(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 Carpenter 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.

 

53

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

(c) New Swing Line Loans/Letters of Credit. So long as any Lender is a
Defaulting Lender, (i) the Swing Line Lender shall not be required to fund any
Swing Line Loans unless it is satisfied that it will have no Fronting Exposure
after giving effect to such Swing Line Loan and (ii) the L/C Issuer shall not be
required to issue, extend, renew or increase any Letter of Credit unless it is
satisfied that it will have no Fronting Exposure after giving effect thereto.

ARTICLE III

TAXES, YIELD PROTECTION AND ILLEGALITY

3.01 Taxes.

(a) Payments Free of Taxes; Obligation to Withhold; Payments on Account of
Taxes. (i) Any and all payments by or on account of any obligation of the
respective Borrowers hereunder or under any other Loan Document shall to the
extent permitted by applicable Laws be made free and clear of and without
reduction or withholding for any Taxes. If, however, applicable Laws require any
Borrower or the Administrative Agent to withhold or deduct any Tax, such Tax
shall be withheld or deducted in accordance with such Laws as determined by such
Borrower or the Administrative Agent, as the case may be, upon the basis of the
information and documentation to be delivered pursuant to subsection (e) below.

(ii) If any Borrower or the Administrative Agent shall be required by the Code
to withhold or deduct any Taxes, including both United States Federal backup
withholding and withholding taxes, from any payment, then (A) the Administrative
Agent shall withhold or make such deductions as are determined by the
Administrative Agent to be required based upon the information and documentation
it has received pursuant to subsection (e) below, (B) the Administrative Agent
shall timely pay the full amount withheld or deducted to the relevant
Governmental Authority in accordance with the Code, and (C) to the extent that
the withholding or deduction is made on account of Indemnified Taxes or Other
Taxes, the sum payable by such Borrower shall be increased as necessary so that
after any required withholding or the making of all required deductions
(including deductions applicable to additional sums payable under this Section)
the Administrative Agent, Lender or L/C Issuer, as the case may be, receives an
amount equal to the sum it would have received had no such withholding or
deduction been made.

(iii) If any Borrower or the Administrative Agent shall be required by any
applicable Laws other than the Code to withhold or deduct any Taxes from any
payment, then (A) such Borrower or the Administrative Agent, as required by such
Laws, shall withhold or make such deductions as are determined by it to be
required based upon the information and documentation it has received pursuant
to subsection (e) below, (B) such Borrower or the Administrative Agent, to the
extent required by such Laws, shall timely pay the full amount so withheld or
deducted by it to the relevant Governmental Authority in accordance with such
Laws, and (C) to the extent that the withholding or deduction is made on account
of Indemnified Taxes or Other Taxes, the sum payable by such Borrower shall be
increased as necessary so that after any required withholding or the making of
all required deductions (including deductions applicable to additional sums
payable under this Section) the Administrative Agent, Lender or L/C Issuer, as
the case may be, receives an amount equal to the sum it would have received had
no such withholding or deduction been made.

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

 

54

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

(c) Tax Indemnifications. (i) Without limiting the provisions of subsection
(a) or (b) above, each Borrower shall, and does hereby, indemnify the
Administrative Agent, each Lender and the L/C Issuer, and shall make payment in
respect thereof within 20 days after demand therefor, for the full amount of any
Indemnified Taxes or Other Taxes (including Indemnified Taxes or Other Taxes
imposed or asserted on or attributable to amounts payable under this Section)
withheld or deducted by such Borrower or the Administrative Agent or paid by the
Administrative Agent, such Lender or the L/C Issuer, as the case may be, and any
penalties, interest and reasonable expenses arising therefrom or with respect
thereto, whether or not such Indemnified Taxes or Other Taxes were correctly or
legally imposed or asserted by the relevant Governmental Authority. Each
Borrower shall also, and does hereby, indemnify the Administrative Agent, and
shall make payment in respect thereof within 20 days after demand therefor, for
any amount which a Lender or the L/C Issuer for any reason fails to pay
indefeasibly to the Administrative Agent as required by clause (ii) of this
subsection. A certificate as to the amount of any such payment or liability
delivered to a Borrower by a Lender or the L/C Issuer (with a copy to the
Administrative Agent), or by the Administrative Agent on its own behalf or on
behalf of a Lender or the L/C Issuer, shall be conclusive absent manifest error.

(ii) Without limiting the provisions of subsection (a) or (b) above, each Lender
and the L/C Issuer shall, and does hereby, indemnify each Borrower and the
Administrative Agent, and shall make payment in respect thereof within 20 days
after demand therefor, for (A) any Indemnified Taxes attributable to such Lender
(but only to the extent that Carpenter has not already indemnified the
Administrative Agent for such Indemnified Taxes and without limiting the
obligation of Carpenter to do so), (ii) any Taxes attributable to such Lender’s
failure to comply with the provisions of Section 11.06(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 and the L/C Issuer hereby authorizes the Administrative Agent to set
off and apply any and all amounts at any time owing to such Lender or the L/C
Issuer, as the case may be, under this Agreement or any other Loan Document or
otherwise payable by the Administrative Agent to such Lender or the L/C Issuer,
as the case may be, from any other source against any amount due to the
Administrative Agent under this clause (ii). The agreements in this clause
(ii) shall survive the resignation and/or replacement of the Administrative
Agent, any assignment of rights by, or the replacement of, a Lender or the L/C
Issuer, the termination of the Aggregate Commitments and the repayment,
satisfaction or discharge of all other Obligations.

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

(e) Status of Lenders; Tax Documentation. (i) Each Lender shall deliver to
Carpenter and to the Administrative Agent, at the time or times prescribed by
applicable Laws or when reasonably requested by Carpenter or the Administrative
Agent, such properly completed and executed documentation prescribed by
applicable Laws or by the taxing authorities of any jurisdiction and such other
reasonably requested information as will permit Carpenter or the Administrative
Agent, as the case

 

55

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

may be, to determine (A) whether or not payments made by the respective
Borrowers hereunder or under any other Loan Document are subject to Taxes,
(B) if applicable, the required rate of withholding or deduction, and (C) such
Lender’s entitlement to any available exemption from, or reduction of,
applicable Taxes in respect of all payments to be made to such Lender by the
respective Borrowers pursuant to this Agreement or otherwise to establish such
Lender’s status for withholding tax purposes in the applicable jurisdictions.

(ii) Without limiting the generality of the foregoing, if a Borrower is resident
for tax purposes in the United States,

(A) any Lender that is a “United States person” within the meaning of
Section 7701(a)(30) of the Code shall deliver to Carpenter and the
Administrative Agent executed originals of IRS Form W-9 or such other
documentation or information prescribed by applicable Laws or reasonably
requested by Carpenter on behalf of such Borrower or the Administrative Agent as
will enable such Borrower or the Administrative Agent, as the case may be, to
determine whether or not such Lender is subject to backup withholding or
information reporting requirements; and

(B) each Foreign Lender that is entitled under the Code or any applicable treaty
to an exemption from or reduction of withholding tax with respect to payments
hereunder or under any other Loan Document shall deliver to Carpenter and the
Administrative Agent (in such number of copies as shall be requested by the
recipient) on or prior to the date on which such Foreign Lender becomes a Lender
under this Agreement (and from time to time thereafter upon the request of
Carpenter on behalf of such Borrower or the Administrative Agent, but only if
such Foreign Lender is legally entitled to do so), whichever of the following is
applicable:

(I) executed originals of IRS Form W-8BEN claiming eligibility for benefits of
an income tax treaty to which the United States is a party,

(II) executed originals of IRS Form W-8ECI,

(III) executed originals of IRS Form W-8IMY and all required supporting
documentation,

(IV) in the case of a Foreign Lender claiming the benefits of the exemption for
portfolio interest under section 871(h) or 881(c) of the Code, (x) a certificate
to the effect that such Foreign Lender is not (A) a “bank” within the meaning of
section 881(c)(3)(A) of the Code, (B) a “10 percent shareholder” of such
Borrower within the meaning of section 881(c)(3)(B) of the Code, or (C) a
“controlled foreign corporation” described in section 881(c)(3)(C) of the Code
and (y) executed originals of IRS Form W-8BEN, or

(V) executed originals of any other form prescribed by applicable Laws as a
basis for claiming exemption from or a reduction in United States Federal
withholding tax together with such supplementary documentation as may be
prescribed by applicable Laws to permit such Borrower or the Administrative
Agent to determine the withholding or deduction required to be made.

(iii) Each Lender shall promptly (A) notify Carpenter and the Administrative
Agent of any change in circumstances which would modify or render invalid any
claimed exemption or

 

56

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

reduction, and (B) take such steps as shall not be materially disadvantageous to
it, in the reasonable judgment of such Lender, and as may be reasonably
necessary (including the re-designation of its Lending Office) to avoid any
requirement of applicable Laws of any jurisdiction that any Borrower or the
Administrative Agent make any withholding or deduction for taxes from amounts
payable to such Lender.

(iv) Each of the Borrowers shall promptly deliver to the Administrative Agent or
any Lender, as the Administrative Agent or such Lender shall reasonably request,
on or prior to the Closing Date (or such later date on which it first becomes a
Borrower), and in a timely fashion thereafter, such documents and forms required
by any relevant taxing authorities under the Laws of any jurisdiction, duly
executed and completed by such Borrower, as are required to be furnished by such
Lender or the Administrative Agent under such Laws in connection with any
payment by the Administrative Agent or any Lender of Taxes or Other Taxes, or
otherwise in connection with the Loan Documents, with respect to such
jurisdiction.

(f) Treatment of Certain Refunds. Unless required by applicable Laws, at no time
shall the Administrative Agent have any obligation to file for or otherwise
pursue on behalf of a Lender or the L/C Issuer, or have any obligation to pay to
any Lender or the L/C Issuer, any refund of Taxes withheld or deducted from
funds paid for the account of such Lender or the L/C Issuer, as the case may be.
If the Administrative Agent, any Lender or the L/C Issuer determines, in its
sole discretion, that it has received a refund of any Taxes or Other Taxes as to
which it has been indemnified by any Borrower or with respect to which any
Borrower has paid additional amounts pursuant to this Section, it shall pay to
such Borrower an amount equal to such refund (but only to the extent of
indemnity payments made, or additional amounts paid, by such Borrower under this
Section with respect to the Taxes or Other Taxes giving rise to such refund),
net of all out-of-pocket expenses and net of any loss or gain realized in the
conversion of such funds from or to another currency incurred by the
Administrative Agent, such Lender or the L/C Issuer, as the case may be, and
without interest (other than any interest paid by the relevant Governmental
Authority with respect to such refund), provided that each Borrower, upon the
request of the Administrative Agent, such Lender or the L/C Issuer, agrees to
repay the amount paid over to such Borrower (plus any penalties, interest or
other charges imposed by the relevant Governmental Authority) to the
Administrative Agent, such Lender or the L/C Issuer in the event the
Administrative Agent, such Lender or the L/C Issuer is required to repay such
refund to such Governmental Authority. This subsection shall not be construed to
require the Administrative Agent, any Lender or the L/C Issuer to make available
its tax returns (or any other information relating to its taxes that it deems
confidential) to any Borrower or any other Person.

3.02 Illegality. If any Lender determines that any Law has made it unlawful, or
that any Governmental Authority has asserted that it is unlawful, for any Lender
or its applicable Lending Office to make, maintain or fund Eurocurrency Rate
Loans (whether denominated in Dollars or an Alternative Currency), or to
determine or charge interest rates based upon the Eurocurrency Rate, or any
Governmental Authority has imposed material restrictions on the authority of
such Lender to purchase or sell, or to take deposits of, Dollars or any
Alternative Currency in the applicable interbank market, then, on notice thereof
by such Lender to Carpenter through the Administrative Agent, any obligation of
such Lender to make or continue Eurocurrency Rate Loans in the affected currency
or currencies or, in the case of Eurocurrency Rate Loans in Dollars, to convert
Base Rate Committed Loans to Eurocurrency Rate Loans or, if such notice relates
to the unlawfulness or asserted unlawfulness of charging interest based on the
Eurocurrency Base Rate, to make Base Rate Loans as to which the interest rate is
determined with reference to the Eurocurrency Base Rate, shall be suspended
until such Lender notifies the Administrative Agent and Carpenter that the
circumstances giving rise to such determination no longer exist. Upon receipt of
such notice, the Borrowers shall, upon demand from such Lender (with a copy to
the Administrative Agent), prepay or, if applicable and such Loans are
denominated in Dollars, convert all

 

57

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

such Eurocurrency Rate Loans of such Lender and Base Rate Loans as to which the
interest rate is determined with reference to the Eurocurrency Base Rate to Base
Rate Loans as to which the rate of interest is not determined with reference to
the Eurocurrency Base Rate, to Base Rate Loans, either on the last day of the
Interest Period therefor, if such Lender may lawfully continue to maintain such
Eurocurrency Rate Loans to such day, or immediately, if such Lender may not
lawfully continue to maintain such Eurocurrency Rate Loans or a Base Rate Loan
as to which the interest rate is determined with reference to the Eurocurrency
Base Rate. Upon any such prepayment or conversion, the Borrowers shall also pay
accrued interest on the amount so prepaid or converted.

3.03 Inability to Determine Rates. If the Required Lenders determine that for
any reason in connection with any request for a Eurocurrency Rate Loan or a Base
Rate Loan as to which the interest rate is determined with reference to the
Eurocurrency Base Rate or a conversion to or continuation thereof that
(a) deposits (whether in Dollars or an Alternative Currency) are not being
offered to banks in the applicable offshore interbank market for such currency
for the applicable amount and Interest Period of such Eurocurrency Rate Loan,
(b) adequate and reasonable means do not exist for determining the Eurocurrency
Base Rate for any requested Interest Period with respect to a proposed
Eurocurrency Rate Loan (whether denominated in Dollars or an Alternative
Currency) or in connection with a Base Rate Loan, or (c) the Eurocurrency Base
Rate for any requested Interest Period with respect to a proposed Eurocurrency
Rate Loan or in connection with a Base Rate Loan does not adequately and fairly
reflect the cost to such Lenders of funding such Eurocurrency Rate Loan, the
Administrative Agent will promptly so notify Carpenter and each Lender.
Thereafter, the obligation of the Lenders to make or maintain Eurocurrency Rate
Loans in the affected currency or currencies, and Base Rate Loan as to which the
interest rate is determined with reference to the Eurocurrency Base Rate shall
be suspended until the Administrative Agent (upon the instruction of the
Required Lenders) revokes such notice and during such period Base Rate Loans
shall be made and continued based on the interest rate determined by the greater
of clauses (a) and (b) in the definition of Base Rate. Upon receipt of such
notice, Carpenter may revoke any pending request for a Borrowing of, conversion
to or continuation of Eurocurrency Rate Loans in the affected currency or
currencies or, failing that, will be deemed to have converted such request into
a request for a Committed Borrowing of Base Rate Loans in the amount specified
therein.

3.04 Increased Costs.

(a) Increased Costs Generally. If any Change in Law shall:

(i) impose, modify or deem applicable any reserve, special deposit, compulsory
loan, insurance charge or similar requirement against assets of, deposits with
or for the account of, or credit extended or participated in by, any Lender
(except (A) any reserve requirement reflected in the Eurocurrency Rate and
(B) the requirements of the Bank of England and the Financial Services Authority
or the European Central Bank reflected in the Mandatory Cost, other than as set
forth below) or the L/C Issuer;

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

(iii) result in the failure of the Mandatory Cost, as calculated hereunder, to
represent the cost to any Lender of complying with the requirements of the Bank
of England and/or the Financial Services Authority or the European Central Bank
in relation to its making, funding or maintaining Eurocurrency Rate Loans; or

 

58

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

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

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

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

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

(d) Delay in Requests. Failure or delay on the part of any Lender or the L/C
Issuer to demand compensation pursuant to the foregoing provisions of this
Section shall not constitute a waiver of such Lender’s or the L/C Issuer’s right
to demand such compensation; provided that no Borrower shall be required to
compensate a Lender or the L/C Issuer pursuant to the foregoing provisions of
this Section for any increased costs incurred or reductions suffered more than
nine months prior to the date that such Lender or the L/C Issuer, as the case
may be, notifies Carpenter of the Change in Law giving rise to such increased
costs or reductions and of such Lender’s or the L/C Issuer’s intention to claim
compensation therefor (except that, if the Change in Law giving rise to such
increased costs or reductions is retroactive, then the nine-month period
referred to above shall be extended to include the period of retroactive effect
thereof).

(e) Additional Reserve Requirements. Carpenter shall pay (or cause the
applicable Subsidiary Borrower to pay) to each Lender, as long as such Lender
shall be required to comply with any

 

59

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

reserve ratio requirement or analogous requirement of any central banking or
financial regulatory authority imposed in respect of the maintenance of the
Commitments or the funding of the Eurocurrency Rate Loans, such additional costs
(expressed as a percentage per annum and rounded upwards, if necessary, to the
nearest five decimal places) equal to the actual costs allocated to such
Commitment or Loan by such Lender (as determined by such Lender in good faith,
which determination shall be conclusive), which in each case shall be due and
payable on each date on which interest is payable on such Loan, provided
Carpenter shall have received at least 10 days’ prior notice (with a copy to the
Administrative Agent) of such additional interest or costs from such Lender. If
a Lender fails to give notice 10 days prior to the relevant Interest Payment
Date, such additional interest or costs shall be due and payable 10 days from
receipt of such notice.

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

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

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

(c) any failure by any Borrower to make payment of any Loan or drawing under any
Letter of Credit (or interest due thereon) denominated in an Alternative
Currency on its scheduled due date or any payment thereof in a different
currency; or

(d) any assignment of a Eurocurrency Rate Loan on a day other than the last day
of the Interest Period therefor as a result of a request by Carpenter pursuant
to Section 11.13;

including any loss of anticipated profits, any foreign exchange losses and any
loss or expense arising from the liquidation or reemployment of funds obtained
by it to maintain such Loan, from fees payable to terminate the deposits from
which such funds were obtained or from the performance of any foreign exchange
contract. Carpenter shall also pay (or cause the applicable Subsidiary Borrower
to pay) any customary administrative fees charged by such Lender in connection
with the foregoing.

For purposes of calculating amounts payable by Carpenter (or the applicable
Subsidiary Borrower) to the Lenders under this Section 3.05, each Lender shall
be deemed to have funded each Eurocurrency Rate Loan made by it at the
Eurocurrency Base Rate used in determining the Eurocurrency Rate for such Loan
by a matching deposit or other borrowing in the offshore interbank market for
such currency for a comparable amount and for a comparable period, whether or
not such Eurocurrency Rate Loan was in fact so funded.

3.06 Mitigation Obligations; Replacement of Lenders.

(a) Designation of a Different Lending Office. If any Lender requests
compensation under Section 3.04, or any Borrower is required to pay any
additional amount to any Lender, the L/C Issuer, or any Governmental Authority
for the account of any Lender or the L/C Issuer pursuant to Section 3.01, then
such Lender or the L/C Issuer shall (at the request of Carpenter) use reasonable
efforts to designate a different Lending Office for funding or booking its Loans
hereunder or to assign its rights and obligations

 

60

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

hereunder to another of its offices, branches or affiliates, if, in the judgment
of such Lender or the L/C Issuer, such designation or assignment (i) would
eliminate or reduce amounts payable pursuant to Section 3.01 or 3.04, as the
case may be, in the future and (ii) in each case, would not subject such Lender
or the L/C Issuer, as the case may be, to any unreimbursed cost or expense and
would not otherwise be disadvantageous to such Lender or the L/C Issuer, as the
case may be. Carpenter hereby agrees to pay (or to cause the applicable
Subsidiary Borrower to pay) all reasonable costs and expenses incurred by any
Lender or the L/C Issuer in connection with any such designation or assignment.

(b) Replacement of Lenders. If any Lender requests compensation under
Section 3.04, 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 3.01, such Borrower may replace such Lender in accordance with
Section 11.13.

