Exhibit 10.1

 

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$110,000,000

CREDIT AGREEMENT

Dated as of August 31, 2006

Among

SECURE COMPUTING CORPORATION

as Borrower,

THE LENDERS PARTY HERETO,

CITICORP USA, INC.,

as Administrative Agent and Swingline Lender,

and

UBS SECURITIES LLC,

as Syndication Agent

 

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CITIGROUP GLOBAL MARKETS INC.

and

UBS SECURITIES LLC,

as Joint Lead Arrangers,

and

CITIGROUP GLOBAL MARKETS INC.

and

UBS SECURITIES LLC,

as Joint Bookrunners

 

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Cahill Gordon & Reindel LLP

80 Pine Street

New York, New York 10005

 

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TABLE OF CONTENTS

 

          Page    ARTICLE I       DEFINITIONS   

SECTION 1.01.

  

Defined Terms

   1

SECTION 1.02.

  

Terms Generally

   29

SECTION 1.03.

  

Effectuation of Transfers

   30    ARTICLE II       THE CREDITS   

SECTION 2.01.

  

Commitments

   30

SECTION 2.02.

  

Loans and Borrowings

   30

SECTION 2.03.

  

Requests for Borrowings

   31

SECTION 2.04.

  

Swingline Loans

   32

SECTION 2.05.

  

Letters of Credit

   33

SECTION 2.06.

  

Funding of Borrowings

   37

SECTION 2.07.

  

Interest Elections

   38

SECTION 2.08.

  

Termination and Reduction of Commitments

   39

SECTION 2.09.

  

Repayment of Loans; Evidence of Debt

   39

SECTION 2.10.

  

Repayment of Term Loans and Revolving Facility Loans

   40

SECTION 2.11.

  

Prepayment of Loans

   42

SECTION 2.12.

  

Fees

   42

SECTION 2.13.

  

Interest

   43

SECTION 2.14.

  

Alternate Rate of Interest

   44

SECTION 2.15.

  

Increased Costs

   44

SECTION 2.16.

  

Break Funding Payments

   45

SECTION 2.17.

  

Taxes

   45

SECTION 2.18.

  

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

   47

SECTION 2.19.

  

Mitigation Obligations; Replacement of Lenders

   49

SECTION 2.20.

  

Illegality

   50    ARTICLE III       REPRESENTATIONS AND WARRANTIES   

SECTION 3.01.

  

Organization; Powers

   50

SECTION 3.02.

  

Authorization

   50

SECTION 3.03.

  

Enforceability

   51

SECTION 3.04.

  

Governmental Approvals

   51

SECTION 3.05.

  

Financial Statements

   51

SECTION 3.06.

  

No Material Adverse Change or Material Adverse Effect

   52

SECTION 3.07.

  

Title to Properties; Possession Under Leases

   52

SECTION 3.08.

  

Subsidiaries

   53

 

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          Page

SECTION 3.09.

  

Litigation; Compliance with Laws

   53

SECTION 3.10.

  

Federal Reserve Regulations

   54

SECTION 3.11.

  

Investment Company Act

   54

SECTION 3.12.

  

Use of Proceeds

   54

SECTION 3.13.

  

Tax Returns

   54

SECTION 3.14.

  

No Material Misstatements

   55

SECTION 3.15.

  

Employee Benefit Plans

   55

SECTION 3.16.

  

Environmental Matters

   55

SECTION 3.17.

  

Security Documents

   56

SECTION 3.18.

  

Location of Real Property and Leased Premises

   57

SECTION 3.19.

  

Solvency

   57

SECTION 3.20.

  

Labor Matters

   58

SECTION 3.21.

  

Insurance

   58

SECTION 3.22.

  

Anti-Terrorism Law

   58

SECTION 3.23.

  

Acquisition Agreement; Representations and Warranties in Acquisition Agreement

   59

SECTION 3.24.

  

Intellectual Property

   59

SECTION 3.25.

  

Agreements

   60    ARTICLE IV       CONDITIONS OF LENDING   

SECTION 4.01.

  

All Credit Events

   60

SECTION 4.02.

  

First Credit Event

   61    ARTICLE V       AFFIRMATIVE COVENANTS   

SECTION 5.01.

  

Existence; Businesses and Properties

   63

SECTION 5.02.

  

Insurance

   64

SECTION 5.03.

  

Taxes

   64

SECTION 5.04.

  

Financial Statements, Reports, etc.

   64

SECTION 5.05.

  

Litigation and Other Notices

   66

SECTION 5.06.

  

Compliance with Laws

   66

SECTION 5.07.

  

Maintaining Records; Access to Properties and Inspections

   66

SECTION 5.08.

  

Use of Proceeds

   67

SECTION 5.09.

  

Compliance with Environmental Laws

   67

SECTION 5.10.

  

Further Assurances; Mortgages

   67

SECTION 5.11.

  

Fiscal Year; Accounting

   69

SECTION 5.12.

  

Maintenance of Ratings

   69

SECTION 5.13.

  

Post-Closing Collateral Matters

   69    ARTICLE VI       NEGATIVE COVENANTS   

SECTION 6.01.

  

Indebtedness

   69

SECTION 6.02.

  

Liens

   71

 

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          Page

SECTION 6.03.

  

Sale and Lease-Back Transactions

   73

SECTION 6.04.

  

Investments, Loans and Advances

   73

SECTION 6.05.

  

Mergers, Consolidations, Sales of Assets and Acquisitions

   75

SECTION 6.06.

  

Dividends and Distributions

   76

SECTION 6.07.

  

Transactions with Affiliates

   77

SECTION 6.08.

  

Business of the Borrower and the Subsidiaries

   78

SECTION 6.09.

  

Limitation on Modifications of Indebtedness; Modifications of Certificate of
Incorporation, By-Laws and Certain Other Agreements; etc.

   78

SECTION 6.10.

  

Maximum Capital Expenditures

   79

SECTION 6.11.

  

Interest Coverage Ratio

   80

SECTION 6.12.

  

Consolidated Leverage Ratio

   81

SECTION 6.13.

  

Swap Agreements

   81    ARTICLE VII       EVENTS OF DEFAULT   

SECTION 7.01.

  

Events of Default

   81

SECTION 7.02.

  

Borrower’s Right to Cure

   84

SECTION 7.03.

  

Exclusion of Immaterial Subsidiaries

   84    ARTICLE VIII       THE AGENTS   

SECTION 8.01.

  

Appointment

   84

SECTION 8.02.

  

Delegation of Duties

   85

SECTION 8.03.

  

Exculpatory Provisions

   85

SECTION 8.04.

  

Reliance by Agents

   85

SECTION 8.05.

  

Notice of Default

   85

SECTION 8.06.

  

Non-Reliance on Agents and Other Lenders

   86

SECTION 8.07.

  

Indemnification

   86

SECTION 8.08.

  

Agent in Its Individual Capacity

   86

SECTION 8.09.

  

Successor Administrative Agents

   87

SECTION 8.10.

  

Syndication Agent

   87    ARTICLE IX       MISCELLANEOUS   

SECTION 9.01.

  

Notices

   87

SECTION 9.02.

  

Survival of Agreement

   88

SECTION 9.03.

  

Binding Effect

   88

SECTION 9.04.

  

Successors and Assigns

   88

SECTION 9.05.

  

Expenses; Indemnity

   92

SECTION 9.06.

  

Right of Set-off

   93

SECTION 9.07.

  

Applicable Law

   93

SECTION 9.08.

  

Waivers; Amendment

   93

SECTION 9.09.

  

Interest Rate Limitation

   95

 

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          Page

SECTION 9.10.

  

Entire Agreement

   95

SECTION 9.11.

  

WAIVER OF JURY TRIAL

   95

SECTION 9.12.

  

Severability

   96

SECTION 9.13.

  

Counterparts

   96

SECTION 9.14.

  

Headings

   96

SECTION 9.15.

  

Jurisdiction; Consent to Service of Process

   96

SECTION 9.16.

  

Confidentiality

   96

SECTION 9.17.

  

Direct Website Communications

   97

SECTION 9.18.

  

Release of Liens and Guarantees

   98

SECTION 9.19.

  

USA Patriot Act

   98

Exhibits and Schedules

 

Exhibit A    Form of Assignment and Acceptance Exhibit B    Form of
Administrative Questionnaire Exhibit C-1    Form of Borrowing Request Exhibit
C-2    Form of Swingline Borrowing Request Exhibit D    Form of Collateral
Agreement Exhibit E    Form of Solvency Certificate Exhibit F-1    Form of Term
Loan Note Exhibit F-2    Form of Revolving Loan Note Exhibit G    Form of
Intercompany Note Schedule 1.01(a)    Pro Forma EBITDA Schedule 2.01   
Commitments Schedule 3.01    Organization and Good Standing Schedule 3.04   
Governmental Approvals Schedule 3.07(b)    Possession under Leases Schedule
3.08(a)    Subsidiaries Schedule 3.09    Litigation Schedule 3.16   
Environmental Matters Schedule 3.20    Labor Matters Schedule 3.21    Insurance
Schedule 3.23    Acquisition Agreement Schedule 3.24(a)    Claims against
Intellectual Property Schedule 3.24(b)    Intellectual Property Schedule 3.24(c)
   Intellectual Property Schedule 3.25    Agreements Schedule 4.02(b)    Local
Counsel Schedule 4.02(k)    Outstanding Indebtedness Schedule 5.13   
Post-Closing Collateral Matters Schedule 6.01    Indebtedness Schedule 6.02(a)
   Liens Schedule 6.04    Investments Schedule 6.07    Transactions with
Affiliates

 

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CREDIT AGREEMENT dated as of August 31, 2006 (as amended, supplemented or
otherwise modified from time to time, this “Agreement”), among SECURE COMPUTING
CORPORATION, a Delaware corporation (“Borrower”), CIPHERTRUST, INC., a Georgia
corporation, as a Subsidiary Loan Party (such term and each other capitalized
term used but not defined herein having the meaning given to it in Article I),
the LENDERS party hereto from time to time, CITICORP USA, INC., as
administrative agent (in such capacity, the “Administrative Agent”), for the
Lenders and as Swingline Lender, CITIBANK, N.A., as Issuing Bank, UBS SECURITIES
LLC, as syndication agent (in such capacity, the “Syndication Agent”) and
CITIGROUP GLOBAL MARKETS INC. and UBS SECURITIES LLC, as joint lead arrangers
(collectively and in such capacities, the “Joint Lead Arrangers”) and as joint
bookrunners.

Pursuant to and in connection with the Acquisition Agreement (with such term and
each other capitalized term used but not defined in this preamble having the
meaning assigned thereto in Article I) and the transactions contemplated
thereby, it is intended that (a) the Acquisition will be consummated in
accordance with the terms of the Acquisition Agreement and (b) the Transaction
Costs will be paid.

The Borrower has requested that the Lenders extend credit in the form of
(a) Term Loans on the Closing Date in an aggregate principal amount of $90.0
million and (b) Revolving Facility Loans, Swingline Loans and Letters of Credit
at any time and from time to time prior to the Revolving Facility Maturity Date
in an aggregate principal amount at any time outstanding not in excess of $20.0
million.

The Lenders are willing to extend such credit to the Borrower, the Swingline
Lender is willing to make Swingline Loans to the Borrower and the Issuing Bank
is willing to issue Letters of Credit for the account of the Borrower on the
terms and subject to the conditions set forth herein. Accordingly, the parties
hereto agree as follows:

ARTICLE I

DEFINITIONS

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

“ABR”, when used in reference to any Loan or Borrowing, is used when such Loan,
or the Loans comprising such Borrowing, are bearing interest at a rate
determined by reference to the Alternate Base Rate.

“ABR Borrowing” shall mean a Borrowing comprised of ABR Loans.

“ABR Loan” shall mean any ABR Term Loan, ABR Revolving Loan or Swingline Loan.

“ABR Revolving Borrowing” shall mean a Borrowing comprised of ABR Revolving
Loans.

“ABR Revolving Loan” shall mean any Revolving Facility Loan bearing interest at
a rate determined by reference to the ABR in accordance with the provisions of
Article II.

“ABR Term Loan” shall mean any Term Loan bearing interest at a rate determined
by reference to the ABR in accordance with the provisions of Article II.

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“Acquisition” shall mean the acquisition of CipherTrust, Inc., a Georgia
corporation, by the Borrower pursuant to the Acquisition Agreement.

“Acquisition Agreement” shall mean the collective reference to the Agreement and
Plan of Merger, dated as of July 11, 2006, among CipherTrust, Inc., a Georgia
corporation, the Borrower, Merger Sub and CT Shareholders’ Representative LLC, a
Georgia limited liability company, and all material exhibits and schedules to
such agreement as amended on July 14, 2006, August 1, 2006 and August 30, 2006.

“Adjusted LIBO Rate” shall mean, with respect to any Eurocurrency Borrowing for
any Interest Period, an interest rate per annum (rounded upwards, if necessary,
to the next 1/100 of 1%) equal to (a) the LIBO Rate in effect for such Interest
Period divided by (b) one minus the Statutory Reserves applicable to such
Eurocurrency Borrowing, if any.

“Adjustment Date” shall have the meaning assigned to such term in the definition
of “Pricing Grid.”

“Administrative Agent” shall have the meaning assigned to such term in the
introductory paragraph of this Agreement.

“Administrative Agent Fees” shall have the meaning assigned to such term in
Section 2.12(c).

“Administrative Questionnaire” shall mean an Administrative Questionnaire in the
form of Exhibit B.

“Affiliate” shall mean, when used with respect to a specified person, another
person that directly, or indirectly through one or more intermediaries, Controls
or is Controlled by or is under common Control with the person specified;
provided, however, no Agent or Lender shall be deemed to be an Affiliate of any
Loan Party by virtue of its execution of this Agreement.

“Agent Parties” shall have the meaning assigned to such term in Section 9.17(c).

“Agents” shall mean the Administrative Agent and the Syndication Agent.

“Agreement” shall have the meaning assigned to such term in the introductory
paragraph of this Agreement.

