Exhibit 10.1

Execution Version

Published CUSIP Number: 07783AAD7

Revolving Credit Facility CUSIP Number: 07783AAE5

 

 

 

$500,000,000

FOURTH AMENDED AND RESTATED CREDIT AGREEMENT

dated as of October 22, 2014,

by and among

BELK, INC.,

and the Subsidiaries of Belk, Inc. party hereto,

as Borrowers,

the Lenders referred to herein,

WELLS FARGO BANK, NATIONAL ASSOCIATION,

as Administrative Agent,

BANK OF AMERICA, N.A. and

BRANCH BANKING AND TRUST COMPANY,

as Co-Syndication Agents,

PNC BANK, NATIONAL ASSOCIATION,

REGIONS BANK and

U.S. BANK NATIONAL ASSOCIATION,

as Documentation Agents

and

WELLS FARGO SECURITIES, LLC,

MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED and

BB&T CAPITAL MARKETS,

as Joint Lead Arrangers and Joint Bookrunners

 

 

 

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TABLE OF CONTENTS

 

          Page   ARTICLE I    DEFINITIONS    Section 1.1    Definitions      1
  

Section 1.2

   Other Definitions and Provisions      19    ARTICLE II    REVOLVING CREDIT
FACILITY    Section 2.1    Revolving Credit Loans      20    Section 2.2   
Swingline Loans      21    Section 2.3    Procedure for Advances of Revolving
Credit and Swingline Loans      22    Section 2.4    Repayment of Loans      23
   Section 2.5    Notes      24    Section 2.6    Permanent Reduction of the
Revolving Credit Commitment      25    Section 2.7    Increase of Revolving
Credit Commitment      25    Section 2.8    Joint and Several Liability of
Borrowers      27    Section 2.9    Appointment of the Company      30   
ARTICLE III    LETTER OF CREDIT FACILITY    Section 3.1    L/C Commitments     
30    Section 3.2    Procedure for Issuance of Letters of Credit      32   
Section 3.3    Fees and Other Charges      32    Section 3.4    L/C
Participations      33    Section 3.5    Reimbursement Obligation of the
Borrowers      34    Section 3.6    Obligations Absolute      34    Section 3.7
   Effect of Application      35    ARTICLE IV    GENERAL LOAN PROVISIONS   
Section 4.1    Interest      35    Section 4.2    Notice and Manner of
Conversion or Continuation of Loans      38    Section 4.3    Fees      38   
Section 4.4    Manner of Payment      39    Section 4.5    Crediting of Payments
and Proceeds      40    Section 4.6    Adjustments      40   

 

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TABLE OF CONTENTS

(continued)

 

          Page   Section 4.7    Nature of Obligations of Lenders Regarding
Extensions of Credit; Assumption by the Administrative Agent      41   
Section 4.8    Changed Circumstances      42    Section 4.9    Indemnity      43
   Section 4.10    Capital Requirements      44    Section 4.11    Taxes      44
   Section 4.12    Mitigation Obligations; Replacement of Lenders      47   
Section 4.13    Defaulting Lenders      48    ARTICLE V    CLOSING; CONDITIONS
OF CLOSING AND BORROWING    Section 5.1    Conditions to Closing and Initial
Extensions of Credit      50    Section 5.2    Conditions to All Extensions of
Credit      53    ARTICLE VI    REPRESENTATIONS AND WARRANTIES OF THE BORROWERS
   Section 6.1    Representations and Warranties      53    Section 6.2   
Survival of Representations and Warranties, Etc      61    ARTICLE VII   
FINANCIAL INFORMATION AND NOTICES    Section 7.1    Financial Statements and
Projections      61    Section 7.2    Officer’s Compliance Certificate      62
   Section 7.3    Accountants’ Certificate      62    Section 7.4    Other
Reports      62    Section 7.5    Notice of Litigation and Other Matters      62
   Section 7.6    Accuracy of Information      63    ARTICLE VIII    AFFIRMATIVE
COVENANTS    Section 8.1    Preservation of Corporate Existence and Related
Matters      64    Section 8.2    Maintenance of Property      64    Section 8.3
   Insurance      64    Section 8.4    Accounting Methods and Financial Records
     64    Section 8.5    Payment and Performance of Obligations      64   
Section 8.6    Compliance With Laws and Approvals      64   

 

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TABLE OF CONTENTS

(continued)

 

          Page   Section 8.7    Environmental Laws      65    Section 8.8   
Compliance with ERISA      65    Section 8.9    Compliance With Agreements     
65    Section 8.10    Visits and Inspections      65    Section 8.11   
Additional Subsidiaries      66    Section 8.12    Use of Proceeds      66   
Section 8.13    Additional Borrowers      66    Section 8.14    Anti-Corruption
Laws; OFAC      66    Section 8.15    Further Assurances      66    ARTICLE IX
   FINANCIAL COVENANTS    Section 9.1    Leverage Ratio      67    Section 9.2
   Fixed Charge Coverage Ratio      67    ARTICLE X    NEGATIVE COVENANTS   
Section 10.1    Limitations on Debt      67    Section 10.2    Limitations on
Liens      68    Section 10.3    Limitations on Loans, Advances, Investments and
Acquisitions      69    Section 10.4    Limitations on Mergers and Liquidation
     70    Section 10.5    Limitations on Sale of Assets      70    Section 10.6
   Limitations on Dividends and Distributions      71    Section 10.7   
Limitations on Exchange and Issuance of Capital Stock      72    Section 10.8   
Transactions with Affiliates      72    Section 10.9    Certain Accounting
Changes; Organizational Documents      72    Section 10.10    Amendments;
Payments and Prepayments of Debt      72    Section 10.11    Restrictive
Agreements      73    Section 10.12    Nature of Business      73    ARTICLE XI
   DEFAULT AND REMEDIES    Section 11.1    Events of Default      73   
Section 11.2    Remedies      75    Section 11.3    Rights and Remedies
Cumulative; Non-Waiver; etc      76   

 

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TABLE OF CONTENTS

(continued)

 

          Page   ARTICLE XII    THE ADMINISTRATIVE AGENT    Section 12.1   
Appointment      77    Section 12.2    Delegation of Duties      77    Section
12.3    Exculpatory Provisions      77    Section 12.4    Reliance by the
Administrative Agent      78    Section 12.5    Notice of Default      79   
Section 12.6    Non-Reliance on the Administrative Agent and Other Lenders     
79    Section 12.7    Indemnification      79    Section 12.8    The
Administrative Agent in Its Individual Capacity      80    Section 12.9   
Resignation of the Administrative Agent; Successor Administrative Agent      80
   Section 12.10    Other Agents      80    ARTICLE XIII    MISCELLANEOUS   
Section 13.1    Notices      81    Section 13.2    Expenses; Indemnity      82
   Section 13.3    Set-off      83    Section 13.4    Governing Law      83   
Section 13.5    Jurisdiction and Venue      83    Section 13.6    Reversal of
Payments      84    Section 13.7    Injunctive Relief; Punitive Damages      84
   Section 13.8    Accounting Matters      84    Section 13.9    Successors and
Assigns; Participations      85    Section 13.10    Amendments, Waivers and
Consents      89    Section 13.11    Performance of Duties      90    Section
13.12    All Powers Coupled with Interest      90    Section 13.13    Survival
of Indemnities      90    Section 13.14    Titles and Captions      90   
Section 13.15    Severability of Provisions      90    Section 13.16   
Counterparts; Integration      90    Section 13.17    Term of Agreement      90
   Section 13.18    Advice of Counsel      91    Section 13.19    No Strict
Construction      91    Section 13.20    Inconsistencies with Other Documents;
Independent Effect of Covenants      91    Section 13.21    Effect of Agreement
     91    Section 13.22    USA Patriot Act      91   

 

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TABLE OF CONTENTS

(continued)

 

EXHIBITS          Exhibit A-1   

–

   Form of Revolving Credit Note    Exhibit A-2   

–

   Form of Swingline Note    Exhibit B   

–

   Form of Notice of Borrowing    Exhibit C   

–

   Form of Notice of Account Designation    Exhibit D   

–

   Form of Notice of Repayment    Exhibit E   

–

   Form of Notice of Conversion/Continuation    Exhibit F   

–

   Form of Officer’s Compliance Certificate    Exhibit G   

–

   Form of Assignment and Assumption    SCHEDULES          Schedule 1.1(a)   

–

   Existing Letters of Credit    Schedule 1.1(b)   

–

   Commitments    Schedule 6.1(a)   

–

   Jurisdictions of Organization and Qualification    Schedule 6.1(b)   

–

   Subsidiaries and Capitalization    Schedule 6.1(f)   

–

   Ongoing Tax Audits    Schedule 6.1(i)   

–

   ERISA Plans    Schedule 6.1(l)   

–

   Material Contracts    Schedule 6.1(m)   

–

   Labor and Collective Bargaining Agreements    Schedule 6.1(t)   

–

   Debt and Guaranty Obligations    Schedule 6.1(u)   

–

   Litigation    Schedule 8.3   

–

   Insurance    Schedule 10.2   

–

   Existing Liens    Schedule 10.3   

–

   Existing Investments    Schedule 10.8   

–

   Transactions with Affiliates   

 

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CREDIT AGREEMENT

FOURTH AMENDED AND RESTATED CREDIT AGREEMENT, dated as of October 22, 2014, by
and among BELK, INC., a Delaware corporation (the “Company”), the Subsidiaries
of the Company listed on the signature pages hereto and each additional
Subsidiary of the Company which hereafter becomes a Borrower pursuant to
Section 8.11 (collectively, the “Subsidiary Borrowers” and together with the
Company, the “Borrowers”), the lenders who are or may become a party to this
Agreement, as Lenders, WELLS FARGO BANK, NATIONAL ASSOCIATION, as Administrative
Agent for the Lenders, and BANK OF AMERICA, N.A. and BRANCH BANKING AND TRUST
COMPANY, as Co-Syndication Agents, and PNC BANK, NATIONAL ASSOCIATION, REGIONS
BANK and U.S. BANK NATIONAL ASSOCIATION, as Documentation Agents.

STATEMENT OF PURPOSE

Certain of the Borrowers, certain financial institutions, and the Administrative
Agent executed and delivered that certain Third Amended and Restated Credit
Agreement dated as of November 23, 2010 (as amended, restated or otherwise
modified prior to the date hereof, the “Existing Credit Agreement”).

The Borrowers have requested, and, subject to the terms and conditions hereof,
the Administrative Agent and the Lenders have agreed to amend and restate the
Existing Credit Agreement on the terms and conditions of this Agreement.

NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged by the parties hereto, such parties hereby
agree that the Existing Credit Agreement is hereby amended and restated as
follows:

ARTICLE I

DEFINITIONS

Section 1.1 Definitions. The following terms when used in this Agreement shall
have the meanings assigned to them below:

“2005 Senior Notes” means the $100,000,000 5.31% Senior Notes, Series B, due
July 12, 2015 issued by the Borrowers in favor of certain purchasers pursuant to
the Note Purchase Agreement dated July 12, 2005 by and among the Borrowers and
such purchasers.

“2007 Senior Notes” means the $125,000,000 6.20% Senior Notes, due August 31,
2017, issued by the Borrowers in favor of certain purchasers pursuant to the
Note Purchase Agreement dated August 31, 2007 by and among the Borrowers and
such purchasers.

“2010 Senior Notes” means the $50,000,000 5.7% Senior Notes, due November 23,
2020, issued by the Borrowers in favor of certain purchasers pursuant to the
Note Purchase Agreement dated November 23, 2010 by and among the Borrowers and
such purchasers.

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“2011 Senior Notes” means the $100,000,000 5.21% Senior Notes, due January 25,
2022, issued by the Borrowers in favor of certain purchasers pursuant to the
Note Purchase Agreement dated December 14, 2011 by and among the Borrowers and
such purchasers.

“Additional Debt” means, with respect to any Borrower or any Subsidiary and to
the extent not included as a liability on the consolidated balance sheet of such
Borrower or Subsidiary, in accordance with GAAP, any monetary obligation
(including, without limitation, all outstanding payment, recourse, repurchase,
hold harmless, indemnity or similar obligations) with respect to any Synthetic
Lease transaction, tax retention or off-balance sheet lease transaction, asset
securitization transaction (including any accounts receivable purchase facility)
or any other monetary obligation arising with respect to any other transaction
which does not appear on the balance sheet of such Borrower or Subsidiary, but
which (i) upon the insolvency or bankruptcy of such Borrower or Subsidiary would
be characterized as debt of such Borrower or Subsidiary or (ii) is the
functional equivalent of or takes the place of borrowing.

“Adjusted Debt” means the sum of (i) Funded Debt and (ii) the product of
(x) Rental Expense and (y) eight (8).

“Administrative Agent” means Wells Fargo in its capacity as Administrative Agent
hereunder, and any successor thereto appointed pursuant to Section 12.9.

“Administrative Agent’s Office” means the office of the Administrative Agent
specified in or determined in accordance with the provisions of Section 13.1(c).

“Affiliate” means, with respect to any Person, any other Person (other than a
Borrower or a Subsidiary of a Borrower) which directly or indirectly through one
or more intermediaries, controls, or is controlled by, or is under common
control with, such first Person or any of its Subsidiaries. The term “control”
means (a) the power to vote five percent (5%) or more of the securities or other
equity interests of a Person having ordinary voting power, or (b) the
possession, directly or indirectly, of any other power to direct or cause the
direction of the management and policies of a Person, whether through ownership
of voting securities, by contract or otherwise.

“Aggregate Commitment” means the aggregate amount of the Lenders’ Revolving
Credit Commitments hereunder, as such amount may be reduced, increased or
otherwise modified at any time or from time to time pursuant to the terms
hereof. On the Closing Date, the Aggregate Commitment shall be $500,000,000.

“Aggregate L/C Commitment” means the lesser of (a) $100,000,000 and (b) the
Revolving Credit Commitment.

“Agreement” means this Fourth Amended and Restated Credit Agreement.

“Anti-Corruption Laws” means the Foreign Corrupt Practices Act and all other
federal or state laws, rules, and regulations of the United States and any
national laws, rules and regulations of any foreign country, in each case
applicable to the Borrowers and their Subsidiaries concerning or relating to
bribery or corruption.

 

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“Applicable Law” means all applicable provisions of constitutions, laws,
statutes, ordinances, rules, treaties, regulations, permits, licenses,
approvals, interpretations and orders of courts or Governmental Authorities and
all orders and decrees of all courts and arbitrators.

“Applicable Margin” shall have the meaning assigned thereto in Section 4.1(c).

“Application” means an application, in the form specified by the Issuing Lender
from time to time, requesting the Issuing Lender to Issue a Letter of Credit.

“Approved Fund” means any Person (other than a natural Person), including,
without limitation, any special purpose entity, that is (or will be) engaged in
making, purchasing, holding or otherwise investing in commercial loans and
similar extensions of credit in the ordinary course of its business; provided,
that such Approved Fund must be administered, managed or underwritten 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.

“Assignment and Assumption” shall have the meaning assigned thereto in
Section 13.9.

“Auto-Extension Letter of Credit” shall have the meaning assigned thereto in
Section 3.1(b).

“Available Revolving Credit Commitment” means, as to any Lender at any time, an
amount equal to (a) such Lender’s Revolving Credit Commitment less (b) such
Lender’s Extensions of Credit.

“Bank of America” means Bank of America, N.A.

“Base Rate” means, at any time, the highest of (a) the Prime Rate, (b) the
Federal Funds Rate plus 1/2 of 1%, and (c) the LIBOR Rate (for an Interest
Period of one month) plus 1%; each change in the Base Rate shall take effect
simultaneously with the corresponding change or changes in the Prime Rate, the
Federal Funds Rate or the LIBOR Rate.

“Base Rate Loan” means any Loan bearing interest at a rate based upon the Base
Rate as provided in Section 4.1(a).

“BB&T” means Branch Banking and Trust Company.

“Benefited Lender” shall have the meaning assigned thereto in Section 4.6.

“Borrowers” shall have the meaning assigned thereto in the preamble hereof.

“Business Day” means (a) for all purposes other than as set forth in clause
(b) below, any day other than a Saturday, Sunday or legal holiday on which banks
in Charlotte, North Carolina and New York, New York, are open for the conduct of
their commercial banking business, and (b) with respect to all notices and
determinations in connection with, and payments of principal and interest on,
any LIBOR Rate Loan, any day that is a Business Day described in clause (a) and
that is also a day for trading by and between banks in Dollar deposits in the
London interbank market.

 

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“Calculation Date” shall have the meaning assigned thereto in Section 4.1(c).

“Capital Lease” means any lease of any property by any of the Borrowers or any
of their Subsidiaries, as lessee, that should, in accordance with GAAP, be
classified and accounted for as a capital lease on a Consolidated balance sheet
of the Borrowers and their Subsidiaries.

“Cash Collateral Account” means an account established by the Borrowers with the
Administrative Agent for the benefit of the Issuing Lenders and the L/C
Participants.

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

“Cash Management Bank” means (i) any Person that, at the time it enters into a
Cash Management Agreement, is a Lender, an Affiliate of a Lender, the
Administrative Agent or an Affiliate of the Administrative Agent, in its
capacity as a party to such Cash Management Agreement with any Borrower and
(ii) any Person that, at the time it (or its Affiliate) becomes a Lender
(including on the Closing Date), is a Lender or an Affiliate of an a Lender and
is party to a Cash Management Agreement, in its capacity as party to such Cash
Management Agreement with any Borrower.

“Change in Control” shall have the meaning assigned thereto in Section 11.1(i).

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

“Closing Date” means the date of this Agreement or such later Business Day upon
which each condition described in Section 5.1 shall be satisfied or waived in
all respects in a manner acceptable to the Administrative Agent, in its sole
discretion.

“Co-Syndication Agents” means Bank of America, N.A. and BB&T in their capacities
as Co-Syndication Agents hereunder.

“Code” means the United States Internal Revenue Code of 1986.

“Commodity Exchange Act” shall mean the Commodity Exchange Act (7 U.S.C. § 1 et
seq.).

 

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“Company” shall have the meaning assigned thereto in the preamble hereof.

“Consolidated” means, when used with reference to financial statements or
financial statement items of the Borrowers and their Subsidiaries, such
statements or items on a consolidated basis in accordance with applicable
principles of consolidation under GAAP.

“Credit Facility” means, collectively, the Revolving Credit Facility, the
Swingline Facility and the L/C Facility.

“Debt” means, with respect to the Borrowers and their Subsidiaries at any date
and without duplication, the sum of the following calculated in accordance with
GAAP: (a) all Funded Debt, (b) all Additional Debt, (c) all obligations to pay
the deferred purchase price of property or services of any such Person
(including, without limitation, all obligations under non-competition
agreements), except trade payables arising in the ordinary course of business
not more than ninety (90) days past due, (d) all Debt of any other Person
secured by a Lien on any asset of any such Person, (e) all Guaranty Obligations
of any such Person, (f) all obligations, contingent or otherwise, of any such
Person relative to the face amount of letters of credit, whether or not drawn,
including, without limitation, any Reimbursement Obligation, and banker’s
acceptances issued for the account of any such Person, (g) all obligations of
any such Person to redeem, repurchase, exchange, defease or otherwise make
payments in respect of capital stock or other securities or partnership
interests of such Person and (h) all net payment obligations incurred by any
such Person pursuant to Hedging Agreements. For the avoidance of doubt,
operating leases shall not be considered Debt for purposes of this Agreement.

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

“Default” means any of the events specified in Section 11.1 which with the
passage of time, the giving of notice or any other condition, would constitute
an Event of Default.

“Defaulting Lender” means any Lender that (a) has failed to fund all or any
portion of the Revolving Credit Loans, participations in L/C Obligations or
participations in Swingline Loans required to be funded by it hereunder within
three (3) Business Days of the date required to be funded by it hereunder,
(b) has otherwise failed to pay over to the Administrative Agent, any Issuing
Lender or any other Lender any other amount required to be paid by it hereunder
within three (3) Business Days of the date when due, unless such amount is the
subject of a good faith dispute, (c) has notified the Borrower, the
Administrative Agent or any other Lender in writing that it does not intend to
comply with any of its funding obligations under this Agreement or has made a
public statement to the effect that it does not intend to comply with its
funding obligations under this Agreement, 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 FDIC 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

 

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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 any one or more of 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 4.13(g)) upon delivery of written
notice of such determination to the Company, each Issuing Lender, the Swingline
Lender and each Lender.

“Designated Person” means any Person listed on a Sanctions List.

“Documentation Agent” means each of PNC Bank, National Association, Regions Bank
and U.S. Bank National Association in their capacity as a Documentation Agent
hereunder.

“Dollars” or “$” means, unless otherwise qualified, dollars in lawful currency
of the United States.

“EBITDA” means, for any period, the sum of the following determined on a
Consolidated basis, without duplication, for the Borrowers and their
Subsidiaries in accordance with GAAP: (a) Net Income for such period plus
(b) the sum of the following to the extent deducted in determining Net Income:
(i) income and franchise taxes, (ii) Interest Expense, and (iii) amortization,
depreciation, and other non-cash charges, including those related to the closing
of store locations less (c) interest income and any extraordinary gains;
provided that for any period during which any acquisition permitted pursuant to
the terms of Section 10.3(c) is consummated, EBITDA shall be adjusted to give
effect to the consummation of any such permitted acquisition on a pro forma
basis in accordance with GAAP, as if such acquisitions occurred on the first day
of such period, including, without limitation, adjustments reflecting any
non-recurring costs, extraordinary expenses and expense savings calculated in a
manner reasonably satisfactory to the Administrative Agent.

“EBITDAR” means, for any period, the sum of the following determined on a
Consolidated basis, without duplication, for the Borrowers and their
Subsidiaries in accordance with GAAP: (a) EBITDA for such period plus (b) Rental
Expense.

“Eligible Assignee” means, with respect to any assignment of the rights,
interest and obligations of a Lender hereunder, a Person that is at the time of
such assignment (a) a commercial bank organized under the laws of the United
States or any state thereof, having combined capital and surplus in excess of
$500,000,000, (b) a commercial bank organized under the laws of any other
country that is a member of the Organization of Economic Cooperation and
Development, or a political subdivision of any such country, having combined
capital and surplus in excess of $500,000,000, (c) a finance company, insurance
company or other financial institution which in the ordinary course of business
extends credit of the type extended hereunder and that has total assets in
excess of $1,000,000,000, (d) already a Lender hereunder (whether as an original
party to this Agreement or as the assignee of another Lender), (e) the successor
(whether by transfer of assets, merger or otherwise) to all or substantially all
of the commercial

 

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lending business of the assigning Lender, (f) any Affiliate of assigning Lender,
(g) an Approved Fund, or (h) any other Person that has been approved in writing
as an Eligible Assignee by the Company (other than upon the occurrence and
during the continuance of any Default or Event of Default) and the
Administrative Agent; provided that notwithstanding the foregoing, “Eligible
Assignee” shall not include (i) any of the Borrowers or any of the Borrowers’
Affiliates or Subsidiaries, (ii) a natural Person (or a holding company,
investment vehicle or trust for, or owned and operated for the primary benefit
of, a natural Person) and (iii) any Defaulting Lender or any of its
Subsidiaries, or any Person who, upon becoming a Lender hereunder, would
constitute a Defaulting Lender or a Subsidiary thereof.

“Employee Benefit Plan” means (a) any employee benefit plan within the meaning
of Section 3(3) of ERISA that is maintained for employees of any Borrower or
(b) any Pension Plan or Multiemployer Plan that has at any time within the
preceding six (6) years been maintained, funded or administered for the
employees of any Borrower or any current or former ERISA Affiliate.

“Environmental Claims” means any and all administrative, regulatory or judicial
actions, suits, demands, demand letters, claims, liens, accusations,
allegations, notices of noncompliance or violation, investigations (other than
internal reports prepared by any Person in the ordinary course of business and
not in response to any third party action or request of any kind) or proceedings
relating in any way to any actual or alleged violation of or liability under any
Environmental Law or relating to any permit issued, or any approval given, under
any such Environmental Law, including, without limitation, any and all claims by
Governmental Authorities for enforcement, cleanup, removal, response, remedial
or other actions or damages, contribution, indemnification cost recovery,
compensation or injunctive relief resulting from Hazardous Materials or arising
from alleged injury or threat of injury to human health or the environment.

“Environmental Laws” means any and all federal, foreign, state, provincial and
local laws, statutes, ordinances, rules, regulations, permits, licenses,
approvals, interpretations and orders of courts or Governmental Authorities,
relating to the protection of human health or the environment, including, but
not limited to, requirements pertaining to the manufacture, processing,
distribution, use, treatment, storage, disposal, transportation, handling,
reporting, licensing, permitting, investigation or remediation of Hazardous
Materials.

“ERISA” means the Employee Retirement Income Security Act of 1974, and the rules
and regulations thereunder.

“ERISA Affiliate” means any Person who together with any Borrower is treated as
a single employer within the meaning of Section 414(b), (c), (m) or (o) of the
Code or Section 4001(b) of ERISA.

“Eurodollar Reserve Percentage” means, for any day, the percentage (expressed as
a decimal and rounded upwards, if necessary, to the next higher 1/100th of 1%)
which is in effect for such day as prescribed by the Federal Reserve Board (or
any successor) for determining the maximum reserve requirement (including
without limitation any basic, supplemental or emergency reserves) in respect of
eurocurrency liabilities or any similar category of liabilities for a member
bank of the Federal Reserve System in New York City.

 

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“Event of Default” means any of the events specified in Section 11.1, provided
that any requirement for passage of time, giving of notice, or any other
condition, has been satisfied.

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

“Existing Credit Agreement” shall have the meaning assigned thereto in the
Statement of Purpose.

“Existing Letters of Credit” means, collectively, all letters of credit
identified on Schedule 1.1(a).

“Extensions of Credit” means, as to any Lender at any time, (a) an amount equal
to the sum of (i) the aggregate principal amount of all Revolving Credit Loans
made by such Lender then outstanding, (ii) such Lender’s Revolving Credit
Commitment Percentage of the L/C Obligations then outstanding and (iii) such
Lender’s Revolving Credit Commitment Percentage of the Swingline Loans then
outstanding, or (b) the making of any Loan or participation in any Letters of
Credit by such Lender, as the context requires.

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

“FDIC” means the Federal Deposit Insurance Corporation.

“Federal Funds Rate” means, the rate per annum (rounded upwards, if necessary,
to the next higher 1/100th of 1%) representing the daily effective federal funds
rate as quoted by the Administrative Agent and confirmed in Federal Reserve
Board Statistical Release H.15 (519) or any successor or substitute publication
selected by the Administrative Agent. If, for any reason, such rate is not
available, then “Federal Funds Rate” shall mean a daily rate which is
determined, in the opinion of the Administrative Agent, to be the rate at which
federal funds are being offered for sale in the national federal funds market at
9:00 a.m. (Eastern time). Rates for weekends or holidays shall be the same as
the rate for the most immediately preceding Business Day. Notwithstanding
anything contained herein to the contrary, in no event shall the Federal Funds
Rate be less than 0%.

 

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“Fee Letters” means, collectively, (a) the letter agreement dated September 18,
2014, among the Company, Wells Fargo and Wells Fargo Securities, LLC, (b) the
letter agreement dated September 18, 2014, among the Company, Bank of America,
N.A. and Merrill Lynch, Pierce, Fenner & Smith Incorporated and (c) the letter
agreement dated September 18, 2014, between the Company and BB&T.

“Fiscal Year” means the fiscal year of the Borrowers and their Subsidiaries
ending on the Saturday closest to January 31 (whether such Saturday occurs in
January or February).

“Fixed Charges” means, for any period, the sum of the following determined on a
Consolidated basis, without duplication, for the Borrowers and their
Subsidiaries in accordance with GAAP: (a) Interest Expense for such period and
(b) Rental Expense for such period.

“Fixed Charge Coverage Ratio” means, as of the end of any fiscal quarter of the
Borrowers, the ratio of (a) EBITDAR for the period of four (4) consecutive
fiscal quarters ending on or immediately prior to such date to (b) Fixed Charges
for the period of four (4) consecutive fiscal quarters ending on or immediately
prior to such date.

“Fronting Exposure” means, at any time there is a Defaulting Lender, (a) with
respect to the Issuing Lender, such Defaulting Lender’s Revolving Credit
Commitment 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 pursuant to Section 4.13(c) or cash collateral
or other credit support reasonably acceptable to the Issuing Lender shall have
been provided in accordance with the terms hereof and (b) with respect to the
Swingline Lender, such Defaulting Lender’s Revolving Credit Commitment
Percentage of Swingline Loans other than Swingline Loans as to which such
Defaulting Lender’s participation obligation has been reallocated to other
Lenders pursuant to Section 4.13(c), repaid by the Borrower or for which cash
collateral or other credit support reasonably acceptable to the Swingline Lender
shall have been provided in accordance with the terms hereof.

“Funded Debt” means all liabilities, obligations and indebtedness of the
Borrowers for borrowed money including, but not limited to, obligations
evidenced by bonds, debentures, notes or other similar instruments and all
obligations under Capital Leases.

“GAAP” means generally accepted accounting principles, as recognized by the
American Institute of Certified Public Accountants and the Financial Accounting
Standards Board, consistently applied and maintained on a consistent basis for
the Borrowers and their Subsidiaries throughout the period indicated and
(subject to Section 13.8) consistent with the prior financial practice of the
Borrowers and their Subsidiaries.

“Governmental Approvals” means all authorizations, consents, approvals, licenses
and exemptions of, registrations and filings with, and reports to, all
Governmental Authorities.

“Governmental Authority” means the government of the United States of America or
any other nation, or of any political subdivision thereof, whether state or
local, and any agency,

 

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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
supranational bodies such as the European Union or the European Central Bank).

“Guaranty Obligation” means, with respect to the Borrowers and their
Subsidiaries, without duplication, any obligation, contingent or otherwise, of
any such Person pursuant to which such Person has directly or indirectly
guaranteed any Debt or other obligation of any other Person and, without
limiting the generality of the foregoing, any obligation, direct or indirect,
contingent or otherwise, of any such Person (a) to purchase or pay (or advance
or supply funds for the purchase or payment of) such Debt or other obligation
(whether arising by virtue of partnership arrangements, by agreement to keep
well, to purchase assets, goods, securities or services, to take-or-pay, or to
maintain financial statement condition or otherwise) or (b) entered into for the
purpose of assuring in any other manner the obligee of such Debt or other
obligation of the payment thereof or to protect such obligee against loss in
respect thereof (in whole or in part); provided, that the term Guaranty
Obligation shall not include endorsements for collection or deposit in the
ordinary course of business.

“Hazardous Materials” means any substances or materials (a) which are or become
defined as hazardous wastes, hazardous substances, pollutants, contaminants,
chemical substances or mixtures or toxic substances under any Environmental Law,
(b) which are toxic, explosive, corrosive, flammable, infectious, radioactive,
carcinogenic, mutagenic or otherwise harmful to human health or the environment
and are or become regulated by any Governmental Authority, (c) the presence of
which require investigation or remediation under any Environmental Law or common
law, (d) the discharge or emission or release of which requires a permit or
license under any Environmental Law or other Governmental Approval, (e) which
are deemed to constitute a nuisance or a trespass which pose a health or safety
hazard to Persons or neighboring properties, (f) which consist of underground or
aboveground storage tanks, whether empty, filled or partially filled with any
substance, or (g) which contain, without limitation, asbestos, polychlorinated
biphenyls, urea formaldehyde foam insulation, petroleum hydrocarbons, petroleum
derived substances or waste, crude oil, nuclear fuel, natural gas or synthetic
gas.

“Hedge Bank” means any Person that, (i) at the time it enters into a Hedging
Agreement with any Borrower, is a Lender, an Affiliate of a Lender, the
Administrative Agent or an Affiliate of the Administrative Agent or (b) at the
time it (or its Affiliate) becomes a Lender (including on the Closing Date), is
a party to a Hedging Agreement with a Borrower, in each case in its capacity as
a party to such Hedging Agreement.

“Hedging Agreement” means any agreement with respect to any Interest Rate
Contract, agreement, commodity swap, forward foreign exchange agreement,
currency swap agreement, cross-currency rate swap agreement, currency option
agreement or other agreement or arrangement designed to alter the risks of any
Person arising from fluctuations in rates, currency values or commodity prices.

“Indemnitees” has the meaning specified in Section 13.2.

 

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“Interest Expense” means, with respect to the Borrowers and their Subsidiaries
for any period, the gross interest expense (including, without limitation,
interest expense attributable to Capital Leases and all net payment obligations
pursuant to Hedging Agreements) of the Borrowers and their Subsidiaries, all
determined for such period on a Consolidated basis, without duplication, in
accordance with GAAP.

“Interest Period” shall have the meaning assigned thereto in Section 4.1(b).

“Interest Rate Contract” means any interest rate swap agreement, interest rate
cap agreement, interest rate floor agreement, interest rate collar agreement,
interest rate option or any other agreement regarding the hedging of interest
rate risk exposure executed in connection with hedging the interest rate
exposure of any Person and any confirming letter executed pursuant to such
agreement.

“ISP 98” means the International Standby Practices (1998 Revision, effective
January 1, 1999), International Chamber of Commerce Publication No. 590.

“Issue” means, with respect to any Letter of Credit, to issue, to amend or to
extend the expiry of, or to renew or increase the stated amount of, such Letter
of Credit; and the terms “Issued”, “Issuing” and “Issuance” have correlative
meanings.

“Issuing Lenders” means, collectively, Wells Fargo, Bank of America and BB&T, in
their capacity as an issuer of any Letter of Credit. All references herein to
“the Issuing Lender” shall mean the applicable Issuing Lender as the context
requires.

“Joinder Agreement” means, collectively, each joinder agreement in form and
substance acceptable to the Administrative Agent executed in favor of the
Administrative Agent for the ratable benefit of itself and the Lenders.

“Joint Lead Arrangers” means Wells Fargo Securities, LLC, Merrill Lynch, Pierce,
Fenner & Smith Incorporated and BB&T Capital Markets.

“L/C Commitment” means, at any time with respect to any Issuing Lender, the
obligation of such Issuing Lender to Issue Letters of Credit hereunder from time
to time in an aggregate amount equal to the amount set forth opposite the name
of each such Issuing Lender on Schedule 1.1(b).

“L/C Facility” means the letter of credit facility established pursuant to
Article III.

“L/C Obligations” means at any time, an amount equal to the sum of (a) the
aggregate undrawn and unexpired amount available of the then outstanding Letters
of Credit and (b) the aggregate amount of drawings under Letters of Credit which
have not then been reimbursed pursuant to Section 3.5. 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 1.2(d). 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 98, such Letter of Credit shall be
deemed to be “outstanding” in the amount so remaining available to be drawn.

 

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“L/C Participant” means the collective reference to all the Lenders other than
the applicable Issuing Lender.

“Lender” means each Person executing this Agreement as a Lender (including,
without limitation, the Issuing Lenders and the Swingline Lender unless the
context otherwise requires) set forth on the signature pages hereto, each Person
that hereafter becomes a party to this Agreement as a Lender pursuant to
Section 13.9 and each New Lender.

“Lending Office” means, with respect to any Lender, the office of such Lender
maintaining such Lender’s Extensions of Credit.

“Letters of Credit” shall mean the collective reference to the Existing Letters
of Credit and any letter of credit Issued by an Issuing Lender pursuant to the
terms of this Agreement.

“Leverage Ratio” shall have the meaning assigned thereto in Section 9.1.

“LIBOR” means the rate of interest per annum determined on the basis of the rate
for deposits in Dollars in minimum amounts of at least $5,000,000 for a period
equal to the applicable Interest Period which appears on the Reuters Screen
LIBOR01 (or any applicable successor page) at approximately 11:00 a.m. (London
time) two (2) Business Days prior to the first day of the applicable Interest
Period (rounded upward, if necessary, to the nearest 1/100th of 1%). If, for any
reason, such rate does not appear on Reuters Screen LIBOR01 (or any applicable
successor page), then “LIBOR” shall be determined by the Administrative Agent to
be the arithmetic average of the rate per annum at which deposits in Dollars in
minimum amounts of at least $5,000,000 would be offered by first class banks in
the London interbank market to the Administrative Agent at approximately 11:00
a.m. (London time) two (2) Business Days prior to the first day of the
applicable Interest Period for a period equal to such Interest Period. Each
calculation by the Administrative Agent of LIBOR shall be conclusive and binding
for all purposes, absent manifest error. Notwithstanding anything contained
herein to the contrary, in no event shall LIBOR be less than 0%.

“LIBOR Market Index Rate” means, as of any date, the fluctuating rate per annum
of interest equal to the LIBOR Rate with a term equivalent to a one month
Interest Period on such date.

