Exhibit 10.1

CUSTOMER CUSIP 39322FAA3

FACILITY CUSIP 39322FAB1

 

 

THIRD AMENDED AND RESTATED REVOLVING CREDIT

AND

SECURITY AGREEMENT

 

 

PNC BANK, NATIONAL ASSOCIATION

(AS AGENT)

 

 

PNC BANK, NATIONAL ASSOCIATION

AND THE OTHER FINANCIAL INSTITUTIONS PARTY HERETO

(AS LENDERS)

WITH

 

 

GREEN PLAINS TRADE GROUP LLC

AND

the other Persons joined as borrowers from time to time

(BORROWERS)

 

 

Arranged by:

PNC CAPITAL MARKETS LLC

AND

BANK OF AMERICA, N.A.

(AS JOINT LEAD ARRANGERS AND JOINT BOOKRUNNERS)

BANK OF AMERICA, N.A.

(AS SYNDICATION AGENT)

November 26, 2014

 

 

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TABLE OF CONTENTS

 

              Page   I.           DEFINITIONS      1      1.1.    Accounting
Terms      1      1.2.    General Terms      1      1.3.    Uniform Commercial
Code Terms      32      1.4.    Certain Matters of Construction      32     
1.5.    Existing Indebtedness      33    II.           ADVANCES, PAYMENTS     
33      2.1.    Revolving Advances      33      2.2.    Procedure for Revolving
Advances Borrowing      35      2.3.    Disbursement of Advance Proceeds      37
     2.4.    Swing Loans      37      2.5.    Maximum Advances      38      2.6.
   Repayment of Advances      39      2.7.    Repayment of Excess Advances     
39      2.8.    Statement of Account      39      2.9.    Letters of Credit     
40      2.10.    Issuance of Letters of Credit      40      2.11.   
Requirements For Issuance of Letters of Credit      42      2.12.   
Disbursements, Reimbursement      43      2.13.    Repayment of Participation
Advances      44      2.14.    Documentation      44      2.15.    Determination
to Honor Drawing Request      44      2.16.    Nature of Participation and
Reimbursement Obligations      45      2.17.    Indemnity      46      2.18.   
Liability for Acts and Omissions      46      2.19.    Additional Payments     
48      2.20.    Manner of Borrowing and Payment      48      2.21.    Mandatory
Prepayments      51      2.22.    Use of Proceeds      51      2.23.   
Defaulting Lender      52      2.24.    Increase of the Maximum Loan Amount by
Borrowers      54      2.25.    Decrease of the Maximum Loan Amount by Borrowers
   III.           INTEREST AND FEES.      56      3.1.    Interest      56     
3.2.    Letter of Credit Fees      56      3.3.    Facility Fee and Fee Letter
     57      3.4.    Reserved      57      3.5.    Computation of Interest and
Fees      58      3.6.    Maximum Charges      58      3.7.    Increased Costs
     58      3.8.    Basis For Determining Interest Rate Inadequate or Unfair   
  59   

 

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  3.9.    Capital Adequacy      59      3.10.    Taxes      60      3.11.   
Replacement of Lenders      62    IV.           COLLATERAL: GENERAL TERMS     
62      4.1.    Security Interest in the Collateral      62      4.2.   
Perfection of Security Interest      63      4.3.    Disposition of Collateral
     63      4.4.    Preservation of Collateral      63      4.5.    Ownership
of Collateral      64      4.6.    Defense of Agent’s and Lenders’ Interests   
  64      4.7.    Books and Records      65      4.8.    Financial Disclosure   
  65      4.9.    Compliance with Laws      65      4.10.    Inspection of
Premises      65      4.11.    Insurance      66      4.12.    Failure to Pay
Insurance      67      4.13.    Payment of Taxes      67      4.14.    Payment
of Leasehold Obligations      67      4.15.    Receivables      67      4.16.   
Inventory      70      4.17.    Maintenance of Equipment      70      4.18.   
Exculpation of Liability      70      4.19.    Environmental Matters      70   
  4.20.    Financing Statements      72      4.21.    Real Estate      72     
4.22.    Appraisals      73    V.           REPRESENTATIONS AND WARRANTIES     
73      5.1.    Authority      73      5.2.    Formation and Qualification     
74      5.3.    Survival of Representations and Warranties      74      5.4.   
Tax Returns      74      5.5.    Financial Statements      74      5.6.   
Entity Names      75      5.7.    O.S.H.A. Environmental Compliance; Flood
Insurance      75      5.8.    Solvency; No Litigation, Violation, Indebtedness
or Default; ERISA Compliance      76      5.9.    Patents, Trademarks,
Copyrights and Licenses      77      5.10.    Licenses and Permits      78     
5.11.    Default of Indebtedness      78      5.12.    No Default      78     
5.13.    No Burdensome Restrictions      78      5.14.    No Labor Disputes     
78      5.15.    Margin Regulations      78      5.16.    Investment Company Act
     79      5.17.    Disclosure      79      5.18.    Reserved      79   

 

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  5.19.    Swaps      79      5.20.    Conflicting Agreements      79      5.21.
   Application of Certain Laws and Regulations      79      5.22.    Business
and Property of Borrowers      79      5.23.    Ineligible Securities      79   
  5.24.    Federal Securities Laws      80      5.25.    Equity Interests     
80      5.26.    Material Contracts      80    VI.           AFFIRMATIVE
COVENANTS      80      6.1.    Payment of Fees      80      6.2.    Conduct of
Business and Maintenance of Existence and Assets      80      6.3.    Violations
     81      6.4.    Government Receivables      81      6.5.    Fixed Charge
Coverage Ratio      81      6.6.    Execution of Supplemental Instruments     
81      6.7.    Payment of Indebtedness      81      6.8.    Standards of
Financial Statements      81      6.9.    Federal Securities Laws      81     
6.10.    Change in Management      81      6.11.    Keepwell      82    VII.  
        NEGATIVE COVENANTS      82      7.1.    Merger, Consolidation,
Acquisition and Sale of Assets      82      7.2.    Creation of Liens      82   
  7.3.    Guarantees      82      7.4.    Investments      82      7.5.    Loans
     83      7.6.    Capital Expenditures      83      7.7.    Distributions   
  83      7.8.    Indebtedness      84      7.9.    Nature of Business      84
     7.10.    Transactions with Affiliates      84      7.11.    Leases      84
     7.12.    Subsidiaries      84      7.13.    Fiscal Year and Accounting
Changes      85      7.14.    Pledge of Credit      85      7.15.    Amendment
of Certificate of Formation, Operating Agreement      85      7.16.   
Compliance with ERISA      85      7.17.    Prepayment of Indebtedness      85
     7.18.    Reserved      85      7.19.    Membership/Partnership Interests   
  85      7.20.    Trading with the Enemy Act      86      7.21.    Affiliate
Contracts      86      7.22.    Subordinated Debt      86      7.23.    Other
Agreements      86      7.24.    Unhedged Inventory      86   

 

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VIII.           CONDITIONS PRECEDENT      86      8.1.    Conditions to Initial
Advances      86      8.2.    Conditions to Each Advance      89    IX.  
        INFORMATION AS TO BORROWERS      90      9.1.    Disclosure of Material
Matters      90      9.2.    Schedules      90      9.3.    Environmental
Reports      91      9.4.    Litigation      91      9.5.    Material
Occurrences      91      9.6.    Government Receivables      92      9.7.   
Annual Financial Statements      92      9.8.    Quarterly Financial Statements
     92      9.9.    Monthly Financial Statements      92      9.10.    Other
Reports      93      9.11.    Additional Information      93      9.12.   
Projected Operating Budget      93      9.13.    Variances From Operating Budget
     93      9.14.    Notice of Suits, Adverse Events      93      9.15.   
ERISA Notices and Requests      93      9.16.    Additional Documents      94   
X.           EVENTS OF DEFAULT      94      10.1.    Nonpayment      94     
10.2.    Breach of Representation      94      10.3.    Financial Information   
  94      10.4.    Judicial Actions      95      10.5.    Noncompliance      95
     10.6.    Judgments      95      10.7.    Bankruptcy      95      10.8.   
Inability to Pay      95      10.9.    Subsidiary Bankruptcy      95      10.10.
   Material Adverse Effect      96      10.11.    Lien Priority      96     
10.12.    Guarantor Cross Default      96      10.13.    Cross Default      96
     10.14.    Breach of Guaranty, Guarantor Security Agreement or Pledge
Agreement      96      10.15.    Change of Ownership      96      10.16.   
Invalidity      96      10.17.    Licenses      96      10.18.    Seizures     
96      10.19.    Operations      97      10.20.    Pension Plans      97     
10.21.    Subordinated Loan Default      97      10.22.    Anti-Terrorism Laws
     97      10.23.    Equity Cure Right      97   

 

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XI.           LENDERS’ RIGHTS AND REMEDIES AFTER DEFAULT      98      11.1.   
Rights and Remedies      98      11.2.    Agent’s Discretion      100      11.3.
   Setoff      100      11.4.    Rights and Remedies not Exclusive      100     
11.5.    Allocation of Payments After Event of Default      100    XII.  
        WAIVERS AND JUDICIAL PROCEEDINGS      101      12.1.    Waiver of Notice
     101      12.2.    Delay      101      12.3.    Jury Waiver      102   
XIII.           EFFECTIVE DATE AND TERMINATION      102      13.1.    Term     
102      13.2.    Termination      102    XIV.           REGARDING AGENT     
103      14.1.    Appointment      103      14.2.    Nature of Duties      103
     14.3.    Lack of Reliance on Agent and Resignation      103      14.4.   
Certain Rights of Agent      104      14.5.    Reliance      104      14.6.   
Notice of Default      104      14.7.    Indemnification      105      14.8.   
Agent in its Individual Capacity      105      14.9.    Delivery of Documents   
  105      14.10.    Borrowers’ Undertaking to Agent      105      14.11.    No
Reliance on Agent’s Customer Identification Program      105      14.12.   
Other Agreements      106    XV.           BORROWING AGENCY      106      15.1.
   Borrowing Agency Provisions      106      15.2.    Waiver of Subrogation     
107    XVI.           MISCELLANEOUS      107      16.1.    Governing Law     
107      16.2.    Entire Understanding      108      16.3.    Successors and
Assigns; Participations; New Lenders      111      16.4.    Application of
Payments      114      16.5.    Indemnity      114      16.6.    Notice      115
     16.7.    Survival      117      16.8.    Severability      117      16.9.
   Expenses      117      16.10.    Injunctive Relief      118      16.11.   
Consequential Damages      118      16.12.    Captions      118   

 

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  16.13.    Counterparts; Facsimile Signatures      118      16.14.   
Construction      118      16.15.    Confidentiality; Sharing Information     
118      16.16.    Publicity      119      16.17.    Certifications From Banks
and Participants; USA PATRIOT Act      119      16.18.    Anti-Terrorism Laws   
  119   

 

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LIST OF EXHIBITS AND SCHEDULES

 

Exhibits   Exhibit 1.2   Borrowing Base Certificate Exhibit 1.3   Compliance
Certificate Exhibit 1.4   Form of Subordination Agreement Exhibit 2.1(a)  
Revolving Credit Note Exhibit 2.4(a)   Swing Loan Note Exhibit 2.4(b)   Swing
Loan Request Exhibit 5.5(b)   Financial Projections Exhibit 8.1(k)   Financial
Condition Certificate Exhibit 16.3   Commitment Transfer Supplement Schedules  
Schedule 1.2   Permitted Encumbrances Schedule 4.5   Equipment and Inventory
Locations Schedule 4.15(h)   Deposit and Investment Accounts Schedule 4.19  
Real Property Schedule 5.1   Consents Schedule 5.2(a)   States of Qualification
and Good Standing Schedule 5.2(b)   Subsidiaries Schedule 5.4   Federal Tax
Identification Number Schedule 5.6   Prior Names Schedule 5.7   Environmental
Schedule 5.8(b)   Litigation Schedule 5.8(d)   Plans Schedule 5.9   Intellectual
Property, Source Code Escrow Agreements Schedule 5.10   Licenses and Permits
Schedule 5.14   Labor Disputes Schedule 5.25   Equity Interests Schedule 5.26  
Material Contracts Schedule 7.10   Transactions with Affiliates

 

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THIRD AMENDED AND RESTATED REVOLVING CREDIT

AND

SECURITY AGREEMENT

Third Amended and Restated Revolving Credit and Security Agreement dated as of
November 26, 2014 among GREEN PLAINS TRADE GROUP LLC, a limited liability
company formed under the laws of the State of Delaware (“GPTG”), and each Person
joined as a Borrower from time to time (each a “Borrower”, and collectively
“Borrowers”), the financial institutions which are now or which hereafter become
a party hereto (collectively, the “Lenders” and each individually a “Lender”)
and PNC BANK, NATIONAL ASSOCIATION (“PNC”), as agent for Lenders (PNC, in such
capacity, the “Agent”).

Borrowers, Agent, and the financial institutions party thereto as lenders are
parties to that Second Amended and Restated Revolving Credit and Security
Agreement dated as of April 26, 2013 (as amended or modified from time to time,
the “Existing Agreement”) and certain instruments, documents and agreements
executed in connection therewith (together with the Existing Agreement, the
“Existing Loan Documents”). Borrowers, Agent and Lenders desire to amend and
restate the Existing Agreement in its entirety pursuant to the terms and
conditions hereof.

IN CONSIDERATION of the mutual covenants and undertakings herein contained,
Borrowers, Lenders and Agent hereby agree as follows:

 

I. DEFINITIONS.

1.1. Accounting Terms. As used in this Agreement, the Other Documents or any
certificate, report or other document made or delivered pursuant to this
Agreement, accounting terms not defined in Section 1.2 or elsewhere in this
Agreement and accounting terms partly defined in Section 1.2 to the extent not
defined, shall have the respective meanings given to them under GAAP; provided,
however, whenever such accounting terms are used for the purposes of determining
compliance with financial covenants in this Agreement, such accounting terms
shall be defined in accordance with GAAP as applied in preparation of the
audited financial statements of Borrowers for the fiscal year ended December 31,
2013.

1.2. General Terms. For purposes of this Agreement the following terms shall
have the following meanings:

“Accountants” shall have the meaning set forth in Section 9.7 hereof.

“Advance Rates” shall have the meaning set forth in Section 2.1(a)(y)(iv)
hereof.

“Advances” shall mean and include the Revolving Advances, Letters of Credit and
the Swing Loans, and any portion(s) thereof.

“Affected Lender” shall have the meaning set forth in Section 3.11 hereof.

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“Affiliate” of any Person shall mean (a) any Person which, directly or
indirectly, is in control of, is controlled by, or is under common control with
such Person, or (b) any Person who is a director, member, manager, managing
member, general partner or officer (i) of such Person, (ii) of any Subsidiary of
such Person or (iii) of any Person described in clause (a) above. For purposes
of this definition, control of a Person shall mean the power, direct or
indirect, (x) to vote 5% or more of the Equity Interests having ordinary voting
power for the election of directors of such Person or other Persons performing
similar functions for any such Person, or (y) to direct or cause the direction
of the management and policies of such Person whether by ownership of Equity
Interests, contract or otherwise.

“Affiliate Contracts” shall mean those certain ethanol marketing agreements and
distillers grain marketing agreements by and among each Affiliate Plant and
Borrowers, or any of them, and each agreement individually referred to as an
“Affiliate Contract”.

“Affiliate Plants” shall mean, collectively, Green Plains Bluffton LLC, Green
Plains Obion LLC, Green Plains Shenandoah LLC, Green Plains Superior LLC, Green
Plains Ord LLC, Green Plains Central City LLC, Green Plains Holdings II LLC,
Green Plains Otter Tail LLC and Green Plains Holdings LLC and each individually
referred to as an “Affiliate Plant”.

“Agent” shall have the meaning set forth in the preamble to this Agreement and
shall include its successors and assigns.

“Agreement” shall mean this Third Amended and Restated Revolving Credit and
Security Agreement, as the same may be amended, restated, supplemented or
otherwise modified from time to time.

“Alternate Base Rate” shall mean, for any day, a rate per annum equal to the
highest of (i) the Base Rate in effect on such day, (ii) the sum of the Federal
Funds Open Rate in effect on such day plus one half of one-percent (1/2 of 1%),
and (iii) the sum of the Daily LIBOR Rate in effect on such day plus one percent
(1.0%), so long as a Daily LIBOR Rate is offered, ascertainable and not
unlawful.

“Alternate Source” shall have the meaning set forth in the definition of Federal
Funds Open Rate.

“Anti-Terrorism Laws” shall mean any Laws, including OFAC, relating to
terrorism, trade sanctions programs and embargoes, import/export licensing,
money laundering or bribery, and any regulation, order, or directive
promulgated, issued or enforced pursuant to such Laws, all as amended,
supplemented or replaced from time to time.

“Applicable Law” shall mean all laws, rules, governmental guidelines and
regulations applicable to the Person, conduct, transaction, covenant, Other
Document or contract in question, including all applicable common law and
equitable principles, all provisions of all applicable state, federal and
foreign constitutions, statutes, rules, regulations, treaties, directives and
orders of any Governmental Body, and all orders, judgments and decrees of all
courts and arbitrators.

“Argos Receivable” shall mean and include with respect to each Borrower, each
Receivable of such Borrower arising from the sale of ethanol to a Customer in
tank transfer, with invoice shipping terms as in tank transfer or “ITT.”

 

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“Authority” shall have the meaning set forth in Section 4.19(d).

“Availability Reserve” shall mean $0 as of the Closing Date and through and
including the date immediately prior to the first Adjustment Date (as defined
below), the applicable dollar amount specified below. Effective as of the first
day following receipt by Agent of the quarterly financial statements of
Borrowers on a Consolidated Basis and related Compliance Certificate for the
fiscal quarter ending December 31, 2014 and any fiscal quarter end thereafter
required under 9.8 hereof (such date an “Adjustment Date”), the Availability
Reserve shall be adjusted, if necessary, to the applicable dollar amount set
forth in the table below corresponding to the Fixed Charge Coverage Ratio for
the trailing four quarter period ending on the last day of the most recently
completed fiscal quarter prior to the applicable Adjustment Date:

 

FIXED CHARGE COVERAGE RATIO

   Availability
Reserve  

Less than 1.5 to 1.00

   $ 5,000,000   

Greater than or equal to 1.5 to 1.00

   $ 0   

If the Borrowers shall fail to deliver the financial statements, certificates
and/or other information required under Section 9.8 by the date required
pursuant to such section, the Availability Reserve shall be conclusively
presumed to equal $5,000,000 until the date of delivery of such financial
statements, certificates and/or other information, at which time the
Availability Reserve will be adjusted based upon the Fixed Charge Coverage Ratio
reflected in such statements. Notwithstanding anything to the contrary contained
herein, no downward adjustment from $5,000,000 to $0 shall be made on any
Adjustment Date on which any Event of Default shall have occurred and be
continuing.

“Average Undrawn Availability” shall mean, for any date of determination, the
quotient obtained by dividing (a) the sum of Undrawn Availability for each day
during the 30-day period ending on the day immediately preceding such date of
determination by (b) thirty (30).

“Base Rate” shall mean the base commercial lending rate of PNC as publicly
announced to be in effect from time to time, such rate to be adjusted
automatically, without notice, on the effective date of any change in such rate.
This rate of interest is determined from time to time by PNC as a means of
pricing some loans to its customers and is neither tied to any external rate of
interest or index nor does it necessarily reflect the lowest rate of interest
actually charged by PNC to any particular class or category of customers of PNC.

“Blendstar” shall mean BlendStar, LLC, a Texas limited liability company.

“Blocked Accounts” shall have the meaning set forth in Section 4.15(h).

“Blocked Account Bank” shall have the meaning set forth in Section 4.15(h).

 

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“Borrower” or “Borrowers” shall have the meaning set forth in the preamble to
this Agreement and shall extend to all permitted successors and assigns of such
Persons.

“Borrower Revolver Increase” shall have the meaning set forth in Section 2.24
hereof.

“Borrowers on a Consolidated Basis” shall mean the consolidation in accordance
with GAAP of the accounts or other items of the Borrowers and their respective
Subsidiaries.

“Borrowers’ Account” shall have the meaning set forth in Section 2.8.

“Borrowing Agent” shall mean GPTG.

“Borrowing Base Certificate” shall mean a certificate in substantially the form
of Exhibit 1.2 duly executed by the President, Chief Financial Officer,
Treasurer or Controller of the Borrowing Agent and delivered to the Agent,
appropriately completed, by which such officer shall certify to Agent the
Formula Amount and calculation thereof as of the date of such certificate.

“Business Day” shall mean any day other than Saturday or Sunday or a legal
holiday on which commercial banks are authorized or required by law to be closed
for business in East Brunswick, New Jersey and, if the applicable Business Day
relates to any Eurodollar Rate Loans, such day must also be a day on which
dealings are carried on in the London interbank market.

“Capital Expenditures” shall mean expenditures made or liabilities incurred for
the acquisition of any fixed assets or improvements, replacements, substitutions
or additions thereto which have a useful life of more than one year, including
the total principal portion of Capitalized Lease Obligations, which, in
accordance with GAAP, would be classified as capital expenditures.

“Capitalized Lease Obligation” shall mean any Indebtedness of any Borrower
represented by obligations under a lease that is required to be capitalized for
financial reporting purposes in accordance with GAAP.

“Cash Advance Rate” shall have the meaning set forth in Section 2.1(a)(y)(iv)
hereof.

“Cash Management Liabilities” shall mean any indebtedness, obligations and
liabilities of any Borrower under any agreements or arrangements under which
Agent or any Lender or any Affiliate of Agent or a Lender provides any of the
following products or services to any of the Borrowers: (a) credit cards;
(b) credit card processing services; (c) debit cards and stored value cards;
(d) purchase cards; (e) ACH transactions; (f) cash management and treasury
management services and products, including controlled disbursement accounts or
services, lockboxes, automated clearinghouse transactions, overdrafts,
interstate depository network services; or (g) foreign currency exchange and
foreign currency swaps and hedges. The Cash Management Liabilities shall be
“Obligations” hereunder, guaranteed obligations under the Guaranty and secured
obligations under the Guarantor Security Agreement, and otherwise treated as
Obligations for purposes of each of the Other Documents (other than any
Lender-Provided Interest Rate Hedge). The Liens securing Cash Management
Liabilities shall be pari passu with the Liens securing all other Obligations
under this Agreement and the Other Documents, subject to the express provisions
of Section 11.5.

 

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

“CFTC” shall mean the Commodity Futures Trading Commission.

“CERCLA” shall mean the Comprehensive Environmental Response, Compensation and
Liability Act of 1980, as amended, 42 U.S.C. §§9601 et seq.

“Change in Law” shall mean the occurrence, after the Closing Date, of any of the
following: (a) the adoption or taking effect of any Applicable Law; (b) any
change in any Applicable Law or in the administration, implementation,
interpretation or application thereof by any Governmental Body; or (c) the
making or issuance of any request, rule, guideline or directive (whether or not
having the force of law) by any Governmental Body; provided that notwithstanding
anything herein to the contrary, (x) the Dodd-Frank Wall Street Reform and
Consumer Protection Act and all requests, rules, regulations, guidelines,
interpretations or directives thereunder or issued in connection therewith
(whether or not having the force of Applicable Law) and (y) all requests, rules,
regulations, guidelines, interpretations 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 (whether or not having the force of law), 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, issued, promulgated or implemented.

“CIP Regulations” shall have the meaning set forth in Section 14.12 hereof.

“Claims” shall have the meaning set forth in Section 16.5 hereof.

“Change of Control” shall mean (a) the occurrence of any event (whether in one
or more transactions) which results in a transfer of control of any Borrower to
a Person who is not an Original Owner; (b) any person or group of persons
(within the meaning of Section 13(d) or 14(a) of the Exchange Act) shall have
acquired beneficial ownership (within the meaning of Rule 13d-3 promulgated by
the SEC under the Exchange Act) of 30% or more of the voting Equity Interests of
Holdings; or (c) any merger or consolidation of or with any Borrower or sale of
all or substantially all of the property or assets of any Borrower. For purposes
of this definition, “control of Borrower” shall mean the power, direct or
indirect (x) to vote 50% or more of the Equity Interests having ordinary voting
power for the election of directors (or the individuals performing similar
functions) of any Borrower or (y) to direct or cause the direction of the
management and policies of any Borrower by contract or otherwise.

“Change of Ownership” shall mean (a) 100% of the Equity Interests of any
Borrower is no longer owned or controlled by (including for the purposes of the
calculation of percentage ownership, any Equity Interests into which any Equity
Interests of any Borrower held by any of the Original Owners are convertible or
for which any such Equity Interests of any Borrower or of any other Person may
be exchanged and any Equity Interests issuable to such Original Owners upon
exercise of any warrants, options or similar rights which may at the time of
calculation be held by such Original Owners) a Person who is an Original Owner
or (b) any merger, consolidation or sale of substantially all of the property or
assets of any Borrower.

 

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“Charges” shall mean all taxes, charges, fees, imposts, levies or other
assessments, including all net income, gross income, gross receipts, sales, use,
ad valorem, value added, transfer, franchise, profits, inventory, capital stock,
license, withholding, payroll, employment, social security, unemployment,
excise, severance, stamp, occupation and property taxes, custom duties, fees,
assessments, liens, claims and charges of any kind whatsoever, together with any
interest and any penalties, additions to tax or additional amounts, imposed by
any taxing or other authority, domestic or foreign (including the Pension
Benefit Guaranty Corporation or any environmental agency or superfund), upon the
Collateral, any Borrower or any of its Affiliates.

“Closing Date” shall mean November 26, 2014 or such other date as may be agreed
to by the parties hereto.

“Code” shall mean the Internal Revenue Code of 1986, as the same may be amended
or supplemented from time to time, and any successor statute of similar import,
and the rules and regulations thereunder, as from time to time in effect.

“Collateral” shall mean and include all right, title and interest of each
Borrower in all of the following property and assets of such Borrower, in each
case whether now existing or hereafter arising or created and whether now owned
or hereafter acquired and wherever located:

(a) all Receivables;

(b) all Equipment;

(c) all General Intangibles;

(d) all Inventory;

(e) all Investment Property;

(f) all Subsidiary Stock;

(g) (i) all goods and other property including, but not limited to, all
merchandise returned or rejected by Customers, relating to or securing any of
the Receivables; (ii) all rights as a consignor, a consignee, an unpaid vendor,
mechanic, artisan, or other lienor, including stoppage in transit, setoff,
detinue, replevin, reclamation and repurchase; (iii) all additional amounts due
from any Customer relating to the Receivables; (iv) all other property,
including warranty claims, relating to any goods securing the Obligations;
(v) all contract rights, rights of payment which have been earned under a
contract right, instruments (including promissory notes), documents, chattel
paper (including electronic chattel paper), warehouse receipts, deposit
accounts, letters of credit and money; (vi) all commercial tort claims (whether
now existing or hereafter arising); (vii) if and when obtained by any Borrower,
all real and personal property of third parties in which such Borrower has been
granted a lien or security interest as security for the payment or enforcement
of Receivables; (viii) all letter of credit rights (whether or not the
respective letter of credit is evidenced by a writing); (ix) all supporting
obligations; and (x) any other goods, personal property or real property now
owned or hereafter

 

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acquired in which any Borrower has expressly granted a security interest or may
in the future grant a security interest to Agent hereunder, or in any amendment
or supplement hereto or thereto, or under any other agreement between Agent and
any Borrower;

(h) all of each Borrower’s ledger sheets, ledger cards, files, correspondence,
records, books of account, business papers, computers, computer software (owned
by any Borrower or in which it has an interest), computer programs, tapes, disks
and documents relating to (a), (b), (c), (d), (e), (f) or (g) of this paragraph;
and

(i) all proceeds and products of (a), (b), (c), (d), (e), (f), (g), and (h) in
whatever form, including, but not limited to: cash, deposit accounts (whether or
not comprised solely of proceeds), certificates of deposit, insurance proceeds
(including hazard, flood and credit insurance), negotiable instruments and other
instruments for the payment of money, chattel paper, security agreements,
documents, eminent domain proceeds, condemnation proceeds and tort claim
proceeds.

“Commitment Transfer Supplement” shall mean a document in the form of Exhibit
16.3 hereto, properly completed and otherwise in form and substance satisfactory
to Agent by which the Purchasing Lender purchases and assumes a portion of the
obligation of Lenders to make Advances under this Agreement.

“Compliance Certificate” shall mean a compliance certificate, in the form of
Exhibit 1.3 attached hereto, to be signed by the Chief Financial Officer,
Treasurer or Controller of Borrowing Agent, which shall state that, based on an
examination sufficient to permit such officer to make an informed statement, no
Default or Event of Default exists, or if such is not the case, specifying such
Default or Event of Default, its nature, when it occurred, whether it is
continuing and the steps being taken by Borrowers with respect to such default
and, such certificate shall have appended thereto calculations which set forth
Borrowers’ compliance with the requirements or restrictions imposed by Sections
6.5, 7.4, 7.5, 7.6, 7.7, 7.8, 7.11 and 7.24.

“Consents” shall mean all filings and all licenses, permits, consents,
approvals, authorizations, qualifications and orders of Governmental Bodies and
other third parties, domestic or foreign, necessary to carry on any Borrower’s
business or necessary (including to avoid a conflict or breach under any
agreement, instrument, other document, license, permit or other authorization)
for the execution, delivery or performance of this Agreement, the Other
Documents or the Subordinated Loan Documentation, including any Consents
required under all applicable federal, state or other Applicable Law.

“Consigned Inventory” shall mean Inventory of any Borrower that is in the
possession of another Person on a consignment, sale or return, or other basis
that does not constitute a final sale and acceptance of such Inventory.

“Contract Rate” shall have the meaning set forth in Section 3.1 hereof.

“Controlled Group” shall mean, at any time, each Borrower and all members of a
controlled group of corporations and all trades or businesses (whether or not
incorporated) under common control and all other entities which, together with
any Borrower, are treated as a single employer under Section 414 of the Code.

 

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“Covered Entity” shall mean (a) each Borrower, each of Borrower’s Subsidiaries,
all Guarantors and all pledgors of Collateral and (b) each Person that, directly
or indirectly, is in control of a Person described in clause (a) above. For
purposes of this definition, control of a Person shall mean the direct or
indirect (x) ownership of, or power to vote, 25% or more of the issued and
outstanding equity interests having ordinary voting power for the election of
directors of such Person or other Persons performing similar functions for such
Person, or (y) power to direct or cause the direction of the management and
policies of such Person whether by ownership of equity interests, contract or
otherwise.

“Customer” shall mean and include the account debtor with respect to any
Receivable and/or the prospective purchaser of goods, services or both with
respect to any contract or contract right, and/or any party who enters into or
proposes to enter into any contract or other arrangement with any Borrower,
pursuant to which such Borrower is to deliver any personal property or perform
any services.

“Customs” shall have the meaning set forth in Section 2.11(b) hereof.

“Daily LIBOR Rate” shall mean, for any day, the rate per annum determined by the
Agent by dividing (x) the Published Rate by (y) a number equal to 1.00 minus the
Reserve Percentage.

“Debt Payments” shall mean and include (a) all cash actually expended by any
Borrower to make interest payments on any Advances hereunder, plus (b) accrued
but unpaid interest on account of Eurodollar Rate Loans, plus (c) all cash
actually expended by any Borrower to make payments for all fees, commissions and
charges set forth herein and with respect to any Advances, plus (d) all cash
actually expended by any Borrower to make payments on Capitalized Lease
Obligations, plus (e) all cash actually expended by any Borrower to make
payments with respect to any other Indebtedness for borrowed money.

“Default” shall mean an event, circumstance or condition which, with the giving
of notice or passage of time or both, would constitute an Event of Default.

“Default Rate” shall have the meaning set forth in Section 3.1 hereof.

“Defaulting Lender” shall mean any Lender that: (a) has failed, within two
Business Days of the date required to be funded or paid, to (i) fund any portion
of its Revolving Commitment Percentage of Advances, (ii) if applicable, fund any
portion of its Participation Commitment in Letters of Credit or (iii) pay over
to the Agent, the Issuer, or any Lender any other amount required to be paid by
it hereunder, unless, in the case of clause (i) above, such Lender notifies the
Agent in writing that such failure is the result of such Lender’s good faith
determination that a condition precedent to funding (specifically identified and
including a particular Default or Event of Default, if any) has not been
satisfied; (b) has notified the Borrowers or the Agent in writing, or has made a
public statement to the effect, that it does not intend or expect to comply with
any of its funding obligations under this Agreement (unless such writing or
public statement indicates that such position is based on such Lender’s good
faith determination that a condition precedent (specifically identified and
including a particular Default or Event of Default, if any) to funding a loan
under this Agreement cannot be satisfied) or generally under other agreements

 

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in which it commits to extend credit; (c) has failed, within two Business Days
after request by the Agent, acting in good faith, to provide a certification in
writing from an authorized officer of such Lender that it will comply with its
obligations (and is financially able to meet such obligations) to fund
prospective Advances and, if applicable, participations in then outstanding
Letters of Credit under this Agreement, provided that such Lender shall cease to
be a Defaulting Lender pursuant to this clause (c) upon the Agent’s receipt of
such certification in form and substance satisfactory to the Agent; (d) has
become the subject of an Insolvency Event; or (e) has failed at any time to
comply with the provisions of Section 2.20(d) with respect to purchasing
participations from the other Lenders, whereby such Lender’s share of any
payment received, whether by setoff or otherwise, is in excess of its pro rata
share of such payments due and payable to all of the Lenders.

“Depository Accounts” shall have the meaning set forth in Section 4.15(h)
hereof.

“Documents” shall have the meaning set forth in Section 8.1(c) hereof.

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

“Domestic Rate Loan” shall mean any Advance that bears interest based upon the
Alternate Base Rate.

“Drawing Date” shall have the meaning set forth in Section 2.12(b) hereof.

“Earnings Before Interest and Taxes” shall mean for any period the sum of
(i) net income (or loss) of Borrowers on a Consolidated Basis for such period
(excluding extraordinary gains and losses), plus (ii) all interest expense of
Borrowers on a Consolidated Basis for such period, plus (iii) all charges
against income of Borrowers on a Consolidated Basis for such period for federal,
state and local taxes.

“EBITDA” shall mean for any period the sum of (i) Earnings Before Interest and
Taxes for such period plus (ii) depreciation expenses of Borrowers on a
Consolidated Basis for such period, plus (iii) amortization expenses of
Borrowers on a Consolidated Basis for such period.

“EBITDA Shortfall Amount” shall have the meaning set forth in Section 10.23
hereof.

“Effective Date” means the date indicated in a document or agreement to be the
date on which such document or agreement becomes effective, or, if there is no
such indication, the date of execution of such document or agreement.

“Eligibility Date” shall mean, with respect to each Borrower and Guarantor and
each Swap, the date on which this Agreement or any Other Document becomes
effective with respect to such Swap (for the avoidance of doubt, the Eligibility
Date shall be the Effective Date of such Swap if this Agreement or any Other
Document is then in effect with respect to such Borrower or Guarantor, and
otherwise it shall be the Effective Date of this Agreement and/or such Other
Document(s) to which such Borrower or Guarantor is a party).

“Eligible Contract Participant” shall mean an “eligible contract participant” as
defined in the CEA and regulations thereunder.

 

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“Eligible Insured Foreign Receivable or Receivables” shall mean Receivables that
meet the requirements of Eligible Receivables, except clauses (b) and (f) of
such definition; provided that such Receivables are (i) credit insured (the
insurance carrier, amount and terms of such insurance shall be reasonably
acceptable to Agent and shall name Agent as beneficiary or loss payee, as
applicable) or backed by a letter of credit reasonably acceptable to Agent and
(ii) not due or unpaid more than ten (10) days after the original due date or
forty five (45) days after the original invoice date.

“Eligible In-Tank Inventory” shall mean Inventory consisting of finished goods
ethanol that would be Eligible Inventory but for the fact that it is situated at
a location not owned by a Borrower, but only if (a) such Inventory has passed
through the “inlet flange” at the Affiliate Plant into a storage tank located at
the Affiliate Plant, (b) Agent shall have received executed amended Affiliate
Contracts which shall have been modified to reflect that title to the ethanol
passes to GPTG at the inlet flange (meaning at the point where finished good
ethanol flows into the storage tanks) and (c) Agent has received Lien
Waiver/Inventory Acknowledgments from the applicable Affiliate Plant and any
lender to the applicable Affiliate Plant. For the avoidance of doubt, Eligible
In-Tank Inventory shall not include any Inventory located in a Blendstar or any
third party storage tank whether or not Agent has a Lien Waiver/Inventory
Acknowledgements for such location.

“Eligible In-Transit Inventory” shall mean finished goods Inventory (other than
Off-load Inventory) that would be Eligible Inventory but for the fact that it is
in-transit Inventory, but only if: (a) such in-transit Inventory is the subject
of documentation acceptable to Agent including a non-negotiable bill of lading
that designates a Borrower or Agent as the consignee; (b) Agent is satisfied
that title remains with Borrowers throughout the shipping process; and (c) such
in-transit Inventory is fully insured by appropriate insurance, in such amounts,
with such insurance companies and subject to such deductibles as are
satisfactory to Agent and in respect of which Agent has been named as lender
loss payee. For the avoidance of doubt, Eligible In-Transit Inventory shall no
longer be Eligible In-Transit Inventory once any such Inventory destined for
Blendstar or any third party storage facility is loaded into Blendstar’s or any
such third party storage facility’s storage tanks.

“Eligible Inventory” shall mean and include Inventory consisting of finished
goods ethanol, corn oil, dried distillers grain and natural gas with respect to
each Borrower, valued on a mark-to-market basis (based on a market source
acceptable to Agent), which Agent, in its Permitted Discretion, shall not deem
ineligible Inventory, based on such considerations as Agent may from time to
time deem appropriate including whether the Inventory is subject to a perfected,
first priority security interest in favor of Agent and no other Lien (other than
a Permitted Encumbrance). In addition, Inventory shall not be Eligible Inventory
if it: (a) does not conform to all applicable standards imposed by any
Governmental Body which has regulatory authority over such goods or the use or
sale thereof; (b) is in transit; (c) is located outside the continental United
States or Canada or at a location that is not otherwise in compliance with this
Agreement; (d) constitutes Consigned Inventory; (e) is the subject of an
Intellectual Property Claim which is reasonably likely to prohibit such Borrower
from selling such Inventory in the Ordinary Course of Business or Agent from
selling such Inventory in the exercise of its remedies hereunder; (f) is subject
to a License Agreement or other agreement that limits, conditions or restricts
such Borrower’s or Agent’s right to sell or otherwise dispose of such Inventory,
unless

 

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Agent is a party to a Licensor/Agent Agreement with the Licensor under such
License Agreement or Agent has established reserves in an amount determined
necessary by Agent in its Permitted Discretion and Agent is otherwise satisfied
that it may sell or otherwise dispose of such Inventory without (i) infringing
the rights of such Licensor, (ii) violating any contract with such Licensor, or
(iii) incurring any liability with respect to payment of royalties other than
royalties incurred pursuant to sale of such Inventory under the current License
Agreement or such other License Agreements as are approved by the Agent in its
Permitted Discretion; (g) is situated at a location not owned by a Borrower; or
(h) if the sale of such Inventory would result in an ineligible Receivable.

“Eligible Off-load Receivables” shall mean and include with respect to each
Borrower, each Off-load Receivable that would be an Eligible Receivable but for
the fact that the goods giving rise to such Off-load Receivable have not been
delivered to and accepted by the Customer.

“Eligible On-Track Inventory” shall mean Inventory consisting of finished goods
ethanol, corn oil and dried distillers grain that would be Eligible Inventory
but for the fact that it is situated at a location not owned by a Borrower which
has been loaded into rail cars or tanker trucks ready for shipment (but which
have not yet been picked up by a common carrier for transport) at (i) an
Affiliate Plant, but only if Agent has received Lien Waiver/Inventory
Acknowledgments from the applicable Affiliate Plant and any lender to the
applicable Affiliate Plant or (ii) a third party plant which GPTG has a third
party marketing agreement with which is in form and substance substantially
similar to the Affiliate Contracts, but only if Agent has received Lien
Waiver/Inventory Acknowledgments from the applicable third party plant owner.

“Eligible Receivables” shall mean and include with respect to each Borrower,
each Receivable of such Borrower arising in the Ordinary Course of Business and
which Agent, in its Permitted Discretion, shall deem to be an Eligible
Receivable. A Receivable shall not be deemed eligible unless such Receivable is
subject to Agent’s first priority perfected security interest and no other Lien
(other than Permitted Encumbrances), and is evidenced by an invoice or other
documentary evidence satisfactory to Agent. In addition, no Receivable shall be
an Eligible Receivable if:

(a) it arises out of a sale made by any Borrower to an Affiliate of any Borrower
or to a Person controlled by an Affiliate of any Borrower;

(b) it is due or unpaid more than ten (10) days after the original due date or
thirty five (35) days after the original invoice date;

(c) fifty percent (50%) or more of the Receivables from such Customer are not
deemed Eligible Receivables hereunder;

(d) any covenant, representation or warranty contained in this Agreement with
respect to such Receivable has been breached;

(e) the Customer shall (i) apply for, suffer, or consent to the appointment of,
or the taking of possession by, a receiver, custodian, trustee or liquidator of
itself or of all or a substantial part of its property or call a meeting of its
creditors, (ii) admit in writing its inability,

 

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or be generally unable, to pay its debts as they become due or cease operations
of its present business, (iii) make a general assignment for the benefit of
creditors, (iv) commence a voluntary case under any state or federal bankruptcy
laws (as now or hereafter in effect), (v) be adjudicated a bankrupt or
insolvent, (vi) file a petition seeking to take advantage of any other law
providing for the relief of debtors, (vii) acquiesce to, or fail to have
dismissed, any petition which is filed against it in any involuntary case under
such bankruptcy laws, or (viii) take any action for the purpose of effecting any
of the foregoing;

(f) the sale is to a Customer outside the continental United States of America
or Canada (other than Quebec), unless the sale is on letter of credit, guaranty
or acceptance terms, in each case acceptable to Agent in its sole discretion;

(g) the sale to the Customer is on a bill-and-hold, guaranteed sale,
sale-and-return, sale on approval, consignment or any other repurchase or return
basis or is evidenced by chattel paper, an instrument or a judgment;

(h) Agent believes, in its Permitted Discretion, that collection of such
Receivable is insecure or that such Receivable may not be paid by reason of the
Customer’s financial inability to pay;

(i) the Customer is the United States of America, any state or any department,
agency or instrumentality of any of them, unless the applicable Borrower assigns
its right to payment of such Receivable to Agent pursuant to the Assignment of
Claims Act of 1940, as amended (31 U.S.C. Sub-Section 3727 et seq. and 41 U.S.C.
Sub-Section 15 et seq.) and has otherwise complied with other applicable
statutes or ordinances;

(j) the goods giving rise to such Receivable have not been delivered to and
accepted by the Customer or the services giving rise to such Receivable have not
been performed by the applicable Borrower and accepted by the Customer or the
Receivable otherwise does not represent a final sale;

(k) the Receivables of the Customer exceed a credit limit determined by Agent,
in its Permitted Discretion, to the extent such Receivable exceeds such limit;

(l) the Receivable is subject to any offset, deduction, defense, dispute, or
counterclaim against any obligation of any Borrower or any Affiliate Plant (but
such Receivable shall only be ineligible to the extent of such offset,
deduction, defense or counterclaim), the Customer is also a creditor or supplier
of a Borrower or any Affiliate Plant or the Receivable is contingent in any
respect or for any reason;

(m) the applicable Borrower has made any agreement with any Customer for any
deduction therefrom, except for discounts or allowances made in the Ordinary
Course of Business for prompt payment, all of which discounts or allowances are
reflected in the calculation of the face value of each respective invoice
related thereto;

(n) any return, rejection or repossession of the merchandise has occurred or the
rendition of services has been disputed;

 

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(o) such Receivable is not payable to a Borrower;

(p) such Receivables is an Argos Receivable;

(q) such Receivable is not unconditionally payable in U.S. Dollars or Canadian
Dollars;

(r) twenty-five percent (25%) or more of the Eligible Receivables are owing from
such Customer;

(s) the Account Debtor with respect to such Receivable is subject to Sanctions
or is on any specially designated national list maintained by OFAC; or

(t) such Receivable is not otherwise satisfactory to Agent in its Permitted
Discretion.

“Eligible Stored Natural Gas Inventory” shall mean Inventory consisting of
finished goods natural gas that would be Eligible Inventory but for the fact
that it is situated at a location not owned by a Borrower, but only if Agent has
received a consent to the assignment of the applicable storage agreement from
the applicable storage facility, in form and substance reasonably satisfactory
to Agent.