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

ARTICLE IV

CONDITIONS PRECEDENT TO CREDIT EXTENSIONS

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

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

(i) executed counterparts of this Agreement;

(ii) Notes executed by the Borrowers in favor of each Lender requesting a Note;

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

(iv) such documents and certifications as the Administrative Agent may
reasonably require to evidence that each of the Borrowers is (A) duly organized
or formed and (B) validly existing, in good standing and qualified to engage in
business in each jurisdiction where its ownership, lease or operation of
properties or the conduct of its business requires such qualification, except to
the extent that failure to do so could not reasonably be expected to have a
Material Adverse Effect;

(v) a favorable opinion of counsel to the Borrowers, addressed to the
Administrative Agent and each Lender (which opinion shall expressly permit
reliance by permitted successors and assigns of the addressees thereof);

 

61

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

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

(vii) a certificate signed by a Responsible Officer of Carpenter certifying
(A) that the conditions specified in Sections 4.02(a) and (b) have been
satisfied, (B) that there has been no event or circumstance since December 31,
2010 that has had or could be reasonably expected to have, either individually
or in the aggregate, a Material Adverse Effect; and (C) the current Debt
Ratings;

(viii) a duly completed Compliance Certificate as of the last day of the fiscal
quarter of Carpenter ended March 31, 2011, signed by a Responsible Officer of
Carpenter, together with the consolidated balance sheet of Carpenter and its
Consolidated Subsidiaries as of the fiscal quarter ended March 31, 2011,
together with related consolidated statements of operations and retained
earnings and cash flows for such fiscal quarter and the then elapsed portion of
such fiscal year;

(ix) evidence that the Existing Credit Agreement has been, or concurrently with
the Closing Date is being, terminated and all obligations (other than the
Existing Letters of Credit) thereunder have been or, concurrently with the
Closing Date are being, paid in full; and

(x) such other assurances, certificates, documents, consents or opinions as the
Administrative Agent, the L/C Issuer, the Swing Line Lender or the Required
Lenders reasonably may require.

(b) Any fees required to be paid on or before the Closing Date shall have been
paid (including, without limitation, all fees to be paid pursuant to
Section 2.10(b)) to the Administrative Agent, the Arrangers and the Lenders and
any other accrued and unpaid fees or commissions due hereunder.

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

Without limiting the generality of the provisions of the last paragraph of
Section 9.03, for purposes of determining compliance with the conditions
specified in this Section 4.01, each Lender that has signed this Agreement shall
be deemed to have consented to, approved or accepted or to be satisfied with,
each document or other matter required thereunder to be consented to or approved
by or acceptable or satisfactory to a Lender unless the Administrative Agent
shall have received notice from such Lender prior to the proposed Closing Date
specifying its objection thereto.

 

62

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

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

(a) The representations and warranties of (i) the Borrowers contained in Article
V and (ii) each Borrower contained in each other Loan Document or in any
document furnished at any time under or in connection herewith or therewith,
shall be true and correct in all material respects (unless such representation
and warranty is subject to a materiality or Material Adverse Effect qualifier in
which case it will be true and correct in all respects) on and as of the date of
such Credit Extension, except to the extent that such representations and
warranties specifically refer to an earlier date, in which case they shall be
true and correct as of such earlier date, and except that for purposes of this
Section 4.02, the representations and warranties contained in subsections
(a) and (b) of Section 5.05 shall be deemed to refer to the most recent
statements furnished pursuant to clauses (a) and (b), respectively, of
Section 6.01.

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

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

(d) If the applicable Borrower is a Subsidiary Borrower, then the conditions of
Section 2.15 to the designation of such Borrower as a Subsidiary Borrower shall
have been met to the satisfaction of the Administrative Agent.

(e) In the case of a Credit Extension to be denominated in an Alternative
Currency, the fact that no Lender shall have notified the Administrative Agent
(which shall promptly notify the applicable Borrower and the other Lenders)
within two Business Days of such Lender’s receipt of the Committed Loan Notice
for such Borrowing that deposits in the relevant currency are not available to
such Lender in the applicable interbank market for the relevant Interest Period
and there shall not have occurred any change in national or international
financial, political or economic conditions or currency exchange rates or
exchange controls which in the reasonable opinion of the Administrative Agent,
the Required Lenders (in the case of any Loans to be denominated in an
Alternative Currency) or the L/C Issuer (in the case of any Letter of Credit to
be denominated in an Alternative Currency) would make it impracticable for such
Credit Extension to be denominated in the relevant Alternative Currency.

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

ARTICLE V

REPRESENTATIONS AND WARRANTIES

The Borrowers represent and warrant to the Administrative Agent, the L/C Issuer
and the Lenders that:

5.01 Existence, Qualification and Power; Compliance with Laws. The Borrowers and
their respective Subsidiaries (a) are corporations or other entities duly
organized, validly existing and in good standing under the Laws of the
jurisdiction of their respective incorporation or organization, (b) have all
requisite power and authority and all governmental licenses, authorizations,
consents and approvals (i) to own or lease their respective assets and carry on
their respective business and (ii) to execute, deliver, and perform their
respective obligations under the Loan Documents to which they are a party,
(c) are duly qualified and licensed and are in good standing under the Laws of
each jurisdiction where their ownership, lease or operation of properties or the
conduct of their respective businesses require such qualification or license and
(d) are in compliance with all Laws, except in each case referred to in clause
(b)(i), (c) and this clause (d), to the extent that failure to do so could not
reasonably be expected to have a Material Adverse Effect.

 

63

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

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

5.03 Governmental and Other Authorizations. No approval, consent, exemption,
authorization, or other action by, or notice to, or filing with, any
Governmental Authority or any other Person is necessary or required in
connection with the execution, delivery or performance by, or enforcement
against, any Borrower of this Agreement or any other Loan Document, which has
not been obtained.

5.04 Binding Effect. This Agreement has been, and each other Loan Document, when
delivered hereunder, will have been, duly executed and delivered by each
Borrower that is party thereto. This Agreement constitutes, and each other Loan
Document to which any Borrower is a party when executed and delivered will
constitute, a legal, valid and binding obligation of such Borrower enforceable
against such Borrower in accordance with its terms, except as enforceability may
be limited by applicable bankruptcy, insolvency, reorganization, moratorium or
similar Laws affecting the enforcement of creditors’ rights generally and by
equitable principles of general applicability (regardless of whether enforcement
is sought by proceedings in equity or at law).

5.05 Financial Condition.

(a) Annual Financial Statements. The consolidated balance sheet of Carpenter and
its Consolidated Subsidiaries as of June 30, 2010 and the related consolidated
statements of income and cash flows for the fiscal year then ended, reported on
by PricewaterhouseCoopers and set forth in Carpenter’s 2010 Form 10–K, fairly
present in all material respects, in conformity with GAAP, the consolidated
financial position of Carpenter and its Consolidated Subsidiaries as of such
date and their consolidated results of operations and cash flows for such fiscal
year.

(b) Interim Financial Statements. The unaudited consolidated balance sheet of
Carpenter and its Consolidated Subsidiaries as of March 31, 2011 and the related
unaudited consolidated statements of income and cash flows for the three months
then ended, set forth in Carpenter’s Latest Form 10–Q, fairly present in all
material respects, in conformity with GAAP applied on a basis consistent with
the financial statements referred to in Section 5.05(a), the consolidated
financial position of Carpenter and its Consolidated Subsidiaries as of such
date and their consolidated results of operations and cash flows for such
three–month period (subject to normal year–end audit adjustments and the absence
of footnotes required under GAAP).

(c) Material Adverse Effect. Since December 31, 2010, there has been no Material
Adverse Effect, and no event or development has occurred which could reasonably
be expected to result in a Material Adverse Effect.

(d) Post-Closing Financial Statements. The financial statements delivered to the
Lenders pursuant to Section 6.01(a) and (b), if any, (i) have been and will be
prepared in accordance with GAAP

 

64

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

(except as may otherwise be permitted under Section 6.01(a) and (b)) and
(ii) present fairly in all material respects (on the basis disclosed in the
footnotes to such financial statements, if any) the consolidated financial
condition, results of operations and cash flows of Carpenter and its
Consolidated Subsidiaries as of the respective dates thereof and for the
respective periods covered thereby.

(e) Disclosure of Liabilities and Obligations. Except as fully reflected in the
financial statements referred to in Section 5.05(a), (b) and (d) and the notes
thereto, there are no material liabilities or obligations with respect to
Carpenter or any of its Consolidated Subsidiaries of any nature whatsoever that
are required in accordance with GAAP to be reflected in such financial
statements and that are not so reflected.

5.06 Litigation. There are no actions, suits, investigations or legal,
equitable, arbitration or administrative proceedings pending or, to the
knowledge of any Borrower, threatened against or affecting Carpenter or any of
its Subsidiaries or against any of their properties or revenues that (a) purport
to affect or pertain to any Loan Document or (b) if determined adversely, could
reasonably be expected, individually or in the aggregate, to result in a
Material Adverse Effect.

5.07 No Default. Neither Carpenter nor any Subsidiary is in default in any
respect under any Contractual Obligation which default could reasonably be
expected to have a Material Adverse Effect. No Default or Event of Default has
occurred or exists or would result from the consummation of the transactions
contemplated by this Agreement and the other Loan Documents.

5.08 Ownership of Property; Liens. Carpenter and each Subsidiary has good record
and marketable title in fee simple to, or valid leasehold interests in, all real
property necessary in the ordinary conduct of its business, except for such
defects in title as would not, individually or in the aggregate, have a Material
Adverse Effect. As of the Closing Date, the property of Carpenter and its
Subsidiaries is subject to no Liens, other than Liens permitted by Section 7.02.

5.09 Environmental Compliance. Carpenter and its Subsidiaries conduct in the
ordinary course of business a review of the effect of existing Environmental
Laws and claims alleging potential liability or responsibility for violation of
any Environmental Law on their respective businesses, operations and properties,
and as a result thereof each Borrower has reasonably concluded that such
Environmental Laws and claims would not, individually or in the aggregate, have
a Material Adverse Effect.

5.10 Insurance. The properties of Carpenter and its Subsidiaries are insured
with financially sound and reputable insurance companies not Affiliates of
Carpenter, 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 Carpenter or its Subsidiaries operate.

5.11 Taxes. Carpenter and its Subsidiaries have filed all Federal, state,
material local, material foreign and other material tax returns and reports
required to be filed, and have paid all Federal, state, material local, material
foreign and other material taxes, assessments, fees and other governmental
charges levied or imposed upon them or their properties, income or assets
otherwise due and payable, except those which are being contested in good faith
by appropriate proceedings and for which adequate reserves have been provided in
accordance with GAAP. There is no proposed tax assessment against Carpenter or
any Subsidiary that would, if made, have a Material Adverse Effect. Neither any
Borrower or any Subsidiary thereof is party to any tax sharing agreement other
than such an agreement by and between Carpenter and/or its Subsidiaries.

 

65

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

5.12 ERISA and Foreign Benefit Plan Compliance.

(a) Except as would not have a Material Adverse Effect, each Pension Plan (but
only to the knowledge of Carpenter or any ERISA Affiliate with respect to any
Multiemployer Plan) is in compliance in all material respects with the
applicable provisions of ERISA, the Code and other Federal or state Laws. Each
Pension Plan that is intended to qualify under Section 401(a) of the Code has
received a favorable determination letter from the IRS to the effect that the
form of such Plan is qualified under Section 401(a) of the Code and the trust
related thereto has been determined by the IRS to be exempt from federal income
tax under Section 501(a) of the Code or an application for such a letter is
currently being processed by the IRS with respect thereto and, to the knowledge
of Carpenter, nothing has occurred which would prevent, or cause the loss of,
such qualification and which would result in a Material Adverse Effect. Except
as would not have a Material Adverse Effect, (i) Carpenter and each ERISA
Affiliate have made all required contributions to each Plan subject to
Section 412 of the Code, and (ii) no application for a funding waiver or an
extension of any amortization period pursuant to Section 412 of the Code has
been made with respect to any Plan.

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

(c) Except as would not result in a Material Adverse Effect, (i) no ERISA Event
has occurred, and neither Carpenter nor any ERISA Affiliate is aware of any
fact, event or circumstance that could reasonably be expected to constitute or
result in an ERISA Event with respect to any Pension Plan; (ii) neither
Carpenter nor any ERISA Affiliate has incurred, or reasonably expects to incur,
any liability to the PBGC other than for the payment of premiums, and there are
no premium payments which have become due that are unpaid; (iii) Carpenter and
each ERISA Affiliate have met all applicable requirements under the Pension
Funding Rules in respect of each Pension Plan, and no waiver of the minimum
funding standards under the Pension Funding Rules has been applied for or
obtained; (iv) as of the most recent valuation date for any Pension Plan, the
funding target attainment percentage (as defined in Section 430(d)(2) of the
Code) is 60% or higher and neither Carpenter nor any ERISA Affiliate knows of
any facts or circumstances that could reasonably be expected to cause the
funding target attainment percentage for any such plan to drop below 60% as of
the most recent valuation date; (v) neither Carpenter nor any ERISA Affiliate
has engaged in a transaction that could be subject to Section 4069 or
Section 4212(c) of ERISA; and (vi) no Pension Plan has been terminated by the
plan administrator thereof nor by the PBGC, and no event or circumstance has
occurred or exists that could reasonably be expected to cause the PBGC to
institute proceedings under Title IV of ERISA to terminate any Pension Plan.

(d) With respect to any Foreign Benefit Plan, (i) each Foreign Benefit Plan is
in compliance with applicable Law except as would not result in a Material
Adverse Effect or to the extent set forth in subparagraph (ii), (ii) the
aggregate of the accumulated benefit obligations under all Foreign Benefit Plans
does not exceed the current fair market value of the assets held in the trust or
similar funding vehicles for such Foreign Benefit Plans in an amount in excess
of $20,000,000, and (iii) reasonable reserves have been established in
accordance with prudent business practice or where required by ordinary
accounting practices in the jurisdiction in which each material Foreign Benefit
Plan is maintained. There are no actions, suits or claims (other than routine
claims for benefits) pending, or the knowledge of Carpenter, threatened against
it or any of the Borrowers or any of their respective Subsidiaries with respect
to any Foreign Benefit Plan, except as would not result in a Material Adverse
Effect.

5.13 Subsidiaries. Schedule 5.13 sets forth a complete and accurate list as of
the Closing Date of all Subsidiaries of Carpenter. Schedule 5.13 sets forth as
of the Closing Date the jurisdiction of formation of each such Subsidiary, the
number of outstanding shares of each class of Equity Interests, the

 

66

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

number and percentage of outstanding shares of each class of Equity Interests of
each such Subsidiary owned (directly or indirectly) by any Person and the number
and effect, if exercised, of all Equity Equivalents with respect to Equity
Interests of each such Subsidiary. The true and correct U.S. taxpayer
identification number of Carpenter and each Subsidiary Borrower that is a
Domestic Subsidiary and a party hereto on the Closing Date is set forth on
Schedule 5.13. The true and correct unique identification number of each
Subsidiary Borrower that is a Foreign Subsidiary and a party hereto on the
Closing Date that has been issued by its jurisdiction of organization and the
name of such jurisdiction are set forth on Schedule 5.13.

5.14 Margin Regulation; Investment Company Act.

(a) None of Carpenter and 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” within the meaning of Regulation U. No
part of the Letters of Credit or proceeds of the Loans will be used, directly,
or indirectly, for the purpose of purchasing or carrying any “margin stock”
within the meaning of Regulation U. Following the application of the proceeds of
each Borrowing or drawing under each Letter of Credit, not more than 25% of the
value of the assets (either of the applicable Borrower only or of such Borrower
and its Subsidiaries on a consolidated basis) subject to the provisions of
Section 7.02 or Section 7.05 or subject to any restriction contained in any
agreement or instrument between any Borrower and any Lender or any Affiliate of
any Lender relating to Indebtedness and within the scope of Section 8.01(f) will
be margin stock. None of the transactions contemplated by this Agreement
(including the direct or indirect use of the proceeds of the Loans) will violate
or result in a violation of the Securities Act, the Exchange Act or regulations
issued pursuant thereto, or Regulations T, U or X.

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

5.15 Disclosure. No statement, information, report, representation, or warranty
made by any Borrower in any Loan Document or furnished to the Administrative
Agent or any Lender by or on behalf of any Borrower in connection with any Loan
Document contains any untrue statement of a material fact or omits any material
fact required to be stated therein or necessary to make the statements therein,
in light of the circumstances under which they were made, not misleading.

5.16 Intellectual Property. Carpenter and its Subsidiaries own, or possess the
right to use, all of the trademarks, service marks, trade names, copyrights,
patents, patent rights, franchises, licenses, trade secrets (including
unpatented proprietary or confidential information, systems or procedures
protected as trade secrets) and other intellectual property rights
(collectively, “Intellectual Property”) that are reasonably necessary for the
operation of their respective businesses, without conflict with the rights of
any other Person, except where the failure to own or possess the right to use
any such Intellectual Property would not reasonably be expected to have a
Material Adverse Effect. To the knowledge of any Borrower, no slogan or other
advertising device, product, process, method, substance, part or other material
now employed, or now contemplated to be employed, by Carpenter or any Subsidiary
infringes upon any rights held by any other Person, except where such
infringement would not reasonably be expected to have a Material Adverse Effect.
No claim or litigation regarding any of the foregoing is pending or, to the
knowledge of any Borrower, threatened, and no patent, invention, device,
application, principle or any Law is pending or, to the knowledge of any
Borrower, proposed, which, in either case, could reasonably be expected to have
a Material Adverse Effect.

5.17 Compliance with Laws. Each Borrower and each Subsidiary thereof is in
compliance in all material respects with the requirements of all Laws and all
orders, writs, injunctions and decrees applicable to it or to its properties,
except in such instances in which (a) such requirement of Law or

 

67

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

order, writ, injunction or decree is being contested in good faith by
appropriate proceedings diligently conducted or (b) the failure to comply
therewith, either individually or in the aggregate, could not reasonably be
expected to have a Material Adverse Effect.

5.18 Representations as to Foreign Obligors. Each Foreign Obligor represents and
warrants to the Administrative Agent and the Lenders that:

(a) Such Foreign Obligor is subject to civil and commercial Laws with respect to
its obligations under this Agreement and the other Loan Documents to which it is
a party (collectively as to such Foreign Obligor, the “Applicable Foreign
Obligor Documents”), and the execution, delivery and performance by such Foreign
Obligor of the Applicable Foreign Obligor Documents constitute and will
constitute private and commercial acts and not public or governmental acts.
Neither such Foreign Obligor nor any of its property has any immunity from
jurisdiction of any court or from any legal process (whether through service or
notice, attachment prior to judgment, attachment in aid of execution, execution
or otherwise) under the Laws of the jurisdiction in which such Foreign Obligor
is organized and existing in respect of its obligations under the Applicable
Foreign Obligor Documents.

(b) The Applicable Foreign Obligor Documents are in proper legal form under the
Laws of the jurisdiction in which such Foreign Obligor is organized and existing
for the enforcement thereof against such Foreign Obligor under the Laws of such
jurisdiction, and to ensure the legality, validity, enforceability, priority or
admissibility in evidence of the Applicable Foreign Obligor Documents. It is not
necessary to ensure the legality, validity, enforceability, priority or
admissibility in evidence of the Applicable Foreign Obligor Documents that the
Applicable Foreign Obligor Documents be filed, registered or recorded with, or
executed or notarized before, any court or other authority in the jurisdiction
in which such Foreign Obligor is organized and existing or that any registration
charge or stamp or similar tax be paid on or in respect of the Applicable
Foreign Obligor Documents or any other document.

(c) There is no material tax, levy, impost, duty, fee, assessment or other
governmental charge, or any deduction or withholding, imposed by any
Governmental Authority in or of the jurisdiction in which such Foreign Obligor
is organized and existing either (i) on or by virtue of the execution or
delivery of the Applicable Foreign Obligor Documents or (ii) on any payment to
be made by such Foreign Obligor pursuant to the Applicable Foreign Obligor
Documents.

(d) The execution, delivery and performance of the Applicable Foreign Obligor
Documents executed by such Foreign Obligor are, under applicable foreign
exchange control regulations of the jurisdiction in which such Foreign Obligor
is incorporated or organized and existing, not subject to any notification or
authorization except such as have been made or obtained.

5.19 OFAC; Anti-Terrorism Laws.

(a) No Borrower is a Sanctioned Person or does business in a Sanctioned Country
or with a Sanctioned Person, in each case in violation of the economic sanctions
of the United States administered by OFAC.

(b) Neither the making of the Loans hereunder nor the use of the proceeds
thereof will violate the Patriot Act, the Trading with the Enemy Act, as
amended, or any of the foreign assets control regulations of the United States
Treasury Department (31 CFR, Subtitle B, Chapter V, as amended) or any enabling
legislation or executive order relating thereto. The Borrowers and their
Subsidiaries are in compliance in all material respects with the PATRIOT Act.