“LIBOR Rate” means a rate per annum (rounded upwards, if necessary, to the next
higher 1/100th of 1%) determined by the Administrative Agent pursuant to the
following formula:

 

LIBOR Rate =                               LIBOR                           
1.00-Eurodollar Reserve Percentage

“LIBOR Rate Loan” means any Loan bearing interest at a rate based upon the LIBOR
Rate as provided in Section 4.1(a).

“Lien” means, with respect to any asset, any mortgage, leasehold mortgage, lien,
pledge, charge, security interest, hypothecation or encumbrance of any kind in
respect of such asset. For the purposes of this Agreement, a Person shall be
deemed to own subject to a Lien any asset which it has acquired or holds subject
to the interest of a vendor or lessor under any conditional sale agreement,
Capital Lease or other title retention agreement relating to such asset.

 

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“Loan Documents” means, collectively, this Agreement, the Notes, the
Applications, the Fee Letters, each Joinder Agreement and each other document,
instrument, certificate and agreement executed and delivered by the Borrowers or
any of their Subsidiaries in connection with any of the foregoing or otherwise
referred to herein or contemplated hereby (excluding any Hedging Agreement and
any Cash Management Agreement).

“Loans” means the collective reference to the Revolving Credit Loans and the
Swingline Loans, and “Loan” means any of such Loans.

“Material Adverse Effect” means, with respect to the Borrowers or any of their
Subsidiaries, a material adverse effect on the properties, business, prospects,
operations or condition (financial or otherwise) of any such Person or the
ability of any such Person to perform its obligations under the Loan Documents
or Material Contracts, in each case to which it is a party.

“Material Contract” means (a) any contract or other agreement, written or oral,
of any Borrower or any of its Subsidiaries involving monetary liability of or to
any such Person in an amount in excess of $30,000,000 per annum, or (b) any
other contract or agreement, written or oral, of any Borrower or any of its
Subsidiaries the failure to comply with which could reasonably be expected to
have a Material Adverse Effect.

“Multiemployer Plan” means a “multiemployer plan” as defined in
Section 4001(a)(3) of ERISA to which any Borrower or any ERISA Affiliate is
making, or is accruing an obligation to make, or has accrued an obligation to
make contributions within the preceding six (6) years.

“Net Income” means, with respect to the Borrowers and their Subsidiaries, for
any period of determination, the net income (or loss) of the Borrowers and their
Subsidiaries for such period, determined on a Consolidated basis in accordance
with GAAP; provided that there shall be excluded from Net Income (a) the net
income (or loss) of any Person (other than a Subsidiary which shall be subject
to clause (c) below), in which any Borrower or any of its Subsidiaries has a
joint interest with a third party, except to the extent such net income is
actually paid to such Borrower or any of its Subsidiaries by dividend or other
distribution during such period, (b) the net income (or loss) of any Person
accrued prior to the date it becomes a Subsidiary of such Person or is merged
into or consolidated with such Person or any of its Subsidiaries or that
Person’s assets are acquired by such Person or any of its Subsidiaries except to
the extent included pursuant to the foregoing clause (a), and (c) the net income
(if positive) of any Subsidiary to the extent that the declaration or payment of
dividends or similar distributions by such Subsidiary to any Borrower or any of
its Subsidiaries of such net income (i) is not at the time permitted by
operation of the terms of its charter or any agreement, instrument, judgment,
decree, order, statute rule or governmental regulation applicable to such
Subsidiary or (ii) would be subject to any taxes payable on such dividends or
distributions.

“Net Worth” means the amount of assets shown on the Consolidated balance sheet
of the Borrowers and their Subsidiaries (including any items which would be
treated as intangibles

 

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under GAAP, including, but not limited to capitalized interest, debt discount
and expense, goodwill, patents, trademarks, copyrights, licenses and
franchises), less all liabilities of the Borrowers and their Subsidiaries, all
computed in accordance with GAAP, applied on a consistent basis (such
calculation shall exclude any non-cash increase or decrease to the Prepaid
Pension Asset account, as required by GAAP).

“New Lender” shall have the meaning assigned thereto in Section 2.7(c).

“Non-Defaulting Lender” means each Lender that is not a Defaulting Lender.

“Non-Extension Notice Date” shall have the meaning assigned thereto in
Section 3.1(b).

“Notes” means the collective reference to, the Revolving Credit Notes and the
Swingline Notes and “Note” means any of such Notes.

“Notice of Account Designation” shall have the meaning assigned thereto in
Section 2.3(b).

“Notice of Borrowing” shall have the meaning assigned thereto in Section 2.3(a).

“Notice of Conversion/Continuation” shall have the meaning assigned thereto in
Section 4.2.

“Notice of Repayment” shall have the meaning assigned thereto in Section 2.4(c).

“Obligations” means, in each case, whether now in existence or hereafter
arising: (a) the principal of and interest on (including interest accruing after
the filing of any bankruptcy or similar petition) the Loans, (b) the L/C
Obligations, (c) all existing or future payment and other obligations owing by
any Borrower under any Hedging Agreement (which such Hedging Agreement is
permitted hereunder) with any Hedge Bank (all such obligations with respect to
any such Hedging Agreement other than Excluded Swap Obligations, “Hedging
Obligations”), (d) all payment and other obligations owing or payable at any
time by any Borrower to any Cash Management Bank under or in connection with any
Cash Management Agreement and (e) all other fees (including fees accruing after
the filing of any bankruptcy or similar petition) and commissions (including
attorneys’ fees), charges, indebtedness, loans, liabilities, financial
accommodations, obligations, covenants and duties owing by any Borrower or any
of its Subsidiaries to the Lenders or the Administrative Agent, in each case
under or in respect of this Agreement, any Note, any Letter of Credit or any of
the other Loan Documents of every kind, nature and description, direct or
indirect, absolute or contingent, due or to become due, contractual or tortious,
liquidated or unliquidated, and whether or not evidenced by any note.

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

“Officer’s Compliance Certificate” shall have the meaning assigned thereto in
Section 7.2.

 

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“Operating Lease” shall mean, as to any Person as determined in accordance with
GAAP, any lease of property (whether real, personal or mixed) by such Person as
lessee which is not a Capital Lease.

“Other Taxes” shall have the meaning assigned thereto in Section 4.11(b).

“Patriot Act” shall have the meaning given to such term in Section 13.22.

“PBGC” means the Pension Benefit Guaranty Corporation or any successor agency.

“Pension Plan” means any Employee Benefit Plan, other than a Multiemployer Plan,
that is subject to the provisions of Title IV of ERISA or Section 412 of the
Code and that (a) is maintained, funded or administered for the employees of any
Borrower or any ERISA Affiliates or (b) has at any time within the preceding six
(6) years been maintained, funded or administered for the employees of any
Borrower or any of its current or former ERISA Affiliates.

“Person” means an individual, corporation, limited liability company,
partnership, association, trust, business trust, joint venture, joint stock
company, pool, syndicate, sole proprietorship, unincorporated organization,
Governmental Authority or any other form of entity or group thereof.

“Prepaid Pension Asset” as of any date of determination, means the fair value of
the Pension Plans’ assets plus unrecognized gains/losses, prior service costs,
and any unrecognized net obligation or asset from transitions in excess of the
projected benefit obligations, all determined in accordance with Financial
Accounting Standard No. 87-Employer’s Accounting for Pensions.

“Prime Rate” means, at any time, the rate of interest per annum publicly
announced from time to time by Wells Fargo as its prime rate. Each change in the
Prime Rate shall be effective as of the opening of business on the day such
change in such prime rate occurs. The parties hereto acknowledge that the rate
announced publicly by Wells Fargo as its prime rate is an index or base rate and
shall not necessarily be its lowest or best rate charged to its customers or
other banks.

“Register” shall have the meaning assigned thereto in Section 13.9(d).

“Reimbursement Obligation” means the obligation of the Borrowers to reimburse
the Issuing Lender pursuant to Section 3.5 for amounts drawn under Letters of
Credit.

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

“Required Lenders” means at any date, any combination of Lenders whose Revolving
Credit Commitments constitute more than fifty percent (50%) of the Aggregate
Commitment (or, if the Credit Facility has been terminated pursuant to
Section 11.2, any combination of Lenders holding more than fifty percent
(50%) of the aggregate outstanding Extensions of Credit; provided that the
Revolving Credit Commitment of, and the portion of the Extensions of Credit, as
applicable, held or deemed held by, any Defaulting Lender shall be excluded for
purposes of making a determination of Required Lenders.

 

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“Rental Expense” means, for the period of four (4) consecutive fiscal quarters
ending on or prior to the applicable date, payments made pursuant to all
obligations of the Borrowers and their Subsidiaries under leases (other than
Capital Leases) of real property or personal property, whether now existing or
hereafter entered into; provided that (a) for any period during which any
acquisition permitted pursuant to the terms of Section 10.3(c) is consummated,
Rental Expense shall be adjusted to give effect to the consummation of such
permitted acquisition on a pro forma basis in accordance with GAAP, as if such
acquisition occurred on the first day of such period, including, without
limitation, adjustments reflecting any non-recurring costs, extraordinary
expenses and expense savings calculated in a manner reasonably satisfactory to
the Administrative Agent and (b) Rental Expense shall exclude any amounts
required to be paid by any lessee (whether or not therein designated as rental
or additional rental) (i) which are on account of maintenance and repairs,
insurance, taxes, assessments, water rates and similar charges or (ii) which are
based on profits, revenues or sales realized by such lessee from the leased
property or otherwise based on the performance of the lessee.

“Responsible Officer” means any of the following: the chief executive officer or
chief financial officer of a Borrower or any other officer of a Borrower
reasonably acceptable to the Administrative Agent.

“Revolving Credit Commitment” means, (a) as to any Revolving Credit Lender, the
obligation of such Revolving Credit Lender to make Loans to and Issue or
participate in Letters of Credit Issued for the account of the Borrowers
hereunder in an aggregate principal or face amount at any time outstanding not
to exceed the amount set forth in the Register, as the same may be reduced or
modified at any time or from time to time pursuant to the terms hereof, and
(b) as to all Revolving Credit Lenders, the aggregate commitment of all
Revolving Credit Lenders to make Revolving Credit Loans, as such amount may be
reduced at any time or from time to time pursuant to the terms hereof. The
Revolving Credit Commitment of each Revolving Credit Lender on the Closing Date
shall be the amount set forth opposite the name of each such Revolving Credit
Lender on Schedule 1.1(b).

“Revolving Credit Commitment Percentage” means, as to any Lender at any time,
the ratio of (a) the amount of the Revolving Credit Commitment of such Revolving
Credit Lender to (b) the Revolving Credit Commitment of all Revolving Credit
Lenders.

“Revolving Credit Facility” means the revolving credit facility established
pursuant to Article II.

“Revolving Credit Lenders” means Lenders with a Revolving Credit Commitment.

“Revolving Credit Loans” means any revolving loan made to the Borrowers pursuant
to Section 2.1 and Section 2.7, and all such revolving loans collectively as the
context requires.

“Revolving Credit Notes” means the collective reference to the Revolving Credit
Notes made by the Borrowers in favor of a Revolving Credit Lender evidencing the
Revolving Credit Loans made by such Revolving Credit Lender, substantially in
the form of Exhibit A-1 hereto,

 

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evidencing the Revolving Credit Facility, and any substitutions therefor, and
any replacements, restatements, renewals or extension thereof, in whole or in
part; “Revolving Credit Note” means any of such Revolving Credit Notes.

“Revolving Credit Termination Date” means the earliest of (a) October 22, 2019,
(b) the date of termination by the Borrowers pursuant to Section 2.6 or (c) the
date of termination pursuant to Section 11.2(a).

“Sanctioned Country” means, at any time, a country or territory which is itself
the subject or target of any Sanctions (at the time of this Agreement, Cuba,
Iran, North Korea, Sudan and Syria).

“Sanctions” means (i) economic or financial sanctions or trade embargoes
imposed, administered or enforced from time to time by the United States
government, including those administered or enforced by OFAC, the United Nations
Security Council, the European Union or Her Majesty’s Treasury of the United
Kingdom, and (ii) economic or financial sanctions imposed, administered or
enforced from time to time by the United States State Department, the United
States Department of Commerce or the United States Department of the Treasury.

“Sanctions List” means any of the lists of specifically designated nationals or
designated Persons published (and accessible to the public) by the US government
and administered by OFAC, the United States State Department, the United States
Department of Commerce or the United States Department of the Treasury or the
United Nations Security Council or any similar list maintained by the European
Union, any other EU Member State or any other U.S. government entity, in each
case as the same may be amended, supplemented or substituted from time to time.

“Senior Notes” means, collectively, the 2005 Senior Notes, the 2007 Senior
Notes, the 2010 Senior Notes, and the 2011 Senior Notes.

“Solvent” means, as to any Borrower and its Subsidiaries on a particular date,
that any such Person (a) has capital sufficient to carry on its business and
transactions and all business and transactions in which it is about to engage
and is able to pay its debts as they mature, (b) owns property having a value,
both at fair valuation and at present fair saleable value, greater than the
amount required to pay its probable liabilities (including contingencies), and
(c) does not believe that it will incur debts or liabilities beyond its ability
to pay such debts or liabilities as they mature.

“Subordinated Debt” means the collective reference to any Debt of any Borrower
or any Subsidiary subordinated in right and time of payment to the Obligations
and containing such other terms and conditions, in each case as are satisfactory
to the Required Lenders.

“Subsidiary” means as to any Person, any corporation, partnership, limited
liability company or other entity of which more than fifty percent (50%) of the
outstanding capital stock or other ownership interests having ordinary voting
power to elect a majority of the board of directors or other managers of such
corporation, partnership, limited liability company or other entity is at the
time owned by or the management is otherwise controlled by such Person
(irrespective of whether, at the time, capital stock or other ownership
interests of any other class

 

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or classes of such corporation, partnership, limited liability company or other
entity shall have or might have voting power by reason of the happening of any
contingency). Unless otherwise qualified references to “Subsidiary” or
“Subsidiaries” herein shall refer to those of the Borrowers.

“Subsidiary Borrowers” shall have the meaning assigned thereto in the preamble
hereof.

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

“Swingline Facility” means the swingline facility established pursuant to
Section 2.2.

“Swingline Lender” means Wells Fargo in its capacity as swingline lender
hereunder.

“Swingline Loan” means any swingline loan made by the Swingline Lender to the
Borrowers pursuant to Section 2.2, and all such swingline loans collectively as
the context requires.

“Swingline Note” means the Swingline Note made by the Borrowers payable to the
order of the Swingline Lender, substantially in the form of Exhibit A-2 hereto,
evidencing the Swingline Loans.

“Swingline Sublimit Amount” means $50,000,000.

“Swingline Termination Date” means the first to occur of (a) the resignation of
Wells Fargo as Administrative Agent in accordance with Section 12.9 and (b) the
Revolving Credit Termination Date.

“Synthetic Lease” means any synthetic lease, tax retention operating lease,
off-balance sheet loan or similar off-balance sheet financing product where such
transaction is considered borrowed money indebtedness for tax purposes but is
classified as an Operating Lease in accordance with GAAP.

“Taxes” shall have the meaning assigned thereto in Section 4.11(a).

“Termination Event” means, except for the occurrence of any of the following
that, individually or in the aggregate, could not reasonably be expected to have
a Material Adverse Effect: (a) a “Reportable Event” described in Section 4043 of
ERISA for which the thirty (30) day notice requirement has not been waived by
the PBGC, or (b) the withdrawal of any Borrower or any ERISA Affiliate from a
Pension Plan during a plan year in which it was a “substantial employer” as
defined in Section 4001(a)(2) of ERISA or a cessation of operations that is
treated as such a withdrawal under Section 4062(e) of ERISA, or (c) the
termination of a Pension Plan, 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 of ERISA, if the plan assets are not sufficient to pay all
plan liabilities or (d) the institution of proceedings to terminate, or the
appointment of a trustee with respect to, any Pension Plan by the PBGC, or
(e) any other event or condition which would constitute grounds under
Section 4042(a) of ERISA for the termination

 

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of, or the appointment of a trustee to administer, any Pension Plan, or (f) the
imposition of a Lien pursuant to Section 430(k) of the Code or Section 303 of
ERISA, or (g) the determination that any Pension Plan or Multiemployer Plan is
considered an at-risk plan or plan in endangered or critical status within the
meaning of Section 430, 431 or 432 of the Code or Section 303, 304 or 305 of
ERISA or (h) the partial or complete withdrawal of any Borrower of any ERISA
Affiliate from a Multiemployer Plan if withdrawal liability is asserted by such
Plan, or (i) any event or condition which results in the reorganization or
insolvency of a Multiemployer Plan under Sections 4241 or 4245 of ERISA, or
(j) any event or condition which results in the termination of a Multiemployer
Plan under Section 4041A of ERISA or the institution by PBGC of proceedings to
terminate a Multiemployer Plan under Section 4042 of ERISA or (k) 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 any Borrower or any ERISA
Affiliate.

“UCC” means the Uniform Commercial Code as in effect in the State of North
Carolina, as amended or modified from time to time.

“Uniform Customs” means the Uniform Customs and Practice for Documentary Credits
(2007 Revision), effective July 2007 International Chamber of Commerce
Publication No. 600, as amended.

“United States” means the United States of America.

“Wells Fargo” means Wells Fargo Bank, National Association.

“Wholly Owned” means, with respect to a Subsidiary, that all of the shares of
capital stock or other ownership interests of such Subsidiary are, directly or
indirectly, owned or controlled by any Borrower and/or one or more of its Wholly
Owned Subsidiaries (except for directors’ qualifying shares or other shares
required by Applicable Law to be owned by a Person other than such Borrower).

“Withholding Agent” means the Borrowers and the Administrative Agent.

Section 1.2 Other Definitions and Provisions.

(a) Use of Capitalized Terms. Unless otherwise defined therein, all capitalized
terms defined in this Agreement shall have the defined meanings when used in
this Agreement, the Notes and the other Loan Documents or any certificate,
report or other document made or delivered pursuant to this Agreement.

(b) Eastern Time. Any reference herein to “Eastern time” shall refer to the
applicable time of day in Charlotte, North Carolina.

(c) Miscellaneous. 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,

 

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instrument or other document shall be construed as referring to such agreement,
instrument or other document as from time to time amended, supplemented,
restated or otherwise modified (subject to any restrictions on such amendments,
supplements, restatements 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 permitted hereunder, (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,
implementing, 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.

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

ARTICLE II

REVOLVING CREDIT FACILITY

Section 2.1 Revolving Credit Loans. Subject to the terms and conditions of this
Agreement, and in reliance upon the representations and warranties set forth
herein, each Revolving Credit Lender severally agrees to make Revolving Credit
Loans to the Borrowers from time to time from the Closing Date through, but not
including, the Revolving Credit Termination Date as requested by the Borrowers
in accordance with the terms of Section 2.3; provided, that (a) the aggregate
principal amount of all outstanding Revolving Credit Loans (after giving effect
to any amount requested) shall not exceed the Revolving Credit Commitment less
the sum of all outstanding Swingline Loans and L/C Obligations and (b) the
aggregate principal amount of all outstanding Revolving Credit Loans from any
Lender to the Borrowers shall not at any time exceed such Lender’s Revolving
Credit Commitment less the sum of such Lender’s Revolving Credit Commitment
Percentage of outstanding L/C Obligations and Swingline Loans. Each Revolving
Credit Loan by a Revolving Credit Lender shall be in a principal amount equal to
such Lender’s Revolving Credit Commitment Percentage of the aggregate principal
amount of Revolving Credit Loans requested on such occasion. Subject to the
terms and conditions hereof, the Borrowers may borrow, repay and reborrow
Revolving Credit Loans hereunder until the Revolving Credit Termination Date.

 

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Section 2.2 Swingline Loans.

(a) Availability. Subject to the terms and conditions of this Agreement, the
Swingline Lender agrees to make Swingline Loans to the Borrowers from time to
time from the Closing Date through, but not including, the Swingline Termination
Date; provided, that the aggregate principal amount of all outstanding Swingline
Loans (after giving effect to any amount requested), shall not exceed the lesser
of (a) the Revolving Credit Commitment less the sum of all outstanding Revolving
Credit Loans and L/C Obligations and (b) the Swingline Sublimit Amount.

(b) Payment of Principal and Interest. Interest on Swingline Loans shall be paid
pursuant to the terms of this Agreement. Unless sooner paid pursuant to the
provisions hereof, the principal of each Swingline Loan shall be paid in full,
together with accrued interest thereon, on the earlier to occur of (i) demand
for payment by the Swingline Lender, (ii) the date that is five Business Days
after the date on which such Swingline Loan is made or (iii) the Swingline
Termination Date.

(c) Refunding.

(i) At any time and from time to time in its sole and absolute discretion,
Swingline Loans shall be refunded by the Revolving Credit Lenders on demand by
the Swingline Lender. Such refundings shall be made by the Revolving Credit
Lenders in accordance with their respective Revolving Credit Commitment
Percentages and shall thereafter be reflected as Revolving Credit Loans of the
Revolving Credit Lenders on the books and records of the Administrative Agent.
Each Revolving Credit Lender shall fund its respective Revolving Credit
Commitment Percentage of Revolving Credit Loans as required to repay Swingline
Loans outstanding to the Swingline Lender upon demand by the Swingline Lender on
the same Business Day such demand is made or on the next succeeding Business Day
if such demand is made later than 2:00 p.m. (Eastern time). No Revolving Credit
Lender’s obligation to fund its respective Revolving Credit Commitment
Percentage of a Swingline Loan shall be affected by any other Revolving Credit
Lender’s failure to fund its Revolving Credit Commitment Percentage of a
Swingline Loan, nor shall any Revolving Credit Lender’s Revolving Credit
Commitment Percentage be increased as a result of any such failure of any other
Revolving Credit Lender to fund its Revolving Credit Commitment Percentage of a
Swingline Loan.

(ii) The Borrowers shall pay to the Swingline Lender on demand the amount of
such Swingline Loans to the extent amounts received from the Revolving Credit
Lenders are not sufficient to repay in full the outstanding Swingline Loans
requested or required to be refunded. In addition, the Borrowers hereby
authorize the Administrative Agent to charge any account maintained by the
Borrowers with the Swingline Lender (up to the amount available therein) in
order to immediately pay the Swingline Lender the amount of such Swingline Loans
to the extent amounts received from the Revolving Credit Lenders are not
sufficient to repay in full the outstanding Swingline Loans requested or
required to be refunded. If any portion of any such amount paid to the Swingline
Lender shall be recovered by or on behalf of the Borrowers from

 

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the Swingline Lender in any proceeding under any Debtor Relief Law, the loss of
the amount so recovered shall be ratably shared among all the Revolving Credit
Lenders in accordance with their respective Revolving Credit Commitment
Percentages (unless the amounts so recovered by or on behalf of the Borrowers
pertain to a Swingline Loan extended after the occurrence and during the
continuance of an Event of Default of which the Administrative Agent has
received notice in the manner required pursuant to Section 12.5 and which such
Event of Default has not been waived by the Required Lenders or the Lenders, as
applicable).

(iii) Each Revolving Credit Lender acknowledges and agrees that its obligation
to refund Swingline Loans in accordance with the terms of this Section 2.2 is
absolute and unconditional and shall not be affected by any circumstance
whatsoever, including, without limitation, non-satisfaction of the conditions
set forth in Article V. Further, each Revolving Credit Lender agrees and
acknowledges that if prior to the refunding of any outstanding Swingline Loans
pursuant to this Section 2.2, one of the events described in Section 11.1(j) or
(k) shall have occurred, each Revolving Credit Lender will, on the date the
applicable Revolving Credit Loan would have been made, purchase an undivided
participating interest in the Swingline Loan to be refunded in an amount equal
to its Revolving Credit Commitment Percentage (as in effect immediately prior to
any such event) of the aggregate amount of such Swingline Loan. Each Revolving
Credit Lender will immediately transfer to the Swingline Lender, in immediately
available funds, the amount of its participation and upon receipt thereof the
Swingline Lender will deliver to such Revolving Credit Lender a certificate
evidencing such participation dated the date of receipt of such funds and for
such amount. Whenever, at any time after the Swingline Lender has received from
any Revolving Credit Lender such Revolving Credit Lender’s participating
interest in a Swingline Loan, the Swingline Lender receives any payment on
account thereof, the Swingline Lender will distribute to such Revolving Credit
Lender its participating interest in such amount (appropriately adjusted, in the
case of interest payments, to reflect the period of time during which such
Revolving Credit Lender’s participating interest was outstanding and funded).

(d) Defaulting Lenders. Notwithstanding anything to the contrary contained in
this Section 2.2, the Swingline Lender shall not be obligated to make any
Swingline Loan at a time when any other Lender is a Defaulting Lender, unless
the Swingline Lender has entered into arrangements with the Borrowers or such
Defaulting Lender that are satisfactory to the Swingline Lender to eliminate the
Swingline Lender’s Fronting Exposure (after giving effect to Section 4.13(c))
with respect to any such Defaulting Lender, which may include, at the sole
discretion of the Swingline Lender, cash collateral or other credit support
reasonably acceptable to the Swingline Lender.

Section 2.3 Procedure for Advances of Revolving Credit and Swingline Loans.

(a) Requests for Borrowing. The Borrowers shall give the Administrative Agent
irrevocable prior written notice substantially in the form attached hereto as
Exhibit B (a “Notice of Borrowing”) not later than 11:00 a.m. (Eastern time)
(i) on the same Business Day as each Base Rate Loan and each Swingline Loan and
(ii) at least three (3) Business Days before

 

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each LIBOR Rate Loan, of its intention to borrow, specifying (A) the date of
such borrowing, which shall be a Business Day, (B) the amount of such borrowing,
which shall be, (x) with respect to Base Rate Loans (other than Swingline Loans)
in an aggregate principal amount of $1,000,000 or a whole multiple of $500,000
in excess thereof, (y) with respect to LIBOR Rate Loans in an aggregate
principal amount of $1,000,000 or a whole multiple of $500,000 in excess thereof
and (z) with respect to Swingline Loans in an aggregate principal amount of
$500,000 or a whole multiple of $100,000 in excess thereof, (C) whether such
Loan is to be a Revolving Credit Loan or Swingline Loan, (D) in the case of a
Revolving Credit Loan whether the Loans are to be LIBOR Rate Loans or Base Rate
Loans, and (E) in the case of a LIBOR Rate Loan, the duration of the Interest
Period applicable thereto. A Notice of Borrowing received after 11:00 a.m.
(Eastern time) shall be deemed received on the next Business Day. The
Administrative Agent shall promptly notify the Lenders of each Notice of
Borrowing.

(b) Disbursement of Revolving Credit and Swingline Loans. Not later than 2:00
p.m. (Eastern time) on the proposed borrowing date, (i) each Revolving Credit
Lender will make available to the Administrative Agent, for the account of the
Borrowers, at the office of the Administrative Agent in funds immediately
available to the Administrative Agent, such Lender’s Revolving Credit Commitment
Percentage of the Revolving Credit Loans to be made on such borrowing date and
(ii) the Swingline Lender will make available to the Administrative Agent, for
the account of the Borrowers, at the office of the Administrative Agent in funds
immediately available to the Administrative Agent, the Swingline Loans to be
made on such borrowing date. Upon satisfaction of the applicable conditions set
forth in Section 5.2 (and, if such Borrowing is on the Closing Date,
Section 5.1), the Administrative Agent shall make all funds so received
available to the applicable Borrower in like funds as received by the
Administrative Agent, and the Borrowers hereby irrevocably authorize the
Administrative Agent to disburse the proceeds of each borrowing requested
pursuant to this Section 2.3 in immediately available funds by crediting or
wiring such proceeds to the deposit account of the Company identified in the
most recent notice substantially in the form of Exhibit C hereto (a “Notice of
Account Designation”) delivered by the Borrowers to the Administrative Agent or
as may be otherwise agreed upon by the Borrowers and the Administrative Agent
from time to time. Subject to Section 4.7 hereof, the Administrative Agent shall
not be obligated to disburse the portion of the proceeds of any Revolving Credit
Loan requested pursuant to this Section 2.3 to the extent that any Revolving
Credit Lender has not made available to the Administrative Agent its Revolving
Credit Commitment Percentage of such Loan. Revolving Credit Loans to be made for
the purpose of refunding Swingline Loans shall be made by the Revolving Credit
Lenders as provided in Section 2.2(c).

Section 2.4 Repayment of Loans.

(a) Repayment on Revolving Credit Termination Date. The Borrowers hereby agree
to repay the outstanding principal amount of (i) all Revolving Credit Loans in
full on the Revolving Credit Termination Date, and (ii) all Swingline Loans in
accordance with Section 2.2, together, in each case, with all accrued but unpaid
interest thereon.

(b) Mandatory Repayments. If at any time the outstanding principal amount of all
Revolving Credit Loans plus the sum of all outstanding Swingline Loans and L/C
Obligations exceeds the Revolving Credit Commitment, the Borrowers agree to
repay

 

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immediately upon notice from the Administrative Agent, by payment to the
Administrative Agent for the account of the Lenders an amount equal to such
excess with each such repayment applied first to the outstanding principal
amount of outstanding Swingline Loans, second to the principal amount of
outstanding Revolving Credit Loans and third, with respect to any Letters of
Credit then outstanding, a payment of cash collateral into the Cash Collateral
Account for the benefit of the Issuing Lenders and L/C Participants in an amount
equal to the aggregate then undrawn and unexpired amount of such Letters of
Credit (all such cash collateral to be applied in accordance with
Section 11.2(b)).

(c) Optional Repayments. The Borrowers may at any time and from time to time
repay the Loans, in whole or in part, upon at least three (3) Business Days’
irrevocable notice to the Administrative Agent with respect to LIBOR Rate Loans
and one (1) Business Day irrevocable notice with respect to Base Rate Loans and
Swingline Loans, substantially in the form attached hereto as Exhibit D (a
“Notice of Repayment”) specifying the date and amount of repayment and whether
the repayment is of LIBOR Rate Loans, Base Rate Loans, Swingline Loans or a
combination thereof, and, if of a combination thereof, the amount allocable to
each. Upon receipt of such notice, the Administrative Agent shall promptly
notify each Lender, except with respect to any repayment of Swingline Loans. If
any such notice is given, the amount specified in such notice shall be due and
payable on the date set forth in such notice. Partial repayments shall be in an
aggregate amount of $3,000,000 or a whole multiple of $1,000,000 in excess
thereof with respect to Base Rate Loans (other than Swingline Loans), $5,000,000
or a whole multiple of $1,000,000 in excess thereof with respect to LIBOR Rate
Loans and $500,000 or a whole multiple of $100,000 in excess thereof with
respect to Swingline Loans. Each such repayment shall be accompanied by any
amount required to be paid pursuant to Section 4.9 hereof. A Notice of
Prepayment received after 11:00 a.m. shall be deemed received on the next
Business Day.

(d) Limitation on Repayment of LIBOR Rate Loans. The Borrowers may not repay any
LIBOR Rate Loan on any day other than on the last day of the Interest Period
applicable thereto unless such repayment is accompanied by any amount required
to be paid pursuant to Section 4.9 hereof.

(e) Other Agreements. No repayment or prepayment pursuant to this Section 2.4
shall affect any Borrower’s obligations under any Hedging Agreement or any Cash
Management Agreement.

Section 2.5 Notes.

(a) Revolving Credit Notes. Except as otherwise provided in
Section 13.9 (a)-(e), inclusive, at the request of a Revolving Credit Lender,
such Lender’s Revolving Credit Loans and the obligation of the Borrowers to
repay such Revolving Credit Loans shall be evidenced by a separate Revolving
Credit Note executed by the Borrowers payable to the order of such Revolving
Credit Lender.

(b) Swingline Notes. At the request of the Swingline Lender, the Swingline Loans
and the obligation of the Borrowers to repay such Swingline Loans shall be
evidenced by a Swingline Note executed by the Borrowers payable to the order of
the Swingline Lender.

 

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Section 2.6 Permanent Reduction of the Revolving Credit Commitment.

(a) Voluntary Reduction. The Borrowers shall have the right at any time and from
time to time, upon at least five (5) Business Days prior written notice to the
Administrative Agent, to permanently reduce, without premium or penalty, (i) the
entire aggregate Revolving Credit Commitment or (ii) portions of the Revolving
Credit Commitment, in an aggregate principal amount of not less than $3,000,000
or any whole multiple of $1,000,000 in excess thereof. The amount of each
partial permanent reduction shall be applied pro rata to reduce the remaining
mandatory reduction amounts required under Section 2.6(b), and such reduction
shall permanently reduce the Lenders’ Revolving Credit Commitments to make Loans
and Issue or participate in Letters of Credit pro rata in accordance with their
respective Revolving Credit Commitment Percentages.

(b) Corresponding Payment. Each permanent reduction permitted pursuant to this
Section 2.6 shall be accompanied by a payment of principal sufficient to reduce
the aggregate outstanding Revolving Credit Loans, Swingline Loans and L/C
Obligations, as applicable, after such reduction to the aggregate Revolving
Credit Commitment as so reduced and if the aggregate Revolving Credit Commitment
as so reduced is less than the aggregate amount of all outstanding Letters of
Credit, the Borrowers shall be required to deposit cash collateral in the Cash
Collateral Account in an amount equal to the aggregate then undrawn and
unexpired amount of such Letters of Credit. Such cash collateral shall be
applied in accordance with Section 11.2(b). Any reduction of the aggregate
Revolving Credit Commitment to zero shall be accompanied by payment of all
outstanding Revolving Credit Loans and Swingline Loans (and furnishing of cash
collateral or other credit support reasonably satisfactory to the Administrative
Agent for all L/C Obligations) and shall result in the termination of the
Revolving Credit Commitments and the Revolving Credit Facility. Such cash
collateral shall be applied in accordance with Section 11.2(b). If the reduction
of the aggregate Revolving Credit Commitment requires the repayment of any LIBOR
Rate Loan, such repayment shall be accompanied by any amount required to be paid
pursuant to Section 4.9 hereof.

Section 2.7 Increase of Revolving Credit Commitment.

(a) So long as no Default or Event of Default shall have occurred and be
continuing, at any time prior to the fourth (4th) anniversary of the Closing
Date, the Borrowers shall have the right from time to time upon not less than
thirty (30) days prior written notice to the Administrative Agent to increase
the aggregate Revolving Credit Commitment by an aggregate amount (for all such
requests) not to exceed $200,000,000; provided that any such request for an
increase shall be in a minimum amount of $10,000,000 (and in integral multiples
of $10,000,000), or less, if equal to the maximum remaining amount permitted
above. In no event shall the Aggregate Commitment be increased to an amount
greater than $700,000,000.

(b) Each existing Revolving Credit Lender shall have the right, but not the
obligation, to commit to all or a portion of the proposed increase. Any increase
in the aggregate Revolving Credit Commitment that is accomplished by increasing
the Revolving Credit Commitment of any Revolving Credit Lender or Revolving
Credit Lenders who are at the time of such increase party to this Agreement
(which Lender or Lenders shall consent to such increase in their sole and
absolute discretion) shall be accomplished as follows: (i) this Agreement will

 

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be amended by the Borrowers, the Administrative Agent and those Lender(s) whose
Revolving Credit Commitment(s) is or are being increased (but without any
requirement that the consent of the Required Lenders be obtained) to reflect the
revised Revolving Credit Commitment amounts of each of the Revolving Credit
Lenders, (ii) the Administrative Agent will update the Register to reflect the
revised Revolving Credit Commitment amount and Revolving Credit Commitment
Percentage of each of the Revolving Credit Lenders, (iii) the Extensions of
Credit of each Revolving Credit Lender will be reallocated on the effective date
of such increase among the Revolving Credit Lenders in accordance with their
revised Revolving Credit Commitment Percentages (and the Revolving Credit
Lenders agree to make all payments and adjustments necessary to effect the
reallocation and the Borrowers shall pay any and all costs required pursuant to
Section 4.9 in connection with such reallocation as if such reallocation were a
repayment) and (iv) if requested by such Lender or Lenders, the Borrowers will
deliver new Revolving Credit Note(s) to the Lender or Lenders whose
Commitment(s) is or are being increased reflecting the revised Revolving Credit
Commitment amount of such Revolving Credit Lender(s).