“Eligible Un-Insured Foreign Receivable or Receivables” shall mean Receivables
that meet the requirements of Eligible Receivables, except clauses (b) and
(f) of such definition; provided that: (i) such Receivables are not due or
unpaid more than ten (10) days after the original due date or forty five
(45) days after the original invoice date, (ii) the Customer is located in a
country that has signed the Convention on the Organisation for Economic
Co-operation and Development, (iii) such Receivable is payable in U.S. Dollars
and (iv) such Receivable is otherwise satisfactory to Agent in its Permitted
Discretion.

“Environmental Complaint” shall have the meaning set forth in Section 4.19(d)
hereof.

“Environmental Laws” shall mean all federal, state and local environmental, land
use, zoning, health, chemical use, safety and sanitation laws, statutes,
ordinances and codes as well as common laws, relating to the protection of the
environment, human health and/or governing the use, storage, treatment,
generation, transportation, processing, handling, production or disposal of
Hazardous Substances and the rules, regulations, policies, guidelines,
interpretations, decisions, orders and directives of federal, state,
international and local governmental agencies and authorities with respect
thereto.

“Equipment” shall mean and include as to each Borrower all of such Borrower’s
goods (other than Inventory) whether now owned or hereafter acquired and
wherever located including all equipment, machinery, apparatus, motor vehicles,
fittings, furniture, furnishings, fixtures, parts, accessories and all
replacements and substitutions therefor or accessions thereto.

“Equity Cure” shall have the meaning set forth in Section 10.23 hereof.

“Equity Interests” shall mean, with respect to any Person, any and all shares,
rights to

 

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purchase, options, warrants, general, limited or limited liability partnership
interests, member interests, participation or other equivalents of or interest
in (regardless of how designated) equity of such Person, whether voting or
nonvoting, including common stock, preferred stock, convertible securities or
any other “equity security” (as such term is defined in Rule 3a11-1 of the
General Rules and Regulations promulgated by the SEC under the Exchange Act),
including in each case, without limitation, all of the following rights relating
to such Equity Interests, whether arising under the Organizational Documents of
the Person issuing such Equity Interests (the “issuer”) or under the applicable
laws of such issuer’s jurisdiction of organization relating to the formation,
existence and governance of corporations, limited liability companies or
partnerships or business trusts or other legal entities, as the case may be:
(i) all economic rights (including all rights to receive dividends and
distributions) relating to such Equity Interests; (ii) all voting rights and
rights to consent to any particular action(s) by the applicable issuer;
(iii) all management rights with respect to such issuer; (iv) in the case of any
Equity Interests consisting of a general partner interest in a partnership, all
powers and rights as a general partner with respect to the management,
operations and control of the business and affairs of the applicable issuer;
(v) in the case of any Equity Interests consisting of the membership/limited
liability company interests of a managing member in a limited liability company,
all powers and rights as a managing member with respect to the management,
operations and control of the business and affairs of the applicable issuer;
(vi) all rights to designate or appoint or vote for or remove any officers,
directors, manager(s), general partner(s) or managing member(s) of such issuer
and/or any members of any board of members/managers/partners/directors that may
at any time have any rights to manage and direct the business and affairs of the
applicable issuer under its Organizational Documents as in effect from time to
time or under Applicable Law; (vii) all rights to amend the Organizational
Documents of such issuer, (viii) in the case of any Equity Interests in a
partnership or limited liability company, the status of the holder of such
Equity Interests as a “partner”, general or limited, or “member” (as applicable)
under the applicable Organizational Documents and/or Applicable Law; and
(ix) all certificates evidencing such Equity Interests.

“ERISA” shall mean the Employee Retirement Income Security Act of 1974, as
amended from time to time and the rules and regulations promulgated thereunder.

“Eurodollar Alternate Source” shall have the meaning given in the definition of
“Eurodollar Rate.”

“Eurodollar Rate” shall mean for any Eurodollar Rate Loan for the then current
Interest Period relating thereto, the interest rate per annum determined by
Agent by dividing (the resulting quotient rounded upwards, if necessary, to the
nearest 1/100th of 1% per annum) (a) the rate which appears on the Bloomberg
Page BBAM1 (or on such other substitute Bloomberg page that displays rates at
which U.S. dollar deposits are offered by leading banks in the London interbank
deposit market), or the rate which is quoted by another source selected by Agent
as an authorized information vendor for the purpose of displaying rates at which
U.S. dollar deposits are offered by leading banks in the London interbank
deposit market (a “Eurodollar Alternate Source”), at approximately 11:00 a.m.,
London time, two (2) Business Days prior to the commencement of such Interest
Period as the London interbank offered rate for U.S. Dollars for an amount
comparable to such Eurodollar Rate Loan and having a borrowing date and a
maturity comparable to such Interest Period (or if there shall at any time, for
any reason, no longer exist a Bloomberg Page BBAM1 (or any substitute page) or
any Eurodollar Alternate Source, a comparable replacement rate determined by
Agent at such time (which determination shall be conclusive absent manifest
error)), by (b) a number equal to 1.00 minus the Reserve Percentage.

 

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The Eurodollar Rate shall be adjusted with respect to any Eurodollar Rate Loan
that is outstanding on the effective date of any change in the Reserve
Percentage as of such effective date. Agent shall give reasonably prompt notice
to the Borrowing Agent of the Eurodollar Rate as determined or adjusted in
accordance herewith, which determination shall be conclusive absent manifest
error.

“Eurodollar Rate Loan” shall mean an Advance at any time that bears interest
based on the Eurodollar Rate.

“Event of Default” shall have the meaning set forth in Article X hereof.

“Exchange Act” shall mean the Securities Exchange Act of 1934, as amended.

“Excluded Hedge Liability or Liabilities” shall mean, with respect to each
Borrower and Guarantor, each of its Swap Obligations if, and only to the extent
that, all or any portion of this Agreement or any Other Document that relates to
such Swap Obligation is or becomes illegal under the CEA, or any rule,
regulation or order of the CFTC, solely by virtue of such Borrower’s and/or
Guarantor’s failure to qualify as an Eligible Contract Participant on the
Eligibility Date for such Swap. Notwithstanding anything to the contrary
contained in the foregoing or in any other provision of this Agreement or any
Other Document, the foregoing is subject to the following provisos: (a) if a
Swap Obligation arises under a master agreement governing more than one Swap,
this definition shall apply only to the portion of such Swap Obligation that is
attributable to Swaps for which such guaranty or security interest is or becomes
illegal under the CEA, or any rule, regulations or order of the CFTC, solely as
a result of the failure by such Borrower or Guarantor for any reason to qualify
as an Eligible Contract Participant on the Eligibility Date for such Swap;
(b) if a guarantee of a Swap Obligation would cause such obligation to be an
Excluded Hedge Liability but the grant of a security interest would not cause
such obligation to be an Excluded Hedge Liability, such Swap Obligation shall
constitute an Excluded Hedge Liability for purposes of the guaranty but not for
purposes of the grant of the security interest; and (c) if there is more than
one Borrower or Guarantor executing this Agreement or the Other Documents and a
Swap Obligation would be an Excluded Hedge Liability with respect to one or more
of such Persons, but not all of them, the definition of Excluded Hedge Liability
or Liabilities with respect to each such Person shall only be deemed applicable
to (i) the particular Swap Obligations that constitute Excluded Hedge
Liabilities with respect to such Person, and (ii) the particular Person with
respect to which such Swap Obligations constitute Excluded Hedge Liabilities.

“Excluded Taxes” shall mean, with respect to Agent, any Lender, Participant,
Swing Loan Lender, Issuer or any other recipient of any payment to be made by or
on account of any Obligations, (a) taxes imposed on or measured by its overall
net income (however denominated), and franchise taxes imposed on it (in lieu of
net income taxes), by the jurisdiction (or any political subdivision thereof)
under the laws of which such recipient is organized or in which its principal
office or applicable lending office is located or, in the case of any Lender,
Participant, Swing Loan Lender or Issuer, in which its applicable lending office
is located, (b) any branch

 

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profits taxes imposed by the United States of America or any similar tax imposed
by any other jurisdiction in which any Borrower is located, (c) in the case of a
Foreign Lender, any withholding tax that is imposed on amounts payable to such
Foreign Lender at the time such Foreign Lender becomes a party hereto (or
designates a new lending office) or is attributable to such Foreign Lender’s
failure or inability (other than as a result of a Change in Law) to comply with
Section 3.10(e), except to the extent that such Foreign Lender or Participant
(or its assignor or seller of a participation, if any) was entitled, at the time
of designation of a new lending office (or assignment or sale of a
participation), to receive additional amounts from Borrowers with respect to
such withholding tax pursuant to Section 3.10(a), or (d) any Taxes imposed on
any “withholding payment” payable to such recipient as a result of the failure
of such recipient to satisfy the requirements set forth in the FATCA after
December 31, 2012.

“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) and any current or
future regulations thereunder or official interpretations thereof.

“Federal Funds Effective Rate” for any day shall mean the rate per annum (based
on a year of 360 days and actual days elapsed and rounded upward to the nearest
1/100 of 1%) announced by the Federal Reserve Bank of New York (or any
successor) on such day as being the weighted average of the rates on overnight
federal funds transactions arranged by federal funds brokers on the previous
trading day, as computed and announced by such Federal Reserve Bank (or any
successor) in substantially the same manner as such Federal Reserve Bank
computes and announces the weighted average it refers to as the “Federal Funds
Effective Rate” as of the date of this Agreement; provided, if such Federal
Reserve Bank (or its successor) does not announce such rate on any day, the
“Federal Funds Effective Rate” for such day shall be the Federal Funds Effective
Rate for the last day on which such rate was announced.

“Federal Funds Open Rate” for any day shall mean the rate per annum (based on a
year of 360 days and actual days elapsed) which is the daily federal funds open
rate as quoted by ICAP North America, Inc. (or any successor) as set forth on
the Bloomberg Screen BTMM for that day opposite the caption “OPEN” (or on such
other substitute Bloomberg Screen that displays such rate), or as set forth on
such other recognized electronic source used for the purpose of displaying such
rate as selected by PNC (an “Alternate Source”) (or if such rate for such day
does not appear on the Bloomberg Screen BTMM (or any substitute screen) or on
any Alternate Source, or if there shall at any time, for any reason, no longer
exist a Bloomberg Screen BTMM (or any substitute screen) or any Alternate
Source, a comparable replacement rate determined by the PNC at such time (which
determination shall be conclusive absent manifest error); provided however, that
if such day is not a Business Day, the Federal Funds Open Rate for such day
shall be the “open” rate on the immediately preceding Business Day. If and when
the Federal Funds Open Rate changes, the rate of interest with respect to any
advance to which the Federal Funds Open Rate applies will change automatically
without notice to the Borrowers, effective on the date of any such change.

“Fee Letter” shall mean the fee letter dated as of even date herewith among
Borrowers and PNC.

 

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“Financial Covenant Default” shall have the meaning set forth in Section 10.23
hereof.

“Fixed Charge Coverage Ratio” shall mean and include, with respect to any fiscal
period, the ratio of (a) EBITDA, minus Unfunded Capital Expenditures made during
such period, minus distributions (including tax distributions) and dividends
permitted pursuant to Section 7.7 made during such period, minus cash taxes paid
during such period to (b) all Debt Payments made during such period.

“Flood Laws” shall mean all Applicable Laws relating to policies and procedures
that address requirements placed on federally regulated lenders under the
National Flood Insurance Reform Act of 1994 and other Applicable Laws related
thereto.

“Foreign Currency Hedge Liabilities” shall have the meaning given in the
definition of “Lender-Provided Foreign Currency Hedge.”

“Foreign Lender” shall mean any Lender that is organized under the laws of a
jurisdiction other than that in which Borrowers are resident for tax purposes.
For purposes of this definition, the United States of America, each State
thereof and the District of Columbia shall be deemed to constitute a single
jurisdiction.

“Foreign Subsidiary” of any Person, shall mean any Subsidiary of such Person
that is not organized or incorporated in the United States or any State or
territory thereof.

“Formula Amount” shall have the meaning set forth in Section 2.1(a) hereof.

“Fuel Taxes” shall mean all taxes, assessments and other Charges lawfully levied
or assessed upon any Borrower with respect to the sale, marketing, distribution
and/or any other action taken with respect to ethanol by such Borrower.

“GAAP” shall mean generally accepted accounting principles in the United States
of America in effect from time to time.

“General Intangibles” shall mean and include as to each Borrower all of such
Borrower’s general intangibles, whether now owned or hereafter acquired,
including all payment intangibles, all choses in action, causes of action,
corporate or other business records, inventions, designs, patents, patent
applications, equipment formulations, manufacturing procedures, quality control
procedures, trademarks, trademark applications, service marks, trade secrets,
goodwill, copyrights, design rights, software, computer information, source
codes, codes, records and updates, registrations, licenses, franchises, customer
lists, tax refunds, tax refund claims, computer programs, all claims under
guaranties, security interests or other security held by or granted to such
Borrower to secure payment of any of the Receivables by a Customer (other than
to the extent covered by Receivables) all rights of indemnification and all
other intangible property of every kind and nature (other than Receivables).

“Governmental Acts” shall have the meaning set forth in Section 2.17 hereof.

“Governmental Body” shall mean any nation or government, any state or other
political subdivision thereof or any entity, authority, agency, division or
department exercising the

 

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executive, legislative, judicial, taxing, regulatory or administrative powers or
functions of or pertaining to a government (including any supra-national bodies
such as the European Union or the European Central Bank) and any group or body
charged with setting financial accounting or regulatory capital rules or
standards (including, without limitation, the Financial Accounting Standards
Board, the Bank for International Settlements or the Basel Committee on Banking
Supervision or any successor or similar authority to any of the foregoing).

“GPCM” shall mean Green Plains Commodity Management, LLC, an Iowa limited
liability company.

“Guarantor” shall mean Holdings, GPCM and any other Person who may hereafter
guarantee payment or performance of the whole or any part of the Obligations and
“Guarantors” means collectively all such Persons.

“Guarantor Security Agreement” shall mean any security agreement executed by any
Guarantor in favor of Agent securing the Obligations or the Guaranty of such
Guarantor, in form and substance satisfactory to Agent.

“Guaranty” shall mean any guaranty, in form and substance satisfactory to Agent,
of the obligations of Borrowers executed by a Guarantor in favor of Agent for
its benefit and for the ratable benefit of Lenders.

“Hazardous Discharge” shall have the meaning set forth in Section 4.19(d)
hereof.

“Hazardous Substance” shall mean, without limitation, any flammable explosives,
radon, radioactive materials, asbestos, urea formaldehyde foam insulation,
polychlorinated biphenyls, petroleum and petroleum products, methane, hazardous
materials, Hazardous Wastes, hazardous or Toxic Substances or related materials
as defined in or subject to regulation under Environmental Laws.

“Hazardous Wastes” shall mean all waste materials subject to regulation under
CERCLA, RCRA or applicable state law, and any other applicable Federal and state
laws now in force or hereafter enacted relating to hazardous waste disposal.

“Hedge Liabilities” shall mean the Foreign Currency Hedge Liabilities and the
Interest Rate Hedge Liabilities.

“Holdings” shall mean Green Plains Inc., an Iowa corporation.

“Increased Tax Burden” shall mean the additional federal, state or local taxes
assumed to be payable by a member of any Borrower as a result of such Borrower’s
status as a limited liability company as evidenced and substantiated by the tax
returns filed by such Borrower as a limited liability company, with such taxes
being calculated for all members at the highest marginal rate applicable to any
member.

“Indebtedness” of a Person at a particular date shall mean all obligations of
such Person which in accordance with GAAP would be classified upon a balance
sheet as liabilities (except capital stock and surplus earned or otherwise) and
in any event, without limitation by reason of

 

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enumeration, shall include all indebtedness, debt and other similar monetary
obligations of such Person whether direct or guaranteed, and all premiums, if
any, due at the required prepayment dates of such indebtedness, and all
indebtedness secured by a Lien on assets owned by such Person, whether or not
such indebtedness actually shall have been created, assumed or incurred by such
Person. Any indebtedness of such Person resulting from the acquisition by such
Person of any assets subject to any Lien shall be deemed, for the purposes
hereof, to be the equivalent of the creation, assumption and incurring of the
indebtedness secured thereby, whether or not actually so created, assumed or
incurred.

“Indemnified Taxes” shall mean Taxes other than Excluded Taxes.

“Ineligible Security” shall mean any security which may not be underwritten or
dealt in by member banks of the Federal Reserve System under Section 16 of the
Banking Act of 1933 (12 U.S.C. Section 24, Seventh), as amended.

“Insolvency Event” shall mean, with respect to any Person, including without
limitation any Lender, such Person or such Person’s direct or indirect parent
company (a) becomes the subject of a bankruptcy or insolvency proceeding
(including any proceeding under Title 11 of the United States Code), or
regulatory restrictions, (b) has had a receiver, conservator, trustee,
administrator, custodian, assignee for the benefit of creditors or similar
Person charged with the reorganization or liquidation of its business appointed
for it or has called a meeting of its creditors, (c) admits in writing its
inability, or be generally unable, to pay its debts as they become due or cease
operations of its present business, (d) with respect to a Lender, such Lender is
unable to perform hereunder due to the application of Applicable Law, or (e) in
the good faith determination of the Agent, has taken any action in furtherance
of, or indicating its consent to, approval of, or acquiescence in, any such
proceeding or appointment of a type described in clause (a) or (b), provided
that an Insolvency Event shall not result solely by virtue of any ownership
interest, or the acquisition of any ownership interest, in such Person or such
Person’s direct or indirect parent company by a Governmental Body or
instrumentality thereof if, and only if, such ownership interest does not result
in or provide such Person 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 Person (or such Governmental Body or instrumentality)
to reject, repudiate, disavow or disaffirm any contracts or agreements made by
such Person.

“Intellectual Property” shall mean property constituting a patent, copyright,
trademark (or any application in respect of the foregoing), service mark,
copyright, copyright application, trade name, mask work, trade secrets, design
right, assumed name or license or other right to use any of the foregoing under
Applicable Law.

“Intellectual Property Claim” shall mean the assertion by any Person of a claim
(whether asserted in writing, by action, suit or proceeding or otherwise) that
any Borrower’s ownership, use, marketing, sale or distribution of any Inventory,
Equipment, Intellectual Property or other property or asset is violative of any
ownership of or right to use any Intellectual Property of such Person.

“Interest Period” shall mean the period provided for any Eurodollar Rate Loan
pursuant to Section 2.2(b).

 

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“Interest Rate Hedge” shall mean an interest rate exchange, collar, cap, swap,
adjustable strike cap, adjustable strike corridor or similar agreements entered
into by any Borrower or its Subsidiaries in order to provide protection to, or
minimize the impact upon, such Borrower, any Guarantor and/or their respective
Subsidiaries of increasing floating rates of interest applicable to
Indebtedness.

“Interest Rate Hedge Liabilities” shall have the meaning given in the definition
of “Lender-Provided Interest Rate Hedge.”

“Inventory” shall mean and include as to each Borrower all of such Borrower’s
now owned or hereafter acquired goods, merchandise and other personal property,
wherever located, to be furnished under any consignment arrangement, contract of
service or held for sale or lease, all raw materials, work in process, finished
goods and materials and supplies of any kind, nature or description which are or
might be used or consumed in such Borrower’s business or used in selling or
furnishing such goods, merchandise and other personal property, and all
documents of title or other documents representing them.

“Inventory Advance Rate” shall have the meaning set forth in
Section 2.1(a)(y)(ii) hereof.

“Inventory NOLV Advance Rate” shall have the meaning set forth in
Section 2.1(a)(y)(ii) hereof.

“Investment Property” shall mean and include as to each Borrower, all of such
Borrower’s now owned or hereafter acquired securities (whether certificated or
uncertificated), securities entitlements, securities accounts, commodities
contracts and commodities accounts.

“Issuer” shall mean any Person who issues a Letter of Credit and/or accepts a
draft pursuant to the terms hereof.

“Law(s)” shall mean any law(s) (including common law), constitution, statute,
treaty, regulation, rule, ordinance, opinion, issued guidance, release, ruling,
order, executive order, injunction, writ, decree, bond, judgment, authorization
or approval, lien or award of or any settlement arrangement, by agreement,
consent or otherwise, with any Governmental Body, foreign or domestic.

“Lender” and “Lenders” shall have the meaning ascribed to such term in the
preamble to this Agreement and shall include each Person which becomes a
transferee, successor or assign of any Lender.

“Lender-Provided Foreign Currency Hedge” shall mean a Foreign Currency Hedge
which is provided by any Lender or any of its Affiliates and for which such
Lender confirms to Agent in writing prior to the execution thereof that it: (a)
is documented in a standard International Swap Dealers Association, Inc. Master
Agreement or another reasonable and customary manner; (b) provides for the
method of calculating the reimbursable amount of the provider’s credit exposure
in a reasonable and customary manner; and (c) is entered into for hedging
(rather than speculative) purposes. The liabilities owing to the provider of any
Lender-Provided Foreign Currency Hedge (the “Foreign Currency Hedge
Liabilities”) by any Borrower, Guarantor, or any of their respective
Subsidiaries that is party to such Lender-Provided Foreign Currency Hedge

 

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shall, for purposes of this Agreement and all Other Documents be “Obligations”
of such Person and of each other Borrower and Guarantor, be guaranteed
obligations under any Guaranty and secured obligations under any Guarantor
Security Agreement, as applicable, and otherwise treated as Obligations for
purposes of the Other Documents, except to the extent constituting Excluded
Hedge Liabilities of such Person. The Liens securing the Foreign Currency Hedge
Liabilities shall be pari passu with the Liens securing all other Obligations
under this Agreement and the Other Documents.

“Lender-Provided Interest Rate Hedge” shall mean an Interest Rate Hedge which is
provided by any Lender or any of its Affiliates and with respect to which such
Lender confirms to Agent in writing prior to the execution thereof that it: (a)
is documented in a standard International Swap Dealers Association, Inc. Master
Agreement or another reasonable and customary manner; (b) provides for the
method of calculating the reimbursable amount of the provider’s credit exposure
in a reasonable and customary manner; and (c) is entered into for hedging
(rather than speculative) purposes. The liabilities owing to the provider of any
Lender-Provided Interest Rate Hedge (the “Interest Rate Hedge Liabilities”) by
any Borrower, Guarantor, or any of their respective Subsidiaries that is party
to such Lender-Provided Interest Rate Hedge shall, for purposes of this
Agreement and all Other Documents be “Obligations” of such Person and of each
other Borrower and Guarantor, be guaranteed obligations under any Guaranty and
secured obligations under any Guarantor Security Agreement, as applicable, and
otherwise treated as Obligations for purposes of the Other Documents, except to
the extent constituting Excluded Hedge Liabilities of such Person. The Liens
securing the Hedge Liabilities shall be pari passu with the Liens securing all
other Obligations under this Agreement and the Other Documents.

“Letter of Credit Fees” shall have the meaning set forth in Section 3.2.

“Letter of Credit Borrowing” shall have the meaning set forth in
Section 2.12(d).

“Letter of Credit Sublimit” shall mean $15,000,000.

“Letters of Credit” shall have the meaning set forth in Section 2.9.

“Lien” shall mean any mortgage, deed of trust, pledge, hypothecation,
assignment, security interest, lien (whether statutory or otherwise), Charge,
claim or encumbrance, or preference, priority or other security agreement or
preferential arrangement held or asserted in respect of any asset of any kind or
nature whatsoever including any conditional sale or other title retention
agreement, any lease having substantially the same economic effect as any of the
foregoing, and the filing of, or agreement to give, any financing statement
under the Uniform Commercial Code or comparable law of any jurisdiction.

“Lien Waiver/Inventory Acknowledgments” shall mean, individually and
collectively, as the context may require (i) an acknowledgment letter executed
by an Affiliate Plant in favor of Agent confirming that title has passed to
Borrowers and that any product located in the storage tank located on such
Affiliate Plant’s premises is being held for the benefit of Borrowers, (ii) an
agreement which is executed in favor of Agent by a Person (including an
Affiliate Plant) who owns or occupies premises at which any Collateral may be
located from time to time and by

 

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which such Person shall waive any Lien that such Person may ever have with
respect to any of the Collateral and shall authorize Agent from time to time to
enter upon the premises to inspect or remove the Collateral from such premises
or to use such premises to store or dispose of such Inventory and (iii) an
acknowledgment letter executed by any lender providing financing to the
Affiliate Plant in favor of Agent confirming that title has passed from such
Affiliate Plant to Borrowers and Agent’s interest in any Inventory located in
such tank is free and clear of any claims or interests of such lender of the
Affiliate Plant, in each case in form and substance satisfactory to Agent.

“Material Adverse Effect” shall mean a material adverse effect on (a) the
condition (financial or otherwise), results of operations, assets, business,
properties or prospects of any Borrower or any Guarantor, (b) any Borrower’s
ability to duly and punctually pay or perform the Obligations in accordance with
the terms thereof, (c) the value of the Collateral, or Agent’s Liens on the
Collateral or the priority of any such Lien or (d) the practical realization of
the benefits of Agent’s and each Lender’s rights and remedies under this
Agreement and the Other Documents.

“Material Contract” shall mean any contract, agreement, instrument, permit,
lease or license, written or oral, of any Borrower, (i) which the failure to
comply with could reasonably be expected to result in a Material Adverse Effect
or (ii) that is deemed to be a material contract under any securities laws
applicable to such Person, including the Securities Act of 1933.

“Maximum Face Amount” shall mean, with respect to any outstanding Letter of
Credit, the face amount of such Letter of Credit including all automatic
increases provided for in such Letter of Credit, whether or not any such
automatic increase has become effective.

“Maximum Loan Amount” shall mean $150,000,000, as such amount may be increased
from time to time as a result of any Borrower Revolver Increase.

“Maximum Swing Loan Advance Amount” shall mean $25,000,000.

“Maximum Undrawn Amount” shall mean with respect to any outstanding Letter of
Credit, the amount of such Letter of Credit that is or may become available to
be drawn, including all automatic increases provided for in such Letter of
Credit, whether or not any such automatic increase has become effective.

“Modified Commitment Transfer Supplement” shall have the meaning set forth in
Section 16.3(d).

“Multiemployer Plan” shall mean a “multiemployer plan” as defined in
Section 3(37) or 4001(a)(3) of ERISA to which contributions are required or,
within the preceding five plan years, were required by any Borrower or any
member of the Controlled Group.

“Multiple Employer Plan” shall mean a Plan which has two or more contributing
sponsors (including any Borrower or any member of the Controlled Group) at least
two of whom are not under common control, as such a plan is described in
Section 4063 or 4064 of ERISA.

“Natural Gas Inventory Advance Rate” shall have the meaning given in
Section 2.1(a)(y)(iii).

 

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“Natural Gas Inventory NOLV Advance Rate” shall have the meaning given in
Section 2.1(a)(y)(iii).

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

“Non-Qualifying Party” shall mean any Borrower or any Guarantor that on the
Eligibility Date fails for any reason to qualify as an Eligible Contract
Participant.

“Notes” shall mean, collectively, the Revolving Credit Note and the Swing Loan
Note.

“Obligations” shall mean and include any and all loans (including without
limitation, all Advances, Cash Management Liabilities and Hedge Liabilities),
advances, debts, liabilities, obligations, covenants and duties owing by any
Borrower to Lenders or Agent or to any other direct or indirect subsidiary or
affiliate of Agent or any Lender of any kind or nature, present or future
(including any interest or other amounts accruing thereon, and any costs and
expenses of any Person payable by any Borrower and any indemnification
obligations payable by any Borrower arising or payable after maturity, or after
the filing of any petition in bankruptcy, or the commencement of any insolvency,
reorganization or like proceeding relating to any Borrower, whether or not a
claim for post-filing or post-petition interest or other amounts is allowable or
allowed in such proceeding), whether or not evidenced by any note, guaranty or
other instrument, whether arising under any agreement, instrument or document,
(including this Agreement and the Other Documents) whether or not for the
payment of money, whether arising by reason of an extension of credit, opening
of a letter of credit, loan, equipment lease or guarantee, under any interest or
currency swap, future, option or other similar agreement, or in any other
manner, whether arising out of overdrafts or deposit or other accounts or
electronic funds transfers (whether through automated clearing houses or
otherwise) or out of the Agent’s or any Lenders non-receipt of or inability to
collect funds or otherwise not being made whole in connection with depository
transfer check or other similar arrangements, whether direct or indirect
(including those acquired by assignment or participation), absolute or
contingent, joint or several, due or to become due, now existing or hereafter
arising, contractual or tortious, liquidated or unliquidated, regardless of how
such indebtedness or liabilities arise or by what agreement or instrument they
may be evidenced or whether evidenced by any agreement or instrument, including,
but not limited to, any and all of any Borrower’s Indebtedness and/or
liabilities under this Agreement, the Other Documents or under any other
agreement between Agent or Lenders and any Borrower and any amendments,
extensions, renewals or increases and all costs and expenses of Agent and any
Lender incurred in the documentation, negotiation, modification, enforcement,
collection or otherwise in connection with any of the foregoing, including but
not limited to reasonable attorneys’ fees and expenses and all obligations of
any Borrower to Agent or Lenders to perform acts or refrain from taking any
action. Notwithstanding anything to the contrary contained in the foregoing, the
Obligations shall not include any Excluded Hedge Liabilities.

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

“Off-load Inventory” shall mean the Inventory of a Borrower that has been
shipped but not yet delivered to a Customer that results in the creation of an
Off-load Receivable.

 

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“Off-load Receivable” shall mean a Receivable of a Borrower that has been
invoiced to a Customer for Inventory that has been shipped but not yet delivered
to such Customer in accordance with the terms of the contract between such
Borrower and Customer.

“Ordinary Course of Business” shall mean with respect to any Borrower, the
ordinary course of such Borrower’s business as conducted on the Closing Date.

“Original Owners” shall mean Holdings.

“Other Documents” shall mean, the Notes, the Perfection Certificates, any
Guaranty, any Guarantor Security Agreement, any Pledge Agreement, any
Lender-Provided Interest Rate Hedge, the Fee Letter and any and all other
agreements, instruments and documents, including intercreditor agreements,
guaranties, pledges, powers of attorney, consents, interest or currency swap
agreements or other similar agreements and all other writings heretofore, now or
hereafter executed by any Borrower or any Guarantor and/or delivered to Agent or
any Lender in respect of the transactions contemplated by this Agreement, in
each case together with all extensions, renewals, amendments, supplements,
modifications, substitutions and replacements thereto and thereof.

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

“Out-of-Formula Loans” shall have the meaning set forth in Section 16.2(e).

“Parent” of any Person shall mean a corporation or other entity owning, directly
or indirectly at least 50% of the shares of stock or other ownership interests
having ordinary voting power to elect a majority of the directors of the Person,
or other Persons performing similar functions for any such Person.

“Participant” shall mean each Person who shall be granted the right by any
Lender to participate in any of the Advances and who shall have entered into a
participation agreement in form and substance satisfactory to such Lender.

“Participation Advance” shall have the meaning set forth in Section 2.12(d).

“Participation Commitment” shall mean each Lender’s obligation to buy a
participation of the Letters of Credit issued hereunder.

“Payment Office” shall mean initially Two Tower Center Boulevard, East
Brunswick, New Jersey 08816; thereafter, such other office of Agent, if any,
which it may designate by notice to Borrowing Agent and to each Lender to be the
Payment Office.

“PBGC” shall mean the Pension Benefit Guaranty Corporation established pursuant
to Subtitle A of Title IV of ERISA or any successor.

 

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“Perfection Certificates” shall mean collectively, the Perfection Certificates
and the responses thereto provided by each Borrower and each Guarantor and
delivered to Agent.

“Pension Benefit Plan” shall mean at any time any “employee pension benefit
plan” as defined in Section 3(2) of ERISA (including a Multiple Employer Plan,
but not a Multiemployer Plan) which is covered by Title IV of ERISA or is
subject to the minimum funding standards under Section 412, 430 or 436 of the
Code and either (i) is maintained or to which contributions are required by
Borrower or any member of the Controlled Group or (ii) has at any time within
the preceding five years been maintained or to which contributions have been
required by a Borrower or any entity which was at such time a member of the
Controlled Group.

“Permitted Discretion” shall mean, with respect to Agent, the exercise in good
faith of its reasonable business judgment from the perspective of an asset based
lender under comparable circumstances.

“Permitted Encumbrances” shall mean: (a) Liens in favor of Agent for the benefit
of Agent and Lenders; (b) Liens for taxes, assessments or other governmental
charges not delinquent or being Properly Contested; (c) Reserved; (d) deposits
or pledges to secure obligations under worker’s compensation, social security or
similar laws, or under unemployment insurance; (e) deposits or pledges to secure
bids, tenders, contracts (other than contracts for the payment of money),
leases, statutory obligations, surety and appeal bonds and other obligations of
like nature arising in the Ordinary Course of Business; (f) Liens arising by
virtue of the rendition, entry or issuance against any Borrower or any
Subsidiary, or any property of any Borrower or any Subsidiary, of any judgment,
writ, order, or decree for so long as each such Lien (x) is in existence for
less than 20 consecutive days after it first arises or is being Properly
Contested and (y) is at all times junior in priority to any Liens in favor of
Agent; (g) mechanics’, workers’, materialmen’s or other like Liens arising in
the Ordinary Course of Business with respect to obligations which are not due or
which are being Properly Contested; (h) Liens placed upon fixed assets hereafter
acquired to secure a portion of the purchase price thereof, provided that
(x) any such lien shall not encumber any other property of any Borrower and
(y) the aggregate amount of Indebtedness secured by such Liens incurred as a
result of such purchases during any fiscal year shall not exceed the amount
provided for in Section 7.6; (i) other Liens incidental to the conduct of any
Borrower’s business or the ownership of its property and assets which were not
incurred in connection with the borrowing of money or the obtaining of advances
or credit so long as such Lien is junior in priority to any Liens in favor of
Agent, and which do not in the aggregate materially detract from Agent’s or
Lenders’ rights in and to the Collateral or the value of any Borrower’s property
or assets and which do not materially impair the use thereof in the operation of
any Borrower’s business; and (j) Liens disclosed on Schedule 1.2.

“Person” shall mean any individual, sole proprietorship, partnership,
corporation, business trust, joint stock company, trust, unincorporated
organization, association, limited liability company, limited liability
partnership, institution, public benefit corporation, joint venture, entity or
Governmental Body (whether federal, state, county, city, municipal or otherwise,
including any instrumentality, division, agency, body or department thereof).

“Plan” shall mean any employee benefit plan within the meaning of Section 3(3)

 

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of ERISA (including a Pension Benefit Plan and a Multiemployer Plan), maintained
for employees of any Borrower or any member of the Controlled Group or any such
Plan to which any Borrower or any member of the Controlled Group is required to
contribute on behalf of any of its employees.

“Pledge Agreement” shall mean any pledge agreements executed subsequent to the
Closing Date by any Person to secure the Obligations, in form and substance
reasonably satisfactory to Agent.

“PNC” shall have the meaning set forth in the preamble to this Agreement and
shall extend to all of its successors and assigns.

“Post-Term Cash Collateral” shall have the meaning set forth in Section 2.10(e)
hereof.

“Post-Term Letter of Credit” shall have the meaning set forth in Section 2.10(d)
hereof.

“Post-Term Letter of Credit Obligations” shall have the meaning set forth in
Section 2.10(e) hereof.

“Pro Forma Balance Sheet” shall have the meaning set forth in Section 5.5(a)
hereof.

“Pro Forma Financial Statements” shall have the meaning set forth in
Section 5.5(b) hereof.

“Properly Contested” shall mean, in the case of any Indebtedness or Lien, as
applicable, of any Person (including any taxes) that is not paid as and when due
or payable by reason of such Person’s bona fide dispute concerning its liability
to pay same or concerning the amount thereof, (i) such Indebtedness or Lien, as
applicable, is being properly contested in good faith by appropriate proceedings
promptly instituted and diligently conducted; (ii) such Person has established
appropriate reserves as shall be required in conformity with GAAP; (iii) the
non-payment of such Indebtedness will not have a Material Adverse Effect and
will not result in the forfeiture of any assets of such Person; (iv) no Lien is
imposed upon any of such Person’s assets with respect to such Indebtedness
unless (x) such Lien does not attach to any Receivables or Inventory, (y) such
Lien is at all times junior and subordinate in priority to the Liens in favor of
the Agent (except only with respect to property taxes that have priority as a
matter of applicable state law), and (z) enforcement of such Lien is stayed
during the period prior to the final resolution or disposition of such dispute;
(v) if such Indebtedness or Lien as applicable, results from, or is determined
by the entry, rendition or issuance against a Person or any of its assets of a
judgment, writ, order or decree, enforcement of such judgment, writ, order or
decree is stayed pending a timely appeal or other judicial review; and (vi) if
such contest is abandoned, settled or determined adversely (in whole or in part)
to such Person, such Person forthwith pays such Indebtedness and all penalties,
interest and other amounts due in connection therewith.

“Projections” shall have the meaning set forth in Section 5.5(b) hereof.

“Published Rate” shall mean the rate of interest published each Business Day in
the Wall Street Journal “Money Rates” listing under the caption “London
Interbank Offered Rates” for a one month period (or, if no such rate is
published therein for any reason, then the Published Rate shall be the
Eurodollar Rate for a one month period as published in another publication
selected by the Agent).

 

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“Purchasing CLO” shall have the meaning set forth in Section 16.3(d) hereof.

“Purchasing Lender” shall have the meaning set forth in Section 16.3(c) hereof.

“Qualified ECP Loan Party” shall mean each Borrower or Guarantor that on the
Eligibility Date is (a) a corporation, partnership, proprietorship,
organization, trust, or other entity other than a “commodity pool” as defined in
Section 1a(10) of the CEA and CFTC regulations thereunder that has total assets
exceeding $10,000,000 or (b) an Eligible Contract Participant that can cause
another person to qualify as an Eligible Contract Participant on the Eligibility
Date under Section 1a(18)(A)(v)(II) of the CEA by entering into or otherwise
providing a “letter of credit or keepwell, support, or other agreement” for
purposes of Section 1a(18)(A)(v)(II) of the CEA.

“RCRA” shall mean the Resource Conservation and Recovery Act, 42 U.S.C. §§ 6901
et seq., as same may be amended from time to time.

“Real Property” shall mean all of each Borrower’s right, title and interest in
and to the owned and leased premises identified on Schedule 4.19 hereto or which
is hereafter owned or leased by any Borrower.

“Receivables” shall mean and include, as to each Borrower, all of such
Borrower’s accounts, contract rights, instruments (including those evidencing
indebtedness owed to such Borrower by its Affiliates), documents, chattel paper
(including electronic chattel paper), general intangibles relating to accounts,
drafts and acceptances, credit card receivables and all other forms of
obligations owing to such Borrower arising out of or in connection with the sale
or lease of Inventory or the rendition of services, all supporting obligations,
guarantees and other security therefor, whether secured or unsecured, now
existing or hereafter created, and whether or not specifically sold or assigned
to Agent hereunder.

“Receivables Advance Rate” shall have the meaning set forth in
Section 2.1(a)(y)(i) hereof.

“Register” shall have the meaning set forth in Section 16.3(e).

“Reimbursement Obligation” shall have the meaning set forth in
Section 2.12(b)hereof.

“Release” shall have the meaning set forth in Section 5.7(c)(i) hereof.

“Replacement Lender” shall have the meaning set forth in Section 3.11 hereof.

“Reportable Compliance Event” shall mean that any Covered Entity becomes a
Sanctioned Person, or is charged by indictment, criminal complaint or similar
charging instrument, arraigned, or custodially detained in connection with any
Anti-Terrorism Law or any predicate crime to any Anti-Terrorism Law, or has
knowledge of facts or circumstances to the effect that it is reasonably likely
that any aspect of its operations is in actual or probable violation of any
Anti-Terrorism Law.

 

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“Reportable ERISA Event” shall mean a reportable event described in Section 4043
of ERISA or the regulations promulgated thereunder, other than an event for
which the 30-day notice period is waived.

“Required Lenders” shall mean Lenders (not including the Swing Loan Lender (in
its capacity as such Swing Loan Lender) or any Defaulting Lender) holding more
than fifty percent (50%) of either (a) the aggregate of the Revolving Commitment
Amounts of all Lenders (excluding any Defaulting Lender), or (b) after the
termination of all commitments of the Lenders hereunder, the sum of (x) the
outstanding Revolving Advances, and (y) (i) the aggregate of the Maximum Undrawn
Amount of all outstanding Letters of Credit and outstanding Swing Loans
multiplied by (ii) the Revolving Commitments Percentages of all Lenders as most
recently in effect excluding any Defaulting Lender; provided, however, if there
are fewer than three (3) Lenders, Required Lenders shall mean all Lenders
(excluding any Defaulting Lender).

“Reserve Percentage” shall mean as of any day the maximum percentage in effect
on such day as prescribed by the Board of Governors of the Federal Reserve
System (or any successor) for determining the reserve requirements (including
supplemental, marginal and emergency reserve requirements) with respect to
eurocurrency funding (currently referred to as “Eurocurrency Liabilities”.

“Revolving Advances” shall mean Advances made other than Letters of Credit and
the Swing Loans.

“Revolving Commitment” shall mean, as to any Lender, the obligation of such
Lender (if applicable), to make Revolving Advances and participate in Swing
Loans and Letters of Credit, in an aggregate principal and/or face amount not to
exceed the Revolving Commitment Percentage of such Lender.

“Revolving Commitment Amount” of any Lender shall mean the Revolving Commitment
Amount set forth below such Lender’s name on the signature page hereof as same
may be adjusted upon any assignment by or to a Lender pursuant to
Section 16.3(c) or (d) hereof, upon any Borrower Revolver Increase pursuant to
Section 2.24 in which such Lender shall participate.

“Revolving Commitment Percentage” shall mean the Revolving Commitment Percentage
(if any) set forth adjacent to such Lender’s name on the signature page hereof
as same may be adjusted upon any assignment by or to a Lender pursuant to
Section 16.3(c) or (d) hereof or upon any Borrower Revolver Increase pursuant to
Section 2.24 in which such Lender shall participate (or, in the case of any
Lender that became party to this Agreement after the Closing Date pursuant to
Section 16.3(c) or (d) hereof, the Revolving Commitment Percentage (if any) of
such Lender as set forth in the applicable Commitment Transfer Supplement).

“Revolving Credit Note” shall mean the promissory note referred to in
Section 2.1(a) hereof.

“Revolving Interest Rate” shall mean an interest rate per annum equal to (a) the
sum of the Alternate Base Rate plus one and one-half percent (1.50%) with
respect to Domestic Rate Loans and (b) the sum of the Eurodollar Rate plus two
and one-half percent (2.50%) with respect to Eurodollar Rate Loans.

 

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“Sanctioned Country” shall mean a country subject to a sanctions program
maintained under any Anti-Terrorism Law.

“Sanctioned Person” shall mean any individual person, group, regime, entity or
thing listed or otherwise recognized as a specially designated, prohibited,
sanctioned or debarred person, group, regime, entity or thing, or subject to any
limitations or prohibitions (including but not limited to the blocking of
property or rejection of transactions), under any Anti-Terrorism Law or subject
to any Sanctions.

“Sanctions” shall mean any sanction administered or enforced by the U.S.
Government (including OFAC), United Nations Security Council, European Union,
Her Majesty’s Treasury or other sanctions authority.

“SEC” shall mean the Securities and Exchange Commission or any successor
thereto.

“Secured Parties” shall mean, collectively, Agent, Issuer, Swing Loan Lender and
Lenders, together with any Affiliates of Agent or any Lender to whom any Hedge
Liabilities or Cash Management Liabilities are owed and with each other holder
of any of the Obligations, and the respective successors and assigns of each of
them.

“Securities Act” shall mean the Securities Act of 1933, as amended.

“Settlement Date” shall mean the Closing Date and thereafter Wednesday or
Thursday of each week or more frequently if Agent deems appropriate unless such
day is not a Business Day in which case it shall be the next succeeding Business
Day.

“Subordinated Debt” shall mean Indebtedness to Holdings, subordinated pursuant
to a Subordination Agreement.

“Subordinated Loan Documentation” shall mean the subordinated promissory notes
issued by Borrowers in favor of Holdings from time to time evidencing the
subordinated loans made by Holdings to Borrowers, in form and substance
reasonably satisfactory to Agent.

“Subordination Agreement” shall mean the Subordination Agreements executed by
and among Agent, Borrowers and Holdings from time to time in the form of Exhibit
1.4 attached hereto.

“Subsidiary” of any Person shall mean a corporation or other entity of whose
Equity Interests having ordinary voting power (other than Equity Interests
having such power only by reason of the happening of a contingency) to elect a
majority of the directors of such corporation, or other Persons performing
similar functions for such entity, are owned, directly or indirectly, by such
Person.