“Alternate Base Rate” shall mean a rate per annum equal to the greater of
(a) the Base Rate and (b) the Federal Funds Effective Rate in effect on such day
plus 1/2 of 1%. If for any reason the Administrative Agent shall have determined
(which determination shall be conclusive absent manifest error) that it is
unable to ascertain the Federal Funds Effective Rate, including the failure of
the Federal Reserve Bank of New York to publish rates or the inability of the
Administrative Agent to obtain quotations in accordance with the terms thereof,
the Alternate Base Rate shall be determined without regard to clause (b) of the
preceding sentence until the circumstances giving rise to such inability no
longer exist. Any change in the Alternate Base Rate due to a change in the Base
Rate or the Federal Funds Effective Rate shall be effective on the effective
date of such change in the Base Rate or the Federal Funds Effective Rate,
respectively.

“Anti-Terrorism Law” shall have the meaning assigned to such term in
Section 3.22(a).

 

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“Applicable Margin” shall mean, for any day, 3.25% per annum in the case of any
Eurocurrency Loan and 2.25% per annum in the case of any ABR Loan; provided that
on and after the first Adjustment Date, the Applicable Margin for Revolving
Facility Loans, Term Loans and Swingline Loans will be determined pursuant to
the Pricing Grid.

“Approved Fund” shall have the meaning assigned to such term in Section 9.04(b).

“Assignee” shall have them meaning assigned to such term in Section 9.04(b).

“Assignment and Acceptance” shall mean an assignment and acceptance entered into
by a Lender and an assignee, and accepted by the Administrative Agent and the
Borrower (if required by such assignment and acceptance), in the form of Exhibit
A or such other form as shall be approved by the Administrative Agent.

“Auto-Renewal Letter of Credit” shall have the meaning assigned to such term in
Section 2.05(c).

“Availability Period” shall mean the period from and including the Closing Date
to but excluding the earlier of the Revolving Facility Maturity Date and in the
case of each of the Revolving Facility Loans, Revolving Facility Borrowings,
Swingline Loans, Swingline Borrowings and Letters of Credit, the date of
termination of the Revolving Facility Commitments.

“Available Unused Commitment” shall mean, with respect to a Revolving Facility
Lender at any time, an amount equal to the amount by which (a) the Revolving
Facility Commitment of such Revolving Facility Lender at such time exceeds
(b) the Revolving Facility Credit Exposure (excluding the Swingline Exposure of
such Revolving Facility Lender) of such Revolving Facility Lender at such time.

“Base Rate” shall mean, for any day, a rate per annum that is equal to the
corporate base rate of interest established by Citibank, N.A. from time to time;
each change in the Base Rate shall be effective on the date such change is
effective. The corporate base rate is not necessarily the lowest rate charged by
the Administrative Agent to its customers.

“Board” shall mean the Board of Governors of the Federal Reserve System of the
United States of America.

“Borrower” shall have the meaning assigned to such term in the introductory
paragraph of this Agreement.

“Borrowing” shall mean a group of Loans of a single Type under a single Facility
and made on a single date and, in the case of Eurocurrency Loans, as to which a
single Interest Period is in effect.

“Borrowing Minimum” shall mean $500,000.

“Borrowing Multiple” shall mean $100,000.

“Borrowing Request” shall mean a request by the Borrower in accordance with the
terms of Section 2.03 and substantially in the form of Exhibit C-1.

“Budget” shall have the meaning assigned to such term in Section 5.04(e).

 

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“Business Day” shall mean any day that is not a Saturday, Sunday or other day on
which commercial banks in New York City are authorized or required by law to
remain closed; provided that when used in connection with a Eurocurrency Loan,
the term “Business Day” shall also exclude any day on which banks are not open
for dealings in deposits in the applicable currency in the London interbank
market.

“Capital Expenditures” shall mean, for any person in respect of any period, the
aggregate of all expenditures made in cash and incurred by such person during
such period that, in accordance with GAAP, are or should be included in
“additions to property, plant or equipment” or similar items reflected in the
statement of cash flows of such person, provided, however, that Capital
Expenditures for the Borrower and its Subsidiaries shall not include:

(a) expenditures to the extent they are made with funds that would have
constituted Net Proceeds under clause (a) of the definition of the term “Net
Proceeds” (but that will not constitute Net Proceeds as a result of the first
proviso to such clause (a)),

(b) expenditures of proceeds of insurance settlements, condemnation awards and
other settlements in respect of lost, destroyed, damaged or condemned assets,
equipment or other property to the extent such expenditures are made to replace
or repair such lost, destroyed, damaged or condemned assets, equipment or other
property or otherwise to acquire, maintain, develop, construct, improve, upgrade
or repair assets or properties useful in the business of the Borrower and its
Subsidiaries,

(c) interest capitalized during such period,

(d) expenditures that constitute operating lease expenses,

(e) expenditures that are accounted for as capital expenditures of such person
and that actually are paid for by a third party (excluding the Borrower or any
Subsidiary) and for which neither the Borrower nor any Subsidiary has provided
or is required to provide or incur, directly or indirectly, any consideration or
obligation to such third party or any other person (whether before, during or
after such period),

(f) the book value of any asset owned by such person prior to or during such
period to the extent that such book value is included as a capital expenditure
during such period as a result of such person reusing or beginning to reuse such
asset during such period without a corresponding expenditure actually having
been made in such period; provided that (i) any expenditure necessary in order
to permit such asset to be reused shall be included as a Capital Expenditure
during the period that such expenditure actually is made and (ii) such book
value shall have been included in Capital Expenditures when such asset was
originally acquired,

(g) the purchase price of equipment purchased during such period to the extent
the consideration therefor consists of any combination of (i) used or surplus
equipment traded in at the time of such purchase and (ii) the proceeds of a
concurrent sale of used or surplus equipment, in each case, in the ordinary
course of business,

(h) expenditures that constitute the Acquisition,

(i) expenditures to the extent they are financed with the proceeds of a
disposition of used, obsolete, worn out or surplus equipment or property in the
ordinary course of business, or

 

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(j) any expenditure made with the proceeds of an issuance of Equity Interests of
Borrower after the Closing Date.

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

“Cash Management Obligations” shall mean obligations owed by any Loan Party to
any Lender or Affiliate of any Lender in respect of any overdraft and related
liabilities arising from treasury and cash management services or any automated
clearing house transfer of funds.

A “Change in Control” shall mean:

(a) the acquisition of ownership, directly or indirectly, beneficially or of
record, by any person or group (within the meaning of the Exchange Act and the
rules of the SEC thereunder as in effect on the Closing Date) of Equity
Interests representing more than 35% of the aggregate ordinary voting power
represented by the issued and outstanding Equity Interests in the Borrower, or

(b) occupation of a majority of the seats (other than vacant seats) on the board
of directors of Borrower by persons who were not nominated or appointed by the
board of directors of Borrower or by the Sponsor, directly or indirectly.

“Change in Law” shall mean (a) the adoption of any law, rule or regulation after
the Closing Date, (b) any change in law, rule or regulation or in the
interpretation or application thereof by any Governmental Authority after the
Closing Date or (c) compliance by any Lender or Issuing Bank (or, for purposes
of Section 2.15(b), by any Lending Office of such Lender or by such Lender’s or
Issuing Bank’s holding company, if any) with any written request, guideline or
directive (whether or not having the force of law) of any Governmental Authority
made or issued after the Closing Date.

“Charges” shall have the meaning assigned to such term in Section 9.09.

“CipherTrust” shall mean CipherTrust, Inc., a Georgia corporation.

“Closing Date” shall mean August 31, 2006.

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

“Collateral” shall mean all the “Collateral” as defined in any Security Document
and any other property subject or purported to be subject from time to time to a
Lien under any Security Document and shall also include the Mortgaged Properties
provided, however, that, notwithstanding the foregoing, Collateral shall not
include (i) any outstanding stock of a Controlled Foreign Subsidiary in excess
of 65% of the outstanding voting Equity Interests and 100% of the non-voting
Equity Interests of such Controlled Foreign Subsidiary entitled to vote or
(ii) any asset of a Controlled Foreign Subsidiary (within the meaning of
Treasury Regulation § 1.956-2(c)(2) or any successor provision thereto) or any
subsidiary of a Controlled Foreign Subsidiary. For the avoidance of doubt, any
stock of another corporation owned by a Controlled Foreign Subsidiary is an
asset of a Controlled Foreign Subsidiary.

 

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“Collateral Agreement” shall mean the Guarantee and Collateral Agreement, as
amended, supplemented or otherwise modified from time to time, in the form of
Exhibit D, among the Borrower, each Subsidiary Loan Party and the Administrative
Agent.

“Collateral and Guarantee Requirement” shall mean the requirement that:

(a) on the Closing Date, the Administrative Agent shall have received (I) from
the Borrower and each Subsidiary Loan Party, a counterpart of the Collateral
Agreement duly executed and delivered on behalf of such person and (II) an
Acknowledgment and Consent in the form attached to the Collateral Agreement,
executed and delivered by each issuer of Pledged Collateral (as defined in the
Collateral Agreement), if any, that is not a Loan Party and that is an Affiliate
of a Loan Party;

(b) on the Closing Date or as otherwise provided in the Collateral Agreement,
the Administrative Agent shall have received (I) a pledge of all the issued and
outstanding Equity Interests of (A) each Domestic Subsidiary owned on the
Closing Date directly by or on behalf of Borrower or any Subsidiary Loan Party;
(II) a pledge of 65% of the outstanding voting Equity Interests and 100% of the
non-voting Equity Interests of each “first tier” Foreign Subsidiary domiciled in
the United Kingdom directly owned by Borrower or a Subsidiary Loan Party, such
pledge to be made pursuant to a Foreign Pledge Agreement; (III) a pledge of 65%
of the outstanding voting Equity Interests and 100% of the non-voting Equity
Interests of each other “first tier” Foreign Subsidiary directly owned by
Borrower or a Subsidiary Loan Party and (IV) all certificates or other
instruments (if any) representing such Equity Interests, together with stock
powers or other instruments of transfer with respect thereto endorsed in blank;

(c) on the Closing Date and at all times thereafter, all Indebtedness of
Borrower and each Subsidiary that is not a Controlled Foreign Subsidiary (other
than to the extent that a pledge of such promissory note or instrument would
violate applicable law) that is owing to any Loan Party shall be evidenced by an
Intercompany Note and shall have been pledged pursuant to the Collateral
Agreement, and the Administrative Agent shall have received all such
Intercompany Notes, together with note powers or other instruments of transfer
with respect thereto endorsed in blank;

(d) in the case of any person that becomes a Subsidiary Loan Party after the
Closing Date, the Administrative Agent shall have received a supplement to the
Collateral Agreement, in the form specified therein, duly executed and delivered
on behalf of such Subsidiary Loan Party within the period of time specified in
Section 5.10(d);

(e) in the case of any person that becomes a “first tier” Foreign Subsidiary
directly owned by the Borrower or a Subsidiary Loan Party after the Closing
Date, the Administrative Agent shall have received, as promptly as practicable
within the period of time specified in Section 5.10(e) following a request by
the Administrative Agent, a pledge of 65% of the outstanding voting Equity
Interests and 100% of the non-voting Equity Interests of such Foreign Subsidiary
and, if reasonably requested by the Administrative Agent, a Foreign Pledge
Agreement, duly executed and delivered on behalf of such Foreign Subsidiary and
the direct parent company of such Foreign Subsidiary;

(f) after the Closing Date, all the outstanding Equity Interests of (A) any
person that becomes a Subsidiary Loan Party after the Closing Date and
(B) subject to Section 5.10(g), all the Equity Interests that are acquired by a
Loan Party after the Closing Date, shall have been pledged pursuant to the
Collateral Agreement (provided that in no event shall more than 65% of the
issued

 

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and outstanding voting Equity Interests of any “first tier” Foreign Subsidiary
directly owned by such Loan Party be pledged to secure Obligations of the
Borrower, and in no event shall any of the issued and outstanding Equity
Interests of any Foreign Subsidiary that is not a “first tier” Foreign
Subsidiary be pledged to secure Obligations of the Borrower), and the
Administrative Agent shall have received all certificates or other instruments
(if any) representing such Equity Interests, together with stock powers or other
instruments of transfer with respect thereto endorsed in blank;

(g) except as contemplated by any Security Document, all documents and
instruments, including Uniform Commercial Code financing statements, required by
law or reasonably requested by the Administrative Agent to be executed, filed,
registered or recorded to create the Liens intended to be created by the
Security Documents (in each case, including any supplements thereto) and perfect
such Liens to the extent required by, and with the priority required by, the
Security Documents, shall have been executed, filed, registered or recorded or
delivered to the Administrative Agent for filing, registration or the recording
concurrently with, or promptly following, the execution and delivery of each
such Security Document or a supplement thereto within the period of time
specified therein;

(h) in connection with each Mortgage required pursuant to Section 5.10(c), the
Administrative Agent shall receive (i) a policy or policies or marked-up
unconditional binder of title insurance or foreign equivalent thereof, as
applicable, paid for by the Borrower, issued by a nationally recognized title
insurance company insuring the Lien of each Mortgage to be entered into as a
valid first Lien on the Mortgaged Property described therein, free of any other
Liens except as permitted by Section 6.02, together with such endorsements,
coinsurance and reinsurance as the Administrative Agent may reasonably request,
(ii) a survey of any Mortgaged Property (and all improvements thereon), or
foreign equivalent thereof, as applicable, which is (1) dated (or redated) not
earlier than six months prior to the date of delivery thereof unless there shall
have occurred within six months prior to such date of delivery any exterior
construction on the site of such Mortgaged Property, in which event such survey
shall be dated (or redated) after the completion of such construction or if such
construction shall not have been completed as of such date of delivery, not
earlier than 20 days prior to such date of delivery, (2) certified by the
surveyor (in a manner reasonably acceptable to the Administrative Agent) to the
Administrative Agent and the title insurance company insuring the Mortgage,
(3) complying in all respects with the minimum detail requirements of the
American Land Title Association as such requirements are in effect on the date
of preparation of such survey and (4) sufficient for such title insurance
company to remove all standard survey exceptions from the title insurance policy
relating to such Mortgaged Property or otherwise reasonably acceptable to the
Administrative Agent or an affidavit of no change to an existing survey;
provided that such title insurance company issues the title insurance policy
with full survey coverage, including all survey-related endorsements; and

(i) except as disclosed on Schedule 3.04 or as otherwise contemplated by any
Security Document, each Loan Party shall have obtained all consents and
approvals required to be obtained by it in connection with (i) the execution and
delivery of all Security Documents (or supplements thereto) to which it is a
party and the granting by it of the Liens thereunder and (ii) the performance of
its obligations thereunder.