(c) If the Administrative Agent does not receive sufficient commitments from the
existing Revolving Credit Lenders to fund the entire amount of the proposed
increase, Borrower may then solicit commitments from Eligible Assignees. The
failure by any existing Lender to respond to a request for such increase shall
be deemed to be a refusal of such request by such existing Lender. Any increase
in the aggregate Revolving Credit Commitment that is accomplished by addition of
a new Revolving Credit Lender under the Agreement (each such new Lender, a “New
Lender”) shall occur as follows: (i) such New Lender shall be an Eligible
Assignee and shall be subject to the consent of the Administrative Agent, which
consent shall not be unreasonably withheld, (ii) this Agreement will be amended
by the Borrowers, the Administrative Agent and by the party becoming a New
Lender hereunder (but without any requirement that the consent of the Required
Lenders be obtained) solely to reflect the addition of such party as a Revolving
Credit Lender hereunder, (iii) the Administrative Agent will update the Register
to reflect the revised Revolving Credit Commitment and Revolving Credit
Commitment Percentage of each of the Revolving Credit Lenders, (iv) the
Extensions of Credit of each of the Revolving Credit Lenders will be reallocated
on the effective date of such increase among the Revolving Credit Lenders in
accordance with their revised Revolving Credit Commitment Percentages (and the
Revolving Credit Lenders agree to make all payments and adjustments necessary to
effect the reallocation and the Borrowers shall pay any and all costs required
pursuant to Section 4.9 in connection with such reallocation as if such
reallocation were a repayment) and (v) at the request of any Revolving Credit
Lender, the Borrowers will deliver a Revolving Credit Note to such Lender.

(d) As a condition precedent to any such increase, the Borrowers shall deliver a
certificate from the Borrowers dated on the date of such increase and signed by
a Responsible Officer certified as accurate that, before and after giving effect
to such increase, (A) no Default or Event of Default exists and (B) the
Borrowers are in compliance on a pro forma basis with the covenants contained in
Article IX hereof and attaching thereto calculations evidencing such compliance.

 

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Section 2.8 Joint and Several Liability of Borrowers.

(a) Each of the Borrowers is accepting joint and several liability hereunder in
consideration of the financial accommodation to be provided by the Lenders under
this Agreement, for the mutual benefit, directly and indirectly, of each of the
Borrowers and in consideration of the undertakings of each of the Borrowers to
accept joint and several liability for the obligations of each of them.

(b) Each of the Borrowers jointly and severally hereby irrevocably and
unconditionally accepts, not merely as a surety but also as a co-debtor, joint
and several liability with the other Borrowers with respect to the payment and
performance of all of the Obligations (other than Excluded Swap Obligations
solely with respect to such Borrower) arising under this Agreement and the other
Loan Documents, it being the intention of the parties hereto that all the
Obligations (other than Excluded Swap Obligations solely with respect to any
such Borrower) shall be the joint and several obligations of each of the
Borrowers without preferences or distinction among them.

(c) If and to the extent that any of the Borrowers shall fail to make any
payment with respect to any of the Obligations as and when due or to perform any
of the Obligations in accordance with the terms thereof, then in each such
event, the other Borrowers will make such payment with respect to, or perform,
such Obligation (other than Excluded Swap Obligations solely with respect to any
such Borrower).

(d) The obligations of each Borrower under the provisions of this Section 2.8
constitute full recourse obligations of such Borrower, enforceable against it to
the full extent of its properties and assets.

(e) Except as otherwise expressly provided herein, to the extent permitted by
Applicable Law, each Borrower (in its capacity as a joint and several obligor in
respect of the obligations of the other Borrowers) hereby waives notice of
acceptance of its joint and several liability, notice of occurrence of any
Default or Event of Default (except to the extent notice is expressly required
to be given pursuant to the terms of this Agreement), or of any demand for any
payment under this Agreement, notice of any action at any time taken or omitted
by the Administrative Agent or the Lenders under or in respect of any of the
obligations hereunder, any requirement of diligence and, generally, all demands,
notices and other formalities of every kind in connection with this Agreement.
Each Borrower hereby assents to, and waives notice of, any extension or
postponement of the time for the payment of any of the Obligations, the
acceptance of any partial payment thereon, any waiver, consent or other action
or acquiescence by the Administrative Agent or the Lenders at any time or times
in respect of any default by the other Borrowers in the performance or
satisfaction of any term, covenant, condition or provision of this Agreement,
any and all other indulgences whatsoever by the Administrative Agent or the
Lenders in respect of any of the obligations hereunder, and the taking,
addition, substitution or release, in whole or in part, at any time or times, of
any security for any of such obligations or the addition, substitution or
release, in whole or in part, of the other Borrowers. Without limiting the
generality of the foregoing, each Borrower (in its capacity as a joint and
several obligor in respect of the obligations of the other Borrowers) assents to
any other action or delay in acting or any failure to act on the part of the
Administrative Agent or the Lenders, including, without

 

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limitation, any failure strictly or diligently to assert any right or to pursue
any remedy or to comply fully with applicable laws or regulations thereunder
which might, but for the provisions of this Section 2.8, afford grounds for
terminating, discharging or relieving such Borrower, in whole or in part, from
any of its obligations under this Section 2.8, it being the intention of each
Borrower that, so long as any of the Obligations hereunder remain unsatisfied,
the obligations of such Borrower under this Section 2.8 shall not be discharged
except by performance and then only to the extent of such performance. The
obligations of each Borrower under this Section 2.8 shall not be diminished or
rendered unenforceable by any winding up, reorganization, arrangement,
liquidation, reconstruction or similar proceeding with respect to any Borrower
or a Lender. The joint and several liability of the Borrowers hereunder shall
continue in full force and effect notwithstanding any absorption, merger,
amalgamation or any other change whatsoever in the name, membership,
constitution or place of formation of any Borrower or any of the Lenders.

(f) The provisions of this Section 2.8 are made for the benefit of the Lenders
and their successors and assigns, and may be enforced by them from time to time
against any of the Borrowers as often as occasion therefor may arise and without
requirement on the part of the Lenders first to marshal any of its claims or to
exercise any of its rights against the other Borrowers or to exhaust any
remedies available to it against the other Borrowers or to resort to any other
source or means of obtaining payment of any of the Obligations hereunder or to
elect any other remedy. The provisions of this Section 2.8 shall remain in
effect until all the Obligations shall have been paid in full or otherwise fully
satisfied. If at any time, any payment, or any part thereof, made in respect of
any of the Obligations is rescinded or must otherwise be restored or returned by
the Lenders upon the insolvency, bankruptcy or reorganization of any of the
Borrowers, or otherwise, the provisions of this Section 2.8 will forthwith be
reinstated and in effect as though such payment had not been made.

(g) Notwithstanding any provision to the contrary contained herein or in any of
the other Loan Documents, to the extent the obligations of any Borrower shall be
adjudicated to be invalid or unenforceable for any reason (including, without
limitation, because of any applicable state or federal law relating to
fraudulent conveyances or transfers) then the obligations of such Borrower
hereunder shall be limited to the maximum amount that is permissible under
applicable law (whether federal or state and including, without limitation, the
Bankruptcy Code of the United States).

(h) The Subsidiary Borrowers hereby agree among themselves that, if any
Subsidiary Borrower shall make an Excess Payment (as defined below), such
Subsidiary Borrower shall have a right of contribution from each other
Subsidiary Borrower in an amount equal to such other Subsidiary Borrower’s
Contribution Share (as defined below) of such Excess Payment. The payment
obligations of any Subsidiary Borrower under this Section 2.8(h) shall be
subordinate and subject in right of payment to the Obligations until such time
as the Obligations have been indefeasibly paid in full in cash and the Revolving
Credit Commitments terminated, and none of the Subsidiary Borrowers shall
exercise any right or remedy under this Section 2.8(h) against any other
Subsidiary Borrower until such Obligations have been indefeasibly paid in full
in cash and the Revolving Credit Commitments terminated. For purposes of this
Section 2.8(h), (i) “Excess Payment” shall mean the amount paid by any
Subsidiary Borrower in excess of its Ratable Share (as defined below) of any
Obligations; (ii)

 

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“Ratable Share” shall mean, for any Subsidiary Borrower in respect of any
payment of Obligations, the ratio (expressed as a percentage) as of the date of
such payment of Obligations of (A) the amount by which the aggregate present
fair salable value of all of its assets and properties exceeds the amount of all
debts and liabilities of such Subsidiary Borrower (including probable
contingent, subordinated, unmatured, and unliquidated liabilities, but excluding
the obligations of such Subsidiary Borrower hereunder) to (B) the amount by
which the aggregate present fair salable value of all assets and other
properties of all of the Subsidiary Borrowers exceeds the amount of all of the
debts and liabilities (including probable contingent, subordinated, unmatured,
and unliquidated liabilities, but excluding the obligations of the Subsidiary
Borrowers hereunder) of all of the Subsidiary Borrowers; provided, however,
that, for purposes of calculating the Ratable Shares of the Subsidiary Borrowers
in respect of any payment of Obligations, any Subsidiary Borrower that became a
Subsidiary Borrower subsequent to the date of any such payment shall be deemed
to have been a Subsidiary Borrower on the date of such payment and the financial
information for such Subsidiary Borrower as of the date such Subsidiary Borrower
became a Subsidiary Borrower shall be utilized for such Subsidiary Borrower in
connection with such payment; and (iii) “Contribution Share” shall mean, for any
Subsidiary Borrower in respect of any Excess Payment made by any other
Subsidiary Borrower, the ratio (expressed as a percentage) as of the date of
such Excess Payment of (A) the amount by which the aggregate present fair
salable value of all of its assets and properties exceeds the amount of all
debts and liabilities of such Subsidiary Borrower (including probable
contingent, subordinated, unmatured, and unliquidated liabilities, but excluding
the obligations of such Subsidiary Borrower hereunder) to (B) the amount by
which the aggregate present fair salable value of all assets and other
properties of all of the Subsidiary Borrowers other than the maker of such
Excess Payment exceeds the amount of all of the debts and liabilities (including
probable contingent, subordinated, unmatured, and unliquidated liabilities, but
excluding the obligations of the Subsidiary Borrowers) of all of the Subsidiary
Borrowers other than the maker of such Excess Payment; provided, however, that,
for purposes of calculating the Contribution Shares of the Subsidiary Borrowers
in respect of any Excess Payment, any Subsidiary Borrower that became a
Subsidiary Borrower subsequent to the date of any such Excess Payment shall be
deemed to have been a Subsidiary Borrower on the date of such Excess Payment and
the financial information for such Subsidiary Borrower as of the date such
Subsidiary Borrower became a Subsidiary Borrower shall be utilized for such
Subsidiary Borrower in connection with such Excess Payment. Each of the
Subsidiary Borrowers recognizes and acknowledges that the rights to contribution
arising hereunder shall constitute an asset in favor of the party entitled to
such contribution. This Section 2.8 shall not be deemed to affect any right of
subrogation, indemnity, reimbursement or contribution that any Subsidiary
Borrower may have under Applicable Law against the Borrower in respect of any
payment of Obligations.

(i) Notwithstanding any payment or payments by any of the Subsidiary Borrowers
hereunder, or any set-off or application of funds of any of the Subsidiary
Borrowers by the Administrative Agent or any other Secured Party, or the receipt
of any amounts by the Administrative Agent or any other Secured Party with
respect to any of the Obligations, none of the Subsidiary Borrowers shall be
entitled to be subrogated to any of the rights of the Administrative Agent or
any other Secured Party against the Borrower or the other Subsidiary Borrowers
or against any collateral security held by the Administrative Agent or any other
Secured Party for the payment of the Obligations nor shall any of the Subsidiary
Borrowers seek

 

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any reimbursement from the Borrower or any of the other Subsidiary Borrowers in
respect of payments made by such Subsidiary Borrower in connection with the
Obligations, until all amounts owing to the Administrative Agent and the Lenders
on account of the Obligations are indefeasibly paid in full in cash and the
Revolving Credit Commitments are terminated. If any amount shall be paid to any
Subsidiary Borrower on account of such subrogation rights at any time when all
of the Obligations shall not have been indefeasibly paid in full, such amount
shall be held by such Subsidiary Borrower in trust for the Administrative Agent,
segregated from other funds of such Subsidiary Borrower, and shall, forthwith
upon receipt by such Subsidiary Borrower, be turned over to the Administrative
Agent in the exact form received by such Subsidiary Borrower (duly endorsed by
such Subsidiary Borrower to the Administrative Agent, if required) to be applied
against the Obligations, whether matured or unmatured, in such order as set
forth in the Credit Agreement.

Section 2.9 Appointment of the Company. Each of the Borrowers hereby appoints
the Company to act as its agent for all purposes under this Agreement
(including, without limitation, with respect to all matters related to the
borrowing and repayment of Loans) and agrees that (a) the Company may execute
such documents on behalf of the other Borrowers as the Company deems appropriate
in its sole discretion and the Borrowers shall be obligated by all of the terms
of any such document executed on its behalf, (b) any notice or communication
delivered by the Administrative Agent or the Lender to the Company shall be
deemed delivered to the Borrowers and (c) the Administrative Agent or the
Lenders may accept, and be permitted to rely on, any document, instrument or
agreement executed by the Company on behalf of the Borrowers.

ARTICLE III

LETTER OF CREDIT FACILITY

Section 3.1 L/C Commitments.

(a) Subject to the terms and conditions hereof, each Issuing Lender, in reliance
on the agreements of the other Lenders set forth in Section 3.4(a), agrees to
Issue standby and trade Letters of Credit for the account of the Borrowers on
any Business Day from the Closing Date through but not including the tenth
(10th) Business Day prior to the Revolving Credit Termination Date in such form
as may be approved from time to time by such Issuing Lender; provided, that no
Issuing Lender shall Issue any Letters of Credit if, after giving effect to any
such Issuance, (i) the L/C Obligations with respect to Letters of Credit Issued
by such Issuing Lender would exceed the L/C Commitment of such Issuing Lender,
(ii) the aggregate L/C Obligations of the Issuing Lenders would exceed the
Aggregate L/C Commitment, or (iii) the Available Revolving Credit Commitment of
any Lender would be zero or less than zero. Each Letter of Credit shall (A) be
denominated in Dollars in a minimum amount of $5,000, (B) be a standby letter of
credit or trade letter of credit Issued to support obligations of the Borrowers
or any of their Subsidiaries, contingent or otherwise, incurred in the ordinary
course of business, (C) expire on a date satisfactory to the Issuing Lender,
which date shall be no later than the earlier of (1) one (1) year after its date
of Issuance (subject to any automatic extensions permitted below) and (2) the
tenth (10th) Business Day prior to the Revolving Credit Termination Date and
(iii) be subject to the Uniform Customs and/or ISP 98, as set forth in the

 

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Application or as determined by the Issuing Lender and, to the extent not
inconsistent therewith, the laws of the State of North Carolina. The Issuing
Lender shall not at any time be obligated to Issue or maintain any Letter of
Credit hereunder if such Issuance or maintenance would conflict with, or cause
the Issuing Lender or any L/C Participant to exceed any limits imposed by, any
Applicable Law.

(b) If the Borrowers so request in any applicable Application, the Issuing
Lender may, in its sole 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 Issuing
Lender 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 Issuing
Lender, the Borrowers shall not be required to make a specific request to the
Issuing Lender 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 Issuing Lender to permit the extension of such Letter of Credit at
any time to an expiry date not later than the tenth (10th) Business Day prior to
the Revolving Credit Termination Date; provided, however, that the Issuing
Lender shall not permit any such extension if (A) the Issuing Lender 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 Section 3.1(a) or otherwise), or
(B) it has received notice (which may be by telephone or in writing) on or
before the day that is ten 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 the
Company that one or more of the applicable conditions specified in Section 5.2
is not then satisfied, and in each such case directing the Issuing Lender not to
permit such extension.

(c) Notwithstanding anything to the contrary contained in this Section 3.1, the
Issuing Lender shall not be obligated to Issue any Letter of Credit (i) at a
time when any other Lender is a Defaulting Lender, unless the Issuing Lender has
entered into arrangements with the Borrowers or such Defaulting Lender which are
reasonably satisfactory to the Issuing Lender to eliminate the Issuing Lender’s
Fronting Exposure (after giving effect to Section 4.13(c)) with respect to any
such Defaulting Lender, which may include, at the sole discretion of the Issuing
Lender, the delivery of cash collateral or other credit support reasonably
acceptable to the Issuing Lender or (ii) if any order, judgment or decree of any
Governmental Authority or arbitrator shall by its terms purport to enjoin or
restrain the Issuing Lender from Issuing the Letter of Credit, or any Applicable
Law or any request or directive (whether or not having the force of law) from
any Governmental Authority with jurisdiction over the Issuing Lender shall
prohibit, or request that the Issuing Lender refrain from, the Issuance of
letters of credit generally or the Letter of Credit in particular or if any
Change in Law shall impose upon the Issuing Lender with respect to the Letter of
Credit any restriction, reserve, capital or liquidity requirement (for which the
Issuing Lender is not otherwise compensated hereunder) or shall impose upon the
Issuing Lender any unreimbursed loss, cost or expense which the Issuing Lender
in good faith deems material to it. Notwithstanding anything to the contrary
contained herein, the Issuing Lender shall be under no obligation to amend any
Letter of Credit if (A) the

 

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Issuing Lender would have no obligation at such time to Issue the Letter of
Credit in its amended form under the terms hereof, or (B) the beneficiary of the
Letter of Credit does not accept the proposed amendment to the Letter of Credit.

(d) The Existing Letters of Credit shall be deemed to be Letters of Credit
Issued by Wells Fargo under and pursuant to the terms of this Agreement.
Effective on the Closing Date, the participations in the Existing Letters of
Credit (as in effect under the Existing Credit Agreement) shall be adjusted to
give effect to any change in the Revolving Credit Commitment Percentage of each
Lender as a result of this Agreement.

Section 3.2 Procedure for Issuance of Letters of Credit. The Borrowers may from
time to time request that an Issuing Lender issue a Letter of Credit by
delivering to the Issuing Lender an Application therefor, with a copy to the
Administrative Agent, completed to the satisfaction of the Issuing Lender, and
such other certificates, documents and other papers and information as the
Issuing Lender may request. In the event of any conflict between the terms
hereof and the terms of any Application, the terms hereof shall control. Upon
receipt of any Application, the Issuing Lender shall process such Application
and the certificates, documents and other papers and information delivered to it
in connection therewith in accordance with its customary procedures and shall,
subject to Section 3.1(a) and Article V hereof, promptly Issue the Letter of
Credit requested thereby (but in no event shall the Issuing Lender be required
to Issue any Letter of Credit earlier than three (3) Business Days after its
receipt of the Application therefor and all such other certificates, documents
and other papers and information relating thereto) by Issuing the original of
such Letter of Credit to the beneficiary thereof or as otherwise may be agreed
by the Issuing Lender and the Borrowers. The Issuing Lender shall,
contemporaneously with the Issuance of each Letter of Credit, deliver a copy
thereof to the Administrative Agent. The Administrative Agent shall promptly
furnish to the Company a copy of such Letter of Credit and promptly notify each
Revolving Credit Lender of the Issuance and upon request by any Lender, furnish
to such Lender a copy of such Letter of Credit and the amount of such Lender’s
participation therein.

Section 3.3 Fees and Other Charges.

(a) Subject to Section 4.13(f), the Borrowers shall pay to the Administrative
Agent, for the account of the Issuing Lender and the L/C Participants, a letter
of credit fee with respect to each Letter of Credit in an amount equal to the
average outstanding amount of such Letter of Credit during the calendar quarter
for which such fee applies multiplied by the Applicable Margin with respect to
LIBOR Rate Loans (determined on a per annum basis). Such fee shall be payable
quarterly in arrears on the last Business Day of each calendar quarter, on the
Revolving Credit Termination Date and thereafter on demand of the Administrative
Agent with the consent or at the request of the Required Lenders. The
Administrative Agent shall, promptly following its receipt thereof, distribute
to the L/C Participants all fees received pursuant to this Section 3.3(a) in
accordance with their respective Revolving Credit Commitment Percentages.

(b) In addition to the foregoing letter of credit fee, the Borrowers shall pay
directly to the Issuing Lender, a fronting fee with respect to each Letter of
Credit as set forth in the applicable Fee Letter. Such fronting fee shall be
payable quarterly in arrears on the last Business Day of each calendar quarter
commencing with the first such date to occur after the Issuance of such Letter
of Credit, on the Revolving Credit Termination Date, and thereafter on demand of
the Administrative Agent at the request of the Issuing Lender.

 

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(c) In addition to the foregoing fees, the Borrowers shall pay or reimburse the
Issuing Lender for such normal and customary costs and expenses as are incurred
or charged by the Issuing Lender in Issuing, effecting payment under, amending
or otherwise administering any Letter of Credit.

Section 3.4 L/C Participations.

(a) Immediately upon the Issuance of each Letter of Credit, the Issuing Lender
irrevocably agrees to grant and hereby grants to each L/C Participant, and, to
induce the Issuing Lender to Issue Letters of Credit hereunder, each L/C
Participant irrevocably agrees to accept and purchase and hereby accepts and
purchases from the Issuing Lender, on the terms and conditions hereinafter
stated, for such L/C Participant’s own account and risk an undivided interest
equal to such L/C Participant’s Revolving Credit Commitment Percentage in the
Issuing Lender’s obligations and rights under and in respect of each Letter of
Credit Issued hereunder and the amount of each draft paid by the Issuing Lender
thereunder. Each L/C Participant unconditionally and irrevocably agrees with the
Issuing Lender that, if a draft is paid under any Letter of Credit for which the
Issuing Lender is not reimbursed in full by the Borrowers through a Revolving
Credit Loan or otherwise in accordance with the terms of this Agreement, such
L/C Participant shall pay to the Issuing Lender upon demand at the Issuing
Lender’s address for notices specified herein an amount equal to such L/C
Participant’s Revolving Credit Commitment Percentage of the amount of such
draft, or any part thereof, which is not so reimbursed. Each L/C Participant’s
obligation to purchase and fund its participation interest in each Letter of
Credit in accordance with this Section 3.4(a) shall be absolute and
unconditional and shall not be affected by any circumstance, including (i) any
setoff, counterclaim, recoupment, defense or other right which such L/C
Participant may have against the Issuing Lender, the Borrowers or any other
Person for any reason whatsoever; (ii) the occurrence or continuance of a
Default or Event of Default, or (iii) any other occurrence, event or condition,
whether or not similar to any of the foregoing.

(b) Upon becoming aware of any amount required to be paid by any L/C Participant
to the Issuing Lender pursuant to Section 3.4(a) in respect of any unreimbursed
portion of any payment made by the Issuing Lender under any Letter of Credit,
the Issuing Lender shall notify the Administrative Agent and each L/C
Participant of the amount and due date of such required payment and such L/C
Participant shall pay to the Issuing Lender the amount specified on the
applicable due date. If any such amount is paid to the Issuing Lender after the
date such payment is due, such L/C Participant shall pay to the Issuing Lender
on demand, in addition to such amount, the product of (i) such amount, times
(ii) the daily average Federal Funds Rate as determined by the Administrative
Agent during the period from and including the date such payment is due to the
date on which such payment is immediately available to the Issuing Lender, times
(iii) a fraction the numerator of which is the number of days that elapse during
such period and the denominator of which is 360. A certificate of the Issuing
Lender with respect to any amounts owing under this Section 3.4(b) shall be
conclusive in the absence of manifest error. With respect to payment to the
Issuing Lender of the unreimbursed amounts described in this Section 3.4(b), if
the L/C Participants receive notice that

 

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any such payment is due (A) prior to 1:00 p.m. (Eastern time) on any Business
Day, such payment shall be due that Business Day, and (B) after 1:00 p.m.
(Eastern time) on any Business Day, such payment shall be due on the following
Business Day.

(c) Whenever, at any time after the Issuing Lender has made payment under any
Letter of Credit and has received from any L/C Participant its Revolving Credit
Commitment Percentage of such payment in accordance with this Section 3.4, the
Issuing Lender receives any payment related to such Letter of Credit (whether
directly from a Borrower or otherwise, or any payment of interest on account
thereof), the Issuing Lender will distribute to such L/C Participant its
pro-rata share thereof; provided, that in the event that any such payment
received by the Issuing Lender shall be required to be returned by the Issuing
Lender, such L/C Participant shall return to the Issuing Lender the portion
thereof previously distributed by the Issuing Lender to it. The obligations of
the L/C Participants under this clause shall survive the payment in full of the
Obligations and the termination of this Agreement.

Section 3.5 Reimbursement Obligation of the Borrowers. In the event of any
drawing under any Letter of Credit, the Borrowers agree to reimburse the Issuing
Lender in same day funds (either with the proceeds of a Revolving Credit Loan as
provided for in this Section 3.5 or with funds from other sources) on each date
on which the Issuing Lender notifies the Company of the date and amount of a
draft paid under any Letter of Credit. The amount of the Reimbursement
Obligation shall equal the amount of (a) such draft so paid and (b) any amounts
referred to in Section 3.3(c) incurred by the Issuing Lender in connection with
such payment. Unless the Borrowers shall immediately notify the Issuing Lender
that the Borrowers intend to reimburse the Issuing Lender for such drawing from
other sources or funds, the Borrowers shall be deemed to have timely given a
Notice of Borrowing to the Administrative Agent requesting that the Lenders make
a Revolving Credit Loan bearing interest at the Base Rate on such date in the
amount of (a) such draft so paid and (b) any amounts referred to in
Section 3.3(c) incurred by the Issuing Lender in connection with such payment,
and the Lenders shall make a Revolving Credit Loan bearing interest at the Base
Rate in such amount, the proceeds of which shall be applied to reimburse the
Issuing Lender for the amount of the related drawing and costs and expenses.
Each Lender acknowledges and agrees that its obligation to fund a Revolving
Credit Loan in accordance with this Section 3.5 to reimburse the Issuing Lender
for any draft paid under a Letter of Credit is absolute and unconditional and
shall not be affected by any circumstance whatsoever, including, without
limitation, non-satisfaction of the conditions set forth in this Agreement. If
the Borrowers elect to pay the amount of such drawing with funds from other
sources and fail to reimburse the Issuing Lender as provided above, the
unreimbursed amount of such drawing shall bear interest at the rate which would
be payable on any outstanding Base Rate Loans which were then overdue from the
date such amounts become payable (whether at stated maturity, by acceleration or
otherwise) until payment in full.

Section 3.6 Obligations Absolute. The Borrowers’ obligations under this Article
III (including without limitation the Reimbursement Obligation) shall be
absolute and unconditional under any and all circumstances and irrespective of
any set-off, counterclaim or defense to payment which the Borrowers may have or
have had against the Issuing Lender or any beneficiary of a Letter of Credit or
any other Person. The Borrowers also agree that the Issuing Lender and the L/C
Participants shall not be responsible for, and the Borrowers’ Reimbursement
Obligation under Section 3.5 shall not be affected by, among other things, the
validity or

 

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genuineness of documents or of any endorsements thereon, even though such
documents shall in fact prove to be invalid, fraudulent or forged, or any
dispute between or among any Borrower and any beneficiary of any Letter of
Credit or any other party to which such Letter of Credit may be transferred or
any claims whatsoever of any Borrower against any beneficiary of such Letter of
Credit or any such transferee. The Issuing Lender shall not be liable for any
error, omission, interruption or delay in transmission, dispatch or delivery of
any message or advice, however transmitted, in connection with any Letter of
Credit, except for errors or omissions caused by the Issuing Lender’s gross
negligence or willful misconduct as determined by a court of competent
jurisdiction by final and nonappealable judgment. The Borrowers agree that any
action taken or omitted by the Issuing Lender under or in connection with any
Letter of Credit or the related drafts or documents, if done in the absence of
gross negligence or willful misconduct as determined by a court of competent
jurisdiction by final and nonappealable judgment, shall be binding on each
Borrower and shall not result in any liability of the Issuing Lender or any L/C
Participant to any Borrower. The responsibility of the Issuing Lender to the
Borrowers in connection with any draft presented for payment under any Letter of
Credit shall, in addition to any payment obligation expressly provided for in
such Letter of Credit, be limited to determining that the documents (including
each draft) delivered under such Letter of Credit in connection with such
presentment are in conformity with such Letter of Credit.

Section 3.7 Effect of Application. To the extent that any provision of any
Application related to any Letter of Credit is inconsistent with the provisions
of this Article III, the provisions of this Article III shall apply.

ARTICLE IV

GENERAL LOAN PROVISIONS

Section 4.1 Interest.

(a) Interest Rate Options. Subject to the provisions of this Section 4.1, at the
election of the Borrowers, (i) Revolving Credit Loans shall bear interest at
(A) the Base Rate plus the Applicable Margin or (B) the LIBOR Rate plus the
Applicable Margin (provided that the LIBOR Rate shall not be available until
three (3) Business Days after the Closing Date unless the Borrowers have
delivered to the Administrative Agent a letter in form and substance
satisfactory to the Administrative Agent indemnifying the Lenders in the manner
set forth in Section 4.9 of this Agreement) and (ii) any Swingline Loan shall
bear interest at (A) the Base Rate plus the Applicable Margin or (B) the LIBOR
Market Index Rate plus the Applicable Margin for LIBOR Rate Loans. The Borrowers
shall select the rate of interest and Interest Period, if any, applicable to any
Loan at the time a Notice of Borrowing is given or at the time a Notice of
Conversion/Continuation is given pursuant to Section 4.2. Any Loan or any
portion thereof as to which the Borrowers have not duly specified an interest
rate as provided herein shall be deemed a Base Rate Loan.

(b) Interest Periods. In connection with each LIBOR Rate Loan, the Borrowers, by
giving notice at the times described in Section 2.3(a) or Section 4.1(a), shall
elect an interest period (each, an “Interest Period”) to be applicable to such
Loan, which Interest

 

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Period shall be a period of one (1), two (2), three (3) or six (6) months with
respect to each LIBOR Rate Loan; provided that:

(i) the Interest Period shall commence on the date of advance of or conversion
to any LIBOR Rate Loan and, in the case of immediately successive Interest
Periods, each successive Interest Period shall commence on the date on which the
immediately preceding Interest Period expires;

(ii) if any Interest Period would otherwise expire on a day that is not a
Business Day, such Interest Period shall expire on the next succeeding Business
Day; provided, that if any Interest Period with respect to a LIBOR Rate Loan
would otherwise expire on a day that is not a Business Day but is a day of the
month after which no further Business Day occurs in such month, such Interest
Period shall expire on the immediately preceding Business Day;

(iii) any Interest Period with respect to a LIBOR Rate Loan 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 relevant calendar month at the
end of such Interest Period;

(iv) no Interest Period shall extend beyond the Revolving Credit Termination
Date; and

(v) there shall be no more than ten (10) Interest Periods in effect at any time.

(c) Applicable Margin. The Applicable Margin provided for in Section 4.1(a) with
respect to any Loan (the “Applicable Margin”) shall be based upon the table set
forth below and shall be determined and adjusted quarterly on the date (each a
“Calculation Date”) ten (10) Business Days after the date by which the Borrowers
are required to provide an Officer’s Compliance Certificate for the most
recently ended fiscal quarter of the Borrowers; provided, however, that (a) the
initial Applicable Margin shall be based on Pricing Level IV (as shown below)
and shall remain at Pricing Level IV until the first Calculation Date occurring
after the Closing Date and, thereafter the Pricing Level shall be determined by
reference to the Leverage Ratio as of the last day of the most recently ended
fiscal quarter of the Borrowers preceding the applicable Calculation Date, and
(b) if the Borrowers fail to provide the Officer’s Compliance Certificate as
required by Section 7.2 for the most recently ended fiscal quarter of the
Borrowers preceding the applicable Calculation Date, the Applicable Margin from
such Calculation Date shall be based on Pricing Level I (as shown below) until
such time as an appropriate Officer’s Compliance Certificate is provided, at
which time the Pricing Level shall be determined by reference to the Leverage
Ratio as of the last day of the most recently ended fiscal quarter of the
Borrowers preceding such Calculation Date. The Applicable Margin shall be
effective from one Calculation Date until the next Calculation Date. Any
adjustment in the Applicable Margin shall be applicable to all Extensions of
Credit then existing or subsequently made or Issued.

 

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Pricing Level

  

Leverage Ratio

  

LIBOR

   

Base Rate

  I    Greater than or equal to 3.25 to 1.00      1.75 %      0.75 %  II   
Greater than or equal to 2.75 to 1.00, but less than 3.25 to 1.00      1.50 %   
  0.50 %  III    Greater than or equal to 2.25 to 1.00, but less than 2.75 to
1.00      1.25 %      0.25 %  IV    Greater than or equal to 1.75 to 1.00, but
less than 2.25 to 1.00      1.125 %      0.125 %  V    Greater than or equal to
1.25 to 1.00 but less than 1.75 to 1.00      1.00 %      0.00 %  VI    Less than
1.25 to 1.00      0.875 %      0.0 % 

(d) Default Rate. Subject to Section 11.3, at the discretion of the
Administrative Agent or as directed by the Required Lenders, upon the occurrence
and during the continuance of an Event of Default, (i) the Borrowers shall no
longer have the option to request LIBOR Rate Loans or Swingline Loans, (ii) all
outstanding LIBOR Rate Loans shall bear interest at a rate per annum of two
percent (2%) in excess of the rate then applicable to LIBOR Rate Loans until the
end of the applicable Interest Period and thereafter at a rate equal to two
percent (2%) in excess of the rate then applicable to Base Rate Loans, and
(iii) all outstanding Base Rate Loans and other Obligations arising hereunder or
under any other Loan Document shall bear interest at a rate per annum equal to
two percent (2%) in excess of the rate then applicable to Base Rate Loans or
such other Obligations arising hereunder or under any other Loan Document.
Interest shall continue to accrue on the Obligations after the filing by or
against any Borrower of any petition seeking any relief in bankruptcy or under
any proceeding under any Debtor Relief Law.

(e) Interest Payment and Computation. Interest on each Base Rate Loan shall be
payable in arrears on the last Business Day of each calendar quarter; and
interest on each LIBOR Rate Loan shall be payable on the last day of each
Interest Period applicable thereto or, in the case of any LIBOR Rate Loan having
an Interest Period of six (6) months, every three (3) months. Interest on LIBOR
Rate Loans and all fees payable hereunder shall be computed on the basis of a
360-day year and assessed for the actual number of days elapsed and interest on
Base Rate Loans shall be computed on the basis of a 365/366-day year and
assessed for the actual number of days elapsed.

(f) Maximum Rate. In no contingency or event whatsoever shall the aggregate of
all amounts deemed interest hereunder or under any of the Loans charged or
collected pursuant to the terms of this Agreement or pursuant to any of the
Loans exceed the highest rate permissible under any Applicable Law which a court
of competent jurisdiction shall, in a final determination, deem applicable
hereto. In the event that such a court determines that the Lenders have charged
or received interest hereunder in excess of the highest applicable rate, the
rate in effect hereunder shall automatically be reduced to the maximum rate
permitted by Applicable Law and the Lenders shall at the Administrative Agent’s
option (i) promptly refund to the Borrowers any interest received by the Lenders
in excess of the maximum lawful rate or

 

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(ii) apply such excess to the principal balance of the Obligations on a pro rata
basis. It is the intent hereof that the Borrowers not pay or contract to pay,
and that neither the Administrative Agent nor any Lender receive or contract to
receive, directly or indirectly in any manner whatsoever, interest in excess of
that which may be paid by the Borrowers under Applicable Law.

Section 4.2 Notice and Manner of Conversion or Continuation of Loans. Provided
that no Default or Event of Default has occurred and is then continuing, the
Borrowers shall have the option to (a) convert at any time following the third
Business Day after the Closing Date all or any portion of any outstanding Base
Rate Loans (other than Swingline Loans) in a principal amount equal to
$5,000,000 or any whole multiple of $1,000,000 in excess thereof into one or
more LIBOR Rate Loans and (b) upon the expiration of any Interest Period,
(i) convert all or any part of its outstanding LIBOR Rate Loans in a principal
amount equal to $3,000,000 or a whole multiple of $1,000,000 in excess thereof
into Base Rate Loans (other than Swingline Loans) or (ii) continue such LIBOR
Rate Loans as LIBOR Rate Loans. Whenever the Borrowers desire to convert or
continue Loans as provided above, the Borrowers shall give the Administrative
Agent irrevocable prior written notice in the form attached as Exhibit E (a
“Notice of Conversion/Continuation”) not later than 11:00 a.m. (Eastern time)
three (3) Business Days before the day on which a proposed conversion or
continuation of such Loan is to be effective specifying (A) the Loans to be
converted or continued, and, in the case of any LIBOR Rate Loan to be converted
or continued, the last day of the Interest Period therefor, (B) the effective
date of such conversion or continuation (which shall be a Business Day), (C) the
principal amount of such Loans to be converted or continued, and (D) the
Interest Period to be applicable to such converted or continued LIBOR Rate Loan.
The Administrative Agent shall promptly notify the Lenders of such Notice of
Conversion/Continuation.

Section 4.3 Fees.