 

68

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

ARTICLE VI

AFFIRMATIVE COVENANTS

The Borrowers agree that so long as any Lender has any Commitment hereunder, any
Obligation or other amount payable hereunder or under any Note or other Loan
Document or any L/C Obligation remains unpaid or any Letter of Credit remains
unexpired:

6.01 Information. Carpenter will furnish, or cause to be furnished, to the
Administrative Agent, and the Administrative Agent will furnish each of the
Lenders:

(a) Annual Financial Statements. As soon as available and in any event within 90
days (or, if earlier and if applicable to Carpenter, the annual report deadline
under the Exchange Act rules and regulations) after the end of each fiscal year
of Carpenter, a consolidated balance sheet and income statement of Carpenter and
its Consolidated Subsidiaries, as of the end of such fiscal year, and the
related consolidated statements of operations and retained earnings and cash
flows for such fiscal year, setting forth in comparative form consolidated
figures for the preceding fiscal year, all such financial statements to be in
reasonable form and detail and audited by independent certified public
accountants of recognized national standing reasonably acceptable to the
Administrative Agent and accompanied by an opinion of such accountants (which
shall not be subject to any qualifications or exceptions as to the scope of the
audit nor to any qualifications or exceptions not reasonably acceptable to the
Required Lenders) to the effect that such consolidated financial statements have
been prepared in accordance with GAAP and present fairly the consolidated
financial position and consolidated results of operations and cash flows of
Carpenter and its Consolidated Subsidiaries in accordance with GAAP consistently
applied (except for changes with which such accountants concur).

(b) Quarterly Financial Statements. As soon as available, and in any event
within 45 days (or, if earlier and if applicable to Carpenter, the quarterly
report deadline under the Exchange Act rules and regulations) after the end of
each of the first three fiscal quarters in each fiscal year of Carpenter, a
consolidated balance sheet of Carpenter and its Consolidated Subsidiaries as of
the end of such fiscal quarter, together with related consolidated statements of
operations and retained earnings and cash flows for such fiscal quarter and the
then elapsed portion of such fiscal year, setting forth in comparative form
consolidated figures for the corresponding periods of the preceding fiscal year,
all such financial statements to be in form and detail and reasonably acceptable
to the Administrative Agent, and accompanied by a certificate of the chief
financial officer of Carpenter to the effect that such quarterly financial
statements have been prepared in accordance with GAAP and present fairly in all
material respects the consolidated financial position and consolidated results
of operations and cash flows of Carpenter and its Consolidated Subsidiaries in
accordance with GAAP consistently applied, subject to changes resulting from
normal year–end audit adjustments and the absence of footnotes required by GAAP.

(c) Compliance Certificate. At the time of delivery of the financial statements
provided for in Sections 6.01(a) and 6.01(b) above, a duly completed compliance
certificate signed by the chief executive officer, chief financial officer,
treasurer or controller of Carpenter, substantially in the form of Exhibit E
(the “Compliance Certificate”) (i) demonstrating compliance with the financial
covenants contained in Section 7.12 by calculation thereof as of the end of the
fiscal period covered by such financial statements, (ii) stating that no Default
or Event of Default exists, or if any Default or Event of Default does exist,
specifying the nature and extent thereof and what action Carpenter proposes to
take with respect thereto, and (iii) stating whether, since the date of the most
recent financial statements delivered hereunder, there has been any material
change in GAAP as applied in the preparation of the financial statements of
Carpenter and its Consolidated Subsidiaries, and, if so, describing such change.

 

69

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

(d) Reports. Promptly after the same are filed or made available, copies, which
may be in electronic format, of each annual report, proxy or financial statement
or other report or communication sent to the stockholders of Carpenter, and
copies of all annual, regular, periodic and special reports and registration
statements which Carpenter may file or be required to file with the SEC under
Section 13 or 15(d) of the Exchange Act, and not otherwise required to be
delivered to the Administrative Agent pursuant hereto.

(e) Notices. Prompt notice, after obtaining knowledge thereof, of: (i) the
occurrence of any Default or Event of Default; (ii) any matter that has resulted
or may result in a Material Adverse Effect, including (A) breach or
non–performance of, or any default under, a Contractual Obligation of Carpenter
or any Subsidiary, which could reasonably be expected to have a Material Adverse
Effect; (B) any dispute, litigation, investigation, proceeding or suspension
between Carpenter or any Subsidiary and of Governmental Authority, which could
reasonably be expected to have a Material Adverse Effect; (C) the commencement
of, or any material development in, any litigation or proceeding affecting
Carpenter or any Subsidiary, including pursuant to any applicable Environmental
Law, which could reasonably be expected to have a Material Adverse Effect;
(D) any litigation, investigation or proceeding affecting any Borrower in which
the amount involved exceeds $5,000,000, or in which injunctive relief or similar
relief is sought, which relief, if granted, could be reasonably expected to have
a Material Adverse Effect; (E) the occurrence of any ERISA Event, which could
reasonably be expected to have a Material Adverse Effect; (F) any material
change in accounting policies or financial reporting practice by Carpenter or
any Subsidiary; and (G) of any announcement by Moody’s or S&P of any change in
either Debt Rating. Each notice pursuant to this Section 6.01(e) shall (i) be
accompanied by a statement of a Responsible Officer of Carpenter setting forth
details of the occurrence referred to therein and stating what action Carpenter
has taken and proposes to take with respect thereto and (ii) describe with
particularity any and all provisions of this Agreement or other Loan Document
that have been breached.

(f) Annual Business Plan and Budget. Prior to the 30th day after the beginning
of each fiscal year of Carpenter (commencing with the fiscal year beginning
July 1, 2012), an annual business plan and budget of Carpenter and its
Consolidated Subsidiaries.

(g) Other Information. With reasonable promptness upon request therefor, such
other information regarding the business, properties or financial condition of
Carpenter or any Subsidiary as the Administrative Agent or the Required Lenders
may reasonably request.

(h) Lender Communications. Documents required to be delivered pursuant to
Section 6.01(a), (b) or (d) (to the extent any such documents are included in
materials otherwise filed with the SEC) may be delivered electronically and if
so delivered, shall be deemed to have been delivered on the date (i) on which
Carpenter posts such documents, or provides a link thereto on Carpenter’s
website on the Internet at the website address listed on Schedule 11.02; or
(ii) on which such documents are posted on Carpenter’s behalf on an Internet or
intranet website, if any, to which each Lender and the Administrative Agent have
access (whether a commercial, third-party website or whether sponsored by the
Administrative Agent); provided that: (i) Carpenter shall deliver paper copies
of such documents to the Administrative Agent or any Lender that requests
Carpenter to deliver such paper copies until a written request to cease
delivering paper copies is given by the Administrative Agent or such Lender and
(ii) Carpenter shall notify the Administrative Agent and each Lender (by
telecopier or electronic mail) of the posting of any such documents and provide
to the Administrative Agent by electronic mail electronic versions (i.e., soft
copies) of such documents. Notwithstanding anything contained herein, in every
instance Carpenter shall be required to provide a paper copy of the Compliance
Certificates required by Section 6.01(c) to the Administrative Agent. Except for
such Compliance Certificates, the Administrative Agent shall have no obligation
to request the delivery or to maintain copies of the documents referred to
above, and in any event shall have no responsibility to monitor compliance by
Carpenter with any such request for delivery, and each Lender shall be solely
responsible for requesting delivery to it or maintaining its copies of such
documents.

 

70

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

Each Borrower hereby acknowledges that (a) the Administrative Agent and/or the
Arranger will make available to the Lenders and the L/C Issuer materials and/or
information provided by or on behalf of such Borrower hereunder (collectively,
“Borrower Materials”) by posting the Borrower Materials on IntraLinks or another
similar electronic system (the “Platform”) and (b) certain of the Lenders (each,
a “Public Lender”) may have personnel who do not wish to receive material
non-public information with respect to any of the Borrowers or their respective
Affiliates, or the respective securities of any of the foregoing, and who may be
engaged in investment and other market-related activities with respect to such
Persons’ securities. Each Borrower hereby agrees that (w) all Borrower Materials
that are to be made available to Public Lenders shall be clearly and
conspicuously marked “PUBLIC” which, at a minimum, shall mean that the word
“PUBLIC” shall appear prominently on the first page thereof; (x) by marking
Borrower Materials “PUBLIC,” the Borrowers shall be deemed to have authorized
the Administrative Agent, the Arranger, the L/C Issuer and the Lenders to treat
such Borrower Materials as not containing any material non-public information
with respect to the Borrowers or their respective securities for purposes of
United States Federal and state securities laws (provided, however, that to the
extent such Borrower Materials constitute Information, they shall be treated as
set forth in Section 11.07); (y) all Borrower Materials marked “PUBLIC” are
permitted to be made available through a portion of the Platform designated
“Public Side Information;” and (z) the Administrative Agent and the Arranger
shall be entitled to treat any Borrower Materials that are not marked “PUBLIC”
as being suitable only for posting on a portion of the Platform not designated
“Public Side Information.” Notwithstanding the foregoing, no Borrower shall be
under any obligation to mark any Borrower Materials “PUBLIC.”

6.02 Payment of Obligations. Carpenter will, and will cause each of its
Subsidiaries to, pay and discharge as the same shall become due and payable
(after giving effect to all applicable grace and cure periods), all its
obligations and liabilities which if not paid and discharged could reasonably be
expected to have a Material Adverse Effect, including: (a) all tax liabilities,
assessments and governmental charges or levies upon it or its properties or
assets, unless the same are being contested in good faith by appropriate
proceedings and adequate reserves in accordance with GAAP are being maintained
by Carpenter or such Subsidiary; and (b) all lawful claims which, if unpaid,
would by Law become a Lien (other than a Permitted Lien) upon its property.

6.03 Preservation of Existence, Etc. Carpenter will, and will cause each of its
Subsidiaries to, preserve, renew and maintain in full force and effect its legal
existence and good standing under the Laws of the jurisdiction of its
organization; take all reasonable action to maintain all rights, privileges,
permits licenses and franchises necessary in the normal conduct of its business,
except in a transaction permitted by Section 7.04 or 7.05 and except where
failure to do so could not reasonably be expected to have a Material Adverse
Effect; and preserve or renew all of its registered patents, trademarks, trade
names and service marks, the non–preservation or non–maintenance of which could
reasonably be expected to have a Material Adverse Effect.

6.04 Maintenance of Properties. Carpenter will, and will cause each of its
Subsidiaries to, (a) subject to the provisions of clause (b) of this
Section 6.04, maintain, preserve and protect all of its material properties and
equipment necessary in the operation of its business in good working order and
condition, ordinary wear and tear and casualty excepted; and (b) make all
necessary repairs thereto and renewals and replacements thereof except where the
failure to do so could not reasonably be expected to have a Material Adverse
Effect.

6.05 Maintenance of Insurance. Carpenter will, and will cause each of its
Subsidiaries to, maintain with financially sound and reputable insurance
companies not Affiliates of Carpenter, insurance

 

71

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

with respect to its properties and business against loss or damage of the kinds
customarily insured against by Persons engaged in the same or similar business,
of such types and in such amounts as are customarily carried under similar
circumstances by such other Persons.

6.06 Compliance with Laws. Carpenter will, and will cause each of its
Subsidiaries to, comply in all material respects with the requirements of all
Laws and all orders, writs, injunctions and decrees applicable to it or to its
business or property, except in such instances in which (a) such requirement of
Law or order, writ, injunction or decree is being contested in good faith or a
bona fide dispute exists with respect thereto or (b) the failure to comply
therewith could not be reasonably expected to have a Material Adverse Effect.

6.07 Books and Records. Carpenter will, and will cause each of its Subsidiaries
to, maintain proper books of record and account, in which full, true and correct
entries in conformity with GAAP shall be made of all financial transactions and
matters involving the assets and business of Carpenter or such Subsidiary, as
the case may be; and maintain such books of record and account in material
conformity with all applicable requirements of any Governmental Authority having
regulatory jurisdiction over Carpenter or such Subsidiary, as the case may be.

6.08 Inspection Rights. Carpenter will, and will cause each of its Subsidiaries
to, permit representatives and independent contractors of the Administrative
Agent and each Lender to visit and inspect any of its properties, to examine its
corporate, financial and operating records, and make copies thereof or abstracts
therefrom, and to discuss its affairs, finances and accounts with its directors,
officers, and independent public accountants, at such reasonable times during
normal business hours and as often as may be reasonably desired, upon reasonable
advance notice to Carpenter all at the expense of Carpenter (provided that
Carpenter shall only be obligated to reimburse the Administrative Agent and
Lenders for such expense in connection with one such visit per fiscal year so
long as no Event of Default then exists); provided, however, that when an Event
of Default exists, the Administrative Agent or any Lender (or any of their
respective representatives or independent contractors) may do any of the
foregoing at the expense of Carpenter at any time during normal business hours
and without advance notice.

6.09 Compliance with ERISA. Except as would not have a Material Adverse Effect,
Carpenter will, and will cause each of its ERISA Affiliates to, (a) maintain
each Plan (other than any Multiemployer Plan) in compliance in all material
respects with the applicable provisions of ERISA, the Code and other Federal or
state Law; (b) cause each Pension Plan which is qualified under Section 401(a)
of the Code to maintain such qualification; and (c) make all required
contributions to any Plan subject to Section 412 of the Code.

6.10 Use of Proceeds. Each Borrower will use the proceeds of the Credit
Extensions (a) to repay or refinance, as applicable, certain Indebtedness of the
Borrowers (including, without limitation, Indebtedness under the Existing Credit
Agreement) in accordance with the terms hereof and pay any fees, commissions and
expenses incurred in connection with the foregoing and (b) for working capital,
capital expenditures and other lawful general corporate purposes not in
contravention of any Law or of any Loan Document, including, without limitation,
making Investments permitted by this Agreement.

6.11 OFAC; PATRIOT Act Compliance. Each Borrower will, and will cause each of
its Subsidiaries to, (a) refrain from doing business in a Sanctioned Country or
with a Sanctioned Person, in each case in violation of the economic sanctions of
the United States administered by OFAC, and (b) provide, to the extent
commercially reasonable, such information and take such actions as are
reasonably requested by the Administrative Agent or any Lender in order to
assist the Administrative Agent and the Lenders in maintaining compliance with
the PATRIOT Act.

 

72

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

ARTICLE VII

NEGATIVE COVENANTS

Each Borrower agrees that so long as any Lender has any Commitment hereunder,
any Obligation or other amount payable hereunder or under any Note or other Loan
Document or any L/C Obligation remains unpaid or any Letter of Credit remains
unexpired:

7.01 Limitation on Indebtedness. Carpenter will not, nor will it cause or permit
any Subsidiary to, directly or indirectly, incur, create, assume or permit to
exist any Indebtedness except:

(a) Indebtedness of Carpenter and its Subsidiaries outstanding on the Closing
Date and disclosed on Schedule 7.01 and any extensions, renewals or refinancings
thereof; provided that (i) the amount of such Indebtedness is not increased at
the time of such refinancing, refunding, renewal or extension except by an
amount equal to a reasonable premium or other reasonable amount paid, and fees
and expenses reasonably incurred, in connection with such refinancing and by an
amount equal to any existing commitments unutilized thereunder and (ii) the
terms relating to principal amount, amortization, maturity, collateral (if any)
and subordination (if any), and other material terms taken as a whole, of any
such refinancing, refunding, renewing or extending Indebtedness, and of any
agreement entered into and of any instrument issued in connection therewith, are
no less favorable in any material respect to the Borrowers or the Lenders than
the terms of any agreement or instrument governing the Indebtedness being
refinanced, refunded, renewed or extended and the interest rate applicable to
any such extending, renewing or refinancing Indebtedness does not exceed the
then applicable market interest rate;

(b) Indebtedness of the Borrowers under this Agreement and the other Loan
Documents;

(c) Indebtedness incurred by Carpenter in connection with the issuance of
unsecured senior notes in an aggregate principal amount of up to $300,000,000
(the “Senior Notes”) under that certain indenture dated as of January 12, 1994
between Carpenter and U.S. Bank National Association, as successor trustee to
Morgan Guaranty Trust Company of New York and U.S. Bank Trust National
Association; provided that (i) the net proceeds of such Senior Notes (x) shall
be used to repay in full at their stated maturity all Indebtedness of Carpenter
and its Subsidiaries under Carpenter’s existing Medium-Term Notes, Series C at
7.625% due August 2011 (the “Existing Senior Notes”) and such Existing Senior
Notes shall be terminated (and any Liens and security interests granted in
connection therewith shall be released) immediately upon repayment of such
Existing Senior Notes, and (y) shall otherwise be used for general corporate
purposes of Carpenter and its Subsidiaries, including, without limitation,
making Investments permitted by this Agreement, (ii) the Indebtedness evidenced
by such Senior Notes shall rank pari passu or junior in right of payment to the
Obligations, and (iii) the stated maturity date of the Senior Notes shall be at
least six (6) months after the Maturity Date;

(d) Indebtedness of Carpenter and its Subsidiaries not otherwise permitted by
this Section 7.01 incurred after the Closing Date in an aggregate principal
amount not to exceed $400,000,000 at any time outstanding; provided that (i) up
to $30,000,000 aggregate principal amount of such Indebtedness may be secured,
(ii) no Default or Event of Default shall have occurred and be continuing
immediately before and immediately after giving effect to such incurrence and
(iii) upon giving effect on a pro–forma basis to the incurrence of such
Indebtedness and to the concurrent retirement of any other Indebtedness of
Carpenter or any Subsidiary, Carpenter shall be in compliance with the financial
covenants set forth in Section 7.12;

(e) Purchase Money Indebtedness of Carpenter and its Subsidiaries incurred after
the Closing Date; provided that (i) such Indebtedness is issued and any Liens
securing such Indebtedness are created concurrently with, or within 90 days
after, the acquisition of the asset financed and (ii) such Indebtedness does not
exceed the cost of the property being acquired on the date of the acquisition,
plus any related costs of the acquisition or financing of such property; and

 

73

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

(f) Indebtedness of (i) Carpenter owed to any Subsidiary of Carpenter, and
(ii) any Subsidiary of Carpenter owed to Carpenter or any other Subsidiary of
Carpenter, in each case to the extent such Indebtedness is permitted under the
provisions of Section 7.03.