“Commitment Fee” shall have the meaning assigned to such term in
Section 2.12(a).

 

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“Commitment Fee Rate” shall mean a rate equal to 0.50% per annum; provided that
on and after the first Adjustment Date, the Commitment Fee Rate will be
determined pursuant to the Pricing Grid.

“Commitments” shall mean (a) with respect to any Lender, such Lender’s Revolving
Facility Commitment and Term Loan Commitment and (b) with respect to any
Swingline Lender, its Swingline Commitment.

“Communications” shall have the meaning assigned to such term in
Section 9.17(a).

“Conduit Lender” shall mean any special purpose corporation organized and
administered by any Lender for the purpose of making Loans otherwise required to
be made by such Lender and designated by such Lender in a written instrument;
provided that the designation by any Lender of a Conduit Lender shall not
relieve the designating Lender of any of its obligations to fund a Loan under
this Agreement if, for any reason, its Conduit Lender fails to fund any such
Loan, and the designating Lender (and not the Conduit Lender) shall have the
sole right and responsibility to deliver all consents and waivers required or
requested under this Agreement with respect to its Conduit Lender, and provided,
further, that no Conduit Lender shall (a) to the extent applicable to such
Conduit Lender, be entitled to receive any greater amount pursuant to
Section 2.15, 2.16, 2.17 or 9.05 than the designating Lender would have been
entitled to receive in respect of the extensions of credit made by such Conduit
Lender or (b) be deemed to have any Commitment.

“Consolidated Debt” at any date shall mean the sum of (without duplication) all
Indebtedness within the meaning of clause (a), (b), (d), (e) (to the extent, in
the case of clause (e), any payments are actually made in respect of such
Guarantees) or (f) of the definition of “Indebtedness” (other than letters of
credit to the extent undrawn); provided that the Merger Note will not be
included in “Consolidated Debt”.

“Consolidated Leverage Ratio” shall mean, on any date, the ratio of
(a) Consolidated Debt as of such date to (b) EBITDA for the period of four
consecutive fiscal quarters of the Borrower most recently ended as of such date,
all determined on a consolidated basis in accordance with GAAP; provided that
EBITDA shall be determined for the relevant Test Period on a Pro Forma Basis;
provided, further, that if the last paragraph of the definition of EBITDA is
applicable for any period for which EBITDA is to be used to calculate
Consolidated Leverage Ratio, EBITDA shall only be determined on a Pro Forma
Basis for any events specified in the definition of Pro Forma Basis if such
events occur following the Closing Date.

“Consolidated Net Income” shall mean, with respect to any person for any period,
the aggregate of the Net Income of such person and its subsidiaries for such
period, on a consolidated basis; provided, however, that, without duplication,

(i) any net after-tax (A) extraordinary or (B) unusual gains or losses or income
or expenses (less all fees and expenses relating thereto) including, without
limitation, any severance expenses, and fees, expenses or charges related to any
offering of Equity Interests of Borrower, any Investment or Indebtedness
permitted to be incurred hereunder (in each case, whether or not successful),
including any such fees, expenses, charges or change in control payments related
to the Transactions, in each case, shall be excluded, provided, however, that
the Borrower shall deliver to the Administrative Agent a certificate of a
Financial Officer of the Borrower setting forth such extraordinary or unusual
gains or losses or income or expenses and calculations supporting them in
reasonable detail,

 

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(ii) any net after-tax income or loss from discontinued operations and any net
after-tax gain or loss on disposal of discontinued operations shall be excluded,

(iii) any net after-tax gain or loss (less all fees and expenses or charges
relating thereto) attributable to business dispositions or asset dispositions
other than in the ordinary course of business (as determined in good faith by
the board of directors of the Borrower) shall be excluded,

(iv) any net after-tax income or loss (less all fees and expenses or charges
relating thereto) attributable to the early extinguishment of indebtedness shall
be excluded,

(v) Consolidated Net Income for such period shall not include the cumulative
effect of a change in accounting principles during such period,

(vi) any increase in amortization or depreciation or any one-time non-cash
charges resulting from purchase accounting in connection with the Transactions
shall be excluded,

(vii) any non-cash impairment charges resulting from the application of
Statement of Financial Accounting Standards No. 142 and 144, and the
amortization of intangibles arising pursuant to No. 141, shall be excluded,

(viii) any currency translation gains and losses related to currency
remeasurements of Indebtedness (including the net loss or gain resulting from
Swap Agreements for currency exchange risk) shall be excluded,

(ix) any adjustments resulting from the application of Statement of Financial
Accounting Standards No. 133 shall be excluded,

(x) any non-cash compensation expenses realized from grants of stock
appreciation or similar rights, stock options or other rights to officers,
directors and employees of such person or any of its subsidiaries shall be
excluded, and

(xi) accruals and reserves that are established within twelve months after the
Closing Date and that are so required to be established in accordance with GAAP
shall be excluded.

“Consolidated Total Assets” shall mean, as of any date, the total assets of the
Borrower and its consolidated Subsidiaries, determined in accordance with GAAP,
as set forth on the consolidated balance sheet of the Borrower as of such date.

“Control” shall mean the possession, directly or indirectly, of the power to
direct or cause the direction of the management or policies of a person, whether
through the ownership of voting securities, by contract or otherwise, and
“Controlling” and “Controlled” shall have meanings correlative thereto.

“Controlled Foreign Subsidiary” means a Foreign Subsidiary that is a “controlled
foreign corporation” as defined in Section 957(a) of the Code.

“Credit Event” shall have the meaning assigned to such term in Article IV.

“Cure Amount” shall have the meaning assigned to such term in Section 7.02(a).

“Cure Right” shall have the meaning assigned to such term in Section 7.02(a).

 

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“Debt Service” shall mean, with respect to the Borrower and its Subsidiaries on
a consolidated basis for any period, Interest Expense paid in cash for such
period plus scheduled principal amortization of Consolidated Debt for such
period.

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

“Defaulting Lender” shall mean any Lender with respect to which a Lender Default
is in effect.

“Dollars” or “$” shall mean lawful money of the United States of America.

“Domestic Subsidiary” shall mean any Subsidiary that is not a Foreign
Subsidiary.

“EBITDA” shall mean, with respect to Borrower and its Subsidiaries on a
consolidated basis for any period, the Consolidated Net Income of Borrower and
its Subsidiaries for such period plus (a) the sum of (in each case without
duplication and to the extent the respective amounts described in subclauses
(i) through (vi) of this clause (a) reduced such Consolidated Net Income for the
respective period for which EBITDA is being determined):

(i) provision for Taxes based on income, profits or capital of the Borrower and
its Subsidiaries for such period, including, without limitation, state,
franchise and similar taxes and foreign withholding taxes paid or accrued during
such period,

(ii) Interest Expense of the Borrower and its Subsidiaries for such period (net
of interest income of the Borrower and its Subsidiaries for such period),

(iii) depreciation and amortization expenses of the Borrower and its
Subsidiaries for such period,

(iv) restructuring charges; provided, that with respect to each restructuring
charge, the Borrower shall have delivered to the Administrative Agent an
officers’ certificate specifying and quantifying such charge and stating that
such charge is a restructuring charge,

(v) any other non-cash charges; provided that, for purposes of this
subclause (v) of this clause (a), any non-cash charges or losses shall be
treated as cash charges or losses in any subsequent period during which cash
disbursements attributable thereto are made,

(vi) the deferred revenue eliminated as a consequence of the application of
purchase accounting adjustments as a consequence of the acquisition of
CipherTrust, Inc. shall be included for the fiscal periods that such revenue
would otherwise have been recognized, and

minus (b) the sum of (without duplication and to the extent the amounts
described in this clause (b) increased such Consolidated Net Income for the
respective period for which EBITDA is being determined) non-cash charges
increasing Consolidated Net Income of the Borrower and its Subsidiaries for such
period (but excluding any such charges (i) in respect of which cash was received
in a prior period or will be received in a future period or (ii) which represent
the reversal of any accrual of, or cash reserve for, anticipated cash charges in
any prior period). Notwithstanding the foregoing, EBITDA shall exclude other
income.

 

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For purposes of this Agreement, EBITDA for the quarter ended March 31, 2006
shall be deemed to be $8.7 million, for the quarter ended June 30, 2006 shall be
$2.8 million and for the quarter ended September 30, 2006 shall be as determined
by Borrower on a pro forma basis as if the Acquisition had occurred on July 1,
2006.

“Environment” shall mean ambient and indoor air, surface water and groundwater
(including potable water, navigable water and wetlands), the land surface or
subsurface strata, natural resources such as flora and fauna or as otherwise
defined in any Environmental Law.

“Environmental Laws” shall mean all applicable laws (including common law),
rules, regulations, codes, ordinances, orders, decrees or judgments, promulgated
or entered into by any Governmental Authority, relating to preservation or
protection of the environment, preservation or reclamation of natural resources,
the generation, management, Release or threatened Release of, or exposure to,
any Hazardous Material or to occupational health and safety matters (to the
extent relating to exposure to Hazardous Materials).

“Equity Interests” of any person shall mean any and all shares, interests,
rights to purchase, warrants, options, participation or other equivalents of or
interests in (however designated) equity of such person, including any preferred
stock, any limited or general partnership interest and any limited liability
company membership interest.

“ERISA” shall mean the Employee Retirement Income Security Act of 1974, as the
same may be amended from time to time.

“ERISA Affiliate” shall mean any trade or business (whether or not incorporated)
that, together with the Borrower or a Subsidiary, is treated as a single
employer under Section 414(b) or (c) of the Code, or, solely for purposes of
Section 302 of ERISA and Section 412 of the Code, is treated as a single
employer under Section 414 of the Code.

“ERISA Event” shall mean (a) any Reportable Event; (b) the existence with
respect to any Plan of an “accumulated funding deficiency” (as defined in
Section 412 of the Code or Section 302 of ERISA), whether or not waived; (c) the
filing pursuant to Section 412(d) of the Code or Section 303(d) of ERISA of an
application for a waiver of the minimum funding standard with respect to any
Plan, the failure to make by its due date a required installment under
Section 412(m) of the Code with respect to any Plan or the failure to make any
required contribution to a Multiemployer Plan; (d) the incurrence by the
Borrower, a Subsidiary or any ERISA Affiliate of any liability under Title IV of
ERISA with respect to the termination of any Plan; (e) the receipt by the
Borrower, a Subsidiary or any ERISA Affiliate from the PBGC or a plan
administrator of any notice relating to an intention to terminate any Plan or to
appoint a trustee to administer any Plan under Section 4042 of ERISA; (f) the
incurrence by the Borrower, a Subsidiary or any ERISA Affiliate of any liability
with respect to the withdrawal or partial withdrawal from any Plan or
Multiemployer Plan; or (g) the receipt by the Borrower, a Subsidiary or any
ERISA Affiliate of any notice, or the receipt by any Multiemployer Plan from the
Borrower, a Subsidiary or any ERISA Affiliate of any notice, concerning the
imposition of Withdrawal Liability or a determination that a Multiemployer Plan
is, or is expected to be, insolvent or in reorganization, within the meaning of
Title IV of ERISA.

“Eurocurrency Borrowing” shall mean a Borrowing comprised of Eurocurrency Loans.

“Eurocurrency Loan” shall mean any Eurocurrency Term Loan or Eurocurrency
Revolving Loan.

 

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“Eurocurrency Revolving Borrowing” shall mean a Borrowing comprised of
Eurocurrency Revolving Loans.

“Eurocurrency Revolving Loan” shall mean any Revolving Facility Loan bearing
interest at a rate determined by reference to the Adjusted LIBO Rate in
accordance with the provisions of Article II.

“Eurocurrency Term Loan” shall mean any Term Loan bearing interest at a rate
determined by reference to the Adjusted LIBO Rate in accordance with the
provisions of Article II.

“Event of Default” shall have the meaning assigned to such term in Section 7.01.