(a) Commitment Fee. Commencing on the Closing Date, subject to Section 4.13(f),
the Borrowers shall pay to the Administrative Agent, for the account of the
Revolving Credit Lenders, a non-refundable commitment fee at a rate per annum
equal to the applicable rate set forth below on the average daily unused portion
of the Revolving Credit Commitment. The applicable commitment fee rate shall be
based upon the table set forth below and shall be determined and adjusted
quarterly on each Calculation Date; provided, however, that (a) the initial
commitment fee rate shall be based on Pricing Level IV (as shown below) and
shall remain at Pricing Level IV until the first Calculation Date occurring
after the Closing Date and, thereafter the Pricing Level shall be determined by
reference to the Leverage Ratio as of the last day of the most recently ended
fiscal quarter of the Borrowers preceding the applicable Calculation Date, and
(b) if the Borrowers fail to provide the Officer’s Compliance Certificate as
required by Section 7.2 for the most recently ended fiscal quarter of the
Borrowers preceding the applicable Calculation Date, the commitment fee from
such Calculation Date shall be based on Pricing Level I (as shown below) until
such time as an appropriate Officer’s Compliance Certificate is provided, at
which time the Pricing Level shall be determined by reference to the Leverage
Ratio as of the last day of the most recently ended fiscal quarter of the
Borrowers preceding such Calculation Date. The commitment fee rate shall be
effective from one Calculation Date until the next Calculation Date. Any
adjustment in the commitment fee rate shall be applicable to all Extensions of
Credit then existing or subsequently made or Issued. The

 

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commitment fee shall be payable in arrears on the last Business Day of each
calendar quarter during the term of this Agreement, and on the Revolving Credit
Termination Date. Notwithstanding anything to the contrary contained herein, for
purposes of calculating the commitment fee payable at any time to any Revolving
Credit Lender other than the Swingline Lender, amounts outstanding under the
Swingline Facility shall not be included in the calculation of the unused
portion of the Revolving Credit Commitment.

 

Pricing Level

  

Leverage Ratio

  

Commitment Fee

  I    Greater than or equal to 3.25 to 1.00      0.225 %  II    Greater than or
equal to 2.75 to 1.00, but less than 3.25 to 1.00      0.175 %  III    Greater
than or equal to 2.25 to 1.00, but less than 2.75 to 1.00      0.150 %  IV   
Greater than or equal to 1.75 to 1.00, but less than 2.25 to 1.00      0.125 % 
V    Greater than or equal to 1.25 to 1.00 but less than 1.75 to 1.00      0.100
%  VI    Less than 1.25 to 1.00      0.080 % 

(b) Administrative Agent’s and Other Fees. The Borrowers shall pay to the
Administrative Agent and the Joint Lead Arrangers, for their own respective
accounts, fees in the amounts and at the times specified in the Fee Letters.

Section 4.4 Manner of Payment.

(a) Each payment by the Borrowers on account of the principal of or interest on
the Loans or of any fee, commission or other amounts (including the
Reimbursement Obligation) payable to the Lenders under this Agreement or any
Note shall be made not later than 1:00 p.m. (Eastern time) on the date specified
for payment under this Agreement to the Administrative Agent at the
Administrative Agent’s Office for the account of the Lenders pro rata in
accordance with their respective Revolving Credit Commitment Percentages, in
Dollars, in immediately available funds and shall be made without any set-off,
counterclaim or deduction whatsoever. Any payment received after such time but
before 2:00 p.m. (Eastern time) on such day shall be deemed a payment on such
date for the purposes of Section 11.1, but for all other purposes shall be
deemed to have been made on the next succeeding Business Day. Any payment
received after 2:00 p.m. (Eastern time) shall be deemed to have been made on the
next succeeding Business Day for all purposes. Upon receipt by the
Administrative Agent of each such payment, the Administrative Agent shall
distribute to each Lender at its address for notices set forth herein its pro
rata share of such payment in accordance with such Lender’s Revolving Credit
Commitment Percentage, with respect to Extensions of Credit and shall wire
advice of the amount of such credit to each Lender. Other than payments governed
by Section 3.3, each payment to the Administrative Agent of the Issuing Lender’s
fees or L/C Participants’ commissions shall be made in like manner, but for the
account of the Issuing Lender or the L/C Participants, as the case may be. Each
payment to the Administrative Agent of Administrative Agent’s fees or expenses
shall be made for the account of the Administrative Agent and any

 

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amount payable to any Lender under Sections 4.8, 4.9, 4.10, 4.11 or 13.2 shall
be paid to the Administrative Agent for the account of the applicable Lender.
Subject to Section 4.1(b)(ii), if any payment under this Agreement or any Note
shall be specified to be made upon a day which is not a Business Day, it shall
be made on the next succeeding day which is a Business Day and such extension of
time shall in such case be included in computing any interest if payable along
with such payment.

(b) Defaulting Lenders. Notwithstanding the foregoing clause (a), if any Lender
becomes a Defaulting Lender, then, until such time as such Lender is no longer a
Defaulting Lender, each payment by the Borrowers hereunder shall be applied in
accordance with Section 4.13(b).

Section 4.5 Crediting of Payments and Proceeds. In the event that the Borrowers
shall fail to pay any of the Obligations when due and the Obligations have been
accelerated pursuant to Section 11.2, all payments received by the Lenders in
respect of the Loans and the other Obligations and all net proceeds from the
enforcement of the Obligations shall be applied: (a) first to all expenses then
due and payable by the Borrowers hereunder and under the other Loan Documents,
(b) then to all indemnity obligations then due and payable by the Borrowers
hereunder and under the other Loan Documents, (c) then to all Administrative
Agent’s and Issuing Lenders’ fees then due and payable, (d) then to all
commitment and other fees and commissions then due and payable, (e) then to
accrued and unpaid interest on the Swingline Loans to the Swingline Lender,
(f) then to the principal amount outstanding under the Swingline Loans to the
Swingline Lender, (g) then to accrued and unpaid interest on the Revolving
Credit Loans and accrued and unpaid interest on the Reimbursement Obligation
(pro rata in accordance with all such amounts due), (h) then to the principal
amount of the Revolving Credit Loans and Reimbursement Obligations and any
Hedging Obligations (including any termination payments and any accrued and
unpaid interest thereon) and obligations under any Cash Management Agreement
with a Cash Management Bank pro rata in accordance with all such amounts due,
(i) then to the Cash Collateral Account described in Section 11.2(b) and
Section 11.2(c) hereof to the extent of any L/C Obligations then outstanding, in
that order. Notwithstanding the foregoing, Obligations arising under Cash
Management Agreements and Hedge Agreements shall be excluded from the
application described above if the Administrative Agent has not received written
notice thereof, together with such supporting documentation as the
Administrative Agent may request, from the applicable Cash Management Bank or
Hedge Bank, as the case may be. Each Cash Management Bank or Hedge Bank not a
party to this Agreement that has given the notice contemplated by the preceding
sentence shall, by such notice, be deemed to have acknowledged and accepted the
appointment of the Administrative Agent pursuant to the terms of Article XII for
itself and its Affiliates as if a “Lender” party hereto.

Section 4.6 Adjustments. If any Lender (a “Benefited Lender”) shall at any time
receive any payment of all or part of the Obligations owing to it, or interest
thereon, or if any Lender shall at any time receive any collateral in respect to
the Obligations owing to it (whether voluntarily or involuntarily, by set-off or
otherwise) (other than pursuant to Sections 4.8, 4.9, 4.10, 4.11 or 13.2 hereof)
in a greater proportion than any such payment to and collateral received by any
other Lender, if any, in respect of the similar Obligations owing to such other
Lender, or interest thereon, such Benefited Lender shall purchase for cash from
the other Lenders such portion of each such other Lender’s Extensions of Credit,
or shall provide such other

 

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Lenders with the benefits of any such collateral, or the proceeds thereof, as
shall be necessary to cause such Benefited Lender to share the excess payment or
benefits of such collateral or proceeds ratably with each of the Lenders;
provided, that

(a) if all or any portion of such excess payment or benefits is thereafter
recovered from such Benefited Lender, such purchase shall be rescinded, and the
purchase price and benefits returned to the extent of such recovery, but without
interest; and

(b) the provisions of this paragraph shall not be construed to apply to (i) any
payment made by the Borrowers pursuant to and in accordance with the express
terms of this Agreement, (ii) the application of cash collateral provided for in
Section 4.13 or (iii) any payment obtained by a Lender as consideration for the
assignment of or sale of a participation in any of its Loans or participations
in Swingline Loans and Letters of Credit to any assignee or participant, other
than to the Borrowers or any Subsidiary thereof (as to which the provisions of
this paragraph shall apply).

The Borrowers agree that each Lender so purchasing a portion of another Lender’s
Extensions of Credit may exercise all rights of payment (including, without
limitation, rights of set-off) with respect to such portion as fully as if such
Lender were the direct holder of such portion.

Section 4.7 Nature of Obligations of Lenders Regarding Extensions of Credit;
Assumption by the Administrative Agent. The obligations of the Lenders under
this Agreement to make the Loans and Issue or participate in Letters of Credit
are several and are not joint or joint and several. Unless the Administrative
Agent shall have received notice from a Lender prior to a proposed borrowing
date that such Lender will not make available to the Administrative Agent such
Lender’s ratable portion of the amount to be borrowed on such date (which notice
shall not release such Lender of its obligations hereunder), the Administrative
Agent may assume that such Lender has made such portion available to the
Administrative Agent on the proposed borrowing date in accordance with
Section 2.3(b) and the Administrative Agent may, in reliance upon such
assumption, make available to the Borrowers on such date a corresponding amount.
If such amount is made available to the Administrative Agent on a date after
such borrowing date, such Lender shall pay to the Administrative Agent on demand
an amount, until paid, equal to the product of (a) the amount not made available
by such Lender in accordance with the terms hereof, times (b) the daily average
Federal Funds Rate during such period as determined by the Administrative Agent,
times (c) a fraction the numerator of which is the number of days that elapse
from and including such borrowing date to the date on which such amount not made
available by such Lender in accordance with the terms hereof shall have become
immediately available to the Administrative Agent and the denominator of which
is 360. A certificate of the Administrative Agent with respect to any amounts
owing under this Section 4.7 shall be conclusive, absent manifest error. If such
Lender’s Revolving Credit Commitment Percentage of such borrowing is not made
available to the Administrative Agent by such Lender within three (3) Business
Days after such borrowing date, the Administrative Agent shall be entitled to
recover such amount made available by the Administrative Agent with interest
thereon at the rate per annum applicable to Base Rate Loans hereunder, on
demand, from the Borrowers. The failure of any Lender to make available its
Revolving Credit Commitment Percentage of any Loan requested by the Borrowers
shall not relieve it or any other Lender of its obligation, if any, hereunder to
make its Revolving Credit Commitment Percentage of such Loan

 

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available on the borrowing date, but no Lender shall be responsible for the
failure of any other Lender to make its Percentage of such Loan available on the
borrowing date. Notwithstanding anything set forth herein to the contrary, any
Lender that fails to make available its Revolving Credit Commitment Percentage
of any Loan shall not (a) have any voting or consent rights under or with
respect to any Loan Document or (b) constitute a “Lender” (or be included in the
calculation of Required Lenders hereunder) for any voting or consent rights
under or with respect to any Loan Document.

Section 4.8 Changed Circumstances.

(a) Circumstances Affecting LIBOR Rate Availability. If with respect to any
Interest Period the Administrative Agent or any Lender (after consultation with
the Administrative Agent) shall determine that, by reason of circumstances
affecting the foreign exchange and interbank markets generally, deposits in
eurodollars, in the applicable amounts are not being quoted via the Reuters
Screen LIBOR01 (or any applicable successor page) or offered to the
Administrative Agent or such Lender for such Interest Period, then the
Administrative Agent shall forthwith give notice thereof to the Company.
Thereafter, until the Administrative Agent notifies the Company that such
circumstances no longer exist, the obligation of the Lenders to make LIBOR Rate
Loans and the right of the Borrowers to convert any Loan to or continue any Loan
as a LIBOR Rate Loan shall be suspended, and the Borrowers shall repay in full
(or cause to be repaid in full) the then outstanding principal amount of each
such LIBOR Rate Loan together with accrued interest thereon, on the last day of
the then current Interest Period applicable to such LIBOR Rate Loan or convert
the then outstanding principal amount of each such LIBOR Rate Loan to a Base
Rate Loan as of the last day of such Interest Period.

(b) Laws Affecting LIBOR Rate Availability. If any Change in Law shall make it
unlawful or impossible for any of the Lenders (or any of their respective
Lending Offices) to honor its obligations hereunder to make or maintain any
LIBOR Rate Loan, such Lender shall promptly give notice thereof to the
Administrative Agent and the Administrative Agent shall promptly give notice to
the Company and the other Lenders. Thereafter, until the Administrative Agent
notifies the Company that such circumstances no longer exist, (i) the
obligations of the Lenders to make LIBOR Rate Loans and the right of the
Borrowers to convert any Loan or continue any Loan as a LIBOR Rate Loan shall be
suspended and thereafter the Borrowers may select only Base Rate Loans
hereunder, and (ii) if any of the Lenders may not lawfully continue to maintain
a LIBOR Rate Loan to the end of the then current Interest Period applicable
thereto as a LIBOR Rate Loan, the applicable LIBOR Rate Loan shall immediately
be converted to a Base Rate Loan for the remainder of such Interest Period.

(c) Increased Costs. If any Change in Law:

(i) shall (except as provided in Section 4.11(e)) subject any of the Lenders (or
any of their respective Lending Offices) to any tax, duty or other charge with
respect to its loans, loan principal, letters of credit, commitments, or other
obligations hereunder, or its deposits, reserves, other liabilities or capital
attributable thereto or shall change the basis of taxation of payments to any of
the Lenders (or any of their respective Lending Offices) of the principal of or
interest on its loans, loan principal, letters of credit, commitments, or other
obligations hereunder, or its deposits, reserves, other

 

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liabilities or capital attributable thereto (except for Taxes covered by
Section 4.11(a) or taxes excluded from the definition of Taxes under
Section 4.11(a)); provided that the Borrowers shall not be obligated to pay any
amounts pursuant to this Section 4.8(c)(i) to the extent that such amounts are
duplicative of any amounts paid by the Borrowers pursuant to Section 4.11; or

(ii) shall impose, modify or deem applicable any reserve (including, without
limitation, any reserve imposed by the Board of Governors of the Federal Reserve
System), special deposit, insurance, compulsory loan, insurance or capital or
similar requirement against assets of, deposits with or for the account of, or
credit extended by any of the Lenders (or any of their respective Lending
Offices) or shall impose on any of the Lenders (or any of their respective
Lending Offices) or the foreign exchange and interbank markets any other
condition, cost or expense (other than taxes) affecting this Agreement or Loans
made by such Lender or any Letter of Credit or participation therein; and the
result of any of the foregoing events described in clause (i) or (ii) above is
to increase the costs to any of the Lenders of making, converting to, continuing
or maintaining any Loan or of maintaining its obligation to make any such Loan
or 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 yield or amount of any sum received or receivable by any of the
Lenders under this Agreement or under the Notes in respect of a LIBOR Rate Loan
or Letter of Credit or Application, then such Lender shall promptly notify the
Administrative Agent, and the Administrative Agent shall promptly notify the
Company of such fact and demand compensation therefor pursuant to a writing
which includes a certificate with supporting calculations and, within fifteen
(15) days after such notice by the Administrative Agent, the Borrowers shall pay
to such Lender such additional amount or amounts as will compensate such Lender
or Lenders for such increased cost or reduction. The Administrative Agent will
promptly notify the Company of any event of which it has knowledge which will
entitle such Lender to compensation pursuant to this Section 4.8(c); provided,
that the Administrative Agent shall incur no liability whatsoever to the Lenders
or the Borrowers in the event it fails to do so. A certificate of such Lender
setting forth the basis for determining such amount or amounts necessary to
compensate such Lender shall be forwarded to the Company through the
Administrative Agent and shall be conclusively presumed to be correct save for
manifest error.

Section 4.9 Indemnity. The Borrowers hereby indemnify each of the Lenders
against any loss or expense which may arise or be attributable to each Lender’s
obtaining, liquidating or employing deposits or other funds acquired to effect,
fund or maintain any LIBOR Rate Loan (a) as a consequence of any failure by the
Borrowers to make any payment when due of any amount due hereunder in connection
with a LIBOR Rate Loan, (b) due to any failure of the Borrowers to borrow,
continue or convert on a date specified therefor in a Notice of Borrowing or
Notice of Conversion/Continuation or (c) due to any payment, prepayment or
conversion of any LIBOR Rate Loan on a date other than the last day of the
Interest Period therefor. The amount of such loss or expense shall be
determined, in the applicable Lender’s sole discretion, based upon the
assumption that such Lender funded its Revolving Credit Commitment Percentage of
the LIBOR Rate Loans in the London interbank market and using any reasonable
attribution or averaging methods which such Lender deems appropriate and

 

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practical. A certificate of such Lender with supporting calculations setting
forth the basis for determining such amount or amounts necessary to compensate
such Lender shall be forwarded to the Company through the Administrative Agent
and shall be conclusively presumed to be correct save for manifest error.

Section 4.10 Capital Requirements. If any Change in Law has or would have the
effect of reducing the rate of return on the capital of, or has affected or
would affect the amount of capital or liquidity required to be maintained by,
any Lender or any corporation controlling such Lender as a consequence of, or
with reference to the Revolving Credit Commitments and other commitments of this
type, below the rate which such Lender or such other corporation could have
achieved but for such Change in Law (taking into consideration such Lender’s or
the Issuing Lender’s policies and the policies of such Lender’s or the Issuing
Lender’s holding company with respect to capital adequacy and liquidity), then
within five (5) Business Days after written demand by any such Lender, the
Borrowers shall pay to such Lender from time to time as specified by such Lender
additional amounts sufficient to compensate such Lender or other corporation for
such reduction. A certificate with supporting calculations as to such amounts
submitted to the Company and the Administrative Agent by such Lender shall, in
the absence of manifest error, be presumed to be correct and binding for all
purposes.

Section 4.11 Taxes.

(a) Payments Free and Clear. Except as otherwise provided in Section 4.11(e),
any and all payments by any Borrower hereunder or under the Notes or the Letters
of Credit shall be made free and clear of and without deduction for any and all
present or future taxes, levies, imposts, deductions, charges or withholding,
and all liabilities with respect thereto excluding, (i) in the case of each
Lender and the Administrative Agent, income and franchise taxes imposed by the
jurisdiction under the laws of which such Lender or the Administrative Agent (as
the case may be) is organized or is or should be qualified to do business or any
political subdivision thereof, (ii) in the case of each Lender, income and
franchise taxes imposed by the jurisdiction of such Lender’s Lending Office or
any political subdivision thereof and (iii) any U.S. federal withholding taxes
imposed under FATCA (all such non-excluded taxes, levies, imposts, deductions,
charges, withholdings and liabilities being hereinafter referred to as “Taxes”).
If any Withholding Agent shall be required by any Applicable Law (as determined
in the good faith discretion of the applicable Withholding Agent) to deduct or
withhold any Taxes from or in respect of any sum payable hereunder or under any
Loan Document or in respect of any Letter of Credit to any Lender or the
Administrative Agent, (A) except as otherwise provided in Section 4.11(e), the
sum payable shall be increased as may be necessary so that after making all
required deductions or withholdings (including deductions or withholdings
applicable to additional sums payable under this Section 4.11) such Lender or
the Administrative Agent (as the case may be) receives an amount equal to the
amount such party would have received had no such deductions or withholdings
been made, (B) the applicable Withholding Agent shall make such deductions or
withholdings and shall pay the full amount deducted or withheld to the relevant
taxing authority or other authority in accordance with Applicable Law.

(b) Stamp and Other Taxes. In addition, the Borrowers shall pay any present or
future stamp, registration, recordation or documentary taxes or any other
similar fees or charges or excise or property taxes, levies of the United States
or any state or political

 

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subdivision thereof or any applicable foreign jurisdiction which arise from any
payment made hereunder or from the execution, delivery or registration of, or
otherwise with respect to, this Agreement, the Loans, the Letters of Credit, or
the other Loan Documents, or the perfection of any rights or security interest
in respect thereof (hereinafter referred to as “Other Taxes”).

(c) Indemnity. Except as otherwise provided in Section 4.11(e), the Borrowers
shall indemnify each Lender and the Administrative Agent for the full amount of
Taxes and Other Taxes (including, without limitation, any Taxes and Other Taxes
imposed by any jurisdiction on amounts payable under this Section 4.11) payable
or paid by such Lender or the Administrative Agent (as the case may be) or
required to be withheld or deducted from a payment to such Person, and any
liability (including penalties, interest and expenses) arising therefrom or with
respect thereto, whether or not such Taxes or Other Taxes were correctly or
legally asserted. Such indemnification shall be made within thirty (30) days
from the date such Lender or the Administrative Agent (as the case may be) makes
written demand therefor.

(d) Evidence of Payment. Within thirty (30) days after the date of any payment
of Taxes or Other Taxes, the Borrowers shall furnish to the Administrative Agent
and the applicable Lender, at its address referred to in Section 13.1, the
original or a certified copy of a receipt evidencing payment thereof or other
evidence of payment satisfactory to the Administrative Agent.

(e) Delivery of Tax Forms. To the extent required by Applicable Law to reduce or
eliminate withholding or payment of taxes, each Lender and the Administrative
Agent shall deliver to the Company, with a copy to the Administrative Agent, on
the Closing Date or concurrently with the delivery of the relevant Assignment
and Assumption, as applicable, (i) two United States Internal Revenue Service
Forms W-9, Forms W-8ECI or Forms W-8BEN or W-BEN-E, as applicable (or successor
forms) properly completed and certifying in each case that such Lender is
entitled to a complete exemption from withholding or deduction for or on account
of any United States federal income taxes, and (ii) an Internal Revenue Service
Form W-8BEN or W-BEN-E, as applicable, or W-8ECI or successor applicable form,
as the case may be, to establish an exemption from United States backup
withholding taxes. Each such Lender further agrees to deliver to the Company,
with a copy to the Administrative Agent, as applicable, two Form W-9, Form
W-8BEN or W-BEN-E, as applicable, or W-8ECI, or successor applicable forms or
manner of certification, as the case may be, on or before the date that any such
form expires or becomes obsolete or after the occurrence of any event requiring
a change in the most recent form previously delivered by it to the Company,
certifying in the case of a Form W-9, Form W-8BEN or W-BEN-E, as applicable, or
W-8ECI (or successor forms) that such Lender is entitled to receive payments
under this Agreement without deduction or withholding of any United States
federal income taxes unless in any such case a Change in Law has occurred prior
to the date on which any such delivery would otherwise be required which renders
such forms inapplicable or the exemption to which such forms relate unavailable
and such Lender notifies the Company and the Administrative Agent that it is not
entitled to receive payments without deduction or withholding of United States
federal income taxes) and, in the case of a Form W-9, Form W-8BEN or W-BEN-E, as
applicable, or W-8ECI, establishing an exemption from United States backup
withholding tax. If a payment made to a Lender under any Loan Document would be
subject to U.S. federal withholding Tax imposed by FATCA if such Lender were to
fail to comply with the applicable reporting requirements of FATCA (including
those contained in

 

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Section 1471(b) or 1472(b) of the Code, as applicable), such Lender shall
deliver to the Company and the Administrative Agent at the time or times
prescribed by law and at such time or times reasonably requested by the Company
or the Administrative Agent such documentation prescribed by Applicable Law
(including as prescribed by Section 1471(b)(3)(C)(i) of the Code) and such
additional documentation reasonably requested by the Company or the
Administrative Agent as may be necessary for the Borrowers and the
Administrative Agent to comply with their obligations under FATCA and to
determine that such Lender has complied with such Lender’s obligations under
FATCA or to determine the amount to deduct and withhold from such payment. For
purposes of determining U.S. federal withholding Tax imposed under FATCA, from
and after the effective date of this Agreement, the Company and the
Administrative Agent shall treat (and the Lenders hereby authorize the
Administrative Agent to treat) the Agreement as not qualifying as a
“grandfathered obligation” within the meaning of Treasury Regulation
Section 1.1471-2(b)(2)(i). Solely for purposes of this Section 4.11(e), “FATCA”
shall include any amendments made to FATCA after the date of this Agreement.
Notwithstanding anything in any Loan Document to the contrary, the Borrowers
shall not be required to pay additional amounts to any Lender or the
Administrative Agent under Section 4.11 or Section 4.8(c), (i) if such Lender or
the Administrative Agent fails to comply with the requirements of this
Section 4.11(e), other than to the extent that such failure is due to a Change
in Law occurring after the date on which such Lender or the Administrative Agent
became a party to this Agreement or (ii) that are the result of such Lender’s or
the Administrative Agent’s gross negligence or willful misconduct, as
applicable, as determined by a court of competent jurisdiction by final and
nonappealable judgment.

(f) Survival. Without prejudice to the survival of any other agreement of any
Borrower hereunder, the agreements and obligations of the Borrowers contained in
this Section 4.11 shall survive the payment in full of the Obligations and the
termination of the Revolving Credit Commitments.

(g) Each Lender shall severally indemnify the Administrative Agent, within 10
days after demand therefor, for (i) for the full amount of Taxes and Other Taxes
(including, without limitation, any Taxes and Other Taxes imposed by any
jurisdiction on amounts payable under this Section 4.11) attributable to such
Lender (but only to the extent that the Borrowers have not already indemnified
the Administrative Agent for such Taxes and Other Taxes and without limiting the
obligation of the Borrowers to do so), (ii) any Taxes attributable to such
Lender’s failure to comply with the provisions of Section 13.9(f) relating to
the maintenance of a Participant Register and (iii) any taxes attributable to
such Lender not included in the definition of “Taxes”, in each case, that are
payable or paid by the Administrative Agent in connection with any Loan
Document, and any reasonable expenses arising therefrom or with respect thereto,
whether or not such Taxes were correctly or legally imposed or asserted by the
relevant Governmental Authority. A certificate as to the amount of such payment
or liability delivered to any Lender by the Administrative Agent shall be
conclusive absent manifest error. Each Lender hereby authorizes the
Administrative Agent to set off and apply any and all amounts at any time owing
to such Lender under any Loan Document or otherwise payable by the
Administrative Agent to the Lender from any other source against any amount due
to the Administrative Agent under this paragraph (g).

 

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Section 4.12 Mitigation Obligations; Replacement of Lenders.

(a) Designation of a Different Lending Office. If any Lender requests
compensation under Section 4.8(c) or Section 4.10, or requires the Borrowers to
pay any additional amount to any Lender or any Governmental Authority for the
account of any Lender pursuant to Section 4.11, then, if requested by any
Borrower, such Lender shall use reasonable efforts to designate a different
lending office for funding or booking its Loans hereunder or to assign its
rights and obligations hereunder to another of its offices, branches or
affiliates, if, in the judgment of such Lender, such designation or assignment
(i) would eliminate or reduce amounts payable pursuant to Section 4.8(c),
Section 4.10 or Section 4.11, as the case may be, in the future and (ii) would
not subject such Lender to any unreimbursed cost or expense and would not
otherwise be disadvantageous to such Lender. The Borrowers hereby agree to pay
all reasonable costs and expenses incurred by any Lender in connection with any
such designation or assignment.

(b) Replacement of Lenders. If any Lender requests compensation under
Section 4.8(c) or Section 4.10, or if the Borrowers are required to pay any
additional amount to any Lender or any Governmental Authority for the account of
any Lender pursuant to Section 4.11 or Section 4.12(a), or if any Lender is a
Defaulting Lender hereunder, then the Borrowers may, at their sole expense and
effort, upon notice to such Lender and the Administrative Agent, require such
Lender to assign and delegate, without recourse (in accordance with and subject
to the restrictions contained in, and consents required by, Section 13.9), 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:

(i) the Borrowers shall have paid to the Administrative Agent the assignment fee
specified in Section 13.9;

(ii) such Lender shall have received payment of an amount equal to the
outstanding principal of its Loans and participations in Letters of Credit,
accrued interest payable thereon, accrued fees and all other amounts payable to
it hereunder and under the other Loan Documents (including any amounts under
Section 4.9) from the assignee (to the extent of such outstanding principal and
accrued interest and fees) or the Borrower (in the case of all other amounts);

(iii) in the case of any such assignment resulting from a claim for compensation
under Section 4.10 or payments required to be made pursuant to Section 4.11,
such assignment will result in a reduction in such compensation or payments
thereafter; and

(iv) such assignment does not conflict with Applicable Law.

A Lender shall not be required to make any such assignment or delegation if,
prior thereto, as a result of a waiver by such Lender or otherwise, the
circumstances entitling the Borrowers to require such assignment and delegation
cease to apply.

 

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Section 4.13 Defaulting Lenders. 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:

(a) 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 Section 13.10.

(b) 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, or otherwise, and including
any amounts made available to the Administrative Agent for the account of such
Defaulting Lender pursuant to Section 13.3), shall be applied at such time or
times as may be determined by the Administrative Agent as follows: first, to the
payment of any amounts owing by such Defaulting Lender to the Administrative
Agent hereunder; second, to the payment on a pro rata basis of any amounts owing
by such Defaulting Lender to the Issuing Lenders and/or the Swingline Lender
hereunder; third, if so determined by the Administrative Agent or requested by
any Issuing Lender and/or the Swingline Lender, to be held as cash collateral
for future funding obligations of such Defaulting Lender of any participation in
any Swingline Loan or Letter of Credit (until such time as such Lender is no
longer a Defaulting Lender and to the extent not applied towards such funding
obligations); fourth, as the Borrower may request (so long as no Default or
Event of Default exists), to the funding of any Loan in respect of which such
Defaulting Lender has failed to fund its portion thereof as required by this
Agreement, as determined by the Administrative Agent; fifth, if so determined by
the Administrative Agent and the Borrowers, to be held in a non-interest bearing
deposit account and released in order to satisfy obligations of such Defaulting
Lender to fund Loans under this Agreement; sixth, to the payment of any amounts
owing to the Administrative Agent, the Lenders, the Issuing Lenders or Swingline
Lender as a result of any judgment of a court of competent jurisdiction obtained
by the Administrative Agent, any Lender, any Issuing Lender or Swingline Lender
against such Defaulting Lender as a result of such Defaulting Lender’s breach of
its obligations under this Agreement; seventh, so long as no Default or Event of
Default exists, to the payment of any amounts owing to the Borrower as a result
of any judgment of a court of competent jurisdiction obtained by the Borrower
against such Defaulting Lender as a result of such Defaulting Lender’s breach of
its obligations under this Agreement; and eighth, to such Defaulting Lender or
as otherwise directed by a court of competent jurisdiction; provided that if
(i) such payment is a payment of the principal amount of any Revolving Credit
Loans or funded participations in Swingline Loans or Letters of Credit in
respect of which such Defaulting Lender has not fully funded its appropriate
share and (ii) such Revolving Credit Loans or funded participations in Swingline
Loans or Letters of Credit were made at a time when the conditions set forth in
Section 5.2 were satisfied or waived, such payment shall be applied solely to
pay the Revolving Credit Loans of, and funded participations in Swingline Loans
or Letters of Credit owed to, all Non-Defaulting Lenders on a pro rata basis
prior to being applied to the payment of any Revolving Credit Loans of, or
funded participations in Swingline Loans or Letters of Credit 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 4.13(b)
shall be deemed paid to and redirected by such Defaulting Lender, and each
Lender irrevocably consents hereto.

 

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(c) Reallocation of Applicable Percentages to Reduce Fronting Exposure. During
any period in which there is a Defaulting Lender, all or any part of such
Defaulting Lender’s participation in L/C Obligations and Swingline Loans shall
be reallocated among the Non-Defaulting Lenders in accordance with their
respective Revolving Credit Commitment Percentages (calculated without regard to
such Defaulting Lender’s Revolving Credit Commitment) but only to the extent
that such reallocation does not cause the aggregate Extensions of Credit of any
Non-Defaulting Lender to exceed such Non-Defaulting Lender’s Revolving Credit
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.

(d) Cash Collateral for Letters of Credit. Promptly on written demand to the
Borrowers by the Issuing Lender or the Administrative Agent from time to time,
the Borrowers shall deliver to the Administrative Agent cash collateral in an
amount sufficient to cover all Fronting Exposure with respect to the Issuing
Lender (after giving effect to Section 4.13(c)) on terms reasonably satisfactory
to the Administrative Agent and the Issuing Lender (and such cash collateral
shall be in Dollars). Any such cash collateral shall be deposited in a separate
account with the Administrative Agent, subject to the exclusive dominion and
control of the Administrative Agent, as collateral (solely for the benefit of
the Issuing Lender) for the payment and performance of each Defaulting Lender’s
Revolving Credit Commitment Percentage of outstanding L/C Obligations. Moneys in
such account (a) shall be applied by the Administrative Agent to reimburse the
Issuing Lender immediately for each Defaulting Lender’s Revolving Credit
Commitment Percentage of any drawing under any Letter of Credit that has not
otherwise been reimbursed by the Borrower or such Defaulting Lender and (b) to
the extent not applied to reimburse the Issuing Lender, shall be returned
promptly to the Borrowers when all Lenders are Non-Defaulting Lenders.

(e) Prepayment of Swingline Loans. Promptly on demand by the Swingline Lender or
the Administrative Agent from time to time, the Borrowers shall prepay Swingline
Loans in an amount of all Fronting Exposure with respect to the Swingline Lender
(after giving effect to Section 4.13(c)).

(f) Certain Fees. For any period during which such Lender is a Defaulting
Lender, such Defaulting Lender (i) shall not be entitled to receive any
commitment fee pursuant to Section 4.3 and the Borrower shall not be required to
pay any such fee that otherwise would have been required to have been paid to
such Defaulting Lender) and (ii) shall not be entitled to receive any letter of
credit commissions pursuant to Section 3.3(a) otherwise payable to the account
of a Defaulting Lender with respect to any Letter of Credit as to which such
Defaulting Lender has not provided cash collateral or other credit support
arrangements satisfactory to the Issuing Lender pursuant to Section 4.13(d), but
instead, the Borrowers shall pay to the Non-Defaulting Lenders the amount of
such letter of credit commissions in accordance with the upward adjustments in
their respective Revolving Credit Commitment Percentages allocable to such
Letter of Credit pursuant to Section 4.13(c), with the balance of such fee, if
any, payable to the Issuing Lenders for their own account ratably based upon
their sharing of the aggregate Fronting Exposure.

 

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(g) Defaulting Lender Cure. If the Borrowers, the Administrative Agent, the
Swingline Lender and the Issuing Lenders agree in writing in their sole
discretion that a Defaulting Lender should no longer be deemed to be a
Defaulting Lender, the Administrative Agent will so notify the parties hereto,
whereupon as of the 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 that portion
of outstanding Revolving Credit Loans of the other Lenders or take such other
actions as the Administrative Agent may determine to be necessary to cause the
Revolving Credit Loans and funded and unfunded participations in Letters of
Credit and Swingline Loans to be held on a pro rata basis by the Lenders in
accordance with their Revolving Credit Commitment Percentages (without giving
effect to Section 4.13(c)), whereupon such Lender will cease to be a Defaulting
Lender; provided that no adjustments will be made retroactively with respect to
fees accrued or payments made by or on behalf of the Borrowers while such 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 such Lender’s having been a Defaulting Lender.

ARTICLE V

CLOSING; CONDITIONS OF CLOSING AND BORROWING

Section 5.1 Conditions to Closing and Initial Extensions of Credit. The
obligation of the Lenders to close this Agreement and to make the initial Loan
or Issue or participate in any Letter of Credit is subject to the satisfaction
of each of the following conditions:

(a) Executed Loan Documents. This Agreement and the Notes (to the extent
requested by any Lender), together with any other applicable Loan Documents,
shall have been duly authorized, executed and delivered to the Administrative
Agent by the parties thereto, shall be in full force and effect and no Default
or Event of Default shall exist thereunder, and the Borrowers shall have
delivered original counterparts thereof to the Administrative Agent.

(b) Closing Certificates; etc.

(i) Officer’s Certificate of the Borrowers. The Administrative Agent shall have
received a certificate from a Responsible Officer, in form and substance
satisfactory to the Administrative Agent, to the effect that all representations
and warranties of the Borrowers contained in this Agreement and the other Loan
Documents are true, correct and complete; that the Borrowers are not in
violation of any of the covenants contained in this Agreement and the other Loan
Documents; that, after giving effect to the transactions contemplated by this
Agreement, no Default or Event of Default has occurred and is continuing; and
that the Borrowers have satisfied each of the closing conditions.