7.02 Restriction on Liens. Carpenter will not, and will not cause or permit any
of its Subsidiaries to, create, incur, assume or permit to exist any Lien on any
property or assets (including Equity Interests or other securities of any
Person, including any Subsidiary of Carpenter) now owned or hereafter acquired
by it or on any income or rights in respect thereof, except Liens described in
any of the following clauses (collectively, the “Permitted Liens”):

(a) Liens existing on the Closing Date and listed on Schedule 7.02 hereto,
provided that such Liens shall secure only those obligations which they secure
on the date hereof (and permitted extensions, renewals and refinancings of such
obligations) and shall not subsequently apply to any other property or assets of
Carpenter and its Subsidiaries (other than accessions to and the proceeds of the
property or assets subject to such Liens to the extent provided by the terms
thereof on the date hereof);

(b) existing and future Liens (other than any Liens imposed by ERISA or pursuant
to any Environmental Law) for taxes, assessments or governmental charges or
levies (i) which are not yet due or as to which the grace period (not to exceed
30 days) has not yet expired or (ii) being contested in good faith and by
appropriate proceedings diligently pursued for which adequate reserves (in the
good faith judgment of the management of Carpenter) have been established in
accordance with GAAP (and as to which the property or assets subject to any such
Lien is not yet subject to foreclosure, sale or loss on account thereof);

(c) existing and future Liens imposed by Law securing the charges, claims,
demands or levies of landlords, carriers, warehousemen, mechanics, carriers and
other like persons which were incurred in the ordinary course of business and
which (i) do not, individually or in the aggregate, materially detract from the
value of the property or assets which are material to the business of Carpenter
or any of its Subsidiaries and which are the subject of such Lien or materially
impair the use thereof in the operation of the business of Carpenter or any of
its Subsidiaries or (ii) which are being contested in good faith by appropriate
proceedings diligently pursued, which proceedings have the effect of preventing
the forfeiture or sale of the property or assets subject to such Lien;

(d) Liens arising from judgments, decrees or attachments (or securing of appeal
bonds with respect thereto) in circumstances not constituting an Event of
Default under Section 8.01;

(e) existing and future Liens (other than any Liens imposed by ERISA or pursuant
to any Environmental Law) incurred or deposits made in the ordinary course of
business in connection with workers’ compensation, unemployment insurance and
other types of social security or to secure the performance of tenders,
statutory obligations, surety bonds (other than appeal bonds), bids, leases,
government contracts, performance and return–of–money bonds and other similar
obligations incurred in the ordinary course of business;

(f) existing and future zoning restrictions, easements, rights of way, licenses,
reservations, covenants, conditions, waivers, restrictions on the use of
property or other minor encumbrances or irregularities of title not securing
Indebtedness which do not, individually or in the aggregate, materially impair
the use of any property in the operation or business of Carpenter or any of its
Subsidiaries or the value of such property for the purpose of such business;

 

74

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

(g) Liens securing (i) the secured Indebtedness permitted to be incurred under
Section 7.01(d)(i) and (ii) Purchase Money Indebtedness permitted to be incurred
under Section 7.01(e); provided that, with respect to clause (ii), such Lien
does not at any time encumber any property other than the property financed by
such Indebtedness (except for the products or proceeds of the assets subject to
such Liens to the extent provided by the terms thereof at the time such Liens
are granted);

(h) any Lien existing on any asset of any Person at the time such Person becomes
a Subsidiary of Carpenter; provided that (i) such Liens were not created in
contemplation of such event and (ii) such Liens do not extend to any assets
other than those affected thereby prior to such event (except for the products
or proceeds of the assets subject to such Liens to the extent provided by the
terms thereof on the date of such event);

(i) any Lien on any asset of any Person existing at the time such Person is
merged or consolidated with or into Carpenter or a Subsidiary of Carpenter;
provided that (i) such Liens were not created in contemplation of such event and
(ii) such Liens do not extend to any assets other than those affected thereby
prior to such event (except for the products or proceeds of the assets subject
to such Liens to the extent provided by the terms thereof on the date of such
event);

(j) any Lien existing on any asset prior to the acquisition thereof by Carpenter
or a Subsidiary of Carpenter; provided that (i) such Liens were not created in
contemplation of such event and (ii) such Liens do not extend to any assets
other than those affected thereby prior to such event (except for the products
or proceeds of the assets subject to such Liens to the extent provided by the
terms thereof on the date of such event);

(k) existing and future Liens arising solely by virtue of any statutory or
common law provision relating to banker’s liens, rights of set–off or similar
rights, in each case incurred in the ordinary course of business;

(l) any provision of Cash Collateral pursuant to the terms hereof;

(m) Liens arising from precautionary uniform commercial code financing
statements filed under any lease permitted by this Agreement;

(n) Liens arising out of conditional sale, title retention, consignment or
similar arrangements entered into by Carpenter or any of its Subsidiaries in the
ordinary course of business; and

(o) Liens other than those permitted by clause (a) through clause (n) of this
Section 7.02 on property or assets of Carpenter and its Subsidiaries now owned
or hereafter acquired by it, or on any income or rights in respect thereof, not
in excess of fifteen percent (15%) of Consolidated Tangible Net Worth.

7.03 Investments. Carpenter will not, and will not cause or permit any of its
Subsidiaries to, make or acquire, any Investment in any Person, except the
following (such Investments described below being herein referred to as
“Permitted Investments”):

(a) Investments other than those permitted by Sections 7.03(b) through
(i) existing on the date hereof and listed on Part I of Schedule 7.03;

(b) Investments held by Carpenter or such Subsidiary in the form of Cash
Equivalents and Eligible Investments;

 

75

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

(c) advances to officers, directors and employees of Carpenter and Subsidiaries
in an aggregate amount not to exceed $2,000,000 at any time outstanding, for
travel, entertainment, relocation and analogous ordinary business purposes;

(d) Investments of Carpenter, or of any Subsidiary thereof, in Carpenter or any
Wholly-Owned Subsidiary thereof;

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

(f) Investments permitted by Section 7.04;

(g) Investments consisting of the acquisition by Carpenter or any of is
Subsidiaries of assets or Equity Interests of any other Person; provided, that
(i) no Default or Event of Default shall have occurred and be continuing,
(ii) the Person whose assets or Equity Interests are acquired pursuant to this
clause (g) shall be engaged in substantially the same or related line of
business as Carpenter and its Subsidiaries are engaged in as of the Closing Date
and (iii) after giving effect to any such acquisition, Carpenter shall be in pro
forma compliance with the covenants set forth in Section 7.12 of this Agreement;

(h) Investments in joint ventures and other non wholly-owned entities
(i) existing on the date hereof and listed on Part II of Schedule 7.03 and
(ii) made after the date hereof in an aggregate amount (excluding any such
Investments permitted pursuant to Section 7.03(h)(i)) not to exceed twenty-five
percent (25%) of Consolidated Tangible Net Worth;

(i) Investments of a Subsidiary acquired after the Closing Date or of a Person
merged into Carpenter or merged or consolidated with a Subsidiary of Carpenter
in accordance with Section 7.04 after the Closing Date to the extent that such
Investments were not made in contemplation of or in connection with such
acquisition, merger or consolidation or were in existence on the date of such
acquisition, merger or consolidation; and

(j) Investments, other than those permitted by clause (a) through clause (i) of
this Section 7.03, made in the ordinary course of business and consistent with
past practices of Carpenter and its Subsidiaries.

7.04 Fundamental Changes. Carpenter will not, and will not cause or permit any
of its Subsidiaries to, merge, consolidate with or into, or convey, transfer,
lease or otherwise dispose of (whether in one transaction or in a series of
transactions) all or substantially all of its assets (whether now owned or
hereafter acquired) to or in favor of any Person, except that, so long as no
Default or Event of Default exists or would result therefrom:

(a) any Subsidiary of a Borrower may merge or consolidate with (i) such Borrower
or Carpenter, provided that such Borrower shall be the continuing or surviving
Person, or in the case of a merger or consolidation involving Carpenter,
Carpenter shall be the continuing or surviving Person, or (ii) any one or more
Subsidiaries (other than a Borrower) of such Borrower; provided that when any
Wholly-Owned Subsidiary is merging or consolidating with another Subsidiary, the
Wholly-Owned Subsidiary shall be the continuing or surviving Person;

 

76

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

(b) any Subsidiary of a Borrower may convey, transfer, lease or otherwise
dispose of all or substantially all of its assets (upon voluntary liquidation or
otherwise), to such Borrower or Carpenter or to another Subsidiary (other than a
Borrower) of such Borrower; provided that if the transferor in such a
transaction is a Wholly–Owned Subsidiary, then the transferee must also be a
Wholly–Owned Subsidiary;

(c) any Person may merge or consolidate with Carpenter or any of its
Subsidiaries in connection with an Investment pursuant to Section 7.03(g);
provided that a Subsidiary of Carpenter shall be the continuing or surviving
Person, or in the case of a merger or consolidation involving Carpenter,
Carpenter shall be the continuing or surviving Person; and

(d) any Subsidiary of Carpenter may dissolve or liquidate at any time if
Carpenter determines in good faith that such dissolution or liquidation is not
materially disadvantageous to the Lenders and so long as the relevant Person
complies with the provisions of Section 7.04(b).

7.05 Dispositions. Carpenter will not, and will not cause or permit any of its
Subsidiaries to, make any Disposition or enter into any agreement to make any
Disposition, except:

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

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

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

(d) Dispositions of property by Carpenter or any Subsidiary of Carpenter (i) to
Carpenter or to a Wholly–Owned Subsidiary of Carpenter or (ii) to a joint
venture or to a non Wholly-Owned Subsidiary of Carpenter to the extent
constituting an Investment permitted by Section 7.03(h);

(e) Dispositions permitted by Section 7.04;

(f) Dispositions of Cash Equivalents and Eligible Investments in the ordinary
course of business;

(g) the sale, assignment, transfer, Disposition, discount or forgiveness of
accounts receivable in the ordinary course of business or in connection with the
collection or compromise thereof; and

(h) in addition to the Dispositions permitted by clause (a) through clause
(g) of this Section 7.05, Dispositions of property of Carpenter or any
Subsidiary, including Equity Interests of any Subsidiary; provided that such
Dispositions consummated during the term of this Agreement in the aggregate do
not exceed twenty-five percent (25%) of the total assets of Carpenter and its
Subsidiaries; provided further that to the extent the property subject to any
such Disposition represents more than five percent (5%) of the total assets of
Carpenter and its Subsidiaries, (i) no Default or Event of Default shall have
occurred and be continuing and (ii) after giving effect to each such
Disposition, Carpenter shall be in pro forma compliance with the covenants set
forth in Section 7.12 of this Agreement;

provided, however, that any Disposition pursuant to clauses (a) through (h) of
property having a book value in excess of $25,000,000 shall be for fair market
value.

 

77

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

7.06 Restricted Payments. Carpenter will not, and will not cause or permit any
of its Subsidiaries to, declare or make, directly or indirectly, any Restricted
Payment, or incur any obligation (contingent or otherwise) to do so, except
that:

(a) each Subsidiary may make Restricted Payments to Carpenter and to
Wholly–Owned Subsidiaries (and, in the case of a Restricted Payment by a
non–Wholly–Owned Subsidiary, to Carpenter and any Subsidiary and to each other
owner of Equity Interests of such Subsidiary on a pro–rata basis based on their
relative ownership interests);

(b) Carpenter and each Subsidiary may declare and make dividend payments or
other distributions payable solely in the Equity Interests (exclusive of
Disqualified Stock) of such Person;

(c) Carpenter and each Subsidiary may purchase, redeem or otherwise acquire
shares of its Equity Interests (exclusive of Disqualified Stock); provided that,
(i) any such purchase, redemption or other acquisition for value shall not have
a Material Adverse Effect and (ii) immediately prior to and after giving effect
to any such proposed action, no Default or Event of Default shall have occurred
and be continuing; and

(d) Carpenter may declare or pay cash dividends to its stockholders; provided
that, (i) any such declaration or payment shall not have a Material Adverse
Effect and (ii) both prior to and immediately after giving effect to any such
proposed action, no Default or Event of Default shall have occurred and be
continuing.

7.07 ERISA. Carpenter will not, nor will it cause or permit any Subsidiary or
ERISA Affiliate to, at any time engage in a transaction which could be subject
to Section 4069 or 4212(c) of ERISA, or permit any (a) Pension Plan (other than
a Multiemployer Plan) to engage in any non–exempt “prohibited transaction” (as
defined in Section 4975 of the Code); (b) Pension Plan (other than a
Multiemployer Plan) to fail to comply with ERISA or any other applicable Laws;
or (c) Pension Plan (other than a Multiemployer Plan) to fail to satisfy any
“minimum funding standard” (as defined in Section 302 of ERISA), which, with
respect to each event listed above, could be reasonably expected to have a
Material Adverse Effect.

7.08 Change in Nature of Business. Carpenter will not, nor will it cause or
permit any Subsidiary to, at any time, engage in any material line of business
substantially different from those lines of business conducted by Carpenter and
its Subsidiaries on the Closing Date.

7.09 Transactions with Affiliates. Carpenter will not, nor will it cause or
permit any of its Subsidiaries to, enter into any transaction of any kind with
any Affiliate of Carpenter, other than arm’s–length transactions with Affiliates
that are otherwise permitted hereunder, provided that the foregoing restrictions
shall not apply to transactions between or among Carpenter and any of its
Wholly–Owned Subsidiaries or between and among any Wholly–Owned Subsidiaries.

7.10 Burdensome Agreements. Carpenter will not, nor will it cause or permit any
of its Subsidiaries to, enter into any Contractual Obligation that limits the
ability (a) of any Subsidiary to make Restricted Payments to Carpenter, (b) of
any Subsidiary to otherwise transfer property to Carpenter or (c) of Carpenter
or any Subsidiary to create, incur, assume or suffer to exist Liens on property
of such Person (other than, (i) with respect to clause (a), (A) any agreement or
instrument of a Person acquired by Carpenter or any of its Subsidiaries as in
effect at the time of such acquisition (except to the extent such agreement or
instrument was entered into or created in connection with or in contemplation of
such acquisition), which limitation is not applicable to any Person or the
properties or assets of any Person, other than the Person or the property or
assets of the Person so acquired, (B) any agreement for the sale or

 

78

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

other Disposition of assets, to the extent such sale is permitted pursuant to
Section 7.05, that contains customary restrictions pending its sale or other
Disposition, including restrictions on distributions by a Subsidiary pending its
sale or other Disposition, and (C) customary restrictions found in joint venture
agreements entered into in connection with Investments permitted pursuant to
Section 7.03(h), and (ii) with respect to clauses (b) and (c), (A) Contractual
Obligations entered into in connection with Permitted Liens, (B) customary
non-assignment provisions in leases, licenses and other contracts otherwise
permitted by this Agreement and entered into in the ordinary course of business
so long as such restrictions relate only to the assets subject thereto, (C) any
agreement or instrument of a Person acquired by Carpenter or any of its
Subsidiaries as in effect at the time of such acquisition (except to the extent
such agreement or instrument was entered into or created in connection with or
in contemplation of such acquisition), which limitation is not applicable to any
Person or the properties or assets of any Person, other than the Person or the
property or assets of the Person, so acquired, (D) any agreement for the sale or
other Disposition of assets, to the extent such sale or Disposition is permitted
pursuant to Section 7.05, that contains customary restrictions pending its sale
or other Disposition, including restrictions on distributions by a Subsidiary
pending its sale or other Disposition and (E) customary restrictions found in
joint venture agreements entered into in connection with Investments permitted
pursuant to Section 7.03(h).

7.11 Use of Proceeds. Carpenter will not, nor will it cause or permit any of its
Subsidiaries to, use the proceeds of any Credit Extension, whether directly or
indirectly, and whether immediately, incidentally or ultimately, to purchase or
carry margin stock (within the meaning of Regulation U of the FRB) or to extend
credit to others for the purpose of purchasing or carrying margin stock or to
refund indebtedness originally incurred for such purpose.

7.12 Financial Covenants.

(a) Interest Coverage Ratio. The Interest Coverage Ratio for any period of four
consecutive fiscal quarters of Carpenter, in each case taken as a single
accounting period, shall not be less than the ratio set forth below opposite
such fiscal quarter:

 

Four Fiscal Quarters Ending

  

Minimum Interest Coverage Ratio

Closing Date through

September 30, 2011

   3.25 to 1.00 December 31, 2011 and thereafter    3.50 to 1.00

(b) Debt to Capital Ratio. The Debt to Capital Ratio shall not exceed 55% as of
the last day of any fiscal quarter of Carpenter.

ARTICLE VIII

EVENTS OF DEFAULT AND REMEDIES

8.01 Events of Default. An Event of Default shall exist upon the occurrence of
any of the following specified events or conditions (each an “Event of
Default”):

(a) Payment. Any Borrower shall fail to pay: (i) as and when due and in the
currency required hereunder (whether by scheduled maturity, mandatory
prepayment, acceleration or otherwise) any amount of principal of any Loan or
any L/C Obligation; (ii) within three Business Days of when due (whether by
scheduled maturity, mandatory prepayment, acceleration or otherwise) any
interest on any Committed Loan or L/C Obligation, or any fee due hereunder; or
(iii) within five Business Days after the same become due, any other amount
payable hereunder or under any other Loan Document.

 

79

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

(b) Representation and Warranties. Any representation, warranty or statement
made or deemed to be made by any Borrower herein, in any of the other Loan
Documents or in any statement or certificate delivered or required to be
delivered pursuant hereto or thereto shall prove untrue in any material respect
on the date as of which it was made or deemed to have been made.

(c) Covenants. Any Borrower shall:

(i) default in the due performance or observance of any term, covenant or
agreement contained in Sections 6.01, 6.02, 6.03 (but solely as it relates to
legal existence in its jurisdiction of organization), 6.05 or 6.10, or in
Article VII or Article X; or

(ii) default in the due performance or observance by it of any term, covenant or
agreement (other than those referred to in Sections 8.01(a), (b) or (c)(i))
contained in this Agreement and such default shall continue unremedied for a
period of at least 30 days after the earlier of an executive officer of such
Borrower becoming aware of such default or notice thereof given by the
Administrative Agent.

(d) Other Loan Documents. Any Borrower shall default in the due performance or
observance of any term, covenant or agreement in any of the other Loan Documents
and such default shall continue unremedied for a period of at least 30 days
after the earlier of an executive officer of such Borrower becoming aware of
such default or notice thereof given by the Administrative Agent.

(e) Bankruptcy, etc. A Bankruptcy Event shall occur with respect to Carpenter or
any of its Subsidiaries.

(f) Cross-Default. Carpenter or any Subsidiary (i) fails to make payment when
due (whether by scheduled maturity, required prepayment, acceleration, demand or
otherwise), in respect of any Indebtedness or Guarantee (other than in respect
of Indebtedness outstanding under the Loan Documents) having an aggregate
principal amount (including undrawn committed or available amounts and including
amounts owing to all creditors under any combined or syndicated credit
arrangement) of more than $20,000,000, (ii) fails to perform or observe any
other condition or covenant, or any other event shall occur or condition shall
exist, under any agreement or instrument relating to any such Indebtedness or
Guarantee, if the effect of such failure, event or condition is to cause or
permit such Indebtedness to be declared to be due and payable prior to its
stated maturity, or such Guarantee to become payable, or cash collateral in
respect thereof to be demanded or (iii) shall be required by the terms of such
Indebtedness or Guarantee to offer to prepay or repurchase such Indebtedness or
the primary Indebtedness underlying such Guarantee (or any portion thereof)
prior to the stated maturity thereof.

(g) Judgments. One or more judgments, orders, decrees or arbitration awards is
entered against Carpenter or any Subsidiary involving in the aggregate a
liability (to the extent not covered by independent third–party insurance as to
which the insurer does not dispute coverage), as to any single or related series
of transactions, incidents or conditions, of $20,000,000 or more, and the same
shall remain undischarged, unvacated and unstayed pending appeal for a period of
30 days after the entry thereof, or any non–monetary judgment, order or decree
is entered against Carpenter or such Subsidiary which has or would reasonably be
expected to have a Material Adverse Effect, and there shall be any 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.

 

80

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

(h) ERISA. (i) An ERISA Event occurs with respect to a Pension Plan or
Multiemployer Plan which has resulted or could reasonably be expected to result
in liability of Carpenter under Title IV of ERISA to the Pension Plan,
Multiemployer Plan or the PBGC in an aggregate amount in excess of $20,000,000,
(ii) Carpenter or any ERISA Affiliate fails to pay when due, after the
expiration of any applicable grace period, any installment payment with respect
to its withdrawal liability under Section 4201 of ERISA under a Multiemployer
Plan in an aggregate amount in excess of $20,000,000, (iii) institution of any
steps by a Foreign Obligor or any other Person to terminate a Foreign Benefit
Plan if as a result of such termination, a Foreign Obligor or any of its
respective Subsidiaries is or could reasonably be expected to be required to
make a contribution to such Foreign Benefit Plan or has incurred or could
reasonably be expected to incur a liability or obligation to such Foreign
Benefit Plan, in excess of $20,000,000 or (iv) a contribution failure with
respect to any Foreign Benefit Plan sufficient to give rise to a Lien under
applicable Law occurs which has or could reasonably be expected to have a
Material Adverse Effect.

(i) Invalidity of Loan Documents. Any Loan Document, at any time after its
execution and delivery and for any reason other than as expressly permitted
hereunder or satisfaction in full of all the Obligations, ceases to be in full
force and effect, or is declared by a court of competent jurisdiction to be null
and void, invalid or unenforceable in any respect; any Borrower denies that it
has any or further liability or obligation under any Loan Document, or purports
to revoke, terminate or rescind any Loan Document; or any provision of Article X
of this Agreement shall for any reason cease to be valid and binding on or
enforceable against Carpenter or Carpenter shall so state in writing.

(j) Ownership. There shall occur a Change of Control.