“Subsidiary Stock” shall mean all of the issued and outstanding Equity Interests
of any Subsidiary owned by any Borrower (not to exceed 65% of the Equity
Interests of any Foreign Subsidiary).

 

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“Supermajority Lenders” shall mean Lenders (not including the Swing Loan Lender
(in its capacity as such Swing Loan Lender) or any Defaulting Lender) holding no
less than 66 2/3% of either (a) the aggregate of the Revolving Commitment
Amounts of all Lenders (excluding any Defaulting Lender), or (b) after the
termination of all commitments of the Lenders hereunder, the sum of (x) the
outstanding Revolving Advances and (y) (i) the aggregate of the Maximum Undrawn
Amount of all outstanding Letters of Credit and outstanding Swing Loans
multiplied by (ii) the Revolving Commitments Percentages of all Lenders as most
recently in effect excluding any Defaulting Lender.

“Swap” shall mean any “swap” as defined in Section 1a(47) of the CEA and
regulations thereunder other than (a) a swap entered into on, or subject to the
rules of, a board of trade designated as a contract market under Section 5 of
the CEA, or (b) a commodity option entered into pursuant to CFTC Regulation
32.3(a).

“Swap Obligation” means any obligation to pay or perform under any agreement,
contract or transaction that constitutes a Swap which is also a Lender-Provided
Interest Rate Hedge, or a Lender-Provided Foreign Currency Hedge.

“Swing Loan Lender” shall mean PNC, in its capacity as lender of the Swing
Loans.

“Swing Loan Note” shall mean the promissory note described in Section 2.4(a)
hereof.

“Swing Loan Request” shall mean a request for Swing Loans made in accordance
with Section 2.4(a) hereof.

“Swing Loans” shall mean, collectively, Advances made by Swing Loan Lender to
Borrowers pursuant to Section 2.4 hereof.

“Swing Loan Request” shall have the meaning set forth in Section 2.4(b) hereof.

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

“Term” shall have the meaning set forth in Section 13.1 hereof.

“Termination Event” shall mean: (a) a Reportable ERISA Event with respect to any
Plan; (b) the withdrawal of any Borrower or any member of the Controlled Group
from a Plan during a plan year in which such entity was a “substantial employer”
as defined in Section 4001(a)(2) of ERISA or a cessation of operations that is
treated as such a withdrawal under Section 4062(e) of ERISA; (c) the providing
of notice of intent to terminate a Plan in a distress termination described in
Section 4041(c) of ERISA; (d) the commencement of proceedings by the PBGC to
terminate a Plan; (e) any event or condition (i) which might constitute grounds
under Section 4042 of ERISA for the termination of, or the appointment of a
trustee to administer, any Plan, or (ii) that may result in the termination of a
Multiemployer Plan pursuant to Section 4041A of ERISA; (f) the partial or
complete withdrawal, within the meaning of Section 4203 or 4205 of

 

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ERISA, of any Borrower or any member of the Controlled Group from a
Multiemployer Plan; (g) notice that a Multiemployer Plan is subject to
Section 4245 of ERISA; or (h) the imposition of any liability under Title IV of
ERISA, other than for PBGC premiums due but not delinquent, upon any Borrower or
any member of the Controlled Group.

“Third Party Contracts” shall mean those certain ethanol marketing agreements
and distillers grain marketing agreements by and among a Person (other than an
Affiliate Plant) and Borrowers, or any of them, and each individually referred
to as a “Third Party Contract”.

“Toxic Substance” shall mean and include any material present on the Real
Property or the Leasehold Interests which has been shown to have significant
adverse effect on human health or which is subject to regulation under the Toxic
Substances Control Act (TSCA), 15 U.S.C. §§ 2601 et seq., applicable state law,
or any other applicable Federal or state laws now in force or hereafter enacted
relating to toxic substances. “Toxic Substance” includes but is not limited to
asbestos, polychlorinated biphenyls (PCBs) and lead-based paints.

“Transactions” shall have the meaning set forth in Section 5.5 hereof.

“Transferee” shall have the meaning set forth in Section 16.3(d) hereof.

“Undrawn Availability” at a particular date shall mean an amount equal to
(a) the lesser of (i) the Formula Amount or (ii) the Maximum Loan Amount less
the Maximum Undrawn Amount of all outstanding Letters of Credit, less the
outstanding balance of any Fuel Taxes that are due and owing, minus (b) the sum
of (i) the outstanding amount of Revolving Advances and Swing Loans, plus
(ii) all amounts due and owing to any Borrower’s trade creditors which are
outstanding ten (10) days or more past their due date unless extended on formal
terms acceptable to Agent, plus (iii) fees and expenses for which Borrowers are
liable but which have not been paid or charged to Borrowers’ Account.

“Unfunded Capital Expenditures” shall mean Capital Expenditures made through
Revolving Advances, Swing Loans or out of Borrowers’ own funds other than
through equity contributed subsequent to the Closing Date or purchase money or
other financing or lease transactions permitted hereunder.

“Unhedged Inventory” shall mean Inventory of Borrowers for which Borrowers have
not obtained back to back buy/sell hedging agreements.

“Uniform Commercial Code” shall have the meaning set forth in Section 1.3
hereof.

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

“USA PATRIOT Act” shall mean the Uniting and Strengthening America by Providing
Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001,
Public Law 107-56, as the same has been, or shall hereafter be, renewed,
extended, amended or replaced.

“Week” shall mean the time period commencing with the opening of business on a
Wednesday and ending on the end of business the following Tuesday.

 

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1.3. Uniform Commercial Code Terms. All terms used herein and defined in the
Uniform Commercial Code as adopted in the State of New York from time to time
(the “Uniform Commercial Code”) shall have the meaning given therein unless
otherwise defined herein. Without limiting the foregoing, the terms “accounts”,
“chattel paper”, “commercial tort claims”, “instruments”, “general intangibles”,
“goods”, “payment intangibles”, “proceeds”, “supporting obligations”,
“securities”, “investment property”, “documents”, “deposit accounts”,
“software”, “letter of credit rights”, “inventory”, “equipment” and “fixtures”,
as and when used in the description of Collateral shall have the meanings given
to such terms in Articles 8 or 9 of the Uniform Commercial Code. To the extent
the definition of any category or type of collateral is expanded by any
amendment, modification or revision to the Uniform Commercial Code, such
expanded definition will apply automatically as of the date of such amendment,
modification or revision.

1.4. Certain Matters of Construction. The terms “herein”, “hereof” and
“hereunder” and other words of similar import refer to this Agreement as a whole
and not to any particular section, paragraph or subdivision. All references
herein to Articles, Sections, Exhibits and Schedules shall be construed to refer
to Articles and Sections of, and Exhibits and Schedules to, this Agreement. Any
pronoun used shall be deemed to cover all genders. Wherever appropriate in the
context, terms used herein in the singular also include the plural and vice
versa. All references to statutes and related regulations shall include any
amendments of same and any successor statutes and regulations. Unless otherwise
provided, all references to any instruments or agreements to which Agent is a
party, including references to any of the Other Documents, shall include any and
all modifications, supplements or amendments thereto, any and all restatements
or replacements thereof and any and all extensions or renewals thereof. All
references herein to the time of day shall mean the time in New York, New York.
Unless otherwise provided, all financial calculations shall be performed with
Inventory valued on a first-in, first-out basis. Whenever the words “including”
or “include” shall be used, such words shall be understood to mean “including,
without limitation” or “include, without limitation”. A Default or Event of
Default shall be deemed to exist at all times during the period commencing on
the date that such Default or Event of Default occurs to the date on which such
Default or Event of Default is waived in writing pursuant to this Agreement or,
in the case of a Default, is cured within any period of cure expressly provided
for in this Agreement; and an Event of Default shall “continue” or be
“continuing” until such Event of Default has been waived in writing by the
Required Lenders or all Lenders, as applicable. Any Lien referred to in this
Agreement or any of the Other Documents as having been created in favor of
Agent, any agreement entered into by Agent pursuant to this Agreement or any of
the Other Documents, any payment made by or to or funds received by Agent
pursuant to or as contemplated by this Agreement or any of the Other Documents,
or any act taken or omitted to be taken by Agent, shall, unless otherwise
expressly provided, be created, entered into, made or received, or taken or
omitted, for the benefit or account of Agent and Lenders. Wherever the phrase
“to the best of Borrowers’ knowledge” or words of similar import relating to the
knowledge or the awareness of any Borrower are used in this Agreement or Other
Documents, such phrase shall mean and refer to (i) the actual knowledge of a
senior officer of any Borrower or (ii) the knowledge that a senior officer would
have obtained if he had engaged in good faith and diligent performance of his
duties, including the making of such reasonably specific inquiries as may be
necessary of the employees or agents of such Borrower and a good faith attempt
to ascertain the existence or accuracy of the matter to which such phrase
relates. All covenants hereunder shall be given

 

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independent effect so that if a particular action or condition is not permitted
by any of such covenants, the fact that it would be permitted by an exception
to, or otherwise within the limitations of, another covenant shall not avoid the
occurrence of a default if such action is taken or condition exists. In
addition, all representations and warranties hereunder shall be given
independent effect so that if a particular representation or warranty proves to
be incorrect or is breached, the fact that another representation or warranty
concerning the same or similar subject matter is correct or is not breached will
not affect the incorrectness of a breach of a representation or warranty
hereunder.

1.5. Existing Indebtedness. This Agreement amends and restates the Existing
Agreement and the existing indebtedness under the Existing Agreement (“Existing
Indebtedness”) shall be deemed to constitute an Advance hereunder. The execution
and delivery of this Agreement and the Other Documents, however, does not
evidence or represent a refinancing, repayment, accord and/or satisfaction or
novation of the Existing Indebtedness. All of the obligations of Agent and
Lenders to Borrowers with respect to Advances to be made concurrently herewith
or after the date hereof are set forth in this Agreement. All liens and security
interests previously granted to Agent, for the benefit of Lenders, pursuant to
the Existing Loan Documents are acknowledged and reconfirmed and remain in full
force and effect and are not intended to be released, replaced or impaired.

 

II. ADVANCES, PAYMENTS.

2.1. Revolving Advances.

(a) Amount of Revolving Advances. Subject to the terms and conditions set forth
in this Agreement including Sections 2.1(b) and (c), each Lender, severally and
not jointly, will make Revolving Advances in Dollars to Borrowers in aggregate
amounts outstanding at any time equal to such Lender’s Revolving Commitment
Percentage of the lesser of (x) the Maximum Loan Amount, less the aggregate
Maximum Undrawn Amount of all outstanding Letters of Credit, less the
outstanding balance of Swing Loans, less the outstanding balance of any Fuel
Taxes that are due and owing or (y) an amount equal to the sum of:

(i) subject to the provisions of Section 2.1(c) hereof, up to 85% (“Receivables
Advance Rate”) of Eligible Receivables, Eligible Off-load Receivables, Eligible
Insured Foreign Receivables and Eligible Un-Insured Foreign Receivables, plus

(ii) subject to the provisions of Sections 2.1(b) and (c) hereof, the lesser of
(A) up to 65% of the value of Eligible In-Transit Inventory, Eligible On-Track
Inventory and Eligible In-Tank Inventory (“Inventory Advance Rate”), or (B) up
to 85% of the appraised net orderly liquidation value of Eligible In-Transit
Inventory, Eligible On-Track Inventory and Eligible In-Tank Inventory (as
evidenced by an Inventory appraisal satisfactory to Agent in its sole discretion
exercised in good faith) (the “Inventory NOLV Advance Rate”), plus

(iii) subject to the provisions of Sections 2.1(b) and (c) hereof, the lesser of
(A) up to 75% of the value of Eligible Stored Natural Gas Inventory (“Natural
Gas Inventory Advance Rate”), or (B) up to 85% of the appraised net orderly
liquidation value of Eligible Stored Natural Gas Inventory (as evidenced by an
Inventory appraisal satisfactory to Agent in its sole discretion exercised in
good faith) (the “Natural Gas Inventory NOLV Advance Rate”), plus

 

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(iv) up to 15%, subject to the provisions of Sections 2.1(b) and (c) hereof
(“Cash Advance Rate” and together with the Receivables Advance Rate, the
Inventory Advance Rate, the Inventory NOLV Advance Rate, the Natural Gas
Inventory Advance Rate, and the Natural Gas Inventory NOLV Advance Rate,
collectively, the “Advance Rates”), of the cash collections in Borrowers’
Depository Account #8026260253 maintained with Agent existing as of 1:00 p.m.
(New York time) on the Business Day in which the Formula Amount is being
calculated, minus

(v) the Availability Reserve, minus

(vi) the aggregate Maximum Undrawn Amount of all outstanding Letters of Credit,
minus

(vii) the outstanding balance of any Fuel Taxes that are due and owing plus such
other reserves as Agent may reasonably deem proper and necessary from time to
time in its Permitted Discretion.

The amount derived from the sum of (x) Sections 2.1(a)(y)(i), (ii), (iii) and
(iv) minus (y) Section 2.1 (a)(y)(v), (vi) and (vii) at any time and from time
to time shall be referred to as the “Formula Amount”. To the extent requested by
any Lender, the Revolving Advances may be evidenced by one or more amended and
restated secured promissory notes (collectively, the “Revolving Credit Note”)
substantially in the form attached hereto as Exhibit 2.1(a). Notwithstanding
anything to the contrary contained in the foregoing or otherwise in this
Agreement, the outstanding aggregate principal amount of Swing Loans and the
Revolving Advances at any one time outstanding shall not exceed an amount equal
to the lesser of (i) the Maximum Loan Amount, less the Maximum Undrawn Amount of
all outstanding Letters of Credit, less the outstanding balance of any Fuel
Taxes that are due and owing or (ii) the Formula Amount.

(b) Sublimits.

(i) The aggregate amount of Revolving Advances made to Borrowers against
Inventory specified in section 2.1(a)(y)(ii) and (iii) shall not exceed, at any
time, an amount equal to $75,000,000; provided, however, that such amount shall
be increased in connection with any Borrower Revolver Increase by an amount that
would result in such amount equaling fifty percent (50%) of the Maximum Loan
Amount;

(ii) The aggregate amount of Revolving Advances made to Borrowers against
Inventory specified in section 2.1(a)(y)(iii) shall not exceed, at any time, an
amount equal to $50,000,000; provided, however, that such amount shall be
increased in connection with any Borrower Revolver Increase by an amount that
would result in such amount equaling thirty-three and one-third percent
(33.3%) of the Maximum Loan Amount;

 

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(iii) The aggregate amount of Revolving Advances made to Borrowers against cash
collections referenced in Section 2.1(a)(y)(iv) shall not exceed, at any time,
an amount equal to $7,500,000; and

(iv) The aggregate amount of Revolving Advances made to Borrowers against
(x) Eligible Un-Insured Foreign Receivables shall not exceed, at any time, an
amount equal to $5,000,000 and (y) Eligible Insured Foreign Receivables and
Eligible Un-Insured Foreign Receivables shall not exceed, at any time, an amount
equal to $15,000,000.

(c) Discretionary Rights. The Receivables Advance Rate may be increased or
decreased by Agent at any time and from time to time in the exercise of its
Permitted Discretion. Each Borrower consents to any such increases or decreases
and acknowledges that decreasing the Receivables Advance Rate or increasing or
imposing reserves may limit or restrict Advances requested by Borrowing Agent.
The rights of Agent under this subsection are subject to the provisions of
Section 16.2(b).

2.2. Procedure for Revolving Advances Borrowing.

(a) Borrowing Agent on behalf of any Borrower may notify Agent prior to 10:00
a.m. on a Business Day of a Borrower’s request to incur, on that day, a
Revolving Advance hereunder. Should any amount required to be paid as interest
hereunder, or as fees or other charges under this Agreement or any other
agreement with Agent or Lenders, or with respect to any other Obligation, become
due, same shall be deemed a request for a Revolving Advance maintained as a
Domestic Rate Loan as of the date such payment is due, in the amount required to
pay in full such interest, fee, charge or Obligation under this Agreement or any
other agreement with Agent or Lenders, and such request shall be irrevocable.

(b) Notwithstanding the provisions of subsection (a) above, in the event any
Borrower desires to obtain a Eurodollar Rate Loan for any Advance (other than a
Swing Loan, which may not be a Eurodollar Rate Loan), Borrowing Agent shall give
Agent written notice by no later than 10:00 a.m. on the day which is three
(3) Business Days prior to the date such Eurodollar Rate Loan is to be borrowed,
specifying (i) the date of the proposed borrowing (which shall be a Business
Day), (ii) the type of borrowing and the amount on the date of such Advance to
be borrowed, which amount shall be in a minimum amount of $500,000 and in
integral multiples of $500,000 thereafter, and (iii) the duration of the first
Interest Period therefor. Interest Periods for Eurodollar Rate Loans shall be
for one or three months; provided, if an Interest Period would end on a day that
is not a Business Day, it shall end on the next succeeding Business Day unless
such day falls in the next succeeding calendar month in which case the Interest
Period shall end on the next preceding Business Day. No Eurodollar Rate Loan
shall be made available to any Borrower during the continuance of a Default or
an Event of Default. After giving effect to each requested Eurodollar Rate Loan,
including those which are converted from a Domestic Rate Loan under
Section 2.2(d), there shall not be outstanding more than five (5) Eurodollar
Rate Loans, in the aggregate.

(c) Each Interest Period of a Eurodollar Rate Loan shall commence on the date
such Eurodollar Rate Loan is made and shall end on such date as Borrowing Agent
may elect as set forth in subsection (b)(iii) above provided that the exact
length of each Interest Period

 

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shall be determined in accordance with the practice of the interbank market for
offshore Dollar deposits and no Interest Period shall end after the last day of
the Term. Borrowing Agent shall elect the initial Interest Period applicable to
a Eurodollar Rate Loan by its notice of borrowing given to Agent pursuant to
Section 2.2(b) or by its notice of conversion given to Agent pursuant to
Section 2.2(d), as the case may be. Borrowing Agent shall elect the duration of
each succeeding Interest Period by giving irrevocable written notice to Agent of
such duration not later than 10:00 a.m. on the day which is three (3) Business
Days prior to the last day of the then current Interest Period applicable to
such Eurodollar Rate Loan. If Agent does not receive timely notice of the
Interest Period elected by Borrowing Agent, Borrowing Agent shall be deemed to
have elected to convert to a Domestic Rate Loan subject to Section 2.2(d)
hereinbelow.

(d) Provided that no Event of Default shall have occurred and be continuing,
Borrowing Agent may, on the last Business Day of the then current Interest
Period applicable to any outstanding Eurodollar Rate Loan, or on any Business
Day with respect to Domestic Rate Loans, convert any such loan into a loan of
another type in the same aggregate principal amount provided that any conversion
of a Eurodollar Rate Loan shall be made only on the last Business Day of the
then current Interest Period applicable to such Eurodollar Rate Loan. If
Borrowing Agent desires to convert a loan, Borrowing Agent shall give Agent
written notice by no later than 10:00 a.m. (i) on the day which is three
(3) Business Days’ prior to the date on which such conversion is to occur with
respect to a conversion from a Domestic Rate Loan to a Eurodollar Rate Loan, or
(ii) on the day which is one (1) Business Day prior to the date on which such
conversion is to occur with respect to a conversion from a Eurodollar Rate Loan
to a Domestic Rate Loan, specifying, in each case, the date of such conversion,
the loans to be converted and if the conversion is from a Domestic Rate Loan to
any other type of loan, the duration of the first Interest Period therefor.

(e) At its option and upon written notice given prior to 10:00 a.m. (New York
time) at least three (3) Business Days’ prior to the date of such prepayment,
any Borrower may prepay the Eurodollar Rate Loans in whole at any time or in
part from time to time with accrued interest on the principal being prepaid to
the date of such repayment. Such Borrower shall specify the date of prepayment
of Advances which are Eurodollar Rate Loans and the amount of such prepayment.
In the event that any prepayment of a Eurodollar Rate Loan is required or
permitted on a date other than the last Business Day of the then current
Interest Period with respect thereto, such Borrower shall indemnify Agent and
Lenders therefor in accordance with Section 2.2(f) hereof.

(f) Each Borrower shall indemnify Agent and Lenders and hold Agent and Lenders
harmless from and against any and all losses or expenses that Agent and Lenders
may sustain or incur as a consequence of any prepayment, conversion of or any
default by any Borrower in the payment of the principal of or interest on any
Eurodollar Rate Loan or failure by any Borrower to complete a borrowing of, a
prepayment of or conversion of or to a Eurodollar Rate Loan after notice thereof
has been given, including, but not limited to, any interest payable by Agent or
Lenders to lenders of funds obtained by it in order to make or maintain its
Eurodollar Rate Loans hereunder. A certificate as to any additional amounts
payable pursuant to the foregoing sentence submitted by Agent or any Lender to
Borrowing Agent shall be conclusive absent manifest error.

 

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(g) Notwithstanding any other provision hereof, if any Applicable Law, treaty,
regulation or directive, or any change therein or in the interpretation or
application thereof, including without limitation any Change in Law, shall make
it unlawful for Lenders or any Lender (for purposes of this subsection (g), the
term “Lender” shall include any Lender and the office or branch where any Lender
or any Person controlling such Lender makes or maintains any Eurodollar Rate
Loans) to make or maintain its Eurodollar Rate Loans, the obligation of Lenders
(or such affected Lender) to make Eurodollar Rate Loans hereunder shall
forthwith be cancelled and Borrowers shall, if any affected Eurodollar Rate
Loans are then outstanding, promptly upon request from Agent, either pay all
such affected Eurodollar Rate Loans or convert such affected Eurodollar Rate
Loans into loans of another type. If any such payment or conversion of any
Eurodollar Rate Loan is made on a day that is not the last day of the Interest
Period applicable to such Eurodollar Rate Loan, Borrowers shall pay Agent, upon
Agent’s request, such amount or amounts as may be necessary to compensate
Lenders for any loss or expense sustained or incurred by Lenders in respect of
such Eurodollar Rate Loan as a result of such payment or conversion, including
(but not limited to) any interest or other amounts payable by Lenders to lenders
of funds obtained by Lenders in order to make or maintain such Eurodollar Rate
Loan. A certificate as to any additional amounts payable pursuant to the
foregoing sentence submitted by Lenders to Borrowing Agent shall be conclusive
absent manifest error.

2.3. Disbursement of Advance Proceeds. All Advances shall be disbursed from
whichever office or other place Agent may designate from time to time and,
together with any and all other Obligations of Borrowers to Agent or Lenders,
shall be charged to Borrowers’ Account on Agent’s books. During the Term,
Borrowers may use the Revolving Advances and Swing Loans by borrowing, prepaying
and reborrowing, all in accordance with the terms and conditions hereof. The
proceeds of each Revolving Advance requested by Borrowing Agent on behalf of any
Borrower or deemed to have been requested by any Borrower under Section 2.2(a)
hereof shall, with respect to requested Revolving Advances to the extent Lenders
make such Revolving Advances, be made available to the applicable Borrower on
the day so requested by way of credit to such Borrower’s operating account at
PNC, or such other bank as Borrowing Agent may designate following notification
to Agent, in immediately available federal funds or other immediately available
funds or, with respect to Revolving Advances deemed to have been requested by
any Borrower, be disbursed to Agent to be applied to the outstanding Obligations
giving rise to such deemed request. The proceeds of each Swing Loan requested by
Borrowing Agent on behalf of any Borrower shall be made available to the
applicable Borrower on the day so requested by way of credit to such Borrower’s
operating account at PNC, or such other bank as Borrowing Agent may designate
following notification to Agent, in immediately available federal funds or other
immediately available funds.

2.4. Swing Loans.

(a) Subject to the terms and conditions set forth in this Agreement, and in
order to minimize the transfer of funds between Lenders and Agent for
administrative convenience, Agent, the Lenders holding Revolving Commitments and
Swing Loan Lender agree that in order to facilitate the administration of this
Agreement, Swing Loan Lender may, at its election and option made in its sole
discretion cancelable at any time for any reason whatsoever, make swing loan
advances (“Swing Loans”) available to Borrowers as provided for in this
Section 2.4 at any time or from time to time after the date hereof to, but not
including, the

 

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expiration of the Term, in an aggregate principal amount up to but not in excess
of the Maximum Swing Loan Advance Amount, provided that the outstanding
aggregate principal amount of Swing Loans and the Revolving Advances at any one
time outstanding shall not exceed an amount equal to the lesser of (i) the
Maximum Loan Amount, less the Maximum Undrawn Amount of all outstanding Letters
of Credit, less the outstanding balance of any Fuel Taxes that are due and owing
or (ii) the Formula Amount. All Swing Loans shall be Domestic Rate Loans only.
Borrowers may borrow (at the option and election of Swing Loan Lender), repay
and reborrow (at the option and election of Swing Loan Lender) Swing Loans and
Swing Loan Lender may make Swing Loans as provided in this Section 2.4 during
the period between Settlement Dates. All Swing Loans shall be evidenced by a
secured promissory note (the “Swing Loan Note”) substantially in the form
attached hereto as Exhibit 2.4(a). Swing Loan Lender’s agreement to make Swing
Loans under this Agreement is cancelable at any time for any reason whatsoever
and the making of Swing Loans by Swing Loan Lender from time to time shall not
create any duty or obligation, or establish any course of conduct, pursuant to
which Swing Loan Lender shall thereafter be obligated to make Swing Loans in the
future

(b) Upon either (x) any request by Borrowing Agent for a Revolving Advance made
pursuant to Section 2.2(a) hereof or (y) the occurrence of any deemed request by
Borrowers for a Revolving Advance pursuant to the provisions of the last
sentence of Section 2.2(a) hereof, Swing Loan Lender may elect, in its sole
discretion, to have such request or deemed request treated as a request for a
Swing Loan, and may advance same day funds to Borrowers as a Swing Loan;
provided that notwithstanding anything to the contrary provided for herein,
Swing Loan Lender may not make Swing Loan Advances if Swing Loan Lender has been
notified by Agent or by Required Lenders that one or more of the applicable
conditions set forth in Section 8.2 of this Agreement have not been satisfied or
the Revolving Commitments have been terminated for any reason.

(c) Upon the making of a Swing Loan (whether before or after the occurrence of a
Default or Event of Default and regardless of whether a Settlement has been
requested with respect to such Swing Loan), each Lender holding a Revolving
Commitment shall be deemed, without further action by any party hereto, to have
unconditionally and irrevocably purchased from Swing Loan Lender, without
recourse or warranty, an undivided interest and participation in such Swing Loan
in proportion to its Revolving Commitment Percentage. Swing Loan Lender or Agent
may, at any time, require the Lenders holding Revolving Commitments to fund such
participations by means of a Settlement as provided for in Section 2.20(c)
below. From and after the date, if any, on which any Lender holding a Revolving
Commitment is required to fund, and funds, its participation in any Swing Loans
purchased hereunder, Agent shall promptly distribute to such Lender its
Revolving Commitment Percentage of all payments of principal and interest and
all proceeds of Collateral received by Agent in respect of such Swing Loan;
provided that no Lender holding a Revolving Commitment shall be obligated in any
event to make Revolving Advances in an amount in excess of its Revolving
Commitment Amount minus its Participation Commitment of the Maximum Undrawn
Amount of all outstanding Letters of Credit.

2.5. Maximum Advances. The aggregate balance of Revolving Advances plus Swing
Loans outstanding at any time shall not exceed the lesser of (a) the Maximum
Loan Amount less the Maximum Undrawn Amount of all issued and outstanding
Letters of Credit less the outstanding balance of any Fuel Taxes that are due
and owing or (b) the Formula Amount.

 

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2.6. Repayment of Advances.

(a) The Revolving Advances and Swing Loans shall be due and payable in full on
the last day of the Term subject to earlier prepayment as herein provided.

(b) Each Borrower recognizes that the amounts evidenced by checks, notes, drafts
or any other items of payment relating to and/or proceeds of Collateral may not
be collectible by Agent on the date received. In consideration of Agent’s
agreement to conditionally credit Borrowers’ Account as of the next Business Day
following Agent’s receipt of those items of payment, each Borrower agrees that,
in computing the charges under this Agreement, all items of payment shall be
deemed applied by Agent on account of the Obligations one (1) Business Day after
(i) the Business Day following Agent’s receipt of such payments via wire
transfer or electronic depository check or (ii) in the case of payments received
by Agent in any other form, the Business Day such payment constitutes good funds
in Agent’s account. Agent is not, however, required to credit Borrowers’ Account
for the amount of any item of payment which is unsatisfactory to Agent and Agent
may charge Borrowers’ Account for the amount of any item of payment which is
returned to Agent unpaid.

(c) All payments of principal, interest and other amounts payable hereunder, or
under any of the Other Documents shall be made to Agent at the Payment Office by
wire transfer not later than 1:00 P.M. (New York time) on the due date therefor
in lawful money of the United States of America in federal funds or other funds
immediately available to Agent. Agent shall have the right to effectuate payment
on any and all Obligations due and owing hereunder by charging Borrowers’
Account or by making Advances as provided in Section 2.2 hereof.

(d) Borrowers shall pay principal, interest, and all other amounts payable
hereunder, or under any related agreement, without any deduction whatsoever,
including, but not limited to, any deduction for any setoff or counterclaim.

2.7. Repayment of Excess Advances. The aggregate balance of Advances outstanding
at any time in excess of the maximum amount of Advances permitted hereunder
shall be immediately due and payable without the necessity of any demand, at the
Payment Office, whether or not a Default or Event of Default has occurred.

2.8. Statement of Account. Agent shall maintain, in accordance with its
customary procedures, a loan account (“Borrowers’ Account”) in the name of
Borrowers in which shall be recorded the date and amount of each Advance made by
Agent and the date and amount of each payment in respect thereof; provided,
however, the failure by Agent to record the date and amount of any Advance shall
not adversely affect Agent or any Lender. Each month, Agent shall send to
Borrowing Agent a statement showing the accounting for the Advances made,
payments made or credited in respect thereof, and other transactions between
Agent and Borrowers during such month. The monthly statements shall be deemed
correct and binding upon Borrowers in the absence of manifest error and shall
constitute an account stated between Lenders and Borrowers unless Agent receives
a written statement of Borrowers’ specific exceptions thereto within thirty
(30) days after such statement is received by Borrowing Agent. The records of
Agent with respect to the loan account shall be conclusive evidence absent
manifest error of the amounts of Advances and other charges thereto and of
payments applicable thereto.

 

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2.9. Letters of Credit. Subject to the terms and conditions hereof, Agent shall
issue or cause the issuance of standby and/or trade Letters of Credit (“Letters
of Credit”) for the account of any Borrower; provided, however, that Agent will
not be required to issue or cause to be issued any Letters of Credit to the
extent that the issuance thereof would then cause the sum of (i) the outstanding
Revolving Advances and Swing Loans plus (ii) the Maximum Undrawn Amount of all
outstanding Letters of Credit to exceed the lesser of (x) the Maximum Loan
Amount less the outstanding balance of any Fuel Taxes that are due and owing or
(y) the Formula Amount (calculated without giving effect to the deductions
provided for in Section 2.1(a)(y)(vi)). The Maximum Undrawn Amount of
outstanding Letters of Credit shall not exceed in the aggregate at any time the
Letter of Credit Sublimit. All disbursements or payments related to Letters of
Credit shall be deemed to be Domestic Rate Loans consisting of Revolving
Advances and shall bear interest at the Revolving Interest Rate for Domestic
Rate Loans; Letters of Credit that have not been drawn upon shall not bear
interest.

2.10. Issuance of Letters of Credit.

(a) Borrowing Agent, on behalf of Borrowers, may request Agent to issue or cause
the issuance of a Letter of Credit by delivering to Agent at the Payment Office,
prior to 10:00 a.m. (New York time), at least five (5) Business Days’ prior to
the proposed date of issuance, Agent’s form of Letter of Credit Application (the
“Letter of Credit Application”) completed to the satisfaction of Agent; and,
such other certificates, documents and other papers and information as Agent may
reasonably request. Borrowing Agent, on behalf of Borrowers, also has the right
to give instructions and make agreements with respect to any application, any
applicable letter of credit and security agreement, any applicable letter of
credit reimbursement agreement and/or any other applicable agreement, any letter
of credit and the disposition of documents, disposition of any unutilized funds,
and to agree with Agent upon any amendment, extension or renewal of any Letter
of Credit.

(b) Each Letter of Credit shall, among other things, (i) provide for the payment
of sight drafts, other written demands for payment, or acceptances of usance
drafts when presented for honor thereunder in accordance with the terms thereof
and when accompanied by the documents described therein and (ii) have an expiry
date not later than twelve (12) months after such Letter of Credit’s date of
issuance and in no event later than the last day of the Term. Each standby
Letter of Credit shall be subject either to the Uniform Customs and Practice for
Documentary Credits as most recently published by the International Chamber of
Commerce at the time the Letter of Credit is issued (“UCP”) or the International
Standby Practices (ISP98-International Chamber of Commerce Publication Number
590) (“ISP98 Rules”), and any subsequent revision thereof at the time a standby
Letter of Credit is issued, as determined by Agent, and each trade Letter of
Credit shall be subject to the UCP.

(c) Agent shall use its reasonable efforts to notify Lenders of the request by
Borrowing Agent for a Letter of Credit hereunder.

(d) Notwithstanding anything to the contrary set forth in Section 2.10(b) or

 

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any other provision of this Agreement, Borrowers may request and Agent (or any
other Issuer) may issue Letters of Credit (and/or renewals or extensions of
existing Letters of Credit) under this Agreement with an expiry date that
extends beyond the last day of the Term as then in effect when such Letter of
Credit (or the extension or renewal thereof) is requested (any such Letter of
Credit so issued, renewed or extended, a “Post-Term Letter of Credit”), subject
to all other existing terms and conditions of and provisions in this Agreement
regarding Letters of Credit, including any terms, conditions and provisions
regarding the requesting and issuance thereof, but provided that, under no
circumstances may any such Post-Term Letter of Credit as so issued, renewed or
extended have an expiry date later than the twelve-month anniversary of the last
day of the Term as in effect when such Post-Term Letter of Credit is so issued,
renewed or extended.

(e) All of the obligations, liabilities and indebtedness of any kind or nature
of Borrowers with respect to any and all such Post-Term Letter of Credits
(including all reimbursement obligations and obligations to pay Letter of Credit
Fees and obligations to pay interest in respect of any disbursement made by
Agent in connection with a drawing under a Post-Term Letter of Credit that is
not immediately reimbursed by Borrowers (including any such fees, charges and
interest accruing thereon after the last day of the Term, or after the filing of
any petition in bankruptcy, or the commencement of any insolvency,
reorganization or like proceeding relating to Borrowers, whether or not a claim
for post-filing or post-petition fees, charges and interest is allowed in such
proceeding)) (any such obligations, liabilities and indebtedness, the “Post-Term
Letter of Credit Obligations”) shall remain Obligations of Borrowers secured by
the Collateral pursuant to the Liens created under this Agreement and the Other
Documents both prior to and after the expiration of the Term, and Agent and
Lenders shall have no obligations to release any Liens on the Collateral
notwithstanding the overall termination of this Agreement and of the commitments
of the Lenders with respect to Revolving Advances, until such time as the last
such Post-Term Letter of Credit shall have expired or terminated or shall been
fully drawn and all Post-Term Letter of Credit Obligations (other than
contingent indemnities and expense reimbursement obligations to the extent no
claim therefore has been made, or is reasonably expected to be made) have been
paid in full in cash, provided that, notwithstanding the foregoing, on the last
day of the Term, Borrowers may provide cash collateral (any such cash
collateral, the “Post-Term Cash Collateral”) to Agent to be held as security for
such Post-Term Letter of Credit Obligations (and Borrowers hereby grant to Agent
a Lien and security interest in any such Post-Term Cash Collateral so provided)
in an amount equal to one hundred and ten percent (110%) of the then-outstanding
undrawn face amount of all such Post-Term Letters of Credit plus the amount of
all Letter of Credit Fees that would accrue with respect to such Post-Term
Letters of Credit from and after the last day of the Term through the expiry
date as then in effect for each such Post Term Letter of Credit, and in such
event, if all other Obligations (other than contingent indemnities and expense
reimbursement obligations to the extent no claim therefore has been made, or is
reasonably expected to be made) have been paid in full in cash, Agent and
Lenders will agree to release the Liens and security interests on all other
Collateral (subject to customary payoff releases and indemnities) in accordance
with this Agreement. Agent will invest such cash collateral (less applicable
reserves) in such short-term money-market items as to which Agent and Borrowers
mutually agree and the net return on such investments shall be credited to such
account and constitute additional cash collateral. Borrowers agree that upon the
coming due of any such Post-Term Letter of Credit obligations, Agent may use
such Post-Term Cash Collateral to pay and satisfy such Post-Term Letter of
Credit Obligations.

 

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(f) Notwithstanding anything to the contrary contained in this Agreement and/or
the overall termination of this Agreement on the last day of the Term (subject
to the survival of the provisions thereof that survive the termination of this
Agreement by the terms thereof), all of the applicable provisions of Article II,
Sections 2.9, 2.10, 2.11 and Section 3.2 of this Agreement, any Letter of Credit
application for any Post-Term Letter of Credit and any other documents executed
by and/or between Borrowers, Agent and/or Issuer with respect to any Post-Term
Letter of Credit (other than any provisions giving Borrowers the right or
ability to request that additional Letters of Credit be issued or that existing
Letters of Credit be renewed or extended) shall survive the termination of this
Agreement on the last day of the Term for the benefit of Agent and Lenders (but
not for the benefit of Borrowers), and Borrowers shall remain bound thereby,
including without limitation of the obligations under Section 3.2 of this
Agreement for Borrowers to pay Letter of Credit Fees to Agent and Issuer with
respect to any Post-Term Letter of Credit for so long as each Post-Term Letter
of Credit shall remain outstanding and the obligations under Section 2.9 for
Borrowers to pay interest on any disbursements or payments made by Agent and/or
Issuer relating to any Post-Term Letter of Credit until reimbursed.

(g) Nothing contained in this Agreement shall be construed under any
circumstances as an agreement by Agent and/or Lenders to extend the Term or
require or obligate in any way Agent, Lenders and/or Issuer to make any
Revolving Advances or to issue any new Letters of Credit (or extend or renew any
existing Letters of Credit) on or after the last day of the Term.

2.11. Requirements For Issuance of Letters of Credit.

(a) Borrowing Agent shall authorize and direct any Issuer to name the applicable
Borrower as the “Applicant” or “Account Party” of each Letter of Credit. If
Agent is not the Issuer of any Letter of Credit, Borrowing Agent shall authorize
and direct the Issuer to deliver to Agent all instruments, documents, and other
writings and property received by the Issuer pursuant to the Letter of Credit
and to accept and rely upon Agent’s instructions and agreements with respect to
all matters arising in connection with the Letter of Credit, the application
therefor.

(b) In connection with all Letters of Credit issued or caused to be issued by
Agent under this Agreement, each Borrower hereby appoints Agent, or its
designee, as its attorney, with full power and authority if an Event of Default
shall have occurred, (i) to sign and/or endorse such Borrower’s name upon any
warehouse or other receipts, letter of credit applications and acceptances,
(ii) to sign such Borrower’s name on bills of lading; (iii) to clear Inventory
through the United States of America Customs Department (“Customs”) in the name
of such Borrower or Agent or Agent’s designee, and to sign and deliver to
Customs officials powers of attorney in the name of Borrower for such purpose;
and (iv) to complete in such Borrower’s name or Agent’s, or in the name of
Agent’s designee, any order, sale or transaction, obtain the necessary documents
in connection therewith, and collect the proceeds thereof. Neither Agent nor its
attorneys will be liable for any acts or omissions nor for any error of judgment
or mistakes of fact or law, except for Agent’s or its attorney’s willful
misconduct. This power, being coupled with an interest, is irrevocable as long
as any Letters of Credit remain outstanding.

 

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2.12. Disbursements, Reimbursement.

(a) Immediately upon the issuance of each Letter of Credit, each Lender shall be
deemed to, and hereby irrevocably and unconditionally agrees to, purchase from
Agent a participation in such Letter of Credit and each drawing thereunder in an
amount equal to such Lender’s Revolving Commitment Percentage of the Maximum
Face Amount of such Letter of Credit and the amount of such drawing,
respectively.

(b) In the event of any request for a drawing under a Letter of Credit by the
beneficiary or transferee thereof, Agent will promptly notify Borrowing Agent.
Provided that Borrowing Agent shall have received such notice, the Borrowers
shall reimburse (such obligation to reimburse Agent shall sometimes be referred
to as a “Reimbursement Obligation”) Agent prior to 12:00 Noon, New York time on
each date that an amount is paid by Agent under any Letter of Credit (each such
date, a “Drawing Date”) in an amount equal to the amount so paid by Agent. In
the event Borrowers fail to reimburse Agent for the full amount of any drawing
under any Letter of Credit by 12:00 Noon, New York time, on the Drawing Date,
Agent will promptly notify each Lender thereof, and Borrowers shall be deemed to
have requested that a Domestic Rate Loan be made by the Lenders to be disbursed
on the Drawing Date under such Letter of Credit, subject to the amount of the
unutilized portion of the lesser of the Maximum Loan Amount, less the Maximum
Undrawn Amount or the Formula Amount and subject to Section 8.2 hereof. Any
notice given by Agent pursuant to this Section 2.12(b) may be oral if
immediately confirmed in writing; provided that the lack of such an immediate
confirmation shall not affect the conclusiveness or binding effect of such
notice.

(c) Each Lender shall upon any notice pursuant to Section 2.12(b) make available
to Agent an amount in immediately available funds equal to its Revolving
Commitment Percentage of the amount of the drawing, whereupon the participating
Lenders shall (subject to Section 2.12(d)) each be deemed to have made a
Domestic Rate Loan to Borrowers in that amount. If any Lender so notified fails
to make available to Agent the amount of such Lender’s Revolving Commitment
Percentage of such amount by no later than 2:00 p.m., New York time on the
Drawing Date, then interest shall accrue on such Lender’s obligation to make
such payment, from the Drawing Date to the date on which such Lender makes such
payment (i) at a rate per annum equal to the Federal Funds Effective Rate during
the first three days following the Drawing Date and (ii) at a rate per annum
equal to the rate applicable to Domestic Rate Loans on and after the fourth day
following the Drawing Date. Agent will promptly give notice of the occurrence of
the Drawing Date, but failure of Agent to give any such notice on the Drawing
Date or in sufficient time to enable any Lender to effect such payment on such
date shall not relieve such Lender from its obligation under this
Section 2.12(c), provided that such Lender shall not be obligated to pay
interest as provided in Section 2.12(c) (i) and (ii) until and commencing from
the date of receipt of notice from Agent of a drawing.

(d) With respect to any unreimbursed drawing that is not converted into a
Domestic Rate Loan to Borrowers in whole or in part as contemplated by
Section 2.12(b), because of Borrowers’ failure to satisfy the conditions set
forth in Section 8.2 (other than any notice requirements) or for any other
reason, Borrowers shall be deemed to have incurred from Agent a borrowing (each
a “Letter of Credit Borrowing”) in the amount of such drawing. Such Letter of
Credit Borrowing shall be due and payable on demand (together with interest) and
shall

 

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bear interest at the rate per annum applicable to a Domestic Rate Loan. Each
Lender’s payment to Agent pursuant to Section 2.12(c) shall be deemed to be a
payment in respect of its participation in such Letter of Credit Borrowing and
shall constitute a “Participation Advance” from such Lender in satisfaction of
its Participation Commitment under this Section 2.12.

(e) Each Lender’s Participation Commitment shall continue until the last to
occur of any of the following events: (x) Agent ceases to be obligated to issue
or cause to be issued Letters of Credit hereunder; (y) no Letter of Credit
issued or created hereunder remains outstanding and uncancelled; and (z) all
Persons (other than the Borrowers) have been fully reimbursed for all payments
made under or relating to Letters of Credit.

2.13. Repayment of Participation Advances.

(a) Upon (and only upon) receipt by Agent for its account of immediately
available funds from Borrowers (i) in reimbursement of any payment made by the
Agent under the Letter of Credit with respect to which any Lender has made a
Participation Advance to Agent, or (ii) in payment of interest on such a payment
made by Agent under such a Letter of Credit, Agent will pay to each Lender, in
the same funds as those received by Agent, the amount of such Lender’s Revolving
Commitment Percentage of such funds, except Agent shall retain the amount of the
Revolving Commitment Percentage of such funds of any Lender that did not make a
Participation Advance in respect of such payment by Agent (and, to the extent
that any of the other Lender(s) holding a Revolving Commitment have funded any
portion of such Defaulting Lender’s Participation Advance in accordance with the
provisions of Section 2.23, Agent will pay over to such Non-Defaulting funding
Lenders a pro rata portion of the funds so withheld from such Defaulting
Lender).