(ii) Certificate of Secretary of the Borrowers. The Administrative Agent shall
have received a certificate of the secretary or assistant secretary of each
Borrower certifying as to the incumbency and genuineness of the signature of
each officer of each Borrower executing Loan Documents to which it is a party,
certifying that

 

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the articles of incorporation or formation and bylaws, operating agreement or
other governing document of such Borrower delivered pursuant to the Existing
Credit Agreement continue unchanged (or, if applicable, specifying the nature of
any changes thereto) and remain in full force and effect as of the date hereof,
and certifying that attached thereto is a true, correct and complete copy of
(A) resolutions duly adopted by the board of directors or other governing body
of each Borrower authorizing the transactions contemplated hereunder and the
execution, delivery and performance of this Agreement and the other Loan
Documents to which it is a party and (B) each certificate required to be
delivered pursuant to Section 5.1(b)(iii).

(iii) Certificates of Good Standing. The Administrative Agent shall have
received certificates as of a recent date of the good standing of each Borrower
under the laws of its jurisdiction of organization and, to the extent requested
by the Administrative Agent, each other jurisdiction where such Borrower is
qualified to do business.

(iv) Opinions of Counsel. The Administrative Agent shall have received favorable
opinions of counsel to the Borrowers addressed to the Administrative Agent and
the Lenders with respect to the Borrowers, the Loan Documents and such other
matters as the Lenders shall request.

(v) Tax Forms. The Administrative Agent shall have received copies of the United
States Internal Revenue Service forms required by Section 4.11(e) hereof.

(c) Consents; Defaults.

(i) Governmental and Third Party Approvals. The Borrowers shall have obtained
all necessary approvals, authorizations and consents of any Person and of all
Governmental Authorities and courts having jurisdiction with respect to the
transactions contemplated by this Agreement and the other Loan Documents.

(ii) No Injunction, Etc. No action, proceeding (including, without limitation, a
bankruptcy or insolvency proceeding), investigation, regulation or legislation
shall have been instituted, threatened or proposed before any Governmental
Authority to enjoin, restrain, or prohibit, or to obtain substantial damages in
respect of, or which is related to or arises out of this Agreement or the other
Loan Documents or the consummation of the transactions contemplated hereby or
thereby, or which, in the Administrative Agent’s sole discretion, would make it
inadvisable to consummate the transactions contemplated by this Agreement and
such other Loan Documents.

(iii) No Event of Default. No Default or Event of Default shall have occurred
and be continuing.

(d) Financial Matters.

(i) Financial Statements. The Administrative Agent shall have received (A) the
audited Consolidated financial statements of the Borrowers and their
Subsidiaries as of February 1, 2014 and (B) the unaudited Consolidated financial
statements of the Borrowers and their Subsidiaries as of August 2, 2014.

 

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(ii) Financial Condition Certificate. The Borrowers shall have delivered to the
Administrative Agent a certificate, in form and substance satisfactory to the
Administrative Agent, and certified as accurate by a Responsible Officer, that
(A) after giving effect to the transactions contemplated hereby, (1) each of
(x) the Company, individually, and (y) the other Borrowers and their
Subsidiaries, considered with the Company as a whole are Solvent, (2) attached
thereto are calculations evidencing compliance on a pro forma basis with the
covenants contained in Article IX hereof, (3) the financial projections
previously delivered to the Administrative Agent represent the good faith
estimates (utilizing reasonable assumptions) of the financial condition and
operations of the Borrowers and their Subsidiaries and (B) attached thereto is a
calculation of the Applicable Margin pursuant to Section 4.1(c).

(iii) Payment at Closing; Fee Letters. The Borrowers shall have paid to the
Administrative Agent and the Lenders the fees set forth or referenced in
Section 4.3 and any other accrued and unpaid fees or commissions due hereunder
(including, without limitation, legal fees and expenses) and to any other Person
such amount as may be due thereto in connection with the transactions
contemplated hereby, including all taxes, fees and other charges in connection
with the execution, delivery, recording, filing and registration of any of the
Loan Documents.

(e) Miscellaneous.

(i) Payments under Existing Credit Agreement. (A) all accrued but unpaid
interest and fees under the Existing Credit Agreement shall be paid in cash (by
wire transfer) in full on the Closing Date, and (B) all reasonable fees,
expenses and disbursements of counsel to Administrative Agent shall be paid in
cash (by wire transfer) in full on the Closing Date. The Borrowers acknowledge
that there are no Revolving Credit Loans outstanding under the Existing Credit
Agreement on the Closing Date.

(ii) Existing Letters of Credit. The Administrative Agent shall have received
evidence to its satisfaction that there are no outstanding unpaid draws or any
existing default or event of default under the Existing Letters of Credit or
under any of the Loan Documents related thereto.

(iii) Regulatory Information. The Administrative Agent shall have received from
the Borrowers all documentation and other information requested by the
Administrative Agent that is required to satisfy applicable “know your customer”
and anti-money laundering rules and regulations, including without limitation
the Patriot Act.

(iv) Other Documents. All opinions, certificates and other instruments and all
proceedings in connection with the transactions contemplated by this Agreement
shall be satisfactory in form and substance to the Administrative Agent. The
Administrative Agent shall have received copies of all other documents,
certificates and instruments reasonably requested thereby, with respect to the
transactions contemplated by this Agreement.

 

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Without limiting the generality of the provisions of the last paragraph of
Section 12.3, for purposes of determining compliance with the conditions
specified in this Section 5.1, 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.

Section 5.2 Conditions to All Extensions of Credit. The obligations of the
Lenders to make any Extensions of Credit (including the initial Extension of
Credit), participate in any Letter of Credit, convert or continue any Loan
and/or the Issuing Lenders to issue or extend any Letter of Credit are subject
to the satisfaction of the following conditions precedent on the relevant
borrowing, continuation, conversion, Issuance or extension date:

(a) Continuation of Representations and Warranties. The representations and
warranties contained in Article VI shall be true and correct on and as of such
borrowing, continuation, conversion or Issuance date with the same effect as if
made on and as of such date; except for any representation and warranty made as
of an earlier date, which representation and warranty shall remain true and
correct as of such earlier date.

(b) No Existing Default. No Default or Event of Default shall have occurred and
be continuing (i) on the borrowing, continuation or conversion date with respect
to such Loan or after giving effect to the Loans to be made, continued or
converted on such date or (ii) on the Issuance date with respect to such Letter
of Credit or after giving effect to the Issuance of such Letter of Credit on
such date.

(c) Notices. The Administrative Agent shall have received a Notice of Borrowing
or Notice of Conversion/Continuation, as applicable, from the Borrowers in
accordance with Section 2.3(a).

(d) Additional Documents. The Administrative Agent shall have received each
additional document, instrument, legal opinion or other item reasonably
requested by it.

ARTICLE VI

REPRESENTATIONS AND WARRANTIES OF THE BORROWERS

Section 6.1 Representations and Warranties. To induce the Administrative Agent
and Lenders to enter into this Agreement and to induce the Lenders to make
Extensions of Credit and/or participate in the Existing Letters of Credit, the
Borrowers hereby represent and warrant to the Administrative Agent and Lenders
both before and after giving effect to the transactions contemplated hereunder
that:

(a) Organization; Power; Qualification. Each of the Borrowers and their
Subsidiaries is duly organized, validly existing and in good standing under the
laws of the

 

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jurisdiction of its incorporation or formation, has the power and authority to
own its properties and to carry on its business as now being and hereafter
proposed to be conducted and is duly qualified and authorized to do business in
each jurisdiction in which the character of its properties or the nature of its
business requires such qualification and authorization. The jurisdictions in
which the Borrowers and their Subsidiaries are organized and qualified to do
business as of the Closing Date are described on Schedule 6.1(a).

(b) Ownership. Each Subsidiary of any Borrower as of the Closing Date is listed
on Schedule 6.1(b). As of the Closing Date, the capitalization of the Borrowers
and their Subsidiaries consists of the number of shares, authorized, issued and
outstanding, of such classes and series, with or without par value, described on
Schedule 6.1(b). All outstanding shares have been duly authorized and validly
issued and are fully paid and nonassessable, with no personal liability
attaching to the ownership thereof, and not subject to any preemptive or similar
rights. The shareholders of the Subsidiaries of each Borrower and the number of
shares owned by each as of the Closing Date are described on Schedule 6.1(b). As
of the Closing Date, there are no outstanding stock purchase warrants,
subscriptions, options, securities, instruments or other rights of any type or
nature, which are convertible into Debt or which are exchangeable for or
otherwise provide for or permit the issuance of capital stock of the Borrowers
or their Subsidiaries in an amount which in the aggregate for any Borrower or
Subsidiary exceeds twenty (20%) percent of the issued and outstanding capital
stock of such Borrower or Subsidiary.

(c) Authorization of Agreement, Loan Documents and Borrowing. Each of the
Borrowers and their Subsidiaries has the right, power and authority and has
taken all necessary corporate and other action to authorize the execution,
delivery and performance of this Agreement and each of the other Loan Documents
to which it is a party in accordance with their respective terms. This Agreement
and each of the other Loan Documents have been duly executed and delivered by
the duly authorized officers of each Borrower and each of its Subsidiaries party
thereto, and each such document constitutes the legal, valid and binding
obligation of each Borrower or its Subsidiary party thereto, enforceable in
accordance with its terms, except as such enforceability may be limited by
Debtor Relief Laws from time to time in effect which affect the enforcement of
creditors’ rights in general and the availability of equitable remedies.

(d) Compliance of Agreement, Loan Documents and Borrowing with Laws, Etc. The
execution, delivery and performance by the Borrowers and their Subsidiaries of
the Loan Documents to which each such Person is a party, in accordance with
their respective terms, the Extensions of Credit hereunder and the transactions
contemplated hereby do not and will not, by the passage of time, the giving of
notice or otherwise, (i) require any Governmental Approval or violate any
Applicable Law relating to the Borrowers or any of their Subsidiaries,
(ii) conflict with, result in a breach of or constitute a default under the
articles of incorporation, bylaws or other organizational documents of any
Borrower or any of its Subsidiaries or any indenture, agreement or other
instrument to which such Person is a party or by which any of its properties may
be bound or any Governmental Approval relating to such Person, (iii) result in
or require the creation or imposition of any Lien upon or with respect to any
property now owned or hereafter acquired by such Person other than Liens arising
under the Loan Documents or (iv) require any consent or authorization of, filing
with, or other act in respect of, an arbitrator or Governmental Authority and no
consent of any other Person is required in connection with the execution,
delivery, performance, validity or enforceability of this Agreement.

 

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(e) Compliance with Law; Governmental Approvals. Except in each case where the
failure to so comply could not reasonably be expected to have a Material Adverse
Effect, each of the Borrowers and its Subsidiaries (i) has all Governmental
Approvals required by any Applicable Law for it to conduct its business, each of
which is in full force and effect, is final and not subject to review on appeal
and is not the subject of any pending or, to the best of its knowledge,
threatened attack by direct or collateral proceeding, (ii) is in compliance with
each Governmental Approval applicable to it and in compliance with all other
Applicable Laws relating to it or any of its respective properties and (iii) has
timely filed all material reports, documents and other materials required to be
filed by it under all Applicable Laws with any Governmental Authority and has
retained all material records and documents required to be retained by it under
Applicable Law.

(f) Tax Returns and Payments. Each of the Borrowers and its Subsidiaries has
duly filed or caused to be filed all federal, state, local and other tax returns
required by Applicable Law to be filed, and has paid, or made adequate provision
for the payment of, all federal, state, local and other taxes, assessments and
governmental charges or levies upon it and its property, income, profits and
assets which are due and payable. Such returns accurately reflect in all
material respects all liability for taxes of the Borrowers and their
Subsidiaries for the periods covered thereby. Except as set forth on Schedule
6.1(f), there is no ongoing audit or examination or, to the knowledge of any
Borrower, other investigation by any Governmental Authority of the tax liability
of any Borrower and its Subsidiaries. No Governmental Authority has asserted any
Lien or other claim against any Borrower or any Subsidiary thereof with respect
to unpaid taxes which has not been discharged or resolved. The charges, accruals
and reserves on the books of the Borrowers and any of their Subsidiaries in
respect of federal, state, local and other taxes for all Fiscal Years and
portions thereof since the organization of each Borrower and any of its
Subsidiaries are in the judgment of the Borrowers adequate, and such Borrower
does not anticipate any additional taxes or assessments for any of such years.

(g) Intellectual Property Matters. Each of the Borrowers and its Subsidiaries
owns or possesses rights to use all franchises, licenses, copyrights, copyright
applications, patents, patent rights or licenses, patent applications,
trademarks, trademark rights, service mark, service mark rights, trade names,
trade name rights, copyrights and rights with respect to the foregoing which are
required to conduct its business. No event has occurred which permits, or after
notice or lapse of time or both would permit, the revocation or termination of
any such rights, and neither the Borrowers nor any Subsidiaries thereof are
liable to any Person for infringement under Applicable Law with respect to any
such rights as a result of its business operations.

(h) Environmental Matters.

(i) To the best of each Borrower’s knowledge, the properties owned, leased or
operated by any Borrower and its Subsidiaries now or in the past do not contain,
and have not previously contained, any Hazardous Materials in amounts or
concentrations which (A) constitute or constituted a violation of applicable
Environmental Laws or (B) could give rise to liability under applicable
Environmental Laws;

 

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(ii) To the best of each Borrower’s knowledge, each Borrower, each Subsidiary
and such properties and all operations conducted in connection therewith are in
compliance, and have been in compliance, with all applicable Environmental Laws,
and there is no contamination at, under or about such properties or such
operations which could interfere with the continued operation of such properties
or impair the fair saleable value thereof;

(iii) No Borrower or any Subsidiary thereof has received any notice of
violation, alleged violation, non-compliance, liability or potential liability
regarding environmental matters, Hazardous Materials, or compliance with
Environmental Laws, nor does any Borrower or any Subsidiary thereof have
knowledge or reason to believe that any such notice will be received or is being
threatened;

(iv) To the best of each Borrower’s knowledge, Hazardous Materials have not been
transported or disposed of to or from the properties owned, leased or operated
by any Borrower and its Subsidiaries in violation of, or in a manner or to a
location which could give rise to liability under, Environmental Laws, nor have
any Hazardous Materials been generated, treated, stored or disposed of at, on or
under any of such properties in violation of, or in a manner that could give
rise to liability under, any applicable Environmental Laws;

(v) No judicial proceedings or governmental or administrative action is pending,
or, to the knowledge of any Borrower, threatened, under any Environmental Law to
which any Borrower or any Subsidiary thereof is or will be named as a
potentially responsible party with respect to such properties or operations
conducted in connection therewith, nor are there any consent decrees or other
decrees, consent orders, administrative orders or other orders, or other
administrative or judicial requirements outstanding under any Environmental Law
with respect to any Borrower, any Subsidiary or such properties or such
operations; and

(vi) To the best of each Borrower’s knowledge, there has been no release or
threat of release of Hazardous Materials at or from properties owned, leased or
operated by any Borrower or any Subsidiary, now or in the past, in violation of
or in amounts or in a manner that could give rise to liability under
Environmental Laws.

(i) ERISA.

(i) As of the Closing Date, no Borrower or any ERISA Affiliate maintains or
contributes to, or has any obligation under, any Employee Benefit Plans other
than those identified on Schedule 6.1(i);

(ii) Each Borrower and each ERISA Affiliate is in material compliance with all
applicable provisions of ERISA, the Code and the regulations and published
interpretations thereunder with respect to all Employee Benefit Plans except for
any required amendments for which the remedial amendment period as defined in
Section

 

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401(b) of the Code has not yet expired and except where a failure to so comply
could not reasonably be expected to have a Material Adverse Effect. Each
Employee Benefit Plan that is intended to be qualified under Section 401(a) of
the Code has been determined by the Internal Revenue Service to be so qualified,
and each trust related to such plan has been determined to be exempt under
Section 501(a) of the Code except for such plans that have not yet received
determination letters but for which the remedial amendment period for submitting
a determination letter has not yet expired. No liability has been incurred by
any Borrower or any ERISA Affiliate which remains unsatisfied for any taxes or
penalties with respect to any Employee Benefit Plan or any Multiemployer Plan
except for a liability that could not reasonably be expected to have a Material
Adverse Effect;

(iii) As of the Closing Date, no Pension Plan has been terminated, nor has any
Pension Plan become subject to funding based benefit restrictions under
Section 436 of the Code, nor has any funding waiver from the Internal Revenue
Service been received or requested with respect to any Pension Plan, nor has any
Borrower or any ERISA Affiliate failed to make any contributions or to pay any
amounts due and owing as required by Sections 412 or 430 of the Code or
Section 302 of ERISA prior to the due dates of such contributions under Sections
412 or 430 of the Code or Section 302 of ERISA, nor has there been any event
requiring any disclosure under Section 4041(c)(3)(C) or 4063(a) of ERISA with
respect to any Pension Plan;

(iv) Except where the failure of any of the following representations to be
correct in all material respects could not reasonably be expected to have a
Material Adverse Effect, no Borrower or any ERISA Affiliate has: (A) engaged in
a nonexempt prohibited transaction described in Section 406 of the ERISA or
Section 4975 of the Code, (B) incurred any liability to the PBGC which remains
outstanding other than the payment of premiums and there are no premium payments
which are due and unpaid, (C) failed to make a required contribution or payment
to a Multiemployer Plan, or (D) failed to make a required installment or other
required payment under Sections 412 or 430 of the Code;

(v) No Termination Event has occurred or is reasonably expected to occur; and

(vi) Except where the failure of any of the following representations to be
correct in all material respects could not reasonably be expected to have a
Material Adverse Effect, no proceeding, claim (other than a benefits claim in
the ordinary course of business), lawsuit and/or investigation is existing or,
to the best knowledge of any Borrower after due inquiry, threatened concerning
or involving any (A) employee welfare benefit plan (as defined in Section 3(1)
of ERISA) currently maintained or contributed to by any Borrower or any ERISA
Affiliate, (B) Pension Plan or (C) Multiemployer Plan.

(j) Margin Stock. No Borrower or any Subsidiary thereof is engaged principally
or as one of its activities in the business of extending credit for the purpose
of “purchasing” or “carrying” any “margin stock” (as each such term is defined
or used, directly or indirectly, in Regulation U of the Board of Governors of
the Federal Reserve System). No part

 

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of the proceeds of any of the Loans or Letters of Credit will be used for
purchasing or carrying margin stock or for any purpose which violates, or which
would be inconsistent with, the provisions of Regulation T, U or X of such Board
of Governors. Following the application of the proceeds of each Extension of
Credit, not more than twenty-five percent (25%) of the value of the assets
(either of any of the Borrowers, individually, or of the Borrowers and their
Subsidiaries on a Consolidated basis) subject to the provisions of Section 10.2
or Section 10.5 or subject to any restriction contained in any agreement or
instrument between any of the Borrowers and any Lender or any Affiliate of any
Lender relating to Indebtedness in excess of $10,000,000 will be “margin stock”.
If requested by any Lender (through the Administrative Agent) or the
Administrative Agent, the Borrowers will furnish to the Administrative Agent and
each Lender a statement to the foregoing effect in conformity with the
requirements of FR Form G-3 or FR Form U 1 referred to in Regulation U.

(k) Government Regulation. No Borrower or any Subsidiary thereof is an
“investment company” or a company “controlled” by an “investment company” (as
each such term is defined or used in the Investment Company Act of 1940, as
amended) and no Borrower or any Subsidiary thereof is, or after giving effect to
the transactions contemplated by this Agreement will be, subject to regulation
under the Interstate Commerce Act, as amended, or any other Applicable Law that
limits its ability to incur or consummate the transactions contemplated hereby.

(l) Material Contracts. Schedule 6.1(l) sets forth a complete and accurate list
of all Material Contracts of any Borrower and its Subsidiaries in effect as of
the Closing Date not listed on any other Schedule hereto; other than as set
forth in Schedule 6.1(l), each such Material Contract is, and after giving
effect to the consummation of the transactions contemplated by the Loan
Documents will be, in full force and effect in accordance with the terms
thereof. No Borrower or any Subsidiary (nor, to the knowledge of any Borrower,
any other party thereto) is in breach of or in default under any Material
Contract in any material respect.

(m) Employee Relations. Each Borrower and its Subsidiaries has a stable work
force in place and is not, as of the Closing Date, party to any collective
bargaining agreement nor has any labor union been recognized as the
representative of its employees except as set forth on Schedule 6.1(m). No
Borrower knows of any pending, threatened or contemplated strikes, work stoppage
or other collective labor disputes involving its employees or those of its
Subsidiaries.

(n) Burdensome Provisions. No Borrower or any Subsidiary thereof is a party to
any indenture, agreement, lease or other instrument, or subject to any corporate
or partnership restriction, Governmental Approval or Applicable Law which is so
unusual or burdensome as in the foreseeable future could be reasonably expected
to have a Material Adverse Effect. The Borrowers and their Subsidiaries do not
presently anticipate that future expenditures needed to meet the provisions of
any statutes, orders, rules or regulations of a Governmental Authority will be
so burdensome as to have a Material Adverse Effect. No Subsidiary is party to
any agreement or instrument or otherwise subject to any restriction or
encumbrance that restricts or limits its ability to make dividend payments or
other distributions in respect of its capital stock to its parent Borrower or
any Subsidiary or to transfer any of its assets or properties to its parent
Borrower or any other Subsidiary in each case other than existing under or by
reason of the Loan Documents or Applicable Law.

 

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(o) Financial Statements. The audited and unaudited financial statements
delivered pursuant to Section 5.1(d)(i), are complete and correct and fairly
present on a Consolidated basis the assets, liabilities and financial position
of the Borrowers and their Subsidiaries as at such dates, and the results of the
operations and changes of financial position for the periods then ended (other
than customary year-end adjustments for unaudited financial statements). All
such financial statements, including the related schedules and notes thereto,
have been prepared in accordance with GAAP. The Borrowers and their Subsidiaries
have no Debt, obligation or other unusual forward or long-term commitment which
is not fairly reflected in the foregoing financial statements or in the notes
thereto.

(p) No Material Adverse Change. Since February 1, 2014, there has been no
material adverse change in the properties, business, operations, prospects, or
condition (financial or otherwise) of the Borrowers and their Subsidiaries and
no event has occurred or condition arisen that could reasonably be expected to
have a Material Adverse Effect.

(q) Solvency. As of the Closing Date and after giving effect to each Extension
of Credit made hereunder, each of (i) the Company, individually, and (ii) the
other Borrowers and their Subsidiaries, considered with the Company as a whole,
will be Solvent.

(r) Titles to Properties. Each Borrower and its Subsidiaries has such title to
the real property owned or leased by it as is necessary or desirable to the
conduct of its business and valid and legal title to all of its personal
property and assets, including, but not limited to, those reflected on the
balance sheets of the Borrowers and their Subsidiaries delivered pursuant to
Section 6.1(o), except those which have been disposed of by such Borrower or its
Subsidiaries subsequent to such date which dispositions have been in the
ordinary course of business, or as otherwise expressly permitted hereunder.

(s) Liens. None of the properties and assets of any Borrower or any Subsidiary
thereof is subject to any Lien, except Liens permitted pursuant to Section 10.2.
No financing statement under the Uniform Commercial Code of any state which
names any Borrower or any Subsidiary thereof or any of their respective trade
names or divisions as debtor and which has not been terminated, has been filed
in any state or other jurisdiction and no Borrower or any Subsidiary thereof has
signed any such financing statement or any security agreement authorizing any
secured party thereunder to file any such financing statement, except to perfect
those Liens permitted by Section 10.2 hereof.

(t) Debt and Guaranty Obligations. Schedule 6.1(t) is a complete and correct
listing of all Debt and Guaranty Obligations of each Borrower and its
Subsidiaries as of the Closing Date in excess of $5,000,000. Each Borrower and
its Subsidiaries have performed and are in compliance with all of the terms of
such Debt and Guaranty Obligations and all instruments and agreements relating
thereto, and no default or event of default, or event or condition which with
notice or lapse of time or both would constitute such a default or event of
default on the part of any Borrower or any of its Subsidiaries exists with
respect to any such Debt or Guaranty Obligation.

 

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(u) Litigation. Except for matters existing on the Closing Date and set forth on
Schedule 6.1(u), there are no actions, suits or proceedings pending nor, to the
knowledge of any Borrower, threatened against or in any other way relating
adversely to or affecting any Borrower or any Subsidiary thereof or any of their
respective properties in any court or before any arbitrator of any kind or
before or by any Governmental Authority except for any such actions, suits or
proceedings which individually and in the aggregate could not reasonably be
expected to have a Material Adverse Effect.

(v) Absence of Defaults. No event has occurred or is continuing which
constitutes a Default or an Event of Default, or which constitutes, or which
with the passage of time or giving of notice or both would constitute, a default
or event of default by any Borrower or any Subsidiary thereof under any Material
Contract or judgment, decree or order to which such Borrower or its Subsidiaries
is a party or by which such Borrower or its Subsidiaries or any of their
respective properties may be bound or which would require such Borrower or its
Subsidiaries to make any payment thereunder prior to the scheduled maturity date
therefor.

(w) Senior Debt Status. The Obligations of the Borrowers and each of their
Subsidiaries under this Agreement and each of the other Loan Documents ranks and
shall continue to rank at least senior in priority of payment to all
Subordinated Debt of each such Person and is designated as “Senior Indebtedness”
under all instruments and documents, now or in the future, relating to all
Subordinated Debt and all senior unsecured Debt of such Person.

(x) Accuracy and Completeness of Information. All written information, reports
and other papers and data produced by or on behalf of each Borrower or any
Subsidiary thereof (other than financial projections, which shall be subject to
the standard set forth in Section 7.1(c)) and furnished to the Lenders were, at
the time the same were so furnished, complete and correct in all material
respects to the extent necessary to give the recipient a true and accurate
knowledge of the subject matter. No document furnished or written statement made
to the Administrative Agent or the Lenders by any Borrower or any Subsidiary
thereof in connection with the negotiation, preparation or execution of this
Agreement or any of the Loan Documents contains or will contain any untrue
statement of a fact material to the creditworthiness of each Borrower or its
Subsidiaries or omits or will omit to state a fact necessary in order to make
the statements contained therein not misleading. No Borrower is aware of any
facts which it has not disclosed in writing to the Administrative Agent having a
Material Adverse Effect, or insofar as such Borrower can now foresee, which
could reasonably be expected to have a Material Adverse Effect.

(y) Designated Persons; Sanctions; Patriot Act.

(i) No Borrower or its Subsidiaries, and to each Borrower’s knowledge, none of
their respective directors, officers or employees (i) is a Designated Person,
(ii) is a Person that is owned or controlled by a Designated Person or (iii) is
located, organized or resident in a Sanctioned Country.

(ii) No Borrower or its Subsidiaries, and to each Borrower’s knowledge, none of
their respective directors, officers or employees is now, directly or indirectly
engaged in any material dealings or transactions (i) with any Designated Person,
(ii) in any Sanctioned Country or (iii) otherwise in violation of Sanctions.

 

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(iii) Each Borrower and its Subsidiaries, in each case that is subject to the
Patriot Act, is in compliance in all material respects with the provisions of
the Patriot Act that are applicable to it.

Section 6.2 Survival of Representations and Warranties, Etc. All representations
and warranties set forth in this Article VI and all representations and
warranties contained in any certificate, or any of the Loan Documents
(including, but not limited to, any such representation or warranty made in or
in connection with any amendment thereto) shall constitute representations and
warranties made under this Agreement. All representations and warranties made
under this Agreement shall be made or deemed to be made at and as of the Closing
Date (except those that are expressly made as of a specific date), shall survive
the Closing Date and shall not be waived by the execution and delivery of this
Agreement, any investigation made by or on behalf of the Lenders or any
borrowing hereunder.

ARTICLE VII

FINANCIAL INFORMATION AND NOTICES

Until all the Obligations have been paid and satisfied in full and the Revolving
Credit Commitments terminated, unless consent has been obtained in the manner
set forth in Section 13.10 hereof, the Company will furnish or cause to be
furnished to the Administrative Agent at the Administrative Agent’s Office at
the address set forth in Section 13.1 and to the Lenders at their respective
addresses as set forth in the Register and/or provided to the Administrative
Agent from time to time, or such other office as may be designated by the
Administrative Agent and Lenders from time to time:

Section 7.1 Financial Statements and Projections.

(a) Quarterly Financial Statements. As soon as practicable, and in any event
within sixty (60) days after the end of each of the first three (3) fiscal
quarters of each Fiscal Year, an unaudited Consolidated balance sheet of the
Borrowers and their Subsidiaries as of the close of such fiscal quarter and an
unaudited Consolidated statement of income for the fiscal quarter then ended,
together with statements of retained earnings and cash flows for the portion of
the Fiscal Year then ended, including the notes thereto, all in reasonable
detail setting forth in comparative form the corresponding figures as of the end
of and for the corresponding period in the preceding Fiscal Year and prepared by
the Company in accordance with GAAP and, if applicable, containing disclosure of
the effect on the financial position or results of operations of any change in
the application of accounting principles and practices during the period, and
certified by the chief financial officer of the Company to present fairly in all
material respects the financial condition of the Borrowers and their
Subsidiaries on a Consolidated basis as of their respective dates and the
results of operations of the Borrowers and their Subsidiaries for the respective
periods then ended, subject to normal year end adjustments.

(b) Annual Financial Statements. As soon as practicable, and in any event within
ninety (90) days after the end of each Fiscal Year, an audited Consolidated
balance sheet

 

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of the Borrowers and their Subsidiaries as of the close of such Fiscal Year and
audited Consolidated statements of income, retained earnings and cash flows for
the Fiscal Year then ended, including the notes thereto, all in reasonable
detail setting forth in comparative form the corresponding figures as of the end
of and for the preceding Fiscal Year and prepared in accordance with GAAP and,
if applicable, containing disclosure of the effect on the financial position or
results of operations of any change in the application of accounting principles
and practices during the year, to be accompanied by a report thereon by an
independent certified public accounting firm, reasonably acceptable to the
Administrative Agent, that is not qualified with respect to scope limitations
imposed by any Borrower or any of its Subsidiaries or with respect to accounting
principles followed by any Borrower or any of its Subsidiaries not in accordance
with GAAP.

(c) Annual Business Plan and Financial Projections. As soon as practicable, and
in any event prior to the end of the first fiscal quarter of each Fiscal Year, a
business plan of the Borrowers and their Subsidiaries for such Fiscal Year, such
plan to be prepared in accordance with GAAP and to include, on a quarterly
basis, the following: a quarterly operating and capital budget, a projected
income statement, statement of cash flows and balance sheet and a report
containing management’s discussion and analysis of such projections, accompanied
by a certificate from the chief financial officer of the Company to the effect
that, to the best of such officer’s knowledge, such projections are good faith
estimates (utilizing reasonable assumptions) of the financial condition and
operations of the Borrowers and their Subsidiaries for such four (4) quarter
period.

Section 7.2 Officer’s Compliance Certificate. At each time financial statements
are delivered pursuant to Sections 7.1(a) or (b) and at such other times as the
Administrative Agent shall reasonably request, a certificate of the chief
financial officer or the treasurer of the Company in the form of Exhibit F
attached hereto (an “Officer’s Compliance Certificate”).

Section 7.3 Accountants’ Certificate. At each time financial statements are
delivered pursuant to Section 7.1(b), a certificate of the independent public
accountants certifying such financial statements addressed to the Administrative
Agent for the benefit of the Lenders stating that in making the examination
necessary for the certification of such financial statements, they obtained no
knowledge of any Default or Event of Default or, if such is not the case,
specifying such Default or Event of Default and its nature and period of
existence.

Section 7.4 Other Reports. Such information regarding the operations, business
affairs and financial condition of any Borrower or any of its Subsidiaries as
the Administrative Agent or any Lender may reasonably request.

Section 7.5 Notice of Litigation and Other Matters. Prompt (but in no event
later than ten (10) days after an officer of any Borrower obtains knowledge
thereof) telephonic and written notice of:

(a) the commencement of all proceedings and investigations by or before any
Governmental Authority and all actions and proceedings in any court or before
any arbitrator against or involving any Borrower or any Subsidiary thereof or
any of their respective properties, assets or businesses which involves an
amount in excess of $15,000,000 individually or $30,000,000 in the aggregate;

 

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(b) any notice of any violation received by any Borrower or any Subsidiary
thereof from any Governmental Authority including, without limitation, any
notice of violation of Environmental Laws involving an amount in excess of
$15,000,000 individually or in the aggregate;

(c) any labor controversy that has resulted in, or threatens to result in, a
strike or other work action against any Borrower or any Subsidiary thereof at
any material business location of any Borrower or any Subsidiary;

(d) any attachment, judgment, lien, levy or order exceeding $5,000,000 that may
be assessed against any Borrower or any Subsidiary thereof;

(e) (i) any Default or Event of Default, (ii) the occurrence or existence of any
event or circumstance that foreseeably will become a Default or Event of Default
or (iii) any event which constitutes or which with the passage of time or giving
of notice or both would constitute a default or event of default under any
Material Contract to which any Borrower or any of its Subsidiaries is a party or
by which any Borrower or any Subsidiary thereof or any of their respective
properties may be bound if such default or event of default shall have a
Material Adverse Effect on any Borrower or any Subsidiary;

(f) (i) any unfavorable determination letter from the Internal Revenue Service
regarding the qualification of an Employee Benefit Plan under Section 401(a) of
the Code (along with a copy thereof), (ii) all notices received by any Borrower
or any ERISA Affiliate of the PBGC’s intent to terminate any Pension Plan or to
have a trustee appointed to administer any Pension Plan, (iii) all notices
received by any Borrower or any ERISA Affiliate from a Multiemployer Plan
sponsor concerning the imposition or amount of withdrawal liability pursuant to
Section 4202 of ERISA and (iv) any Borrower obtaining knowledge or reason to
know that any Borrower or any ERISA Affiliate has filed or intends to file a
notice of intent to terminate any Pension Plan under a distress termination
within the meaning of Section 4041(c) of ERISA; and

(g) any event which makes any of the representations set forth in Section 6.1
inaccurate in any material respect.

Section 7.6 Accuracy of Information. All written information, reports,
statements and other papers and data furnished by or on behalf of any Borrower
to the Administrative Agent or any Lender whether pursuant to this Article VII
or any other provision of this Agreement shall be, at the time the same is so
furnished, in compliance with the representations and warranties set forth in
Section 6.1(x).

 

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ARTICLE VIII

AFFIRMATIVE COVENANTS

Until all of the Obligations have been paid and satisfied in full and the
Revolving Credit Commitments terminated, unless consent has been obtained in the
manner provided for in Section 13.10, each Borrower will, and will cause each of
its Subsidiaries to:

Section 8.1 Preservation of Corporate Existence and Related Matters. Except as
permitted by Section 10.4, preserve and maintain its separate corporate
existence and all rights, franchises, licenses and privileges necessary to the
conduct of its business, and qualify and remain qualified as a foreign
corporation and authorized to do business in each jurisdiction where the nature
and scope of its activities require it to so qualify under Applicable Law.

Section 8.2 Maintenance of Property. Protect and preserve all properties useful
in and material to its business, including copyrights, patents, trade names,
service marks and trademarks; maintain in good working order and condition all
buildings, equipment and other tangible real and personal property; and from
time to time make or cause to be made all renewals, replacements and additions
to such property necessary for the conduct of its business, so that the business
carried on in connection therewith may be conducted in a commercially reasonable
matter.

Section 8.3 Insurance. Maintain insurance with financially sound and reputable
insurance companies against such risks and in such amounts as are customarily
maintained by similar businesses and as may be required by Applicable Law, and
on the Closing Date and from time to time thereafter deliver to the
Administrative Agent upon its request a detailed list of the insurance then in
effect, stating the names of the insurance companies, the amounts and rates of
the insurance, the dates of the expiration thereof and the properties and risks
covered thereby. As of the Closing Date, the Borrowers maintain the insurance
described on Schedule 8.3.

Section 8.4 Accounting Methods and Financial Records. Maintain a system of
accounting, and keep such books, records and accounts (which shall be true and
complete in all material respects) as may be required or as may be necessary to
permit the preparation of financial statements in accordance with GAAP and in
compliance with the regulations of any Governmental Authority having
jurisdiction over it or any of its properties.

Section 8.5 Payment and Performance of Obligations. Pay and perform all
Obligations under this Agreement and the other Loan Documents, and pay or
perform (a) all taxes, assessments and other governmental charges that may be
levied or assessed upon it or any of its property, and (b) all other
indebtedness, obligations and liabilities in accordance with customary trade
practices; provided, that any Borrower or such Subsidiary may contest any item
described in clauses (a) or (b) of this Section 8.5 in good faith so long as
adequate reserves are maintained with respect thereto in accordance with GAAP.

Section 8.6 Compliance With Laws and Approvals. Observe and remain in compliance
in all material respects with all Applicable Laws and maintain in full force and
effect all Governmental Approvals, in each case applicable to the conduct of its
business.