“Excess Cash Flow” shall mean, with respect to the Borrower and its Subsidiaries
on a consolidated basis for any Excess Cash Flow Period, EBITDA of the Borrower
and its Subsidiaries on a consolidated basis for such Excess Cash Flow Period,
minus, without duplication,

(a) Debt Service for such Excess Cash Flow Period,

(b) (i) Capital Expenditures by the Borrower and its Subsidiaries on a
consolidated basis during such Excess Cash Flow Period that are paid in cash to
the extent permitted hereunder and (ii) the aggregate consideration paid in cash
during the Excess Cash Flow Period in respect of Investments permitted hereunder
to the extent not financed with the proceeds of Indebtedness other than the
Loans (less any amount received in respect thereof as a return of capital),

(c) Capital Expenditures that the Borrower or any Subsidiary shall, during such
Excess Cash Flow Period, become obligated to make but that are not made during
such Excess Cash Flow Period; provided that Borrower shall deliver a certificate
to the Administrative Agent not later than 90 days after the end of such Excess
Cash Flow Period, signed by a Responsible Officer of the Borrower and certifying
that such Capital Expenditures and the delivery of the related equipment will be
made in the following Excess Cash Flow Period,

(d) Taxes paid in cash by the Borrower and its Subsidiaries on a consolidated
basis during such Excess Cash Flow Period or that will be paid within six months
after the close of such Excess Cash Flow Period (provided that any amount so
deducted that will be paid after the close of such Excess Cash Flow Period shall
not be deducted again in a subsequent Excess Cash Flow Period) and for which
reserves have been established, including income tax expense and withholding tax
expense incurred in connection with cross-border transactions involving the
Foreign Subsidiaries,

(e) cash expenditures made in respect of Swap Agreements during such Excess Cash
Flow Period, to the extent not deducted in the computation of EBITDA or Interest
Expense during such Excess Cash Flow Period,

(f) Investments permitted hereunder made pursuant to Section 6.04 during such
Excess Cash Flow Period,

(g) amounts paid in cash during such Excess Cash Flow Period on account of
(x) items that were accounted for as noncash reductions of Net Income in
determining Consolidated Net Income or as noncash reductions of Consolidated Net
Income in determining EBITDA of the Borrower and its Subsidiaries in a prior
Excess Cash Flow Period and (y) reserves or accruals established in purchase
accounting, and

 

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(h) the amount related to items that were added to or not deducted from Net
Income in calculating Consolidated Net Income or were added to or not deducted
from Consolidated Net Income in calculating EBITDA to the extent such items
represented a cash payment (which had not reduced Excess Cash Flow upon the
accrual thereof in a prior Excess Cash Flow Period), or an accrual for a cash
payment, by the Borrower and its Subsidiaries or did not represent cash received
by the Borrower and its Subsidiaries, in each case on a consolidated basis
during such Excess Cash Flow Period,

plus, without duplication,

(1) all proceeds received during such Excess Cash Flow Period of Capital Lease
Obligations, purchase money Indebtedness, Sale and Lease-Back Transactions and
any other Indebtedness, in each case to the extent used to finance any Capital
Expenditure (other than Indebtedness under this Agreement to the extent there is
no corresponding deduction to Excess Cash Flow above in respect of the use of
such Borrowings),

(2) all amounts referred to in clause (a) above to the extent funded with the
proceeds of the issuance of Equity Interests of, or capital contributions to,
Borrower after the Closing Date (to the extent not previously used to prepay
Indebtedness (other than Revolving Facility Loans or Swingline Loans), make any
investment or capital expenditure or otherwise for any purpose resulting in a
deduction to Excess Cash Flow in any prior Excess Cash Flow Period) or any
amount that would have constituted Net Proceeds under clause (a) of the
definition of the term “Net Proceeds” if not so spent, in each case to the
extent there is a corresponding deduction from Excess Cash Flow above,

(3) to the extent any permitted Capital Expenditures referred to in clause
(c) above and the delivery of the related equipment do not occur in the
following Excess Cash Flow Period of the Borrower specified in the certificate
of the Borrower provided pursuant to clause (b) above, the amount of such
Capital Expenditures that were not so made in such following Excess Cash Flow
Period,

(4) cash payments received in respect of Swap Agreements during such Excess Cash
Flow Period to the extent (i) not included in the computation of EBITDA or
(ii) such payments do not reduce Interest Expense,

(5) any extraordinary or nonrecurring gain realized in cash during such Excess
Cash Flow Period (except to the extent such gain consists of Net Proceeds
subject to Section 2.11(b)),

(6) to the extent deducted in the computation of EBITDA, cash interest income,
and

(7) the amount related to items that were deducted from or not added to Net
Income in connection with calculating Consolidated Net Income or were deducted
from or not added to Consolidated Net Income in calculating EBITDA to the extent
either (x) such items represented cash received by the Borrower or any
Subsidiary or (y) such items do not represent cash paid by the Borrower or any
Subsidiary, in each case on a consolidated basis during such Excess Cash Flow
Period.

“Excess Cash Flow Period” shall mean each fiscal year of the Borrower commencing
with the 2007 fiscal year.

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

 

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“Excluded Indebtedness” shall mean all Indebtedness permitted to be incurred
under Section 6.01.

“Excluded Taxes” shall mean, with respect to the Administrative Agent, any
Lender, any Issuing Bank or any other recipient of any payment to be made by or
on account of any obligation of the Borrower hereunder, (a) income or franchise
taxes imposed on (or measured by) its net income, however denominated, (or
franchise taxes or minimum Taxes imposed in lieu of net income taxes) by a
jurisdiction as a result of the Administrative Agent, such Lender, such Issuing
Bank or such other recipient being organized or having its principal office in
or, in the case of any Lender, having its applicable Lending Office in such
jurisdiction or otherwise imposed as a result of a connection between the
Administrative Agent, any Lender, any Issuing Bank or any other recipient of any
payment to be made by or on account of any obligation of the Borrower hereunder,
as applicable, and the jurisdiction of the Governmental Authority imposing such
tax or any political subdivision or taxing authority thereof or therein (other
than any such connection arising from such Administrative Agent, Lender, Issuing
Bank or other such recipient of payment having executed, delivered or performed
its obligations or received a payment under, or enforced, or otherwise with
respect to, this Agreement), (b) any branch profits tax or any similar tax that
is imposed by any jurisdiction described in clause (a) above and (c) in the case
of a Lender (other than a Lender who became a Lender pursuant to a request by a
Borrower pursuant to Section 2.19(b)), (x) any United States federal withholding
tax imposed under a law that is in effect at the time such Lender becomes a
party to such Loan to the Borrower (or designates a new Lending Office) except
to the extent that such Lender (or its assignor, if any) was entitled,
immediately prior to the time of designation of a new Lending Office (or
assignment), to receive additional amounts from a Loan Party with respect to any
withholding tax pursuant to Section 2.17(a) or Section 2.17(c) and (y) any
withholding tax that is attributable to such Lender’s failure to comply with
Section 2.17(e) or (f) with respect to such Loan.

“Executive Order” shall have the meaning assigned to such term in
Section 3.22(a).

“Facility” shall mean the applicable facility and commitments utilized in making
Loans and credit extensions hereunder, it being understood that as of the
Closing Date there are two Facilities, i.e., the Term Facility and the Revolving
Facility.

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

“Fee Letter” shall mean that certain Amended and Restated Fee Letter dated
July 14, 2006 by and among the Borrower, the Agents and the Joint Lead
Arrangers.

“Fees” shall mean the Commitment Fees, the L/C Participation Fees, the Issuing
Bank Fees and the Administrative Agent Fees.

“Financial Officer” of any person shall mean the Chief Financial Officer, vice
president of finance, principal accounting officer, Treasurer, Assistant
Treasurer or Controller of such person.

“Financial Performance Covenants” shall mean the covenants of the Borrower set
forth in Sections 6.11 and 6.12.

 

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“Foreign Lender” shall mean any Lender that is organized under the laws of a
jurisdiction other than the United States of America. 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 Plan” shall mean any employee benefit plan, program, policy,
arrangement or agreement maintained or contributed to by, or entered into with,
the Borrower or any Subsidiary with respect to employees employed outside the
United States, which provides, or results in, retirement income, a deferral of
income in contemplation of retirement, and which is not subject to ERISA or the
Code.

“Foreign Pledge Agreement” shall mean a pledge agreement with respect to the
Pledged Collateral that constitutes Equity Interests of a “first tier” Foreign
Subsidiary, in form and substance reasonably satisfactory to the Administrative
Agent and accompanied by an opinion of counsel in such relevant jurisdiction as
to the perfection of the Administrative Agent’s security interest in such Equity
Interests; provided that in no event shall more than 65% of the issued and
outstanding voting Equity Interests of such Foreign Subsidiary be pledged to
secure Obligations of the Borrower.

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

“GAAP” shall mean generally accepted accounting principles in effect from time
to time in the United States, applied on a consistent basis, subject to the
provisions of Section 1.02.

“Governmental Authority” shall mean any federal, state, local or foreign court
or governmental agency, authority, instrumentality or regulatory or legislative
body.

“Guarantee” of or by any person (the “guarantor”) shall mean (a) any obligation,
contingent or otherwise, of the guarantor guaranteeing or having the economic
effect of guaranteeing any Indebtedness or other obligation of any other person
(the “primary obligor”) in any manner, whether directly or indirectly, and
including any obligation of the guarantor, direct or indirect, (i) to purchase
or pay (or advance or supply funds for the purchase or payment of) such
Indebtedness or other obligation (whether arising by virtue of partnership
arrangements, by agreement to keep well, to purchase assets, goods, securities
or services, to take-or-pay or otherwise) or to purchase (or to advance or
supply funds for the purchase of) any security for the payment of such
Indebtedness or other obligation, (ii) to purchase or lease property, securities
or services for the purpose of assuring the owner of such Indebtedness or other
obligation of the payment thereof, (iii) to maintain working capital, equity
capital or any other financial statement condition or liquidity of the primary
obligor so as to enable the primary obligor to pay such Indebtedness or other
obligation, (iv) entered into for the purpose of assuring in any other manner
the holders of such Indebtedness or other obligation of the payment thereof or
to protect such holders against loss in respect thereof (in whole or in part) or
(v) as an account party in respect of any letter of credit or letter of guaranty
issued to support such Indebtedness or other obligation, or (b) any Lien on any
assets of the guarantor securing any Indebtedness (or any existing right,
contingent or otherwise, of the holder of Indebtedness to be secured by such a
Lien) of any other person, whether or not such Indebtedness or other obligation
is assumed by the guarantor; provided, however, that the term “Guarantee” shall
not include endorsements for collection or deposit, in either case in the
ordinary course of business, or customary and reasonable indemnity obligations
in effect on the Closing Date or entered into in connection with any acquisition
or disposition of assets permitted under this Agreement. The amount of any
Guarantee shall be deemed to be an amount equal to the stated or determinable
amount of the primary obligation in respect of which such Guarantee is made or,
if not so stated or determinable, the maximum reasonably anticipated liability
in respect thereof (assuming such person is required to perform thereunder) as
reasonably determined by the Borrower in good faith. The term “Guarantee” used
as a verb has the corresponding meaning.

 

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“guarantor” shall have the meaning assigned to such term in the definition of
the term “Guarantee.”

“Hazardous Materials” shall mean all pollutants, contaminants, wastes,
chemicals, materials, substances and constituents of any nature which are
subject to regulation or which would reasonably be likely to give rise to
liability under applicable Environmental Law, including, without limitation,
explosive or radioactive substances or petroleum or petroleum distillates,
asbestos or asbestos-containing materials, polychlorinated biphenyls or radon
gas.

“Indebtedness” of any person shall mean, without duplication, (a) all
obligations of such person for borrowed money, (b) all obligations of such
person evidenced by bonds, debentures, notes or similar instruments to the
extent the same would appear as a liability on a balance sheet prepared in
accordance with GAAP, (c) all obligations of such person under conditional sale
or other title retention agreements relating to property or assets purchased by
such person, (d) all obligations of such person issued or assumed as the
deferred purchase price of property or services (other than current trade
liabilities and current intercompany liabilities (but not any refinancings,
extensions, renewals or replacements thereof) incurred in the ordinary course of
business and maturing within 365 days after the incurrence thereof), to the
extent that the same would be required to be shown as a long term liability on a
balance sheet prepared in accordance with GAAP, (e) all Guarantees by such
person of Indebtedness of others, (f) all Capital Lease Obligations of such
person, (g) all payments that such person would have to make in the event of an
early termination, on the date Indebtedness of such person is being determined,
in respect of outstanding Swap Agreements, (h) the principal component of all
obligations, contingent or otherwise, of such person as an account party in
respect of letters of credit and (i) the principal component of all obligations
of such person in respect of bankers’ acceptances. The Indebtedness of any
person shall include the Indebtedness of any partnership in which such person is
a general partner, other than to the extent that the instrument or agreement
evidencing such Indebtedness expressly limits the liability of such person in
respect thereof.

“Indemnified Taxes” shall mean all Taxes other than Excluded Taxes and Other
Taxes.

“Indemnitee” shall have the meaning assigned to such term in Section 9.05(b).

“Information” shall have the meaning assigned to such term in Section 3.14(a).

“Information Memorandum” shall mean the Confidential Information Memorandum
dated August 2006, as modified or supplemented prior to the Closing Date.

“Intellectual Property” shall have the meaning assigned to such term in
Section 3.24(a).

“Intercompany Note” shall mean a promissory note substantially in the form of
Exhibit G.

“Interest Coverage Ratio” shall have the meaning assigned to such term in
Section 6.11.

“Interest Election Request” shall mean a request by the Borrower to convert or
continue a Term Borrowing or Revolving Borrowing in accordance with
Section 2.07.

 

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“Interest Expense” shall mean, with respect to any person for any period, the
sum of (a) gross interest expense of such person for such period on a
consolidated basis, including (i) the amortization of debt discounts, (ii) the
amortization of all fees (including fees with respect to Swap Agreements)
payable in connection with the incurrence of Indebtedness to the extent included
in interest expense and (iii) the portion of any payments or accruals with
respect to Capital Lease Obligations allocable to interest expense and
(b) capitalized interest of such person. For purposes of the foregoing, gross
interest expense shall be determined after giving effect to any net payments
made or received and costs incurred by the Borrower and its Subsidiaries with
respect to Swap Agreements.

“Interest Payment Date” shall mean, (a) with respect to any Eurocurrency Loan,
the last day of the Interest Period applicable to the Borrowing of which such
Loan is a part and, in the case of a Eurocurrency Borrowing with an Interest
Period of more than three months’ duration, each day that would have been an
Interest Payment Date had successive Interest Periods of three months’ duration
been applicable to such Borrowing and, in addition, the date of any refinancing
or conversion of such Borrowing with or to a Borrowing of a different Type,
(b) with respect to any ABR Loan, the last Business Day of each calendar quarter
and (c) with respect to any Swingline Loan, the day that such Swingline Loan is
required to be repaid pursuant to Section 2.09(a).

“Interest Period” shall mean, as to any Eurocurrency Borrowing, the period
commencing on the date of such Borrowing or on the last day of the immediately
preceding Interest Period applicable to such Borrowing, as applicable, and
ending on the numerically corresponding day (or, if there is no numerically
corresponding day, on the last day) in the calendar month that is 1, 2, 3 or 6
months thereafter (or 9 or 12 months, if at the time of the relevant Borrowing,
available to all relevant Lenders), as the Borrower may elect, or the date any
Eurocurrency Borrowing is converted to an ABR Borrowing in accordance with
Section 2.07 or repaid or prepaid in accordance with Section 2.09, 2.10 or 2.11;
provided, unless the Administrative Agent shall otherwise agree, that with
respect to periods commencing prior to the 31st day after the Closing Date, the
Borrower shall only be permitted to request Interest Periods of one month;
provided, however, that if any Interest Period would end on a day other than a
Business Day, such Interest Period shall be extended to the next succeeding
Business Day unless such next succeeding Business Day would fall in the next
calendar month, in which case such Interest Period shall end on the next
preceding Business Day. Interest shall accrue from and including the first day
of an Interest Period to but excluding the last day of such Interest Period.