(b) If Agent is required at any time to return to any Borrower, or to a trustee,
receiver, liquidator, custodian, or any official in any insolvency proceeding,
any portion of the payments made by Borrowers to Agent pursuant to
Section 2.13(a) in reimbursement of a payment made under the Letter of Credit or
interest or fee thereon, each Lender shall, on demand of Agent, forthwith return
to Agent the amount of its Revolving Commitment Percentage of any amounts so
returned by Agent plus interest at the Federal Funds Effective Rate.

2.14. Documentation. Each Borrower agrees to be bound by the terms of the Letter
of Credit Application and by Agent’s interpretations of any Letter of Credit
issued on behalf of such Borrower and by Agent’s written regulations and
customary practices relating to letters of credit, though Agent’s
interpretations may be different from such Borrower’s own. In the event of a
conflict between the Letter of Credit Application and this Agreement, this
Agreement shall govern. It is understood and agreed that, except in the case of
gross negligence or willful misconduct (as determined by a court of competent
jurisdiction in a final non-appealable judgment), Agent shall not be liable for
any error, negligence and/or mistakes, whether of omission or commission, in
following the Borrowing Agent’s or any Borrower’s instructions or those
contained in the Letters of Credit or any modifications, amendments or
supplements thereto.

2.15. Determination to Honor Drawing Request. In determining whether to honor
any request for drawing under any Letter of Credit by the beneficiary thereof,
Agent shall be

 

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responsible only to determine that the documents and certificates required to be
delivered under such Letter of Credit have been delivered and that they comply
on their face with the requirements of such Letter of Credit and that any other
drawing condition appearing on the face of such Letter of Credit has been
satisfied in the manner so set forth.

2.16. Nature of Participation and Reimbursement Obligations. Each Lender’s
obligation in accordance with this Agreement to make the Revolving Advances or
Participation Advances as a result of a drawing under a Letter of Credit, and
the obligations of Borrowers to reimburse Agent upon a draw under a Letter of
Credit, shall be absolute, unconditional and irrevocable, and shall be performed
strictly in accordance with the terms of this Section 2.16 under all
circumstances (other than the obligation to make Revolving Advances or
Participation Advances by any Lender as a result of the gross negligence or
willful misconduct of Agent), including the following circumstances:

(i) any set-off, counterclaim, recoupment, defense or other right which such
Lender may have against Agent, any Borrower or any other Person for any reason
whatsoever;

(ii) the failure of any Borrower or any other Person to comply, in connection
with a Letter of Credit Borrowing, with the conditions set forth in this
Agreement for the making of a Revolving Advance, it being acknowledged that such
conditions are not required for the making of a Letter of Credit Borrowing and
the obligation of the Lenders to make Participation Advances under Section 2.12;

(iii) any lack of validity or enforceability of any Letter of Credit;

(iv) any claim of breach of warranty that might be made by Borrower or any
Lender against the beneficiary of a Letter of Credit, or the existence of any
claim, set-off, recoupment, counterclaim, crossclaim, defense or other right
which any Borrower or any Lender may have at any time against a beneficiary, any
successor beneficiary or any transferee of any Letter of Credit or the proceeds
thereof (or any Persons for whom any such transferee may be acting), Agent or
any Lender or any other Person, whether in connection with this Agreement, the
transactions contemplated herein or any unrelated transaction (including any
underlying transaction between any Borrower or any Subsidiaries of such Borrower
and the beneficiary for which any Letter of Credit was procured);

(v) the lack of power or authority of any signer of (or any defect in or forgery
of any signature or endorsement on) or the form of or lack of validity,
sufficiency, accuracy, enforceability or genuineness of any draft, demand,
instrument, certificate or other document presented under or in connection with
any Letter of Credit, or any fraud or alleged fraud in connection with any
Letter of Credit, or the transport of any property or provisions of services
relating to a Letter of Credit, in each case even if Agent or any of Agent’s
Affiliates has been notified thereof;

(vi) payment by Agent under any Letter of Credit against presentation of a
demand, draft or certificate or other document which does not comply with the
terms of such Letter of Credit;

 

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(vii) the solvency of, or any acts or omissions by, any beneficiary of any
Letter of Credit, or any other Person having a role in any transaction or
obligation relating to a Letter of Credit, or the existence, nature, quality,
quantity, condition, value or other characteristic of any property or services
relating to a Letter of Credit;

(viii) any failure by the Agent or any of Agent’s Affiliates to issue any Letter
of Credit in the form requested by Borrowing Agent, unless the Agent has
received written notice from Borrowing Agent of such failure within three
(3) Business Days after the Agent shall have furnished Borrowing Agent a copy of
such Letter of Credit and such error is material and no drawing has been made
thereon prior to receipt of such notice;

(ix) any Material Adverse Effect on any Borrower or any Guarantor;

(x) any breach of this Agreement or any Other Document by any party thereto;

(xi) the occurrence or continuance of an insolvency proceeding with respect to
any Borrower or any Guarantor;

(xii) the fact that a Default or Event of Default shall have occurred and be
continuing;

(xiii) the fact that the Term shall have expired or this Agreement or the
Obligations hereunder shall have been terminated; and

(xiv) any other circumstance or happening whatsoever, whether or not similar to
any of the foregoing.

2.17. Indemnity. In addition to amounts payable as provided in Section 16.5,
each Borrower hereby agrees to protect, indemnify, pay and save harmless Agent,
any of Agent’s Affiliates and Issuer that have issued a Letter of Credit from
and against any and all claims, demands, liabilities, damages, taxes, penalties,
interest, judgments, losses, costs, charges and expenses (including reasonable
fees, expenses and disbursements of counsel and allocated costs of internal
counsel) which the Agent, any of Agent’s Affiliates or Issuer may incur or be
subject to as a consequence, direct or indirect, of the issuance of any Letter
of Credit, other than as a result of (a) the gross negligence or willful
misconduct of the Agent or Issuer as determined by a final and non-appealable
judgment of a court of competent jurisdiction or (b) the wrongful dishonor by
the Agent. any of Agent’s Affiliates or Issuer of a proper demand for payment
made under any Letter of Credit, except if such dishonor resulted from any act
or omission, whether rightful or wrongful, of any present or future de jure or
de facto Governmental Body (all such acts or omissions herein called
“Governmental Acts”).

2.18. Liability for Acts and Omissions. As between Borrowers and Agent, Swing
Loan Lender and Lenders, each Borrower assumes all risks of the acts and
omissions of, or misuse of the Letters of Credit by, the respective
beneficiaries of such Letters of Credit. In furtherance and not in limitation of
the respective foregoing, Agent shall not be responsible for: (i) the form,
validity, sufficiency, accuracy, genuineness or legal effect of any document
submitted by any party in connection with the application for an issuance of any
such Letter of Credit, even if it

 

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should in fact prove to be in any or all respects invalid, insufficient,
inaccurate, fraudulent or forged (even if Agent shall have been notified
thereof); (ii) the validity or sufficiency of any instrument transferring or
assigning or purporting to transfer or assign any such Letter of Credit or the
rights or benefits thereunder or proceeds thereof, in whole or in part, which
may prove to be invalid or ineffective for any reason; (iii) the failure of the
beneficiary of any such Letter of Credit, or any other party to which such
Letter of Credit may be transferred, to comply fully with any conditions
required in order to draw upon such Letter of Credit or any other claim of any
Borrower against any beneficiary of such Letter of Credit, or any such
transferee, or any dispute between or among any Borrower and any beneficiary of
any Letter of Credit or any such transferee; (iv) errors, omissions,
interruptions or delays in transmission or delivery of any messages, by mail,
cable, facsimile, telex or otherwise, whether or not they be in cipher;
(v) errors in interpretation of technical terms; (vi) any loss or delay in the
transmission or otherwise of any document required in order to make a drawing
under any such Letter of Credit or of the proceeds thereof; (vii) the
misapplication by the beneficiary of any such Letter of Credit of the proceeds
of any drawing under such Letter of Credit; or (viii) any consequences arising
from causes beyond the control of Agent, including any governmental acts, and
none of the above shall affect or impair, or prevent the vesting of, any of
Agent’s rights or powers hereunder. Nothing in the preceding sentence shall
relieve Agent from liability for Agent’s gross negligence or willful misconduct
(as determined by a court of competent jurisdiction in a final non-appealable
judgment) in connection with actions or omissions described in such clauses
(i) through (viii) of such sentence. In no event shall Agent or Agent’s
Affiliates be liable to any Borrower for any indirect, consequential,
incidental, punitive, exemplary or special damages or expenses (including
without limitation attorneys’ fees), or for any damages resulting from any
change in the value of any property relating to a Letter of Credit.

Without limiting the generality of the foregoing, Agent and each of its
Affiliates (i) may rely on any oral or other communication believed in good
faith by Agent or such Affiliate to have been authorized or given by or on
behalf of the applicant for a Letter of Credit, (ii) may honor any presentation
if the documents presented appear on their face substantially to comply with the
terms and conditions of the relevant Letter of Credit; (iii) may honor a
previously dishonored presentation under a Letter of Credit, whether such
dishonor was pursuant to a court order, to settle or compromise any claim of
wrongful dishonor, or otherwise, and shall be entitled to reimbursement to the
same extent as if such presentation had initially been honored, together with
any interest paid by Agent or its Affiliates; (iv) may honor any drawing that is
payable upon presentation of a statement advising negotiation or payment, upon
receipt of such statement (even if such statement indicates that a draft or
other document is being delivered separately), and shall not be liable for any
failure of any such draft or other document to arrive, or to conform in any way
with the relevant Letter of Credit; (v) may pay any paying or negotiating bank
claiming that it rightfully honored under the laws or practices of the place
where such bank is located; and (vi) may settle or adjust any claim or demand
made on Agent or its Affiliate in any way related to any order issued at the
applicant’s request to an air carrier, a letter of guarantee or of indemnity
issued to a carrier or any similar document (each an “Order”) and honor any
drawing in connection with any Letter of Credit that is the subject of such
Order, notwithstanding that any drafts or other documents presented in
connection with such Letter of Credit fail to conform in any way with such
Letter of Credit.

In furtherance and extension and not in limitation of the specific provisions
set forth

 

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above, any action taken or omitted by Agent under or in connection with the
Letters of Credit issued by it or any documents and certificates delivered
thereunder, if taken or omitted in good faith and without gross negligence (as
determined by a court of competent jurisdiction in a final non-appealable
judgment), shall not put Agent under any resulting liability to any Borrower or
any Lender.

2.19. Additional Payments. Any sums expended by Agent or any Lender due to any
Borrower’s failure to perform or comply with its obligations under this
Agreement or any Other Document including any Borrower’s obligations under
Sections 4.2, 4.4, 4.12, 4.13, 4.14 and 6.1 hereof, may be charged to Borrowers’
Account as a Revolving Advance and added to the Obligations.

2.20. Manner of Borrowing and Payment.

(a) Each borrowing of Revolving Advances shall be advanced according to the
applicable Revolving Commitment Percentages of Lenders.

(b) Each payment (including each prepayment) by any Borrower on account of the
principal of and interest on the Revolving Advances, shall be applied first to
the outstanding Swing Loans and second to the Revolving Advances pro rata
according to the applicable Revolving Commitment Percentages of Lenders. Except
as expressly provided herein, all payments (including prepayments) to be made by
any Borrower on account of principal, interest and fees shall be made without
set off or counterclaim and shall be made to Agent on behalf of Lenders to the
Payment Office, in each case on or prior to 1:00 P.M., New York time, in Dollars
and in immediately available funds.

(c) (i) Unless Agent has elected to make a Swing Loan in accordance with this
Agreement, promptly after receipt by Agent of a request for a Revolving Advance
pursuant to Section 2.2(a), Agent shall notify Lenders of its receipt of such
request specifying the information provided by Borrowing Agent and the
apportionment among Lenders of the requested Revolving Advance as determined by
Agent. Each Lender shall remit the principal amount of each Revolving Advance to
Agent such that Agent is able to, and Agent shall, to the extent Lenders have
made funds available to it for such purpose and subject to Section 8.2, fund
such Revolving Advance to Borrower in U.S. Dollars and immediately available
funds at the Payment Office prior to 1:00 p.m. central time, on the applicable
borrowing date; provided that if any Lender fails to remit such funds to Agent
in a timely manner, Agent may elect in its sole discretion to fund with its own
funds the Revolving Advance of such Lender on such borrowing date, and such
Lender shall be subject to the repayment obligation in Section 2.20(c)(ii).

(ii) Unless Agent shall have received notice from a Lender prior to the proposed
date of any Revolving Advance that such Lender will not make available to Agent
such Lender’s Revolving Commitment Percentage of such Revolving Advance, Agent
may assume that such Lender has made such share available on such date in
accordance with Section 2.20(c)(i) and may, in reliance upon such assumption,
make available to Borrower a corresponding amount. In such event, if a Lender
has not in fact made its share of the applicable Revolving Advance available to
Agent, then the applicable Lender and Borrowers severally agree to pay to Agent
forthwith on demand such corresponding amount with interest thereon, for

 

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each day from and including the date such amount is made available to Borrowers
to but excluding the date of payment to Agent, at (i) in the case of a payment
to be made by such Lender, the greater of the Federal Funds Effective Rate and a
rate determined by Agent in accordance with banking industry rules on interbank
compensation, and (ii) in the case of a payment to be made by Borrower, the
interest rate applicable to Revolving Advances consisting of Domestic Rate
Loans. If such Lender pays its share of the applicable Revolving Advance to
Agent, then the amount so paid shall constitute such Lender’s Revolving Advance.
Any payment by Borrowers shall be without prejudice to any claim the Borrowers
may have against a Lender that shall have failed to make such payment to Agent.

(iii) So long as Swing Loan Lender elects to make Swing Loans, Swing Loan Lender
shall, after receipt by it of a Swing Loan Request pursuant to Section 2.4(b),
fund such Swing Loan to Borrower in U.S. Dollars and immediately available funds
at the Payment Office prior to 12:00 p.m. New York time, on the borrowing date.

(iv) PNC, shall request settlement with Lenders at least once a week or on any
date that PNC elects, by notifying Lenders of such requested settlement by
facsimile, telephone or electronic transmission no later than 12:00 p.m., New
York time on the date of such requested settlement and each Lender shall make a
Revolving Advance in an amount equal to such Lender’s Revolving Commitment
Percentage of the aggregate principal amount of the outstanding Swing Loans,
plus, if PNC so requests, accrued interest thereon, provided that no Lender
shall be obligated in any event to make Revolving Advances in an amount in
excess of its Revolving Commitment Amount. Revolving Advances made pursuant to
the preceding sentence shall bear interest at the interest rate applicable to
Revolving Advances consisting of Domestic Rate Loans and shall be deemed to have
been properly requested in accordance with Section 2.2(a) without regard to any
of the requirements of that provision. PNC shall provide notice to Lenders
(which may be telephonic or written notice by letter, facsimile or telex) that
such Revolving Advances are to be made under this Section 2.20(c)(iv) and of the
apportionment among Lenders, and Lenders shall be unconditionally obligated to
fund such Revolving Advances (whether or not the conditions specified in
Section 8.2 are then satisfied) by the time PNC so requests, which shall not be
earlier than 12:00 p.m. New York time, on the Business Day after the date
Lenders receive such notice from PNC. If any such amount is not transferred to
PNC by any Lender on such settlement date, PNC shall be entitled to recover such
amount on demand from such Lender together with interest thereon as specified in
Section 2.23.

(d) (i) Notwithstanding anything to the contrary contained in Sections 2.20(a)
and (b) hereof, commencing with the first Business Day following the Closing
Date, each borrowing of Revolving Advances shall be advanced by Agent and each
payment by any Borrower on account of Revolving Advances shall be applied first
to those Revolving Advances advanced by Agent. On or before 12:00 p.m., New York
time, on each Settlement Date commencing with the first Settlement Date
following the Closing Date, Agent and Lenders shall make certain payments as
follows (or more frequently if requested by Agent in its sole discretion):
(I) if the aggregate amount of new Revolving Advances made by Agent during the
preceding Week (if any) exceeds the aggregate amount of repayments applied to
outstanding Revolving Advances during such preceding Week, then upon the written
notice of Agent received prior to 12:00 p.m. New York time, each Lender shall
provide Agent with funds in an amount equal to its applicable Revolving
Commitment Percentage of the difference between (w)

 

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such Revolving Advances and (x) such repayments and (II) if the aggregate amount
of repayments applied to outstanding Revolving Advances during such Week exceeds
the aggregate amount of new Revolving Advances made during such Week, then Agent
shall provide each Lender with funds in an amount equal to its applicable
Revolving Commitment Percentage of the difference between (y) such repayments
and (z) such Revolving Advances.

(ii) Each Lender shall be entitled to earn interest at the applicable Contract
Rate on outstanding Advances which it has funded.

(iii) Promptly following each Settlement Date, Agent shall submit to each Lender
a certificate with respect to payments received and Advances made during the
Week immediately preceding such Settlement Date. Such certificate of Agent shall
be conclusive in the absence of manifest error.

(e) If any Lender or Participant (a “Benefited Lender”) shall at any time
receive any payment of all or part of its Advances, or interest thereon, or
receive Collateral in respect thereof (whether voluntarily or involuntarily or
by set-off) in a greater proportion than any such payment to and Collateral
received by any other Lender, if any, in respect of such other Lender’s
Advances, or interest thereon, and such greater proportionate payment or receipt
of Collateral is not expressly permitted hereunder, such Benefited Lender shall
purchase for cash from the other Lenders a participation in such portion of each
such other Lender’s Advances, or shall provide such other Lender 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 other Lenders; provided,
however, that 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. Each Lender so purchasing a portion of another
Lender’s Advances may exercise all rights of payment (including rights of
set-off) with respect to such portion as fully as if such Lender were the direct
holder of such portion.

(f) Unless Agent shall have been notified by telephone, confirmed in writing, by
any Lender that such Lender will not make the amount which would constitute its
applicable Revolving Commitment Percentage of the Advances available to Agent,
Agent may (but shall not be obligated to) assume that such Lender shall make
such amount available to Agent on the next Settlement Date and, in reliance upon
such assumption, make available to Borrowers a corresponding amount. Agent will
promptly notify Borrowing Agent of its receipt of any such notice from a Lender.
If such amount is made available to Agent on a date after such next Settlement
Date, such Lender shall pay to Agent on demand an amount equal to the product of
(i) the daily average Federal Funds Effective Rate (computed on the basis of a
year of 360 days) during such period as quoted by Agent, times (ii) such amount,
times (iii) the number of days from and including such Settlement Date to the
date on which such amount becomes immediately available to Agent. A certificate
of Agent submitted to any Lender with respect to any amounts owing under this
paragraph (e) shall be conclusive, in the absence of manifest error. If such
amount is not in fact made available to Agent by such Lender within three
(3) Business Days after such Settlement Date, Agent shall be entitled to recover
such an amount, with interest thereon at the rate per annum then applicable to
such Revolving Advances hereunder, on demand from Borrowers; provided, however,
that Agent’s right to such recovery shall not prejudice or otherwise adversely
affect Borrowers’ rights (if any) against such Lender.

 

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2.21. Mandatory Prepayments.

(a) Subject to Section 4.3 hereof, when any Borrower sells or otherwise disposes
of any Collateral other than Inventory in the Ordinary Course of Business,
Borrowers shall repay the Advances, subject to the right to reborrow hereunder,
in an amount equal to the net proceeds of such sale (i.e., gross proceeds less
the reasonable costs of such sales or other dispositions), such repayments to be
made promptly but in no event more than one (1) Business Day following receipt
of such net proceeds, and until the date of payment, such proceeds shall be held
in trust for Agent pursuant to an express trust hereby, separate and segregated
from all other funds, assets and property of Borrowers. The foregoing shall not
be deemed to be implied consent to any such sale otherwise prohibited by the
terms and conditions hereof. Repayments under this paragraph (a) shall be
applied first, to the outstanding principal balance of the Revolving Advances
and Swing Loans (in the order determined by Agent) and second, to be held by
Agent as cash collateral to the extent of any outstanding Letter of Credit
Obligations, provided that, after the occurrence and during the continuance of
an Event of Default, such repayments shall be applied to the Advances and the
other Obligations in such order as Agent may determine in its sole discretion.

(b) Upon either (i) the issuance and/or incurrence of any Indebtedness for
borrowed money (other than Indebtedness permitted in accordance with the
provisions of Section 7.8) by any Borrower or (ii) the issuance of any
additional Equity Interests (other than Equity Interests issued to employees,
officers or directors of any Borrower) or receipt of any additional capital
contributions by any Borrower, Borrowers shall repay the Advances, subject to
the right to reborrow hereunder, in an amount equal to the net cash proceeds of
such issuance, incurrence and/or capital contribution (i.e., gross proceeds less
the reasonable costs of such issuance, incurrence and/or capital contribution),
such repayments to be made promptly but in no event more than one (1) Business
Day following receipt of such net cash proceeds, and until the date of payment,
such proceeds shall be held in trust for Agent pursuant to an express trust
hereby, separate and segregated from all other funds, assets and property of
Borrowers. The foregoing shall not be deemed to be implied consent to any such
issuance and/or incurrence of Indebtedness or issuance of additional Equity
Interests otherwise prohibited by the terms and conditions hereof (to the
extent, if any, of any such prohibition contained herein). Repayments under this
subparagraph (b) shall be applied first, to the outstanding principal balance of
the Revolving Advances and Swing Loans (in the order determined by Agent) and
second, to be held by Agent as cash collateral to the extent of any outstanding
Letter of Credit Obligations, provided that, after the occurrence and during the
continuance of an Event of Default, such repayments shall be applied to the
Advances and the other Obligations in such order as Agent may determine in its
sole discretion.

2.22. Use of Proceeds.

(a) Borrowers shall apply the proceeds of Advances to (i) pay fees and expenses
relating to this transaction and (ii) provide for its working capital needs and
reimburse drawings under Letters of Credit.

 

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(b) Without limiting the generality of Section 2.22(a) above, neither the
Borrowers, the Guarantors nor any other Person which may in the future become
party to this Agreement or the Other Documents as a Borrower or Guarantor,
intends to use nor shall they use any portion of the proceeds of the Advances,
directly or indirectly, for any purpose in violation of Applicable Law or to
fund any activities of or business with any Person, or in any Sanctioned Country
that, at the time of such funding of the Advance or issuance of the Letter of
Credit, is the subject of any Sanctions.

2.23. Defaulting Lender.

(a) Notwithstanding anything to the contrary contained herein, in the event any
Lender is a Defaulting Lender, all rights and obligations hereunder of such
Defaulting Lender and of the other parties hereto shall be modified to the
extent of the express provisions of this Section 2.23 so long as such Lender is
a Defaulting Lender.

(b) (i) except as otherwise expressly provided for in this Section 2.23,
Revolving Advances shall be made pro rata from Lenders holding Revolving
Commitments which are not Defaulting Lenders based on their respective Revolving
Commitment Percentages, and no Revolving Commitment Percentage of any Lender or
any pro rata share of any Revolving Advances required to be advanced by any
Lender shall be increased as a result of any Lender being a Defaulting Lender.
Amounts received in respect of principal of any type of Revolving Advances shall
be applied to reduce such type of Revolving Advances of each Lender (other than
any Defaulting Lender) holding a Revolving Commitment in accordance with their
Revolving Commitment Percentages; provided, that, Agent shall not be obligated
to transfer to a Defaulting Lender any payments received by Agent for the
Defaulting Lender’s benefit, nor shall a Defaulting Lender be entitled to the
sharing of any payments hereunder (including any principal, interest or fees).
Amounts payable to a Defaulting Lender shall instead be paid to or retained by
Agent. Agent may hold and, in its discretion, re-lend to a Borrower the amount
of such payments received or retained by it for the account of such Defaulting
Lender.

(ii) fees pursuant to Section 3.3 hereof shall cease to accrue in favor of such
Defaulting Lender.

(iii) if any Letter of Credit Obligations (or drawings under any Letter of
Credit for which the Issuer has not been reimbursed) are outstanding or exist at
the time any such Lender holding a Revolving Commitment becomes a Defaulting
Lender, then:

(A) the Defaulting Lender’s Participation Commitment of the Maximum Undrawn
Amount of all outstanding Letters of Credit shall be reallocated among the
Non-Defaulting Lenders holding Revolving Commitments in proportion to the
respective Revolving Commitment Percentages of such Non-Defaulting Lenders to
the extent (but only to the extent) that (x) such reallocation does not cause
the aggregate sum of outstanding Revolving Advances made by any such
Non-Defaulting Lender holding a Revolving Commitment plus such Lender’s
reallocated Participation Commitment in the aggregate Maximum Undrawn Amount of
all outstanding Letters of Credit to exceed the Revolving Commitment Amount of
any such Non-Defaulting Lender, and (y) no Default or Event of Default has
occurred and is continuing at such time;

 

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(B) if the reallocation described in clause (A) above cannot, or can only
partially, be effected, the Borrowers shall within one Business Day following
notice by the Agent cash collateralize for the benefit of the Issuer the
Borrowers’ obligations corresponding to such Defaulting Lender’s Participation
Commitment in the Maximum Undrawn Amount of all Letters of Credit (after giving
effect to any partial reallocation pursuant to clause (A) above) in accordance
with Section 3.2(b) for so long as such Obligations are outstanding;

(C) if the Borrowers cash collateralize any portion of such Defaulting Lender’s
Participation Commitment in the Maximum Undrawn Amount of all Letters of Credit
pursuant to clause (B) above, the Borrower shall not be required to pay any fees
to such Defaulting Lender pursuant to Section 3.2(a) with respect to such
Defaulting Lender’s Revolving Commitment Percentage of Maximum Undrawn Amount of
all Letters of Credit during the period such Defaulting Lender’s Participation
Commitment in the Maximum Undrawn Amount of all Letters of Credit are cash
collateralized;

(D) if the Defaulting Lender’s Participation Commitment in the Maximum Undrawn
Amount of all Letters of Credit is reallocated pursuant to clause (A) above,
then the fees payable to the Lenders holding Revolving Commitments pursuant to
Section 3.2(a) shall be adjusted and reallocated to the Non-Defaulting Lenders
holding Revolving Commitments in accordance with such reallocation; and

(E) if all or any portion of such Defaulting Lender’s Participation Commitment
in the Maximum Undrawn Amount of all Letters of Credit is neither reallocated
nor cash collateralized pursuant to clause (A) or (B) above, then, without
prejudice to any rights or remedies of the Issuer or any other Lender hereunder,
all Letter of Credit Fees payable under Section 3.2(a) with respect to such
Defaulting Lender’s Revolving Commitment Percentage of the Maximum Undrawn
Amount of all Letters of Credit shall be payable to the Issuer (and not to such
Defaulting Lender) until (and then only to the extent that) such Revolving
Participation Commitment in the Maximum Undrawn Amount of all Letters of Credit
is reallocated and/or cash collateralized; and

(iv) so long as any Lender holding a Revolving Commitment is a Defaulting
Lender, Swing Loan Lender shall not be required to fund any Swing Loans and the
Issuer shall not be required to issue, amend or increase any Letter of Credit,
unless such Issuer is satisfied that the related exposure and the Defaulting
Lender’s Participation Commitment in the Maximum Undrawn Amount of all Letters
of Credit (after giving effect to any such issuance, amendment, increase or
funding) will be fully allocated to the Non-Defaulting Lenders holding

 

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Revolving Commitments and/or cash collateral for such Letters of Credit will be
provided by the Borrowers in accordance with clauses (A) and (B) above, and
participating interests in any newly issued or increased Letter of Credit shall
be allocated among the Non-Defaulting Lenders in a manner consistent with
Section 2.23(b)(iii)(A) above (and such Defaulting Lender shall not participate
therein).

(c) A Defaulting Lender shall not be entitled to give instructions to Agent or
to approve, disapprove, consent to or vote on any matters relating to this
Agreement and the Other Documents, and all amendments, waivers and other
modifications of this Agreement and the Other Documents may be made without
regard to a Defaulting Lender and, for purposes of the definition of “Required
Lenders”, a Defaulting Lender shall not be deemed to be a Lender, to have any
outstanding Advances or a Revolving Commitment Percentage, provided, that this
clause (c) shall not apply to the vote of a Defaulting Lender in the case of an
amendment, waiver or other modification described in clauses (i) or (ii) of
Section 16.2(b).

(d) Other than as expressly set forth in this Section 2.23, the rights and
obligations of a Defaulting Lender (including the obligation to indemnify Agent)
and the other parties hereto shall remain unchanged. Nothing in this
Section 2.23 shall be deemed to release any Defaulting Lender from its
obligations under this Agreement and the Other Documents, shall alter such
obligations, shall operate as a waiver of any default by such Defaulting Lender
hereunder, or shall prejudice any rights which any Borrower, Agent or any Lender
may have against any Defaulting Lender as a result of any default by such
Defaulting Lender hereunder.

(e) In the event that the Agent, the Borrowers, and the Issuer agree in writing
that a Defaulting Lender has adequately remedied all matters that caused such
Lender to be a Defaulting Lender, then the Agent will so notify the parties
hereto, and, if such cured Defaulting Lender is a Lender holding a Revolving
Commitment, then Participation Commitments of the Lenders holding Revolving
Commitments (including such cured Defaulting Lender) of the Maximum Undrawn
Amount of all outstanding Letters of Credit shall be reallocated to reflect the
inclusion of such Lender’s Revolving Commitment, and on such date such Lender
shall purchase at par such of the Revolving Advances of the other Lenders as the
Agent shall determine may be necessary in order for such Lender to hold such
Revolving Advances in accordance with its Revolving Commitment Percentage.

(f) If Swing Loan Lender or Issuer has a good faith belief that any Lender
holding a Revolving Commitment has defaulted in fulfilling its obligations under
one or more other agreements in which such Lender commits to extend credit,
Swing Loan Lender shall not be required to fund any Swing Loans and Issuer shall
not be required to issue, amend or increase any Letter of Credit, unless Swing
Loan Lender or Issuer, as the case may be, shall have entered into arrangements
with Borrowers or such Lender, satisfactory to Swing Loan Lender or Issuer, as
the case may be, to defease any risk to it in respect of such Lender hereunder.

2.24. Increase of the Maximum Loan Amount by Borrowers.

(a) Borrowers may, by written notice to Agent, request that Agent increase the
Maximum Loan Amount (each a “Borrower Revolver Increase”) by (i) adding one or
more new lenders to the revolving credit facility under this Agreement (each a
“Section 2.24 New

 

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Lender”) who wish to participate in such Borrower Revolver Increase and/or
(ii) increasing the Revolving Commitment Amount of one or more Revolving Lenders
party to this Agreement who wish to participate in such Borrower Revolver
Increase; provided, however, that (w) Borrowers may only add a Section 2.24 New
Lender if, and only to the extent, there is insufficient participation on behalf
of the existing Revolving Lenders, (x) no Default or Event of Default shall have
occurred and be continuing as of the date of such request or as of the effective
date of such Borrower Revolver Increase (each a “Borrower Increase Date”) or
shall occur as a result thereof, (y) any Section 2.24 New Lender that becomes
party to this Agreement pursuant to this Section 2.24 shall satisfy the
requirements of Section 16.3 hereof and shall be acceptable to Agent and
consented to by Borrowers and (z) the other conditions set forth in this
Section 2.24 are satisfied. Agent shall use commercially reasonable efforts to
arrange for the syndication of any Borrower Revolver Increase. Agent shall
promptly inform the Revolving Lenders of any such request made by Borrowers. The
aggregate amount of Borrower Revolver Increases hereunder shall not exceed
$75,000,000 and no single Borrower Revolver Increase shall be for an amount less
than $25,000,000.

(b) On a Borrower Increase Date, (i) each Section 2.24 New Lender that has
chosen to participate in such Borrower Revolver Increase shall, subject to the
conditions set forth in Section 2.24(a), become a Revolving Lender party to this
Agreement as of such Borrower Increase Date and shall have a Revolving
Commitment Amount in an amount equal to its share of such Borrower Revolver
Increase (and its Revolving Commitment Percentage shall be equal to the
percentage equivalent of a fraction the numerator of which shall be the
Revolving Commitment Amount of such Section 2.24 New Lender and the denominator
of which shall be the Maximum Loan Amount after giving effect to such Borrower
Revolver Increase) and (ii) each Revolving Lender that has chosen to increase
its Revolving Commitment Amount pursuant to this Section 2.24 will have its
Revolving Commitment Amount increased by the amount of its share of the Borrower
Revolver Increase as of such Borrower Increase Date (and its Revolving
Commitment Percentage shall be adjusted as appropriate); provided, however, that
(x) Agent and each Lender participating in such Borrower Revolver Increase shall
have received from Borrowers payment of any fees and/or expenses then due with
respect to such Borrower Revolver Increase and Agent shall have received from
Borrowers payment of all out-of-pocket costs and expenses incurred by Agent in
connection with such Borrower Revolver Increase, and (y) Agent shall have
received on or before such Borrower Increase Date the following, each dated such
date: (i) an assumption agreement from each Section 2.24 New Lender
participating in such Borrower Revolver Increase, if any, in form and substance
satisfactory to Agent, duly executed by such Section 2.24 New Lender, Agent and
Borrowers; (ii) confirmation from each Revolving Lender participating in such
Borrower Revolver Increase of the increase in the amount of its Revolving
Commitment Amount and of any change in its Revolving Commitment Percentage, in
form and substance satisfactory to the Agent; (iii) a certificate of Borrowing
Agent certifying that no Default or Event of Default shall have occurred and be
continuing or shall occur as a result of such Borrower Revolver Increase; (iv) a
certificate of Borrowing Agent certifying that the representations and
warranties made by each Borrower herein and in the Other Documents are true and
complete in all respects with the same force and effect as if made on and as of
such date (or, to the extent any such representation or warranty specifically
relates to an earlier date, such representation or warranty is true and complete
in all respects as of such earlier date); (v) supplements or modifications to
this Agreement and the Other Documents and such additional Other Documents,
including any new Revolving Credit Notes to Section 2.24 New

 

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Lenders and replacement Revolving Credit Notes to Revolving Lenders that agree
to participate in such Borrower Revolver Increase, that Agent reasonably deems
necessary in order to document such Borrower Revolver Increase and otherwise
assure and give effect to the rights of Agent and Revolving Lenders in this
Agreement and the Other Documents; (vi) such other documents, instruments and
information as Agent or its counsel shall reasonably deem necessary in
connection with such Borrower Revolver Increase; and (vii) additional fees
calculated on the amount of the Borrower Revolver Increase and payable to Agent
for the benefit of Lenders (including the Section 2.24 New Lenders)
participating therein, and to Agent, the amount of which shall be determined at
the time of the Borrower Revolver Increase based upon the market at such time
for similar transactions, which shall be mutually agreeable to Borrower and
Agent. On such Borrower Increase Date, upon fulfillment of the conditions set
forth in this Section 2.24, Agent shall (i) effect a settlement of all
outstanding Advances among the Revolving Lenders that will reflect the
adjustments to the Revolving Commitment Percentages of the Revolving Lenders as
a result of such Borrower Revolver Increase and (ii) notify Revolving Lenders
(including any Section 2.24 New Lenders) participating in such Borrower Revolver
Increase and the Borrowers, on or before 12:00 noon, by telecopier or e-mail, of
the occurrence of such Borrower Revolver Increase to be effected on such
Borrower Increase Date.

 

III. INTEREST AND FEES.

3.1. Interest. Interest on Advances shall be payable in arrears on the first day
of each month with respect to Domestic Rate Loans and, with respect to
Eurodollar Rate Loans, at the end of each Interest Period. Interest charges
shall be computed on the actual principal amount of Advances outstanding during
the month at a rate per annum equal to (i) with respect to Revolving Advances,
the applicable Revolving Interest Rate and (ii) with respect to Swing Loans, the
rate set forth in subclause (a) of the definition of Revolving Interest Rate (as
applicable, the “Contract Rate”). Whenever, subsequent to the date of this
Agreement, the Alternate Base Rate is increased or decreased, the applicable
Contract Rate shall be similarly changed without notice or demand of any kind by
an amount equal to the amount of such change in the Alternate Base Rate during
the time such change or changes remain in effect. The Eurodollar Rate shall be
adjusted with respect to Eurodollar Rate Loans without notice or demand of any
kind on the effective date of any change in the Reserve Percentage as of such
effective date. Upon and after the occurrence of an Event of Default, and during
the continuation thereof, at the option of Agent or at the direction of Required
Lenders, the Obligations shall bear interest at the applicable Contract Rate
plus two (2%) percent per annum (the “Default Rate”).

3.2. Letter of Credit Fees.

(a) Borrowers shall pay (x) to Agent, for the ratable benefit of Lenders, fees
for each Letter of Credit for the period from and excluding the date of issuance
of same to and including the date of expiration or termination, equal to the
average daily face amount of each outstanding Letter of Credit multiplied by two
and one half percent (2.50%) per annum, such fees to be calculated on the basis
of a 360-day year for the actual number of days elapsed and to be payable
quarterly in arrears on the first day of each quarter and on the last day of the
Term, and (y) to the Issuer, a fronting fee of one quarter of one percent
(0.25%) per annum times the average daily face amount of each outstanding Letter
of Credit for the period from and excluding the date of issuance of the same to
and including the date of expiration and termination of the

 

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same, together with any and all administrative, issuance, amendment, payment and
negotiation charges with respect to Letters of Credit and all fees and expenses
as agreed upon by the Issuer and the Borrowing Agent in connection with any
Letter of Credit, including in connection with the opening, amendment or renewal
of any such Letter of Credit and any acceptances created thereunder and shall
reimburse Agent for any and all fees and expenses, if any, paid by Agent to the
Issuer (all of the foregoing fees, the “Letter of Credit Fees”). All such
charges shall be deemed earned in full on the date when the same are due and
payable hereunder and shall not be subject to rebate or pro-ration upon the
termination of this Agreement for any reason. Any such charge in effect at the
time of a particular transaction shall be the charge for that transaction,
notwithstanding any subsequent change in the Issuer’s prevailing charges for
that type of transaction. All Letter of Credit Fees payable hereunder shall be
deemed earned in full on the date when the same are due and payable hereunder
and shall not be subject to rebate or pro-ration upon the termination of this
Agreement for any reason.

(b) At any time following the occurrence of an Event of Default or the
expiration of the Term Borrowers will cause cash to be deposited and maintained
in an account with Agent, as cash collateral, in an amount equal to one hundred
and ten percent (110%) of the Maximum Undrawn Amount of all outstanding Letters
of Credit, and each Borrower hereby irrevocably authorizes Agent, in its
discretion, on such Borrower’s behalf and in such Borrower’s name, to open such
an account and to make and maintain deposits therein, or in an account opened by
such Borrower, in the amounts required to be made by such Borrower, out of the
proceeds of Receivables or other Collateral or out of any other funds of such
Borrower coming into any Lender’s possession at any time. Agent will invest such
cash collateral (less applicable reserves) in such short-term money-market items
as to which Agent and such Borrower mutually agree and the net return on such
investments shall be credited to such account and constitute additional cash
collateral. No Borrower may withdraw amounts credited to any such account except
upon the occurrence of all of the following: (x) payment and performance in full
of all Obligations; (y) expiration of all Letters of Credit; and (z) termination
of this Agreement.

3.3. Facility Fee and Fee Letter.

(a) If, for any calendar quarter during the Term, the average daily unpaid
balance of the Revolving Advances (and for purposes of this calculation, all
Swing Loans advanced by PNC shall be treated as Revolving Advances) and undrawn
amount of any outstanding Letters of Credit for each day of such calendar
quarter does not equal the Maximum Loan Amount, then Borrowers shall pay to
Agent for the ratable benefit of Lenders a fee at a rate equal to one-half of
one percent (.50%) on the amount by which the Maximum Loan Amount exceeds such
average daily unpaid balance. Such fee shall be payable to Agent in arrears on
the first day of each April, July, October and January with respect to the
previous three month period.

(b) Borrowers shall pay the amounts required to be paid in the Fee Letter in the
manner and at the times required by the Fee Letter.

3.4. Reserved.

 

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3.5. Computation of Interest and Fees. Interest and fees hereunder shall be
computed on the basis of a year of 360 days and for the actual number of days
elapsed. If any payment to be made hereunder becomes due and payable on a day
other than a Business Day, the due date thereof shall be extended to the next
succeeding Business Day and interest thereon shall be payable at the applicable
Contract Rate during such extension.

3.6. Maximum Charges. In no event whatsoever shall interest and other charges
charged hereunder exceed the highest rate permissible under law. In the event
interest and other charges as computed hereunder would otherwise exceed the
highest rate permitted under law, such excess amount shall be first applied to
any unpaid principal balance owed by Borrowers, and if the then remaining excess
amount is greater than the previously unpaid principal balance, Lenders shall
promptly refund such excess amount to Borrowers and the provisions hereof shall
be deemed amended to provide for such permissible rate.

3.7. Increased Costs. In the event that any Applicable Law, or any Change in Law
or in the interpretation or application thereof, or compliance by Swing Loan
Lender, or any Lender (for purposes of this Section 3.7, the term “Lender” shall
include Agent or any Lender and any corporation or bank controlling Agent, Swing
Loan Lender, or any Lender) and the office or branch where Agent, Swing Loan
Lender, or any Lender (as so defined) makes or maintains any Eurodollar Rate
Loans with any request or directive (whether or not having the force of law)
from any central bank or other financial, monetary or other authority, shall:

(a) subject Agent, Swing Loan Lender, or any Lender to any tax of any kind
whatsoever with respect to this Agreement or any Other Document or change the
basis of taxation of payments to Agent, Swing Loan Lender, or any Lender of
principal, fees, interest or any other amount payable hereunder or under any
Other Documents (except for changes in the rate of tax on the overall net income
of Agent, Swing Loan Lender, or any Lender by the jurisdiction in which it
maintains its principal office);

(b) impose, modify or hold applicable any reserve, special deposit, assessment
or similar requirement against assets held by, or deposits in or for the account
of, advances or loans by, or other credit extended by, any office of Agent,
Swing Loan Lender or any Lender, including pursuant to Regulation D of the Board
of Governors of the Federal Reserve System; or

(c) impose on Agent, Swing Loan Lender, or any Lender or the London interbank
Eurodollar market any other condition with respect to this Agreement or any
Other Document;

and the result of any of the foregoing is to increase the cost to Agent, Swing
Loan Lender or any Lender of making, renewing or maintaining its Advances
hereunder by an amount that Agent, Swing Loan Lender or such Lender deems to be
material or to reduce the amount of any payment (whether of principal, interest
or otherwise) in respect of any of the Advances by an amount that Agent, Swing
Loan Lender or such Lender deems to be material, then, in any case Borrowers
shall promptly pay Agent, Swing Loan Lender or such Lender, upon its demand,
such additional amount as will compensate Agent, Swing Loan Lender or such
Lender for such additional cost or such reduction, as the case may be, provided
that the foregoing shall not apply to increased costs which are reflected in the
Eurodollar Rate, as the case may be. Agent, Swing Loan Lender or such Lender
shall certify the amount of such additional cost or reduced amount to Borrowing
Agent, and such certification shall be conclusive absent manifest error.

 

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3.8. Basis For Determining Interest Rate Inadequate or Unfair. In the event that
Agent or any Lender shall have determined that:

(a) reasonable means do not exist for ascertaining the Eurodollar Rate
applicable pursuant to Section 2.2 hereof for any Interest Period; or

(b) Dollar deposits in the relevant amount and for the relevant maturity are not
available in the London interbank Eurodollar market, with respect to an
outstanding Eurodollar Rate Loan, a proposed Eurodollar Rate Loan, or a proposed
conversion of a Domestic Rate Loan into a Eurodollar Rate Loan,

then Agent shall give Borrowing Agent prompt written, telephonic or telegraphic
notice of such determination. If such notice is given, (i) any such requested
Eurodollar Rate Loan shall be made as a Domestic Rate Loan, unless Borrowing
Agent shall notify Agent no later than 10:00 a.m. (New York City time) two
(2) Business Days prior to the date of such proposed borrowing, that its request
for such borrowing shall be cancelled or made as an unaffected type of
Eurodollar Rate Loan, (ii) any Domestic Rate Loan or Eurodollar Rate Loan which
was to have been converted to an affected type of Eurodollar Rate Loan shall be
continued as or converted into a Domestic Rate Loan, or, if Borrowing Agent
shall notify Agent, no later than 10:00 a.m. (New York City time) two
(2) Business Days prior to the proposed conversion, shall be maintained as an
unaffected type of Eurodollar Rate Loan, and (iii) any outstanding affected
Eurodollar Rate Loans shall be converted into a Domestic Rate Loan, or, if
Borrowing Agent shall notify Agent, no later than 10:00 a.m. (New York City
time) two (2) Business Days prior to the last Business Day of the then current
Interest Period applicable to such affected Eurodollar Rate Loan, shall be
converted into an unaffected type of Eurodollar Rate Loan, on the last Business
Day of the then current Interest Period for such affected Eurodollar Rate Loans.
Until such notice has been withdrawn, Lenders shall have no obligation to make
an affected type of Eurodollar Rate Loan or maintain outstanding affected
Eurodollar Rate Loans and no Borrower shall have the right to convert a Domestic
Rate Loan or an unaffected type of Eurodollar Rate Loan into an affected type of
Eurodollar Rate Loan.