 

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Section 8.7 Environmental Laws. In addition to and without limiting the
generality of Section 8.6, (a) comply with, and ensure such compliance in all
material respects by all tenants and subtenants with all applicable
Environmental Laws and obtain and comply with and maintain, and ensure that all
tenants and subtenants, if any, obtain and comply with and maintain, any and all
licenses, approvals, notifications, registrations or permits required by
applicable Environmental Laws, (b) conduct and complete all investigations,
studies, sampling and testing, and all remedial, removal and other actions
required under Environmental Laws, and promptly comply with all lawful orders
and directives of any Governmental Authority regarding Environmental Laws,
unless such lawful orders and directives are being contested in good faith and
by appropriate proceedings and for which adequate reserves are maintained to the
extent required by GAAP, and (c) defend, indemnify and hold harmless each
Indemnitee from and against any claims, demands, penalties, fines, liabilities,
settlements, damages, costs and expenses of whatever kind or nature known or
unknown, contingent or otherwise, arising out of, or in any way relating to the
presence of Hazardous Materials, or the violation of, noncompliance with or
liability under any Environmental Laws applicable to the operations of any
Borrower or any such Subsidiary, or any orders, requirements or demands of
Governmental Authorities related thereto, including, without limitation,
reasonable attorney’s and consultant’s fees, investigation and laboratory fees,
response costs, court costs and litigation expenses, except to the extent that
any of the foregoing directly result from the gross negligence or willful
misconduct of the party seeking indemnification therefor as determined by a
court of competent jurisdiction by final and nonappealable judgment.

Section 8.8 Compliance with ERISA. In addition to and without limiting the
generality of Section 8.6, (a) except where the failure to so comply could not,
individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect, (i) comply with all material applicable provisions of ERISA, the
Code and the regulations and published interpretations thereunder with respect
to all Employee Benefit Plans, (ii) not take any action or fail to take action
the result of which could be a liability to the PBGC or to a Multiemployer Plan,
(iii) not participate in any prohibited transaction that could result in any
civil penalty under ERISA or tax under the Code and (iv) operate each Employee
Benefit Plan in such a manner that will not incur any tax liability under
Section 4980B of the Code or any liability to any qualified beneficiary as
defined in Section 4980B of the Code and (b) furnish to the Administrative Agent
upon the Administrative Agent’s request such additional information about any
Employee Benefit Plan as may be reasonably requested by the Administrative
Agent.

Section 8.9 Compliance With Agreements. Comply in all material respects with
each term, condition and provision of all material leases, agreements and other
instruments entered into in the conduct of its business including, without
limitation, any Material Contract.

Section 8.10 Visits and Inspections. Permit representatives of the
Administrative Agent or any Lender, from time to time, during normal business
hours, to visit and inspect its properties; inspect, audit and make extracts
from its books, records and files, including, but not limited to, management
letters prepared by independent accountants; and discuss with its principal
officers, and its independent accountants, its business, assets, liabilities,
financial condition, results of operations and business prospects.

 

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Section 8.11 Additional Subsidiaries. Notify the Administrative Agent within ten
(10) days of the creation or acquisition of any Subsidiary of any Borrower,
which is created or acquired after the Closing Date and which engages in any
business operations or owns assets with a fair market value in excess of
$5,000,000, and promptly thereafter (and in any event within thirty (30) days
following the creation or acquisition of such Subsidiary) cause to be executed
and delivered to the Administrative Agent (a) a duly executed Joinder Agreement
and (b) favorable legal opinions addressed to the Administrative Agent and
Lenders in form and substance satisfactory thereto with respect to such Joinder
Agreement and such other documents and closing certificates as may be requested
by the Administrative Agent, including all documentation and other information
requested by the Administrative Agent that is required to satisfy applicable
“know your customer” and anti-money laundering rules and regulations, including
without limitation the Patriot Act.

Section 8.12 Use of Proceeds. Use the proceeds of the Revolving Credit Loans
(i) to refinance the Existing Credit Agreement and (ii) for working capital and
general corporate purposes of the Borrowers and their Subsidiaries, including
capital expenditures in the ordinary course of business, and permitted
acquisitions.

Section 8.13 Additional Borrowers. Notwithstanding the provisions of
Section 8.11 to the contrary, cause any Subsidiary which becomes an obligor or
guarantor with respect to the Debt under the Senior Notes to become a Borrower
under this Agreement and to deliver to the Administrative Agent the items
described in clauses (a) and (b) of Section 8.11.

Section 8.14 Anti-Corruption Laws; OFAC.

(a) Each Borrower will, and will cause each of its Subsidiaries to, comply with
laws applicable to transactions of or with any Designated Person or in any
Sanctioned Country. Each Borrower will, and will cause each of its Subsidiaries
to, terminate, after obtaining knowledge thereof no later than required by
applicable law, any funding financing or facilitating by such Borrower or its
Subsidiaries of any activities, business or transaction of or with any
Designated Person or in any Sanctioned Country or otherwise in violation of
Sanctions, as such Sanctions Lists or Sanctions are in effect from time to time.

(b) No part of the proceeds of any Loans or Letters of Credit will be used
directly or, to the knowledge of the Borrowers, indirectly (i) for any payments
to any governmental official or employee, political party, official of a
political party, candidate for political office, or anyone else acting in an
official capacity, in order to obtain, retain or direct business or obtain any
improper advantage, in violation of the Anti-Corruption Laws or (ii) (A) to
fund, or to lend, contribute or otherwise make available such proceeds to any
other Person to fund, any activities or business of or with any Person, or in
any country or territory, that, at the time of such funding or issuance, is, or
whose government is, the subject of Sanctions, or (B) in any other manner that
would result in a violation of Sanctions by any Person party hereto.

Section 8.15 Further Assurances. Make, execute and deliver all such additional
and further acts, things, deeds and instruments as the Administrative Agent or
the Required Lenders (through the Administrative Agent) may reasonably require
to document and consummate the transactions contemplated hereby and to vest
completely in and insure the Administrative Agent and the Lenders their
respective rights under this Agreement, the Notes, the Letters of Credit and the
other Loan Documents.

 

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ARTICLE IX

FINANCIAL COVENANTS

Until all of the Obligations have been paid and satisfied in full and the
Revolving Credit Commitments terminated, unless consent has been obtained in the
manner set forth in Section 13.10 hereof, the Borrowers and their Subsidiaries
on a Consolidated basis will not:

Section 9.1 Leverage Ratio. As of any fiscal quarter end, permit the ratio of
(a) Adjusted Debt on such date to (b) EBITDAR for the period of four
(4) consecutive fiscal quarters ending on or immediately prior to such date (the
“Leverage Ratio”) to be greater than 4.0 to 1.0.

Section 9.2 Fixed Charge Coverage Ratio. As of the end of any fiscal quarter,
permit the Fixed Charge Coverage Ratio to be less than 1.75 to 1.0.

ARTICLE X

NEGATIVE COVENANTS

Until all of the Obligations have been paid and satisfied in full and the
Revolving Credit Commitments terminated, unless consent has been obtained in the
manner set forth in Section 13.10, each of the Borrowers has not and will not
and will not permit any of its Subsidiaries to:

Section 10.1 Limitations on Debt. Create, incur, assume or suffer to exist any
Debt or Additional Debt except:

(a) the Obligations (excluding Hedging Obligations permitted pursuant to
Section 10.1(b));

(b) Debt incurred in connection with a Hedging Agreement which is
non-speculative and entered into in the ordinary course of a Borrower’s
business;

(c) Debt existing on the Closing Date and not otherwise permitted under this
Section 10.1, as set forth on Schedule 6.1(t), and the renewal, refinancing,
extension and replacement thereof (but not the increase in the aggregate
principal amount); provided that with respect to each series of the Senior
Notes, (i) the respective aggregate principal amount of such series shall not be
increased, (ii) the maturity date of any such renewal, refinancing, extension or
replacement of such series shall not be prior to or shorter than the existing
maturity date of such series and (iii) any such renewal, refinancing, extension
or replacement of such series shall be on terms no more restrictive to the
Borrowers and their Subsidiaries than the terms of such series.

(d) Debt of the Borrowers and their Subsidiaries incurred in connection with
Capitalized Leases in an aggregate amount not to exceed $150,000,000 on any date
of determination;

 

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(e) purchase money Debt of the Borrowers and their Subsidiaries in an aggregate
amount not to exceed $75,000,000 on any date of determination;

(f) Guaranty Obligations in favor of the Administrative Agent for the benefit of
the Administrative Agent and the Lenders;

(g) Guaranty Obligations with respect to Debt permitted pursuant to subsections
(a) through (e) of this Section 10.1;

(h) Guaranty Obligations of the Company consisting of guarantees of operating
leases for store locations entered into by any other Borrower in the ordinary
course of its business;

(i) Debt with respect to trade letter of credit facilities in an aggregate
amount not to exceed $150,000,000 on any date of determination (which amount
shall be inclusive of the amount set forth on Item 1 of Schedule 6.1(t);

(j) Guaranty Obligations with respect to Debt permitted pursuant to subsection
(i) of this Section 10.1;

(k) Guaranty Obligations arising from agreements entered into by any of the
Borrowers in the ordinary course of business providing for indemnification or
similar obligations in the event of the non-performance by the respective
Borrower of any obligation under any such agreement;

(l) additional unsecured Debt of the Borrowers (other than the Company) and
their Subsidiaries in an aggregate amount not to exceed $150,000,000 on any date
of determination; and

(m) additional unsecured Debt of the Company so long as, after giving effect to
such additional Debt, the Borrowers are in pro forma compliance with the
covenants contained in Article IX (such pro forma compliance to be measured
using the financial statements most recently delivered pursuant to
Section 7.1(a) and (b) (it being agreed that no prior notices or deliveries to
any party will be required as a condition to any such payment)), calculated as
if such Debt existed on the immediately preceding measuring date.

provided, that no agreement or instrument with respect to Debt permitted to be
incurred by this Section 10.1 shall restrict, limit or otherwise encumber (by
covenant or otherwise) the ability of any Subsidiary of any Borrower to make any
payment to such Borrower or any of its Subsidiaries (in the form of dividends,
intercompany advances or otherwise) for the purpose of enabling such Borrower to
pay the Obligations.

Section 10.2 Limitations on Liens. Create, incur, assume or suffer to exist, any
Lien on or with respect to any of its assets or properties (including, without
limitation, shares of capital stock or other ownership interests), real or
personal, whether now owned or hereafter acquired, except:

 

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(a) Liens for taxes, assessments and other governmental charges or levies
(excluding any Lien imposed pursuant to any of the provisions of ERISA or
Environmental Laws) not yet due or as to which the period of grace (not to
exceed thirty (30) days), if any, related thereto has not expired or which are
being contested in good faith and by appropriate proceedings and for which
adequate reserves are maintained to the extent required by GAAP;

(b) the claims of materialmen, contractors, mechanics, carriers, warehousemen,
processors or landlords for labor, materials, supplies or rentals incurred in
the ordinary course of business, (i) which are not overdue for a period of more
than thirty (30) days or (ii) which are being contested in good faith and by
appropriate proceedings;

(c) Liens consisting of deposits or pledges made in the ordinary course of
business in connection with, or to secure payment of, obligations under workers’
compensation, unemployment insurance or similar legislation;

(d) Liens constituting encumbrances in the nature of zoning restrictions,
easements and rights or restrictions of record on the use of real property,
which in the aggregate are not substantial in amount and which do not, in any
case, detract from the value of such property or impair the use thereof in the
ordinary conduct of business;

(e) Liens of the Administrative Agent for the benefit of the Administrative
Agent and the Lenders (including Liens of the Administrative Agent in cash
collateral for the benefit of any Issuing Lender or the Swingline Lender to
secure obligations of Defaulting Lenders);

(f) Liens not otherwise permitted by this Section 10.2 and in existence on the
Closing Date and described on Schedule 10.2; and

(g) Liens securing Debt permitted under Sections 10.1(d) and (e); provided that
(i) such Liens shall be created substantially simultaneously with the
acquisition or lease of the related asset, (ii) such Liens do not at any time
encumber any property other than the property financed by such Debt, (iii) the
amount of Debt secured thereby is not increased and (iv) the principal amount of
Debt secured by any such Lien shall at no time exceed one hundred percent
(100%) of the original purchase price or lease payment amount of such property
at the time it was acquired.

Section 10.3 Limitations on Loans, Advances, Investments and Acquisitions.
Purchase, own, invest in or otherwise acquire, directly or indirectly, any
capital stock, interests in any partnership or joint venture (including, without
limitation, the creation or capitalization of any Subsidiary), evidence of Debt
or other obligation or security, substantially all or a portion of the business
or assets of any other Person or any other investment or interest whatsoever in
any other Person, or make or permit to exist, directly or indirectly, any loans,
advances or extensions of credit to, or any investment in cash or by delivery of
property in, any Person except:

(a) investments in (i) Subsidiaries existing on the Closing Date, (ii) in
Subsidiaries formed or acquired after the Closing Date so long as the Borrowers
and their Subsidiaries comply with the applicable provisions of Section 8.11 and
the other terms and provisions of this Agreement and (iii) the other loans,
advances and investments described on Schedule 10.3 existing on the Closing
Date;

 

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(b) investments in cash or cash equivalents made in accordance with the
Company’s written investment policy as modified and approved by the Company’s
Board of Directors from time to time;

(c) investments in the form of the acquisition of all or substantially all of
the business or a line of business (whether by the acquisition of capital stock,
assets or any combination thereof) of any other Person, if (i) no Default or
Event of Default then exists or would be created thereby, (ii) the Borrowers
have delivered to the Administrative Agent a certificate of a Responsible
Officer (on behalf of the Borrowers) demonstrating pro forma compliance with the
covenants contained in Article IX both before and after giving effect to such
acquisition, except that no certificate shall be required to be delivered for
any acquisition involving aggregate consideration (including cash and non-cash
consideration) of less than $20,000,000;

(d) Hedging Agreements permitted pursuant to Section 10.1;

(e) purchases of assets in the ordinary course of business;

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

(g) other investments not exceeding $50,000,000 in the aggregate in any Fiscal
Year of the Borrowers.

Section 10.4 Limitations on Mergers and Liquidation. Merge, consolidate or enter
into any similar combination with any other Person or liquidate, wind-up or
dissolve itself (or suffer any liquidation or dissolution) except:

(a) any Subsidiary of any Borrower may merge with the Company, such Borrower or
any other Subsidiary of such Borrower; provided that in any merger involving the
Company or a Borrower, the Company or such Borrower shall be the surviving
entity;

(b) any Wholly Owned Subsidiary of any Borrower may merge into the Person such
Wholly Owned Subsidiary was formed to acquire in connection with an acquisition
permitted by Section 10.3(c); and

(c) any Wholly Owned Subsidiary of any Borrower may wind-up into such Borrower
or any other Wholly Owned Subsidiary of such Borrower.

Section 10.5 Limitations on Sale of Assets. Convey, sell, lease, assign,
transfer or otherwise dispose of any of its property, business or assets
(including, without limitation, the sale of any receivables and leasehold
interests and any sale-leaseback or similar transaction), whether now owned or
hereafter acquired except:

 

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

(b) the sale of obsolete assets no longer used or usable in the business of any
Borrower or any of its Subsidiaries;

(c) the transfer of assets to any Borrower or any Wholly Owned Subsidiary of any
Borrower pursuant to Section 10.4(c);

(d) the sale or discount without recourse of accounts receivable arising in the
ordinary course of business in connection with the compromise or collection
thereof;

(e) the disposition of any Hedging Agreement;

(f) sale and leaseback transactions with respect to (i) retail store locations,
distribution centers and other fixed assets acquired or constructed by the
Borrowers in the ordinary course of the Borrowers’ business on or before the
date of this Agreement, provided that the aggregate amount of such sale and
lease back transactions do not exceed $50,000,000 during the term of this
Agreement and (ii) retail store locations, distribution centers and other fixed
assets acquired or constructed by the Borrowers after the Closing Date in the
ordinary course of the Borrowers’ business; and

(g) any other sale of any asset not otherwise permitted by this Section 10.5;
provided that the aggregate amount of all sales permitted by this paragraph
(g) does not exceed five percent (5%) of such Borrower’s Net Worth in any Fiscal
Year.

Section 10.6 Limitations on Dividends and Distributions. Declare or pay any
dividends upon any of its capital stock or any other ownership interests;
purchase, redeem, retire or otherwise acquire, directly or indirectly, any
shares of its capital stock or other ownership interests, or make any
distribution of cash, property or assets among the holders of shares of its
capital stock or other ownership interests, or make any change in its capital
structure; provided that:

(a) any Borrower or any Subsidiary may pay dividends in shares of its own
capital stock;

(b) any Subsidiary may pay cash dividends to a Borrower;

(c) any Borrower or any Subsidiary may pay any other dividends or distributions
not otherwise permitted by this Section 10.6; provided that (i) the Borrowers
and their Subsidiaries are in pro forma compliance with the covenants contained
in Article IX (such pro forma compliance to be measured using the financial
statements most recently delivered pursuant to Section 7.1(a) and (b) (it being
agreed that no prior notices or deliveries to any party will be required as a
condition to any such payment)) and (ii) no Default or Event of Default shall
have occurred and be continuing both before and after giving effect to the
payment such dividends and distributions under this paragraph (c); and

(d) the Company may purchase, redeem, retire or otherwise acquire, directly or
indirectly, shares of its capital stock (any such purchase, redemption,
retirement or acquisition

 

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under this paragraph (d), a “Restricted Payment”); provided that, with respect
to any Restricted Payment, (i) the Borrowers and their Subsidiaries are in pro
forma compliance with the covenants contained in Article IX (such pro forma
compliance to be measured using the financial statements most recently delivered
pursuant to Section 7.1(a) and (b) (it being agreed that no prior notices or
deliveries to any party will be required as a condition to any such Restricted
Payment)) and (ii) no Default or Event of Default shall have occurred and be
continuing both before and after giving effect to such Restricted Payment.

Section 10.7 Limitations on Exchange and Issuance of Capital Stock. Issue, sell
or otherwise dispose of any class or series of capital stock that, by its terms
or by the terms of any security into which it is convertible or exchangeable,
is, or upon the happening of an event or passage of time would be,
(a) convertible or exchangeable into Debt or (b) required to be redeemed or
repurchased, including at the option of the holder, in whole or in part, or has,
or upon the happening of an event or passage of time would have, a redemption or
similar payment due.

Section 10.8 Transactions with Affiliates. Except for transactions permitted by
Sections 10.3, 10.6, 10.7, and loans and advances not exceeding $10,000,000 in
the aggregate at any one time outstanding to officers and employees of Borrowers
for the purchase of a residence in connection with the relocation of such
officers and employees and those transactions existing on the Closing Date and
identified on Schedule 10.8 directly or indirectly (a) make any loan or advance
to, or purchase or assume any note or other obligation to or from, any of its
officers, directors, shareholders or other Affiliates, or to or from any member
of the immediate family of any of its officers, directors, shareholders or other
Affiliates, or subcontract any operations to any of its Affiliates or (b) enter
into, or be a party to, any other transaction not described in clause (a) above
with any of its Affiliates, except pursuant to the reasonable requirements of
its business and upon fair and reasonable terms that are fully disclosed to and
approved in writing by the Required Lenders prior to the consummation thereof
and are no less favorable to it than it would obtain in a comparable arm’s
length transaction with a Person not its Affiliate.

Section 10.9 Certain Accounting Changes; Organizational Documents. (a) Change
their Fiscal Year end, or, except as permitted pursuant to Section 13.8, make
any change in their accounting treatment and reporting practices except as
required or permitted by GAAP or (b) amend, modify or change its articles of
incorporation (or corporate charter or other similar organizational documents)
or amend, modify or change its bylaws (or other similar documents) in any manner
adverse in any respect to the rights or interests of the Lenders.

Section 10.10 Amendments; Payments and Prepayments of Debt. Amend or modify (or
permit the modification or amendment of) any of the terms or provisions of any
Subordinated Debt, or cancel or forgive, make (or give any notice with respect
thereto) any voluntary, optional or other non-scheduled payment, prepayment,
redemption, acquisition for value (including without limitation, by way of
depositing money or securities with the trustee with respect thereto before due
for the purpose of paying when due) any Subordinated Debt.

 

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Section 10.11 Restrictive Agreements.

(a) Enter into any Debt which contains (i) any covenants more restrictive than
the provisions of Articles VIII, IX and X hereof, or (ii) any negative pledge or
other restriction, limitation or otherwise encumbers its ability to incur Liens
on or with respect to any of its assets or properties other than the assets or
properties securing such Debt; except, with respect to this clause (ii), the
Senior Notes.

(b) Enter into or permit to exist any agreement which impairs or limits the
ability of any Subsidiary of a Borrower to pay dividends to such Borrower.

Section 10.12 Nature of Business. Substantively alter the character or conduct
of the business conducted by any Borrower and its Subsidiaries as of the Closing
Date.

ARTICLE XI

DEFAULT AND REMEDIES

Section 11.1 Events of Default. Each of the following shall constitute an Event
of Default, whatever the reason for such event and whether it shall be voluntary
or involuntary or be effected by operation of law or pursuant to any judgment or
order of any court or any order, rule or regulation of any Governmental
Authority or otherwise:

(a) Default in Payment of Principal of Loans and Reimbursement Obligations. The
Borrowers shall default in any payment of principal of any Loan, Note or
Reimbursement Obligation when and as due (whether at maturity, by reason of
acceleration or otherwise).

(b) Other Payment Default. The Borrowers shall default in the payment when and
as due (whether at maturity, by reason of acceleration or otherwise) of interest
on any Loan, Note or Reimbursement Obligation or (except as provided in clause
(a) above) the payment of any other Obligation (other than any Obligation under
any Hedging Agreement or Cash Management Agreement) for more than three Business
Days after the same becomes due and payable.

(c) Misrepresentation. Any representation or warranty made or deemed to be made
by the Borrowers or any of their Subsidiaries under this Agreement, any other
Loan Document or any amendment hereto or thereto, shall at any time prove to
have been incorrect or misleading in any material respect when made or deemed
made.

(d) Default in Performance of Certain Covenants. The Borrowers shall default in
the performance or observance of any covenant or agreement contained in
Sections 7.1, 7.2, or 7.5(e)(i) or Articles IX or X of this Agreement.

(e) Default in Performance of Other Covenants and Conditions. The Borrowers or
any of their Subsidiaries shall default in the performance or observance of any
term, covenant, condition or agreement contained in this Agreement (other than
as specifically provided for otherwise in this Section 11.1) or any other Loan
Document (other than as specifically provided for otherwise in this
Section 11.1) and such default shall continue for a period of thirty (30) days
after written notice thereof has been given to the Company by the Administrative
Agent.

 

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(f) Hedging Agreement; Cash Management Agreements. The Borrowers shall default
in the performance or observance of any terms, covenant, condition or agreement
(after giving effect to any applicable grace or cure period) under any Hedging
Agreement representing an aggregate liability to the Borrowers in excess of
$5,000,000 and such default causes the termination of such Hedging Agreement or
permits any counterparty to such Hedging Agreement to terminate any such Hedging
Agreement; or the Borrowers shall default in the performance or observance of
any terms, covenant, condition or agreement (after giving effect to any
applicable grace or cure period) under any Cash Management Agreement
representing an aggregate liability to the Borrowers in excess of $5,000,000.

(g) Debt Cross-Default. The Borrowers or any of their Subsidiaries shall
(i) default in the payment of any Debt (other than the Loans or any
Reimbursement Obligation) the aggregate outstanding amount of which Debt is in
excess of the lesser of (A) $25,000,000 or (B) the lowest cross default
threshold amount set forth in any of the Senior Notes, in each case beyond the
period of grace if any, provided in the instrument or agreement under which such
Debt was created, or (ii) default in the observance or performance of any other
agreement or condition relating to any Debt (other than the Loans or any
Reimbursement Obligation) the aggregate outstanding amount of which Debt is in
excess of the lesser of (A) $25,000,000 or (B) the lowest cross default
threshold amount set forth in any of the Senior Notes or contained in any
instrument or agreement evidencing, securing or relating thereto or any other
event shall occur or condition exist, the effect of which default or other event
or condition is to cause, or to permit the holder or holders of such Debt (or a
trustee or agent on behalf of such holder or holders) to cause, with the giving
of notice if required, any such Debt to become due prior to its stated maturity
(any applicable grace period having expired).

(h) Other Cross-Defaults. The occurrence of any default or event of default
under any of the instruments and documents executed in connection with the
Senior Notes.

(i) Change in Control. Any person or group of persons (within the meaning of
Section 13(d) of the Securities Exchange Act of 1934, as amended) other than
members of the Belk family (and any trusts of which such family members are
beneficiaries and any other Persons of which such family members is the
beneficial equityholder) shall obtain ownership or control in one or more series
of transactions of more than fifty-one percent (51%) of the common stock or
fifty-one percent (51%) of the voting power of the Company entitled to vote in
the election of members of the board of directors of the Company or there shall
have occurred under any indenture or other instrument evidencing any Debt in
excess of $1,000,000 any “change in control” (as defined in such indenture or
other evidence of Debt) obligating any Borrower to repurchase, redeem or repay
all or any part of the Debt or capital stock provided for therein (any such
event, a “Change in Control”).

(j) Voluntary Bankruptcy Proceeding. Any Borrower or any Subsidiary thereof
shall (i) commence a voluntary case under any Debtor Relief Law (as now or
hereafter in effect), (ii) file a petition seeking to take advantage of any
Debtor Relief Law, (iii) consent to or fail to contest in a timely and
appropriate manner any petition filed against it in an involuntary

 

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case under any Debtor Relief Law, (iv) apply for or consent to, or fail to
contest in a timely and appropriate manner, the appointment of, or the taking of
possession by, a receiver, custodian, trustee, or liquidator of itself or of a
substantial part of its property, domestic or foreign, (v) admit in writing its
inability to pay, its debts as they become due, (vi) make a general assignment
for the benefit of creditors, or (vii) take any corporate action for the purpose
of authorizing any of the foregoing.

(k) Involuntary Bankruptcy Proceeding. A case or other proceeding shall be
commenced against any Borrower or any Subsidiary thereof in any court of
competent jurisdiction seeking (i) relief under any Debtor Relief Law (as now or
hereafter in effect), or (ii) the appointment of a trustee, receiver, custodian,
liquidator or the like for any Borrower or any Subsidiary thereof or for all or
any substantial part of their respective assets, domestic or foreign, and such
case or proceeding shall continue without dismissal or stay for a period of
ninety (90) consecutive days, or an order granting the relief requested in such
case or proceeding (including, but not limited to, an order for relief under any
Debtor Relief Law) shall be entered.

(l) Failure of Agreements. Any provision of this Agreement or any provision of
any other Loan Document shall for any reason cease to be valid and binding on
any Borrower or Subsidiary party thereto or any such Person shall so state in
writing, other than in accordance with the express terms hereof or thereof.

(m) ERISA Events. The occurrence of any of the following events: (i) any
Borrower or any ERISA Affiliate fails to make full payment when due of all
amounts which, under the provisions of any Pension Plan or Sections 412 or 430
of the Code, any Borrower or any ERISA Affiliate is required to pay as
contributions thereto and are in excess of $25,000,000, (ii) a Termination Event
or (iii) any Borrower or any ERISA Affiliate as employers under one or more
Multiemployer Plans makes a complete or partial withdrawal from any such
Multiemployer Plan and the plan sponsor of such Multiemployer Plans notifies
such withdrawing employer that such employer has incurred a withdrawal liability
requiring payments in an amount exceeding $5,000,000.

(n) Judgment. A judgment or order for the payment of money which causes the
aggregate amount of all such judgments to exceed $10,000,000 in excess of
applicable insurance coverage as to which the applicable insurers do not deny
coverage in any Fiscal Year shall be entered against any Borrower or any of its
Subsidiaries by any court and such judgment or order shall continue without
discharge or stay for a period of thirty (30) days.

(o) Environmental. Any one or more Environmental Claims shall have been asserted
against any Borrower or any of its Subsidiaries; the Borrowers or any
Subsidiaries would be reasonable likely to incur liability as a result thereof;
and such liability would be reasonably likely, individually or in the aggregate,
to have a Material Adverse Effect.

Section 11.2 Remedies. Upon the occurrence of an Event of Default, with the
consent of the Required Lenders, the Administrative Agent may, or upon the
request of the Required Lenders, the Administrative Agent shall, by notice to
the Company:

 

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(a) Acceleration; Termination of Facilities. Declare the principal of and
interest on the Loans, the Notes and the Reimbursement Obligations at the time
outstanding, and all other amounts owed to the Lenders and to the Administrative
Agent under this Agreement or any of the other Loan Documents (including,
without limitation, all L/C Obligations, whether or not the beneficiaries of the
then outstanding Letters of Credit shall have presented or shall be entitled to
present the documents required thereunder) and all other Obligations (other than
Hedging Obligations and amounts owing under any Cash Management Agreement), to
be forthwith due and payable, whereupon the same shall immediately become due
and payable without presentment, demand, protest or other notice of any kind,
all of which are expressly waived, anything in this Agreement or the other Loan
Documents to the contrary notwithstanding, and terminate the Credit Facility and
any right of the Borrowers to request borrowings or Letters of Credit
thereunder; provided, that upon the occurrence of an Event of Default specified
in Section 11.1(j) or (k), the Credit Facility shall be automatically terminated
and all Obligations (other than Hedging Obligations and amounts owing under any
Cash Management Agreement) shall automatically become due and payable without
presentment, demand, protest or other notice of any kind, all of which are
expressly waived, anything in this Agreement or in any other Loan Document to
the contrary notwithstanding.

(b) Letters of Credit. With respect to all Letters of Credit with respect to
which presentment for honor shall not have occurred at the time of an
acceleration pursuant to Section 11.2(a), the Borrowers shall at such time
deposit in the Cash Collateral Account an amount equal to the aggregate then
undrawn and unexpired amount of such Letters of Credit. Amounts held in the Cash
Collateral Account shall be applied by the Administrative Agent to the payment
of drafts drawn under the Letters of Credit and the unused portion thereof after
all such Letters of Credit shall have expired or shall have been fully drawn
upon, if any, shall be applied to repay the other Obligations on a pro rata
basis. After all such Letters of Credit shall expire or shall have been fully
drawn upon, the Reimbursement Obligation shall have been satisfied with respect
to all Letters of Credit and all other Obligations shall have been paid in full,
the balance, if any, in the Cash Collateral Account shall be returned to the
Company.

(c) Rights of Collection. Exercise on behalf of the Lenders all of its other
rights and remedies under this Agreement, the other Loan Documents and
Applicable Law, in order to satisfy all of the Borrowers’ Obligations.

Section 11.3 Rights and Remedies Cumulative; Non-Waiver; etc. The enumeration of
the rights and remedies of the Administrative Agent and the Lenders set forth in
this Agreement is not intended to be exhaustive and the exercise by the
Administrative Agent and the Lenders of any right or remedy shall not preclude
the exercise of any other rights or remedies, all of which shall be cumulative,
and shall be in addition to any other right or remedy given hereunder or under
the other Loan Documents or that may now or hereafter exist at law or in equity
or by suit or otherwise. No delay or failure to take action on the part of the
Administrative Agent or any Lender in exercising any right, power or privilege
shall operate as a waiver thereof, nor shall any single or partial exercise of
any such right, power or privilege preclude any other or further exercise
thereof or the exercise of any other right, power or privilege or shall be
construed to be a waiver of any Event of Default. No course of dealing between
any Borrower, the Administrative Agent and the Lenders or their respective
agents or employees shall be effective to change, modify or discharge any
provision of this Agreement or any of the other Loan Documents or to constitute
a waiver of any Event of Default.

 

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ARTICLE XII

THE ADMINISTRATIVE AGENT

Section 12.1 Appointment. Each of the Lenders hereby irrevocably designates and
appoints Wells Fargo as Administrative Agent of such Lender under this Agreement
and the other Loan Documents for the term hereof and each such Lender
irrevocably authorizes Wells Fargo as Administrative Agent for such Lender, to
take such action on its behalf under the provisions of this Agreement and the
other Loan Documents and to exercise such powers and perform such duties as are
expressly delegated to the Administrative Agent by the terms of this Agreement
and such other Loan Documents, together with such other powers as are reasonably
incidental thereto. The provisions of this Article are solely for the benefit of
the Administrative Agent, the Lenders and the Issuing Lenders, and the Borrowers
shall not 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. Any reference
to the Administrative Agent in this Article XII shall be deemed to refer to the
Administrative Agent solely in its capacity as Administrative Agent and not in
its capacity as a Lender.

Section 12.2 Delegation of Duties. The Administrative Agent may execute any of
its respective duties under this Agreement and the other Loan Documents by or
through agents or attorneys-in-fact and shall be entitled to advice of counsel
concerning all matters pertaining to such duties. The Administrative Agent shall
not be responsible for the negligence or misconduct of any agents or
attorneys-in-fact selected by the Administrative Agent with reasonable care.

Section 12.3 Exculpatory Provisions.

(a) The Administrative Agent shall not have any duties or obligations except
those expressly set forth herein and in the other Loan Documents, and its duties
hereunder shall be administrative in nature. Without limiting the generality of
the foregoing, the Administrative Agent:

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

(ii) 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

 

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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

(iii) shall not, except as expressly set forth herein and in the other Loan
Documents, have any duty to disclose, and shall not be liable for the failure to
disclose, any information relating to the Company or any of its Affiliates that
is communicated to or obtained by the Person serving as the Administrative Agent
or any of its Affiliates in any capacity.

(b) 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 Section 13.10 and Section 11.2), 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.

(c) 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 or Event of Default,
(iv) the validity, enforceability, effectiveness or genuineness of this
Agreement, any other Loan Document or any other agreement, instrument or
document, or (v) the satisfaction of any condition set forth in Article V or
elsewhere herein, other than to confirm receipt of items expressly required to
be delivered to the Administrative Agent.

Section 12.4 Reliance by the Administrative Agent. The Administrative Agent
shall be entitled to rely upon, and shall not incur any liability for relying
upon, any notice, request, certificate, consent, statement, instrument, document
or other writing (including any electronic message, 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 of a Letter of Credit, that
by its terms must be fulfilled to the satisfaction of a Lender or an Issuing
Lender, the Administrative Agent may presume that such condition is satisfactory
to such Lender or Issuing Lender unless the Administrative Agent shall have
received notice to the contrary from such Lender or Issuing Lender 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 the Borrowers),
independent accountants and other experts selected by it, and shall not be
liable for any action taken or not taken by it in accordance with the advice of
any such counsel, accountants or experts.

 

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Section 12.5 Notice of Default. The Administrative Agent shall not be deemed to
have knowledge or notice of the occurrence of any Default or Event of Default
unless it has received notice from a Lender, Issuing Lender or any Borrower
referring to this Agreement, describing such Default or Event of Default and
stating that such notice is a “notice of default”. In the event that the
Administrative Agent receives such a notice, it shall promptly give notice
thereof to the Lenders. The Administrative Agent shall take such action with
respect to such Default or Event of Default as shall be reasonably directed by
the Required Lenders (or, when expressly required hereby, all the Lenders);
provided that unless and until the Administrative Agent shall have received such
directions, the Administrative Agent may (but shall not be obligated to) take
such action, or refrain from taking such action, with respect to such Default or
Event of Default as it shall deem advisable in the best interests of the
Lenders, except to the extent that other provisions of this Agreement expressly
require that any such action be taken or not be taken only with the consent and
authorization or the request of the Lenders or Required Lenders, as applicable.

Section 12.6 Non-Reliance on the Administrative Agent and Other Lenders. Each
Lender expressly acknowledges that neither the Administrative Agent nor any of
its respective officers, directors, employees, agents, attorneys-in-fact,
Subsidiaries or Affiliates has made any representations or warranties to it and
that no act by the Administrative Agent hereafter taken, including any review of
the affairs of the Borrowers or any of their Subsidiaries, shall be deemed to
constitute any representation or warranty by the Administrative Agent to any
Lender. Each Lender represents to the Administrative Agent that 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 appraisal of and investigation into the business,
operations, property, financial and other condition and creditworthiness of the
Borrowers and their Subsidiaries and made its own decision to make its Loans and
Issue or participate in Letters of Credit hereunder and enter into this
Agreement. Each Lender also represents that it will, independently and without
reliance upon the Administrative Agent 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 analysis, appraisals and decisions in taking or not taking
action under this Agreement and the other Loan Documents, and to make such
investigation as it deems necessary to inform itself as to the business,
operations, property, financial and other condition and creditworthiness of the
Borrowers and their Subsidiaries. Except for notices, reports and other
documents expressly required to be furnished to the Lenders by the
Administrative Agent hereunder or by the other Loan Documents, the
Administrative Agent shall not have any duty or responsibility to provide any
Lender with any credit or other information concerning the business, operations,
property, financial and other condition or creditworthiness of the Borrowers or
any of their Subsidiaries which may come into the possession of the
Administrative Agent or any of its respective officers, directors, employees,
agents, attorneys-in-fact, Subsidiaries or Affiliates.