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

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

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

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

(d) exercise on behalf of itself, the Lenders and the L/C Issuer all rights and
remedies available to it, the Lenders and the L/C Issuer under the Loan
Documents;

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

 

81

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

8.03 Application of Funds. After the exercise of remedies provided for in
Section 8.02 (or after the Loans have automatically become immediately due and
payable and the L/C Obligations have automatically been required to be Cash
Collateralized as set forth in the proviso to Section 8.02), any amounts
received on account of the Obligations shall, subject to the provisions of
Section 2.17 and Section 2.18 be applied by the Administrative Agent in the
following order:

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

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

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

Fourth, to payment of that portion of the Obligations constituting unpaid
principal of the Loans and L/C Borrowings, ratably among the Lenders and the L/C
Issuer in proportion to the respective amounts described in this clause Fourth
held by them;

Fifth, to the Administrative Agent for the account of the L/C Issuer, to Cash
Collateralize that portion of L/C Obligations comprised of the aggregate undrawn
amount of Letters of Credit to the extent not otherwise Cash Collateralized by
Carpenter pursuant to Section 2.04 or Section 2.17; and

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

Subject to Section 2.04(c) and Section 2.17, amounts used to Cash Collateralize
the aggregate undrawn amount of Letters of Credit pursuant to clause Fifth above
shall be applied to satisfy drawings under such Letters of Credit as they occur.
If any amount remains on deposit as Cash Collateral after all Letters of Credit
have either been fully drawn or expired, such remaining amount shall be applied
to the other Obligations, if any, in the order set forth above.

ARTICLE IX

ADMINISTRATIVE AGENT

9.01 Appointment and Authority.

Each of the Lenders and the L/C Issuer hereby irrevocably appoints Bank of
America to act on its behalf as the Administrative Agent hereunder and under the
other Loan Documents and authorizes the Administrative Agent to take such
actions on its behalf and to exercise such powers as are delegated to the
Administrative Agent by the terms hereof or thereof, together with such actions
and powers as are reasonably incidental thereto. The provisions of this Article
are solely for the benefit of the Administrative Agent, the Lenders and the L/C
Issuer, and Borrower shall have rights as a third party beneficiary of any of
such provisions. It is understood and agreed that the use of the term “agent”
herein or in any other Loan Documents (or any other similar term) with reference
to the Administrative Agent is not intended to connote any fiduciary or other
implied (or express) obligations arising under agency doctrine of any applicable
law. Instead such term is used as a matter of market custom, and is intended to
create or reflect only an administrative relationship between contracting
parties.

 

82

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

9.02 Rights as a Lender. The Person serving as the Administrative Agent
hereunder shall have the same rights and powers in its capacity as a Lender as
any other Lender and may exercise the same as though it were not the
Administrative Agent and the term “Lender” or “Lenders” shall, unless otherwise
expressly indicated or unless the context otherwise requires, include the Person
serving as the Administrative Agent hereunder in its individual capacity. Such
Person and its Affiliates may accept deposits from, lend money to, own
securities of, act as the financial advisor or in any other advisory capacity
for and generally engage in any kind of business with the Borrowers or any
Subsidiary or other Affiliate thereof as if such Person were not the
Administrative Agent hereunder and without any duty to account therefor to the
Lenders.

9.03 Exculpatory Provisions. The Administrative Agent shall not have any duties
or obligations except those expressly set forth herein and in the other Loan
Documents. Without limiting the generality of the foregoing, the Administrative
Agent:

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

(b) shall not have any duty to take any discretionary action or exercise any
discretionary powers, except discretionary rights and powers expressly
contemplated hereby or by the other Loan Documents that the Administrative Agent
is required to exercise as directed in writing by the Required Lenders (or such
other number or percentage of the Lenders as shall be expressly provided for
herein or in the other Loan Documents), provided that 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) shall not, except as expressly set forth herein and in the other Loan
Documents, have any duty to disclose, and shall not be liable for the failure to
disclose, any information relating to any of the Borrowers or any of their
respective Affiliates that is communicated to or obtained by the Person serving
as 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 (i) with the consent or at the request of the Required Lenders (or such
other number or percentage of the Lenders as shall be necessary, or as the
Administrative Agent shall believe in good faith shall be necessary, under the
circumstances as provided in Sections 11.01 and 8.02) or (ii) in the absence of
its own gross negligence or willful misconduct as determined by a court of
competent jurisdiction by final and nonappealable judgment. The Administrative
Agent shall be deemed not to have knowledge of any Default unless and until
notice describing such Default is given to the Administrative Agent in writing
by Carpenter, a Lender or the L/C Issuer.

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 this Agreement or any other Loan Document, (ii) the
contents of any certificate, report or other document delivered hereunder or
thereunder or in connection herewith or therewith, (iii) the performance or
observance of any of the covenants, agreements or other terms or conditions set
forth herein or therein or the occurrence of any Default, (iv) the validity,
enforceability, effectiveness or genuineness of this Agreement, any other Loan

 

83

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

Document or any other agreement, instrument or document or (v) the satisfaction
of any condition set forth in Article IV or elsewhere herein, other than to
confirm receipt of items expressly required to be delivered to the
Administrative Agent.

9.04 Reliance by 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, Internet or intranet website posting
or other distribution) believed by it to be genuine and to have been signed,
sent or otherwise authenticated by the proper Person. The Administrative Agent
also may rely upon any statement made to it orally or by telephone and believed
by it to have been made by the proper Person, and shall not incur any liability
for relying thereon. In determining compliance with any condition hereunder to
the making of a Loan, or the issuance, extension, renewal or increase of a
Letter of Credit, that by its terms must be fulfilled to the satisfaction of a
Lender or the L/C Issuer, the Administrative Agent may presume that such
condition is satisfactory to such Lender or the L/C Issuer unless the
Administrative Agent shall have received notice to the contrary from such Lender
or the L/C Issuer prior to the making of such Loan or the issuance of such
Letter of Credit. The Administrative Agent may consult with legal counsel (who
may be counsel for Carpenter), independent accountants and other experts
selected by it, and shall not be liable for any action taken or not taken by it
in accordance with the advice of any such counsel, accountants or experts.

9.05 Delegation of Duties. The Administrative Agent may perform any and all of
its duties and exercise its rights and powers hereunder or under any other Loan
Document by or through any one or more sub agents appointed by the
Administrative Agent. The Administrative Agent and any such sub agent may
perform any and all of its duties and exercise its rights and powers by or
through their respective Related Parties. The exculpatory provisions of this
Article shall apply to any such sub agent and to the Related Parties of the
Administrative Agent and any such sub agent, and shall apply to their respective
activities in connection with the syndication of the credit facility provided
for herein as well as activities as Administrative Agent. The Administrative
Agent shall not be responsible for the negligence or misconduct of any
sub-agents except to the extent that a court of competent jurisdiction
determines in a final and non-appealable judgment that the Administrative Agent
acted with gross negligence or willful misconduct in the selection of such
sub-agents.

9.06 Resignation of Administrative Agent. The Administrative Agent may at any
time give notice of its resignation to the Lenders, the L/C Issuer and
Carpenter. Upon receipt of any such notice of resignation, the Required Lenders
shall have the right, in consultation with Carpenter, to appoint a successor,
which shall be a bank with an office in the United States, or an Affiliate of
any such bank with an office in the United States. If no such successor shall
have been so appointed by the Required Lenders and shall have accepted such
appointment within 30 days after the retiring Administrative Agent gives notice
of its resignation, then the retiring Administrative Agent may on behalf of the
Lenders and the L/C Issuer, appoint a successor Administrative Agent meeting the
qualifications set forth above; provided that if the Administrative Agent shall
notify Carpenter and the Lenders that no qualifying Person has accepted such
appointment, then such resignation shall nonetheless become effective in
accordance with such notice and (1) the retiring Administrative Agent shall be
discharged from its duties and obligations hereunder and under the other Loan
Documents and (2) all payments, communications and determinations provided to be
made by, to or through the Administrative Agent shall instead be made by or to
each Lender and the L/C Issuer directly, until such time as the Required Lenders
appoint a successor Administrative Agent as provided for above in this Section.
Upon the acceptance of a successor’s appointment as Administrative Agent
hereunder, such successor shall succeed to and become vested with all of the
rights, powers, privileges and duties of the retiring (or retired)
Administrative Agent, and the retiring Administrative Agent shall be discharged
from all of its duties and obligations hereunder or under the other Loan
Documents (if not already discharged therefrom as provided above in this
Section). The

 

84

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

fees payable by Carpenter to a successor Administrative Agent shall be the same
as those payable to its predecessor unless otherwise agreed between Carpenter
and such successor. After the retiring Administrative Agent’s resignation
hereunder and under the other Loan Documents, the provisions of this Article and
Section 11.04 shall continue in effect for the benefit of such retiring
Administrative Agent, its sub agents and their respective Related Parties in
respect of any actions taken or omitted to be taken by any of them while the
retiring Administrative Agent was acting as Administrative Agent.

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

9.07 Non-Reliance on Administrative Agent and Other Lenders. Each Lender and the
L/C Issuer acknowledges that it has, independently and without reliance upon the
Administrative Agent or any other Lender or any of their Related Parties and
based on such documents and information as it has deemed appropriate, made its
own credit analysis and decision to enter into this Agreement. Each Lender and
the L/C Issuer also acknowledges that it will, independently and without
reliance upon the Administrative Agent or any other Lender or any of their
Related Parties and based on such documents and information as it shall from
time to time deem appropriate, continue to make its own decisions in taking or
not taking action under or based upon this Agreement, any other Loan Document or
any related agreement or any document furnished hereunder or thereunder.

9.08 No Other Duties, Etc. Anything herein to the contrary notwithstanding, none
of the bookrunners, arrangers, syndications agents, documentation agents or
co-agents shall have any powers, duties or responsibilities under this Agreement
or any of the other Loan Documents, except in its capacity, as applicable, as
the Administrative Agent, a Lender or the L/C Issuer hereunder.

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

(a) to file and prove a claim for the whole amount of the principal and interest
owing and unpaid in respect of the Loans, L/C Obligations and all other
Obligations that are owing and unpaid and to file such other documents as may be
necessary or advisable in order to have the claims of the Lenders, the L/C
Issuer and the Administrative Agent (including any claim for the reasonable
compensation, expenses, disbursements and advances of the Lenders, the L/C
Issuer and the Administrative Agent and their respective agents and counsel and
all other amounts due the Lenders, the L/C Issuer and the Administrative Agent
under Sections 2.04(h) and (i), 2.10 and 11.04) allowed in such judicial
proceeding; and

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

 

85

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

and any custodian, receiver, assignee, trustee, liquidator, sequestrator or
other similar official in any such judicial proceeding is hereby authorized by
each Lender and the L/C Issuer to make such payments to the Administrative Agent
and, in the event that the Administrative Agent shall consent to the making of
such payments directly to the Lenders and the L/C Issuer, 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 Sections 2.10
and 11.04.

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

ARTICLE X

CONTINUING GUARANTY

10.01 Unconditional Guarantee. For valuable consideration, receipt whereof is
hereby acknowledged, and to induce each Lender to make Loans and the Issuing
Lender to issue Letters of Credit to the Borrowers and to induce the
Administrative Agent to act hereunder, Carpenter hereby unconditionally and
irrevocably guarantees to each Lender and the Administrative Agent the punctual
payment when due, whether at stated maturity, by acceleration or otherwise, of
all of (a) the Obligations and (b) the Specified Obligations (collectively with
the Obligations, the “Guaranteed Obligations”). Without limiting the generality
of the foregoing, Carpenter’s liability shall extend to all amounts that
constitute part of the Guaranteed Obligations and would be owed by any of the
Subsidiary Borrowers to the Administrative Agent or any Lender under this
Agreement but for the fact that they are unenforceable or not allowable due to
the existence of a bankruptcy, reorganization or similar proceeding involving
any Subsidiary Borrower. This is a guaranty of payment and not merely as a
guaranty of collection. The Administrative Agent’s books and records showing the
amount of the Guaranteed Obligations shall be admissible in evidence in any
action or proceeding, and shall be binding upon Carpenter, and conclusive for
the purpose of establishing the amount of the Guaranteed Obligations.

10.02 Guarantee Absolute. Carpenter guarantees that the Guaranteed Obligations
will be paid strictly in accordance with the terms of this Agreement, regardless
of any law, regulation or order now or hereafter in effect in any jurisdiction
affecting any of such terms or the rights of any Lender or any Agent with
respect thereto. The obligations of Carpenter under this Article X are
independent of the Guaranteed Obligations, and a separate action or actions may
be brought and prosecuted against Carpenter to enforce this Article X,
irrespective of whether any action is brought against any other Borrower or
whether any other Borrower is joined in any such action or actions. The
liability of Carpenter under this guarantee shall be irrevocable, absolute and
unconditional irrespective of, and Carpenter hereby irrevocably waives any
defenses it may now or hereafter have in any way relating to, any or all of the
following:

(a) any lack of validity or enforceability of this Agreement or any other
agreement or instrument relating thereto;

(b) any change in the time, manner or place of payment of, or in any other term
of, all or any of the Guaranteed Obligations, or any other amendment or waiver
of or any consent to departure from this Agreement;

 

86

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

(c) any taking, exchange, release or non–perfection of any collateral or any
taking, release or amendment or waiver of or consent to departure from any other
guaranty, for all or any of the Guaranteed Obligations;

(d) any change, restructuring or termination of the corporate structure or
existence of any Borrower; or

(e) any other circumstance, (including, without limitation, any statute of
limitations to the fullest extent permitted by applicable law) which might
otherwise constitute a defense available to, or a discharge of, Carpenter, the
other Borrowers or any other guarantor.

(f) This guaranty shall continue to be effective or be reinstated, as the case
may be, if at any time any payment of any of the Guaranteed Obligations is
rescinded or must otherwise be returned by any of the Lenders or the
Administrative Agent upon the insolvency, bankruptcy or reorganization of any
Borrower or otherwise, all as though such payment had not been made.

10.03 Waivers.

(a) Carpenter hereby expressly waives promptness, diligence, notice of
acceptance, presentment, demand for payment, protest, any requirement that any
right or power be exhausted or any action be taken against any Borrower or
against any other guarantor of all or any portion of the Guaranteed Obligations,
and all other notices and demands whatsoever.

(b) Carpenter hereby waives any right to revoke this guaranty, and acknowledges
that this guaranty is continuing in nature and applies to all Guaranteed
Obligations, whether existing now or in the future and regardless of whether the
Guaranteed Obligations is reduced to zero at any time or from time to time.

(c) Carpenter acknowledges that it will receive substantial direct and indirect
benefits from the financing arrangements contemplated herein and that the
waivers set forth in this Article X are knowingly made in contemplation of such
benefits.

(d) Carpenter agrees that payments made by it pursuant to this Article X will be
subject to the provisions of Section 3.01 as if such payments were made by the
other Borrowers.

10.04 Subrogation. Carpenter will not exercise any rights that it may now or
hereafter acquire against any other Borrower or any other insider guarantor that
arise from the existence, payment, performance or enforcement of the Guaranteed
Obligations under this Agreement, including, without limitation, any right of
subrogation, reimbursement, exoneration, contribution or indemnification and any
right to participate in any claim or remedy of the Administrative Agent or any
Lender against any such Borrower or any other insider guarantor or any
collateral, whether or not such claim, remedy or right arises in equity or under
contract, statute or common law, including, without limitation, the right to
take or receive from any such Borrower or any other insider guarantor, directly
or indirectly, in cash or other property or by set–off or in any other manner,
payment or security on account of such claim, remedy or right, unless and until
all of the Guaranteed Obligations and all other amounts payable under this
guaranty shall have been paid in full in cash and the Commitments shall have
expired or terminated. If any amount shall be paid to Carpenter in violation of
the preceding sentence at any time prior to the later of the payments in full in
cash or immediately available funds of the Guaranteed Obligations and all other
amounts payable under this guaranty and the Maturity Date, such amount shall be
held in trust for the benefit of the Administrative Agent and the Lenders and
shall forthwith be paid to the Administrative Agent to be credited and applied
to the Guaranteed Obligations and all other amounts payable under this

 

87

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

guaranty, whether matured or unmatured, in accordance with the terms of this
Agreement, or to be held as collateral for any Guaranteed Obligations or other
amounts payable under this guaranty thereafter arising. If (a) Carpenter shall
make payment to the Administrative Agent or any other Lender of all or any part
of the Guaranteed Obligations and the termination of the Commitments and the
expiration or cancellation of all Letters of Credit shall have occurred, (b) all
the Guaranteed Obligations and all other amounts payable under this guaranty
shall be paid in full in cash and (c) the Maturity Date shall have occurred, the
Administrative Agent and the Lenders will, at Carpenter’s request and expense,
execute and deliver to Carpenter appropriate documents, without recourse and
without representation or warranty, necessary to evidence the transfer by
subrogation to Carpenter of an interest in the Guaranteed Obligations resulting
from such payment by Carpenter. Carpenter acknowledges that it will receive
direct and indirect benefits from the financing arrangements contemplated by
this Agreement and that the waiver set forth in this section is knowingly made
in contemplation of such benefits.

10.05 Survival. This guaranty is a continuing guarantee and shall (a) remain in
full force and effect until payment in full (after the Maturity Date) of the
Guaranteed Obligations and all other amounts payable under this guaranty and the
termination of the Commitments and the expiration or cancellation of all Letters
of Credit, (b) be binding upon Carpenter, its successors and assigns, (c) inure
to the benefit of and be enforceable by each Lender (including each assignee
Lender pursuant to Section 11.06) and the Administrative Agent and its
respective successors, transferees, and assigns and (d) shall be reinstated if
at any time any payment to a Lender or the Administrative Agent hereunder is
required to be restored by such Lender or the Administrative Agent. Without
limiting the generality of the foregoing clause (c), each Lender may assign or
otherwise transfer its interest in any Loan or Letter of Credit to any other
Person, and such other Person shall thereupon become vested with all the rights
in respect thereof granted to such Lender herein or otherwise.

10.06 Subordination. Carpenter hereby subordinates the payment of all
obligations and indebtedness of any Subsidiary Borrower owing to Carpenter,
whether now existing or hereafter arising, including but not limited to any
obligation of any Subsidiary Borrower to Carpenter as subrogee of the Lenders or
resulting from Carpenter’ performance under this guaranty, to the indefeasible
payment in full in cash of all Guaranteed Obligations. If the Lenders so
request, any such obligation or indebtedness of any Subsidiary Borrower to
Carpenter shall be enforced and performance received by Carpenter as trustee for
the Lenders and the proceeds thereof shall be paid over to the Lenders on
account of the Guaranteed Obligations, but without reducing or affecting in any
manner the liability of Carpenter under this guaranty.

10.07 Stay of Acceleration. If acceleration of the time for payment of any of
the Guaranteed Obligations is stayed, in connection with any case commenced by
or against Carpenter or any Subsidiary Borrower under any Debtor Relief Laws, or
otherwise, all such amounts shall nonetheless be payable by Carpenter
immediately upon demand by the Lenders.

10.08 Condition of Borrower. Carpenter acknowledges and agrees that it has the
sole responsibility for, and has adequate means of, obtaining from any
Subsidiary Borrower and any other Subsidiary such information concerning the
financial condition, business and operations of any Subsidiary Borrower and any
such other Subsidiary as Carpenter requires, and that none of the Lenders has
any duty, and Carpenter is not relying on the Lenders at any time, to disclose
to Carpenter any information relating to the business, operations or financial
condition of any Subsidiary Borrower or any other Subsidiary (Carpenter waiving
any duty on the part of the Lenders to disclose such information and any defense
relating to the failure to provide the same).