3.9. Capital Adequacy.

(a) In the event that Agent, Swing Loan Lender or any Lender shall have
determined that any Applicable Law, or guideline regarding capital adequacy, or
any Change in Law, or any change in the interpretation or administration thereof
by any Governmental Body, central bank or comparable agency charged with the
interpretation or administration thereof, or compliance by Agent, Swing Loan
Lender or any Lender (for purposes of this Section 3.9, the term “Lender” shall
include Agent, Swing Loan Lender or any Lender and any corporation or bank
controlling Agent, Swing Loan Lender or any Lender) and the office or branch
where Agent, Swing Loan Lender or any Lender (as so defined) makes or maintains
any Eurodollar Rate Loans with any request or directive regarding capital
adequacy (whether or not having the force of law) of any such authority, central
bank or comparable agency, has or would have the effect of reducing the rate of
return on Agent, Swing Loan Lender or any Lender’s capital as a

 

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consequence of its obligations hereunder to a level below that which Agent,
Swing Loan Lender or such Lender could have achieved but for such adoption,
change or compliance (taking into consideration Agent, Swing Loan Lender or each
Lender’s policies with respect to capital adequacy) by an amount deemed by
Agent, Swing Loan Lender or any Lender to be material, then, from time to time,
Borrowers shall pay upon demand to Agent, Swing Loan Lender or any Lender such
additional amount or amounts as will compensate Agent or such Lender for such
reduction. In determining such amount or amounts, Agent, Swing Loan Lender or
any Lender may use any reasonable averaging or attribution methods. The
protection of this Section 3.9 shall be available to Agent, Swing Loan Lender
and each Lender regardless of any possible contention of invalidity or
inapplicability with respect to the Applicable Law, Change in Law or condition.

(b) A certificate of Agent, Swing Loan Lender or such Lender setting forth such
amount or amounts as shall be necessary to compensate Agent or such Lender with
respect to Section 3.9(a) hereof when delivered to Borrowing Agent shall be
conclusive absent manifest error.

3.10. Taxes.

(a) Any and all payments by or on account of any Obligations hereunder or under
any Other Document shall be made free and clear of and without reduction or
withholding for any Indemnified Taxes or Other Taxes; provided that if Borrowers
shall be required by Applicable Law to deduct any Indemnified Taxes (including
any Other Taxes) from such payments, then (i) the sum payable shall be increased
as necessary so that after making all required deductions (including deductions
applicable to additional sums payable under this Section) Agent, Swing Loan
Lender, Lender, Issuer or Participant, as the case may be, receives an amount
equal to the sum it would have received had no such deductions been made,
(ii) Borrowers shall make such deductions and (iii) Borrowers shall timely pay
the full amount deducted to the relevant Governmental Body in accordance with
Applicable Law.

(b) Without limiting the provisions of Section 3.10(a) above, Borrowers shall
timely pay any Other Taxes to the relevant Governmental Body in accordance with
Applicable Law.

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

 

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(d) As soon as practicable after any payment of Indemnified Taxes or Other Taxes
by any Borrower to a Governmental Body, Borrowers shall deliver to Agent the
original or a certified copy of a receipt issued by such Governmental Body
evidencing such payment, a copy of the return reporting such payment or other
evidence of such payment reasonably satisfactory to Agent.

(e) Any Foreign Lender that is entitled to an exemption from or reduction of
withholding tax under the law of the jurisdiction in which any Borrower is
resident for tax purposes, or under any treaty to which such jurisdiction is a
party, with respect to payments hereunder or under any Other Document shall
deliver to Borrowers (with a copy to Agent), at the time or times prescribed by
Applicable Law or reasonably requested by Borrowers or Agent, such properly
completed and executed documentation prescribed by Applicable Law as will permit
such payments to be made without withholding or at a reduced rate of
withholding. Notwithstanding the submission of such documentation claiming a
reduced rate of or exemption from U.S. withholding tax, Agent shall be entitled
to withhold United States federal income taxes at the full 30% withholding rate
if in its reasonable judgment it is required to do so under the due diligence
requirements imposed upon a withholding agent under § 1.1441-7(b) of the United
States Income Tax Regulations or other Applicable Law. Further, Agent is
indemnified under § 1.1461-1(e) of the United States Income Tax Regulations
against any claims and demands of any Lender, Issuer or assignee or participant
of a Lender or Issuer for the amount of any tax it deducts and withholds in
accordance with regulations under § 1441 of the Code. In addition, any Lender,
if requested by Borrowers or Agent, shall deliver such other documentation
prescribed by Applicable Law or reasonably requested by the Borrowers or Agent
as will enable Borrowers or Agent to determine whether or not such Lender is
subject to backup withholding or information reporting requirements. Without
limiting the generality of the foregoing, in the event that any Borrower is
resident for tax purposes in the United States of America, any Foreign Lender
(or other Lender) shall deliver to Borrowers and Agent (in such number of copies
as shall be requested by the recipient) on or prior to the date on which such
Foreign Lender (or other Lender) becomes a Lender under this Agreement (and from
time to time thereafter upon the request of Borrowers or Agent, but only if such
Foreign Lender (or other Lender) is legally entitled to do so), whichever of the
following is applicable:

(i) two (2) duly completed valid originals of IRS Form W-8BEN or W-8BEN-E
claiming eligibility for benefits of an income tax treaty to which the United
States of America is a party,

(ii) two (2) duly completed valid originals of IRS Form W-8ECI,

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

(iv) any other form prescribed by Applicable Law as a basis for claiming
exemption from or a reduction in United States Federal withholding tax duly
completed together with such supplementary documentation as may be prescribed by
Applicable Law to permit the Borrowers to determine the withholding or deduction
required to be made, or

 

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(v) To the extent that any Lender is not a Foreign Lender, such Lender shall
submit to Agent two (2) originals of an IRS Form W-9 or any other form
prescribed by Applicable Law demonstrating that such Lender is not a Foreign
Lender.

(f) If a payment made to a Lender, Swing Loan Lender, Participant, Issuer, or
Agent under this Agreement or any Other Document would be subject to U.S.
Federal withholding Tax imposed by FATCA if such Person fails to comply with the
applicable reporting requirements of FATCA (including those contained in
Section 1471(b) or 1472(b) of the Code, as applicable), such Lender, Swing Loan
Lender, Participant, Issuer, or Agent shall deliver to the Agent (in the case of
Swing Loan Lender, a Lender, Participant or Issuer) and Borrowers (A) a
certification signed by the chief financial officer, principal accounting
officer, treasurer or controller of such Person, and (B) other documentation
reasonably requested by Agent or any Borrower sufficient for Agent and Borrowers
to comply with their obligations under FATCA and to determine that Swing Loan
Lender, such Lender, Participant, Issuer, or Agent has complied with such
applicable reporting requirements.

3.11. Replacement of Lenders. If any Lender (an “Affected Lender”) (a) makes
demand upon Borrowers for (or if Borrowers are otherwise required to pay)
amounts pursuant to Section 3.7 or 3.9 hereof, (b) is unable to make or maintain
LIBOR Rate Loans as a result of a condition described in Section 2.2(g) hereof,
(c) is a Defaulting Lender, or (d) denies any consent requested by the Agent
pursuant to Section 16.2(b) hereof, Borrowers may, within ninety (90) days of
receipt of such demand, notice (or the occurrence of such other event causing
Borrowers to be required to pay such compensation or causing Section 2.2(g)
hereof to be applicable), or such Lender becoming a Defaulting Lender or denial
of a request by Agent pursuant to Section 16.2(b) hereof, as the case may be, by
notice in writing to the Agent and such Affected Lender (i) request the Affected
Lender to cooperate with Borrowers in obtaining a replacement Lender
satisfactory to Agent and Borrowers (the “Replacement Lender”); (ii) request the
non-Affected Lenders to acquire and assume all of the Affected Lender’s Advances
and its Revolving Commitment Percentage as provided herein, but none of such
Lenders shall be under any obligation to do so; or (iii) propose a Replacement
Lender subject to approval by Agent in its good faith business judgment. If any
satisfactory Replacement Lender shall be obtained, and/or if any one or more of
the non-Affected Lenders shall agree to acquire and assume all of the Affected
Lender’s Advances and its Revolving Commitment Percentage, then such Affected
Lender shall assign, in accordance with Section 16.3 hereof, all of its Advances
and its Revolving Commitment Percentage, and other rights and obligations under
this Agreement and the Other Documents to such Replacement Lender or
non-Affected Lenders, as the case may be, in exchange for payment of the
principal amount so assigned and all interest and fees accrued on the amount so
assigned, plus all other Obligations then due and payable to the Affected
Lender.

 

IV. COLLATERAL: GENERAL TERMS

4.1. Security Interest in the Collateral. To secure the prompt payment and
performance to Agent and each Lender of the Obligations, each Borrower hereby
assigns, pledges and grants to Agent for its benefit and for the ratable benefit
of each Lender and Swing

 

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Loan Lender a continuing security interest in and to and Lien on all of its
Collateral, whether now owned or existing or hereafter acquired or arising and
wheresoever located. Each Borrower shall mark its books and records as may be
necessary or appropriate to evidence, protect and perfect Agent’s security
interest and shall cause its financial statements to reflect such security
interest. Each Borrower shall promptly provide Agent with written notice of all
commercial tort claims, such notice to contain the case title together with the
applicable court and a brief description of the claim(s). Upon delivery of each
such notice, such Borrower shall be deemed to hereby grant to Agent a security
interest and lien in and to such commercial tort claims and all proceeds
thereof.

4.2. Perfection of Security Interest. Each Borrower shall take all action that
may be necessary or desirable, or that Agent may request, so as at all times to
maintain the validity, perfection, enforceability and priority of Agent’s
security interest in and Lien on the Collateral or to enable Agent to protect,
exercise or enforce its rights hereunder and in the Collateral, including, but
not limited to, (i) immediately, and in any event, within ten (10) days,
discharging all Liens other than Permitted Encumbrances, (ii) obtaining Lien
Waiver/Inventory Acknowledgments, (iii) delivering to Agent, endorsed or
accompanied by such instruments of assignment as Agent may specify, and stamping
or marking, in such manner as Agent may specify, any and all chattel paper,
instruments, letters of credits and advices thereof and documents evidencing or
forming a part of the Collateral, (iv) entering into warehousing, lockbox and
other custodial arrangements satisfactory to Agent, and (v) executing and
delivering financing statements, control agreements, instruments of pledge,
mortgages, notices and assignments, in each case in form and substance
satisfactory to Agent, relating to the creation, validity, perfection,
maintenance or continuation of Agent’s security interest and Lien under the
Uniform Commercial Code or other Applicable Law. By its signature hereto, each
Borrower hereby authorizes Agent to file against such Borrower, one or more
financing, continuation or amendment statements pursuant to the Uniform
Commercial Code in form and substance satisfactory to Agent (which statements
may have a description of collateral which is broader than that set forth
herein). All charges, expenses and fees Agent may incur in doing any of the
foregoing, and any local taxes relating thereto, shall be charged to Borrowers’
Account as a Revolving Advance of a Domestic Rate Loan and added to the
Obligations, or, at Agent’s option, shall be paid to Agent for its benefit and
for the ratable benefit of Lenders immediately upon demand.

4.3. Disposition of Collateral. Each Borrower will safeguard and protect all
Collateral for Agent’s general account and make no disposition thereof whether
by sale, lease or otherwise except (a) the sale of Inventory in the Ordinary
Course of Business and (b) the disposition or transfer of obsolete and worn-out
Equipment in the Ordinary Course of Business during any fiscal year having an
aggregate fair market value of not more than $100,000 and only to the extent
that (i) the proceeds of any such disposition are used to acquire replacement
Equipment which is subject to Agent’s first priority security interest or
(ii) the proceeds of which are remitted to Agent to be applied pursuant to
Section 2.21.

4.4. Preservation of Collateral. Following the occurrence of a Default or Event
of Default, in addition to the rights and remedies set forth in Section 11.1
hereof, Agent: (a) may at any time take such steps as Agent deems necessary to
protect Agent’s interest in and to preserve the Collateral, including the hiring
of such security guards or the placing of other security

 

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protection measures as Agent may deem appropriate; (b) may employ and maintain
at any of any Borrower’s premises a custodian who shall have full authority to
do all acts necessary to protect Agent’s interests in the Collateral; (c) may
lease warehouse facilities to which Agent may move all or part of the
Collateral; (d) may use any Borrower’s owned or leased lifts, hoists, trucks and
other facilities or equipment for handling or removing the Collateral; and
(e) shall have, and is hereby granted, a right of ingress and egress to the
places where the Collateral is located, and may proceed over and through any of
Borrowers’ owned or leased property. Each Borrower shall cooperate fully with
all of Agent’s efforts to preserve the Collateral and will take such actions to
preserve the Collateral as Agent may direct. All of Agent’s expenses of
preserving the Collateral, including any expenses relating to the bonding of a
custodian, shall be charged to Borrowers’ Account as a Revolving Advance
maintained as a Domestic Rate Loan and added to the Obligations.

4.5. Ownership of Collateral.

(a) With respect to the Collateral, at the time the Collateral becomes subject
to Agent’s security interest: (i) each Borrower shall be the sole owner of and
fully authorized and able to sell, transfer, pledge and/or grant a first
priority security interest in each and every item of the its respective
Collateral to Agent; and, except for Permitted Encumbrances the Collateral shall
be free and clear of all Liens and encumbrances whatsoever; (ii) each document
and agreement executed by each Borrower or delivered to Agent or any Lender in
connection with this Agreement shall be true and correct in all respects;
(iii) all signatures and endorsements of each Borrower that appear on such
documents and agreements shall be genuine and each Borrower shall have full
capacity to execute same; and (iv) each Borrower’s Equipment and Inventory shall
be located as set forth on Schedule 4.5 and shall not be removed from such
location(s) without the prior written consent of Agent except with respect to
the sale of Inventory in the Ordinary Course of Business and Equipment to the
extent permitted in Section 4.3 hereof.

(b) (i) There is no location at which any Borrower has any Inventory (except for
Inventory in transit) other than those locations listed on Schedule 4.5;
(ii) Schedule 4.5 hereto contains a correct and complete list, as of the Closing
Date, of the legal names and addresses of each warehouse at which Inventory of
any Borrower is stored; none of the receipts received by any Borrower from any
warehouse states that the goods covered thereby are to be delivered to bearer or
to the order of a named Person or to a named Person and such named Person’s
assigns; (iii) Schedule 4.5 hereto sets forth a correct and complete list as of
the Closing Date of (A) each place of business of each Borrower and (B) the
chief executive office of each Borrower; and (iv) Schedule 4.5 hereto sets forth
a correct and complete list as of the Closing Date of the location, by state and
street address, of all Real Property owned or leased by each Borrower, together
with the names and addresses of any landlords.

4.6. Defense of Agent’s and Lenders’ Interests. Until (a) payment and
performance in full of all of the Obligations and (b) termination of this
Agreement, Agent’s interests in the Collateral shall continue in full force and
effect. During such period no Borrower shall, without Agent’s prior written
consent, pledge, sell (except Inventory in the Ordinary Course of Business and
Equipment to the extent permitted in Section 4.3 hereof), assign, transfer,
create or suffer to exist a Lien upon or encumber or allow or suffer to be
encumbered in any way except for Permitted Encumbrances, any part of the
Collateral. Each Borrower shall defend Agent’s

 

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interests in the Collateral against any and all Persons whatsoever. At any time
following demand by Agent for payment of all Obligations, Agent shall have the
right to take possession of the indicia of the Collateral and the Collateral in
whatever physical form contained, including: labels, stationery, documents,
instruments and advertising materials. If Agent exercises this right to take
possession of the Collateral, Borrowers shall, upon demand, assemble it in the
best manner possible and make it available to Agent at a place reasonably
convenient to Agent. In addition, with respect to all Collateral, Agent and
Lenders shall be entitled to all of the rights and remedies set forth herein and
further provided by the Uniform Commercial Code or other Applicable Law. Each
Borrower shall, and Agent may, at its option, instruct all suppliers, carriers,
forwarders, warehousers or others receiving or holding cash, checks, Inventory,
documents or instruments in which Agent holds a security interest to deliver
same to Agent and/or subject to Agent’s order and if they shall come into any
Borrower’s possession, they, and each of them, shall be held by such Borrower in
trust as Agent’s trustee, and such Borrower will immediately deliver them to
Agent in their original form together with any necessary endorsement.

4.7. Books and Records. Each Borrower shall (a) keep proper books of record and
account in which full, true and correct entries will be made of all dealings or
transactions of or in relation to its business and affairs; (b) set up on its
books accruals with respect to all taxes, assessments, charges, levies and
claims; and (c) on a reasonably current basis set up on its books, from its
earnings, allowances against doubtful Receivables, advances and investments and
all other proper accruals (including by reason of enumeration, accruals for
premiums, if any, due on required payments and accruals for depreciation,
obsolescence, or amortization of properties), which should be set aside from
such earnings in connection with its business. All determinations pursuant to
this subsection shall be made in accordance with, or as required by, GAAP
consistently applied in the opinion of such independent public accountant as
shall then be regularly engaged by Borrowers.

4.8. Financial Disclosure. Each Borrower hereby irrevocably authorizes and
directs all accountants and auditors employed by such Borrower at any time
during the Term to exhibit and deliver to Agent and each Lender copies of any of
such Borrower’s financial statements, trial balances or other accounting records
of any sort in the accountant’s or auditor’s possession, and to disclose to
Agent and each Lender any information such accountants may have concerning such
Borrower’s financial status and business operations. Each Borrower hereby
authorizes all Governmental Bodies to furnish to Agent and each Lender copies of
reports or examinations relating to such Borrower, whether made by such Borrower
or otherwise; however, Agent and each Lender will attempt to obtain such
information or materials directly from such Borrower prior to obtaining such
information or materials from such accountants or Governmental Bodies.

4.9. Compliance with Laws. Each Borrower shall comply with all Applicable Laws
with respect to the Collateral or any part thereof or to the operation of such
Borrower’s business the non-compliance with which could reasonably be expected
to have a Material Adverse Effect. The assets of Borrowers at all times shall be
maintained in accordance with the requirements of all insurance carriers which
provide insurance with respect to the assets of Borrowers so that such insurance
shall remain in full force and effect.

4.10. Inspection of Premises. At all reasonable times Agent and each Lender
shall have

 

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full access to and the right to audit, check, inspect and make abstracts and
copies from each Borrower’s books, records, audits, correspondence and all other
papers relating to the Collateral and the operation of each Borrower’s business
and Agent shall conduct not less than three (3) such field examinations in each
calendar year; provided that, so long as no Default or Event of Default has
occurred and is continuing, Borrowers shall not be obligated to pay the costs,
fees and expenses in connection with more than four (4) such field examinations
in any consecutive twelve-month period. Agent, any Lender and their agents may
enter upon any premises of any Borrower at any time during business hours and at
any other reasonable time, and from time to time, for the purpose of inspecting
the Collateral and any and all records pertaining thereto and the operation of
such Borrower’s business.

4.11. Insurance.

(a) The assets and properties of each Borrower at all times shall be maintained
in accordance with the requirements of all insurance carriers which provide
insurance with respect to the assets and properties of such Borrower so that
such insurance shall remain in full force and effect. Each Borrower shall bear
the full risk of any loss of any nature whatsoever with respect to the
Collateral. At each Borrower’s own cost and expense in amounts and with carriers
acceptable to Agent, each Borrower shall (a) keep all its insurable properties
and properties in which such Borrower has an interest insured against the
hazards of fire, flood (including for any Real Property located in a Special
Flood Area, Federal Flood Insurance or private insurance that meets the
requirements set forth by FEMA, in its Mandatory Purchase of Flood Insurance
Guidelines), sprinkler leakage, those hazards covered by extended coverage
insurance and such other hazards, and for such amounts, as is customary in the
case of companies engaged in businesses similar to such Borrower’s including
business interruption insurance; (b) maintain a bond in such amounts as is
customary in the case of companies engaged in businesses similar to such
Borrower insuring against larceny, embezzlement or other criminal
misappropriation of insured’s officers and employees who may either singly or
jointly with others at any time have access to the assets or funds of such
Borrower either directly or through authority to draw upon such funds or to
direct generally the disposition of such assets; (c) maintain public and product
liability insurance against claims for personal injury, death or property damage
suffered by others; (d) maintain all such worker’s compensation or similar
insurance as may be required under the laws of any state or jurisdiction in
which such Borrower is engaged in business; (e) furnish Agent with (i) copies of
all policies and evidence of the maintenance of such policies by the renewal
thereof at least thirty (30) days before any expiration date, and
(ii) appropriate loss payable endorsements in form and substance satisfactory to
Agent, naming Agent as a co-insured and lender loss payee as its interests may
appear with respect to all insurance coverage referred to in clauses (a), and
(c) above, and providing (A) that all proceeds thereunder shall be payable to
Agent, (B) no such insurance shall be affected by any act or neglect of the
insured or owner of the property described in such policy, and (C) that such
policy and lender loss payable clauses may not be cancelled, amended or
terminated unless at least thirty (30) days’ prior written notice is given to
Agent. In the event of any loss thereunder, the carriers named therein hereby
are directed by Agent and the applicable Borrower to make payment for such loss
to Agent and not to such Borrower and Agent jointly. If any insurance losses are
paid by check, draft or other instrument payable to any Borrower and Agent
jointly, Agent may endorse such Borrower’s name thereon and do such other things
as Agent may deem advisable to reduce the same to cash. Agent is hereby
authorized to adjust and

 

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compromise claims under insurance coverage referred to in clauses (a) and
(b) above. All loss recoveries received by Agent upon any such insurance may be
applied to the Obligations, in such order as Agent in its sole discretion shall
determine. Any surplus shall be paid by Agent to Borrowers or applied as may be
otherwise required by law. Any deficiency thereon shall be paid by Borrowers to
Agent, on demand.

(b) Each Borrower shall take all actions required under the Flood Laws and/or
requested by Agent to assist in ensuring that each Lender is in compliance with
the Flood Laws applicable to the Collateral, including, but not limited to,
providing Agent with the address and/or GPS coordinates of each structure on any
real property that will be subject to a mortgage in favor of Agent, for the
benefit of the Lenders, and, to the extent required, obtaining flood insurance
for such property, structures and contents prior to such property, structures
and contents becoming Collateral, and thereafter maintaining such flood
insurance in full force and effect for so long as required by the Flood Laws.

4.12. Failure to Pay Insurance. If any Borrower fails to obtain insurance as
hereinabove provided, or to keep the same in force, Agent, if Agent so elects,
may obtain such insurance and pay the premium therefor on behalf of such
Borrower, and charge Borrowers’ Account therefor as a Revolving Advance of a
Domestic Rate Loan and such expenses so paid shall be part of the Obligations.

4.13. Payment of Taxes. Each Borrower will pay, when due, all taxes, assessments
and other Charges lawfully levied or assessed upon such Borrower or any of the
Collateral including real and personal property taxes, assessments and charges
and all franchise, income, employment, social security benefits, withholding,
and sales taxes. If any tax by any Governmental Body is or may be imposed on or
as a result of any transaction between any Borrower and Agent or any Lender
which Agent or any Lender may be required to withhold or pay or if any taxes,
assessments, or other Charges remain unpaid after the date fixed for their
payment, or if any claim shall be made which, in Agent’s or any Lender’s
opinion, may possibly create a valid Lien on the Collateral, Agent may without
notice to Borrowers pay the taxes, assessments or other Charges and each
Borrower hereby indemnifies and holds Agent and each Lender harmless in respect
thereof. The amount of any payment by Agent under this Section 4.13 shall be
charged to Borrowers’ Account as a Revolving Advance maintained as a Domestic
Rate Loan and added to the Obligations and, until Borrowers shall furnish Agent
with an indemnity therefor (or supply Agent with evidence satisfactory to Agent
that due provision for the payment thereof has been made), Agent may hold
without interest any balance standing to Borrowers’ credit and Agent shall
retain its security interest in and Lien on any and all Collateral held by
Agent.

4.14. Payment of Leasehold Obligations. Each Borrower shall at all times pay,
when and as due, its rental obligations under all leases under which it is a
tenant, and shall otherwise comply, in all material respects, with all other
terms of such leases and keep them in full force and effect and, at Agent’s
request will provide evidence of having done so.

4.15. Receivables.

(a) Nature of Receivables. Each of the Receivables shall be a bona fide and

 

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valid account representing a bona fide indebtedness incurred by the Customer
therein named, for a fixed sum as set forth in the invoice relating thereto
(provided immaterial or unintentional invoice errors shall not be deemed to be a
breach hereof) with respect to an absolute sale or lease and (other than with
respect to Off-load Receivables) delivery of goods upon stated terms of a
Borrower, or work, labor or services theretofore rendered by a Borrower as of
the date each Receivable is created. Same shall be due and owing in accordance
with the applicable Borrower’s standard terms of sale without dispute, setoff or
counterclaim except as may be stated on the accounts receivable schedules
delivered by Borrowers to Agent.

(b) Solvency of Customers. Each Customer, to the best of each Borrower’s
knowledge, as of the date each Receivable is created, is and will be solvent and
able to pay all Receivables on which the Customer is obligated in full when due
or with respect to such Customers of any Borrower who are not solvent such
Borrower has set up on its books and in its financial records bad debt reserves
adequate to cover such Receivables.

(c) Location of Borrowers. Each Borrower’s chief executive office is located at
9420 Underwood Ave., Suite 100, Omaha, Nebraska. Until written notice is given
to Agent by Borrowing Agent of any other office at which any Borrower keeps its
records pertaining to Receivables, all such records shall be kept at such
executive office.

(d) Collection of Receivables. Until any Borrower’s authority to do so is
terminated by Agent (which notice Agent may give at any time following the
occurrence of an Event of Default or a Default or when Agent in its sole
discretion deems it to be in Lenders’ best interest to do so), each Borrower
will, at such Borrower’s sole cost and expense, but on Agent’s behalf and for
Agent’s account, collect as Agent’s property and in trust for Agent all amounts
received on Receivables, and shall not commingle such collections with any
Borrower’s funds or use the same except to pay Obligations. Each Borrower shall
deposit in the Blocked Account or, upon request by Agent, deliver to Agent, in
original form and on the date of receipt thereof, all checks, drafts, notes,
money orders, acceptances, cash and other evidences of Indebtedness.

(e) Notification of Assignment of Receivables. At any time following the
occurrence of a Default or an Event of Default, Agent shall have the right to
send notice of the assignment of, and Agent’s security interest in and Lien on,
the Receivables to any and all Customers or any third party holding or otherwise
concerned with any of the Collateral. Thereafter, Agent shall have the sole
right to collect the Receivables, take possession of the Collateral, or both.
Agent’s actual collection expenses, including, but not limited to, stationery
and postage, telephone and telegraph, secretarial and clerical expenses and the
salaries of any collection personnel used for collection, may be charged to
Borrowers’ Account and added to the Obligations.

(f) Power of Agent to Act on Borrowers’ Behalf. Agent shall have the right to
receive, endorse, assign and/or deliver in the name of Agent or any Borrower any
and all checks, drafts and other instruments for the payment of money relating
to the Receivables, and each Borrower hereby waives notice of presentment,
protest and non-payment of any instrument so endorsed. Each Borrower hereby
constitutes Agent or Agent’s designee as such Borrower’s attorney with power
(i) at any time: (A) to endorse such Borrower’s name upon any notes,
acceptances, checks, drafts, money orders or other evidences of payment or
Collateral; (B) to

 

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sign such Borrower’s name on any invoice, bill of lading or customs
documentation relating to any of the Receivables or Inventory, drafts against
Customers, assignments and verifications of Receivables; (C) to send
verifications of Receivables to any Customer; (D) to sign such Borrower’s name
on all financing statements or any other documents or instruments deemed
necessary or appropriate by Agent to preserve, protect, or perfect Agent’s
interest in the Collateral and to file same; and (ii) at any time following the
occurrence of a Default or Event of Default: (A) to demand payment of the
Receivables; (B) to enforce payment of the Receivables by legal proceedings or
otherwise; (C) to exercise all of such Borrower’s rights and remedies with
respect to the collection of the Receivables and any other Collateral; (D) to
settle, adjust, compromise, extend or renew the Receivables; (E) to settle,
adjust or compromise any legal proceedings brought to collect Receivables;
(F) to prepare, file and sign such Borrower’s name on a proof of claim in
bankruptcy or similar document against any Customer; (G) to prepare, file and
sign such Borrower’s name on any notice of Lien, assignment or satisfaction of
Lien or similar document in connection with the Receivables; and (H) to do all
other acts and things necessary to carry out this Agreement. All acts of said
attorney or designee are hereby ratified and approved, and said attorney or
designee shall not be liable for any acts of omission or commission nor for any
error of judgment or mistake of fact or of law, unless done maliciously or with
gross (not mere) negligence (as determined by a court of competent jurisdiction
in a final non-appealable judgment); this power being coupled with an interest
is irrevocable while any of the Obligations remain unpaid. Agent shall have the
right at any time following the occurrence of an Event of Default or Default, to
change the address for delivery of mail addressed to any Borrower to such
address as Agent may designate and to receive, open and dispose of all mail
addressed to any Borrower.

(g) No Liability. Neither Agent nor any Lender shall, under any circumstances or
in any event whatsoever, have any liability for any error or omission or delay
of any kind occurring in the settlement, collection or payment of any of the
Receivables or any instrument received in payment thereof, or for any damage
resulting therefrom. Following the occurrence of an Event of Default or Default
Agent may, without notice or consent from any Borrower, sue upon or otherwise
collect, extend the time of payment of, compromise or settle for cash, credit or
upon any terms any of the Receivables or any other securities, instruments or
insurance applicable thereto and/or release any obligor thereof. Agent is
authorized and empowered to accept following the occurrence of an Event of
Default or Default the return of the goods represented by any of the
Receivables, without notice to or consent by any Borrower, all without
discharging or in any way affecting any Borrower’s liability hereunder.

(h) Establishment of a Lockbox Account, Dominion Account. All proceeds of
Collateral shall be deposited by Borrowers into either (i) a lockbox account,
dominion account or such other “blocked account” (“Blocked Accounts”)
established at a bank or banks (each such bank, a “Blocked Account Bank”)
pursuant to an arrangement with such Blocked Account Bank as may be selected by
Borrowing Agent and be acceptable to Agent or (ii) depository accounts
(“Depository Accounts”) established at the Agent for the deposit of such
proceeds. Each applicable Borrower, Agent and each Blocked Account Bank shall
enter into a deposit account control agreement in form and substance
satisfactory to Agent directing such Blocked Account Bank to transfer such funds
so deposited to Agent, either to any account maintained by Agent at said Blocked
Account Bank or by wire transfer to appropriate account(s) of Agent. All funds
deposited in such Blocked Accounts shall immediately become the property of
Agent and

 

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Borrowing Agent shall obtain the agreement by such Blocked Account Bank to waive
any offset rights against the funds so deposited. Neither Agent nor any Lender
assumes any responsibility for such blocked account arrangement, including any
claim of accord and satisfaction or release with respect to deposits accepted by
any Blocked Account Bank thereunder. All deposit accounts and investment
accounts of each Borrower and its Subsidiaries are set forth on Schedule
4.15(h). Agent shall apply all funds received by it from the Blocked Accounts
and/or Depository Accounts to the satisfaction of the Obligations (including the
cash collateralization of the Letters of Credit) in such order as Agent shall
determine in its sole discretion, provided that, in the absence of any Event of
Default, Agent shall apply all such funds representing collection of Receivables
first to the prepayment of Revolving Advances.

(i) Adjustments. No Borrower will, without Agent’s consent, compromise or adjust
any Receivables (or extend the time for payment thereof) or accept any returns
of merchandise or grant any additional discounts, allowances or credits thereon
except for those compromises, adjustments, returns, discounts, credits and
allowances as have been heretofore customary in the business of such Borrower.

4.16. Inventory. To the extent Inventory held for sale or lease has been
produced by any Borrower, it has been and will be produced by such Borrower in
accordance with the Federal Fair Labor Standards Act of 1938, as amended, and
all rules, regulations and orders thereunder.

4.17. Maintenance of Equipment. All material Equipment shall be maintained in
good operating condition and repair (reasonable wear and tear excepted) and all
necessary replacements of and repairs thereto shall be made so that the value
and operating efficiency of the Equipment shall be maintained and preserved. No
Borrower shall use or operate the Equipment in violation of any law, statute,
ordinance, code, rule or regulation. Each Borrower shall have the right to sell
Equipment to the extent set forth in Section 4.3 hereof.

4.18. Exculpation of Liability. Nothing herein contained shall be construed to
constitute Agent or any Lender as any Borrower’s agent for any purpose
whatsoever, nor shall Agent or any Lender be responsible or liable for any
shortage, discrepancy, damage, loss or destruction of any part of the Collateral
wherever the same may be located and regardless of the cause thereof. Neither
Agent nor any Lender, whether by anything herein or in any assignment or
otherwise, assume any of any Borrower’s obligations under any contract or
agreement assigned to Agent or such Lender, and neither Agent nor any Lender
shall be responsible in any way for the performance by any Borrower of any of
the terms and conditions thereof.

4.19. Environmental Matters.

(a) Borrowers shall ensure that the Real Property and all operations and
businesses conducted thereon remains in compliance with all Environmental Laws
and they shall not place or permit to be placed any Hazardous Substances on any
Real Property except as permitted by Applicable Law or appropriate governmental
authorities.

(b) Borrowers shall establish and maintain a system to assure and monitor
continued compliance with all applicable Environmental Laws which system shall
include periodic reviews of such compliance.

 

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(c) Borrowers shall (i) employ in connection with the use of the Real Property
appropriate technology necessary to maintain compliance with any applicable
Environmental Laws and (ii) dispose of any and all Hazardous Waste generated at
the Real Property only at facilities and with carriers that maintain valid
permits under RCRA and any other applicable Environmental Laws. Borrowers shall
use their best efforts to obtain certificates of disposal, such as hazardous
waste manifest receipts, from all treatment, transport, storage or disposal
facilities or operators employed by Borrowers in connection with the transport
or disposal of any Hazardous Waste generated at the Real Property.

(d) In the event any Borrower obtains, gives or receives notice of any Release
or threat of Release of a reportable quantity of any Hazardous Substances at the
Real Property (any such event being hereinafter referred to as a “Hazardous
Discharge”) or receives any notice of violation, request for information or
notification that it is potentially responsible for investigation or cleanup of
environmental conditions at the Real Property, demand letter or complaint,
order, citation, or other written notice with regard to any Hazardous Discharge
or violation of Environmental Laws affecting the Real Property or any Borrower’s
interest therein (any of the foregoing is referred to herein as an
“Environmental Complaint”) from any Person, including any state agency
responsible in whole or in part for environmental matters in the state in which
the Real Property is located or the United States Environmental Protection
Agency (any such person or entity hereinafter the “Authority”), then Borrowing
Agent shall, within five (5) Business Days, give written notice of same to Agent
detailing facts and circumstances of which any Borrower is aware giving rise to
the Hazardous Discharge or Environmental Complaint. Such information is to be
provided to allow Agent to protect its security interest in and Lien on the Real
Property and the Collateral and is not intended to create nor shall it create
any obligation upon Agent or any Lender with respect thereto.

(e) Borrowing Agent shall promptly forward to Agent copies of any request for
information, notification of potential liability, demand letter relating to
potential responsibility with respect to the investigation or cleanup of
Hazardous Substances at any other site owned, operated or used by any Borrower
to dispose of Hazardous Substances and shall continue to forward copies of
correspondence between any Borrower and the Authority regarding such claims to
Agent until the claim is settled. Borrowing Agent shall promptly forward to
Agent copies of all documents and reports concerning a Hazardous Discharge at
the Real Property that any Borrower is required to file under any Environmental
Laws. Such information is to be provided solely to allow Agent to protect
Agent’s security interest in and Lien on the Real Property and the Collateral.

(f) Borrowers shall respond promptly to any Hazardous Discharge or Environmental
Complaint and take all necessary action in order to safeguard the health of any
Person and to avoid subjecting the Collateral or Real Property to any Lien. If
any Borrower shall fail to respond promptly to any Hazardous Discharge or
Environmental Complaint or any Borrower shall fail to comply with any of the
requirements of any Environmental Laws, Agent on behalf of Lenders may, but
without the obligation to do so, for the sole purpose of protecting Agent’s
interest in the Collateral: (i) give such notices or (ii) enter onto the Real
Property (or authorize third parties to enter onto the Real Property) and take
such actions as Agent (or such third parties as directed by Agent) deem
reasonably necessary or advisable, to clean up, remove, mitigate or otherwise
deal with any such Hazardous Discharge or Environmental Complaint. All

 

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reasonable costs and expenses incurred by Agent and Lenders (or such third
parties) in the exercise of any such rights, including any sums paid in
connection with any judicial or administrative investigation or proceedings,
fines and penalties, together with interest thereon from the date expended at
the Default Rate for Domestic Rate Loans constituting Revolving Advances shall
be paid upon demand by Borrowers, and until paid shall be added to and become a
part of the Obligations secured by the Liens created by the terms of this
Agreement or any other agreement between Agent, any Lender and any Borrower.

(g) Promptly upon the written request of Agent from time to time, Borrowers
shall provide Agent, at Borrowers’ expense, with an environmental site
assessment or environmental audit report prepared by an environmental
engineering firm acceptable in the reasonable opinion of Agent, to assess with a
reasonable degree of certainty the existence of a Hazardous Discharge and the
potential costs in connection with abatement, cleanup and removal of any
Hazardous Substances found on, under, at or within the Real Property. Any report
or investigation of such Hazardous Discharge proposed and acceptable to an
appropriate Authority that is charged to oversee the clean-up of such Hazardous
Discharge shall be acceptable to Agent. If such estimates, individually or in
the aggregate, exceed $100,000, Agent shall have the right to require Borrowers
to post a bond, letter of credit or other security reasonably satisfactory to
Agent to secure payment of these costs and expenses.

(h) Borrowers shall defend and indemnify Agent and Lenders and hold Agent,
Lenders and their respective employees, agents, directors and officers harmless
from and against all loss, liability, damage and expense, claims, costs, fines
and penalties, including attorney’s fees, suffered or incurred by Agent or
Lenders under or on account of any Environmental Laws, including the assertion
of any Lien thereunder, with respect to any Hazardous Discharge, the presence of
any Hazardous Substances affecting the Real Property, whether or not the same
originates or emerges from the Real Property or any contiguous real estate,
including any loss of value of the Real Property as a result of the foregoing
except to the extent such loss, liability, damage and expense is attributable to
any Hazardous Discharge resulting from actions on the part of Agent or any
Lender. Borrowers’ obligations under this Section 4.19 shall arise upon the
discovery of the presence of any Hazardous Substances at the Real Property,
whether or not any federal, state, or local environmental agency has taken or
threatened any action in connection with the presence of any Hazardous
Substances. Borrowers’ obligation and the indemnifications hereunder shall
survive the termination of this Agreement.

(i) For purposes of Section 4.19 and 5.7, all references to Real Property shall
be deemed to include all of each Borrower’s right, title and interest in and to
its owned and leased premises.

4.20. Financing Statements. Except as respects the financing statements filed by
Agent and the financing statements described on Schedule 1.2, no financing
statement covering any of the Collateral or any proceeds thereof is on file in
any public office.

4.21. Real Estate. In the event Borrowers, or any of them, acquire any Real
Property, Borrowers shall execute and deliver any and all agreements, documents
and instruments requested by Agent to enable Agent to have a first priority Lien
on such Real Property, including, without limitation, (i) a mortgage in favor of
Agent to secure the Obligations; (ii)

 

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ALTA survey acceptable to remove any survey exceptions from the title policy
issued to Agent insuring the mortgage; (iii) ALTA title insurance (with
endorsements reasonably acceptable to Agent, which shall include a zoning
endorsement) issued to Agent insuring the mortgage in favor of Agent referenced
above as a first Lien on such Real Property; (iv) a Phase I environmental
report, in form and substance reasonably acceptable to Agent; (v) a Flood
certificate, in form and substance reasonably acceptable to Agent and, if such
real estate is located in a Special Flood Area, Federal Flood Insurance as
required by Section 4.11; and (vi) a real estate appraisal complying with FIRREA
and otherwise, in form and substance reasonably acceptable to Agent.

4.22. Appraisals. Agent may, in its Permitted Discretion, exercised in a
commercially reasonable manner, at any time after the Closing Date, engage the
services of an independent appraisal firm or firms of reputable standing,
satisfactory to Agent, for the purpose of appraising the then current values of
Borrowers’ Inventory. Absent the occurrence and continuance of an Event of
Default at such time, Agent shall consult with Borrowers as to the identity of
any such firm. All of the fees and out-of-pocket costs and expense of any such
firm (collectively, “appraisal amounts”) shall be paid for when due, in full and
without off-set, by Borrowers; provided, however, Borrowers shall not be
obligated to pay such appraisal amounts if no Default or Event of Default has
occurred. In the event the value of Borrowers’ Inventory, as so determined
pursuant to such appraisal, is less than anticipated by Agent or Lenders, such
that the Revolving Advances against Eligible In-Tank Inventory, Eligible
In-Transit Inventory, Eligible On-Track Inventory and Eligible Stored Natural
Gas Inventory are in fact in excess of such Advances permitted hereunder, then,
promptly upon Agent’s written demand for same, Borrowers shall make mandatory
prepayments of the then outstanding Revolving Advances made against such
Eligible Inventory so as to eliminate the excess Advances.

 

V. REPRESENTATIONS AND WARRANTIES.

Each Borrower represents and warrants as follows:

5.1. Authority. Each Borrower has full power, authority and legal right to enter
into this Agreement and the Other Documents and to perform all its respective
Obligations hereunder and thereunder. This Agreement, the Subordination
Agreement and the Other Documents have been duly executed and delivered by each
Borrower, and this Agreement, the Subordination Agreement and the Other
Documents constitute the legal, valid and binding obligation of such Borrower
enforceable in accordance with their terms, except as such enforceability may be
limited by any applicable bankruptcy, insolvency, moratorium or similar laws
affecting creditors’ rights generally. The execution, delivery and performance
of this Agreement and of the Other Documents (a) are within such Borrower’s
limited liability company powers, have been duly authorized by all necessary
company action, are not in contravention of law or the terms of such Borrower’s
operating agreement, certificate of formation or other applicable documents
relating to such Borrower’s formation or to the conduct of such Borrower’s
business or of any material agreement or undertaking to which such Borrower is a
party or by which such Borrower is bound, including the Subordinated Loan
Documentation (b) will not conflict with or violate any law or regulation, or
any judgment, order or decree of any Governmental Body, (c) will not require the
Consent of any Governmental Body or any other Person, except those Consents set
forth on Schedule 5.1 hereto, all of which will have been duly obtained, made or
compiled prior to the Closing Date and which are in full force and effect and
(d) will not conflict

 

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with, nor result in any breach in any of the provisions of or constitute a
default under or result in the creation of any Lien except Permitted
Encumbrances upon any asset of such Borrower under the provisions of any
agreement, charter document, instrument, operating agreement or other instrument
to which such Borrower is a party or by which it or its property is a party or
by which it may be bound.

5.2. Formation and Qualification.

(a) Each Borrower is duly formed and in good standing under the laws of the
state listed on Schedule 5.2(a) and is qualified to do business and is in good
standing in the states listed on Schedule 5.2(a) which constitute all states in
which qualification and good standing are necessary for such Borrower to conduct
its business and own its property and where the failure to so qualify could
reasonably be expected to have a Material Adverse Effect on such Borrower. Each
Borrower has delivered to Agent true and complete copies of its certificate of
formation and operating agreement and will promptly notify Agent of any
amendment or changes thereto.

(b) The only Subsidiaries of each Borrower are listed on Schedule 5.2(b).

5.3. Survival of Representations and Warranties. All representations and
warranties of such Borrower contained in this Agreement and the Other Documents
shall be true at the time of such Borrower’s execution of this Agreement and the
Other Documents, and shall survive the execution, delivery and acceptance
thereof by the parties thereto and the closing of the transactions described
therein or related thereto.