Section 12.7 Indemnification. To the extent that the Borrowers for any reason
fails to indefeasibly pay any amount required under Section 8.7 or Section 13.2
to be paid by it to the Administrative Agent (or any sub-agent thereof), any
Issuing Lender, the Swingline 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), such Issuing Lender, the Swingline Lender or such Related
Party, as the case may be, such Lender’s pro rata share (determined as of the
time

 

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that the applicable unreimbursed expense or indemnity payment is sought based on
each Lender’s share of the aggregate Extensions of Credit at such time) of such
unpaid amount (including any such unpaid amount in respect of a claim asserted
by such Lender); 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), such
Issuing Lender or such Swingline 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), such Issuing Lender or any such Swingline Lender in
connection with such capacity. The obligations of the Lenders under this
Section 12.8 are subject to the provisions of Section 4.7.

Section 12.8 The Administrative Agent in Its Individual Capacity. The
Administrative Agent and its respective Subsidiaries and Affiliates may make
loans to, accept deposits from and generally engage in any kind of business with
the Borrowers as though the Administrative Agent were not the Administrative
Agent hereunder and without any duty to account therefor to the Lenders. With
respect to any Loans made or renewed by it and any Note issued to it and with
respect to any Letter of Credit Issued by it or participated in by it, the
Administrative Agent shall have the same rights and powers under this Agreement
and the other Loan Documents as any Lender and may exercise the same as though
it were not the Administrative Agent, and the terms “Lender” and “Lenders” shall
include the Administrative Agent in its individual capacity.

Section 12.9 Resignation of the Administrative Agent; Successor Administrative
Agent. Subject to the appointment and acceptance of a successor as provided
below, the Administrative Agent may resign at any time by giving notice thereof
to the Lenders and the Company. Upon any such resignation, the Required Lenders
shall have the right to appoint a successor Administrative Agent, which
successor shall have minimum capital and surplus of at least $500,000,000. If no
successor Administrative Agent shall have been so appointed by the Required
Lenders and shall have accepted such appointment within thirty (30) days after
the Administrative Agent’s giving of notice of resignation, then the
Administrative Agent may, on behalf of the Lenders, appoint a successor
Administrative Agent, which successor shall have minimum capital and surplus of
at least $500,000,000. Upon the acceptance of any appointment as Administrative
Agent hereunder by a successor Administrative Agent, such successor
Administrative Agent shall thereupon succeed to and become vested with all
rights, powers, privileges and duties of the retiring Administrative Agent, and
the retiring Administrative Agent shall be discharged from its duties and
obligations hereunder. After any retiring Administrative Agent’s resignation
hereunder as Administrative Agent, the provisions of this Section 12.9 shall
continue in effect for its benefit in respect of any actions taken or omitted to
be taken by it while it was acting as Administrative Agent.

Section 12.10 Other Agents. None of the Lenders identified on the facing page,
in the introductory paragraph or on the signature pages to this Agreement as a
Co-Syndication Agent or Documentation Agent shall have any right, power,
obligation, liability, responsibility or duty under this Agreement other than
those applicable to all Lenders as such. Without limiting the foregoing, none of
the Lenders so identified shall have or be deemed to have any fiduciary
relationship with any Lender. Each Lender acknowledges that it has not relied,
and will not rely, on any of the Lenders so identified in deciding to enter into
this Agreement or in taking or not taking action hereunder.

 

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ARTICLE XIII

MISCELLANEOUS

Section 13.1 Notices.

(a) Method of Communication. Except as otherwise provided in this Agreement, all
notices and communications hereunder shall be in writing (for purposes hereof,
the term “writing” shall include information in electronic format such as
electronic mail and internet web pages), or by telephone subsequently confirmed
in writing. Any notice shall be effective if: (i) delivered by hand delivery
(ii) sent via electronic mail, provided that the party sending such electronic
mail does not receive notice that such electronic mail has failed to reach the
Person or Persons to whom such notice is to be given, (iii) posting on an
internet web page accessible by the Person or Persons to whom the notice is to
be given, immediately following notice of such posting by electronic mail,
(iv) facsimile, (v) recognized overnight courier service or (vi) certified mail,
return receipt requested, and shall be presumed to be received by a party hereto
(a) on the date of delivery if delivered by hand or sent by electronic mail as
provided in (ii) above, posting on an internet web page as provided in
(iii) above, facsimile, (b) on the next Business Day if sent by recognized
overnight courier service and (c) on the third Business Day following the date
sent by certified mail, return receipt requested. A telephonic notice to the
Administrative Agent as understood by the Administrative Agent will be deemed to
be the controlling and proper notice in the event of a discrepancy with or
failure to receive a confirming written notice.

(b) Addresses for Notices. Notices to any party shall be sent to it at the
following addresses, or any other address as to which all the other parties are
notified in writing.

 

If to the Borrowers:    Belk, Inc.    2801 West Tyvola Road    Charlotte, North
Carolina 28217-4500    Attention: Chief Financial Officer    Telephone No.:
(704) 426-8250 With copies to:    Belk Stores Services, Inc.    Legal Department
   2801 West Tyvola Road    Charlotte, North Carolina 28217-4500    Attention:
General Counsel    Telephone No.: (704) 426-8403    Fax No.: (704) 357-1883

 

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If to Wells Fargo as    Wells Fargo Bank, National Association    MAC D 1109-019
   1525 West W.T. Harris Blvd.    Charlotte, North Carolina 28262    Attention:
Syndication Agency Services    Telephone No.: (704) 590-2703    Fax No.:
(704) 590-3481 With copies to:    Wells Fargo Bank, National Association    One
Wells Fargo Center, MAC D1053-150    301 South College Street    Charlotte,
North Carolina 28288-0680    Attention: Scott Santa Cruz                      
 Max Redic    Telephone No.: (704) 383-1988    Fax No.: (704) 383-7611   
Robinson Bradshaw & Hinson, P.A.    101 North Tryon Street, Suite 1900   
Charlotte, North Carolina 28246    Attention: Jeffrey A. Henson    Telephone
No.: (704) 377-8342    Fax No.: (704) 373-3942 If to any Lender:    To the
address set forth in the Register.

(c) Administrative Agent’s Office. The Administrative Agent hereby designates
its office located at the address set forth above, or any subsequent office
which shall have been specified for such purpose by written notice to the
Company and Lenders, as the Administrative Agent’s Office referred to herein, to
which payments due are to be made and at which Loans will be disbursed and
Letters of Credit Issued.

Section 13.2 Expenses; Indemnity. The Borrowers will (a) pay all reasonable
out-of-pocket expenses (including, without limitation, all costs of electronic
or internet distribution of any information hereunder) of the Administrative
Agent in connection with (i) the preparation, execution and delivery of this
Agreement and each other Loan Document, whenever the same shall be executed and
delivered, including without limitation all out-of-pocket syndication and due
diligence expenses and reasonable fees and disbursements of counsel for the
Administrative Agent and (ii) the preparation, execution and delivery of any
waiver, amendment or consent by the Administrative Agent or the Lenders relating
to this Agreement or any other Loan Document, including without limitation
reasonable fees and disbursements of counsel for the Administrative Agent,
(b) pay all reasonable out-of-pocket expenses of the Administrative Agent and
each Lender actually incurred in connection with the administration and
enforcement of any rights and remedies of the Administrative Agent and Lenders
under the Credit Facility, including, without limitation, in connection with any
workout, restructuring, bankruptcy or other similar proceeding, enforcing any
Obligations of, or collecting any payments due from, any Borrower or by reason
of an Event of Default; consulting with appraisers, accountants, engineers,
attorneys

 

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and other Persons concerning the nature, scope or value of any right or remedy
of the Administrative Agent or any Lender hereunder or under any other Loan
Document or any factual matters in connection therewith, which expenses shall
include without limitation the reasonable fees and disbursements of such
Persons, and (c) defend, indemnify and hold harmless the Administrative Agent,
each Lender and each Issuing Lender, and each Related Party of any of the
foregoing Persons (each such Person being called an “Indemnitee”), from and
against any losses, penalties, fines, liabilities, settlements, damages, costs
and expenses, suffered by any such Person in connection with any claim
(including, without limitation, any Environmental Claims or civil penalties or
fines assessed in connection with any violation of any Sanctions),
investigation, litigation or other proceeding (whether or not the Administrative
Agent or any Lender is a party thereto, and whether or not any such claim,
investigation, litigation or other proceeding is brought or otherwise instituted
by any Borrower or any third party) and the prosecution and defense thereof,
arising out of or in any way connected with the Loans, this Agreement, any other
Loan Document or any documents, reports or other information provided to the
Administrative Agent or any Lender or contemplated by or referred herein or
therein or the transactions contemplated hereby or thereby, including, without
limitation, reasonable attorney’s and consultant’s fees, except to the extent
that any of the foregoing directly result from the gross negligence or willful
misconduct of the Indemnitee seeking indemnification therefor as determined in a
final and non-appealable judgment by a court of competent jurisdiction.

Section 13.3 Set-off. In addition to any rights now or hereafter granted under
Applicable Law and not by way of limitation of any such rights, upon and after
the occurrence of any Event of Default and during the continuance thereof, the
Lenders and any assignee or participant of a Lender in accordance with
Section 13.9 are hereby authorized by the Borrowers at any time or from time to
time, without notice to the Borrowers or to any other Person, any such notice
being hereby expressly waived, to set off and to appropriate and to apply any
and all deposits (general or special, time or demand, including, but not limited
to, indebtedness evidenced by certificates of deposit, whether matured or
unmatured) and any other indebtedness at any time held or owing by the Lenders,
or any such assignee or participant to or for the credit or the account of any
Borrower against and on account of the Obligations irrespective of whether or
not (a) the Lenders shall have made any demand under this Agreement or any of
the other Loan Documents or (b) the Administrative Agent shall have declared any
or all of the Obligations to be due and payable as permitted by Section 11.2 and
although such Obligations shall be contingent or unmatured. Notwithstanding the
preceding sentence, each Lender agrees to notify the Company and the
Administrative Agent after any such set-off and application, provided that the
failure to give such notice shall not affect the validity of such set-off and
application.

Section 13.4 Governing Law. This Agreement, the Notes and the other Loan
Documents, unless otherwise expressly set forth therein, shall be governed by,
construed and enforced in accordance with the laws of the State of North
Carolina, without reference to the conflicts or choice of law principles
thereof.

Section 13.5 Jurisdiction and Venue.

(a) Jurisdiction. The Borrowers hereby irrevocably consent to the personal
jurisdiction of the state and federal courts located in Mecklenburg County,
North Carolina (and

 

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any courts from which an appeal from any of such courts must or may be taken),
in any action, claim or other proceeding arising out of any dispute in
connection with this Agreement, the Notes and the other Loan Documents, any
rights or obligations hereunder or thereunder, or the performance of such rights
and obligations. The Borrowers hereby irrevocably consent to the service of a
summons and complaint and other process in any action, claim or proceeding
brought by the Administrative Agent or any Lender in connection with this
Agreement, the Notes or the other Loan Documents, any rights or obligations
hereunder or thereunder, or the performance of such rights and obligations, on
behalf of itself or its property, in the manner specified in Section 13.1.
Nothing in this Section 13.5 shall affect the right of the Administrative Agent
or any Lender to serve legal process in any other manner permitted by Applicable
Law or affect the right of the Administrative Agent or any Lender to bring any
action or proceeding against any Borrower or its properties in the courts of any
other jurisdictions.

(b) Venue. The Borrowers hereby irrevocably waive any objection they may have
now or in the future to the laying of venue in the aforesaid jurisdiction in any
action, claim or other proceeding arising out of or in connection with this
Agreement, any other Loan Document or the rights and obligations of the parties
hereunder or thereunder. The Borrowers irrevocably waive, in connection with
such action, claim or proceeding, any plea or claim that the action, claim or
other proceeding has been brought in an inconvenient forum.

Section 13.6 Reversal of Payments. To the extent any Borrower makes a payment or
payments to the Administrative Agent for the ratable benefit of the Lenders or
the Administrative Agent receives any payment or proceeds of the collateral
which payments or proceeds or any part thereof are subsequently invalidated,
declared to be fraudulent or preferential, set aside and/or required to be
repaid to a trustee, receiver or any other party under any bankruptcy law, state
or federal law, common law or equitable cause, then, to the extent of such
payment or proceeds repaid, the Obligations or part thereof intended to be
satisfied shall be revived and continued in full force and effect as if such
payment or proceeds had not been received by the Administrative Agent.

Section 13.7 Injunctive Relief; Punitive Damages.

(a) The Borrowers recognize that, in the event a Borrower fails to perform,
observe or discharge any of its obligations or liabilities under this Agreement,
any remedy of law may prove to be inadequate relief to the Lenders. Therefore,
the Borrowers agree that the Lenders, at the Lenders’ option, shall be entitled
to temporary and permanent injunctive relief in any such case without the
necessity of proving actual damages.

(b) The Administrative Agent, the Lenders and the Company (on behalf of itself
and its Subsidiaries) hereby agree that no such Person shall have a remedy of
special, consequential, punitive or exemplary damages against any other party to
a Loan Document and each such Person hereby waives any right or claim to
special, consequential, punitive or exemplary damages that they may now have or
may arise in the future in connection with any dispute, whether such dispute is
resolved through arbitration or judicially.

Section 13.8 Accounting Matters. Except as otherwise expressly provided herein,
all terms of an accounting or financial nature shall be construed in accordance
with GAAP, as in

 

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effect from time to time, provided that, if at any time any change in GAAP or
mandatory adoption of another accounting method would affect the computation of
any financial ratio or requirement set forth in any Loan Document, and either
the Borrowers or the Required Lenders shall so request, the Administrative
Agent, the Lenders and the Borrowers shall negotiate in good faith to amend such
ratio or requirement to preserve the original intent thereof in light of such
change in GAAP or mandatory adoption of another accounting method (subject to
the approval of the Required Lenders); provided, further, that, until so
amended, (i) such ratio or requirement shall continue to be computed in
accordance with GAAP prior to such change therein and (ii) the Borrowers 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.
Notwithstanding the foregoing, for purposes of determining compliance with any
covenant (including the computation of any financial covenant) contained herein,
Debt of the Borrowers and their Subsidiaries shall be deemed to be carried at
100% of the outstanding principal amount thereof, plus or minus any associated
unamortized original issue premium or discount, and the effects of FASB ASC 825
and FASB ASC 470-20 on financial liabilities shall be disregarded.

Section 13.9 Successors and Assigns; Participations.

(a) Benefit of Agreement. This Agreement shall be binding upon and inure to the
benefit of the Borrowers, the Administrative Agent and the Lenders, all future
holders of the Notes, and their respective successors and assigns, except that
the Borrowers shall not assign or transfer any of their rights or obligations
under this Agreement without the prior written consent of each Lender.

(b) Assignment by Lenders. Each Lender may, in the ordinary course of its
business and in accordance with Applicable Law, sell or assign to any Lender,
any Approved Fund or any Affiliate of a Lender and with the consent of the
Company (so long as no Default or Event of Default has occurred and is
continuing) and the consent of the Administrative Agent, which consents shall
not be unreasonably withheld or delayed, assign to one or more other Eligible
Assignees all or a portion of its interests, rights and obligations under this
Agreement and the other Loan Documents (including, without limitation, all or a
portion of the Extensions of Credit at the time owing to it and the Notes held
by it or participating interest in the Existing Letters of Credit); provided
that:

(i) each such assignment shall be of a constant, and not a varying, percentage
of all the assigning Lender’s rights and obligations under this Agreement;

(ii) if less than all of the assigning Lender’s Revolving Credit Commitment is
to be assigned, the Revolving Credit Commitment so assigned shall not be less
than $1,000,000;

(iii) the assignee shall have delivered to the Administrative Agent all United
States Internal Revenue Service Forms required pursuant to Section 4.11(e) and
all of the parties to each such assignment shall execute and deliver to the
Administrative Agent, for its acceptance and recording in the Register, an
Assignment and Assumption substantially in the form of Exhibit G attached hereto
(an “Assignment and Assumption”), together with any Note or Notes subject to
such assignment;

 

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(iv) where consent of the Borrowers to an assignment to a assignee is required
hereunder, the Borrowers shall be deemed to have given its consent ten
(10) Business Days after the date written notice thereof has been delivered by
the assigning Lender (through the Administrative Agent) unless such consent is
expressly refused by the Borrowers prior to such tenth (10th) Business Day;

(v) such assignment shall not, without the consent of the Company, require any
Borrower to file a registration statement with the Securities and Exchange
Commission or apply to or qualify the Loans or the Notes under the blue sky laws
of any state; and

(vi) the assigning Lender shall pay to the Administrative Agent an assignment
fee of $3,500 upon the execution by such Lender of the Assignment and
Assumption; provided that no such fee shall be payable upon any assignment by a
Lender to an Affiliate thereof.

Upon such execution, delivery, acceptance and recording, from and after the
effective date specified in each Assignment and Assumption, which effective date
shall be at least five (5) Business Days after the execution thereof (unless
otherwise agreed to by the Administrative Agent), (A) the assignee thereunder
shall be a party hereto and, to the extent provided in such Assignment and
Assumption, have the rights and obligations of a Lender hereby and (B) the
Lender thereunder shall, to the extent provided in such assignment, be released
from its obligations under this Agreement.

(c) Rights and Duties Upon Assignment. By executing and delivering an Assignment
and Assumption, the assigning Lender thereunder and the assignee thereunder
confirm to and agree with each other and the other parties hereto as set forth
in such Assignment and Assumption.

(d) Register. The Administrative Agent shall maintain a copy of each Assignment
and Assumption delivered to it and a register for the recordation of the name
and address of each Lender, the amount of the Revolving Credit Commitment with
respect to each Lender from time to time and the amount of Extensions of Credit
with respect to each Lender from time to time (the “Register”). The entries in
the Register shall be conclusive, in the absence of manifest error, and the
Borrowers, the Administrative Agent and the Lenders may treat each person whose
name is recorded in the Register as a Lender hereunder for all purposes of this
Agreement. The Register shall be available for inspection by the Company or any
Lender at any reasonable time and from time to time upon reasonable prior
notice.

(e) Issuance of New Notes. Upon its receipt of an Assignment and Assumption
executed by an assigning Lender and another Lender, an Approved Fund, an
Affiliate of a Lender or an Eligible Assignee together with any Note or Notes
(if applicable) subject to such assignment and (if applicable) the written
consent to such assignment, the

 

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Administrative Agent shall, if such Assignment and Assumption has been completed
and is substantially in the form of Exhibit G:

(i) accept such Assignment and Assumption;

(ii) record the information contained therein in the Register;

(iii) give prompt notice thereof to the Lenders and the Company; and

(iv) promptly deliver a copy of such Assignment and Assumption to the Company.

Within five (5) Business Days after receipt of notice, the Borrowers shall
execute and deliver to the Administrative Agent, in exchange for the surrendered
Note or Notes, a new Note or Notes to the order of such Lender, Approved Fund,
Affiliate of a Lender or Eligible Assignee (to the extent requested thereby) in
amounts equal to the Revolving Credit Commitment assumed by it pursuant to such
Assignment and Assumption and a new Note or Notes to the order of the assigning
Lender (to the extent requested thereby) in an amount equal to the Revolving
Credit Commitment retained by it hereunder. Such new Note or Notes shall be in
an aggregate principal amount equal to the aggregate principal amount of such
surrendered Note or Notes, shall be dated the effective date of such Assignment
and Assumption and shall otherwise be in substantially the form of the assigned
Notes delivered to the assigning Lender. Each surrendered Note or Notes shall be
canceled and returned to the Company.

(f) Participations. Each Lender may, without notice to and without the consent
of the Borrowers (except that the Borrowers’ consent may be required in
accordance with the last paragraph of this clause (f)) or the Administrative
Agent, in the ordinary course of its commercial banking business and in
accordance with Applicable Law, sell participations to one or more banks or
other entities in all or a portion of its rights and obligations under this
Agreement (including, without limitation, all or a portion of its Extensions of
Credit and the Notes held by it); provided that:

(i) each such participation shall be in an amount not less than $1,000,000;

(ii) such Lender’s obligations under this Agreement (including, without
limitation, its Revolving Credit Commitment) shall remain unchanged;

(iii) such Lender shall remain solely responsible to the other parties hereto
for the performance of such obligations;

(iv) such Lender shall remain the holder of the Notes held by it for all
purposes of this Agreement;

(v) the Borrowers, the Administrative Agent and the other Lenders shall continue
to deal solely and directly with such Lender in connection with such Lender’s
rights and obligations under this Agreement;

 

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(vi) such Lender shall not permit such participant the right to approve any
waivers, amendments or other modifications to this Agreement or any other Loan
Document other than waivers, amendments or modifications which would reduce the
principal of or the interest rate on any Loan or Reimbursement Obligation,
extend the term or increase the amount of the Revolving Credit Commitment,
reduce the amount of any fees to which such participant is entitled or extend
any scheduled payment date for principal of any Loan; and

(vii) any such disposition shall not, without the consent of the Company,
require any Borrower to file a registration statement with the Securities and
Exchange Commission to apply to qualify the Loans or the Notes under the blue
sky law of any state.

The Borrowers agree that each participant shall be entitled to the benefits of
Sections 4.7, 4.8, 4.9, 4.10, 4.11 and 13.2 to the same extent as if it were a
Lender and had acquired its interest by assignment pursuant to paragraph (b) of
this Section 13.9; provided that a participant shall not be entitled to receive
any greater payment under Sections 4.7, 4.8, 4.9, 4.10, and 4.11 than the
applicable Lender would have been entitled to receive with respect to the
participation sold to such participant, unless the sale of the participation to
such participant is made with the Borrowers’ prior written consent and such
participant shall have delivered to the Administrative Agent all United States
Internal Revenue Service Forms required pursuant to Section 4.11(e). Each Lender
that sells a participation shall, acting solely for this purpose as a
non-fiduciary agent of the Borrowers, 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
(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) to any Person 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. 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. For the avoidance of doubt, the Administrative Agent (in its
capacity as Administrative Agent) shall have no responsibility for maintaining a
Participant Register.

(g) Disclosure of Information; Confidentiality. The Administrative Agent and the
Lenders shall hold all non-public information with respect to the Borrowers
obtained pursuant to the Loan Documents (or any Hedging Agreement or Cash
Management Agreement with a Lender or the Administrative Agent) in accordance
with their customary procedures for handling confidential information; provided,
that the Administrative Agent and each of the institutions identified on the
cover page hereof as “Joint Lead Arrangers” may disclose information relating to
this Agreement to Gold Sheets and other similar bank trade publications, such
information to consist of deal terms and other information customarily found in
such publications and provided further, that the Administrative Agent or any
Lender may disclose any such information to the extent such disclosure is
(i) required by law or requested or required

 

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pursuant to any legal process, (ii) requested by, or required to be disclosed
to, any rating agency, or regulatory or similar authority (including, without
limitation, the National Association of Insurance Commissioners), (iii) used in
any suit, action or proceeding for the purpose of defending itself, reducing its
liability or protecting any of its claims, rights, remedies or interests under
or in connection with the Loan Documents (or any Hedging Agreement or Cash
Management Agreement with a Lender or the Administrative Agent) or
(iv) otherwise consented to by the Company. The Administrative Agent or any
Lender may, in connection with any sale, proposed sale, assignment, proposed
assignment, participation or proposed participation pursuant to Section 2.7 or
this Section 13.9, disclose to the assignee, participant, proposed assignee,
proposed participant or to any direct or indirect contractual counterparty in
swap agreements or such contractual counterparty’s professional advisor, any
information relating to the Borrowers furnished to such Lender by or on behalf
of the Borrowers; provided, that prior to any such disclosure, each such New
Lender or proposed New Lender, assignee, proposed assignee, participant,
proposed participant or professional advisor shall agree to be bound by the
provisions of this Section 13.9(g).

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

Section 13.10 Amendments, Waivers and Consents. Except as set forth below or as
specifically provided in any Loan Document, including, without limitation,
Section 2.7 hereof, any term, covenant, agreement or condition of this Agreement
or any of the other Loan Documents may be amended or waived by the Lenders, and
any consent given by the Lenders, if, but only if, such amendment, waiver or
consent is in writing signed by the Required Lenders (or by the Administrative
Agent with the consent of the Required Lenders) and delivered to the
Administrative Agent and, in the case of an amendment, signed by the Borrowers;
provided, that no amendment, waiver or consent shall (a) increase the Aggregate
Commitment or increase the amount of the Loans, (b) reduce the rate of interest
or fees payable on any Loan or Reimbursement Obligation, (c) reduce or forgive
the principal amount of any Loan or Reimbursement Obligation, (d) extend the
originally scheduled time or times of payment of the principal of any Loan or
Reimbursement Obligation or the time or times of payment of interest on any Loan
or Reimbursement Obligation or any fee or commission with respect thereto,
(e) permit any subordination of the principal or interest on any Loan or
Reimbursement Obligation, (f) release any Borrower from the Obligations (other
than Hedging Obligations and obligations under Cash Management Agreements)
hereunder, (g) permit any assignment (other than as specifically permitted or
contemplated in this Agreement) of any of a Borrower’s rights and obligations
hereunder, (h) amend Section 4.4 or Section 4.5 in a manner that would alter the
pro rata sharing of payments required thereby, (i) amend the provisions of this
Section 13.10 or the definition of Required Lenders, in each case, without the
prior written consent of each Lender or (j) extend the time of the obligation of
the Lenders holding Revolving Credit Commitments to make or Issue or participate
in Letters of Credit, in each case, without the prior written consent of each
Lender. In addition, no amendment, waiver or consent to the provisions of
(a) Article XII shall be made without the written consent of the Administrative
Agent and (b)

 

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Article III without the written consent of each Issuing Lender. Notwithstanding
anything to the contrary herein, no Defaulting Lender shall have any right to
approve or disapprove any amendment, waiver or consent hereunder, except that
the Revolving Credit Commitment of such Lender may not be increased or extended
without the consent of such Lender.

Section 13.11 Performance of Duties. The Borrowers’ obligations under this
Agreement and each of the other Loan Documents shall be performed by the
Borrowers at their sole cost and expense.

Section 13.12 All Powers Coupled with Interest. All powers of attorney and other
authorizations granted to the Lenders, the Administrative Agent and any Persons
designated by the Administrative Agent or any Lender pursuant to any provisions
of this Agreement or any of the other Loan Documents shall be deemed coupled
with an interest and shall be irrevocable so long as any of the Obligations
remain unpaid or unsatisfied, any of the Revolving Credit Commitments remain in
effect or the Credit Facility has not been terminated.

Section 13.13 Survival of Indemnities. Notwithstanding any termination of this
Agreement, the indemnities to which the Administrative Agent and the Lenders are
entitled under the provisions of this Article XIII and any other provision of
this Agreement and the other Loan Documents shall continue in full force and
effect and shall protect the Administrative Agent and the Lenders against events
arising after such termination as well as before.

Section 13.14 Titles and Captions. Titles and captions of Articles, Sections and
subsections in, and the table of contents of, this Agreement are for convenience
only, and neither limit nor amplify the provisions of this Agreement.

Section 13.15 Severability of Provisions. Any provision of this Agreement or any
other Loan Document which is prohibited or unenforceable in any jurisdiction
shall, as to such jurisdiction, be ineffective only to the extent of such
prohibition or unenforceability without invalidating the remainder of such
provision or the remaining provisions hereof or thereof or affecting the
validity or enforceability of such provision in any other jurisdiction.

Section 13.16 Counterparts; Integration. This Agreement may be executed in any
number of counterparts and by different parties hereto in separate counterparts,
each of which when so executed shall be deemed to be an original and shall be
binding upon all parties, their successors and assigns, and all of which taken
together shall constitute one and the same agreement. 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.

Section 13.17 Term of Agreement. This Agreement shall remain in effect from the
Closing Date through and including the date upon which all Obligations arising
hereunder or under any other Loan Document shall have been indefeasibly and
irrevocably paid and satisfied in full and all Revolving Credit Commitments have
been terminated. No termination of this Agreement shall affect the rights and
obligations of the parties hereto arising prior to such termination or in
respect of any provision of this Agreement which survives such termination.

 

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Section 13.18 Advice of Counsel. Each of the parties represents to each other
party hereto that it has discussed this Agreement with its counsel.

Section 13.19 No Strict Construction. The parties hereto have participated
jointly in the negotiation and drafting of this Agreement. In the event an
ambiguity or question of intent or interpretation arises, this Agreement shall
be construed as if drafted jointly by the parties hereto and no presumption or
burden of proof shall arise favoring or disfavoring any party by virtue of the
authorship of any provisions of this Agreement.

Section 13.20 Inconsistencies with Other Documents; Independent Effect of
Covenants.

(a) In the event there is a conflict or inconsistency between this Agreement and
any other Loan Document, the terms of this Agreement shall control.

(b) The Borrowers expressly acknowledge and agree that each covenant contained
in Articles VIII, IX or X hereof shall be given independent effect. Accordingly,
the Borrowers shall not engage in any transaction or other act otherwise
prohibited under any covenant contained in Articles VIII, IX or X if, before or
after giving effect to such transaction or act, the Borrowers shall or would be
in breach of any other covenant contained in Articles IX, X or XI.

Section 13.21 Effect of Agreement. The parties hereto agree that this Agreement
is intended as a continuation, amendment and restatement of the Existing Credit
Agreement and shall not constitute a novation of the Existing Credit Agreement.

Section 13.22 USA Patriot Act. The Administrative Agent and each 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 to identify such Borrower in
accordance with the Act.

[Signature pages to follow]

 

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

 

BELK, INC., as a Borrower By:  

 

 

Adam M. Orvos

Executive Vice President and Chief Financial Officer

BELK ADMINISTRATION COMPANY, as a Borrower By:  

 

 

Adam M. Orvos

Executive Vice President and Chief Financial Officer

BELK INTERNATIONAL, INC., as a Borrower By:  

 

 

Adam M. Orvos

Executive Vice President and Chief Financial Officer

BELK STORES SERVICES, INC., as a Borrower By:  

 

 

Adam M. Orvos

Executive Vice President and Chief Financial Officer

BELK-SIMPSON COMPANY, GREENVILLE, SOUTH CAROLINA, as a Borrower By:  

 

  Adam M. Orvos   Executive Vice President and Chief Financial Officer

 

[Signature Pages Continue]

 

Fourth Amended and Restated Credit Agreement

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

THE BELK CENTER, INC., as a Borrower By:  

 

  Adam M. Orvos   Executive Vice President and Chief Financial Officer BELK
ACCOUNTS RECEIVABLE LLC, as a Borrower By:  

 

  Adam M. Orvos   Executive Vice President and Chief Financial Officer BELK
STORES OF VIRGINIA LLC, as a Borrower By:  

 

  Adam M. Orvos   Executive Vice President and Chief Financial Officer BELK GIFT
CARD COMPANY LLC, as a Borrower By:  

 

  Adam M. Orvos   Executive Vice President and Chief Financial Officer BELK
MERCHANDISING LLC, as a Borrower By:  

 

  Adam M. Orvos   Executive Vice President and Chief Financial Officer

 

[Signature Pages Continue]

 

Fourth Amended and Restated Credit Agreement

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

BELK TEXAS HOLDINGS LLC, as a Borrower By:  

 

  Adam M. Orvos   Executive Vice President and Chief Financial Officer BELK
DEPARTMENT STORES LP, as a Borrower By:   Belk, Inc., its General Partner By:  

 

  Adam M. Orvos   Executive Vice President and Chief Financial Officer BELK
ECOMMERCE LLC, as a Borrower By:  

 

 

Adam M. Orvos

Executive Vice President and Chief Financial Officer

BELK STORES OF MISSISSIPPI LLC, as a Borrower By:  

 

  Adam M. Orvos   Executive Vice President and Chief Financial Officer

 

[Signature Pages Continue]

 

Fourth Amended and Restated Credit Agreement

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

WELLS FARGO BANK, NATIONAL ASSOCIATION By:  

 

  Name:   Title:

 

Fourth Amended and Restated Credit Agreement

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

BANK OF AMERICA, N.A. By:  

 

  Name:   Title:

 

Fourth Amended and Restated Credit Agreement

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

BRANCH BANKING AND TRUST COMPANY By:  

 

  Name:   Title:

 

Fourth Amended and Restated Credit Agreement

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

PNC BANK, NATIONAL ASSOCIATION By:  

 

  Name:   Title:

 

Fourth Amended and Restated Credit Agreement

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

REGIONS BANK By:  

 

  Name:   Title:

 

Fourth Amended and Restated Credit Agreement

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

U.S. BANK NATIONAL ASSOCIATION By:  

 

  Name:   Title:

 

Fourth Amended and Restated Credit Agreement

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

JPMORGAN CHASE BANK, N.A. By:  

 

  Name:   Title:

 

Fourth Amended and Restated Credit Agreement

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

NORTHERN TRUST COMPANY By:  

 

  Name:   Title:

 

Fourth Amended and Restated Credit Agreement

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

TD BANK, N.A. By:  

 

  Name:   Title:

 

Fourth Amended and Restated Credit Agreement

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

MECHANICS AND FARMERS BANK By:  

 

  Name:   Title:

 

Fourth Amended and Restated Credit Agreement

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EXHIBIT A-1

FORM OF REVOLVING CREDIT NOTE

This Revolving Credit Note amends and restates, but does not extinguish, all
Obligations under the Revolving Credit Notes executed by the Borrowers in favor
of the Lender in connection with the Existing Credit Agreement and as such
replaces any such Revolving Credit Notes.

REVOLVING CREDIT NOTE

 

$                                             ,    ,        

FOR VALUE RECEIVED, the undersigned, BELK, INC., a corporation organized under
the laws of Delaware (the “Company”), and the Subsidiaries of the Company listed
on the signature pages hereto (each a “Borrower” and together, the “Borrowers”)
hereby jointly and severally promise to pay to                 , (the “Lender”),
at the place and times provided in the Credit Agreement referred to below, the
principal sum of                 DOLLARS ($                ) or, if less, the
unpaid principal amount of all Revolving Credit Loans made by the Lender from
time to time pursuant to that certain Fourth Amended and Restated Credit
Agreement, dated as of October 22, 2014 (as amended, restated or otherwise
modified from time to time, the “Credit Agreement”) by and among the Borrowers,
the Lenders who are or may become a party thereto (collectively, the “Lenders”)
and Wells Fargo Bank, National Association, as Administrative Agent. Capitalized
terms used herein and not defined herein shall have the meanings assigned
thereto in the Credit Agreement.

The unpaid principal amount of this Revolving Credit Note from time to time
outstanding is subject to mandatory repayment from time to time as provided in
the Credit Agreement and shall bear interest as provided in Section 4.1 of the
Credit Agreement. All payments of principal and interest on this Revolving
Credit Note shall be payable in lawful currency of the United States in
immediately available funds to the account designated in the Credit Agreement.

This Revolving Credit Note is entitled to the benefits of, and evidences
Obligations incurred under, the Credit Agreement, to which reference is made for
a statement of the terms and conditions on which the Borrowers are permitted and
required to make prepayments and repayments of principal of the Obligations
evidenced by this Revolving Credit Note and on which such Obligations may be
declared to be immediately due and payable.

THIS REVOLVING CREDIT NOTE SHALL BE GOVERNED BY, CONSTRUED AND ENFORCED IN
ACCORDANCE WITH THE LAWS OF NORTH CAROLINA, WITHOUT REFERENCE TO THE CONFLICTS
OR CHOICE OF LAW PRINCIPLES THEREOF.

The Debt evidenced by this Revolving Credit Note is senior in right of payment
to all Subordinated Debt referred to in the Credit Agreement.

The Borrowers hereby waive all requirements as to diligence, presentment, demand
of payment, protest and (except as required by the Credit Agreement) notice of
any kind with respect to this Revolving Credit Note.

[Signature Pages Follow]

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IN WITNESS WHEREOF, the undersigned have executed this Revolving Credit Note
under seal as of the day and year first above written.