“Investment” shall have the meaning assigned to such term in Section 6.04.

“Issuing Bank” shall mean Citibank, N.A., and each other Issuing Bank designated
pursuant to Section 2.05(k), in each case in its capacity as an issuer of
Letters of Credit hereunder, and its successors in such capacity as provided in
Section 2.05(i) and, solely with respect to an Existing Letter of Credit (and
any amendment, renewal or extension thereof in accordance with this Agreement),
the Lender that issued such Existing Letter of Credit. An Issuing Bank may, in
its discretion, arrange for one or more Letters of Credit to be issued by
Affiliates of such Issuing Bank, in which case the term “Issuing Bank” shall
include any such Affiliate with respect to Letters of Credit issued by such
Affiliate.

“Issuing Bank Fees” shall have the meaning assigned to such term in
Section 2.12(b).

“Joint Lead Arrangers” shall have the meaning assigned to such term in the
introductory paragraph of this Agreement.

“L/C Commitment” shall mean the commitment of each Issuing Bank to issue Letters
of Credit pursuant to Section 2.05. The aggregate amount of the L/C Commitment
shall initially be $5.0 million, but shall in no event exceed the Revolving
Commitment.

 

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“L/C Disbursement” shall mean a payment or disbursement made by an Issuing Bank
pursuant to a Letter of Credit.

“L/C Participation Fee” shall have the meaning assigned such term in
Section 2.12(b).

“Lender” shall mean each financial institution listed on Schedule 2.01, as well
as any person that becomes a “Lender” hereunder pursuant to Section 9.04.

“Lender Default” shall mean (i) the refusal (which has not been retracted) of a
Lender to make available when required hereunder its portion of any Borrowing,
to acquire participations in a Swingline Loan pursuant to Section 2.04 or to
fund its portion of any unreimbursed payment under Section 2.05(e), or (ii) a
Lender having notified in writing the Borrower and/or the Administrative Agent
that it does not intend to comply with its obligations under Section 2.04, 2.05
or 2.06.

“Lending Office” shall mean, as to any Lender, the applicable branch, office or
Affiliate of such Lender designated by such Lender to make Loans.

“Letter of Credit” shall mean any letter of credit issued pursuant to
Section 2.05.

“LIBO Rate” shall mean, with respect to any Eurocurrency Borrowing for any
Interest Period, the rate per annum determined by the Administrative Agent at
approximately 11:00 a.m., London time, on the Quotation Day for such Interest
Period by reference to the British Bankers’ Association Interest Settlement
Rates for deposits in the currency of such Borrowing (as reflected on the
applicable Telerate screen page), for a period equal to such Interest Period;
provided that, to the extent that an interest rate is not ascertainable pursuant
to the foregoing provisions of this definition, the “LIBO Rate” shall be the
average (rounded upward, if necessary, to the next 1/100 of 1%) of the
respective interest rates per annum at which deposits in the currency of such
Borrowing are offered for such Interest Period to major banks in the London
interbank market by the principal London office of the bank serving as the
Administrative Agent at approximately 11:00 a.m., London time, on the Quotation
Day for such Interest Period.

“Lien” shall mean, with respect to any asset, (a) any mortgage, deed of trust,
lien, hypothecation, pledge, encumbrance, charge or security interest in or on
such asset, (b) the interest of a vendor or a lessor under any conditional sale
agreement, capital lease or title retention agreement (or any financing lease
having substantially the same economic effect as any of the foregoing) relating
to such asset and (c) in the case of securities (other than securities
representing an interest in a joint venture that is not a Subsidiary), any
purchase option, call or similar right of a third party with respect to such
securities to the extent that any such right is intended to have an effect
equivalent to that of a security interest in such securities.

“Loan Documents” shall mean this Agreement, the Letters of Credit, the Security
Documents and any Note issued under Section 2.09(e), and solely for the purposes
of Sections 4.02(h) and 7.01(c) hereof, the Fee Letter.

“Loan Parties” shall mean the Borrower and the Subsidiary Loan Parties.

“Loans” shall mean the Term Loans, the Revolving Facility Loans and the
Swingline Loans.

“Local Time” shall mean New York City time.

“Margin Stock” shall have the meaning assigned to such term in Regulation U.

 

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“Material Adverse Effect” shall mean a material adverse effect on the business,
operations, assets, liabilities or condition (financial or otherwise) of the
Borrower and its Subsidiaries, taken as a whole.

“Material Indebtedness” shall mean Indebtedness (other than Loans and Letters of
Credit) of any one or more of the Borrower or any Subsidiary in an aggregate
principal amount exceeding $2.0 million.

“Maximum Rate” shall have the meaning assigned to such term in Section 9.09.

“Merger Note” shall have the meaning assigned to such term in the Acquisition
Agreement and shall be (i) in the form attached to the Acquisition Agreement (as
in effect on the Closing Date) and otherwise in form and substance reasonably
satisfactory to the Administrative Agent and (ii) in the amount required by the
Acquisition Agreement as in effect on the Closing Date.

“Merger Sub” shall mean Peach Acquisition Corp., a Georgia corporation.

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

“Mortgaged Properties” shall mean each real property encumbered by a Mortgage
pursuant to Section 5.10.

“Mortgages” shall mean the mortgages, deeds of trust or deeds to secure debt
delivered pursuant to Section 5.10, as amended, supplemented or otherwise
modified from time to time, with respect to Mortgaged Properties.

“Multiemployer Plan” shall mean a multiemployer plan as defined in
Section 4001(a)(3) of ERISA to which the Borrower or any Subsidiary or any ERISA
Affiliate (other than one considered an ERISA Affiliate only pursuant to
subsection (m) or (o) of Code Section 414) is making or accruing an obligation
to make contributions, or has within any of the preceding six plan years made or
accrued an obligation to make contributions.

“Net Income” shall mean, with respect to any person, the net income (loss) of
such person, determined in accordance with GAAP and before any reduction in
respect of preferred stock dividends.

“Net Proceeds” shall mean:

(a) 100% of the cash proceeds actually received by the Borrower or any
Subsidiary of the Borrower (including any cash payments received by way of
deferred payment of principal pursuant to a note or installment receivable or
purchase price adjustment receivable or otherwise and including casualty
insurance settlements and condemnation awards, but only as and when received)
from any loss, damage, destruction or condemnation of, or any sale, transfer or
other disposition (including any sale and leaseback of assets and any mortgage
or lease of real property) to any person of, any asset or assets of the Borrower
or any Subsidiary of the Borrower (other than those pursuant to Section 6.05(a),
(b), (c), (e), (f) or (i)), net of (i) attorneys’ fees, accountants’ fees,
investment banking fees, survey costs, title insurance premiums, and related
search and recording charges, transfer taxes, deed or mortgage recording taxes,
required debt payments and required payments of other obligations relating to
the applicable asset (other than pursuant hereto or pursuant to the Subordinated
Debt or any Permitted Refinancing Indebtedness in respect thereto), other
customary expenses and brokerage, consultant and other customary fees

 

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actually incurred in connection therewith and (ii) Taxes paid or payable as a
result thereof; provided that if no Event of Default exists and the Borrower
shall deliver a certificate of a Responsible Officer of the Borrower to the
Administrative Agent promptly following receipt of any such proceeds setting
forth the Borrower’s intention to use any portion of such proceeds to acquire,
maintain, develop, construct, improve, upgrade or repair assets useful in the
business of the Borrower and its Subsidiaries within 12 months of such receipt,
such portion of such proceeds shall not constitute Net Proceeds except to the
extent not so used or not contractually committed to be so used within such
12-month period (it being understood that if any portion of such proceeds are
not so used within such 12-month period because such amount is contractually
committed to be used and subsequent to such date such contract is terminated or
expires without such portion being so used or, in any event, if such proceeds
are not used within 180 days of such commitment (in the case of proceeds from
any consensual sale, transfer or disposition) or one year of such commitment (in
any other case), such remaining portion shall constitute Net Proceeds as of the
date of such termination or expiration without giving effect to this proviso),
and provided, further, that (x) no proceeds realized in a single transaction or
series of related transactions shall constitute Net Proceeds unless such
proceeds shall exceed $100,000 and (y) no proceeds shall constitute Net Proceeds
in any fiscal year until the aggregate amount of all such proceeds in such
fiscal year shall exceed $2.0 million;

(b) 100% of the cash proceeds from the incurrence, issuance or sale by the
Borrower or any Subsidiary of any Indebtedness (other than Excluded
Indebtedness), net of all taxes and fees (including investment banking fees),
commissions, costs and other expenses, in each case incurred in connection with
such incurrence, issuance or sale; and

(c) 50% of the cash proceeds of (i) any issuance or sale by Borrower after the
Closing Date of any Equity Interests in Borrower (including any Equity Interests
issued upon exercise of any warrant or option) or any warrants or options to
purchase Equity Interests or (ii) any contribution to the capital of Borrower.

“Non-Consenting Lender” shall have the meaning assigned to such term in
Section 2.19(c).

“Note” shall have the meaning assigned to such term in Section 2.09(e).

“Obligations” shall have the meaning assigned to such term in the Collateral
Agreement.

“OFAC” shall have the meaning assigned to such term in Section 3.22(b).

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

“Participant” shall have the meaning assigned to such term in Section 9.04(c).

“Participant Register” shall have the meaning assigned to such term in
Section 9.04(c).

“PBGC” shall mean the Pension Benefit Guaranty Corporation referred to and
defined in ERISA.

 

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“Perfection Certificate” shall mean a certificate in the form of Exhibit II to
the Collateral Agreement or any other form approved by the Administrative Agent.

“Permitted Cure Security” shall mean an equity security of Borrower having no
mandatory redemption, repurchase or similar requirements prior to the date that
is 180 days after the Term Facility Maturity Date (as in effect on the Closing
Date), and upon which all dividends or distributions (if any) shall, prior to
the date that is 180 days after the Term Facility Maturity Date (as in effect on
the Closing Date), be payable solely in additional shares of such equity
security.

“Permitted Investments” shall mean:

(a) direct obligations of the United States of America or any member of the
European Union or any agency thereof or obligations guaranteed by the United
States of America or any member of the European Union or any agency thereof, in
each case with maturities not exceeding one year from the date of acquisition
thereof;

(b) time deposit accounts, certificates of deposit and money market deposits
maturing within 180 days of the date of acquisition thereof issued by a bank or
trust company that is organized under the laws of the United States of America,
any state thereof or any foreign country recognized by the United States of
America having capital, surplus and undivided profits in excess of $250 million
and whose long-term debt, or whose parent holding company’s long-term debt, is
rated A (or such similar equivalent rating or higher by at least one nationally
recognized statistical rating organization (as defined in Rule 436 under the
Securities Act);

(c) repurchase obligations with a term of not more than 180 days for underlying
securities of the types described in clause (a) above entered into with a bank
meeting the qualifications described in clause (b) above;

(d) commercial paper, maturing not more than one year after the date of
acquisition, issued by a corporation (other than an Affiliate of the Borrower)
organized and in existence under the laws of the United States of America or any
foreign country recognized by the United States of America with a rating at the
time as of which any investment therein is made of P-1 (or higher) according to
Moody’s, or A-1 (or higher) according to S&P;

(e) securities with maturities of one year or less from the date of acquisition
issued or fully guaranteed by any State, commonwealth or territory of the United
States of America, or by any political subdivision or taxing authority thereof,
and rated at least A by S&P or A by Moody’s;

(f) shares of mutual funds whose investment guidelines restrict 95% of such
funds’ investments to those satisfying the provisions of clauses (a) through
(e) above;

(g) money market funds that (i) comply with the criteria set forth in Rule 2a-7
under the Investment Company Act of 1940, (ii) are rated AAA by S&P and Aaa by
Moody’s and (iii) have portfolio assets of at least $5,000.0 million; and

(h) time deposit accounts, certificates of deposit and money market deposits in
an aggregate face amount not in excess of 1/2 of 1% of the total assets of the
Borrower and its Subsidiaries, on a consolidated basis, as of the end of the
Borrower’s most recently completed fiscal year.

 

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“Permitted Refinancing Indebtedness” shall mean any Indebtedness issued in
exchange for, or the net proceeds of which are used to extend, refinance, renew,
replace, defease or refund (collectively, to “Refinance”), the Indebtedness
being Refinanced (or previous refinancings thereof constituting Permitted
Refinancing Indebtedness); provided that (a) the principal amount (or accreted
value, if applicable) of such Permitted Refinancing Indebtedness does not exceed
the principal amount (or accreted value, if applicable) of the Indebtedness so
Refinanced (plus unpaid accrued interest and premium thereon and underwriting
discounts, fees, commissions and expenses), (b) the average life to maturity of
such Permitted Refinancing Indebtedness is greater than or equal to that of the
Indebtedness being Refinanced or the Term Loans, (c) if the Indebtedness being
Refinanced is subordinated in right of payment to the Obligations under this
Agreement, such Permitted Refinancing Indebtedness shall be subordinated in
right of payment to such Obligations on terms at least as favorable to the
Lenders as those contained in the documentation governing the Indebtedness being
Refinanced, (d) no Permitted Refinancing Indebtedness shall have different
obligors, or greater guarantees or security, than the Indebtedness being
Refinanced and (e) except as set forth in clause (x) of the immediately
succeeding proviso, if the Indebtedness being Refinanced is secured by any
collateral (whether equally and ratably with, or junior to, the Secured Parties
or otherwise), such Permitted Refinancing Indebtedness may be secured by such
collateral on terms no less favorable to the Secured Parties than those
contained in the documentation governing the Indebtedness being Refinanced.

“Person” shall mean any natural person, corporation, business trust, joint
venture, association, company, partnership, limited liability company or
government, individual or family trusts, or any agency or political subdivision
thereof.