 

88

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

ARTICLE XI

MISCELLANEOUS

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

(a) waive any condition set forth in Section 4.01(a) or Section 4.01(b) without
the written consent of each Lender;

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

(c) postpone any date fixed by this Agreement or any other Loan Document for any
payment (excluding mandatory prepayments) of principal, interest, fees or other
amounts due to the Lenders (or any of them) or any scheduled or mandatory
reduction of the Aggregate Commitments hereunder or under any other Loan
Document without the written consent of each Lender directly affected thereby;

(d) reduce the principal of, or the rate of interest specified herein on, any
Loan or L/C Borrowing, or (subject to clause (iv) of the second proviso to this
Section 11.01) any fees or other amounts payable hereunder or under any other
Loan Document without the written consent of each Lender directly affected
thereby; provided, however, that only the consent of the Required Lenders shall
be necessary (i) to amend the definition of “Default Rate” or to waive any
obligation of any Borrower to pay interest or Letter of Credit Fees at the
Default Rate or (ii) to amend any financial covenant hereunder (or any defined
term used therein) even if the effect of such amendment would be to reduce the
rate of interest on any Loan or L/C Borrowing or to reduce any fee payable
hereunder;

(e) change Section 2.14 or Section 8.03 in a manner that would alter the pro
rata sharing of payments required thereby without the written consent of each
Lender;

(f) amend Section 1.06 or the definition of “Alternative Currency” without the
written consent of each Lender and the L/C Issuer;

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

(h) release Carpenter from the guaranty given pursuant to Article X without the
written consent of each Lender;

and, provided further, that (i) no amendment, waiver or consent shall, unless in
writing and signed by the L/C Issuer in addition to the Lenders required above,
affect the rights or duties of the L/C Issuer under this Agreement or any Issuer
Document relating to any Letter of Credit issued or to be issued by it; (ii) no
amendment, waiver or consent shall, unless in writing and signed by the Swing
Line Lender in addition to the Lenders required above, affect the rights or
duties of the Swing Line Lender under this Agreement; (iii) no amendment, waiver
or consent shall, unless in writing and signed by the Administrative Agent in
addition to the Lenders required above, affect the rights or duties of the
Administrative Agent under this

 

89

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

Agreement or any other Loan Document; and (iv) the Fee Letters may be amended,
or rights or privileges thereunder waived, in a writing executed only by the
parties thereto. Notwithstanding anything to the contrary herein, no Defaulting
Lender shall have any right to approve or disapprove any amendment, waiver or
consent hereunder (and any amendment, waiver or consent which by its terms
requires the consent of all Lenders or each affected Lender may be effected with
the consent of the applicable Lenders other than Defaulting Lenders), except
that (x) the Commitment of any Defaulting Lender may not be increased or
extended without the consent of such Lender and (y) any waiver, amendment or
modification requiring the consent of all Lenders or each affected Lender that
by its terms affects any Defaulting Lender more adversely than other affected
Lenders shall require the consent of such Defaulting Lender.

11.02 Notices; Effectiveness; Electronic Communication.

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

(i) if to a Borrower, the Administrative Agent, the L/C Issuer or the Swing Line
Lender, to the address, telecopier number, electronic mail address or telephone
number specified for such Person on Schedule 11.02; and

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

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

(b) Electronic Communications. Notices and other communications to the Lenders
and the L/C Issuer 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 L/C Issuer pursuant to Article
II if such Lender or the L/C Issuer, as applicable, has notified the
Administrative Agent that it is incapable of receiving notices under such
Article by electronic communication. The Administrative Agent or Carpenter may,
in its discretion, agree to accept notices and other communications to it
hereunder by electronic communications pursuant to procedures approved by it,
provided that approval of such procedures may be limited to particular notices
or communications.

Unless the Administrative 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.

 

90

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

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

(d) Change of Address, Etc. Each of the Borrowers, the Administrative Agent, the
L/C Issuer and the Swing Line Lender may change its address, telecopier or
telephone number for notices and other communications hereunder by notice to the
other parties hereto. Each other Lender may change its address, telecopier or
telephone number for notices and other communications hereunder by notice to
Carpenter, the Administrative Agent, the L/C Issuer and the Swing Line Lender.
In addition, each Lender agrees to notify the Administrative Agent from time to
time to ensure that the Administrative Agent has on record (i) an effective
address, contact name, telephone number, telecopier number and electronic mail
address to which notices and other communications may be sent and (ii) accurate
wire instructions for such Lender. Furthermore, 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 United States Federal and state securities laws,
to make reference to Borrower Materials that are not made available through the
“Public Side Information” portion of the Platform and that may contain material
non-public information with respect to Carpenter or its securities for purposes
of United States Federal or state securities laws.

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

 

91

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

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

Notwithstanding anything to the contrary contained herein or in any other Loan
Document, the authority to enforce rights and remedies hereunder and under the
other Loan Documents against the Borrowers or any of them shall be vested
exclusively in, and all actions and proceedings at law in connection with such
enforcement shall be instituted and maintained exclusively by, the
Administrative Agent in accordance with Section 8.02 for the benefit of all the
Lenders and the L/C Issuer; provided, however, that the foregoing shall not
prohibit (a) the Administrative Agent from exercising on its own behalf the
rights and remedies that inure to its benefit (solely in its capacity as
Administrative Agent) hereunder and under the other Loan Documents, (b) the L/C
Issuer or the Swing Line Lender from exercising the rights and remedies that
inure to its benefit (solely in its capacity as L/C Issuer or Swing Line Lender,
as the case may be) hereunder and under the other Loan Documents, (c) any Lender
from exercising setoff rights in accordance with Section 11.08 (subject to the
terms of Section 2.14), or (d) any Lender from filing proofs of claim or
appearing and filing pleadings on its own behalf during the pendency of a
proceeding relative to any Borrower under any Debtor Relief Law; and provided,
further, that if at any time there is no Person acting as Administrative Agent
hereunder and under the other Loan Documents, then (i) the Required Lenders
shall have the rights otherwise ascribed to the Administrative Agent pursuant to
Section 8.02 and (ii) in addition to the matters set forth in clauses (b),
(c) and (d) of the preceding proviso and subject to Section 2.14, any Lender
may, with the consent of the Required Lenders, enforce any rights and remedies
available to it and as authorized by the Required Lenders.

11.04 Expenses; Indemnity; Damage Waiver.

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

(b) Indemnification by Carpenter. Carpenter shall indemnify the Administrative
Agent (and any sub-agent thereof), each Lender and the L/C Issuer, 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), incurred by any
Indemnitee or asserted against any Indemnitee by any third party or by any
Borrower 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

 

92

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

contemplated hereby or thereby, the performance by the parties hereto of their
respective obligations hereunder or thereunder, the consummation of the
transactions contemplated hereby or thereby, or, in the case of the
Administrative Agent (and any sub-agent thereof) and its Related Parties only,
the administration of this Agreement and the other Loan Documents (including in
respect of any matters addressed in Section 3.01), (ii) any Loan or Letter of
Credit or the use or proposed use of the proceeds therefrom (including any
refusal by the L/C Issuer to honor a demand for payment under a Letter of Credit
if the documents presented in connection with such demand do not strictly comply
with the terms of such Letter of Credit), (iii) any actual or alleged presence
or release of Hazardous Materials on or from any property owned or operated by
any Borrower or any of its Subsidiaries, or any Environmental Liability related
in any way to any Borrower or any of its Subsidiaries, or (iv) any actual or
prospective claim, litigation, investigation or proceeding relating to any of
the foregoing, whether based on contract, tort or any other theory, whether
brought by a third party or by Carpenter or any other Borrower, and regardless
of whether any Indemnitee is a party thereto; provided that such indemnity shall
not, as to any Indemnitee, be available to the extent that such losses, claims,
damages, liabilities or related expenses (x) are determined by a court of
competent jurisdiction by final and nonappealable judgment to have resulted from
the gross negligence or willful misconduct of such Indemnitee or (y) result from
a claim brought by Carpenter or any other Borrower against an Indemnitee for
breach in bad faith of such Indemnitee’s obligations hereunder or under any
other Loan Document, if Carpenter or such other Borrower has obtained a final
and nonappealable judgment in its favor on such claim as determined by a court
of competent jurisdiction.

(c) Reimbursement by Lenders. To the extent that Carpenter for any reason fails
to indefeasibly pay any amount required under subsection (a) or (b) of this
Section to be paid by it to the Administrative Agent (or any sub-agent thereof),
the L/C Issuer, the Swing Line Lender or any Related Party of any of the
foregoing, each Lender severally agrees to pay to the Administrative Agent (or
any such sub-agent), the L/C Issuer, the Swing Line Lender or such Related
Party, as the case may be, such Lender’s Applicable Percentage (determined as of
the time that the applicable unreimbursed expense or indemnity payment is
sought) of such unpaid amount, provided that the unreimbursed expense or
indemnified loss, claim, damage, liability or related expense, as the case may
be, was incurred by or asserted against the Administrative Agent (or any such
sub-agent), the L/C Issuer or the Swing Line Lender in its capacity as such, or
against any Related Party of any of the foregoing acting for the Administrative
Agent (or any such sub-agent), the L/C Issuer or the Swing Line Lender in
connection with such capacity. The obligations of the Lenders under this
subsection (c) are subject to the provisions of Section 2.13(d).

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

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

 

93

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

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

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

11.06 Successors and Assigns.

(a) Successors and Assigns Generally. The provisions of this Agreement shall be
binding upon and inure to the benefit of the parties hereto and their respective
successors and assigns permitted hereby, except that no 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 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 (e) 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,
the L/C Issuer and the Lenders) any legal or equitable right, remedy or claim
under or by reason of this Agreement.

(b) Assignments by Lenders. Any Lender may at any time assign to one or more
assignees all or a portion of its rights and obligations under this Agreement
(including all or a portion of its Commitment and the Loans (including for
purposes of this subsection (b), participations in L/C Obligations and in Swing
Line Loans) at the time owing to it); provided that any such assignment shall be
subject to the following conditions:

(i) Minimum Amounts.

(A) in the case of an assignment of the entire remaining amount of the assigning
Lender’s Commitment and the Loans 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

 

94

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

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

(ii) Proportionate Amounts. Each partial assignment shall be made as an
assignment of a proportionate part of all the assigning Lender’s rights and
obligations under this Agreement with respect to the Loans or the Commitment
assigned, except that this clause (ii) shall not apply to the rights in respect
of Bid Loans or the Swing Line Lender’s rights and obligations in respect of
Swing Line Loans;

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

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

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

(D) the consent of the Swing Line Lender (such consent not to be unreasonably
withheld or delayed) shall be required for any assignment.

(iv) Assignment and Assumption. The parties to each assignment shall execute and
deliver to the Administrative Agent an Assignment and Assumption, together with
a processing and recordation fee in the amount of $3,500; provided, however,
that the Administrative Agent may, in its sole discretion, elect to waive such
processing and recordation fee in the case of any assignment. The assignee, if
it is not a Lender, shall deliver to the Administrative Agent an Administrative
Questionnaire.

(v) No Assignment to Certain Persons. No such assignment shall be made to
(A) Carpenter or any of Carpenter’s Affiliates or Subsidiaries, (B) 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) or (C) a natural person.

 

95

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

(vi) 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 Carpenter 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 L/C Issuer,
the Swing Line 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 Swing Line Loans in
accordance with its Applicable Percentage. Notwithstanding the foregoing, in the
event that 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 Assumption, the assignee thereunder shall be a party to
this Agreement and, to the extent of the interest assigned by such Assignment
and Assumption, have the rights and obligations of a Lender under this Agreement
including, for the avoidance of doubt, the obligation to provide the Borrower or
Administrative Agent with any tax forms required by Section 3.01(e), and the
assigning Lender thereunder shall, to the extent of the interest assigned by
such Assignment and Assumption, be released from its obligations under this
Agreement (and, in the case of an Assignment and Assumption covering all of the
assigning Lender’s rights and obligations under this Agreement, such Lender
shall cease to be a party hereto) but shall continue to be entitled to the
benefits of Sections 3.01, 3.04, 3.05, and 11.04 with respect to facts and
circumstances occurring prior to 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 that Lender’s having been a Defaulting
Lender. Upon request, each Borrower (at its expense) shall execute and deliver a
Note to the assignee Lender. Any assignment or transfer by a Lender of rights or
obligations under this Agreement that does not comply with this subsection shall
be treated for purposes of this Agreement as a sale by such Lender of a
participation in such rights and obligations in accordance with subsection
(d) of this Section.

(c) Register. The Administrative Agent, acting solely for this purpose as an
agent of the Borrowers, shall maintain at the Administrative Agent’s Office a
copy of each Assignment and Assumption delivered to it and a register for the
recordation of the names and addresses of the Lenders, and the Commitments of,
and principal amounts of the Loans and L/C Obligations owing to, each Lender
pursuant to the terms hereof from time to time (the “Register”). The entries in
the Register shall be conclusive absent manifest error, and the Borrowers, the
Administrative Agent and the Lenders may treat each Person whose name is
recorded in the Register pursuant to the terms hereof as a Lender hereunder for
all purposes of this Agreement, notwithstanding notice to the contrary. The
Register shall be available for inspection by the Borrowers and any Lender, at
any reasonable time and from time to time upon reasonable prior notice. This
Section 11.06(c) and Section 11.06(d) shall be construed so that the Loans and
the L/C Borrowings are at all times maintained in the “registered form” within
the meaning of Section 163(f), 871(h)(2) and 881(c)(2) of the Code.

 

96

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

(d) Participations. Any Lender may at any time, without the consent of, or
notice to, any Borrower or the Administrative Agent, sell participations to any
Person (other than a natural person, a Defaulting Lender, Carpenter or any of
Carpenter’s Affiliates or Subsidiaries) (each, a “Participant”) in all or a
portion of such Lender’s rights and/or obligations under this Agreement
(including all or a portion of its Commitment and/or the Loans (including such
Lender’s participations in L/C Obligations and/or Swing Line 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) the Borrowers,
the Administrative Agent, the Lenders and the L/C Issuer shall continue to deal
solely and directly with such Lender in connection with such Lender’s rights and
obligations under this Agreement. For the avoidance of doubt, each Lender shall
be responsible for the indemnity under Section 11.04(d) with respect to any
payments made by such Lender to its Participants. Any agreement or instrument
pursuant to which a Lender sells such a participation shall provide that such
Lender shall retain the sole right to enforce this Agreement and to approve any
amendment, modification or waiver of any provision of this Agreement; provided
that such agreement or instrument may provide that such Lender will not, without
the consent of the Participant, agree to any amendment, waiver or other
modification described in the first proviso to Section 11.01 that affects such
Participant. Subject to subsection (e) of this Section, each Borrower agrees
that each Participant shall be entitled to the benefits of Sections 3.01, 3.04
and 3.05 (subject to the requirements and limitations therein, including the
requirements under Section 3.01(e) (it being understood that the documentation
required under Section 3.01(e) shall be delivered to the participating Lender))
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 (A) agrees to be subject to the provisions of Section 3.06 as if it
were an assignee under subsection (b) of this Section; and (B) shall not be
entitled to receive any greater payment under Sections 3.01 or 3.04, with
respect to any participation, than its participating Lender would have been
entitled to receive. A Participant that would be a Foreign Lender if it were a
Lender shall not be entitled to the benefits of Section 3.01 unless Carpenter is
notified of the participation sold to such Participant and such Participant
agrees, for the benefit of the Borrowers, to comply with Section 3.01(e) as
though it were a Lender. To the extent permitted by law, each Participant also
shall be entitled to the benefits of Section 11.08 as though it were a Lender,
provided such Participant agrees to be subject to Section 2.14 as though it were
a Lender. Each Lender that sells a participation shall, acting solely for this
purpose as an agent of Carpenter, maintain a register 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”); provided that no Lender shall
have any obligation to disclose all or any portion of the Participant Register
to any Person (including the identity of any Participant or any information
relating to a Participant’s interest in any commitments, loans, letters of
credit or its other obligations under any Loan Document) except to the extent
that such disclosure is necessary to establish that such commitment, loan,
letter of credit or other obligation is in registered form under
Section 5f.103-1(c) of the United States Treasury Regulations or, if different,
Section 871(h) or 881(c) of the Code. 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.

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

(f) Resignation as L/C Issuer or Swing Line Lender after Assignment.
Notwithstanding anything to the contrary contained herein, if at any time Bank
of America assigns all of its Commitment and Loans pursuant to subsection
(b) above, Bank of America may, (i) upon 30 days’ notice to Carpenter

 

97

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

and the Lenders, resign as L/C Issuer and/or (ii) upon 30 days’ notice to
Carpenter, resign as Swing Line Lender. In the event of any such resignation as
L/C Issuer or Swing Line Lender, Carpenter shall be entitled to appoint from
among the Lenders a successor L/C Issuer or Swing Line Lender hereunder;
provided, however, that no failure by Carpenter to appoint any such successor
shall affect the resignation of Bank of America as L/C Issuer or Swing Line
Lender, as the case may be. If Bank of America resigns as L/C Issuer, it shall
retain all the rights, powers, privileges and duties of the L/C Issuer hereunder
with respect to all Letters of Credit outstanding as of the effective date of
its resignation as L/C Issuer and all L/C Obligations with respect thereto
(including the right to require the Lenders to make Base Rate Committed Loans or
fund risk participations in Unreimbursed Amounts pursuant to Section 2.04(c)).
If Bank of America resigns as Swing Line Lender, it shall retain all the rights
of the Swing Line Lender provided for hereunder with respect to Swing Line Loans
made by it and outstanding as of the effective date of such resignation,
including the right to require the Lenders to make Base Rate Committed Loans or
fund risk participations in outstanding Swing Line Loans pursuant to
Section 2.05(c). Upon the appointment of a successor L/C Issuer and/or Swing
Line Lender, (a) such successor shall succeed to and become vested with all of
the rights, powers, privileges and duties of the retiring L/C Issuer or Swing
Line Lender, as the case may be, and (b) the successor L/C Issuer shall issue
letters of credit in substitution for the Letters of Credit, if any, outstanding
at the time of such succession or make other arrangements satisfactory to Bank
of America to effectively assume the obligations of Bank of America with respect
to such Letters of Credit.

11.07 Treatment of Certain Information; Confidentiality. Each of the
Administrative Agent, the Lenders and the L/C Issuer agrees to maintain the
confidentiality of the Information (as defined below), except that Information
may be disclosed (a) to its Related Parties (it being understood that the
Persons to whom such disclosure is made will be informed of the confidential
nature of such Information and instructed to keep such Information
confidential), (b) to the extent required or requested by, or required to be
disclosed to, any rating agency or regulatory or similar authority purporting to
have jurisdiction over such Person or its Related Parties (including any
self-regulatory authority, such as the National Association of Insurance
Commissioners), (c) to the extent required by applicable laws or regulations or
by any subpoena or similar legal process, (d) to any other party hereto, (e) in
connection with the exercise of any remedies hereunder or under any other Loan
Document or any action or proceeding relating to this Agreement or any other
Loan Document or the enforcement of rights hereunder or thereunder, (f) subject
to an agreement containing provisions substantially the same as those of this
Section, to (i) any assignee of or Participant in, or any prospective assignee
of or Participant in, any of its rights or obligations under this Agreement or
any Eligible Assignee invited to be a Lender pursuant to Section 2.17(c) or
(ii) any actual or prospective counterparty (or its advisors) to any swap or
derivative transaction relating to a Borrower and its obligations, (g) to the
CUSIP Service Bureau or any similar agency in connection with the issuance and
monitoring of CUSIP numbers with respect to the credit facility provided for
herein and to Gold Sheets and other similar bank trade publications, such
information to consist of deal terms and other information customarily found in
such publications, (h) with the consent of Carpenter or (i) to the extent such
Information (x) becomes publicly available other than as a result of a breach of
this Section or (y) becomes available to the Administrative Agent, any Lender,
the L/C Issuer or any of their respective Affiliates on a nonconfidential basis
from a source other than Carpenter.

For purposes of this Section, “Information” means all information received from
Carpenter or any Subsidiary relating to Carpenter or any Subsidiary or any of
their respective businesses, other than any such information that is available
to the Administrative Agent, any Lender or the L/C Issuer on a nonconfidential
basis prior to disclosure by Carpenter or any Subsidiary, provided that, in the
case of information received from Carpenter or any Subsidiary after the date
hereof, such information is clearly identified at the time of delivery as
confidential. Any Person required to maintain the confidentiality of Information
as provided in this Section shall be considered to have complied with its
obligation to do so if such Person has exercised the same degree of care to
maintain the confidentiality of such Information as such Person would accord to
its own confidential information.

 

98

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

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

11.08 Right of Setoff. If an Event of Default shall have occurred and be
continuing, each Lender, the L/C Issuer and each of their respective Affiliates
is hereby authorized at any time and from time to time, to the fullest extent
permitted by applicable law, to set off and apply any and all deposits (general
or special, time or demand, provisional or final, in whatever currency) at any
time held and other obligations (in whatever currency) at any time owing by such
Lender, the L/C Issuer or any such Affiliate to or for the credit or the account
of any Borrower against any and all of the obligations of such Borrower now or
hereafter existing under this Agreement or any other Loan Document to such
Lender or the L/C Issuer, irrespective of whether or not such Lender or the L/C
Issuer shall have made any demand under this Agreement or any other Loan
Document and although such obligations of such Borrower may be contingent or
unmatured or are owed to a branch or office of such Lender or the L/C Issuer
different from the branch or office holding such deposit or obligated on such
indebtedness; provided that in the event that 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 2.18 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 L/C Issuer, 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.
The rights of each Lender, the L/C Issuer and their respective Affiliates under
this Section are in addition to other rights and remedies (including other
rights of setoff) that such Lender, the L/C Issuer or their respective
Affiliates may have. Each Lender and the L/C Issuer agrees to notify Carpenter
and the Administrative Agent promptly after any such setoff and application,
provided that the failure to give such notice shall not affect the validity of
such setoff and application.