5.4. Tax Returns. Each Borrower’s federal tax identification number is set forth
on Schedule 5.4. Each Borrower has filed all federal and material state and
local tax returns and other reports each is required by law to file and has paid
all taxes, assessments, fees and other governmental charges that are due and
payable. Federal, state and local income tax returns of each Borrower have been
examined and reported upon by the appropriate taxing authority or closed by
applicable statute and satisfied for all fiscal years prior to and including the
fiscal year ending December 31, 2009. The provision for taxes on the books of
each Borrower is adequate for all years not closed by applicable statutes, and
for its current fiscal year, and no Borrower has any knowledge of any material
deficiency or additional assessment in connection therewith not provided for on
its books.

5.5. Financial Statements.

(a) The pro forma balance sheet of Borrowers on a Consolidated Basis (the “Pro
Forma Balance Sheet”) furnished to Agent for the most recent accounting period
prior to or on the Closing Date reflects the consummation of the transactions
contemplated under this Agreement (collectively, the “Transactions”) and is
accurate, complete and correct and fairly reflects the financial condition of
Borrowers on a Consolidated Basis as of the Closing Date after giving effect to
the Transactions, and has been prepared in accordance with GAAP principles,
consistently applied. The Pro Forma Balance Sheet has been certified as
accurate, complete and correct in all material respects by the President, Chief
Financial Officer, Treasurer or Controller of Borrowing Agent. All financial
statements referred to in this subsection 5.5(a), including the related
schedules and notes thereto, have been prepared, in accordance with GAAP, except
for the omission of footnotes and as may be disclosed in such financial
statements.

 

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(b) The twelve-month cash flow projections and projected balance sheets of
Borrowers on a Consolidated Basis as of the Closing Date, copies of which are
annexed hereto as Exhibit 5.5(b) (the “Projections”) were prepared by the Chief
Financial Officer, Treasurer or Controller of GPTG, are based on underlying
assumptions which provide a reasonable basis for the projections contained
therein and reflect Borrowers’ judgment based on present circumstances of the
most likely set of conditions and course of action for the projected period. The
Projections together with the Pro Forma Balance Sheet, are referred to as the
“Pro Forma Financial Statements”.

(c) The consolidated and consolidating balance sheets of Holdings, their
Subsidiaries and such other Persons described therein (including the accounts of
all Subsidiaries for the respective periods during which a subsidiary
relationship existed) as of December 31, 2013, and the related statements of
income, changes in stockholder’s equity, and changes in cash flow for the period
ended on such date, all accompanied by reports thereon containing opinions
without qualification by independent certified public accountants, copies of
which have been delivered to Agent, have been prepared in accordance with GAAP,
consistently applied (except for changes in application in which such
accountants concur) and present fairly the financial position of Borrowers and
their Subsidiaries at such date and the results of their operations for such
period. The consolidated and consolidating balance sheets of Borrowers, their
Subsidiaries and such other Persons described therein (including the accounts of
all Subsidiaries for the respective periods during which a subsidiary
relationship existed) as of December 31, 2013, and the related statements of
income, changes in stockholder’s equity, and changes in cash flow for the period
ended on such date, present fairly the financial position of Borrowers and their
Subsidiaries at such date and the results of their operations for such period.
Since December 31, 2013 there has been no change in the condition, financial or
otherwise, of Borrowers or their Subsidiaries as shown on the consolidated
balance sheet as of such date and no change in the aggregate value of machinery,
equipment and Real Property owned by Borrowers and their respective
Subsidiaries, except changes in the Ordinary Course of Business, none of which
individually or in the aggregate has been materially adverse.

5.6. Entity Names. No Borrower has been known by any other corporate name in the
past five years and does not sell Inventory under any other name except as set
forth on Schedule 5.6, nor has any Borrower been the surviving company of a
merger or consolidation or acquired all or substantially all of the assets of
any Person during the preceding five (5) years.

5.7. O.S.H.A. Environmental Compliance; Flood Insurance.

(a) Each Borrower is in compliance with, and its facilities, business, assets,
property, leaseholds, Real Property and Equipment are in compliance with the
Federal Occupational Safety and Health Act, and Environmental Laws and there are
no outstanding citations, notices or orders of non-compliance issued to any
Borrower or relating to its business, assets, property, leaseholds or Equipment
under any such laws, rules or regulations.

 

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(b) Each Borrower has been issued all required federal, state and local
licenses, certificates or permits (collectively, “Approvals”) relating to all
applicable Environmental Laws and all such Approvals are current and in full
force and effect.

(c) (i) there have been no releases, spills, discharges, leaks or disposal
(collectively referred to as “Releases”) of Hazardous Substances at, upon, under
or migrating from or onto any Real Property owned, leased or occupied by any
Borrower, except for those Releases which are in full compliance with
Environmental Laws; (ii) there are no underground storage tanks or
polychlorinated biphenyls on any Real Property owned, leased or occupied by any
Borrower, except for such underground storage tanks or polychlorinated biphenyls
that are present in compliance with Environmental Laws; (iii) the Real Property
including any premises owned, leased or occupied by any Borrower has never been
used by any Borrower to dispose of Hazardous Substances, except as authorized by
Environmental Laws; and (iv) no Hazardous Substances are managed by any Borrower
on any Real Property including any premises owned, leased or occupied by any
Borrower, excepting such quantities as are managed in accordance with all
applicable manufacturer’s instructions and compliance with Environmental Laws
and as are necessary for the operation of the commercial business of any
Borrower or of its tenants.

(d) All Real Property owned by Borrowers is insured pursuant to policies and
other bonds which are valid and in full force and effect and which provide
adequate coverage from reputable and financially sound insurers in amounts
sufficient to insure the assets and risks of each such Borrower in accordance
with prudent business practice in the industry of such Borrower. Each Borrower
has taken all actions required under the Flood Laws and/or requested by Agent to
assist in ensuring that each Lender is in compliance with the Flood Laws
applicable to the Collateral, including, but not limited to, providing Agent
with the address and/or GPS coordinates of each structure located upon any Real
Property that will be subject to a Mortgage in favor of Agent, for the benefit
of Lenders, and, to the extent required, obtaining flood insurance for such
property, structures and contents prior to such property, structures and
contents becoming Collateral.

5.8. Solvency; No Litigation, Violation, Indebtedness or Default; ERISA
Compliance.

(a) After giving effect to the Transactions, each Borrower will be solvent, able
to pay its debts as they mature, will have capital sufficient to carry on its
business and all businesses in which it is about to engage, and (i) as of the
Closing Date, the fair present saleable value of its assets, calculated on a
going concern basis, is in excess of the amount of its liabilities and
(ii) subsequent to the Closing Date, the fair saleable value of its assets
(calculated on a going concern basis) will be in excess of the amount of its
liabilities.

(b) Except as disclosed in Schedule 5.8(b), no Borrower has (i) any pending or
threatened litigation, arbitration, actions or proceedings which involve the
possibility of having a Material Adverse Effect, and (ii) any liabilities or
indebtedness for borrowed money other than the Obligations.

(c) No Borrower is in violation of any applicable statute, law, rule, regulation
or ordinance in any respect which could reasonably be expected to have a
Material Adverse Effect, nor is any Borrower in violation of any order of any
court, Governmental Body or arbitration board or tribunal.

 

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(d) No Borrower or any member of the Controlled Group maintains or is required
to contribute to any Plan other than those listed on Schedule 5.8(d) hereto.
Each Plan is in compliance in all material respects with the applicable
provisions of ERISA, the Code and other Applicable Laws. (i) Each Borrower and
each member of the Controlled Group has met all applicable minimum funding
requirements under Section 302 of ERISA and Section 412 of the Code in respect
of each Plan, and each Plan is in compliance with Sections 412, 430 and 436 of
the Code and Sections 206(g), 302 and 303 of ERISA, without regard to waivers
and variances; (ii) each Plan which is intended to be a qualified plan under
Section 401(a) of the Code as currently in effect has been determined by the
Internal Revenue Service to be qualified under Section 401(a) of the Code and
the trust related thereto is exempt from federal income tax under Section 501(a)
of the Code or an application for such a determination is currently being
processed by the Internal Revenue Service; (iii) neither any Borrower nor any
member of the Controlled Group has incurred any liability to the PBGC other than
for the payment of premiums, and there are no premium payments which have become
due which are unpaid; (iv) no Plan has been terminated by the plan administrator
thereof nor by the PBGC, and there is no occurrence which would cause the PBGC
to institute proceedings under Title IV of ERISA to terminate any Plan; (v) the
current value of the assets of each Plan exceeds the present value of the
accrued benefits and other liabilities of such Plan and neither any Borrower nor
any member of the Controlled Group knows of any facts or circumstances which
would materially change the value of such assets and accrued benefits and other
liabilities; (vi) neither any Borrower nor any member of the Controlled Group
has breached any of the responsibilities, obligations or duties imposed on it by
ERISA with respect to any Plan; (vii) neither any Borrower nor any member of the
Controlled Group has incurred any liability for any excise tax arising under
Section 4971, 4972 or 4980B of the Code, and no fact exists which could give
rise to any such liability; (viii) neither any Borrower nor any member of the
Controlled Group nor any fiduciary of, nor any trustee to, any Plan, has engaged
in a “prohibited transaction” described in Section 406 of ERISA or Section 4975
of the Code nor taken any action which would constitute or result in a
Termination Event with respect to any such Plan which is subject to ERISA;
(ix) no Termination Event has occurred or is reasonably expected to occur;
(x) there exists no Reportable ERISA Event; (xi) neither any Borrower nor any
member of the Controlled Group has engaged in a transaction that could be
subject to Section 4069 or 4212(c) of ERISA; (xii) neither any Borrower nor any
member of the Controlled Group maintains or is required to contribute to any
Plan which provides health, accident or life insurance benefits to former
employees, their spouses or dependents, other than in accordance with
Section 4980B of the Code; (xiii) neither any Borrower nor any member of the
Controlled Group has withdrawn, completely or partially, within the meaning of
Section 4203 or 4205 of ERISA, from any Multiemployer Plan so as to incur
liability under the Multiemployer Pension Plan Amendments Act of 1980 and there
exists no fact which would reasonably be expected to result in any such
liability; and (xiv) no Plan fiduciary (as defined in Section 3(21) of ERISA)
has any liability for breach of fiduciary duty or for any failure in connection
with the administration or investment of the assets of a Plan.

5.9. Patents, Trademarks, Copyrights and Licenses. All patents, patent
applications, trademarks, trademark applications, service marks, service mark
applications, copyrights, copyright applications, design rights, tradenames,
assumed names, trade secrets and licenses owned or utilized by any Borrower are
set forth on Schedule 5.9, are valid and have been duly

 

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registered or filed with all appropriate Governmental Bodies and constitute all
of the intellectual property rights which are necessary for the operation of its
business; there is no objection to or pending challenge to the validity of any
such patent, trademark, copyright, design rights, tradename, trade secret or
license and no Borrower is aware of any grounds for any challenge, except as set
forth in Schedule 5.9 hereto. Each patent, patent application, patent license,
trademark, trademark application, trademark license, service mark, service mark
application, service mark license, design rights, copyright, copyright
application and copyright license owned or held by any Borrower and all trade
secrets used by any Borrower consist of original material or property developed
by such Borrower or was lawfully acquired by such Borrower from the proper and
lawful owner thereof. Each of such items has been maintained so as to preserve
the value thereof from the date of creation or acquisition thereof. With respect
to all software used by any Borrower, such Borrower is in possession of all
source and object codes related to each piece of software or is the beneficiary
of a source code escrow agreement, each such source code escrow agreement being
listed on Schedule 5.9 hereto.

5.10. Licenses and Permits. Except as set forth in Schedule 5.10, each Borrower
(a) is in compliance with and (b) has procured and is now in possession of, all
material licenses or permits required by any applicable federal, state,
provincial or local law, rule or regulation for the operation of its business in
each jurisdiction wherein it is now conducting or proposes to conduct business
and where the failure to procure such licenses or permits could have a Material
Adverse Effect.

5.11. Default of Indebtedness. No Borrower is in default in the payment of the
principal of or interest on any Indebtedness or under any instrument or
agreement under or subject to which any Indebtedness has been issued and no
event has occurred under the provisions of any such instrument or agreement
which with or without the lapse of time or the giving of notice, or both,
constitutes or would constitute an event of default thereunder.

5.12. No Default. No Borrower is in default in the payment or performance of any
of its contractual obligations, the obligations under which are in excess of
$500,000, and no Default has occurred.

5.13. No Burdensome Restrictions. No Borrower is party to any contract or
agreement the performance of which could have a Material Adverse Effect. Each
Borrower has heretofore delivered to Agent true and complete copies of all
material contracts to which it is a party or to which it or any of its
properties is subject. No Borrower has agreed or consented to cause or permit in
the future (upon the happening of a contingency or otherwise) any of its
property, whether now owned or hereafter acquired, to be subject to a Lien which
is not a Permitted Encumbrance.

5.14. No Labor Disputes. No Borrower is involved in any labor dispute; there are
no strikes or walkouts or union organization of any Borrower’s employees
threatened or in existence and no labor contract is scheduled to expire during
the Term other than as set forth on Schedule 5.14 hereto.

5.15. Margin Regulations. No Borrower is engaged, nor will it engage,
principally or as one of its important activities, in the business of extending
credit for the purpose of

 

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“purchasing” or “carrying” any “margin stock” within the respective meanings of
each of the quoted terms under Regulation U of the Board of Governors of the
Federal Reserve System as now and from time to time hereafter in effect. No part
of the proceeds of any Advance will be used for “purchasing” or “carrying”
“margin stock” as defined in Regulation U of such Board of Governors.

5.16. Investment Company Act. No Borrower is an “investment company” registered
or required to be registered under the Investment Company Act of 1940, as
amended, nor is it controlled by such a company.

5.17. Disclosure. No representation or warranty made by any Borrower in this
Agreement, or in any financial statement, report, certificate or any other
document furnished in connection herewith contains any untrue statement of a
material fact or omits to state any material fact necessary to make the
statements herein or therein not misleading. There is no fact known to any
Borrower or which reasonably should be known to such Borrower which such
Borrower has not disclosed to Agent in writing with respect to the transactions
contemplated or evidenced by this Agreement which could reasonably be expected
to have a Material Adverse Effect.

5.18. Reserved.

5.19. Swaps. No Borrower is a party to, nor will it be a party to, any swap
agreement whereby such Borrower has agreed or will agree to swap interest rates
or currencies unless same provides that damages upon termination following an
event of default thereunder are payable on an unlimited “two-way basis” without
regard to fault on the part of either party.

5.20. Conflicting Agreements. No provision of any mortgage, indenture, contract,
agreement, judgment, decree or order binding on any Borrower or affecting the
Collateral conflicts with, or requires any Consent which has not already been
obtained to, or would in any way prevent the execution, delivery or performance
of, the terms of this Agreement or the Other Documents.

5.21. Application of Certain Laws and Regulations. Neither any Borrower nor any
Affiliate of any Borrower is subject to any law, statute, rule or regulation
which regulates the incurrence of any Indebtedness, including laws, statutes,
rules or regulations relative to common or interstate carriers or to the sale of
electricity, gas, steam, water, telephone, telegraph or other public utility
services.

5.22. Business and Property of Borrowers. Upon and after the Closing Date,
Borrowers do not propose to engage in any business other than the marketing of
ethanol and distillers grains and activities necessary to conduct the foregoing.
On the Closing Date and at all times thereafter, each Borrower owns all the
property and possess all of the rights and Consents necessary for the conduct of
the business of such Borrower.

5.23. Ineligible Securities. Borrowers do not intend to use and shall not use
any portion of the proceeds of the Advances, directly or indirectly, to purchase
during the underwriting period, or for 30 days thereafter, Ineligible Securities
being underwritten by a securities Affiliate of Agent or any Lender.

 

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5.24. Federal Securities Laws. Neither any Borrower nor any of its Subsidiaries
(i) is required to file periodic reports under the Exchange Act, (ii) has any
securities registered under the Exchange Act or (iii) has filed a registration
statement that has not yet become effective under the Securities Act.

5.25. Equity Interests. The authorized and outstanding Equity Interests of each
Borrower and Guarantor (other than Holdings) is as shown on Schedule 5.25
hereto. All of the Equity Interests of each Borrower has been duly and validly
authorized and issued and is fully paid and non-assessable and has been sold and
delivered to the holders hereof in compliance with, or under valid exemption
from, all federal and state laws and the rules and regulations of each
Governmental Body governing the sale and delivery of securities. Except for the
rights and obligations shown on Schedule 5.25, there are no subscriptions,
warrants, options, calls, commitments, rights or agreement by which any Borrower
or any of the shareholders of any Borrower is bound relating to the issuance,
transfer, voting or redemption of shares of its Equity Interests or any
pre-emptive rights held by any Person with respect to the Equity Interests of
Borrowers. Except as shown on Schedule 5.25, Borrowers have not issued any
securities convertible into or exchangeable for shares of its Equity Interests
or any options, warrants or other rights to acquire such shares or securities
convertible into or exchangeable for such shares.

5.26. Material Contracts. Schedule 5.26 sets forth all Material Contracts of the
Borrowers as of the Closing Date. All Material Contracts are in full force and
effect and no material defaults currently exist thereunder. No Borrower has
(i) received any notice of termination or non-renewal of any Material Contract,
or (ii) exercised any option to terminate or not to renew any Material Contract.

 

VI. AFFIRMATIVE COVENANTS.

Each Borrower shall, until payment in full of the Obligations and termination of
this Agreement:

6.1. Payment of Fees. Pay to Agent on demand all usual and customary fees and
expenses which Agent incurs in connection with (a) the forwarding of Advance
proceeds and (b) the establishment and maintenance of any Blocked Accounts or
Depository Accounts as provided for in Section 4.15(h). Agent may, without
making demand, charge Borrowers’ Account for all such fees and expenses.

6.2. Conduct of Business and Maintenance of Existence and Assets. (a) Conduct
continuously and operate actively its business according to good business
practices and maintain all of its properties useful or necessary in its business
in good working order and condition (reasonable wear and tear excepted and
except as may be disposed of in accordance with the terms of this Agreement),
including all licenses, patents, copyrights, design rights, tradenames, trade
secrets and trademarks and take all actions necessary to enforce and protect the
validity of any intellectual property right or other right included in the
Collateral; (b) keep in full force and effect its existence and comply in all
material respects with the laws and regulations governing the conduct of its
business where the failure to do so could reasonably be expected to have a
Material Adverse Effect; and (c) make all such reports and pay all such
franchise and other taxes and license fees and do all such other acts and things
as may be lawfully required to maintain its

 

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rights, licenses, leases, powers and franchises under the laws of the United
States or any political subdivision thereof where the failure to do so could
reasonably be expected to have a Material Adverse Effect.

6.3. Violations. Promptly notify Agent in writing of any violation of any law,
statute, regulation or ordinance of any Governmental Body, or of any agency
thereof, applicable to any Borrower which could reasonably be expected to have a
Material Adverse Effect.

6.4. Government Receivables. Take all steps necessary to protect Agent’s
interest in the Collateral under the Federal Assignment of Claims Act, the
Uniform Commercial Code and all other applicable state or local statutes or
ordinances and deliver to Agent appropriately endorsed, any instrument or
chattel paper connected with any Receivable arising out of contracts between any
Borrower and the United States, any state or any department, agency or
instrumentality of any of them.

6.5. Fixed Charge Coverage Ratio. Cause to be maintained as of the end of each
fiscal quarter, commencing with the fiscal quarter ending December 31, 2014, a
Fixed Charge Coverage Ratio of not less than 1.15 to 1.0, measured on a rolling
four quarter basis.

6.6. Execution of Supplemental Instruments. Execute and deliver to Agent from
time to time, upon demand, such supplemental agreements, statements, assignments
and transfers, or instructions or documents relating to the Collateral, and such
other instruments as Agent may request, in order that the full intent of this
Agreement may be carried into effect.

6.7. Payment of Indebtedness. Pay, discharge or otherwise satisfy at or before
maturity (subject, where applicable, to specified grace periods and, in the case
of the trade payables, to normal payment practices) all its obligations and
liabilities of whatever nature, except when the failure to do so could not
reasonably be expected to have a Material Adverse Effect or when the amount or
validity thereof is currently being contested in good faith by appropriate
proceedings and each Borrower shall have provided for such reserves as Agent may
reasonably deem proper and necessary, subject at all times to any applicable
subordination arrangement in favor of Lenders. Notwithstanding anything to the
contrary set forth above, Borrowers shall not prepay any of its obligations and
liabilities to any Affiliate.

6.8. Standards of Financial Statements. Cause all financial statements referred
to in Sections 9.7, 9.8, 9.9, 9.10, 9.11, 9.12, and 9.13 as to which GAAP is
applicable to be complete and correct in all material respects (subject, in the
case of interim financial statements, to the omission of footnotes and for the
effect of normal year-end audit adjustments) and to be prepared in reasonable
detail and in accordance with GAAP applied consistently throughout the periods
reflected therein (except as concurred in by such reporting accountants or
officer, as the case may be, and disclosed therein).

6.9. Federal Securities Laws. Promptly notify Agent in writing if Holdings, any
Borrower or any of its Subsidiaries (i) is required to file periodic reports
under the Exchange Act, (ii) registers any securities under the Exchange Act or
(iii) files a registration statement under the Securities Act.

6.10. Change in Management. Promptly notify Agent in writing if an executive
officer of Borrower holding position of President, Chief Executive Officer,
Chief Financial Officer or Treasurer is no longer employed by, and holding that
position at, GPTG or its parent.

 

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6.11. Keepwell. If it is a Qualified ECP Loan Party, then jointly and severally,
together with each other Qualified ECP Loan Party, hereby absolutely
unconditionally and irrevocably (a) guarantees the prompt payment and
performance of all Swap Obligations owing by each Non-Qualifying Party (it being
understood and agreed that this guarantee is a guaranty of payment and not of
collection), and (b) undertakes to provide such funds or other support as may be
needed from time to time by any Non-Qualifying Party to honor all of such
Non-Qualifying Party’s obligations under this Agreement or any Other Document in
respect of Swap Obligations (provided, however, that each Qualified ECP Loan
Party shall only be liable under this Section 6.11 for the maximum amount of
such liability that can be hereby incurred without rendering its obligations
under this Section 6.11, or otherwise under this Agreement or any Other
Document, voidable under applicable law, including applicable law relating to
fraudulent conveyance or fraudulent transfer, and not for any greater amount).
The obligations of each Qualified ECP Loan Party under this Section 6.11 shall
remain in full force and effect until payment in full of the Obligations and
termination of this Agreement and the Other Documents. Each Qualified ECP Loan
Party intends that this Section 6.11 constitute, and this Section 6.11 shall be
deemed to constitute, a guarantee of the obligations of, and a “keepwell,
support, or other agreement” for the benefit of each other Borrower and
Guarantor for all purposes of Section 1a(18)(A)(v)(II) of the CEA.

 

VII. NEGATIVE COVENANTS.

No Borrower shall, until satisfaction in full of the Obligations and termination
of this Agreement:

7.1. Merger, Consolidation, Acquisition and Sale of Assets.

(a) Enter into any merger, consolidation or other reorganization with or into
any other Person or acquire all or a substantial portion of the assets or Equity
Interests of any Person or permit any other Person to consolidate with or merge
with it.

(b) Sell, lease, transfer or otherwise dispose of any of its properties or
assets, except (i) dispositions of Inventory and Equipment to the extent
expressly permitted by Section 4.3 and (ii) any other sales or dispositions
expressly permitted by this Agreement.

7.2. Creation of Liens. Create or suffer to exist any Lien or transfer upon or
against any of its property or assets now owned or hereafter acquired, except
Permitted Encumbrances.

7.3. Guarantees. Become liable upon the obligations or liabilities of any Person
by assumption, endorsement or guaranty thereof or otherwise (other than to
Lenders) except the endorsement of checks in the Ordinary Course of Business.

7.4. Investments. Purchase or acquire obligations or Equity Interests of, or any
other interest in, any Person, except (a) obligations issued or guaranteed by
the United States of America or any agency thereof, (b) commercial paper with
maturities of not more than 180 days and a published rating of not less than A-1
or P-1 (or the equivalent rating), (c) certificates of

 

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time deposit and bankers’ acceptances having maturities of not more than 180
days and repurchase agreements backed by United States government securities of
a commercial bank if (i) such bank has a combined capital and surplus of at
least $500,000,000, or (ii) its debt obligations, or those of a holding company
of which it is a Subsidiary, are rated not less than A (or the equivalent
rating) by a nationally recognized investment rating agency, and (d) U.S. money
market funds that invest solely in obligations issued or guaranteed by the
United States of America or an agency thereof.

7.5. Loans. Make advances, loans or extensions of credit to any Person,
including any Parent, Subsidiary or Affiliate, except with respect to
(i) extensions of commercial trade credit in connection with the sale of
Inventory in the Ordinary Course of Business and (ii) temporary extensions of
credit in the form of advance payment for products to the Plant Affiliates in an
aggregate amount not to exceed $1,000,000 at any one time.

7.6. Capital Expenditures. Contract for, purchase or make any expenditure or
commitments for Capital Expenditures in any fiscal year in an aggregate amount
for all Borrowers in excess of $1,500,000.

7.7. Distributions. Pay or make any distribution on any Equity Interest of
Borrower or apply any of its funds, property or assets to the purchase,
redemption or other retirement of any Equity Interest, or of any options to
purchase or acquire any such Equity Interest of any Borrower except that:

(i) so long as (a) a notice of termination with regard to this Agreement shall
not be outstanding, and (b) no Event of Default or Default shall have occurred
and would not occur after giving pro forma effect to such payment(s), and
(c) the purpose for such purchase, redemption or distribution shall be as set
forth in writing to Agent at least ten (10) days prior to such purchase,
redemption or distribution and such purchase, redemption or distribution shall
in fact be used for such purpose, any Borrower shall be permitted to make
distributions to its members in an aggregate amount equal to the Increased Tax
Burden of its members;

(ii) at any time following December 31, 2014 so long as (a) a notice of
termination with regard to this Agreement shall not be outstanding, (b) no Event
of Default or Default shall have occurred and would not occur after giving pro
forma effect to such payment(s), (c) Borrowers have Average Undrawn Availability
of at least $10,000,000 after giving pro forma effect to such payments, and
(d) Borrowers are in compliance with the Fixed Charge Coverage Ratio set forth
in Section 6.5 calculated as of the date of such distribution after giving pro
forma effect to such payments, any Borrower shall be permitted to make
distributions in any fiscal year to Holdings in an aggregate amount not to
exceed fifty percent (50%) of Borrowers’ net income calculated as of the end of
the previous fiscal year.

Payments to members for taxes shall be made so as to be available when the tax
is due, including in respect of estimated tax payments. In the event (x) the
actual distribution to

 

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members made pursuant to subclause (i) of this Section 7.7 exceeds the actual
income tax liability of any member due to such Borrower’s status as a limited
liability company, or (y) if such Borrower was a subchapter C corporation, such
Borrower would be entitled to a refund of income taxes previously paid as a
result of a tax loss during a year in which such Borrower is a limited liability
company, then the members shall repay such Borrower the amount of such excess or
refund, as the case may be, no later than the date the annual tax return must be
filed by such Borrower (without giving effect to any filing extensions). In the
event such amounts are not repaid in a timely manner by any member, then such
Borrower shall not pay or make any distribution with respect to, or purchase,
redeem or retire, any membership interest of such Borrower held or controlled
by, directly or indirectly, such member until such payment has been made.

7.8. Indebtedness. Create, incur, assume or suffer to exist any Indebtedness
(exclusive of trade debt) except in respect of (i) Indebtedness to Lenders,
(ii) Indebtedness incurred for Capital Expenditures permitted under Section 7.6
hereof and (iii) unsecured Subordinated Debt, so long as (a) no Default or Event
of Default has occurred or would occur after giving effect to the incurrence of
such Indebtedness, (b) receipt by Agent of written notice five (5) days prior to
the incurrence of such Indebtedness, (c) such Indebtedness is made on terms and
conditions reasonably acceptable to Agent and (d) Agent has received an executed
Subordination Agreement.

7.9. Nature of Business. Substantially change the nature of the business in
which it is presently engaged, nor except as specifically permitted hereby
purchase or invest, directly or indirectly, in any assets or property other than
in the Ordinary Course of Business for assets or property which are useful in,
necessary for and are to be used in its business as presently conducted.

7.10. Transactions with Affiliates. Directly or indirectly, purchase, acquire or
lease any property from, or sell, transfer or lease any property to, or
otherwise enter into any transaction or deal with, any Affiliate, except
transactions (i) set forth on Schedule 7.10, (ii) so long as no Default or Event
of Default has occurred, relating to payments to Holdings for reimbursement of
(x) payroll and other payroll-related obligations and (y) other allocated
expenses incurred by Holdings for the benefit of any Borrower in an amount not
to exceed $250,000 in the aggregate per calendar month, and (iii) disclosed to
the Agent, which are in the Ordinary Course of Business, on an arm’s-length
basis on terms and conditions no less favorable than terms and conditions which
would have been obtainable from a Person other than an Affiliate.
Notwithstanding anything to the contrary set forth herein, no transaction with
an Affiliate otherwise permitted under this Section 7.10 shall require Borrowers
to make payments to such Affiliates in connection with such transaction on
payment terms of less than a monthly average of 3 days.

7.11. Leases. Enter as lessee into any lease arrangement for real or personal
property (unless capitalized and permitted under Section 7.6 hereof) if after
giving effect thereto, aggregate annual rental payments for all leased property
would exceed $2,000,000 in any one fiscal year in the aggregate for all
Borrowers.

7.12. Subsidiaries.

 

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(a) Form any Subsidiary unless (i) such Subsidiary expressly joins in this
Agreement as a borrower and becomes jointly and severally liable for the
obligations of Borrowers hereunder and under any other agreement between any
Borrower and Lenders and (ii) Agent shall have received all documents, including
legal opinions, it may reasonably require to establish compliance with each of
the foregoing conditions.

(b) Enter into any partnership, joint venture or similar arrangement.

7.13. Fiscal Year and Accounting Changes. Change its fiscal year from
December 31 without the prior written consent of Agent, which consent shall not
be unreasonably withheld or make any change (i) in accounting treatment and
reporting practices except as required by GAAP or (ii) in tax reporting
treatment except as required by law.

7.14. Pledge of Credit. Now or hereafter pledge Agent’s or any Lender’s credit
on any purchases or for any purpose whatsoever or use any portion of any Advance
in or for any business other than such Borrower’s business as conducted on the
date of this Agreement.

7.15. Amendment of Certificate of Formation, Operating Agreement. Amend, modify
or waive any term or material provision of its Certificate of Formation or
Limited Liability Company Agreement unless required by law.

7.16. Compliance with ERISA. (i) (x) Maintain, or permit any member of the
Controlled Group to maintain, or (y) become obligated to contribute, or permit
any member of the Controlled Group to become obligated to contribute, to any
Plan, other than those Plans disclosed on Schedule 5.8(d), (ii) engage, or
permit any member of the Controlled Group to engage, in any non-exempt
“prohibited transaction”, as that term is defined in Section 406 of ERISA or
Section 4975 of the Code, (iii) terminate, or permit any member of the
Controlled Group to terminate, any Plan where such event could result in any
liability of any Borrower or any member of the Controlled Group or the
imposition of a lien on the property of any Borrower or any member of the
Controlled Group pursuant to Section 4068 of ERISA, (iv) incur, or permit any
member of the Controlled Group to incur, any withdrawal liability to any
Multiemployer Plan; (v) fail promptly to notify Agent of the occurrence of any
Termination Event, (vi) fail to comply, or permit any member of the Controlled
Group to fail to comply, with the requirements of ERISA or the Code or other
Applicable Laws in respect of any Plan, (vii) fail to meet, permit any member of
the Controlled Group to fail to meet, or permit any Plan to fail to meet all
minimum funding requirements under ERISA and the Code, without regard to any
waivers or variances, or postpone or delay or allow any member of the Controlled
Group to postpone or delay any funding requirement with respect to any Plan, or
(viii) cause, or permit any member of the Controlled Group to cause, a
representation or warranty in Section 5.8(d) to cease to be true and correct.

7.17. Prepayment of Indebtedness. At any time, directly or indirectly, prepay
any Indebtedness (other than to Lenders), or repurchase, redeem, retire or
otherwise acquire any Indebtedness of any Borrower.

7.18. Reserved.

7.19. Membership/Partnership Interests. Elect to treat or permit any of its
Subsidiaries

 

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to (x) treat its limited liability company membership interests or partnership
interests, as the case may be, as securities as contemplated by the definition
of “security” in Section 8-102(15) and by Section 8-103 of Article 8 of Uniform
Commercial Code or (y) certificate its limited liability company membership
interests or partnership interests, as the case may be.

7.20. Reserved.

7.21. Affiliate Contracts. (i) Amend, modify or waive any material term or
provision of any Affiliate Contract or any Third Party Contract as in effect on
the Closing Date without the prior written consent of Required Lenders,
(ii) enter into any new Affiliate Contract or Third Party Contract following the
Closing Date, unless such contract is (a) substantially similar to the form of
contracts entered into by Borrowers with the Affiliate Plants prior to the
Closing Date and (b) promptly delivered to Agent or (iii) offer more favorable
marketing fee arrangements under any Affiliate Contract than those marketing fee
arrangements offered under any Third Party Contract.

7.22. Subordinated Debt. At any time, directly or indirectly, pay, prepay,
repurchase, redeem, retire or otherwise acquire or make any payment on account
of any principal of, interest on or premium payable in connection with the
repayment or redemption of the Subordinated Debt, except as expressly permitted
in the applicable Subordination Agreement.

7.23. Other Agreements. Enter into any material amendment, waiver or
modification of the Subordinated Loan Documentation or any related agreements.

7.24. Unhedged Inventory. Maintain Unhedged Inventory in excess of $5,000,000 at
any one time.

 

VIII. CONDITIONS PRECEDENT.

8.1. Conditions to Initial Advances. The agreement of Lenders to make the
initial Advances requested to be made on the Closing Date is subject to the
satisfaction, or waiver by Lenders, immediately prior to or concurrently with
the making of such Advances, of the following conditions precedent:

(a) Notes. Agent shall have received the Notes duly executed and delivered by an
authorized officer of each Borrower;

(b) Filings, Registrations and Recordings. Each document (including any Uniform
Commercial Code financing statement) required by this Agreement, any related
agreement or under law or reasonably requested by the Agent to be filed,
registered or recorded in order to create, in favor of Agent, a perfected
security interest in or lien upon the Collateral shall have been properly filed,
registered or recorded in each jurisdiction in which the filing, registration or
recordation thereof is so required or requested, and Agent shall have received
an acknowledgment copy, or other evidence satisfactory to it, of each such
filing, registration or recordation and satisfactory evidence of the payment of
any necessary fee, tax or expense relating thereto;

(c) Company Proceedings of Borrowers. Agent shall have received a copy of

 

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the resolutions in form and substance reasonably satisfactory to Agent, of the
Managing Member of each Borrower authorizing (i) the execution, delivery and
performance of this Agreement, the Notes and any related agreements
(collectively the “Documents”) and (ii) the granting by each Borrower of the
security interests in and liens upon the Collateral in each case certified by
the Secretary, or an Assistant Secretary, of each Borrower as of the Closing
Date; and, such certificate shall state that the resolutions thereby certified
have not been amended, modified, revoked or rescinded as of the date of such
certificate;

(d) Incumbency Certificates of Borrowers. Agent shall have received a
certificate of the Secretary or an Assistant Secretary of each Borrower, dated
the Closing Date, as to the incumbency and signature of the officers of each
Borrower executing this Agreement, the Other Documents, any certificate or other
documents to be delivered by it pursuant hereto, together with evidence of the
incumbency of such Secretary or Assistant Secretary;

(e) Corporate Proceedings of each Guarantor. Agent shall have received a copy of
the resolutions in form and substance reasonably satisfactory to Agent, of the
Board of Directors of each Guarantor authorizing the execution, delivery and
performance of each Guaranty and each Other Document to which it is a party
certified by the Secretary or an Assistant Secretary of such Guarantor as of the
Closing Date; and, such certificate shall state that the resolutions thereby
certified have not been amended, modified, revoked or rescinded as of the date
of such certificate;

(f) Incumbency Certificates of each Guarantor. Agent shall have received a
certificate of the Secretary or an Assistant Secretary of each Guarantor, dated
the Closing Date, as to the incumbency and signature of the officers of such
Guarantor executing the Guaranty and any certificate or other documents to be
delivered by it pursuant hereto, together with evidence of the incumbency of
such Secretary or Assistant Secretary;

(g) Certificates. Agent shall have received a copy of the Articles or
Certificate of Incorporation/Formation of each Borrower and each Guarantor, and
all amendments thereto, certified by the Secretary of State or other appropriate
official of its jurisdiction of incorporation/formation, as applicable, together
with copies of the By-Laws/Limited Liability Agreement of each Borrower and each
Guarantor and all agreements of each Borrower’s and each Guarantor’s
shareholders/members, as applicable, certified as accurate and complete by the
Secretary of each Borrower and each Guarantor;

(h) Good Standing Certificates. Agent shall have received good standing
certificates for each Borrower and each Guarantor dated not more than thirty
(30) days prior to the Closing Date, issued by the Secretary of State or other
appropriate official of each Borrower’s and each Guarantor’s jurisdiction of
incorporation/formation, as applicable, and each jurisdiction where the conduct
of each Borrower’s and each Guarantor’s business activities or the ownership of
its properties necessitates qualification;

(i) Legal Opinion. Agent shall have received the executed legal opinion of Husch
Blackwell Sanders LLP in form and substance satisfactory to Agent which shall
cover such matters incident to the transactions contemplated by this Agreement,
the Notes, the Other Documents, the Guaranty, the Guarantor Security Agreement,
the Pledge Agreement and related agreements as Agent may reasonably require and
each Borrower hereby authorizes and directs such counsel to deliver such
opinions to Agent and Lenders;

 

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(j) No Litigation. (i) No litigation, investigation or proceeding before or by
any arbitrator or Governmental Body shall be continuing or threatened against
Holdings, GPCM or any Borrower or against the officers or directors of Holdings,
GPCM or any Borrower (A) in connection with this Agreement, the Other Documents
or any of the transactions contemplated thereby and which, in the reasonable
opinion of Agent, is deemed material or (B) which could, in the reasonable
opinion of Agent, have a Material Adverse Effect; and (ii) no injunction, writ,
restraining order or other order of any nature materially adverse to Holdings,
GPCM or any Borrower or the conduct of its business or inconsistent with the due
consummation of the Transactions shall have been issued by any Governmental
Body;

(k) Financial Condition Certificates. Agent shall have received an executed
Financial Condition Certificate in the form of Exhibit 8.1(k).

(l) Collateral Examination. Agent shall have completed Collateral examinations,
the results of which shall be satisfactory in form and substance to Lenders, of
the Receivables, Inventory, General Intangibles, and Equipment of each Borrower
and all books and records in connection therewith;

(m) Fees. Agent shall have received all fees payable to Agent and Lenders on or
prior to the Closing Date hereunder, including pursuant to Article III hereof;

(n) Pro Forma Financial Statements. Agent shall have received a copy of the Pro
Forma Financial Statements which shall be satisfactory in all respects to
Lenders;

(o) Insurance. Agent shall have received in form and substance satisfactory to
Agent, certified copies of Borrowers’ casualty insurance policies, together with
lender loss payable endorsements on Agent’s standard form of lender loss payee
endorsement naming Agent as lender loss payee, and certified copies of
Borrowers’ liability insurance policies, together with endorsements naming Agent
as a co-insured;

(p) Payment Instructions. Agent shall have received written instructions from
Borrowing Agent directing the application of proceeds of the initial Advances
made pursuant to this Agreement;

(q) Blocked Accounts. Agent shall have received duly executed agreements
establishing the Blocked Accounts or Depository Accounts with financial
institutions acceptable to Agent for the collection or servicing of the
Receivables and proceeds of the Collateral;

(r) Consents. Agent shall have received any and all Consents necessary to permit
the effectuation of the transactions contemplated by this Agreement and the
Other Documents; and, Agent shall have received such Consents and waivers of
such third parties as might assert claims with respect to the Collateral, as
Agent and its counsel shall deem necessary;

(s) No Adverse Material Change. (i) since December 31, 2013, there shall not
have occurred any event, condition or state of facts which could reasonably be
expected to have a Material Adverse Effect and (ii) no representations made or
information supplied to Agent or Lenders shall have been proven to be inaccurate
or misleading in any material respect;

 

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(t) Leasehold Agreements. Agent shall have received landlord, mortgagee or
warehouseman agreements satisfactory to Agent with respect to all premises
leased by Borrowers at which Inventory and/or books and records are located;

(u) Guarantees and Other Documents. Agent shall have received (i) each executed
Guaranty, Guarantor Security Agreement and Pledge Agreement and (ii) the
executed Other Documents, all in form and substance satisfactory to Agent;

(v) Contract Review. Agent shall have reviewed all material contracts of
Borrowers including leases, union contracts, labor contracts, vendor supply
contracts, license agreements and distributorship agreements and such contracts
and agreements shall be satisfactory in all respects to Agent;

(w) Closing Certificate. Agent shall have received a closing certificate signed
by the Chief Financial Officer of each Borrower dated as of the date hereof,
stating that (i) all representations and warranties set forth in this Agreement
and the Other Documents are true and correct on and as of such date,
(ii) Borrowers are on such date in compliance with all the terms and provisions
set forth in this Agreement and the Other Documents and (iii) on such date no
Default or Event of Default has occurred or is continuing;

(x) Borrowing Base. Agent shall have received evidence from Borrowers that the
aggregate amount of Eligible Receivables, Eligible Insured Foreign Receivables,
Eligible Un-Insured Foreign Receivables, Eligible Off-load Receivables, Eligible
In-Tank Inventory, Eligible In-Transit Inventory, Eligible On-Track Inventory
and Eligible Stored Natural Gas Inventory less any and all reserves established
by Agent is sufficient in value and amount to support Advances in the amount
requested by Borrowers on the Closing Date;

(y) Undrawn Availability. After giving effect to the initial Advances hereunder,
Borrowers shall have Undrawn Availability of at least $10,000,000;

(z) Compliance with Laws. Agent shall be reasonably satisfied that each Borrower
is in compliance with all pertinent federal, state, local or territorial
regulations, including those with respect to the Federal Occupational Safety and
Health Act, the Environmental Protection Act, ERISA and the Anti-Terrorism Laws;

(aa) Lien Waiver/Inventory Acknowledgment. Agent shall have received executed
Lien Waiver/Inventory Acknowledgment from Blendstar; and

(bb) Other. All corporate and other proceedings, and all documents, instruments
and other legal matters in connection with the Transactions shall be
satisfactory in form and substance to Agent and its counsel.

8.2. Conditions to Each Advance. The agreement of Lenders to make any Advance
requested to be made on any date (including the initial Advance), is subject to
the satisfaction of the following conditions precedent as of the date such
Advance is made:

 

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(a) Representations and Warranties. Each of the representations and warranties
made by any Borrower in or pursuant to this Agreement, the Other Documents and
any related agreements to which it is a party, and each of the representations
and warranties contained in any certificate, document or financial or other
statement furnished at any time under or in connection with this Agreement, the
Other Documents or any related agreement shall be true and correct in all
material respects on and as of such date as if made on and as of such date;

(b) No Default. No Event of Default or Default shall have occurred and be
continuing on such date, or would exist after giving effect to the Advances
requested to be made, on such date; provided, however that Agent, in its sole
discretion, may, unless Required Lenders have instructed Agent otherwise in
writing, continue to make Advances notwithstanding the existence of an Event of
Default or Default and that any Advances so made shall not be deemed a waiver of
any such Event of Default or Default; and

(c) Maximum Advances. In the case of any type of Advance requested to be made,
after giving effect thereto, the aggregate amount of such type of Advance shall
not exceed the maximum amount of such type of Advance permitted under this
Agreement.

Each request for an Advance by any Borrower hereunder shall constitute a
representation and warranty by each Borrower as of the date of such Advance that
the conditions contained in this subsection shall have been satisfied.

 

IX. INFORMATION AS TO BORROWERS.

Each Borrower shall, or (except with respect to Section 9.11) shall cause
Borrowing Agent on its behalf to, until satisfaction in full of the Obligations
and the termination of this Agreement:

9.1. Disclosure of Material Matters. Immediately, and in any event within five
days, upon learning thereof, report to Agent all matters affecting the value,
enforceability or collectibility of any material portion of the Collateral,
including any Borrower’s reclamation or repossession of, or the return to any
Borrower of, a material amount of goods or claims or disputes asserted by any
Customer or other obligor.