“Plan” shall mean any employee pension benefit plan (other than a Multiemployer
Plan) subject to the provisions of Title IV of ERISA or Section 412 of the Code
and in respect of which the Borrower, any Subsidiary or any ERISA Affiliate is
(or, if such plan were terminated, would under Section 4069 of ERISA be deemed
to be) an “employer” as defined in Section 3(5) of ERISA.

“Platform” shall have the meaning assigned to such term in Section 9.17(b).

“Pledged Collateral” shall have the meaning assigned to such term in the
Collateral Agreement provided, however, that, notwithstanding anything to the
contrary, Pledged Collateral shall not include (i) any outstanding stock of a
Controlled Foreign Subsidiary in excess of 65% of the outstanding voting Equity
Interests and 100% of the non-voting Equity Interests of such Controlled Foreign
Subsidiary entitled to vote or (ii) any asset of a Controlled Foreign Subsidiary
(within the meaning of Treasury Regulation § 1.956-2(c)(2) or any successor
provision thereto or a subsidiary of a Controlled Foreign Subsidiary. For the
avoidance of doubt, any stock of another corporation owned by a Controlled
Foreign Subsidiary is an asset of a Controlled Foreign Subsidiary.

“Post-Closing Items” shall have the meaning assigned to such term in
Section 5.13.

 

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“Pricing Grid” shall mean the table set forth below:

 

Consolidated
Leverage Ratio

   Applicable
Margin
for ABR
Revolving
Loans and
Swingline
Loans     Applicable
Margin
for
Eurocurrency
Revolving
Loans
and Swingline
Loans    

Applicable
Margin for
ABR Term
Loans    

Applicable
Margin for
Eurocurrency
Term Loans     Commitment
Fee Rate  

Greater than or equal to 2.5 to 1.0

   2.25 %   3.25 %   2.25 %   3.25 %   0.500 %

Less than 2.5 to 1.0, but greater than or equal to 1.75 to 1.0

   2.00 %   3.00 %   2.00 %   3.00 %   0.500 %

Less than 1.75 to 1.0

   1.75 %   2.75 %   2.00 %   3.00 %   0.375 %

For the purposes of the Pricing Grid, changes in the Applicable Margin for
Revolving Loans, Term Loans or the Commitment Fee Rate resulting from changes in
the Consolidated Leverage Ratio shall become effective on the date following the
Closing Date (the “Adjustment Date”) that is three Business Days after the date
on which financial statements are delivered to the Lenders pursuant to
Section 5.04 and shall remain in effect until the next change to be effected
pursuant to this paragraph. If any financial statements referred to above are
not delivered within the time periods specified in Section 5.04, then, until the
date that is three Business Days after the date on which such financial
statements are delivered, the highest rate set forth in each column of the
Pricing Grid shall apply. In addition, at all times while an Event of Default
shall have occurred and be continuing, the highest rate set forth in each column
of the Pricing Grid shall apply. Each determination of the Consolidated Leverage
Ratio pursuant to the Pricing Grid shall be made in a manner consistent with the
determination thereof pursuant to Section 6.12.

“Primary obligor” shall have the meaning given such term in the definition of
the term “Guarantee.”

“Pro Forma Basis” shall mean, as to any person, for any events that occur
subsequent to the commencement of a period for which the financial effect of
such events is being calculated, and giving effect to the events for which such
calculation is being made, such calculation as will give pro forma effect to
such events as if such events occurred on the first day of the most recent four
consecutive fiscal quarter period (the “Reference Period”) ended on or before
the occurrence of such event for which financial statements have been delivered
for the quarter or fiscal year ending on the last day of such period pursuant to
Section 5.04, or if such events occur on or before June 30, 2006, financial
statements for the Borrower and its subsidiaries generated by the Borrower that
generally comply with Section 5.04: (i) in making any determination of EBITDA,
pro forma effect shall be given to any asset disposition, any discontinued
operation or any operational change (or any similar transaction or transactions
that require a waiver or consent of the Required Lenders pursuant to
Section 6.04 or 6.05), in each case that occurred during the Reference Period
and (ii) in making any determination on a Pro Forma Basis, (x) all Indebtedness
(including Indebtedness incurred or assumed and for which the financial effect
is being calculated, whether incurred under this Agreement or otherwise, but
excluding normal fluctuations in revolving Indebtedness incurred for working
capital purposes) incurred or permanently repaid during the Reference Period
shall be deemed to have been incurred or repaid at the beginning of such period
and (y) Interest

 

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Expense of such person attributable to interest on any Indebtedness, for which
pro forma effect is being given as provided in preceding clause (x), bearing
floating interest rates shall be computed on a pro forma basis as if the rates
that would have been in effect during the period for which pro forma effect is
being given had been actually in effect during such periods.

Pro forma calculations made pursuant to the definition of the term “Pro Forma
Basis” shall be determined in good faith by a Responsible Officer of the
Borrower and, for any fiscal period ending on or prior to the first anniversary
of an asset disposition, discontinued operation or operational change (or any
similar transaction or transactions that require a waiver or consent of the
Required Lenders pursuant to Section 6.04 or 6.05), may include adjustments to
reflect operating expense reductions and other operating improvements or
synergies reasonably expected to result from such asset disposition or other
similar transaction, as follows: (x) for purposes of determining the Applicable
Margin, such adjustments shall reflect demonstrable operating expense reductions
and other demonstrable operating improvements or synergies that would be
includable in pro forma financial statements prepared in accordance with
Regulation S-X under the Securities Act; and (y) for purposes of determining
compliance with the Financial Performance Covenants and achievement of other
financial measures provided for herein, such adjustments may reflect additional
operating expense reductions and other additional operating improvements or
synergies that would not be includable in pro forma financial statements
prepared in accordance with Regulation S-X but for which substantially all of
the steps necessary for the realization thereof have been taken, are estimated
on a good faith basis by the Borrower; provided, however, that the aggregate
amount of any such adjustments with respect to operational changes shall not
exceed $3 million in any fiscal year. The Borrower shall deliver to the
Administrative Agent a certificate of a Financial Officer of the Borrower
setting forth such demonstrable or additional operating expense reductions and
other operating improvements and synergies and information and calculations
supporting them in reasonable detail.

“Pro Forma EBITDA” shall have the meaning assigned to such term in
Section 3.05(a).

“Pro Forma Financial Statements” shall have the meaning assigned to such term in
Section 3.05(a).

“Projections” shall mean the projections of the Borrower and its Subsidiaries
included in the Information Memorandum and any other projections and any
forward-looking statements (including statements with respect to booked
business) of such entities furnished to the Lenders or the Administrative Agent
by or on behalf of the Borrower or any Subsidiary prior to the Closing Date.

“Qualified Capital Stock” means any Equity Interests of any Person that does not
by its terms (or by the terms of any security into which it is convertible or
for which it is exchangeable or exercisable) or upon the happening of any event
(a) provide for scheduled payments of dividends in cash, (b) become mandatorily
redeemable or redeemable at the option of the holder thereof (other than
pursuant to customary provisions relating to redemption upon a change of control
or sale of assets) pursuant to a sinking fund obligation or otherwise prior to
the date that is 91 days after the Term Facility Maturity Date (as in effect on
the Closing Date), (c) become convertible or exchangeable at the option of the
holder thereof for Indebtedness or Equity Interests that are not Qualified
Capital Stock, or (d) contain any maintenance covenants, other covenants adverse
to the Lenders or remedies (other than voting rights and increases in
dividends).

“Quotation Day” shall mean, with respect to any Eurocurrency Borrowing and any
Interest Period, the day on which it is market practice in the relevant
interbank market for prime banks to give quotations for deposits in the currency
of such Borrowing for delivery on the first day of such Interest Period. If such
quotations would normally be given by prime banks on more than one day, the
Quotation Day will be the last of such days.

 

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“Reference Period” shall have the meaning assigned to such term in the
definition of the term “Pro Forma Basis.”

“Refinance” shall have the meaning assigned to such term in the definition of
the term “Permitted Refinancing Indebtedness,” and “Refinanced” shall have a
meaning correlative thereto.

“Register” shall have the meaning assigned to such term in Section 9.04(b).

“Regulation U” shall mean Regulation U of the Board as from time to time in
effect and all official rulings and interpretations thereunder or thereof.

“Regulation X” shall mean Regulation X of the Board as from time to time in
effect and all official rulings and interpretations thereunder or thereof.

“Related Parties” shall mean, with respect to any specified person, such
person’s Affiliates and the respective directors, trustees, officers, employees,
agents and advisors of such person and such person’s Affiliates.

“Release” shall mean any spilling, leaking, seepage, pumping, pouring, emitting,
emptying, discharging, injecting, escaping, leaching, dumping, disposing,
depositing, emanating or migrating in, into, onto or through the environment.

“Remaining Present Value” shall mean, as of any date with respect to any lease,
the present value as of such date of the scheduled future lease payments with
respect to such lease, determined with a discount rate equal to a market rate of
interest for such lease reasonably determined at the time such lease was entered
into.

“Reportable Event” shall mean any reportable event as defined in Section 4043(c)
of ERISA or the regulations issued thereunder, other than those events as to
which the 30-day notice period referred to in Section 4043(c) of ERISA has been
waived, with respect to a Plan (other than a Plan maintained by an ERISA
Affiliate that is considered an ERISA Affiliate only pursuant to subsection
(m) or (o) of Section 414 of the Code).

“Required Lenders” shall mean, at any time, Lenders having (a) Loans (other than
Swingline Loans) outstanding, (b) Revolving L/C Exposures, (c) Swingline
Exposures and (d) Available Unused Commitments, that taken together, represent
more than 50% of the sum of (w) all Loans (other than Swingline Loans)
outstanding, (x) Revolving L/C Exposures, (y) Swingline Exposures and (z) the
total Available Unused Commitments at such time. The Loans, Revolving L/C
Exposures, Swingline Exposures and Available Unused Commitment of any Defaulting
Lender shall be disregarded in determining Required Lenders at any time.

“Required Percentage” shall mean, with respect to any Excess Cash Flow Period,
50%; provided that if the Consolidated Leverage Ratio at the end of such Excess
Cash Flow Period is less than or equal to 2.00:1.00, such percentage shall be
25%.

“Responsible Officer” of any person shall mean any executive officer or
Financial Officer of such person and any other officer or similar official
thereof responsible for the administration of the obligations of such person in
respect of this Agreement.

 

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“Revolving Facility” shall mean the Revolving Facility Commitments and the
extensions of credit made hereunder by the Revolving Facility Lenders.

“Revolving Facility Borrowing” shall mean a Borrowing comprised of Revolving
Facility Loans.

“Revolving Facility Commitment” shall mean, with respect to each Revolving
Facility Lender, the commitment of such Revolving Facility Lender to make
Revolving Facility Loans pursuant to Section 2.01, expressed as an amount
representing the maximum aggregate permitted amount of such Revolving Facility
Lender’s Revolving Facility Credit Exposure hereunder, as such commitment may be
(a) reduced from time to time pursuant to Section 2.08 and (b) reduced or
increased from time to time pursuant to assignments by or to such Lender under
Section 9.04. The initial amount of each Revolving Facility Lender’s Revolving
Facility Commitment is set forth on Schedule 2.01, or in the Assignment and
Acceptance pursuant to which such Revolving Facility Lender shall have assumed
its Revolving Facility Commitment, as applicable. The initial aggregate amount
of the Revolving Facility Commitments is $20.0 million.

“Revolving Facility Credit Exposure” shall mean, at any time, the sum of (a) the
aggregate principal amount of the Revolving Facility Loans outstanding at such
time, (b) the Swingline Exposure at such time and (c) the Revolving L/C Exposure
at such time. The Revolving Facility Credit Exposure of any Revolving Facility
Lender at any time shall be the sum of (x) the aggregate principal amount of
such Revolving Facility Lender’s Revolving Facility Loans outstanding at such
time and (y) such Revolving Facility Lender’s (i) Swingline Exposure and
(ii) Revolving L/C Exposure at such time.

“Revolving Facility Lender” shall mean a Lender with a Revolving Facility
Commitment or with outstanding Revolving Facility Loans.

“Revolving Facility Loan” shall mean a Loan made by a Revolving Facility Lender
pursuant to Section 2.01(b).

“Revolving Facility Maturity Date” shall mean August 31, 2012 or, if such date
is not a Business Day, the Business Day immediately preceding such date.

“Revolving Facility Percentage” shall mean, with respect to any Revolving
Facility Lender, the percentage of the total Revolving Facility Commitments
represented by such Lender’s Revolving Facility Commitment. If the Revolving
Facility Commitments have terminated or expired, the Revolving Facility
Percentages shall be determined based upon the Revolving Facility Commitments
most recently in effect, giving effect to any assignments pursuant to
Section 9.04.

“Revolving L/C Exposure” shall mean at any time the sum of (a) the aggregate
undrawn amount of all Letters of Credit outstanding at such time and (b) the
aggregate principal amount of all L/C Disbursements that have not yet been
reimbursed at such time. The Revolving L/C Exposure of any Revolving Facility
Lender at any time shall mean its Revolving Facility Percentage of the aggregate
Revolving L/C Exposure at such time.

“S&P” shall mean Standard & Poor’s Ratings Group, Inc.

“Sale and Lease-Back Transaction” shall have the meaning assigned to such term
in Section 6.03.

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

 

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“Secured Parties” shall mean the “Secured Parties” as defined in the Collateral
Agreement.

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

“Securitization” shall mean a public or private offering by a Lender or any of
its direct or indirect Affiliates or their respective successors and assigns, of
securities or notes which represent an interest in, or which are collateralized,
in whole or in part, by the Loans and Loan Documents.

“Security Documents” shall mean the Mortgages, the Collateral Agreement, the
Foreign Pledge Agreements and each of the security agreements, mortgages and
other instruments and documents executed and delivered pursuant to any of the
foregoing or pursuant to Section 5.10.

“Social Security Act” shall mean the Social Security Act of 1965 as set forth in
Title 42 of the United States Code, as amended, and any successor statute
thereto, as interpreted by the rules and regulations issued thereunder, in each
case as in effect from time to time. References to sections of the Social
Security Act shall be construed to refer to any successor sections.