 

BELK, INC., as a Borrower By:  

 

  Name:   Title: BELK ADMINISTRATION COMPANY, as a Borrower By:  

 

  Name:   Title: BELK INTERNATIONAL, INC., as a Borrower By:  

 

  Name:   Title: BELK STORES SERVICES, INC., as a Borrower By:  

 

  Name:   Title: BELK-SIMPSON COMPANY, GREENVILLE, SOUTH CAROLINA, as a Borrower
By:  

 

  Name:   Title:

 

[Signature Pages Continue]

 

[Signature Page to Revolving Credit Note]

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

THE BELK CENTER, INC., as a Borrower By:  

 

 

Name:

Title:

BELK ACCOUNTS RECEIVABLE LLC, as a Borrower

By:  

 

  Name:   Title: BELK STORES OF VIRGINIA LLC, as a Borrower By:  

 

  Name:   Title: BELK GIFT CARD COMPANY LLC, as a Borrower By:  

 

  Name:   Title: BELK MERCHANDISING LLC, as a Borrower By:  

 

  Name:   Title:

 

[Signature Pages Continue]

 

[Signature Page to Revolving Credit Note]

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

BELK TEXAS HOLDINGS LLC, as a Borrower By:  

 

  Name:   Title: BELK DEPARTMENT STORES LP, as a Borrower By:   Belk, Inc., its
General Partner By:  

 

  Name:   Title: BELK ECOMMERCE LLC, as a Borrower By:  

 

  Name:   Title: BELK STORES OF MISSISSIPPI LLC, as a Borrower By:  

 

  Name:   Title:

 

[Signature Page to Revolving Credit Note]

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EXHIBIT A-2

FORM OF SWINGLINE NOTE

This Swingline Note amends and restates, but does not extinguish, all
Obligations under the Swingline Note executed by the Borrowers in favor of the
Lender in connection with the Existing Credit Agreement and as such replaces any
such Swingline Note.

SWINGLINE NOTE

 

$                                         ,        

FOR VALUE RECEIVED, the undersigned, BELK, INC., a corporation organized under
the laws of Delaware (the “Company”), and the Subsidiaries of the Company listed
on the signature pages hereto (each a “Borrower” and together, the “Borrowers”)
hereby jointly and severally promise to pay to WELLS FARGO BANK, NATIONAL
ASSOCIATION (the “Lender”), at the place and times provided in the Credit
Agreement referred to below, the principal sum of             DOLLARS
($            ) or, if less, the unpaid principal amount of all Swingline Loans
made by the Lender from time to time pursuant to that certain Fourth Amended and
Restated Credit Agreement, dated as of October 22, 2014 (as amended, restated or
otherwise modified from time to time, the “Credit Agreement”) by and among the
Borrowers, the Lenders who are or may become a party thereto (collectively, the
“Lenders”) and Wells Fargo Bank, National Association, as Administrative Agent.
Capitalized terms used herein and not defined herein shall have the meanings
assigned thereto in the Credit Agreement.

The unpaid principal amount of this Swingline Note from time to time outstanding
is subject to mandatory repayment from time to time as provided in the Credit
Agreement and shall bear interest as provided in Section 4.1 of the Credit
Agreement. Swingline Loans refunded as Revolving Credit Loans in accordance with
Section 2.2(c) of the Credit Agreement shall be payable by the Borrowers as
Revolving Credit Loans pursuant to the Revolving Credit Notes, and shall not be
payable under this Swingline Note as Swingline Loans. All payments of principal
and interest on this Swingline Note shall be payable in lawful currency of the
United States in immediately available funds to the account designated in the
Credit Agreement.

This Swingline Note is entitled to the benefits of, and evidences Obligations
incurred under, the Credit Agreement, to which reference is made for a statement
of the terms and conditions on which the Borrowers are permitted and required to
make prepayments and repayments of principal of the Obligations evidenced by
this Swingline Note and on which such Obligations may be declared to be
immediately due and payable.

THIS SWINGLINE NOTE SHALL BE GOVERNED BY, CONSTRUED AND ENFORCED IN ACCORDANCE
WITH THE LAWS OF NORTH CAROLINA, WITHOUT REFERENCE TO THE CONFLICTS OR CHOICE OF
LAW PRINCIPLES THEREOF.

The Debt evidenced by this Swingline Note is senior in right of payment to all
Subordinated Debt referred to in the Credit Agreement.

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

The Borrowers hereby waive all requirements as to diligence, presentment, demand
of payment, protest and (except as required by the Credit Agreement) notice of
any kind with respect to this Swingline Note.

[Signature Pages Follow]

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

IN WITNESS WHEREOF, the undersigned have executed this Swingline Note under seal
as of the day and year first above written.

 

BELK, INC., as a Borrower By:  

 

  Name:   Title: BELK ADMINISTRATION COMPANY, as a Borrower By:  

 

  Name:   Title: BELK INTERNATIONAL, INC., as a Borrower By:  

 

  Name:   Title: BELK STORES SERVICES, INC., as a Borrower By:  

 

  Name:   Title: BELK-SIMPSON COMPANY, GREENVILLE, SOUTH CAROLINA, as a Borrower
By:  

 

  Name:   Title:

 

[Signature Pages Continue]

 

[Signature Page to Swingline Note]

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

THE BELK CENTER, INC., as a Borrower By:  

 

  Name:   Title: BELK ACCOUNTS RECEIVABLE LLC, as a Borrower By:  

 

  Name:   Title: BELK STORES OF VIRGINIA LLC, as a Borrower By:  

 

  Name:   Title: BELK GIFT CARD COMPANY LLC, as a Borrower By:  

 

  Name:   Title: BELK MERCHANDISING LLC, as a Borrower By:  

 

  Name:   Title:

 

[Signature Pages Continue]

 

[Signature Page to Swingline Note]

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

BELK TEXAS HOLDINGS LLC, as a Borrower By:  

 

  Name:   Title: BELK DEPARTMENT STORES LP, as a Borrower By:   Belk, Inc., its
General Partner By:  

 

  Name:   Title: BELK ECOMMERCE LLC, as a Borrower By:  

 

  Name:   Title: BELK STORES OF MISSISSIPPI LLC, as a Borrower By:  

 

  Name:   Title:

 

[Signature Page to Swingline Note]

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

EXHIBIT B

FORM OF NOTICE OF BORROWING

Dated as of:             

Wells Fargo Bank, National Association,

as Administrative Agent

MAC D 1109-019

1525 West W.T. Harris Blvd.

Charlotte, North Carolina 28262

Attention: Syndication Agency Services

Ladies and Gentlemen:

This irrevocable Notice of Borrowing is delivered to you pursuant to the Fourth
Amended and Restated Credit Agreement dated as of October 22, 2014 (as amended,
restated or otherwise modified from time to time, the “Credit Agreement”), by
and among Belk, Inc., a Delaware corporation (the “Company”), the Subsidiaries
of the Company listed on the signature pages thereto (each a “Borrower” and
together, the “Borrowers”), the lenders party thereto (the “Lenders”) and Wells
Fargo Bank, National Association, as Administrative Agent.

1. The Borrowers hereby request that the Lenders make a [Revolving Credit Loan]
[Swingline Loan] to the Borrowers in the aggregate principal amount of
$            . (Complete with an amount in accordance with Section 2.3(a) of the
Credit Agreement.)

2. The Borrowers hereby request that such Loan be made on the following Business
Day:             . (Complete with a Business Day in accordance with
Section 2.3(a) of the Credit Agreement).

3. The Borrowers hereby request that the Loan bear interest at the following
interest rate, plus the Applicable Margin, as set forth below:

 

Component

Of Loan

  

Interest Rate

  

Interest Period

(LIBOR

Rate only)

  

Termination Date for Interest
Period (if applicable)

  

[Base Rate, LIBOR

Rate or Libor Market Index Rate (Swingline Loans only)]

     

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

4. The principal amount of all Loans and L/C Obligations outstanding as of the
date hereof (including the requested Loan) does not exceed the maximum amount
permitted to be outstanding pursuant to the terms of the Credit Agreement.

5. All of the conditions applicable to the Loan requested herein as set forth in
the Credit Agreement have been satisfied as of the date hereof and will remain
satisfied to the date of such Loan.

6. Capitalized terms used herein and not defined herein shall have the meanings
assigned thereto in the Credit Agreement.

[Signature Page Follows]

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

IN WITNESS WHEREOF, the undersigned has executed this Notice of Borrowing as of
the day and year first above written.

 

BELK, INC., on behalf of itself and the other Borrowers By  

 

  Name:   Title:

 

[Signature Page to Notice of Borrowing]

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

EXHIBIT C

FORM OF NOTICE OF ACCOUNT DESIGNATION

Dated as of:             

Wells Fargo Bank, National Association,

as Administrative Agent

MAC D 1109-019

1525 West W.T. Harris Blvd.

Charlotte, North Carolina 28262

Attention: Syndication Agency Services

Ladies and Gentlemen:

This Notice of Account Designation is delivered to you under Section 2.3(b) of
the Fourth Amended and Restated Credit Agreement dated as of October 22, 2014
(as amended, restated or otherwise modified from time to time, the “Credit
Agreement”), by and among Belk, Inc., a Delaware corporation (the “Company”),
the Subsidiaries of the Company listed on the signature pages thereto (each a
“Borrower” and together, the “Borrowers”), the lenders party thereto and Wells
Fargo Bank, National Association, as Administrative Agent.

1. The Administrative Agent is hereby authorized to disburse all Loan proceeds
into the following account(s):

 

 

 

    ABA Routing Number:  

 

    Account Number:  

                                      

 

2. This authorization shall remain in effect until revoked or until a subsequent
Notice of Account Designation is provided to the Administrative Agent.

3. Capitalized terms used herein and not defined herein shall have the meanings
assigned thereto in the Credit Agreement.

[Signature Page Follows]

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

IN WITNESS WHEREOF, the undersigned has executed this Notice of Account
Designation as of the day and year first above written.

 

BELK, INC., on behalf of itself and the other Borrowers By:  

 

  Name:   Title:

 

[Signature Page to Notice of Account Designation]

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

EXHIBIT D

FORM OF NOTICE OF REPAYMENT

Dated as of:             

Wells Fargo Bank, National Association,

as Administrative Agent

MAC D 1109-019

1525 West W.T. Harris Blvd.

Charlotte, North Carolina 28262

Attention: Syndication Agency Services

Ladies and Gentlemen:

This irrevocable Notice of Repayment is delivered to you under Section 2.4(c) of
the Fourth Amended and Restated Credit Agreement dated as of October 22, 2014
(as amended, restated or otherwise modified from time to time, the “Credit
Agreement”), by and among Belk, Inc., a Delaware corporation (the “Company”),
the Subsidiaries of the Company listed on the signature pages thereto (each a
“Borrower” and together, the “Borrowers”), the lenders party thereto and Wells
Fargo Bank, National Association, as Administrative Agent.

1. The Borrowers hereby provide notice to the Administrative Agent that they
shall repay the following [Base Rate Loans] [LIBOR Rate Loans] and/or [LIBOR
Market Index Rate Loans]:             .

(Complete with an amount in accordance with Section 2.4 of the Credit
Agreement.)

2. The Loan to be prepaid is a [check each applicable box]

 

  ¨ Swingline Loan

 

  ¨ Revolving Credit Loan

3. The Borrowers shall repay the above-referenced Loans on the following
Business Day:             . (Complete with a Business Day at least one
(1) Business Day subsequent to the date of this Notice of Repayment with respect
to any Swingline Loan or any Base Rate Loan and three (3) Business Days
subsequent to date of this Notice of Prepayment with respect to any LIBOR Rate
Loan. )

4. Capitalized terms used herein and not defined herein shall have the meanings
assigned thereto in the Credit Agreement.

[Signature Page Follows]

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

IN WITNESS WHEREOF, the undersigned has executed this Notice of Repayment as of
the day and year first above written.

 

BELK, INC., on behalf of itself and the other Borrowers By:  

 

  Name:   Title:

 

[Signature Page to Notice of Repayment]

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

EXHIBIT E

FORM OF NOTICE OF CONVERSION/CONTINUATION

Dated as of:             

Wells Fargo Bank, National Association,

as Administrative Agent

MAC D 1109-019

1525 West W.T. Harris Blvd.

Charlotte, North Carolina 28262

Attention: Syndication Agency Services

Ladies and Gentlemen:

This irrevocable Notice of Conversion/Continuation (the “Notice”) is delivered
to you under Section 4.2 of the Fourth Amended and Restated Credit Agreement
dated as of October 22, 2014 (as amended, restated or otherwise modified from
time to time, the “Credit Agreement”), by and among Belk, Inc., a Delaware
corporation (the “Company”), the Subsidiaries of the Company listed on the
signature pages thereto (each a “Borrower” and together, the “Borrowers”), the
lenders party thereto and Wells Fargo Bank, National Association, as
Administrative Agent.

1. The Loan to which this Notice relates is a Revolving Credit Loan.

2. This Notice is submitted for the purpose of:

    (Check one and complete applicable information in accordance with the Credit
Agreement.)

 

  ¨ Converting all or a portion of a Base Rate Loan into a LIBOR Rate Loan

 

  (a) The aggregate outstanding principal balance of such Loan is $            .

 

  (b) The principal amount of such Loan to be converted is $            .

 

  (c) The requested effective date of the conversion of such Loan is
            .

 

  (d) The requested Interest Period applicable to the converted Loan is
            .

 

  ¨ Converting all or a portion of a LIBOR Rate Loan into a Base Rate Loan

 

  (a) The aggregate outstanding principal balance of such Loan is $            .

 

  (b) The last day of the current Interest Period for such Loan is             .

 

  (c) The principal amount of such Loan to be converted is $            .

 

  (d) The requested effective date of the conversion of such Loan is
            .

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

  ¨ Continuing all or a portion of a LIBOR Rate Loan as a LIBOR Rate Loan

 

  (a) The aggregate outstanding principal balance of such Loan is $            .

 

  (b) The last day of the current Interest Period for such Loan is             .

 

  (c) The principal amount of such Loan to be continued is $            .

 

  (d) The requested effective date of the continuation of such Loan is
            .

 

  (e) The requested Interest Period applicable to the continued Loan is
            .

3. The principal amount of all Loans and L/C Obligations outstanding as of the
date hereof does not exceed the maximum amount permitted to be outstanding
pursuant to the terms of the Credit Agreement.

4. All of the conditions applicable to the conversion or continuation of the
Loan requested herein as set forth in the Credit Agreement have been satisfied
or waived as of the date hereof and will remain satisfied or waived to the date
of such Loan.

5. Capitalized terms used herein and not defined herein shall have the meanings
assigned thereto in the Credit Agreement.

[Signature Page Follows]

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

IN WITNESS WHEREOF, the undersigned has executed this Notice of
Conversion/Continuation as of the day and year first above written.

 

BELK, INC., on behalf of itself and the other Borrowers By:  

 

  Name:   Title:

 

[Signature Page to Notice of Conversion/Continuation]

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

EXHIBIT F

FORM OF OFFICER’S COMPLIANCE CERTIFICATE

The undersigned, on behalf of Belk, Inc. (the “Company”), and on behalf of the
Subsidiaries of the Company listed on the signature pages to the Credit
Agreement referred to below (each a “Borrower” and together, the “Borrowers”),
hereby certifies to the Administrative Agent and the Lenders, each as defined in
the Credit Agreement referred to below, as follows:

1. This certificate is delivered to you pursuant to Section 7.2 of the Fourth
Amended and Restated Credit Agreement dated as of October 22, 2014 (as amended,
restated or otherwise modified from time to time, the “Credit Agreement”), by
and among the Borrowers, the lenders party thereto (the “Lenders”) and Wells
Fargo Bank, National Association, as Administrative Agent (the “Administrative
Agent”). Capitalized terms used herein and not defined herein shall have the
meanings assigned thereto in the Credit Agreement.

2. I have reviewed the financial statements of the Borrowers and their
Subsidiaries dated as of             and for the             period[s] then
ended and such statements fairly present in all material respects the financial
condition of the Borrowers and their Subsidiaries as of the dates indicated and
the results of their operations and cash flows for the period[s] indicated.

3. I have reviewed the terms of the Credit Agreement, and the related Loan
Documents and have made, or caused to be made under my supervision, a review in
reasonable detail of the transactions and the condition of the Borrowers and
their Subsidiaries during the accounting period covered by the financial
statements referred to in Paragraph 2 above. Such review has not disclosed the
existence during or at the end of such accounting period of any condition or
event that constitutes a Default or an Event of Default, nor do I have any
knowledge of the existence of any such condition or event as at the date of this
certificate [except, if such condition or event existed or exists, describe the
nature and period of existence thereof and what action the Borrowers have taken,
are taking and propose to take with respect thereto].

4. The Applicable Margin and calculations determining such figure are set forth
on the attached Schedule 1 and the Borrowers and their Subsidiaries are in
compliance with the financial covenants contained in Article IX of the Credit
Agreement as shown on such Schedule 1 and the Borrowers and their Subsidiaries
are in compliance with the other covenants and restrictions contained in the
Credit Agreement.

[Signature Page Follows]

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

WITNESS the following signature as of the day and year first above written.

 

BELK, INC., on behalf of itself and the other Borrowers By:  

 

  Name:   Title:

 

[Signature Page to Officer’s Compliance Certificate]

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

Schedule 1

to

Officer’s Compliance Certificate

[To be provided by Borrowers in form acceptable to Administrative Agent]

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

EXHIBIT G

FORM OF ASSIGNMENT AND ASSUMPTION

This Assignment and Assumption (the “Assignment and Assumption”) is dated as of
the Effective Date set forth below and is entered into by and between
[the][each]1 Assignor identified on the Schedule hereto as “Assignor” or
“Assignors” (collectively, the “Assignors” and each an “Assignor”) and
[the][each]2 Assignee identified on the Schedule hereto as “Assignee” or
“Assignees” (collectively, the “Assignees” and each an “Assignee”). [It is
understood and agreed that the rights and obligations of [the Assignors][the
Assignees]3 hereunder are several and not joint.]4 Capitalized terms used but
not defined herein shall have the meanings given to them in the Credit Agreement
identified below, receipt of a copy of which is hereby acknowledged by
[the][each] 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][each] Assignor hereby irrevocably sells and
assigns to [the Assignee][the respective Assignees], and [the][each] Assignee
hereby irrevocably purchases and assumes from [the Assignor][the respective
Assignors], subject to and in accordance with the Standard Terms and Conditions
and the Credit Agreement, as of the Effective Date inserted by the
Administrative Agent as contemplated below (i) all of [the Assignor’s][the
respective Assignors’] rights and obligations in [its capacity as a
Lender][their respective capacities as Lenders] under the Credit Agreement and
any other documents or instruments delivered pursuant thereto to the extent
related to the amount and percentage interest identified below of all of such
outstanding rights and obligations of [the Assignor][the respective Assignors]
under the respective facilities identified below (including without limitation
any Letters of Credit, guarantees, and Swingline 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)][the respective Assignors (in their respective
capacities as Lenders)] against any Person, whether known or unknown, arising
under or in connection with the Credit Agreement, any other documents or
instruments delivered pursuant thereto or the loan transactions governed thereby
or in any way based on or related to any of the foregoing, including, but not
limited to, contract claims, tort claims, malpractice claims, statutory claims
and all other claims at law or in equity related to the rights and obligations
sold and assigned pursuant to clause (i) above (the rights and obligations sold
and assigned by [the][any] 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][any]
Assignor and, except as expressly provided in this Assignment and Assumption,
without representation or warranty by [the][any] Assignor.

 

1  For bracketed language here and elsewhere in this form relating to the
Assignor(s), if the assignment is from a single Assignor, choose the first
bracketed language. If the assignment is from multiple Assignors, choose the
second bracketed language.

2  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.

3  Select as appropriate.

4  Include bracketed language if there are either multiple Assignors or multiple
Assignees.

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

  1.     Assignor(s):    See Schedule attached hereto           Assignor [is]
[is not] a Defaulting Lender.   2.     Assignee(s):    See Schedule attached
hereto   3.     Borrowers:    Belk, Inc. and Subsidiaries of Belk, Inc. party to
the Credit Agreement   4.     Administrative Agent:    Wells Fargo Bank,
National Association, as the administrative agent under the Credit Agreement  
5.     Credit Agreement:    The Fourth Amended and Restated Credit Agreement
dated as of October 22, 2014 (as amended, restated, supplemented or otherwise
modified from time to time, the “Credit Agreement”) by and among Belk, Inc. and
the Subsidiaries of Belk, Inc. party thereto, as Borrowers, the Lenders parties
thereto, as Lenders, and Wells Fargo Bank, National Association, as
Administrative Agent (as amended, restated, supplemented or otherwise modified)
  6.     Assigned Interest:    See Schedule attached hereto   [7.    Trade Date:
               ]5

[Remainder of Page Intentionally Left Blank]

 

5  To be completed if the Assignor and the Assignee intend that the minimum
assignment amount is to be determined as of the Trade Date.

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

  Effective Date:                , 20            [TO BE INSERTED BY THE
ADMINSTRATIVE AGENT AND WHICH SHALL BE THE EFFECTIVE DATE OF RECORDATION OF
TANSFER IN THE REGISTER THEREFOR.]   The terms set forth in this Assignment and
Assumption are hereby agreed to:

 

ASSIGNOR(S)

See Schedule attached hereto

ASSIGNEE(S)

See Schedule attached hereto

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

SCHEDULE

To Assignment and Assumption

By its execution of this Schedule, each Assignor and each Assignee agrees to the
terms set forth in the attached Assignment and Assumption.

Assigned Interests:

 

Assignor(s)6

   Assignee(s)7    Facility
Assigned8    Aggregate Amount of
Commitment/Loans
for all Lenders9      Amount of
Commitment/
Loans
Assigned9      Percentage
Assigned of
Commitment/
Loans10     CUSIP
Number          $                    $                               %         
   $                    $                               %             $
                   $                               %   

 

ASSIGNEE(S) [INSERT NAME OF ASSIGNEE] [and is an Affiliate/Approved Fund of
[identify Lender]11] By:  

 

  Name:   Title: ASSIGNOR(S) [INSERT NAME OF ASSIGNOR]

By:

 

 

  Name:   Title:

 

6  List each Assignor, as appropriate.

7  List each Assignee, as appropriate.

8  Fill in the appropriate terminology for the types of facilities under the
Credit Agreement that are being assigned under this Assignment (e.g. “Revolving
Credit Commitment,” etc.)

9  Amount to be adjusted by the counterparties to take into account any payments
or prepayments made between the Trade Date and the Effective Date.

10  Set forth, to at least 9 decimals, as a percentage of the Commitment/Loans
of all Lenders thereunder.

11  Select as applicable.

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

[Consented to and]12 Accepted: WELLS FARGO BANK, NATIONAL ASSOCIATION, as
Administrative Agent By:  

 

  Name:   Title: WELLS FARGO BANK, NATIONAL ASSOCIATION, as Swingline Lender and
Issuing Lender By:  

 

  Name:   Title: [Consented to:]13 BELK, INC. on behalf of itself and the other
Borrowers By:  

 

  Name:   Title:

 

12  To be added only if the consent of the Administrative Agent, the Swingline
Lender or any Issuing Lender is required by the terms of the Credit Agreement.
May also use a Master Consent.

13  To be added only if the consent of the Borrowers is required by the terms of
the Credit Agreement. May also use a Master Consent.

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

ANNEX 1

to Assignment and Assumption

STANDARD TERMS AND CONDITIONS FOR

ASSIGNMENT AND ASSUMPTION

1. Representations and Warranties.

1.1 Assignor[s]. [The][Each] Assignor (a) represents and warrants that (i) it is
the legal and beneficial owner of [the][the relevant] Assigned Interest,
(ii) [the][such] 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 (iv) it is [not] a
Defaulting Lender; and (b) assumes no responsibility with respect to (i) any
statements, warranties or representations made in or in connection with the
Credit Agreement or any other Loan Document, (ii) the execution, legality,
validity, enforceability, genuineness, sufficiency or value of the Loan
Documents or any collateral thereunder, (iii) the financial condition of the
Borrowers, any of their Subsidiaries or Affiliates or any other Person obligated
in respect of any Loan Document or (iv) the performance or observance by the
Borrowers, any of their 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 Credit Agreement, (ii) it
meets all the requirements to be an assignee under Section 13.9(b) of the Credit
Agreement (subject to such consents, if any, as may be required therein),
(iii) from and after the Effective Date, it shall be bound by the provisions of
the Credit Agreement as a Lender thereunder and, to the extent of [the][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
Credit Agreement, and has received or has been accorded the opportunity to
receive copies of the most recent financial statements delivered pursuant to
Sections 5.1 or 7.1 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 to
the Assignment and Assumption is any documentation required to be delivered by
it pursuant to the terms of the Credit Agreement, duly completed and executed by
[the][such] Assignee; and (b) agrees that (i) it will, independently and without
reliance on 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][the relevant]
Assignor for amounts which have accrued to but excluding the Effective Date and
to [the][the relevant] Assignee for amounts which have accrued from and after
the Effective Date.

3. General Provisions. This Assignment and Assumption shall be binding upon, and
inure to the benefit of, the parties hereto and their respective successors and
assigns. This Assignment and Assumption may be executed in any number of
counterparts, which together shall constitute one instrument. Delivery of an
executed counterpart of a signature page of this Assignment and Assumption by
telecopy shall be effective as delivery of a manually executed counterpart of
this Assignment and Assumption. This Assignment and Assumption shall be governed
by, and construed in accordance with, the law of the State of North Carolina.

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

SCHEDULE 1.1(a)

Existing Letters of Credit

 

LOC #

   Current
Balance      Issue Date    Expiry
Date   

Beneficiary

LC968-133247    $ 20,000       6/3/2002    6/15/2015    United States Postal
Service SM202485    $ 205,000       3/18/2003    1/31/2015    The Travelers
Indemnity Company SM218346    $ 2,850,000       2/13/2006    1/31/2015    Zurich
American Insurance SM222809    $ 45,000       11/3/2006    11/4/2015    The
Travelers Indemnity Company SM238972    $ 9,875,000       3/29/2011    3/28/2015
   Hartford Fire Insurance Company SM214999    $ 45,000       7/29/2005   
7/26/2015    Utility Dept City of Maryville, TN

Total as of

10/14/2014

   $ 13,040,000            

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

SCHEDULE 1.1(b)

Commitments

 

Lender

   L/C Commitment      Revolving Credit Commitment  

Wells Fargo Bank, National Association

   $ 33,333,333.33       $ 75,000,000.00   

Bank of America, N.A.

   $ 33,333,333.33       $ 75,000,000.00   

Branch Banking & Trust Company

   $ 33,333,333.33       $ 75,000,000.00   

PNC Bank, National Association

   $ 0       $ 60,000,000   

Regions Bank

   $ 0       $ 60,000,000   

U.S. Bank National Association

   $ 0       $ 60,000,000   

JPMorgan Chase Bank, N.A.

   $ 0       $ 30,000,000   

Northern Trust Company

   $ 0       $ 30,000,000   

TD Bank, N.A.

   $ 0       $ 30,000,000   

Mechanics and Farmers Bank

   $ 0       $ 5,000,000   

Total

   $ 100,000,000       $ 500,000,000   

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SCHEDULE 6.1(a)

Jurisdictions of Organization and Qualification

 

CORPORATIONS

   STATE
OF
INC      STATES QUALIFIED IN               AL      AR      DE      FL      GA  
   KY      LA      MD      MO      MS      NC      OK      SC      TN      TX  
   VA      WV  

Belk, Inc.

     DE         x         x         x         x         x         x         x   
     x         x         x         x         x         x         x         x   
     x         x   

Belk Accounts Receivable LLC

     NC                                       x                     

Belk Administration Company

     NC                  x                           x                     

Belk Gift Card Company LLC

     NC                                       x                     

Belk International, Inc.

     NC                                       x                     

Belk-Simpson Company, Greenville, South Carolina

     SC                                             x               

Belk Stores Services, Inc.

     NC                                       x            x               

Belk Stores of Virginia LLC

     NC                                       x                     x      

The Belk Center, Inc.

     NC                                       x                     

Belk Merchandising LLC

     NC                                       x                     

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CORPORATIONS

   STATE
OF
INC      STATES QUALIFIED IN             AL    AR    DE    FL    GA    KY    LA
   MD    MO    MS      NC      OK    SC    TN      TX      VA    WV

Belk Texas Holding LLC

     NC                                       x                     

Belk Department Stores LP

     NC                                    x         x               x         x
        

Belk Ecommerce LLC

     NC                                       x                     

Belk Stores of Mississippi LLC

     MS                                    x                        

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SCHEDULE 6.1(b)

Subsidiaries and Capitalization

 

Corporations

   # Shares
Authorized      Shares
Outstanding      Classes    Par Value      Owned by                Stockholders
   No. Shares
Owned     

Members

Belk, Inc.

     200,000,000         38,343,951       A      0.01       Individuals         
  200,000,000         920,452       B      0.01       Individuals           
20,000,000         0       Preferred      0.01            

Belk-Simpson Company, Greenville, South Carolina

     148,512         35,931       None      100.00       Belk, Inc.      35,931
     

Belk Stores Services, Inc.

     1,000,000         314,404       None      1.00       Belk, Inc.     
314,404      

Belk Administration Company

     1,000         250       None      100.00       Belk Stores
Services, Inc.      250      

Belk Gift Card Company LLC

    
  single member
LLC   
                     Belk, Inc.

The Belk Center, Inc.

    

 
 

a cooperative:

no stock
issued

  

  
  

                 

Belk, Inc.

Belk Stores of Virginia LLC

Belk-Simpson Company, Greenville, South Carolina

Belk Accounts Receivable LLC

Belk International, Inc.

    

 
 

a cooperative:

no stock
issued

  

  
  

                 

Belk, Inc.

Belk Stores of Virginia LLC

Belk-Simpson Company, Greenville, South Carolina

Belk Accounts Receivable LLC

    
  single member
LLC   
                     Belk Stores Services, Inc.

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Corporations

   # Shares
Authorized    Shares
Outstanding    Classes    Par Value    Owned by                Stockholders   
No. Shares
Owned   

Members

Belk Stores of Virginia LLC

   single member
LLC                   Belk Stores Services, Inc.

Belk Texas Holdings LLC

   single member
LLC                   Belk, Inc. Belk, Inc. 1% GP

Belk Department Stores LP

   general partner
limited partner                   Belk Texas Holdings LLC 99% limited partner

Belk Merchandising LLC

   single member
LLC                   Belk International

Belk Ecommerce LLC

   single member
LLC                   Belk, Inc.

Belk Stores of Mississippi LLC

   single member
LLC                   Belk Department Stores LP

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SCHEDULE 6.1(f)

Ongoing Tax Audits

Income Tax

State of North Carolina – fiscal years ending January 2011, 2012, 2013

State of Florida – fiscal years ending January 2011, 2012, 2013

Sales and Use Tax

City of Monroe LA / Ouachita Parish – January 2011 thru December 203

North Carolina – April 2011 thru March 2014

Texas – January 2011 thru April 2014

Unclaimed Property

North Carolina instituted, joined by District of Colombia, Florida, Illinois,
Massachusetts, Michigan, New Jersey, Rhode Island, Tennessee and Virginia – 1997
thru 2011

Property Tax

Belk locations under personal property tax audit as of 10/8/2014

 

Store #

  

Store Name

  

State

    

County

25    Greensboro, NC      NC       Guilford 30    High Point, NC      NC      
Guilford 78    Hartwell, GA      GA       Hart 316    Springfield, TN      TN   
   Robertson 329    Charlotte, NC      NC       Mecklenburg 452    Charlotte, NC
     NC       Mecklenburg 465    Greensboro, NC      NC       Guilford 553   
Pineville, NC      NC       Mecklenburg 598    Henderson, NC      NC       Vance
684    Athens, TN      TN       McMinn 967    Belk Merchandising, LLC      NC   
   Mecklenburg 986    Charlotte, NC - BAC      NC       Mecklenburg 999   
Charlotte, NC Belk Stores Services      NC       Mecklenburg

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SCHEDULE 6.1(i)

ERISA Plans

Employee Pension Benefit Plans:

  1. Belk 401(k) Savings Plan

  2. Belk Pension Plan

Employee Welfare Benefit Plans:

  3. Belk Employees’ Healthcare Plan (Medical & Dental)

  4. Belk Employees’ Group Life Insurance Plan

  5. Belk Employees’ Business Travel Plan

  6. Belk Employees’ Short Term Disability Income Plan

  7. Belk Employees’ Personal Accident Insurance Plan

  8. Belk Employees’ Vision Plan

  9. Belk Employees’ Long Term Disability Income Plan

  10. Belk Employees’ Healthcare Flexible Spending Account

  11. Belk Part Time Employees’ Dental Plan

  12. Belk Part Time Employees’ Vision Plan

  13. Belk Employees’ Dependent Care Flexible Spending Account

  14. Belk Texas Injury Benefit Plan

  15. Belk Employees’ Health Savings Account

 

 

Non-ERISA Employee Benefit Plans:

  16. Belk Deferred Compensation Plans I – V

  17. Belk 401(k) Restoration Plan

  18. Belk, Inc. Pension Restoration Plan

  19. Belk Inc. 2004 Supplemental Executive Retirement Plan – Defined
Contribution

  20. Belk Stores Supplemental Executive Retirement Plan – Defined Benefit

  21. Belk Board of Directors’ Deferred Compensation Plan

  22. Belk Employees’ Long Term Care Insurance Plan

  23. Belk Employees’ Auto and Home Insurance Plan

  24. Belk Employees’ Legal Plan

  25. Belk Employee Assistance Program

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

SCHEDULE 6.1(l)

Material Contracts

Amended and restated Information Technology Services Agreement between Belk
Administration Company and International Business Machines Corporation, dated
September 30, 2014

Credit Card Program Agreement, dated as of November 21, 2005, by and among Belk,
Inc., Belk Stores of Virginia LLC, Belk-Simpson Company, Greenville, South
Carolina, Belk Department Stores LP, Belk Accounts Receivable LLC, Belk Stores
of Mississippi LLC and Synchrony Bank (formally known as GE Money Bank)

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SCHEDULE 6.1(m)

Labor and Collective Bargaining Agreements

None.

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

SCHEDULE 6.1(t)

Existing Debt and Guaranty Obligations

 

   

Items

   Balance  

1.

  Standby Letters of Credit under Credit Facility per schedule 1.1(a)    $
13,040,000   

2.

  Letter of Credit arising under that certain Master Agreement for Letters of
Credit dated January 28, 1998 between Belk International, Inc. and Bank of
America, N.A., no balances outstanding as of October 14, 2014    $ 0   

3.

  Amended and Restated Guaranty dated September 16, 2004 from Belk, Inc. to Bank
of America, N.A. which guarantees up to $45,000,000 for Letters of Credit
arising under that certain Master Agreement for Letters of Credit dated
January 28, 1998 between Belk International, Inc. and Bank of America, N.A.   

4.

  Various guaranty agreements entered into by Belk, Inc. for operating leases of
subsidiaries of Belk, Inc. entered into in the ordinary course of business.   

5.

  Guaranty agreement dated September 30, 2014 by and between Belk, Inc. and
International Business Machines Corporation, which guarantees the obligations of
Belk Administration Company pursuant to that certain Information Technology
Services Agreement dated September 30, 2014 between Belk Administration Company
and International Business Machines Corporation.   

6.

  Senior Notes as follows: $100,000,000 5.31% Senior Notes, Series B, due
July 12, 2015 issued by the Borrows in favor of certain purchases pursuant to
the Note Purchase Agreement dated July 12, 2005 by and among the Borrowers of
such purchases.    $ 100,000,000   

7.

  Senior Notes as follows: $125,000,000 6.20% 2007 Senior Notes, dated
August 31, 2007, due August 31, 2017 issued by Prudential Capital Group.    $
125,000,000   

8.

  Senior Notes as follows: $50,000,000 5.70% 2010 Senior Notes, dated
November 23, 2010, due November 23, 2020, issued by Prudential Capital Group   
$ 50,000,000   

9.

  Senior Notes as follows: $100,000,000 5.21% 2012 Senior Notes, dated
January 25, 2012, due January 25, 2022, issued by the Borrows in favor of
certain purchases pursuant to the Note Purchase Agreement dated January 25, 2012
by and among the Borrowers of such purchases.    $ 100,000,000   

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

10.

  Approximately $36.2 million in capital leases outstanding as of October 14,
2014 incurred in the ordinary course of business, including the Jonesville
Capital Lease listed below    $ 36,200,000   

11.

 

Jonesville Capital Lease - BEL BTS (SC) LLC, as successor-in-interest to 3805
Jonesville, LLC, as landlord, and Belk, Inc., as tenant, are parties to that
certain Lease Agreement dated February 14, 2012, as amended by that certain
First Amendment to Lease Agreement dated May 1, 2012, as further amended by that
certain Second Amendment to Lease Agreement effective June 1, 2013, as further
amended by that certain Third Amendment to Lease Agreement dated June 4, 2014,
as further amended by that certain Fourth Amendment to Lease Agreement dated
October 7, 2014.

  

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

SCHEDULE 6.1(u)

Litigation

None.

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

SCHEDULE 8.3

Insurance

[see attached]

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

SCHEDULE 10.2

Existing Liens

None.

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

SCHEDULE 10.3(b)

Board Approved Investment Policy

[see attached]

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SCHEDULE 10.8

Transactions with Affiliates

None.