9.2. Schedules. Deliver to Agent on or before:

(a) the fifteenth (15th) day of each month as and for the prior month,

(i) a detailed schedule of the accounts receivable ageings of Borrowers,
presented on both an invoice and due date basis, inclusive of reconciliations to
the general ledger; and

(ii) a detailed schedule of the accounts payable of Borrowers,

(b) the Tuesday of each calendar week as of Friday of the prior calendar week;

 

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(i) a summary of the accounts receivable ageings of Borrowers on both an invoice
and due date basis;

(ii) a summary of the accounts payable schedules of Borrowers;

(iii) a schedule of the ineligible Receivables of Borrowers; and

(iv) a Borrowing Base Certificate (with supporting schedules) in form and
substance satisfactory to Agent (which shall be calculated as of (1) Friday of
the prior calendar week and (2) on any day by which Borrowers request a
revolving advance subject to Agent’s discretion to forgo such requirement in its
sole discretion, both of which shall not be binding upon Agent or restrictive of
Agent’s rights under this Agreement).

In addition, each Borrower will deliver to Agent at such intervals as Agent may
require: (i) confirmatory assignment schedules, (ii) copies of Customer’s
invoices, (iii) evidence of shipment or delivery and (iv) such further
schedules, documents and/or information regarding the Collateral as Agent may
require including trial balances and test verifications. Agent shall have the
right to confirm and verify all Receivables by any manner and through any medium
it considers advisable and do whatever it may deem reasonably necessary to
protect its interests hereunder. The items to be provided under this Section are
to be in form satisfactory to Agent and executed by each Borrower and delivered
to Agent from time to time solely for Agent’s convenience in maintaining records
of the Collateral, and any Borrower’s failure to deliver any of such items to
Agent shall not affect, terminate, modify or otherwise limit Agent’s Lien with
respect to the Collateral.

9.3. Environmental Reports. Furnish Agent, concurrently with the delivery of the
financial statements referred to in Sections 9.7 and 9.8, with a certificate
signed by the President of Borrowing Agent stating, to the best of his
knowledge, that each Borrower is in compliance in all material respects with all
federal, state and local Environmental Laws. To the extent any Borrower is not
in compliance with the foregoing laws, the certificate shall set forth with
specificity all areas of non-compliance and the proposed action such Borrower
will implement in order to achieve full compliance.

9.4. Litigation. Promptly notify Agent in writing of any claim, litigation, suit
or administrative proceeding affecting any Borrower or any Guarantor, whether or
not the claim is covered by insurance, and of any litigation, suit or
administrative proceeding, which in any such case affects the Collateral or
which could reasonably be expected to have a Material Adverse Effect.

9.5. Material Occurrences. Promptly notify Agent in writing upon the occurrence
of (a) any Event of Default or Default; (b) any event, development or
circumstance whereby any financial statements or other reports furnished to
Agent fail in any material respect to present fairly, in accordance with GAAP
consistently applied (other than the omission of footnotes and the effects of
normal year-end adjustments for any financial statements delivered to Agent
(other than the annual financial statements)), the financial condition or
operating results of any Borrower as of the date of such statements; (c) any
accumulated retirement plan funding deficiency which, if such deficiency
continued for two plan years and was not corrected as

 

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provided in Section 4971 of the Code, could subject any Borrower to a tax
imposed by Section 4971 of the Code; (d) each and every default by any Borrower
which might result in the acceleration of the maturity of any Indebtedness,
including the names and addresses of the holders of such Indebtedness with
respect to which there is a default existing or with respect to which the
maturity has been or could be accelerated, and the amount of such Indebtedness;
(e) any other development in the business or affairs of any Borrower which could
reasonably be expected to have a Material Adverse Effect and (f) any event of
default under the Subordinated Loan Documentation; in each case describing the
nature thereof and the action Borrowers propose to take with respect thereto.

9.6. Government Receivables. Notify Agent immediately if any of its Receivables
arise out of contracts between any Borrower and the United States, any state, or
any department, agency or instrumentality of any of them.

9.7. Annual Financial Statements. Furnish Agent and Lenders within one hundred
twenty (120) days after the end of each fiscal year of Borrowers, financial
statements of Holdings and Borrowers on a consolidating and consolidated basis
including, but not limited to, statements of income and stockholders’ equity and
cash flow from the beginning of the current fiscal year to the end of such
fiscal year and the balance sheet as at the end of such fiscal year, all
prepared in accordance with GAAP applied on a basis consistent with prior
practices, and in reasonable detail and reported upon without qualification by
an independent certified public accounting firm selected by Borrowers (the
“Accountants”). The reports shall be accompanied by a Compliance Certificate.

9.8. Quarterly Financial Statements. Furnish Agent and Lenders within forty-five
(45) days after the end of each fiscal quarter, an unaudited balance sheet of
(i) Borrowers on a consolidated and consolidating basis and unaudited statements
of income and stockholders’ equity and cash flow of Borrowers on a consolidated
and consolidating basis reflecting results of operations from the beginning of
the fiscal year to the end of such quarter and for such quarter and
(ii) Borrowers and Holdings on a consolidated basis and unaudited statements of
income and stockholders’ equity and cash flow of Borrowers and Holdings on a
consolidated basis reflecting results of operations from the beginning of the
fiscal year to the end of such quarter and for such quarter, in each case
prepared on a basis consistent with prior practices and complete and correct in
all material respects, subject to normal and recurring year end adjustments that
individually and in the aggregate are not material to Borrowers’ or Holding’s
business, as applicable. The reports shall be accompanied by a Compliance
Certificate.

9.9. Monthly Financial Statements. Furnish Agent and Lenders within thirty
(30) days after the end of each month (other than for the months of March, June,
September and December which shall be delivered in accordance with Sections 9.7
and 9.8 as applicable), an unaudited balance sheet of Borrowers on a
consolidated and consolidating basis and unaudited statements of income and
stockholders’ equity and cash flow of Borrowers on a consolidated and
consolidating basis reflecting results of operations from the beginning of the
fiscal year to the end of such month and for such month, prepared on a basis
consistent with prior practices and complete and correct in all material
respects, subject to normal and recurring year end adjustments that individually
and in the aggregate are not material to Borrowers’ business. The reports shall
be accompanied by a Compliance Certificate.

 

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9.10. Other Reports. Furnish Agent as soon as available, but in any event within
ten (10) days after the issuance thereof, with copies of such material financial
statements, reports and returns as each Borrower shall send to its members.

9.11. Additional Information. Furnish Agent with such additional information as
Agent shall reasonably request in order to enable Agent to determine whether the
terms, covenants, provisions and conditions of this Agreement and the Notes have
been complied with by Borrowers including, without the necessity of any request
by Agent, (a) copies of all material environmental audits and reviews, (b) at
least thirty (30) days prior thereto, notice of any Borrower’s opening of any
new office or place of business or any Borrower’s closing of any existing office
or place of business, and (c) promptly upon any Borrower’s learning thereof,
notice of any labor dispute to which any Borrower may become a party, any
strikes or walkouts relating to any of its plants or other facilities, and the
expiration of any labor contract to which any Borrower is a party or by which
any Borrower is bound.

9.12. Projected Operating Budget. Furnish Agent and Lenders, no later than ten
(10) days prior to the beginning of each Borrower’s fiscal years commencing with
fiscal year 2015, a month by month projected operating budget and cash flow of
Borrowers on a consolidated and consolidating basis for such fiscal year
(including an income statement for each month and a balance sheet as at the end
of the last month in each fiscal quarter), such projections to be accompanied by
a certificate signed by the Chief Financial Officer, Chief Executive Officer, or
Executive Vice President and Treasurer of each Borrower to the effect that such
projections have been prepared on the basis of sound financial planning practice
consistent with past budgets and financial statements and that such officer has
no reason to question the reasonableness of any material assumptions on which
such projections were prepared.

9.13. Variances From Operating Budget. Furnish Agent, concurrently with the
delivery of the financial statements referred to in Section 9.7 and each monthly
report, a written report summarizing all material variances from budgets
submitted by Borrowers pursuant to Section 9.12 and a discussion and analysis by
management with respect to such variances.

9.14. Notice of Suits, Adverse Events. Furnish Agent with prompt written notice
of (i) any lapse or other termination of any Consent issued to any Borrower by
any Governmental Body or any other Person that is material to the operation of
any Borrower’s business, (ii) any refusal by any Governmental Body or any other
Person to renew or extend any such Consent; and (iii) copies of any periodic or
special reports filed by any Borrower or any Guarantor with any Governmental
Body or Person, if such reports indicate any material change in the business,
operations, affairs or condition of any Borrower or any Guarantor, or if copies
thereof are requested by Lender, and (iv) copies of any material notices and
other communications from any Governmental Body or Person which specifically
relate to any Borrower or any Guarantor.

9.15. ERISA Notices and Requests. Furnish Agent with immediate written notice in
the event that (i) any Borrower or any member of the Controlled Group knows or
has reason to know that a Termination Event has occurred, together with a
written statement describing such Termination Event and the action, if any,
which such Borrower or any member of the Controlled Group has taken, is taking,
or proposes to take with respect thereto and, when known, any action taken or
threatened by the Internal Revenue Service, Department of Labor or PBGC with
respect

 

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thereto, (ii) any Borrower or any member of the Controlled Group knows or has
reason to know that a prohibited transaction (as defined in Section 406 of ERISA
or 4975 of the Code) has occurred together with a written statement describing
such transaction and the action which such Borrower or any member of the
Controlled Group has taken, is taking or proposes to take with respect thereto,
(iii) a funding waiver request has been filed with respect to any Plan together
with all communications received by any Borrower or any member of the Controlled
Group with respect to such request, (iv) any increase in the benefits of any
existing Plan or the establishment of any new Plan or the commencement of
contributions to any Plan to which any Borrower or any member of the Controlled
Group was not previously contributing shall occur, (v) any Borrower or any
member of the Controlled Group shall receive from the PBGC a notice of intention
to terminate a Plan or to have a trustee appointed to administer a Plan,
together with copies of each such notice, (vi) any Borrower or any member of the
Controlled Group shall receive any favorable or unfavorable determination letter
from the Internal Revenue Service regarding the qualification of a Plan under
Section 401(a) of the Code, together with copies of each such letter; (vii) any
Borrower or any member of the Controlled Group shall receive a notice regarding
the imposition of withdrawal liability, together with copies of each such
notice; (viii) any Borrower or any member of the Controlled Group shall fail to
make a required installment or any other required payment under the Code or
ERISA on or before the due date for such installment or payment; or (ix) any
Borrower or any member of the Controlled Group knows that (a) a Multiemployer
Plan has been terminated, (b) the administrator or plan sponsor of a
Multiemployer Plan intends to terminate a Multiemployer Plan, (c) the PBGC has
instituted or will institute proceedings under Section 4042 of ERISA to
terminate a Multiemployer Plan or (d) a Multiemployer Plan is subject to
Section 432 of the Code or Section 305 of ERISA.

9.16. Additional Documents. Execute and deliver to Agent, upon request, such
documents and agreements as Agent may, from time to time, reasonably request to
carry out the purposes, terms or conditions of this Agreement.

 

X. EVENTS OF DEFAULT.

The occurrence of any one or more of the following events shall constitute an
“Event of Default”:

10.1. Nonpayment. Failure by any Borrower to pay any principal or interest on
the Obligations when due, whether at maturity or by reason of acceleration
pursuant to the terms of this Agreement or by notice of intention to prepay, or
by required prepayment or failure to pay any other liabilities or make any other
payment, fee or charge provided for herein when due or in any Other Document;

10.2. Breach of Representation. Except as provided in Section 10.22, any
representation or warranty made or deemed made by any Borrower or any Guarantor
in this Agreement, any Other Document or any related agreement or in any
certificate, document or financial or other statement furnished at any time in
connection herewith or therewith shall prove to have been misleading in any
material respect on the date when made or deemed to have been made;

10.3. Financial Information. Failure by any Borrower to (i) furnish financial
information when due or when requested, or (ii) permit the inspection of its
books or records, which failure is not cured within five (5) days from the
occurrence of such failure;

 

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10.4. Judicial Actions. Issuance of a notice of Lien, levy, assessment,
injunction or attachment against any Borrower’s Inventory or Receivables or
against a material portion of any Borrower’s other property;

10.5. Noncompliance. Except as otherwise provided for in Sections 10.1, 10.3,
10.5(ii), and 10.22, (i) failure or neglect of any Borrower or any Guarantor or
any Person to perform, keep or observe any term, provision, condition, covenant
herein contained, or contained in any Other Document or any other agreement or
arrangement, now or hereafter entered into between any Borrower or any Guarantor
or such Person, and Agent or any Lender, or (ii) failure or neglect of any
Borrower to perform, keep or observe any term, provision, condition or covenant,
contained in Sections 4.6, 4.7, 4.9, 6.3, 6.4, 9.4 or 9.6 hereof which is not
cured within ten (10) days from the occurrence of such failure or neglect;

10.6. Judgments. Any judgment or judgments are rendered against any Borrower for
an aggregate amount in excess of $250,000 or against all Borrowers for an
aggregate amount in excess of $250,000 and (i) enforcement proceedings shall
have been commenced by a creditor upon such judgment, (ii) there shall be any
period of forty (40) consecutive days during which a stay of enforcement of such
judgment, by reason of a pending appeal or otherwise, shall not be in effect, or
(iii) any such judgment results in the creation of a Lien upon any of the
Collateral (other than a Permitted Encumbrance);

10.7. Bankruptcy. Any Borrower or any Guarantor shall (i) apply for, consent to
or suffer the appointment of, or the taking of possession by, a receiver,
custodian, trustee, liquidator or similar fiduciary of itself or of all or a
substantial part of its property, (ii) make a general assignment for the benefit
of creditors, (iii) commence a voluntary case under any state or federal
bankruptcy laws (as now or hereafter in effect), (iv) be adjudicated a bankrupt
or insolvent, (v) file a petition seeking to take advantage of any other law
providing for the relief of debtors, (vi) acquiesce to, or fail to have
dismissed, within thirty (30) days, any petition filed against it in any
involuntary case under such bankruptcy laws, or (vii) take any action for the
purpose of effecting any of the foregoing;

10.8. Inability to Pay. Any Borrower or any Guarantor shall admit in writing its
inability, or be generally unable, to pay its debts as they become due or cease
operations of its present business;

10.9. Subsidiary Bankruptcy. Any Subsidiary of any Borrower, or any Guarantor,
shall (i) apply for, consent to or suffer the appointment of, or the taking of
possession by, a receiver, custodian, trustee, liquidator or similar fiduciary
of itself or of all or a substantial part of its property, (ii) admit in writing
its inability, or be generally unable, to pay its debts as they become due or
cease operations of its present business, (iii) make a general assignment for
the benefit of creditors, (iv) commence a voluntary case under any state or
federal bankruptcy laws (as now or hereafter in effect), (v) be adjudicated a
bankrupt or insolvent, (vi) file a petition seeking to take advantage of any
other law providing for the relief of debtors, (vii) acquiesce to, or fail to
have dismissed, within thirty (30) days, any petition filed against it in any
involuntary case under such bankruptcy laws, or (viii) take any action for the
purpose of effecting any of the foregoing;

 

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10.10. Material Adverse Effect. The occurrence of any Material Adverse Effect;

10.11. Lien Priority. Any Lien created hereunder or provided for hereby or under
any related agreement for any reason ceases to be or is not a valid and
perfected Lien having a first priority interest;

10.12. Guarantor Cross Default. A default of the obligations of Guarantor under
any other agreement for debt of borrowed money to which it is a party, which
default is not cured within any applicable grace period which would permit the
debt-holder to accelerate the obligations thereunder.

10.13. Cross Default. A default of any material obligations of any Borrower
under any other agreement to which it is a party which default is not cured
within any applicable grace period;

10.14. Breach of Guaranty, Guarantor Security Agreement or Pledge Agreement.
Termination or breach of any Guaranty, Guarantor Security Agreement, Pledge
Agreement or similar agreement executed and delivered to Agent in connection
with the Obligations of any Borrower, or if any Guarantor or pledgor attempts to
terminate, challenges the validity of, or its liability under, any such
Guaranty, Guarantor Security Agreement, Pledge Agreement or similar agreement;

10.15. Change of Ownership. Any Change of Ownership or Change of Control shall
occur;

10.16. Invalidity. Any material provision of this Agreement or any Other
Document shall, for any reason, cease to be valid and binding on any Borrower or
any Guarantor, or any Borrower or any Guarantor shall so claim in writing to
Agent or any Lender;

10.17. Licenses. (i) Any Governmental Body shall (A) revoke, terminate, suspend
or adversely modify any license, permit, patent trademark or tradename of any
Borrower or (B) commence proceedings to suspend, revoke, terminate or adversely
modify any such license, permit, trademark, tradename or patent and such
proceedings shall not be dismissed or discharged within sixty (60) days, or
(C) schedule or conduct a hearing on the renewal of any license, permit,
trademark, tradename or patent necessary for the continuation of any Borrower’s
business and the staff of such Governmental Body issues a report recommending
the termination, revocation, suspension or material, adverse modification of
such license, permit, trademark, tradename or patent, the effect of any of which
may have a Material Adverse Effect; (ii) any agreement which is necessary and
material to the operation of any Borrower’s business shall be revoked or
terminated and not replaced by a substitute acceptable to Agent within thirty
(30) days after the date of such revocation or termination, and such revocation
or termination and non-replacement would reasonably be expected to have a
Material Adverse Effect;

10.18. Seizures. Any portion of the Collateral shall be seized or taken by a
Governmental Body, or any Borrower or the title and rights of any Borrower or
any Original Owner which is the owner of any material portion of the Collateral
shall have become the subject

 

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matter of claim, litigation, suit or other proceeding which might, in the
opinion of Agent, upon final determination, result in impairment or loss of the
security provided by this Agreement or the Other Documents;

10.19. Operations. The operations of any Borrower are interrupted at any time
for more than three (3) consecutive days, unless such Borrower shall (i) be
entitled to receive for such period of interruption, proceeds of business
interruption insurance sufficient to assure that its per diem cash needs during
such period is at least equal to its average per diem cash needs for the
consecutive three month period immediately preceding the initial date of
interruption and (ii) receive such proceeds in the amount described in clause
(i) preceding not later than thirty (30) days following the initial date of any
such interruption; provided, however, that notwithstanding the provisions of
clauses (i) and (ii) of this section, an Event of Default shall be deemed to
have occurred if such Borrower shall be receiving the proceeds of business
interruption insurance for a period of thirty (30) consecutive days;

10.20. Pension Plans. An event or condition specified in Section 7.16 or 9.15
hereof shall occur or exist with respect to any Plan and, as a result of such
event or condition, together with all other such events or conditions, any
Borrower or any member of the Controlled Group shall incur, or in the opinion of
Agent be reasonably likely to incur, a liability to a Plan or the PBGC (or both)
which, in the reasonable judgment of Agent, would have a Material Adverse
Effect; or the occurrence of any Termination Event, or any Borrower’s failure to
immediately report a Termination Event in accordance with Section 9.15 hereof.

10.21. Subordinated Loan Default. An event of default has occurred under the
Subordinated Loan Documentation or the Subordination Agreement or any party to
the Subordination Agreement (other than Agent) attempts to terminate, challenges
the validity of, or its obligations under, such Subordination Agreement, or any
Subordination Agreement shall cease to be in full force and effect; or

10.22. Anti-Terrorism Laws. If (i) any representation or warranty contained in
(x) Section 16.18 hereof or (y) any corresponding section of any Guaranty is or
becomes false or misleading at any time, (ii) any Borrower shall fail to comply
with its obligations under Section 16.18 hereof, or (iii) any Guarantor shall
fail to comply with its obligations under any section of any Guaranty containing
provisions comparable to those set forth in Section 16.18 hereof.

10.23. Equity Cure Right. Notwithstanding the provisions of Section 10.5 or
Article XI to the contrary, Holdings may, but shall not be obligated to, cure
any potential Event of Default under Section 6.5 (a “Financial Covenant
Default”) by making a capital contribution into Borrowers in the form of new
cash equity contributions in an aggregate principal amount equal to or greater
than the amount (the “EBITDA Shortfall Amount”) that, when added to EBITDA on a
dollar-for-dollar basis for the relevant testing period, would have caused
Borrowers to be in full compliance with Section 6.5 for such testing period
(each, an “Equity Cure”); provided that (a) such Equity Cure shall be in an
aggregate minimum amount of $1,000,000 and in integral multiples of $500,000
thereafter, (b) such Equity Cure must be effected no later than 10 days after
the delivery of the Compliance Certificate (or the date on which such Compliance
Certificate was required to have been delivered to Agent) detailing the
respective Financial Covenant Calculations prior to exercise of the Equity Cure
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following exercise of the Equity Cure Right, (c) no more than two (2) Equity
Cures may be made during any four (4) consecutive quarters during the Term,
(d) each such Equity Cure shall be delivered by wire transfer of immediately
available funds to one of Borrower’s Depositary Accounts, as specified by Agent,
for application to the outstanding principal amount of the Revolving Advances;
and (e) notwithstanding anything to the contrary contained in the foregoing, no
such rights to effectuate an Equity Cure may be exercised in any case where the
potential Event of Default under Section 6.5, after taking into account any
prior Equity Cure exercised in the preceding three (3) quarters (not to exceed
$5,000,000), arises from Borrowers having a Fixed Charge Coverage Ratio,
measured on a rolling four quarter basis, of less than .75 to 1.0. Upon the
receipt by Borrowers of each such Equity Cure, each such Financial Covenant
Default shall be recalculated giving effect to the following pro forma
adjustments:

(a) EBITDA shall be increased, solely for the purpose of determining the
existence of an Event of Default under Section 6.5, with respect to the relevant
testing period and all future testing periods that includes the last month of
the testing period in respect of which such Equity Cure was made; and

(b) if, after giving effect to the foregoing recalculations, Borrowers shall
then be in compliance with the requirements of Section 6.5, Borrowers shall be
deemed to have satisfied the requirements of Section 6.5, with the same effect
as though there had been no failure to comply therewith.

 

XI. LENDERS’ RIGHTS AND REMEDIES AFTER DEFAULT.

11.1. Rights and Remedies.

(a) Upon the occurrence of (i) an Event of Default pursuant to Section 10.7 all
Obligations shall be immediately due and payable and this Agreement and the
obligation of Lenders to make Advances shall be deemed terminated; and, (ii) any
of the other Events of Default and at any time thereafter, at the option of
Required Lenders all Obligations shall be immediately due and payable and
Required Lenders shall have the right to terminate this Agreement and to
terminate the obligation of Lenders to make Advances and (iii) a filing of a
petition against any Borrower in any involuntary case under any state or federal
bankruptcy laws, all Obligations shall be immediately due and payable and the
obligation of Lenders to make Advances hereunder shall be terminated other than
as may be required by an appropriate order of the bankruptcy court having
jurisdiction over such Borrower. Upon the occurrence of any Event of Default,
Agent shall have the right to, and at the direction of Required Lenders shall,
exercise any and all rights and remedies provided for herein, under the Other
Documents, under the Uniform Commercial Code and at law or equity generally,
including the right to foreclose the security interests granted herein and to
realize upon any Collateral by any available judicial procedure and/or to take
possession of and sell any or all of the Collateral with or without judicial
process. Agent may enter any of any Borrower’s premises or other premises
without legal process and without incurring liability to any Borrower therefor,
and Agent may thereupon, or at any time thereafter, in its discretion without
notice or demand, take the Collateral and remove the same to such place as Agent
may deem advisable and Agent may require Borrowers to make the Collateral
available to Agent at a convenient place. With or without having the Collateral
at the time or place of sale, Agent may sell the Collateral, or any part
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or private sale, at any time or place, in one or more sales, at such price or
prices, and upon such terms, either for cash, credit or future delivery, as
Agent may elect. Except as to that part of the Collateral which is perishable or
threatens to decline speedily in value or is of a type customarily sold on a
recognized market, Agent shall give Borrowers reasonable notification of such
sale or sales, it being agreed that in all events written notice mailed to
Borrowing Agent at least ten (10) days prior to such sale or sales is reasonable
notification. At any public sale Agent or any Lender may bid for and become the
purchaser, and Agent, any Lender or any other purchaser at any such sale
thereafter shall hold the Collateral sold absolutely free from any claim or
right of whatsoever kind, including any equity of redemption and all such
claims, rights and equities are hereby expressly waived and released by each
Borrower. In connection with the exercise of the foregoing remedies, including
the sale of Inventory, Agent is granted a perpetual nonrevocable, royalty free,
nonexclusive license and Agent is granted permission to use all of each
Borrower’s (a) trademarks, trade styles, trade names, patents, patent
applications, copyrights, service marks, licenses, franchises and other
proprietary rights which are used or useful in connection with Inventory for the
purpose of marketing, advertising for sale and selling or otherwise disposing of
such Inventory and (b) Equipment for the purpose of completing the manufacture
of unfinished goods. The cash proceeds realized from the sale of any Collateral
shall be applied to the Obligations in the order set forth in Section 11.5
hereof. Noncash proceeds will only be applied to the Obligations as they are
converted into cash. If any deficiency shall arise, Borrowers shall remain
liable to Agent and Lenders therefor.

(b) To the extent that Applicable Law imposes duties on the Agent to exercise
remedies in a commercially reasonable manner, each Borrower acknowledges and
agrees that it is not commercially unreasonable for the Agent (i) to fail to
incur expenses reasonably deemed significant by the Agent to prepare Collateral
for disposition or otherwise to complete raw material or work in process into
finished goods or other finished products for disposition, (ii) to fail to
obtain third party consents for access to Collateral to be disposed of, or to
obtain or, if not required by other law, to fail to obtain governmental or third
party consents for the collection or disposition of Collateral to be collected
or disposed of, (iii) to fail to exercise collection remedies against Customers
or other Persons obligated on Collateral or to remove Liens on or any adverse
claims against Collateral, (iv) to exercise collection remedies against
Customers and other Persons obligated on Collateral directly or through the use
of collection agencies and other collection specialists, (v) to advertise
dispositions of Collateral through publications or media of general circulation,
whether or not the Collateral is of a specialized nature, (vi) to contact other
Persons, whether or not in the same business as any Borrower, for expressions of
interest in acquiring all or any portion of such Collateral, (vii) to hire one
or more professional auctioneers to assist in the disposition of Collateral,
whether or not the Collateral is of a specialized nature, (viii) to dispose of
Collateral by utilizing internet sites that provide for the auction of assets of
the types included in the Collateral or that have the reasonable capacity of
doing so, or that match buyers and sellers of assets, (ix) to dispose of assets
in wholesale rather than retail markets, (x) to disclaim disposition warranties,
such as title, possession or quiet enjoyment, (xi) to purchase insurance or
credit enhancements to insure the Agent against risks of loss, collection or
disposition of Collateral or to provide to the Agent a guaranteed return from
the collection or disposition of Collateral, or (xii) to the extent deemed
appropriate by the Agent, to obtain the services of other brokers, investment
bankers, consultants and other professionals to assist the Agent in the
collection or disposition of any of the Collateral. Each Borrower acknowledges
that the purpose of this Section 11.1(b) is to provide non-exhaustive
indications of what actions or

 

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omissions by the Agent would not be commercially unreasonable in the Agent’s
exercise of remedies against the Collateral and that other actions or omissions
by the Agent shall not be deemed commercially unreasonable solely on account of
not being indicated in this Section 11.1(b). Without limitation upon the
foregoing, nothing contained in this Section 11.1(b) shall be construed to grant
any rights to any Borrower or to impose any duties on Agent that would not have
been granted or imposed by this Agreement or by Applicable Law in the absence of
this Section 11.1(b).

11.2. Agent’s Discretion. Agent shall have the right in its sole discretion to
determine which rights, Liens, security interests or remedies Agent may at any
time pursue, relinquish, subordinate, or modify or to take any other action with
respect thereto and such determination will not in any way modify or affect any
of Agent’s or Lenders’ rights hereunder.

11.3. Setoff. Subject to Section 14.12, in addition to any other rights which
Agent or any Lender may have under Applicable Law, upon the occurrence of an
Event of Default hereunder, Agent and such Lender shall have a right,
immediately and without notice of any kind, to apply any Borrower’s property
held by Agent and such Lender to reduce the Obligations.

11.4. Rights and Remedies not Exclusive. The enumeration of the foregoing rights
and remedies is not intended to be exhaustive and the exercise of any rights or
remedy shall not preclude the exercise of any other right or remedies provided
for herein or otherwise provided by law, all of which shall be cumulative and
not alternative.

11.5. Allocation of Payments After Event of Default. Notwithstanding any other
provisions of this Agreement to the contrary, after the occurrence and during
the continuance of an Event of Default, all amounts collected or received by the
Agent on account of the Obligations or any other amounts outstanding under any
of the Other Documents or in respect of the Collateral may, at Agent’s
discretion and shall, after acceleration of the Obligations hereunder, be paid
over or delivered as follows:

FIRST, to the payment of all reasonable out-of-pocket costs and expenses
(including reasonable attorneys’ fees) of the Agent in connection with enforcing
its rights and the rights of the Lenders under this Agreement and the Other
Documents and any protective advances made by the Agent with respect to the
Collateral under or pursuant to the terms of this Document;

SECOND, to payment of any fees owed to the Agent;

THIRD, to the payment of all reasonable out-of-pocket costs and expenses
(including reasonable attorneys’ fees) of each of the Lenders to the extent
owing to such Lender pursuant to the terms of this Agreement;

FOURTH, to the payment of all of the Obligations consisting of accrued interest
on account of the Swing Loans;

FIFTH:, to the payment of the outstanding principal amount of the Obligations
consisting of Swing Loans;

 

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SIXTH, to the payment of all of the remaining Obligations consisting of accrued
fees and interest;

SEVENTH, to the payment of the Obligations consisting of principal, and to the
payment of Hedge Liabilities and Cash Management Liabilities (in each case, only
to the extent of reserves established for the Hedge Liabilities or Cash
Management Liabilities against the Formula Amount, which reserves, when
implemented, shall not have the effect of causing an Out-of-Formula Loan), and
payment or cash collateralization of any outstanding Letters of Credit in
accordance with Section 3.2(b) hereof, and not repaid pursuant to clauses
“FIRST” through “SIXTH” above.

EIGHTH, to payment or cash collateralization of Cash Management Liabilities and
Hedge Liabilities, to the extent not provided for above.

NINTH, to all other Obligations and other obligations which shall have become
due and payable under the Other Documents or otherwise and not repaid pursuant
to clauses “FIRST” through “EIGHTH” above;

TENTH, to all Obligations owing to any Defaulting Lender; and

ELEVENTH, to the payment of the surplus, if any, to whoever may be lawfully
entitled to receive such surplus.

In carrying out the foregoing, (i) amounts received shall be applied in the
numerical order provided until exhausted prior to application to the next
succeeding category; (ii) each of the Lenders shall receive (so long as it is
not a Defaulting Lender) an amount equal to its pro rata share (based on the
proportion that the then outstanding Advances held by such Lender bears to the
aggregate then outstanding Advances) of amounts available to be applied pursuant
to clauses “SIXTH”, “SEVENTH”, “EIGHTH” and “NINTH” above; and (iii) to the
extent that any amounts available for distribution pursuant to clause “SEVENTH”
above are attributable to the issued but undrawn amount of outstanding Letters
of Credit, such amounts shall be held by the Agent in a cash collateral account
and applied (A) first, to reimburse the Issuer from time to time for any
drawings under such Letters of Credit and (B) then, following the expiration of
all Letters of Credit, to all other obligations of the types described in
clauses “SEVENTH” and “EIGHTH” above in the manner provided in this
Section 11.5.

 

XII. WAIVERS AND JUDICIAL PROCEEDINGS.

12.1. Waiver of Notice. Each Borrower hereby waives notice of non-payment of any
of the Obligations, demand, presentment, protest and notice thereof with respect
to any and all instruments, notice of acceptance hereof, notice of loans or
advances made, credit extended, Collateral received or delivered, or any other
action taken in reliance hereon, and all other demands and notices of any
description, except such as are expressly provided for herein.

12.2. Delay. No delay or omission on Agent’s or any Lender’s part in exercising
any right, remedy or option shall operate as a waiver of such or any other
right, remedy or option or of any Default or Event of Default.

 

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12.3. Jury Waiver. EACH PARTY TO THIS AGREEMENT HEREBY EXPRESSLY WAIVES ANY
RIGHT TO TRIAL BY JURY OF ANY CLAIM, COUNTERCLAIM, DEMAND, ACTION OR CAUSE OF
ACTION (A) ARISING UNDER THIS AGREEMENT, ANY OTHER DOCUMENT OR ANY OTHER
INSTRUMENT, DOCUMENT OR AGREEMENT EXECUTED OR DELIVERED IN CONNECTION HEREWITH,
OR (B) IN ANY WAY CONNECTED WITH OR RELATED OR INCIDENTAL TO THE DEALINGS OF THE
PARTIES HERETO OR ANY OF THEM WITH RESPECT TO THIS AGREEMENT, ANY OTHER DOCUMENT
OR ANY OTHER INSTRUMENT, DOCUMENT OR AGREEMENT EXECUTED OR DELIVERED IN
CONNECTION HEREWITH, OR THE TRANSACTIONS RELATED HERETO OR THERETO IN EACH CASE
WHETHER NOW EXISTING OR HEREAFTER ARISING, AND WHETHER SOUNDING IN CONTRACT OR
TORT OR OTHERWISE AND EACH PARTY HEREBY CONSENTS THAT ANY SUCH CLAIM,
COUNTERCLAIM, DEMAND, ACTION OR CAUSE OF ACTION SHALL BE DECIDED BY COURT TRIAL
WITHOUT A JURY, AND THAT ANY PARTY TO THIS AGREEMENT MAY FILE AN ORIGINAL
COUNTERPART OR A COPY OF THIS SECTION WITH ANY COURT AS WRITTEN EVIDENCE OF THE
CONSENTS OF THE PARTIES HERETO TO THE WAIVER OF THEIR RIGHT TO TRIAL BY JURY.

 

XIII. EFFECTIVE DATE AND TERMINATION.

13.1. Term. This Agreement, which shall inure to the benefit of and shall be
binding upon the respective successors and permitted assigns of each Borrower,
Agent and each Lender, shall become effective on the date hereof and shall
continue in full force and effect until November 26, 2019 (the “Term”) unless
sooner terminated as herein provided. Borrowers may terminate this Agreement at
any time upon ninety (90) days’ prior written notice upon payment in full of the
Obligations.

13.2. Termination. The termination of the Agreement shall not affect Agent’s or
any Lender’s rights, or any of the Obligations having their inception prior to
the effective date of such termination or any Obligations which pursuant to the
terms hereof continue to accrue after such date, and the provisions hereof shall
continue to be fully operative until (a) all transactions entered into, rights
or interests created and Obligations have been fully and indefeasibly paid,
disposed of, concluded or liquidated, and (b) all Borrowers and all Guarantors
have released Secured Parties from and against any and all claims of any nature
whatsoever that any Borrower or any Guarantor may have against Secured Parties.
The security interests, Liens and rights granted to Agent and Lenders hereunder
and the financing statements filed hereunder shall continue in full force and
effect, notwithstanding the termination of this Agreement or the fact that
Borrowers’ Account may from time to time be temporarily in a zero or credit
position, until all of the Obligations of each Borrower have been indefeasibly
paid and performed in full after the termination of this Agreement or each
Borrower has furnished Agent and Lenders with an indemnification satisfactory to
Agent and Lenders with respect thereto. Accordingly, each Borrower waives any
rights which it may have under the Uniform Commercial Code to demand the filing
of termination statements with respect to the Collateral, and Agent shall not be
required to send such termination statements to each Borrower, or to file them
with any filing office, unless and until this Agreement shall have been
terminated in accordance with its terms and all Obligations have been
indefeasibly paid in full in immediately available funds. All representations,
warranties, covenants, waivers and agreements contained herein shall survive
termination hereof until all Obligations are indefeasibly paid and performed in
full.

 

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XIV. REGARDING AGENT.

14.1. Appointment. Each Lender hereby designates PNC to act as Agent for such
Lender under this Agreement and the Other Documents. Each Lender hereby
irrevocably authorizes Agent to take such action on its behalf under the
provisions of this Agreement and the Other Documents and to exercise such powers
and to perform such duties hereunder and thereunder as are specifically
delegated to or required of Agent by the terms hereof and thereof and such other
powers as are reasonably incidental thereto and Agent shall hold all Collateral,
payments of principal and interest, fees (except the fees set forth in the Fee
Letter), charges and collections (without giving effect to any collection days)
received pursuant to this Agreement, for the ratable benefit of Lenders. Agent
may perform any of its duties hereunder by or through its agents or employees.
As to any matters not expressly provided for by this Agreement (including
collection of the Notes) Agent shall not be required to exercise any discretion
or take any action, but shall be required to act or to refrain from acting (and
shall be fully protected in so acting or refraining from acting) upon the
instructions of the Required Lenders, and such instructions shall be binding;
provided, however, that Agent shall not be required to take any action which
exposes Agent to liability or which is contrary to this Agreement or the Other
Documents or Applicable Law unless Agent is furnished with an indemnification
reasonably satisfactory to Agent with respect thereto.

14.2. Nature of Duties. Agent shall have no duties or responsibilities except
those expressly set forth in this Agreement and the Other Documents. Neither
Agent nor any of its officers, directors, employees or agents shall be
(i) liable for any action taken or omitted by them as such hereunder or in
connection herewith, unless caused by their gross (not mere) negligence or
willful misconduct (as determined by a court of competent jurisdiction in a
final non-appealable judgment), or (ii) responsible in any manner for any
recitals, statements, representations or warranties made by any Borrower or any
officer thereof contained in this Agreement, or in any of the Other Documents or
in any certificate, report, statement or other document referred to or provided
for in, or received by Agent under or in connection with, this Agreement or any
of the Other Documents or for the value, validity, effectiveness, genuineness,
due execution, enforceability or sufficiency of this Agreement, or any of the
Other Documents or for any failure of any Borrower to perform its obligations
hereunder. Agent shall not be under any obligation to any Lender to ascertain or
to inquire as to the observance or performance of any of the agreements
contained in, or conditions of, this Agreement or any of the Other Documents, or
to inspect the properties, books or records of any Borrower. The duties of Agent
as respects the Advances to Borrowers shall be mechanical and administrative in
nature; Agent shall not have by reason of this Agreement a fiduciary
relationship in respect of any Lender; and nothing in this Agreement, expressed
or implied, is intended to or shall be so construed as to impose upon Agent any
obligations in respect of this Agreement except as expressly set forth herein.

14.3. Lack of Reliance on Agent and Resignation. Independently and without
reliance upon Agent or any other Lender, each Lender has made and shall continue
to make (i) its own independent investigation of the financial condition and
affairs of each Borrower and each Guarantor in connection with the making and
the continuance of the Advances hereunder and the

 

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taking or not taking of any action in connection herewith, and (ii) its own
appraisal of the creditworthiness of each Borrower and each Guarantor. Agent
shall have no duty or responsibility, either initially or on a continuing basis,
to provide any Lender with any credit or other information with respect thereto,
whether coming into its possession before making of the Advances or at any time
or times thereafter except as shall be provided by any Borrower pursuant to the
terms hereof. Agent shall not be responsible to any Lender for any recitals,
statements, information, representations or warranties herein or in any
agreement, document, certificate or a statement delivered in connection with or
for the execution, effectiveness, genuineness, validity, enforceability,
collectibility or sufficiency of this Agreement or any Other Document, or of the
financial condition of any Borrower or any Guarantor, or be required to make any
inquiry concerning either the performance or observance of any of the terms,
provisions or conditions of this Agreement, the Notes, the Other Documents or
the financial condition of any Borrower, or the existence of any Event of
Default or any Default.

Agent may resign on sixty (60) days’ written notice to each of Lenders and
Borrowing Agent and upon such resignation, the Required Lenders will promptly
designate a successor Agent reasonably satisfactory to Borrowers.

Any such successor Agent shall succeed to the rights, powers and duties of
Agent, and the term “Agent” shall mean such successor agent effective upon its
appointment, and the former Agent’s rights, powers and duties as Agent shall be
terminated, without any other or further act or deed on the part of such former
Agent. After any Agent’s resignation as Agent, the provisions of this Article
XIV shall inure to its benefit as to any actions taken or omitted to be taken by
it while it was Agent under this Agreement.

14.4. Certain Rights of Agent. If Agent shall request instructions from Lenders
with respect to any act or action (including failure to act) in connection with
this Agreement or any Other Document, Agent shall be entitled to refrain from
such act or taking such action unless and until Agent shall have received
instructions from the Required Lenders; and Agent shall not incur liability to
any Person by reason of so refraining. Without limiting the foregoing, Lenders
shall not have any right of action whatsoever against Agent as a result of its
acting or refraining from acting hereunder in accordance with the instructions
of the Required Lenders.

14.5. Reliance. Agent and Lenders shall be entitled to rely, and shall be fully
protected in relying, upon any note, writing, resolution, notice, statement,
certificate, telex, teletype or telecopier message, cablegram, order or other
document or telephone message believed by it to be genuine and correct and to
have been signed, sent or made by the proper person or entity, and, with respect
to all legal matters pertaining to this Agreement and the Other Documents and
its duties hereunder, upon advice of counsel selected by it. Agent may employ
agents and attorneys-in-fact and shall not be liable for the default or
misconduct of any such agents or attorneys-in-fact selected by Agent with
reasonable care.

14.6. Notice of Default. Agent shall not be deemed to have knowledge or notice
of the occurrence of any Default or Event of Default hereunder or under the
Other Documents, unless Agent has received notice from a Lender or Borrowing
Agent referring to this Agreement or the Other Documents, describing such
Default or Event of Default and stating that such notice is a “notice of
default”. In the event that Agent receives such a notice, Agent shall give
notice

 

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thereof to Lenders. Agent shall take such action with respect to such Default or
Event of Default as shall be reasonably directed by the Required Lenders;
provided, that, unless and until Agent shall have received such directions,
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 Lenders.

14.7. Indemnification. To the extent Agent is not reimbursed and indemnified by
Borrowers, each Lender will reimburse and indemnify Agent in proportion to its
respective portion of the Advances (or, if no Advances are outstanding,
according to its Revolving Commitment Percentage), from and against any and all
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements of any kind or nature whatsoever which may be
imposed on, incurred by or asserted against Agent in performing its duties
hereunder, or in any way relating to or arising out of this Agreement or any
Other Document; provided that, Lenders shall not be liable for any portion of
such liabilities, obligations, losses, damages, penalties, actions, judgments,
suits, costs, expenses or disbursements resulting from Agent’s gross (not mere)
negligence or willful misconduct (as determined by a court of competent
jurisdiction in a final non-appealable judgment).

14.8. Agent in its Individual Capacity. With respect to the obligation of Agent
to lend under this Agreement, the Advances made by it shall have the same rights
and powers hereunder as any other Lender and as if it were not performing the
duties as Agent specified herein; and the term “Lender” or any similar term
shall, unless the context clearly otherwise indicates, include Agent in its
individual capacity as a Lender. Agent may engage in business with any Borrower
as if it were not performing the duties specified herein, and may accept fees
and other consideration from any Borrower for services in connection with this
Agreement or otherwise without having to account for the same to Lenders.

14.9. Delivery of Documents. To the extent Agent receives financial statements
required under Sections 9.5, 9.7, 9.8, 9.9, 9.12 and 9.13 or Borrowing Base
Certificates from any Borrower pursuant to the terms of this Agreement which any
Borrower is not obligated to deliver to each Lender, Agent will promptly furnish
such documents and information to Lenders.

14.10. Borrowers’ Undertaking to Agent. Without prejudice to their respective
obligations to Lenders under the other provisions of this Agreement, each
Borrower hereby undertakes with Agent to pay to Agent on demand all amounts from
time to time due and payable by it for the account of Agent or Lenders or any of
them pursuant to this Agreement to the extent not already paid. Any payment made
pursuant to any such demand shall pro tanto satisfy the relevant Borrower’s
obligations to make payments for the account of Lenders or the relevant one or
more of them pursuant to this Agreement.

14.11. No Reliance on Agent’s Customer Identification Program. Each Lender
acknowledges and agrees that neither such Lender, nor any of its Affiliates,
participants or assignees, may rely on the Agent to carry out such Lender’s,
Affiliate’s, participant’s or assignee’s customer identification program, or
other obligations required or imposed under or pursuant to the USA PATRIOT Act
or the regulations thereunder, including the regulations contained in 31 CFR
103.121 (as hereafter amended or replaced, the “CIP Regulations”), or any other
Anti-Terrorism Law, including any programs involving any of the following items
relating

 

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to or in connection with any Borrower, its Affiliates or its agents, this
Agreement, the Other Documents or the transactions hereunder or contemplated
hereby: (1) any identity verification procedures, (2) any record-keeping,
(3) comparisons with government lists, (4) customer notices or (5) other
procedures required under the CIP Regulations or such other laws.