“Sponsor” shall mean Warburg Pincus LLC.

“Statutory Reserves” shall mean, with respect to any currency, any reserve,
liquid asset or similar requirements established by any Governmental Authority
of the United States of America or of the jurisdiction of such currency or any
jurisdiction in which Loans in such currency are made to which banks in such
jurisdiction are subject for any category of deposits or liabilities customarily
used to fund loans in such currency or by reference to which interest rates
applicable to Loans in such currency are determined.

“Subordinated Debt” shall mean Indebtedness of Borrower or any Subsidiary Loan
Party that is by its terms subordinated in right of payment to the Obligations
of Borrower and such Subsidiary Loan Party, as applicable.

“Subordinated Intercompany Debt” shall have the meaning assigned to such term in
Section 6.01(e).

“subsidiary” shall mean, with respect to any person (herein referred to as the
“parent”), any corporation, partnership, association or other business entity
(a) of which securities or other ownership interests representing more than 50%
of the equity or more than 50% of the ordinary voting power or more than 50% of
the general partnership interests are, at the time any determination is being
made, directly or indirectly, owned, Controlled or held, or (b) that is, at the
time any determination is made, otherwise Controlled, by the parent or one or
more subsidiaries of the parent or by the parent and one or more subsidiaries of
the parent.

“Subsidiary” shall mean, unless the context otherwise requires, a subsidiary of
the Borrower.

“Subsidiary Loan Party” shall mean (A) each Wholly Owned Subsidiary of the
Borrower that is not a Foreign Subsidiary and (B) each Domestic Subsidiary of
the Borrower other than any Domestic Subsidiary that is a subsidiary of a
Controlled Foreign Subsidiary.

“Swap Agreement” shall mean any agreement with respect to any swap, forward,
future or derivative transaction or option or similar agreement involving, or
settled by reference to, one or more

 

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rates, currencies, commodities, equity or debt instruments or securities, or
economic, financial or pricing indices or measures of economic, financial or
pricing risk or value or any similar transaction or any combination of these
transactions; provided that no phantom stock or similar plan providing for
payments only on account of services provided by current or former directors,
officers, employees or consultants of the Borrower or any Subsidiary shall be a
Swap Agreement.

“Swingline Borrowing” shall mean a Borrowing comprised of Swingline Loans.

“Swingline Borrowing Request” shall mean a request by the Borrower substantially
in the form of Exhibit C-2.

“Swingline Commitment” shall mean, with respect to each Swingline Lender, the
commitment of such Swingline Lender to make Swingline Loans pursuant to
Section 2.04. The aggregate amount of the Swingline Commitments on the Closing
Date is $5.0 million.

“Swingline Exposure” shall mean at any time the aggregate principal amount of
all outstanding Swingline Borrowings at such time. The Swingline Exposure of any
Revolving Facility Lender at any time shall mean its Revolving Facility
Percentage of the aggregate Swingline Exposure at such time.

“Swingline Lender” shall mean Citicorp USA, Inc., in its capacity as a lender of
Swingline Loans, and its successor(s) in such capacity.

“Swingline Loans” shall mean the swingline loans made to the Borrower pursuant
to Section 2.04.

“Syndication Agent” shall have the meaning assigned to such term in the
introductory paragraph of this Agreement.

“Taxes” shall mean any and all present or future taxes, levies, imposts, duties
(including stamp duties), deductions, charges (including ad valorem charges) or
withholdings imposed by any Governmental Authority and any and all interest and
penalties related thereto.

“Term Borrowing” shall mean a Borrowing comprised of Term Loans.

“Term Facility” shall mean the Term Loan Commitments and the Term Loans made
hereunder.

“Term Facility Maturity Date” shall mean August 31, 2013 or, if such date is not
a Business Day, the Business Day immediately preceding such date.

“Term Loan Commitment” shall mean with respect to each Lender, the commitment of
such Lender to make Term Loans as set forth in Section 2.01. The aggregate
amount of the Term Loan Commitments on the Closing Date is $90.0 million.

“Term Loan Installment Date” shall have the meaning assigned to such term in
Section 2.10(a).

“Term Loans” shall mean the term loans made by each lender with a Term Loan
Commitment to the Borrower pursuant to Section 2.01(a).

 

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“Test Period” shall mean, on any date of determination, the period of four
consecutive fiscal quarters of the Borrower then most recently ended (taken as
one accounting period).

“Total Assets” shall mean, as of any date, the total amount of tangible and
intangible assets of the Borrower and the Subsidiaries on a consolidated basis
at the end of the fiscal quarter immediately preceding such date.

“Transaction Costs” means fees and expenses payable or otherwise borne by the
Borrower and its Subsidiaries in connection with the Transactions occurring on
or about the Closing Date.

“Transaction Documents” shall mean the Acquisition Agreement and the Loan
Documents.

“Transactions” shall mean, collectively, the transactions to occur pursuant to
the Transaction Documents, including (a) the consummation of the Acquisitions
pursuant to the Acquisition Agreement; (b) the execution and delivery of the
Loan Documents and the initial borrowings hereunder; and (c) the payment of the
Transaction Costs.

“Type”, when used in respect of any Loan or Borrowing, shall refer to the Rate
by reference to which interest on such Loan or on the Loans comprising such
Borrowing is determined. For purposes hereof, the term “Rate” shall include the
Adjusted LIBO Rate and the ABR.

“U.S. Bankruptcy Code” shall mean Title 11 of the United States Code, as
amended, or any similar federal or state law for the relief of debtors.

“Wholly Owned Subsidiary” of any person shall mean a subsidiary of such person,
all of the Equity Interests of which (other than directors’ qualifying shares or
nominee or other similar shares required pursuant to applicable law) are owned
by such person or another Wholly Owned Subsidiary of such person.

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

SECTION 1.02. Terms Generally. The definitions set forth or referred to in
Section 1.01 shall apply equally to both the singular and plural forms of the
terms defined. Whenever the context may require, any pronoun shall include the
corresponding masculine, feminine and neuter forms. The words “include,”
“includes” and “including” shall be deemed to be followed by the phrase “without
limitation.” All references herein to Articles, Sections, Exhibits and Schedules
shall be deemed references to Articles and Sections of, and Exhibits and
Schedules to, this Agreement unless the context shall otherwise require. Except
as otherwise expressly provided herein, any reference in this Agreement to any
Loan Document shall mean such document as amended, restated, supplemented or
otherwise modified from time to time. Except as otherwise expressly provided
herein, all terms of an accounting or financial nature shall be construed in
accordance with GAAP, as in effect from time to time applied on a basis
consistent with the most recent audited financial statements of the Borrower
delivered pursuant to Section 5.04(a); provided that, if the Borrower notifies
the Administrative Agent that the Borrower requests an amendment to any
provision hereof to eliminate the effect of any change occurring after the
Closing Date in GAAP or in the application thereof on the operation of such
provision (or if the Administrative Agent notifies the Borrower that the
Required Lenders request an amendment to any provision hereof for such purpose),
regardless of whether any such notice is given before or after such change in
GAAP or in the application thereof, then such provision shall be interpreted on
the basis of GAAP as in effect and applied

 

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immediately before such change shall have become effective until such notice
shall have been withdrawn or such provision amended in accordance herewith in a
manner satisfactory to the Borrower and the Required Lenders.

SECTION 1.03. Effectuation of Transfers. Each of the representations and
warranties of the Borrower contained in this Agreement (and all corresponding
definitions) are made after giving effect to the Transactions, unless the
context otherwise requires.

ARTICLE II

THE CREDITS

SECTION 2.01. Commitments. Subject to the terms and conditions set forth herein:

(a) each Lender with a Term Loan Commitment agrees to make Term Loans to the
Borrower on the Closing Date in a principal amount not to exceed its Term Loan
Commitment; and

(b) each Revolving Facility Lender agrees to make Revolving Facility Loans to
the Borrower from time to time during the Availability Period in an aggregate
principal amount that will not result in (i) such Revolving Facility Lender’s
Revolving Facility Credit Exposure exceeding such Revolving Facility Lender’s
Revolving Facility Commitment or (ii) the total Revolving Facility Credit
Exposure exceeding the total Revolving Facility Commitments; provided that there
shall be no Revolving Facility Loans made on the Closing Date. Within the
foregoing limits and subject to the terms and conditions set forth herein, the
Borrower may borrow, prepay and reborrow Revolving Facility Loans.

SECTION 2.02. Loans and Borrowings.

(a) Each Loan shall be made as part of a Borrowing consisting of Loans under the
same Facility and of the same Type made by the Lenders ratably in accordance
with their respective Commitments under the applicable Facility (or, in the case
of Swingline Loans, in accordance with their respective Swingline Commitments);
provided, however, that Revolving Facility Loans shall be made by the Revolving
Facility Lenders ratably in accordance with their respective Revolving Facility
Percentages on the date such Loans are made hereunder. The failure of any Lender
to make any Loan required to be made by it shall not relieve any other Lender of
its obligations hereunder; provided that the Commitments of the Lenders are
several and no Lender shall be responsible for any other Lender’s failure to
make Loans as required.

(b) Subject to Section 2.14, each Borrowing (other than a Swingline Borrowing)
shall be comprised entirely of ABR Loans or Eurocurrency Loans as the Borrower
may request in accordance herewith. Each Swingline Borrowing shall be an ABR
Borrowing. Each Lender at its option may make any ABR Loan or Eurocurrency Loan
by causing any domestic or foreign branch or Affiliate of such Lender to make
such Loan; provided that any exercise of such option shall not affect the
obligation of the Borrower to repay such Loan in accordance with the terms of
this Agreement and such Lender shall not be entitled to any amounts payable
under Section 2.15 or 2.17 solely in respect of increased costs resulting from
such exercise and existing at the time of such exercise.

(c) At the commencement of each Interest Period for any Eurocurrency Revolving
Borrowing, such Borrowing shall be in an aggregate amount that is an integral
multiple of the Borrowing Multiple and not less than the Borrowing Minimum. At
the time that each ABR Revolving Borrowing is

 

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made, such Borrowing shall be in an aggregate amount that is an integral
multiple of the Borrowing Multiple and not less than the Borrowing Minimum;
provided that an ABR Revolving Borrowing may be in an aggregate amount that is
equal to the entire unused balance of the Revolving Facility Commitments or that
is required to finance the reimbursement of an L/C Disbursement as contemplated
by Section 2.05(e). Each Swingline Borrowing shall be in an amount that is an
integral multiple of the Borrowing Multiple and not less than the Borrowing
Minimum. Borrowings of more than one Type and under more than one Facility may
be outstanding at the same time; provided that there shall not at any time be
more than a total of (i) 5 Eurocurrency Borrowings outstanding under the Term
Facility and (ii) 5 Eurocurrency Borrowings outstanding under the Revolving
Facility.

(d) Notwithstanding any other provision of this Agreement, the Borrower shall
not be entitled to request, or to elect to convert or continue, any Borrowing if
the Interest Period requested with respect thereto would end after the Revolving
Facility Maturity Date or the Term Facility Maturity Date, as applicable.

SECTION 2.03. Requests for Borrowings. To request a Revolving Borrowing and/or a
Term Borrowing, the Borrower shall notify the Administrative Agent of such
request by telephone (a) in the case of a Eurocurrency Borrowing, not later than
11:00 a.m., Local Time, three Business Days before the date of the proposed
Borrowing or (b) in the case of an ABR Borrowing, not later than 12:00 noon,
Local Time, one Business Day before the date of the proposed Borrowing; provided
that any such notice of an ABR Revolving Borrowing to finance the reimbursement
of an L/C Disbursement as contemplated by Section 2.05(e) may be given not later
than 10:00 a.m., Local Time, on the date of the proposed Borrowing. Each such
telephonic Borrowing Request shall be irrevocable and shall be confirmed
promptly by hand delivery or telecopy to the Administrative Agent of a written
Borrowing Request in a form approved by the Administrative Agent and signed by
the Borrower. Each such telephonic and written Borrowing Request shall specify
the following information in compliance with Section 2.02:

(i) the aggregate amount of the requested Borrowing;

(ii) the date of such Borrowing, which shall be a Business Day;

(iii) whether such Borrowing is to be an ABR Borrowing or a Eurocurrency
Borrowing;

(iv) in the case of a Eurocurrency Borrowing, the initial Interest Period to be
applicable thereto, which shall be a period contemplated by the definition of
the term “Interest Period”; and

(v) the location and number of the Borrower’s account to which funds are to be
disbursed.

If no election as to the Type of Revolving Borrowing is specified, then the
requested Revolving Borrowing shall be an ABR Borrowing. If no Interest Period
is specified with respect to any requested Eurocurrency Borrowing, then the
Borrower shall be deemed to have selected an Interest Period of one month’s
duration. Promptly following receipt of a Borrowing Request in accordance with
this Section 2.03, the Administrative Agent shall advise each Lender of the
details thereof and of the amount of such Lender’s Loan to be made as part of
the requested Borrowing.

 

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SECTION 2.04. Swingline Loans.

(a) Subject to the terms and conditions set forth herein, the Swingline Lender
agrees to make Swingline Loans to the Borrower from time to time during the
Availability Period in an aggregate principal amount at any time outstanding
that will not result in (i) the aggregate principal amount of outstanding
Swingline Loans exceeding the Swingline Commitment or (ii) the total Revolving
Facility Credit Exposure exceeding the total Revolving Facility Commitments;
provided that the Swingline Lender shall not be required to make a Swingline
Loan to refinance an outstanding Swingline Borrowing. Within the foregoing
limits and subject to the terms and conditions set forth herein, the Borrower
may borrow, prepay and reborrow Swingline Loans.