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

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

 

99

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

received counterparts hereof that, when taken together, bear the signatures of
each of the other parties hereto. Delivery of an executed counterpart of a
signature page of this Agreement by telecopy or other electronic imaging means
shall be effective as delivery of a manually executed counterpart of this
Agreement.

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

11.12 Severability. If any provision of this Agreement or the other Loan
Documents is held to be illegal, invalid or unenforceable, (a) the legality,
validity and enforceability of the remaining provisions of this Agreement and
the other Loan Documents shall not be affected or impaired thereby and (b) the
parties shall endeavor in good faith negotiations to replace the illegal,
invalid or unenforceable provisions with valid provisions the economic effect of
which comes as close as possible to that of the illegal, invalid or
unenforceable provisions. The invalidity of a provision in a particular
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction. Without limiting the foregoing provisions of this
Section 11.12, if and to the extent that the enforceability of any provisions in
this Agreement relating to Defaulting Lenders shall be limited by Debtor Relief
Laws, as determined in good faith by the Administrative Agent, the L/C Issuer or
the Swing Line Lender, as applicable, then such provisions shall be deemed to be
in effect only to the extent not so limited.

11.13 Replacement of Lenders. If (i) any Lender requests compensation under
Section 3.04, (ii) 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 3.01, (iii) the obligation of any Lender to make Eurocurrency Loans has
been suspended pursuant to Section 3.02 (iii) a Lender (a “Non-Consenting
Lender”) does not consent to a proposed change, waiver, discharge or termination
with respect to any Loan Document that has been approved by the Required Lenders
as provided in Section 11.01 but requires unanimous consent of all Lenders or
all Lenders directly affected thereby (as applicable) or (iv) any Lender is a
Defaulting Lender, then Carpenter may, at its 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 contained in, and consents required by, Section 11.06), all of its
interests, rights and obligations under this Agreement and the related Loan
Documents to an assignee that shall assume such obligations (which assignee may
be another Lender, if a Lender accepts such assignment), provided that:

(a) Carpenter shall have paid (or caused a Subsidiary Borrower to pay) to the
Administrative Agent the assignment fee specified in Section 11.06(b);

(b) such Lender shall have received payment of an amount equal to the
outstanding principal of its Loans and L/C Advances, accrued interest thereon,
accrued fees and all other amounts payable to it hereunder and under the other
Loan Documents (including any amounts under Section 3.05) from the assignee (to
the extent of such outstanding principal and accrued interest and fees) or
Carpenter or applicable Subsidiary Borrower (in the case of all other amounts);

 

100

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

(c) in the case of any such assignment resulting from a claim for compensation
under Section 3.04 or payments required to be made pursuant to Section 3.01,
such assignment will result in a reduction in such compensation or payments
thereafter; and

(d) such assignment does not conflict with applicable Laws.

(e) in the case of any such assignment resulting from a Non-Consenting Lender’s
failure to consent to a proposed change, waiver, discharge or termination with
respect to any Loan Document, the applicable replacement bank, financial
institution or Fund consents to the proposed change, waiver, discharge or
termination; provided that the failure by such Non-Consenting Lender to execute
and deliver an Assignment and Assumption shall not impair the validity of the
removal of such Non-Consenting Lender and the mandatory assignment of such
Non-Consenting Lender’s Commitments and outstanding Loans and participations in
L/C Obligations and Swing Line Loans pursuant to this Section 11.13 shall
nevertheless be effective without the execution by such Non-Consenting Lender of
an Assignment and Assumption

A Lender shall not be required to make any such assignment or delegation if,
prior thereto, as a result of a waiver by such Lender or otherwise, the
circumstances entitling Carpenter to require such assignment and delegation
cease to apply.

11.14 Governing Law; Jurisdiction; Etc.

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

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

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

 

101

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

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

(d) SERVICE OF PROCESS. EACH PARTY HERETO IRREVOCABLY CONSENTS TO SERVICE OF
PROCESS IN THE MANNER PROVIDED FOR NOTICES IN SECTION 11.02. NOTHING IN THIS
AGREEMENT WILL AFFECT THE RIGHT OF ANY PARTY HERETO TO SERVE PROCESS IN ANY
OTHER MANNER PERMITTED BY APPLICABLE LAW.

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

11.16 No Advisory or Fiduciary Responsibility. In connection with all aspects of
each transaction contemplated hereby (including in connection with any
amendment, waiver or other modification hereof or of any other Loan Document),
each Borrower acknowledges and agrees, and acknowledges its Affiliates’
understanding, that: (i) (A) the arranging and other services regarding this
Agreement provided by the Administrative Agent and the Arrangers are
arm’s-length commercial transactions between such Borrower and its Affiliates,
on the one hand, and the Administrative Agent and the Arrangers, on the other
hand, (B) such Borrower has consulted its own legal, accounting, regulatory and
tax advisors to the extent it has deemed appropriate, and (C) such Borrower is
capable of evaluating, and understands and accepts, the terms, risks and
conditions of the transactions contemplated hereby and by the other Loan
Documents; (ii) (A) the Administrative Agent and each Arranger each 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 such Borrower or any of its Affiliates, or any
other Person and (B) neither the Administrative Agent nor any Arranger has any
obligation to such Borrower or any of its Affiliates with respect to the
transactions contemplated hereby except those obligations expressly set forth
herein and in the other Loan Documents; and (iii) the Administrative Agent and
the Arrangers and their respective Affiliates may be engaged in a broad range of
transactions that involve interests that differ from those of such Borrower and
its Affiliates, and neither the Administrative Agent nor any Arranger has any
obligation to disclose any of such interests to Carpenter or its Affiliates. To
the fullest extent permitted by law, each of the Borrowers hereby waives and
releases any claims that it may have against the Administrative Agent and the
Arrangers with respect to any breach or alleged breach of agency or fiduciary
duty in connection with any aspect of any transaction contemplated hereby.

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

 

102

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

11.18 USA PATRIOT Act. Each Lender that is subject to the Patriot Act (as
hereinafter defined) and the Administrative Agent (for itself and not on behalf
of any Lender) hereby notifies the Borrowers that pursuant to the requirements
of the USA PATRIOT Act (Title III of Pub. L. 107-56 (signed into law October 26,
2001)) (the “Patriot Act”), it is required to obtain, verify and record
information that identifies the Borrowers, which information includes the name
and address of each Borrower and other information that will allow such Lender
or the Administrative Agent, as applicable, to identify such Borrower in
accordance with the Patriot Act. Each Borrower shall, promptly following a
request by the Administrative Agent or any Lender, provide all documentation and
other information that the Administrative Agent or such Lender requests in order
to comply with its ongoing obligations under applicable “know your customer” and
anti-money laundering rules and regulations, including the Patriot Act.

11.19 Judgment Currency. If, for the purposes of obtaining judgment in any
court, it is necessary to convert a sum due hereunder or any other Loan Document
in one currency into another currency, the rate of exchange used shall be that
at which in accordance with normal banking procedures the Administrative Agent
could purchase the first currency with such other currency on the Business Day
preceding that on which final judgment is given. The obligation of each Borrower
in respect of any such sum due from it to the Administrative Agent or any Lender
hereunder or under the other Loan Documents shall, notwithstanding any judgment
in a currency (the “Judgment Currency”) other than that in which such sum is
denominated in accordance with the applicable provisions of this Agreement (the
“Agreement Currency”), be discharged only to the extent that on the Business Day
following receipt by the Administrative Agent or such Lender, as the case may
be, of any sum adjudged to be so due in the Judgment Currency, the
Administrative Agent or such Lender, as the case may be, may in accordance with
normal banking procedures purchase the Agreement Currency with the Judgment
Currency. If the amount of the Agreement Currency so purchased is less than the
sum originally due to the Administrative Agent or any Lender from any Borrower
in the Agreement Currency, such Borrower agrees, as a separate obligation and
notwithstanding any such judgment, to indemnify the Administrative Agent or such
Lender, as the case may be, against such loss. If the amount of the Agreement
Currency so purchased is greater than the sum originally due to the
Administrative Agent or any Lender in such currency, the Administrative Agent or
such Lender, as the case may be, agrees to return the amount of any excess to
such Borrower (or to any other Person who may be entitled thereto under
applicable law).

[Signature Pages Follow]

 

103

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

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

 

BORROWER   CARPENTER TECHNOLOGY CORPORATION   By:  

/s/ Michael A. Hajost

  Name:   Michael A. Hajost   Title:   Vice President and Treasurer

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

ADMINISTRATIVE AGENT:   BANK OF AMERICA, N.A.   By:  

/s/ Roberto O. Salazar

  Name:   Roberto O. Salazar   Title:   Vice President

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

JPMORGAN CHASE BANK, N.A.,

as a Lender

By:  

/s/ Deborah R. Winkler

Name:   Deborah R. Winkler Title:   Vice President

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

PNC BANK, NATIONAL ASSOCIATION,

as a Lender

By:  

/s/ Susan J. Dimmick

Name:   Susan J. Dimmick Title:   Senior Vice President

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

THE BANK OF TOKYO-MITSUBISHI UFJ, LTD

as a Lender

By:  

/s/ Joanne Nasuti

Name:   Joanne Nasuti Title:   Vice President

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

PNC BANK, NATIONAL ASSOCIATION,

as a Lender

By:  

/s/ Susan J. Dimmick

Name:   Susan J. Dimmick Title:   Senior Vice President

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

SOVEREIGN BANK,

as a Lender

By:  

/s/ Steven M. Weidman

Name:   Steven M. Weidman Title:   Senior Vice President

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

BRANCH BANKING AND TRUST COMPANY,

as a Lender

By:  

/s/ Glenn A. Page

Name:   Glenn A. Page Title:   Senior Vice President

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

KEYBANK NATIONAL ASSOCIATION,

as a Lender

By:  

/s/ Suzannah Harris

Name:   Suzannah Harris Title:   Vice President

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

MANUFACTURERS AND TRADERS TRUST COMPANY, as a Lender By:  

/s/ Paul Delmonte

Name:   Paul Delmonte Title:   Assistant Vice President

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

U.S. BANK NATIONAL ASSOCIATION,

as a Lender

By:  

/s/ Patrick McGraw

Name:   Patrick McGraw Title:   Vice President

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

WELLS FARGO BANK, NATIONAL ASSOCIATION, as a Lender By:  

/s/ Beth Rue

Name:   Beth Rue Title:   Director

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

EXHIBIT A

[FORM OF]

COMMITTED LOAN NOTICE

Date:             ,         

 

To: Bank of America, N.A., as Administrative Agent

Ladies and Gentlemen:

Reference is made to that certain Credit Agreement, dated as of June 21, 2011
(as amended, restated, extended, supplemented or otherwise modified in writing
from time to time, the “Agreement”; the terms defined therein being used herein
as therein defined), among Carpenter Technology Corporation, a Delaware
corporation (“Carpenter”), the Subsidiary Borrowers from time to time party
thereto, the Lenders from time to time party thereto and Bank of America, N.A.,
as Administrative Agent, Swing Line Lender and L/C Issuer.

Carpenter hereby requests, on behalf of itself or, if applicable, the Subsidiary
Borrower referenced in item 6 below (the “Applicable Subsidiary Borrower”)
(select one):

¨  A Borrowing of Committed Loans    ¨  A conversion or continuation of Loans

 

  1. On                                          (a Business Day).

 

  2. In the amount of                                         .

 

  3. Comprised of                                         .

[Type of Committed Loan requested]

 

  4.

In the following currency1:                                           

 

  5. For Eurocurrency Rate Loans: with an Interest Period of      months.

 

  6. On behalf of                                          [insert name of
applicable Subsidiary Borrower].

The Committed Borrowing, if any, requested herein complies with Section 2.01 of
the Agreement.

 

CARPENTER TECHNOLOGY CORPORATION

By:

Name:

Title:

 

1 

Such currency shall be either in Dollars or an Alternative Currency to the
extent the Loans requested herein may be made in such currency in accordance
with the Agreement.

 

A-1

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

EXHIBIT B-1

[FORM OF]

BID REQUEST

 

To: Each of the Lenders under the Credit Agreement referred to below

With a copy to: Bank of America, N.A., as Administrative Agent

Ladies and Gentlemen:

Reference is made to that certain Credit Agreement, dated as of June 21, 2011
(as amended, restated, extended, supplemented or otherwise modified in writing
from time to time, the “Agreement”; the terms defined therein being used herein
as therein defined), among Carpenter Technology Corporation, a Delaware
corporation (“Carpenter”), the Subsidiary Borrowers from time to time party
thereto, the Lenders from time to time party thereto and Bank of America, N.A.,
as Administrative Agent, Swing Line Lender and L/C Issuer.

The Lenders are invited to make Bid Loans:

 

  1. On                                          (a Business Day).

 

  2. In an aggregate amount not exceeding $                      (with any
sublimits set forth below).

 

  3. Comprised of (select one):

¨  Bid Loans based on an Absolute Rate        ¨  Bid Loans based on the
Eurocurrency Base Rate

 

  4.

In the following currency2:                                           

 

  5. For Eurocurrency Rate Loans: with an Interest Period of      months.

The Bid Borrowing requested herein complies with Section 2.03 of the Agreement.

Responses by the Lenders must be in substantially the form of Exhibit B-2 to the
Agreement and must be received by Carpenter by the time specified in
Section 2.03 of the Agreement for submitting Competitive Bids.

 

CARPENTER TECHNOLOGY CORPORATION

By:

Name:

Title:

 

2 

Such currency shall be either in Dollars or an Alternative Currency to the
extent the Loans requested herein may be made in such currency in accordance
with the Agreement.

 

B-1-1

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

EXHIBIT B-2

[FORM OF]

COMPETITIVE BID

             ,         

 

To: Carpenter Technology Corporation

With a copy to: Bank of America, N.A., as Administrative Agent

Ladies and Gentlemen:

Reference is made to that certain Credit Agreement, dated as of June 21, 2011
(as amended, restated, extended, supplemented or otherwise modified in writing
from time to time, the “Agreement”; the terms defined therein being used herein
as therein defined), among Carpenter Technology Corporation, a Delaware
corporation (“Carpenter”), the Subsidiary Borrowers from time to time party
thereto, the Lenders from time to time party thereto and Bank of America, N.A.,
as Administrative Agent, Swing Line Lender and L/C Issuer.

In response to the Bid Request dated             ,         , the undersigned
offers to make the following Bid Loan(s) in [insert currency requested]:

 

  1. Borrowing date:                                          (a Business Day).

 

  2. In an aggregate amount not exceeding $                      (with any
sublimits set forth below).

 

  3. Comprised of:

 

Bid Loan No.

   Interest Period offered    Bid Maximum      Absolute Rate
Bid or  Eurocurrency
Margin Bid*  

1

               days/mos    $                      (-  +)             % 

2

               days/mos    $                      (-  +)             % 

3

               days/mos    $                      (-  +)             % 

 

* Expressed in multiples of 1/100th of a basis point.

 

B-2-1

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

Contact Person:                      Telephone:                     

 

[LENDER] By: Name: Title:

*************************************************************************************

THIS SECTION IS TO BE COMPLETED BY CARPENTER IF IT WISHES TO ACCEPT ANY

OFFERS CONTAINED IN THIS COMPETITIVE BID.

The offers made above are hereby accepted in the amounts set forth below:

 

Bid Loan No.

   Principal Amount Accepted      $                    $                    $
               

 

CARPENTER TECHNOLOGY CORPORATION By:  

 

Name:  

 

Title:  

 

Date:  

 

 

B-2-2

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

EXHIBIT C

[FORM OF]

SWING LINE LOAN NOTICE

Date:             ,         

 

To: Bank of America, N.A., as Swing Line Lender

Bank of America, N.A., as Administrative Agent

Ladies and Gentlemen:

Reference is made to that certain Credit Agreement, dated as of June 21, 2011
(as amended, restated, extended, supplemented or otherwise modified in writing
from time to time, the “Agreement”; the terms defined therein being used herein
as therein defined), among Carpenter Technology Corporation, a Delaware
corporation (“Carpenter”), the Subsidiary Borrowers from time to time party
thereto, the Lenders from time to time party thereto and Bank of America, N.A.,
as Administrative Agent, Swing Line Lender and L/C Issuer.

The undersigned hereby requests a Swing Line Loan:

 

  1. On                                      (a Business Day).

 

  2. In the amount of $                     .

The Swing Line Borrowing requested herein complies with Section 2.05 of the
Agreement.

 

CARPENTER TECHNOLOGY CORPORATION By: Name: Title:

 

C-1

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

EXHIBIT D

[FORM OF]

NOTE

                     ____________________

FOR VALUE RECEIVED, each of the Borrowers hereby promises to pay to
                     or registered assigns (the “Lender”), in accordance with
the provisions of the Agreement (as hereinafter defined), the principal amount
of each Loan from time to time made by the Lender to the Borrowers under that
certain Credit Agreement, dated as of June 21, 2011 (as amended, restated,
extended, supplemented or otherwise modified in writing from time to time, the
“Agreement”; the terms defined therein being used herein as therein defined),
among Carpenter, the Subsidiary Borrowers from time to time party thereto, the
Lenders from time to time party thereto and Bank of America, N.A., as
Administrative Agent, Swing Line Lender and L/C Issuer.

Each Borrower promises to pay interest on the unpaid principal amount of each
Loan from the date of such Loan until such principal amount is paid in full, at
such interest rates and at such times as provided in the Agreement. Except as
otherwise provided in Section 2.05(f) of the Agreement with respect to Swing
Line Loans, all payments of principal and interest shall be made to the
Administrative Agent for the account of the Lender in the currency in which such
Committed Loan was denominated and in Same Day Funds at the Administrative
Agent’s Office for such currency. If any amount is not paid in full when due
hereunder, such unpaid amount shall bear interest, to be paid upon demand, from
the due date thereof until the date of actual payment (and before as well as
after judgment) computed at the per annum rate set forth in the Agreement.

This Note is one of the Notes referred to in the Agreement, is entitled to the
benefits thereof and may be prepaid and reborrowed in whole or in part subject
to the terms and conditions provided therein. This Note is also entitled to the
benefits of the Continuing Guaranty of Carpenter under Article X of the
Agreement. Upon the occurrence and continuation of one or more of the Events of
Default specified in the Agreement, all amounts then remaining unpaid on this
Note shall become, or may be declared to be, immediately due and payable all as
provided in the Agreement. Loans made by the Lender shall be evidenced by one or
more loan accounts or records maintained by the Lender in the ordinary course of
business. The Lender may also attach schedules to this Note and endorse thereon
the date, amount, currency and maturity of its Loans and payments with respect
thereto.

Each Borrower, for itself, its successors and assigns, hereby waives diligence,
presentment, protest and demand and notice of protest, demand, dishonor and
non-payment of this Note.

[Signature Page Follows]

 

D-1

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

THIS NOTE AND ANY CLAIMS, CONTROVERSIES, DISPUTES OR CAUSES OF ACTION (WHETHER
IN CONTRACT, TORT OR OTHERWISE) BASED UPON, ARISING OUT OF OR RELATING TO THIS
NOTE AND THE TRANSACTIONS CONTEMPLATED HEREBY SHALL BE GOVERNED BY AND CONSTRUED
IN ACCORDANCE WITH THE LAW OF THE STATE OF NEW YORK (WITHOUT REGARD TO CONFLICT
OF LAWS PRINCIPLES THAT WOULD REQUIRE THE APPLICATION OF ANOTHER STATE’S LAW).

 

CARPENTER TECHNOLOGY CORPORATION By:   Name:   Title:   [ADDITIONAL SUBSIDIARY
BORROWERS]3 By:  

 

Name:  

 

Title:  

 

 

3 

If any added pursuant to Section 2.15 of the Agreement.