14.12. Other Agreements. Each of the Lenders agrees that it shall not, without
the express consent of Agent, and that it shall, to the extent it is lawfully
entitled to do so, upon the request of Agent, set off against the Obligations,
any amounts owing by such Lender to any Borrower or any deposit accounts of any
Borrower now or hereafter maintained with such Lender. Anything in this
Agreement to the contrary notwithstanding, each of the Lenders further agrees
that it shall not, unless specifically requested to do so by Agent, take any
action to protect or enforce its rights arising out of this Agreement or the
Other Documents, it being the intent of Lenders that any such action to protect
or enforce rights under this Agreement and the Other Documents shall be taken in
concert and at the direction or with the consent of Agent or Required Lenders.

 

XV. BORROWING AGENCY.

15.1. Borrowing Agency Provisions.

(a) Each Borrower hereby irrevocably designates Borrowing Agent to be its
attorney and agent and in such capacity to (i) borrow, (ii) request Advances,
(iii) request the issuance of Letters of Credit, (iv) sign and endorse notes,
(v) execute and deliver all instruments, documents, applications, security
agreements, reimbursement agreements and letter of credit agreements for Letters
of Credit and all other certificates, notice, writings and further assurances
now or hereafter required hereunder, (vi) make elections regarding interest
rates, (vii) give instructions regarding Letters of Credit and agree with Issuer
upon any amendment, extension or renewal of any Letter of Credit and
(viii) otherwise take action under and in connection with this Agreement and the
Other Documents, all on behalf of and in the name such Borrower or Borrowers,
and hereby authorizes Agent to pay over or credit all loan proceeds hereunder in
accordance with the request of Borrowing Agent.

(b) The handling of this credit facility as a co-borrowing facility with a
borrowing agent in the manner set forth in this Agreement is solely as an
accommodation to Borrowers and at their request. Neither Agent nor any Lender
shall incur liability to Borrowers as a result thereof. To induce Agent and
Lenders to do so and in consideration thereof, each Borrower hereby indemnifies
Agent and each Lender and holds Agent and each Lender harmless from and against
any and all liabilities, expenses, losses, damages and claims of damage or
injury asserted against Agent or any Lender by any Person arising from or
incurred by reason of the handling of the financing arrangements of Borrowers as
provided herein, reliance by Agent or any Lender on any request or instruction
from Borrowing Agent or any other action taken by Agent or any Lender with
respect to this Section 15.1 except due to willful misconduct or gross (not
mere) negligence by the indemnified party (as determined by a court of competent
jurisdiction in a final and non-appealable judgment).

(c) All Obligations shall be joint and several, and each Borrower shall make
payment upon the maturity of the Obligations by acceleration or otherwise, and
such obligation

 

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and liability on the part of each Borrower shall in no way be affected by any
extensions, renewals and forbearance granted by Agent or any Lender to any
Borrower, failure of Agent or any Lender to give any Borrower notice of
borrowing or any other notice, any failure of Agent or any Lender to pursue or
preserve its rights against any Borrower, the release by Agent or any Lender of
any Collateral now or thereafter acquired from any Borrower, and such agreement
by each Borrower to pay upon any notice issued pursuant thereto is unconditional
and unaffected by prior recourse by Agent or any Lender to the other Borrowers
or any Collateral for such Borrower’s Obligations or the lack thereof. Each
Borrower waives all suretyship defenses.

(d) Without limiting the generality of subsection (c) above, the maximum
aggregate amount for which any Borrower shall be liable hereunder shall not
exceed the maximum amount for which such Borrower can be liable without
rendering this Agreement or any Other Document, as it relates to such Borrower,
subject to avoidance under applicable requirements of law relating to fraudulent
conveyance or fraudulent transfer (including the Uniform Fraudulent Conveyance
Act, the Uniform Fraudulent Transfer Act and Section 548 of title 11 of the
United States Code or any applicable provisions of comparable requirements of
law) (collectively, “Fraudulent Transfer Laws”). Any analysis of the provisions
of this Agreement for purposes of Fraudulent Transfer Laws shall take into
account the right of contribution established in subsection (e) below and, for
purposes of such analysis, give effect to any discharge of intercompany debt as
a result of any payment made hereunder.

(e) To the extent that any Borrower shall be required hereunder to pay any
portion of any Obligation exceeding the greater of (a) the amount of the value
actually received by such Borrower and its Subsidiaries from the Loans and other
Obligations and (b) the amount such Borrower would otherwise have paid if such
Borrower had paid the aggregate amount of the Obligations (excluding the amount
thereof repaid by a Borrower that received the benefit of the funds advanced
that constituted Obligations) in the same proportion as such Borrower’s net
worth on the date enforcement is sought hereunder bears to the aggregate net
worth of all the Borrowers on such date, then such Borrower shall be reimbursed
by such other Borrowers for the amount of such excess, pro rata, based on the
respective net worth of such other Borrowers on such date.

15.2. Waiver of Subrogation. Each Borrower expressly waives any and all rights
of subrogation, reimbursement, indemnity, exoneration, contribution of any other
claim which such Borrower may now or hereafter have against the other Borrowers
or other Person directly or contingently liable for the Obligations hereunder,
or against or with respect to the other Borrowers’ property (including, without
limitation, any property which is Collateral for the Obligations), arising from
the existence or performance of this Agreement, until termination of this
Agreement and repayment in full of the Obligations.

 

XVI. MISCELLANEOUS.

16.1. Governing Law. This Agreement and each Other Document (unless and except
to the extent expressly provided otherwise in any such Other Document), and all
matters relating hereto or thereto or arising herefrom or therefrom (whether
arising under contract law, tort law or otherwise) shall, in accordance with
Section 5-1401 of the General Obligations Law of the State of New York, be
governed by and construed in accordance with the laws of the State of New

 

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York. Any judicial proceeding brought against any Borrower with respect to any
of the Obligations, this Agreement, the Other Documents or any related agreement
may be brought in any court of competent jurisdiction in the State of New York,
United States of America, and, by execution and delivery of this Agreement, each
Borrower accepts for itself and in connection with its properties, generally and
unconditionally, the non-exclusive jurisdiction of the aforesaid courts, and
irrevocably agrees to be bound by any judgment rendered thereby in connection
with this Agreement. Each Borrower hereby waives personal service of any and all
process upon it and consents that all such service of process may be made by
certified or registered mail (return receipt requested) directed to Borrowing
Agent at its address set forth in Section 16.6 and service so made shall be
deemed completed five (5) days after the same shall have been so deposited in
the mails of the United States of America, or, at the Agent’s option, by service
upon Borrowing Agent which each Borrower irrevocably appoints as such Borrower’s
Agent for the purpose of accepting service within the State of New York. Nothing
herein shall affect the right to serve process in any manner permitted by law or
shall limit the right of Agent or any Lender to bring proceedings against any
Borrower in the courts of any other jurisdiction. Each Borrower waives any
objection to jurisdiction and venue of any action instituted hereunder and shall
not assert any defense based on lack of jurisdiction or venue or based upon
forum non conveniens. Each Borrower waives the right to remove any judicial
proceeding brought against such Borrower in any state court to any federal
court. Any judicial proceeding by any Borrower against Agent or any Lender
involving, directly or indirectly, any matter or claim in any way arising out
of, related to or connected with this Agreement or any related agreement, shall
be brought only in a federal or state court located in the County of New York,
State of New York.

16.2. Entire Understanding.

(a) This Agreement and the documents executed concurrently herewith contain the
entire understanding between each Borrower, Agent and each Lender and supersedes
all prior agreements and understandings, if any, relating to the subject matter
hereof. Any promises, representations, warranties or guarantees not herein
contained and hereinafter made shall have no force and effect unless in writing,
signed by each Borrower’s, Agent’s and each Lender’s respective officers.
Neither this Agreement nor any portion or provisions hereof may be changed,
modified, amended, waived, supplemented, discharged, cancelled or terminated
orally or by any course of dealing, or in any manner other than by an agreement
in writing, signed by the party to be charged. Each Borrower acknowledges that
it has been advised by counsel in connection with the execution of this
Agreement and Other Documents and is not relying upon oral representations or
statements inconsistent with the terms and provisions of this Agreement.

 

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(b) The Required Lenders, Agent with the consent in writing of the Required
Lenders, and Borrowers may, subject to the provisions of this Section 16.2(b),
from time to time enter into written supplemental agreements to this Agreement
or the Other Documents executed by Borrowers, for the purpose of adding or
deleting any provisions or otherwise changing, varying or waiving in any manner
the rights of Lenders, Agent or Borrowers thereunder or the conditions,
provisions or terms thereof or waiving any Event of Default thereunder, but only
to the extent specified in such written agreements; provided, however, that no
such supplemental agreement shall:

(i) increase the Revolving Commitment Percentage, or the maximum dollar amount
of the Revolving Commitment Amount of any Lender without the consent of such
Lender directly affected thereby;

(ii) whether or not any Advances are outstanding, extend the Term or the time
for payment of principal or interest of any Advance (excluding the due date of
any mandatory prepayment of an Advance), or any fee payable to any Lender, or
reduce the principal amount of or the rate of interest borne by any Advances or
reduce any fee payable to any Lender, without the consent of each Lender
directly affected thereby (except that Required Lenders may elect to waive or
rescind any imposition of the Default Rate under Section 3.1 or of default rates
of Letter of Credit fees under Section 3.2 (unless imposed by Agent));

(iii) increase the Maximum Loan Amount (except in accordance with Section 2.24)
without the consent of all Lenders;

(iv) alter the definition of the term Required Lenders or alter, amend or modify
this Section 16.2(b) without the consent of all Lenders;

(v) alter, amend or modify the provisions of Section 11.5 without the consent of
all Lenders;

(vi) release any Collateral during any calendar year (other than in accordance
with the provisions of this Agreement) having an aggregate value in excess of
$1,000,000 without the consent of all Lenders;

(vii) change the rights and duties of Agent without the consent of all Lenders;

(viii) subject to the provisions set forth below, permit any Revolving Advance
to be made if after giving effect thereto the total of Revolving Advances
outstanding hereunder would exceed the Formula Amount for more than thirty
(30) consecutive Business Days in any ninety (90) consecutive day period or
exceed the lesser of (1) one hundred and five percent (105%) of the Formula
Amount and (2) the Maximum Loan Amount minus the Maximum Undrawn Amount of
Letters of Credit minus the outstanding balance of Swing Loans without the
consent of all Lenders;

(ix) increase the Advance Rates above the Advance Rates in effect on the Closing
Date, increase the sublimits set forth in the Formula Amount or alter the
definitions of Eligible Receivables, Eligible Insured Foreign Receivables,
Eligible Un-Insured Foreign Receivables, Eligible Off-load Receivables, Eligible
Stored Natural Gas Inventory, Eligible In-Transit Inventory, Eligible On-Track
Inventory, Eligible Inventory or Eligible In-Tank Inventory in a manner that
would increase the Formula Amount without the consent of Supermajority Lenders;

(x) release any Borrower or Guarantor (except as permitted herein) without the
consent of all Lenders; or

(xi) amend or modify the pro rata treatment of Lenders as set forth in
Section 2.20 hereof without the consent of all Lenders.

 

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(c) Any such supplemental agreement shall apply equally to each Lender and shall
be binding upon Borrowers, Lenders and Agent and all future holders of the
Obligations. In the case of any waiver, Borrowers, Agent and Lenders shall be
restored to their former positions and rights, and any Event of Default waived
shall be deemed to be cured and not continuing, but no waiver of a specific
Event of Default shall extend to any subsequent Event of Default (whether or not
the subsequent Event of Default is the same as the Event of Default which was
waived), or impair any right consequent thereon.

(d) If any action to be taken by Agent or Lenders hereunder requires unanimous
consent and a Lender fails to give its consent, then provided that the Required
Lenders have provided such consent, authorization or agreement, then PNC may, at
its option, require such Lender to assign its interest in the Advances to PNC or
to another Lender or to any other Person designated by the Agent (the
“Designated Lender”), for a price equal to (i) the then outstanding principal
amount thereof plus (ii) accrued and unpaid interest and fees due such Lender,
which interest and fees shall be paid when collected from Borrowers. In the
event PNC elects to require any Lender to assign its interest to PNC or to the
Designated Lender, PNC will so notify such Lender in writing within forty five
(45) days following such Lender’s denial, and such Lender will assign its
interest to PNC or the Designated Lender no later than five (5) days following
receipt of such notice pursuant to a Commitment Transfer Supplement executed by
such Lender, PNC or the Designated Lender, as appropriate, and Agent.

(e) Notwithstanding (i) the existence of a Default or an Event of Default,
(ii) that any of the other applicable conditions precedent set forth in
Section 8.2 hereof have not been satisfied or the commitments of Lenders to make
Revolving Advances hereunder have been terminated for any reason, or (iii) any
other contrary provision of this Agreement, Agent may at its discretion and
without the consent of any Lender, voluntarily permit the outstanding Revolving
Advances at any time to exceed the Formula Amount by up to five percent (5%) of
the Formula Amount for up to thirty (30) consecutive Business Days in any ninety
(90) consecutive day period so long as the aggregate Revolving Advances
(including Out-of-Formula Loans) do not exceed the lesser of (1) one hundred and
five percent (105%) of the Formula Amount and (2) the Maximum Loan Amount minus
the Maximum Undrawn Amount of Letters of Credit minus the outstanding balance of
Swing Loans (the “Out-of-Formula Loans”). If Agent is willing in its sole and
absolute discretion to permit such Out-of-Formula Loans, the Lenders holding the
Revolving Commitments shall be obligated to fund such Out-of-Formula Loans in
accordance with their respective Revolving Commitment Percentages, and such
Out-of-Formula Loans shall be payable on demand and shall bear interest at the
Default Rate for Revolving Advances consisting of Domestic Rate Loans; provided
that, if Agent does permit Out-of-Formula Loans, neither Agent nor Lenders shall
be deemed thereby to have changed the limits of Section 2.1(a) nor shall any
Lender be obligated to fund Revolving Advances in excess of its Revolving
Commitment Amount. For purposes of this paragraph, the discretion granted to
Agent hereunder shall not preclude involuntary overadvances that may result from
time to time due to the fact that the Formula Amount was unintentionally
exceeded for any reason, including, but not limited to, Collateral previously
deemed to be either “Eligible Receivables”, “Eligible Insured Foreign
Receivables”, “Eligible Un-Insured Foreign Receivables”, “Eligible Off-load
Receivables”, “Eligible Inventory”, “Eligible In-Transit Inventory”, “Eligible
On-Track

 

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Inventory”, “Eligible In-Tank Inventory” or “Eligible Stored Natural Gas
Inventory”, as applicable, becomes ineligible, collections of Receivables
applied to reduce outstanding Revolving Advances are thereafter returned for
insufficient funds or overadvances are made to protect or preserve the
Collateral. In the event Agent involuntarily permits the outstanding Revolving
Advances to exceed the Formula Amount by more than five percent (5%), Agent
shall use its efforts to have Borrowers decrease such excess in as expeditious a
manner as is practicable under the circumstances and not inconsistent with the
reason for such excess. Revolving Advances made after Agent has determined the
existence of involuntary overadvances shall be deemed to be involuntary
overadvances and shall be decreased in accordance with the preceding sentence.
To the extent any Out-of-Formula Loans are not actually funded by the other
Lenders as provided for in this Section 16.2(e), Agent may elect in its
discretion to fund such Out-of-Formula Loans and any such Out-of-Formula Loans
so funded by Agent shall be deemed to be Revolving Advances made by and owing to
Agent, and Agent shall be entitled to all rights (including accrual of interest)
and remedies of a Lender holding a Revolving Commitment under this Agreement and
the Other Documents with respect to such Revolving Advances.

(f) In addition to (and not in substitution of) the discretionary Revolving
Advances permitted above in this Section 16.2, the Agent is hereby authorized by
Borrowers and the Lenders, at any time in the Agent’s sole discretion,
regardless of (i) the existence of a Default or an Event of Default or
termination of the commitments of Lenders to make Revolving Advances hereunder
for any reason, or (ii) any other contrary provision of this Agreement, to make
Revolving Advances to Borrowers on behalf of the Lenders which Agent, in its
reasonable business judgment, deems necessary or desirable (a) to preserve or
protect the Collateral, or any portion thereof, (b) to enhance the likelihood
of, or maximize the amount of, repayment of the Advances and other Obligations,
or (c) to pay any other amount chargeable to Borrowers pursuant to the terms of
this Agreement (the “Protective Advances”); provided, that the Protective
Advances made hereunder shall not exceed five percent (5%) of the Maximum Loan
Amount and provided further that at any time after giving effect to any such
Protective Advances, the outstanding Revolving Advances, Swing Loans and Maximum
Undrawn Amount of all outstanding Letters of Credit do not exceed the Maximum
Loan Amount. The Lenders holding the Revolving Commitments shall be obligated to
fund such Protective Advances and effect a settlement with Agent therefore upon
demand of Agent in accordance with their respective Revolving Commitment
Percentages. To the extent any Protective Advances are not actually funded by
the other Lenders as provided for in this Section 16.2(f), any such Protective
Advances funded by Agent shall be deemed to be Revolving Advances made by and
owing to Agent, and Agent shall be entitled to all rights (including accrual of
interest) and remedies of a Lender holding a Revolving Commitment under this
Agreement and the Other Documents with respect to such Revolving Advances.

16.3. Successors and Assigns; Participations; New Lenders.

(a) This Agreement shall be binding upon and inure to the benefit of Borrowers,
Agent, each Lender, all future holders of the Obligations and their respective
successors and assigns, except that no Borrower may assign or transfer any of
its rights or obligations under this Agreement without the prior written consent
of Agent and each Lender.

 

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(b) Each Borrower acknowledges that in the regular course of commercial banking
business one or more Lenders may at any time and from time to time sell
participating interests in the Advances to other Persons (each such transferee
or purchaser of a participating interest, a “Participant”); provided, however,
that (i) in no case shall a Participant have the right to enforce any of the
terms of this Agreement or any Other Document, and (ii) the consent of such
Participant shall not be required (either directly, as a restraint on such
Lender’s ability to consent hereunder or otherwise) to exercise or refrain from
exercising any powers or rights such Lender may have under or in respect of this
Agreement or any Other Documents (including the right to enforce or direct
enforcement of the Obligations) or for any amendments, waivers or consents with
respect to this Agreement or any Other Document, except for those described in
Section 16.2(b)(i), (ii) and (iv). Each Participant may exercise all rights of
payment (including rights of set-off) with respect to the portion of such
Advances held by it or other Obligations payable hereunder as fully as if such
Participant were the direct holder thereof provided that Borrowers shall not be
required to pay to any Participant more than the amount which it would have been
required to pay to Lender which granted an interest in its Advances or other
Obligations payable hereunder to such Participant had such Lender retained such
interest in the Advances hereunder or other Obligations payable hereunder and in
no event shall Borrowers be required to pay any such amount arising from the
same circumstances and with respect to the same Advances or other Obligations
payable hereunder to both such Lender and such Participant. Each Borrower hereby
grants to any Participant a continuing security interest in any deposits, moneys
or other property actually or constructively held by such Participant as
security for the Participant’s interest in the Advances.

(c) Any Lender, with the consent of Agent which shall not be unreasonably
withheld or delayed (and which shall not be required for sales, assignments or
transfers to Affiliates of any Lender), may sell, assign or transfer all or any
part of its rights and obligations under or relating to Revolving Advances under
this Agreement and the Other Documents to one or more additional Persons
(subject to Section 16.3(g) hereof) and one or more additional Persons may
commit to make Advances hereunder (each a “Purchasing Lender”), in minimum
amounts of not less than $5,000,000, pursuant to a Commitment Transfer
Supplement, executed by a Purchasing Lender, the transferor Lender, and Agent
and delivered to Agent for recording; provided, Purchasing Lenders shall not
include any Affiliate of any Borrower, Guarantor, any Defaulting Lender or
natural Person. Upon such execution, delivery, acceptance and recording, from
and after the transfer effective date determined pursuant to such Commitment
Transfer Supplement, (i) Purchasing Lender thereunder shall be a party hereto
and, to the extent provided in such Commitment Transfer Supplement, have the
rights and obligations of a Lender thereunder with a Revolving Commitment
Percentage as set forth therein, and (ii) the transferor Lender thereunder
shall, to the extent provided in such Commitment Transfer Supplement, be
released from its obligations under this Agreement, the Commitment Transfer
Supplement creating a novation for that purpose. Such Commitment Transfer
Supplement shall be deemed to amend this Agreement to the extent, and only to
the extent, necessary to reflect the addition of such Purchasing Lender and the
resulting adjustment of the Revolving Commitment Percentages arising from the
purchase by such Purchasing Lender of all or a portion of the rights and
obligations of such transferor Lender under this Agreement and the Other
Documents. Each Borrower hereby consents to the addition of such Purchasing
Lender and the resulting adjustment of the Revolving Commitment Percentages
arising from the purchase by such Purchasing Lender of all or a portion of the
rights and obligations of such transferor Lender under this Agreement and the
Other Documents. Borrowers shall execute and deliver such further documents and
do such further acts and things in order to effectuate the foregoing.

 

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(d) Any Lender, with the consent of Agent which shall not be unreasonably
withheld or delayed, may directly or indirectly sell, assign or transfer all or
any portion of its rights and obligations under or relating to Revolving
Advances under this Agreement and the Other Documents to an entity, whether a
corporation, partnership, trust, limited liability company or other entity that
(i) is engaged in making, purchasing, holding or otherwise investing in bank
loans and similar extensions of credit in the ordinary course of its business
and (ii) is administered, serviced or managed by the assigning Lender or an
Affiliate of such Lender (a “Purchasing CLO” and together with each Participant
and Purchasing Lender, each a “Transferee” and collectively the “Transferees”),
pursuant to a Commitment Transfer Supplement modified as appropriate to reflect
the interest being assigned (“Modified Commitment Transfer Supplement”),
executed by any intermediate purchaser, the Purchasing CLO, the transferor
Lender, and Agent as appropriate and delivered to Agent for recording. Upon such
execution and delivery, from and after the transfer effective date determined
pursuant to such Modified Commitment Transfer Supplement, (i) Purchasing CLO
thereunder shall be a party hereto and, to the extent provided in such Modified
Commitment Transfer Supplement, have the rights and obligations of a Lender
thereunder and (ii) the transferor Lender thereunder shall, to the extent
provided in such Modified Commitment Transfer Supplement, be released from its
obligations under this Agreement, the Modified Commitment Transfer Supplement
creating a novation for that purpose. Such Modified Commitment Transfer
Supplement shall be deemed to amend this Agreement to the extent, and only to
the extent, necessary to reflect the addition of such Purchasing CLO. Each
Borrower hereby consents to the addition of such Purchasing CLO. Borrowers shall
execute and deliver such further documents and do such further acts and things
in order to effectuate the foregoing.

(e) Agent shall maintain at its address a copy of each Commitment Transfer
Supplement and Modified Commitment Transfer Supplement delivered to it and a
register (the “Register”) for the recordation of the names and addresses of each
Lender and the outstanding principal, accrued and unpaid interest and other fees
due hereunder. The entries in the Register shall be conclusive, in the absence
of manifest error, and each Borrower, Agent and Lenders may treat each Person
whose name is recorded in the Register as the owner of the Advance recorded
therein for the purposes of this Agreement. The Register shall be available for
inspection by Borrowing Agent or any Lender at any reasonable time and from time
to time upon reasonable prior notice. Agent shall receive a fee in the amount of
$3,500 payable by the applicable Purchasing Lender and/or Purchasing CLO upon
the effective date of each transfer or assignment (other than to an intermediate
purchaser) to such Purchasing Lender and/or Purchasing CLO.

(f) Each Borrower authorizes each Lender to disclose to any Transferee and any
prospective Transferee any and all financial information in such Lender’s
possession concerning such Borrower which has been delivered to such Lender by
or on behalf of such Borrower pursuant to this Agreement or in connection with
such Lender’s credit evaluation of such Borrower.

(g) Notwithstanding anything to the contrary contained in this Agreement, any
Lender may at any time and from time to time pledge or assign a security
interest in all or any

 

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portion of its rights under this Agreement to secure obligations of such Lender,
including any pledge or assignment to secure obligations to a Federal Reserve
Bank; provided that no such pledge or assignment shall release such Lender from
any of its obligations hereunder or substitute any such pledgee or assignee for
such Lender as a party hereto.

16.4. Application of Payments. Agent shall have the continuing and exclusive
right to apply or reverse and re-apply any payment and any and all proceeds of
Collateral to any portion of the Obligations. To the extent that any Borrower
makes a payment or Agent or any Lender receives any payment or proceeds of the
Collateral for any Borrower’s benefit, which are subsequently invalidated,
declared to be fraudulent or preferential, set aside or required to be repaid to
a trustee, debtor in possession, receiver, custodian or any other party under
any bankruptcy law, common law or equitable cause, then, to such extent, the
Obligations or part thereof intended to be satisfied shall be revived and
continue as if such payment or proceeds had not been received by Agent or such
Lender.

16.5. Indemnity. Each Borrower shall defend, protect, indemnify, pay and save
harmless Agent, Issuer, each Lender and each of their respective officers,
directors, Affiliates, attorneys, employees and agents (each an “Indemnified
Party”) for and from and against any and all claims, demands, liabilities,
obligations, losses, damages, penalties, fines, actions, judgments, suits,
costs, charges, expenses and disbursements of any kind or nature whatsoever
(including fees and disbursements of counsel (including allocated costs of
internal counsel)) (collectively, “Claims”) which may be imposed on, incurred
by, or asserted against any Indemnified Party in arising out of or in any way
relating to or as a consequence, direct or indirect, of: (i) this Agreement, the
Other Documents, the Advances and other Obligations and/or the transactions
contemplated hereby including the Transactions, (ii) any action or failure to
act or action taken only after delay or the satisfaction of any conditions by
any Indemnified Party in connection with and/or relating to the negotiation,
execution, delivery or administration of the Agreement and the Other Documents,
the credit facilities established hereunder and thereunder and/or the
transactions contemplated hereby including the Transactions, (iii) any
Borrower’s or any Guarantor’s failure to observe, perform or discharge any of
its covenants, obligations, agreements or duties under or breach of any of the
representations or warranties made in this Agreement and the Other Documents,
(iv) the enforcement of any of the rights and remedies of Agent, Issuer or any
Lender under the Agreement and the Other Documents, (v) any threatened or actual
imposition of fines or penalties, or disgorgement of benefits, for violation of
any Anti-Terrorism Law by any Borrower, any Affiliate or Subsidiary of any
Borrowers, or any Guarantor, and (vi) any claim, litigation, proceeding or
investigation instituted or conducted by any Governmental Body or
instrumentality or any other Person with respect to any aspect of, or any
transaction contemplated by, or referred to in, or any matter related to, this
Agreement or the Other Documents, whether or not Agent or any Lender is a party
thereto. Without limiting the generality of any of the foregoing, each Borrower
shall defend, protect, indemnify, pay and save harmless each Indemnified Party
from (x) any Claims which may be imposed on, incurred by, or asserted against
any Indemnified Party arising out of or in any way relating to or as a
consequence, direct or indirect, of the issuance of any Letter of Credit
hereunder and (y) any Claims which may be imposed on, incurred by, or asserted
against any Indemnified Party under any Environmental Laws with respect to or in
connection with the Real Property, any Hazardous Discharge, the presence of any
Hazardous Substances affecting the Real Property (whether or not the same
originates or emerges from the Real Property or any contiguous real estate),
including

 

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any Claims consisting of or relating to the imposition or assertion of any Lien
on any of the Real Property under any Environmental Laws and any loss of value
of the Real Property as a result of the foregoing except to the extent such
loss, liability, damage and expense is attributable to any Hazardous Discharge
resulting from actions on the part of Agent or any Lender. Borrowers’
obligations under this Section 16.5 shall arise upon the discovery of the
presence of any Hazardous Substances at the Real Property, whether or not any
federal, state, or local environmental agency has taken or threatened any action
in connection with the presence of any Hazardous Substances, in each such case
except to the extent that any of the foregoing arises out of the gross
negligence or willful misconduct of the Indemnified Party (as determined by a
court of competent jurisdiction in a final and non-appealable judgment). Without
limiting the generality of the foregoing, this indemnity shall extend to any
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses and disbursements of any kind or nature whatsoever (including
fees and disbursements of counsel) asserted against or incurred by any of the
Indemnified Parties by any Person under any Environmental Laws or similar laws
by reason of any Borrower’s or any other Person’s failure to comply with laws
applicable to solid or hazardous waste materials, including Hazardous Substances
and Hazardous Waste, or other Toxic Substances. Additionally, if any taxes
(excluding taxes imposed upon or measured solely by the net income of Agent and
Lenders, but including any intangibles taxes, stamp tax, recording tax or
franchise tax) shall be payable by Agent, Lenders or Borrowers on account of the
execution or delivery of this Agreement, or the execution, delivery, issuance or
recording of any of the Other Documents, or the creation or repayment of any of
the Obligations hereunder, by reason of any Applicable Law now or hereafter in
effect, Borrowers will pay (or will promptly reimburse Agent and Lenders for
payment of) all such taxes, including interest and penalties thereon, and will
indemnify and hold the Indemnified Parties harmless from and against all
liability in connection therewith.

16.6. Notice. Any notice or request hereunder may be given to Borrowing Agent or
any Borrower or to Agent or any Lender at their respective addresses set forth
below or at such other address as may hereafter be specified in a notice
designated as a notice of change of address under this Section. Any notice,
request, demand, direction or other communication (for purposes of this
Section 16.6 only, a “Notice”) to be given to or made upon any party hereto
under any provision of this Loan Agreement shall be given or made by telephone
or in writing (which includes by means of electronic transmission (i.e.,
“e-mail”) or facsimile transmission or by setting forth such Notice on a site on
the World Wide Web (a “Website Posting”) if Notice of such Website Posting
(including the information necessary to access such site) has previously been
delivered to the applicable parties hereto by another means set forth in this
Section 16.6) in accordance with this Section 16.6. Any such Notice must be
delivered to the applicable parties hereto at the addresses and numbers set
forth under their respective names on Section 16.6 hereof or in accordance with
any subsequent unrevoked Notice from any such party that is given in accordance
with this Section 16.6. Any Notice shall be effective:

(a) In the case of hand-delivery, when delivered;

(b) If given by mail, four days after such Notice is deposited with the United
States Postal Service, with first-class postage prepaid, return receipt
requested;

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if delivery of such telephonic Notice is confirmed no later than the next
Business Day by hand delivery, a facsimile or electronic transmission, a Website
Posting or an overnight courier delivery of a confirmatory Notice (received at
or before noon on such next Business Day);

(d) In the case of a facsimile transmission, when sent to the applicable party’s
facsimile machine’s telephone number, if the party sending such Notice receives
confirmation of the delivery thereof from its own facsimile machine;

(e) In the case of electronic transmission, when actually received;

(f) In the case of a Website Posting, upon delivery of a Notice of such posting
(including the information necessary to access such site) by another means set
forth in this Section 16.6; and

(g) If given by any other means (including by overnight courier), when actually
received.

Any Lender giving a Notice to Borrowing Agent or any Borrower shall concurrently
send a copy thereof to the Agent, and the Agent shall promptly notify the other
Lenders of its receipt of such Notice.

(A) If to Agent or PNC at:

PNC Bank, National Association

200 South Wacker Drive, Suite 600

Chicago, Illinois 60606

Attention: Portfolio Manager

Telephone: 312-454-2920

Facsimile: 312-454-2919

with a copy to:

with a copy to:

PNC Bank, National Association

PNC Agency Services

PNC Firstside Center

500 First Avenue, 4th Floor

Pittsburgh, Pennsylvania 15219

Attention: Lisa Pierce

Telephone: 412-762-6442

Facsimile: 412- 762-8672

With an additional copy to:

Blank Rome LLP

One Logan Square

130 N. 18th Street

Philadelphia, Pennsylvania 19103

Attention: Lawrence F. Flick, II, Esquire

Telephone: 215-569-5556

Facsimile: 215-832-5556

 

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(B) If to a Lender other than Agent, as specified on the signature pages hereof

(C) If to Borrowing Agent or any Borrower:

Green Plains Trade Group LLC

450 Regency Parkway, Suite 400

Omaha, Nebraska 68114

Attention:   Patrich Simpkins Executive Vice President

Telephone: 402-884-8700

Facsimile:   402-884-8776

with a copy to:

c/o Green Plains Trade Group LLC

450 Regency Parkway, Suite 400

Omaha, Nebraska 68114

Attn: Michelle S. Mapes, Esquire

Telephone: 402-315-1629

Facsimile:   402-884-8776

16.7. Survival. The obligations of Borrowers under Sections 2.2(f), 3.7, 3.8,
3.9, 4.19(h), and 16.5 and the obligations of Lenders under Section 14.7, shall
survive termination of this Agreement and the Other Documents and payment in
full of the Obligations.

16.8. Severability. If any part of this Agreement is contrary to, prohibited by,
or deemed invalid under Applicable Laws, such provision shall be inapplicable
and deemed omitted to the extent so contrary, prohibited or invalid, but the
remainder hereof shall not be invalidated thereby and shall be given effect so
far as possible.

16.9. Expenses. Borrowers shall pay (i) all out-of-pocket expenses incurred by
Agent and its Affiliates (including the reasonable fees, charges and
disbursements of counsel for Agent), and shall pay all fees and time charges and
disbursements for attorneys who may be employees of Agent, in connection with
the syndication of the credit facilities provided for herein, the preparation,
negotiation, execution, delivery and administration of this Agreement and the
Other Documents or any amendments, modifications or waivers of the provisions
hereof or thereof (whether or not the transactions contemplated hereby or
thereby shall be consummated), (ii) all out-of-pocket expenses incurred by
Issuer in connection with the issuance, amendment, renewal or extension of any
Letter of Credit or any demand for payment thereunder, (iii) all out-of-pocket
expenses incurred by Agent, any Lender or Issuer (including the fees, charges
and disbursements of any counsel for Agent, any Lender or Issuer), and shall pay
all fees and time charges for attorneys who may be employees of Agent, any
Lender or Issuer, in connection with the enforcement or protection of its rights
(A) in connection with this

 

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Agreement and the Other Documents, including its rights under this Section, or
(B) in connection with the Advances made or Letters of Credit issued hereunder,
including all such out-of-pocket expenses incurred during any workout,
restructuring or negotiations in respect of such Loans or Letters of Credit, and
(iv) all reasonable out-of-pocket expenses of Agent’s regular employees and
agents engaged periodically to perform audits of any Borrower’s or any
Borrower’s Affiliate’s or Subsidiary’s books, records and business properties.

16.10. Injunctive Relief. Each Borrower recognizes that, in the event any
Borrower fails to perform, observe or discharge any of its obligations or
liabilities under this Agreement, or threatens to fail to perform, observe or
discharge such obligations or liabilities, any remedy at law may prove to be
inadequate relief to Lenders; therefore, Agent, if Agent so requests, shall be
entitled to temporary and permanent injunctive relief in any such case without
the necessity of proving that actual damages are not an adequate remedy.

16.11. Consequential Damages. Neither Agent nor any Lender, nor any agent or
attorney for any of them, shall be liable to any Borrower or any Guarantor (or
any Affiliate of any such Person) for indirect, punitive, exemplary or
consequential damages arising from any breach of contract, tort or other wrong
relating to the establishment, administration or collection of the Obligations
or as a result of any transaction contemplated under this Agreement or any Other
Document.

16.12. Captions. The captions at various places in this Agreement are intended
for convenience only and do not constitute and shall not be interpreted as part
of this Agreement.

16.13. Counterparts; Facsimile Signatures. This Agreement may be executed in any
number of and by different parties hereto on separate counterparts, all of
which, when so executed, shall be deemed an original, but all such counterparts
shall constitute one and the same agreement. Any signature delivered by a party
by facsimile transmission shall be deemed to be an original signature hereto.

16.14. Construction. The parties acknowledge that each party and its counsel
have reviewed this Agreement and that the normal rule of construction to the
effect that any ambiguities are to be resolved against the drafting party shall
not be employed in the interpretation of this Agreement or any amendments,
schedules or exhibits thereto.

16.15. Confidentiality; Sharing Information. Agent, each Lender and each
Transferee shall hold all non-public information obtained by Agent, such Lender
or such Transferee pursuant to the requirements of this Agreement in accordance
with Agent’s, such Lender’s and such Transferee’s customary procedures for
handling confidential information of this nature; provided, however, Agent, each
Lender and each Transferee may disclose such confidential information (a) to its
examiners, Affiliates, outside auditors, counsel and other professional
advisors, (b) to Agent, any Lender or to any prospective Transferees, and (c) as
required or requested by any Governmental Body or representative thereof or
pursuant to legal process; provided, further that (i) unless specifically
prohibited by Applicable Law, Agent, each Lender and each Transferee shall use
its reasonable best efforts prior to disclosure thereof, to notify the
applicable Borrower of the applicable request for disclosure of such non-public
information (A) by a Governmental Body or representative thereof (other than any
such request in connection

 

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with an examination of the financial condition of a Lender or a Transferee by
such Governmental Body) or (B) pursuant to legal process and (ii) in no event
shall Agent, any Lender or any Transferee be obligated to return any materials
furnished by any Borrower other than those documents and instruments in
possession of Agent or any Lender in order to perfect its Lien on the Collateral
once the Obligations have been paid in full and this Agreement has been
terminated. Each Borrower acknowledges that from time to time financial
advisory, investment banking and other services may be offered or provided to
such Borrower or one or more of its Affiliates (in connection with this
Agreement or otherwise) by any Lender or by one or more Subsidiaries or
Affiliates of such Lender and each Borrower hereby authorizes each Lender to
share any information delivered to such Lender by such Borrower and its
Subsidiaries pursuant to this Agreement, or in connection with the decision of
such Lender to enter into this Agreement, to any such Subsidiary or Affiliate of
such Lender, it being understood that any such Subsidiary or Affiliate of any
Lender receiving such information shall be bound by the provisions of this
Section 16.15 as if it were a Lender hereunder. Such authorization shall survive
the repayment of the other Obligations and the termination of this Agreement.

16.16. Publicity. Each Borrower and each Lender hereby authorizes Agent to make
appropriate announcements of the financial arrangement entered into among
Borrowers, Agent and Lenders, including announcements which are commonly known
as tombstones, in such publications and to such selected parties as Agent shall
in its sole and absolute discretion deem appropriate.

16.17. Certifications From Banks and Participants; USA PATRIOT Act.

(a) Each Lender or assignee or participant of a Lender that is not incorporated
under the Laws of the United States of America or a state thereof (and is not
excepted from the certification requirement contained in Section 313 of the USA
PATRIOT Act and the applicable regulations because it is both (i) an affiliate
of a depository institution or foreign bank that maintains a physical presence
in the United States or foreign country, and (ii) subject to supervision by a
banking authority regulating such affiliated depository institution or foreign
bank) shall deliver to the Agent the certification, or, if applicable,
recertification, certifying that such Lender is not a “shell” and certifying to
other matters as required by Section 313 of the USA PATRIOT Act and the
applicable regulations: (1) within 10 days after the Closing Date, and (2) as
such other times as are required under the USA PATRIOT Act.

(b) Each Lender that is subject to the Patriot Act hereby notifies the Borrowers
that the USA PATRIOT Act requires all financial institutions to obtain, verify
and record certain information that identifies individuals or business entities
which open an “account” with such financial institution. Consequently, Lender
may from time to time request, and Borrower shall provide to Lender, Borrower’s
name, address, tax identification number and/or such other identifying
information as shall be necessary for Lender to comply with the USA PATRIOT Act
and any other Anti-Terrorism Law.

16.18. Anti-Terrorism Laws.

(a) Each Borrower represents and warrants that (i) no Covered Entity is a
Sanctioned Person and (ii) no Covered Entity, either in its own right or through
any third party,

 

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(A) has any of its assets in a Sanctioned Country or in the possession, custody
or control of a Sanctioned Person in violation of any Anti-Terrorism Law;
(B) does business in or with, or derives any of its income from investments in
or transactions with, any Sanctioned Country or Sanctioned Person in violation
of any Anti-Terrorism Law; or (C) engages in any dealings or transactions
prohibited by any Anti-Terrorism Law.

(b) Each Borrower covenants and agrees that (i) no Covered Entity will become a
Sanctioned Person, (ii) no Covered Entity, either in its own right or through
any third party, will (A) have any of its assets in a Sanctioned Country or in
the possession, custody or control of a Sanctioned Person in violation of any
Anti-Terrorism Law; (B) do business in or with, or derive any of its income from
investments in or transactions with, any Sanctioned Country or Sanctioned Person
in violation of any Anti-Terrorism Law; (C) engage in any dealings or
transactions prohibited by any Anti-Terrorism Law or (D) use the Advances to
fund any operations in, finance any investments or activities in, or, make any
payments to, a Sanctioned Country or Sanctioned Person in violation of any
Anti-Terrorism Law, (iii) the funds used to repay the Obligations will not be
derived from any unlawful activity, (iv) each Covered Entity shall comply with
all Anti-Terrorism Laws and (v) the Borrowers shall promptly notify the Agent in
writing upon the occurrence of a Reportable Compliance Event.

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Each of the parties has signed this Agreement as of the day and year first above
written.

 

BORROWER:     GREEN PLAINS TRADE GROUP LLC     By:  

  /s/ Jerry L. Peters

    Name:   Jerry L. Peters     Title:   Chief Financial Officer

 

[SIGNATURE PAGE TO THIRD AMENDED AND RESTATED REVOLVING CREDIT AND SECURITY
AGREEMENT]

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AGENT:

   

PNC BANK, NATIONAL ASSOCIATION,

as Agent

    By:  

  /s/ James Simpson

    Name:   James Simpson     Title:   Vice President

 

[SIGNATURE PAGE TO THIRD AMENDED AND RESTATED REVOLVING CREDIT AND SECURITY
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LENDER:

   

PNC BANK, NATIONAL ASSOCIATION,

as Lender

    By:  

  /s/ James Simpson

    Name:   James Simpson     Title:   Vice President    

Revolving Commitment Percentage:

33.333333333%

    Revolving Commitment Amount $50,000,000

 

[SIGNATURE PAGE TO THIRD AMENDED AND RESTATED REVOLVING CREDIT AND SECURITY
AGREEMENT]

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LENDER:

   

BANK OF AMERICA,

as a Lender

    By:  

  /s/ Charles Fairchild

    Name:     Charles Fairchild     Title:     Vice President     Revolving
Commitment Percentage: 30%     Revolving Commitment Amount: $45,000,000    
Address for notices:    

Bank of America

135 S. LaSalle Street

Chicago, IL 60603

Attention: Charles Fairchild, Vice President

Tel: 312-904-7153

Fax: 312-904-7190

 

[SIGNATURE PAGE TO THIRD AMENDED AND RESTATED REVOLVING CREDIT AND SECURITY
AGREEMENT]

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LENDER:

    CITIBANK, N.A., as a Lender     By:  

  /s/ Miles D. McManus

    Name:     Miles D. McManus     Title:     Authorized Signer    

Revolving         Commitment         Percentage:

23.333333333%

    Revolving Commitment Amount: $35,000,000     Address for Notice:    

Citibank, N.A.

1 Court Square, 18th Floor

Long Island City, NY 11101

Attention: Miles McManus

Tel: 718-248-3706

Fax: 718-248-2676

    With a copy to:    

Citibank, N.A.

1 Court Square, 18th Floor

Long Island City, NY 11101

Attention: Mick Chow

Tel: 718-248-1765

Fax: 718-248-2676

 

[SIGNATURE PAGE TO THIRD AMENDED AND RESTATED REVOLVING CREDIT AND SECURITY
AGREEMENT]

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LENDER:

    BMO HARRIS BANK N.A., as a Lender     By:  

  /s/ Terrence McKenna

    Name:     Terrence McKenna     Title:     Vice President    

Revolving         Commitment         Percentage:

13.333333333%

    Revolving Commitment Amount: $20,000,000     Address for Notice:    

BMO Harris Bank N.A.

111 West Monroe Street Floor 20 East

Chicago, IL 60603

Attention: Green Plains PM

Telephone: 312-461-7760

Facsimile: 312-293-8532

    With a copy to:    

BMO Harris Bank N.A.

111 West Monroe Street Floor 20 East

Chicago, IL 60603

Attention: Craig Thistlewaite

Telephone: 312-461-2171

Facsimile: 312-765-1641

 

[SIGNATURE PAGE TO THIRD AMENDED AND RESTATED REVOLVING CREDIT AND SECURITY
AGREEMENT]

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