 

D-2

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

LOANS AND PAYMENTS WITH RESPECT THERETO

 

Date   Type of
Loan
Made     Currency
and
Amount
of Loan
Made     End of
Interest
Period     Amount
of
Principal
or
Interest
Paid This
Date     Outstanding
Principal
Balance
This Date     Notation
Made By                                                                        
                                                                               
                                                                               
                                                                               
                                                                               
                                                                               
                                                                               
                                                                               
                                                                               
                                 

 

D-3

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

EXHIBIT E

[FORM OF]

COMPLIANCE CERTIFICATE

Financial Statement Date:             ,

 

To: Bank of America, N.A., as Administrative Agent

Ladies and Gentlemen:

Reference is made to that certain Credit Agreement, dated as of June 21, 2011
(as amended, restated, extended, supplemented or otherwise modified in writing
from time to time, the “Agreement”; the terms defined therein being used herein
as therein defined), among Carpenter Technology Corporation, a Delaware
corporation (“Carpenter”), the Subsidiary Borrowers from time to time party
thereto, the Lenders from time to time party thereto and Bank of America, N.A.,
as Administrative Agent, Swing Line Lender and L/C Issuer.

The undersigned hereby certifies as of the date hereof that he/she is the [chief
executive officer] [chief financial officer] [treasurer] [controller] of
Carpenter, and that, as such, he/she is authorized to execute and deliver this
Certificate to the Administrative Agent on behalf of Carpenter, and that:

[Use following paragraph 1 for fiscal year-end financial statements]

1. Carpenter has delivered the year-end audited financial statements required by
Section 6.01(a) of the Agreement for the fiscal year of Carpenter ended as of
the above date, together with the report and opinion of an independent certified
public accountant required by such section.

[Use following paragraph 1 for fiscal quarter-end financial statements]

1. Carpenter has delivered the unaudited financial statements required by
Section 6.01(b) of the Agreement for the fiscal quarter of Carpenter ended as of
the above date. Such financial statements fairly present the financial
condition, results of operations and cash flows of Carpenter and its
Consolidated Subsidiaries in accordance with GAAP as at such date and for such
period, subject only to normal year-end audit adjustments and the absence of
footnotes.

2. The undersigned has reviewed and is familiar with the terms of the Agreement
and has made, or has caused to be made under his/her supervision, a detailed
review of the transactions and condition (financial or otherwise) of Carpenter
during the accounting period covered by such financial statements.

3. A review of the activities of Carpenter during such fiscal period has been
made under the supervision of the undersigned with a view to determining whether
during such fiscal period Carpenter performed and observed all its Obligations
under the Loan Documents, and

[select one:]

[to the knowledge of the undersigned, during such fiscal period Carpenter
performed and observed each covenant and condition of the Loan Documents
applicable to it, and no Default has occurred and is continuing.]

 

E-1

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

—or—

[to the knowledge of the undersigned, during such fiscal period the following
covenants or conditions have not been performed or observed and the following is
a list of each such Default and its nature and status:]

4. The representations and warranties of the Borrowers contained in (i) Article
V of the Agreement and (ii) each other Loan Document or in any document
furnished at any time under or in connection with the Loan Documents, are true
and correct in all material respects (unless such representation and warranty is
subject to a materiality or Material Adverse Effect qualifier in which case it
will be true and correct in all material respects) on and as of the date hereof,
except to the extent that such representations and warranties specifically refer
to an earlier date, in which case they are true and correct as of such earlier
date, and except that for purposes of this Compliance Certificate, the
representations and warranties contained in subsections (a) and (b) of
Section 5.05 of the Agreement shall be deemed to refer to the most recent
statements furnished pursuant to clauses (a) and (b), respectively, of
Section 6.01 of the Agreement, including the statements in connection with which
this Compliance Certificate is delivered.

5. The financial covenant analyses and information set forth on Schedules 1 and
2 attached hereto are true and accurate on and as of the date of this
Certificate.

6. Since [            , 20    ], the date of the most recent financial
statements delivered to the Administrative Agent in accordance with Section 6.01
of the Agreement,

[select one:]

[there has been no material change in GAAP as applied in the preparation of the
financial statements of Carpenter and its Consolidated Subsidiaries.]

—or—

[there have been material changes in GAAP as applied in the preparation of the
financial statements of Carpenter and its Consolidated Subsidiaries, and such
changes are described below:]

IN WITNESS WHEREOF, the undersigned has executed this Certificate as of
            ,         .

 

CARPENTER TECHNOLOGY CORPORATION By: Name: Title:

 

E-2

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

SCHEDULE 1

to the Compliance Certificate

($ in 000’s)

For the Quarter/Year ended                      (“Statement Date”)

 

I. Section 7.12(a) – Interest Coverage Ratio

 

A.

  Consolidated EBITDA for four consecutive fiscal quarters ending on above date
(“Subject Period”) (See Schedule 2):    $                

B.

  Consolidated Interest Expense for Subject Period:    $                

C.

  Interest Coverage Ratio (Line I.A ÷ Line I.B):                   to 1   

Minimum required:

 

Four Fiscal Quarters Ending

  

Minimum Interest Coverage Ratio

Closing Date through
September 30, 2011

   3.25 to 1.00

December 31, 2011 and
thereafter

   3.50 to 1.00

 

II. Section 7.12(b) – Debt to Capital Ratio

 

A.

  Consolidated Indebtedness at Statement Date:    $                           

B.

  Consolidated Capitalization at Statement Date:     

1.      Consolidated Indebtedness:

   $                  

2.      Consolidated stockholders’ equity:

   $                  

3.      Consolidated Capitalization (Line II.B.1 + Line II.B.2):

   $                

C.

  Debt to Capital Ratio (Line II.A ÷ Line II.B.3):                   % 

Maximum permitted:    55%

 

E-3

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

SCHEDULE 2

to the Compliance Certificate

($ in 000’s)

For the Quarter/Year ended                      (“Statement Date”)

Consolidated EBITDA

(in accordance with the definition of Consolidated EBITDA

as set forth in the Agreement)

 

Consolidated EBITDA

   Quarter
Ended      Quarter
Ended      Quarter
Ended      Quarter
Ended      Twelve
Months Ended  

Consolidated Net Income

              

+ Consolidated Interest Expense

              

+ income taxes

              

+ depreciation expense

              

+ amortization expense

              

+ non-cash expenses

              

- non-cash retiree medical expenses

              

- non-cash Pension Plan income or expense

              

= Consolidated EBITDA

              

 

E-4

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

EXHIBIT F-1

[FORM OF]

ASSIGNMENT AND ASSUMPTION

This Assignment and Assumption (this “Assignment and Assumption”) is dated as of
the Effective Date set forth below and is entered into by and between [Insert
name of Assignor] (the “Assignor”) and the parties identified on the Schedules
hereto and [the] [each]4 Assignee identified on the Schedules hereto as
“Assignee” or as “Assignees” (collectively, the “Assignees” and each an
“Assignee”). [It is understood and agreed that the rights and obligations of
[the Assignees] [the Assignors]5 hereunder are several and not joint.]6
Capitalized terms used but not defined herein shall have the meanings given to
them in the Credit Agreement identified below (the “Agreement”), receipt of a
copy of which is hereby acknowledged by the Assignee. The Standard Terms and
Conditions set forth in Annex 1 attached hereto are hereby agreed to and
incorporated herein by reference and made a part of this Assignment and
Assumption as if set forth herein in full.

For an agreed consideration, the Assignor hereby irrevocably sells and assigns
to [the Assignee] [the respective Assignees], and [the] [each] Assignee hereby
irrevocably purchases and assumes from the Assignor, subject to and in
accordance with the Standard Terms and Conditions and the Agreement, as of the
Effective Date inserted by the Administrative Agent as contemplated below
(i) all of the Assignor’s rights and obligations in its capacity as a Lender
under the Agreement and any other documents or instruments delivered pursuant
thereto to the extent related to the amount and percentage interest identified
below of all of such outstanding rights and obligations of the Assignor under
the respective facilities identified below (including, without limitation, the
Letters of Credit and the Swing Line Loans included in such facilities) and
(ii) to the extent permitted to be assigned under applicable law, all claims,
suits, causes of action and any other right of the Assignor (in its capacity as
a Lender) against any Person, whether known or unknown, arising under or in
connection with the Agreement, any other documents or instruments delivered
pursuant thereto or the loan transactions governed thereby or in any way based
on or related to any of the foregoing, including, but not limited to, contract
claims, tort claims, malpractice claims, statutory claims and all other claims
at law or in equity related to the rights and obligations sold and assigned
pursuant to clause (i) above (the rights and obligations sold and assigned by
the Assignor to [the] [any] Assignee pursuant to clauses (i) and (ii) above
being referred to herein collectively as [the] [an] “Assigned Interest”). Each
such sale and assignment is without recourse to the Assignor and, except as
expressly provided in this Assignment and Assumption, without representation or
warranty by the Assignor.

 

1. Assignor: _                                        

 

2. Assignee(s): See Schedules attached hereto

 

3. Borrower(s): Carpenter Technology Corporation, [Identify other Subsidiary
Borrowers as of the Effective Date]

 

4. Administrative Agent: Bank of America, N.A., as the administrative agent
under the Agreement

 

4 

For bracketed language here and elsewhere in this form relating to the
Assignee(s), if the assignment is to a single Assignee, choose the first
bracketed language. If the assignment is to multiple Assignees, choose the
second bracketed language.

5 

Select as appropriate.

6 

Include bracketed language if there are either multiple Assignors or multiple
Assignees.

 

F-1-1

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

5. Credit Agreement: Credit Agreement, dated as of June 21, 2011 among Carpenter
Technology Corporation, the Subsidiary Borrowers from time to time party
thereto, the Lenders from time to time party thereto and Bank of America, N.A.,
as Administrative Agent, Swing Line Lender and L/C Issuer

 

6. Assigned Interest: See schedules attached hereto

 

[7.

Trade Date:                     ]7

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

[Remainder of the page intentionally left blank]

 

7 

To be completed if the Assignor and the Assignee intend that the minimum
assignment amount is to be determined as of the Trade Date.

 

F-1-2

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

The terms set forth in this Assignment and Assumption are hereby agreed to:

 

ASSIGNOR [NAME OF ASSIGNOR] By:  

 

  Title: ASSIGNEE: See schedules attached hereto

 

[Consented to and]8 Accepted:

BANK OF AMERICA, N.A., as Administrative Agent

By:  

 

  Title:

Consented to:

[BANK OF AMERICA, N.A.]9, as

[L/C Issuer] [and] [Swing Line Lender]

By:  

 

  Title:

[Consented to:]10

 

[CARPENTER TECHNOLOGY CORPORATION]

By:  

 

  Title:

 

8 

To be added only if the consent of the Administrative Agent is required by the
terms of the Credit Agreement.

9 

To be modified if a different L/C Issuer and/or Swing Line Lender exists at the
time of assignment.

10 

To be added only if the consent of Carpenter and/or other parties is required by
the terms of the Credit Agreement.

 

F-1-3

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

SCHEDULE 1

To Assignment and Assumption

By its execution of this Schedule, the Assignee identified on the signature
block below agrees to the terms set forth in the attached Assignment and
Assumption.

Assigned Interests:

 

Assignor

   Assignee(s)11      Facility
Assigned      Aggregate Amount
of Commitment
for all Lenders12      Amount of
Commitment
Assigned      Percentage
Assigned of
Commitment13     CUSIP
Number            $                    $                                   %   
                                            $                    $             
                     %                                                $
                   $                                   %                       
              

 

11 

Indicate [Affiliate][Approved Fund] of [identify Lender], if applicable.

12 

Amounts in this column and in the column immediately to the right to be adjusted
by the counterparties to take into account any payments or prepayments made
between the Trade Date and the Effective Date.

13 

Set forth, to at least 9 decimals, as a percentage of the Commitment of all
Lenders thereunder.

 

F-1-4

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

ANNEX 1 TO ASSIGNMENT AND ASSUMPTION

CREDIT AGREEMENT dated as of June 21, 2011 among CARPENTER TECHNOLOGY
CORPORATION, the Subsidiary Borrowers from time to time party thereto, the
Lenders party thereto and BANK OF AMERICA, N.A., as Administrative Agent, Swing
Line Lender and L/C Issuer

STANDARD TERMS AND CONDITIONS FOR

ASSIGNMENT AND ASSUMPTION

1. Representations and Warranties.

1.1. Assignor. The Assignor (a) represents and warrants that (i) it is the legal
and beneficial owner of the Assigned Interest, (ii) the Assigned Interest is
free and clear of any lien, encumbrance or other adverse claim and (iii) it has
full power and authority, and has taken all action necessary, to execute and
deliver this Assignment and Assumption and to consummate the transactions
contemplated hereby; and (b) except as set forth herein, assumes no
responsibility with respect to (i) any statements, warranties or representations
made in or in connection with the Agreement or any other Loan Document, (ii) the
execution, legality, validity, enforceability, genuineness, sufficiency or value
of the Loan Documents or any collateral thereunder, (iii) the financial
condition of Carpenter, any of its Subsidiaries or Affiliates or any other
Person obligated in respect of any Loan Document or (iv) the performance or
observance by Carpenter, any of its Subsidiaries or Affiliates or any other
Person of any of their respective obligations under any Loan Document.

1.2. Assignee[s]. [The] [Each] Assignee (a) represents and warrants that (i) it
has full power and authority, and has taken all action necessary, to execute and
deliver this Assignment and Assumption and to consummate the transactions
contemplated hereby and to become a Lender under the Agreement, (ii) it meets
all the requirements to be an assignee under Section 11.06 of the Agreement
(subject to such consents, if any, as may be required under Section 11.06 of the
Agreement), (iii) from and after the Effective Date, it shall be bound by the
provisions of the Agreement as a Lender thereunder and, to the extent of [the]
[the relevant] Assigned Interest, shall have the obligations of a Lender
thereunder, (iv) it is sophisticated with respect to decisions to acquire assets
of the type represented by the Assigned Interest and either it, or the Person
exercising discretion in making its decision to acquire the Assigned Interest,
is experienced in acquiring assets of such type, (v) it has received a copy of
the Agreement, and has received or has been accorded the opportunity to receive
copies of the most recent financial statements delivered pursuant to
Section 6.01 thereof, as applicable, and such other documents and information as
it deems appropriate to make its own credit analysis and decision to enter into
this Assignment and Assumption and to purchase [the] [such] Assigned Interest,
(vi) it has, independently and without reliance upon the Administrative Agent or
any other Lender and based on such documents and information as it has deemed
appropriate, made its own credit analysis and decision to enter into this
Assignment and Assumption and to purchase [the] [such] Assigned Interest, and
(vii) if it is a Foreign Lender, attached hereto is any documentation required
to be delivered by it pursuant to the terms of the Agreement, duly completed and
executed by the Assignee; and (b) agrees that (i) it will, independently and
without reliance upon the Administrative Agent, [the] [any] Assignor or any
other Lender, and based on such documents and information as it shall deem
appropriate at the time, continue to make its own credit decisions in taking or
not taking action under the Loan Documents, and (ii) it will perform in
accordance with their terms all of the obligations which by the terms of the
Loan Documents are required to be performed by it as a Lender.

2. Payments. From and after the Effective Date, the Administrative Agent shall
make all payments in respect of [the] [each] Assigned Interest (including
payments of principal, interest, fees and other amounts) to the Assignor for
amounts which have accrued to but excluding the Effective Date and to [the]
[each] Assignee for amounts which have accrued from and after the Effective
Date.

 

F-1-5

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

3. General Provisions. This Assignment and Assumption shall be binding upon, and
inure to the benefit of, the parties hereto and their respective successors and
assigns. This Assignment and Assumption may be executed in any number of
counterparts, which together shall constitute one instrument. Delivery of an
executed counterpart of a signature page of this Assignment and Assumption by
telecopy shall be effective as delivery of a manually executed counterpart of
this Assignment and Assumption. This Assignment and Assumption shall be governed
by, and construed in accordance with, the law of the State of New York.

 

F-1-6

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

EXHIBIT F-2

[FORM OF]

ADMINISTRATIVE QUESTIONNAIRE

[See Attached]

 

F-2-1

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

EXHIBIT G

[FORM OF]

SUBSIDIARY BORROWER

REQUEST AND ASSUMPTION AGREEMENT

Date:                     ,         

 

To: Bank of America, N.A., as Administrative Agent

Ladies and Gentlemen:

This Subsidiary Borrower Request and Assumption Agreement is made and delivered
pursuant to Section 2.15 of that certain Credit Agreement, dated as of June 21,
2011 (as amended, restated, extended, supplemented or otherwise modified in
writing from time to time, the “Credit Agreement”), among Carpenter Technology
Corporation, a Delaware corporation (“Carpenter”), the Subsidiary Borrowers from
time to time party thereto, the Lenders from time to time party thereto and Bank
of America, N.A., as Administrative Agent, Swing Line Lender and L/C Issuer, and
reference is made thereto for full particulars of the matters described therein.
All capitalized terms used in this Subsidiary Borrower Request and Assumption
Agreement and not otherwise defined herein shall have the meanings assigned to
them in the Credit Agreement.

Each of                                          (the “Subsidiary Borrower”) and
Carpenter hereby confirms, represents and warrants to the Administrative Agent
and the Lenders that the Subsidiary Borrower is a Subsidiary of Carpenter.

The documents required to be delivered to the Administrative Agent under
Section 2.15 of the Credit Agreement will be furnished to the Administrative
Agent in accordance with the requirements of the Credit Agreement.

Complete if the Subsidiary Borrower is a Domestic Subsidiary: The true and
correct U.S. taxpayer identification number of the Subsidiary Borrower is
                    .

Complete if the Subsidiary Borrower is a Foreign Subsidiary: The true and
correct unique identification number that has been issued to the Subsidiary
Borrower by its jurisdiction of organization and the name of such jurisdiction
are set forth below:

 

Identification Number

  

Jurisdiction of Organization

     

The parties hereto hereby confirm that with effect from the date of the
Subsidiary Borrower Notice for the Subsidiary Borrower, the Subsidiary Borrower
shall have obligations, duties and liabilities toward each of the other parties
to the Credit Agreement identical to those which the Subsidiary Borrower would
have had if the Subsidiary Borrower had been an original party to the Credit
Agreement as a Borrower. Effective as of the date of the Subsidiary Borrower
Notice for the Subsidiary Borrower, the Subsidiary Borrower confirms its
acceptance of, and consents to, all representations and warranties, covenants,
and other terms and provisions of the Credit Agreement.

The parties hereto hereby request that the Subsidiary Borrower be entitled to
receive Loans under the Credit Agreement, and understand, acknowledge and agree
that neither the Subsidiary Borrower nor

 

G-1

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

Carpenter on its behalf shall have any right to request any Loans for its
account until the effective date designated by the Administrative Agent in a
Subsidiary Borrower Notice delivered to Carpenter and the Lenders pursuant to
Section 2.15 of the Credit Agreement.

This Subsidiary Borrower Request and Assumption Agreement shall constitute a
Loan Document under the Credit Agreement.

THIS SUBSIDIARY BORROWER REQUEST AND ASSUMPTION AGREEMENT SHALL BE GOVERNED BY,
AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.

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

 

[SUBSIDIARY BORROWER] By:  

 

Title:  

 

CARPENTER TECHNOLOGY CORPORATION By:   Title:  

 

G-2

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

EXHIBIT H

[FORM OF]

SUBSIDIARY BORROWER NOTICE

Date:                     ,         

 

To: Carpenter Technology Corporation

The Lenders party to the Credit Agreement referred to below

Ladies and Gentlemen:

This Subsidiary Borrower Notice is made and delivered pursuant to Section 2.15
of that certain Credit Agreement, dated as of June 21, 2011 (as amended,
restated, extended, supplemented or otherwise modified in writing from time to
time, the “Credit Agreement”), among Carpenter Technology Corporation, a
Delaware corporation (“Carpenter”), the Subsidiary Borrowers from time to time
party thereto, the Lenders from time to time party thereto and Bank of America,
N.A., as Administrative Agent, Swing Line Lender and L/C Issuer, and reference
is made thereto for full particulars of the matters described therein. All
capitalized terms used in this Subsidiary Borrower Notice and not otherwise
defined herein shall have the meanings assigned to them in the Credit Agreement.

The Administrative Agent hereby notifies Carpenter and the Lenders that
effective as of the date hereof [                                        ] shall
be a Subsidiary Borrower and may receive Loans for its account on the terms and
conditions set forth in the Credit Agreement.

This Subsidiary Borrower Notice shall constitute a Loan Document under the
Credit Agreement.

 

BANK OF AMERICA, N.A., as Administrative Agent By:  

 

Title:  

 

 

H-1