(b) To request a Swingline Borrowing, the Borrower shall notify the
Administrative Agent and the Swingline Lender of such request by telephone
(confirmed promptly by a Swingline Borrowing Request by telecopy), not later
than 11:00 a.m., Local Time, on the day of a proposed Swingline Borrowing. Each
such notice and Swingline Borrowing Request shall be irrevocable and shall
specify (i) the requested date (which shall be a Business Day), (ii) the amount
of the requested Swingline Borrowing and (iii) the location and number of the
Borrower’s account to which funds comprising the requested Swingline Borrowing
are to be disbursed. The Swingline Lender shall notify the Administrative Agent
as to the making of the Swingline Loan prior to the Swingline Lender funding
such Swingline Loan. The Swingline Lender shall make each Swingline Loan in
accordance with Section 2.02(a) on the proposed date thereof by wire transfer of
immediately available funds by 3:00 p.m., Local Time, to the account of the
Borrower (or, in the case of a Swingline Borrowing made to finance the
reimbursement of an L/C Disbursement as provided in Section 2.05(e), by
remittance to the applicable Issuing Bank).

(c) The Swingline Lender may by written notice given to the Administrative Agent
not later than 10:00 a.m., Local Time, on any Business Day require the Revolving
Facility Lenders to acquire participations on such Business Day in all or a
portion of the outstanding Swingline Loans made by it. Such notice shall specify
the aggregate amount of such Swingline Loans in which the Revolving Facility
Lenders will participate. Promptly upon receipt of such notice, the
Administrative Agent will give notice thereof to each such Lender, specifying in
such notice such Revolving Facility Lender’s Revolving Facility Percentage of
such Swingline Loan or Loans. Each Revolving Facility Lender hereby absolutely
and unconditionally agrees, upon receipt of notice as provided above, to pay to
the Administrative Agent for the account of the Swingline Lender, such Revolving
Facility Lender’s Revolving Facility Percentage of such Swingline Loan or Loans.
Each Revolving Facility Lender acknowledges and agrees that its obligation to
acquire participations in Swingline Loans pursuant to this paragraph is absolute
and unconditional and shall not be affected by any circumstance whatsoever,
including the occurrence and continuance of a Default or reduction or
termination of the Commitments, and that each such payment shall be made without
any offset, abatement, withholding or reduction whatsoever. Each Revolving
Facility Lender shall comply with its obligation under this paragraph by wire
transfer of immediately available funds, in the same manner as provided in
Section 2.06 with respect to Loans made by such Revolving Facility Lender (and
Section 2.06 shall apply, mutatis mutandis, to the payment obligations of the
Lenders), and the Administrative Agent shall promptly pay to the Swingline
Lender the amounts so received by it from the Revolving Facility Lenders. The
Administrative Agent shall notify the Borrower of any participations in any
Swingline Loan acquired pursuant to this paragraph, and thereafter payments in
respect of such Swingline Loan shall be made to the Administrative Agent and not
to the Swingline Lender. Any amounts received by the Swingline Lender from the
Borrower (or other party on behalf of the Borrower) in respect of a Swingline
Loan after receipt by the Swingline Lender of the proceeds of a sale of
participations therein shall be promptly remitted to the Administrative Agent;
any such amounts received by the Administrative Agent shall be promptly remitted
by the Administrative Agent to the Revolving Facility Lenders that shall have
made their payments pursuant to this paragraph and to the Swingline Lender, as
their interests may appear; provided that any such payment so remitted shall be
repaid to the Swingline Lender or to the Administrative Agent, as applicable, if
and to the extent such payment is required to be refunded to the Borrower for
any reason. The purchase of participations in a Swingline Loan pursuant to this
paragraph shall not relieve the Borrower of any default in the payment thereof.

 

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SECTION 2.05. Letters of Credit.

(a) General. In addition, subject to the terms and conditions set forth herein,
the Borrower may request the issuance of Letters of Credit in Dollars, for its
own account or the account of a Subsidiary in a form reasonably acceptable to
the applicable Issuing Bank, at any time and from time to time during the
Availability Period and prior to the date that is five Business Days prior to
the Revolving Facility Maturity Date; provided that the Borrower shall be a
co-applicant, and be jointly and severally liable, with respect to each Letter
of Credit issued for the account of a Subsidiary. In the event of any
inconsistency between the terms and conditions of this Agreement and the terms
and conditions of any form of letter of credit application or other agreement
submitted by the Borrower to, or entered into by the Borrower with, an Issuing
Bank relating to any Letter of Credit, the terms and conditions of this
Agreement shall control.

(b) Notice of Issuance, Amendment, Renewal, Extension; Certain Conditions. To
request the issuance of a Letter of Credit (or the amendment, renewal (other
than an automatic renewal in accordance with paragraph (c) of this Section) or
extension of an outstanding Letter of Credit), the Borrower shall hand deliver
or telecopy (or transmit by electronic communication, if arrangements for doing
so have been approved by the applicable Issuing Bank) to the applicable Issuing
Bank and the Administrative Agent (three Business Days in advance of the
requested date of issuance, amendment, renewal or extension) a notice requesting
the issuance of a Letter of Credit, or identifying the Letter of Credit to be
amended, renewed or extended, and specifying the date of issuance, amendment,
renewal or extension (which shall be a Business Day), the date on which such
Letter of Credit is to expire (which shall comply with paragraph (c) of this
Section), the amount of such Letter of Credit, whether the Letter of Credit is
to be issued for its own account or for the account of a Subsidiary (provided
that the Borrower shall be a co-applicant, and therefore jointly and severally
liable, with respect to each Letter of Credit issued for the account of a
Subsidiary), the name and address of the beneficiary thereof and such other
information as shall be necessary to issue, amend, renew or extend such Letter
of Credit. If requested by the applicable Issuing Bank, the Borrower also shall
submit a letter of credit application on such Issuing Bank’s standard form in
connection with any request for a Letter of Credit. A Letter of Credit shall be
issued, amended, renewed or extended only if (and upon issuance, amendment,
renewal or extension of each Letter of Credit the Borrower shall be deemed to
represent and warrant that), after giving effect to such issuance, amendment,
renewal or extension (i) the Revolving L/C Exposure shall not exceed the total
L/C Commitment and (ii) the total Revolving Facility Credit Exposure shall not
exceed the total Revolving Facility Commitments.

(c) Expiration Date.

(i) Each Letter of Credit shall expire at or prior to the close of business on
the earlier of (i) the date one year after the date of the issuance of such
Letter of Credit (or, in the case of any renewal or extension thereof, one year
after such renewal or extension) and (ii) the date that is five Business Days
prior to the Revolving Facility Maturity Date; provided that any Letter of
Credit with a one-year tenor may provide for the automatic renewal thereof for
additional one-year periods (which, in no event, shall extend beyond the date
referred to in clause (ii) of this paragraph (c) unless otherwise agreed by the
Issuing Bank and the Administrative Agent).

(ii) If Borrower so requests in any Letter of Credit Request, the Issuing Bank
may, in its sole and absolute discretion, agree to issue a Letter of Credit that
has automatic renewal provisions (each, an “Auto-Renewal Letter of Credit”);
provided that any such Auto-Renewal Letter of Credit must

 

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permit the Issuing Bank to prevent any such renewal at least once in each
twelve-month period (commencing with the date of issuance of such Letter of
Credit) by giving prior notice to the Borrower and to the beneficiary thereof
not later than a date in each such twelve-month period to be agreed upon at the
time such Letter of Credit is issued and to be set forth therein. Unless
otherwise directed by the Issuing Bank, Borrower shall not be required to make a
specific request to the Issuing Bank for any such renewal. Once an Auto-Renewal
Letter of Credit has been issued, the Revolving Lenders shall be deemed to have
authorized (but may not require) the Issuing Bank to permit the renewal of such
Letter of Credit at any time to an expiry date not later than the earlier of
(i) one year from the date of such renewal and (ii) the date that the Letter of
Credit expires; provided that the Issuing Bank shall not permit any such renewal
if (x) the Issuing Bank has determined that it would have no obligation at such
time to issue such Letter of Credit in its renewed form under the terms hereof,
or (y) it has received notice on or before the day that is two Business Days
before the date which has been agreed upon pursuant to the proviso of the first
sentence of this paragraph, (1) from the Administrative Agent that any Revolving
Lender directly affected thereby has elected not to permit such renewal or
(2) from the Administrative Agent, any Lender or Borrower that one or more of
the applicable conditions specified in Section 4.01 are not then satisfied;
provided, further, that the Issuing Bank or Administrative Agent may require any
such letter of credit to permit cancellation of such automatic renewal provision
upon at least 90 days’ prior written notice.

(d) Participations. By the issuance of a Letter of Credit (or an amendment to a
Letter of Credit increasing the amount thereof) and without any further action
on the part of the applicable Issuing Bank or the Revolving Facility Lenders,
such Issuing Bank hereby grants to each Revolving Facility Lender, and each
Revolving Facility Lender hereby acquires from such Issuing Bank, a
participation in such Letter of Credit equal to such Revolving Facility Lender’s
Revolving Facility Percentage of the aggregate amount available to be drawn
under such Letter of Credit. In consideration and in furtherance of the
foregoing, each Revolving Facility Lender hereby absolutely and unconditionally
agrees to pay to the Administrative Agent, for the account of the applicable
Issuing Bank, such Revolving Facility Lender’s Revolving Facility Percentage of
each L/C Disbursement made by such Issuing Bank and not reimbursed by the
Borrower on the date due as provided in paragraph (e) of this Section, or of any
reimbursement payment required to be refunded to the Borrower for any reason.
Each Revolving Facility Lender acknowledges and agrees that its obligation to
acquire participations pursuant to this paragraph in respect of Letters of
Credit is absolute and unconditional and shall not be affected by any
circumstance whatsoever, including any amendment, renewal or extension of any
Letter of Credit or the occurrence and continuance of a Default or reduction or
termination of the Commitments, and that each such payment shall be made without
any offset, abatement, withholding or reduction whatsoever.

(e) Reimbursement. If the applicable Issuing Bank shall make any L/C
Disbursement in respect of a Letter of Credit, the Borrower shall reimburse such
L/C Disbursement by paying to the Administrative Agent an amount equal to such
L/C Disbursement in Dollars not later than 2:00 p.m., Local Time, on (i) the
Business Day that the Borrower receives notice under paragraph (g) of this
Section of such L/C Disbursement, if such notice is received on such day prior
to 12:00 noon, Local Time, or (ii) if clause (i) does not apply, the Business
Day immediately following the date the Borrower receives such notice; provided
that the Borrower may, subject to the conditions to borrowing set forth herein,
request in accordance with Section 2.03 or 2.04 that such payment be financed
with an ABR Revolving Borrowing, in an equivalent amount and, to the extent so
financed, the Borrower’s obligation to make such payment shall be discharged and
replaced by the resulting ABR Revolving Borrowing. If the Borrower fails to
reimburse any L/C Disbursement when due, then the Administrative Agent shall
promptly notify the applicable Issuing Bank and each other Revolving Facility
Lender of the applicable L/C Disbursement, the payment then due from the
Borrower in respect thereof and, in the case of a Revolving Facility Lender,
such Lender’s Revolving Facility Percentage thereof. Promptly following receipt
of such notice, each Revolving Facility Lender shall pay to the Administrative
Agent its Revolving Facility Percentage of the

 

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payment then due from the Borrower in the same manner as provided in
Section 2.06 with respect to Loans made by such Lender (and Section 2.06 shall
apply, mutatis mutandis, to the payment obligations of the Revolving Facility
Lenders), and the Administrative Agent shall promptly pay to the applicable
Issuing Bank the amounts so received by it from the Revolving Facility Lenders.
Promptly following receipt by the Administrative Agent of any payment from the
Borrower pursuant to this paragraph, the Administrative Agent shall distribute
such payment to the applicable Issuing Bank or, to the extent that Revolving
Facility Lenders have made payments pursuant to this paragraph to reimburse such
Issuing Bank, then to such Lenders and such Issuing Bank as their interests may
appear. Any payment made by a Revolving Facility Lender pursuant to this
paragraph to reimburse an Issuing Bank for any L/C Disbursement (other than the
funding of an ABR Revolving Loan or a Swingline Borrowing as contemplated above)
shall not constitute a Loan and shall not relieve the Borrower of its obligation
to reimburse such L/C Disbursement.

(f) Obligations Absolute. The obligation of the Borrower to reimburse L/C
Disbursements as provided in paragraph (e) of this Section shall be absolute,
unconditional and irrevocable, and shall be performed strictly in accordance
with the terms of this Agreement under any and all circumstances whatsoever and
irrespective of (i) any lack of validity or enforceability of any Letter of
Credit or this Agreement, or any term or provision therein, (ii) any draft or
other document presented under a Letter of Credit proving to be forged,
fraudulent or invalid in any respect or any statement therein being untrue or
inaccurate in any respect, (iii) payment by the applicable Issuing Bank under a
Letter of Credit against presentation of a draft or other document that does not
comply with the terms of such Letter of Credit or (iv) any other event or
circumstance whatsoever, whether or not similar to any of the foregoing, that
might, but for the provisions of this Section, constitute a legal or equitable
discharge of, or provide a right of setoff against, the Borrower’s obligations
hereunder. Neither the Administrative Agent, the Lenders nor any Issuing Bank,
nor any of their Related Parties, shall have any liability or responsibility by
reason of or in connection with the issuance or transfer of any Letter of Credit
or any payment or failure to make any payment thereunder (irrespective of any of
the circumstances referred to in the preceding sentence), or any error,
omission, interruption, loss or delay in transmission or delivery of any draft,
notice or other communication under or relating to any Letter of Credit
(including any document required to make a drawing thereunder), any error in
interpretation of technical terms or any consequence arising from causes beyond
the control of such Issuing Bank, or any of the circumstances referred to in
clause (i), (ii) or (iii) of the first sentence; provided that the foregoing
shall not be construed to excuse the applicable Issuing Bank from liability to
the Borrower to the extent of any direct damages (as opposed to consequential or
punitive damages, claims in respect of which are hereby waived by the Borrower
to the extent permitted by applicable law) suffered by the Borrower that are
determined by a court of competent jurisdiction to have been caused by (i) such
Issuing Bank’s failure to exercise care when determining whether drafts and
other documents presented under a Letter of Credit comply with the terms thereof
or (ii) such Issuing Bank’s failure to exercise care when refusing to issue a
Letter of Credit in accordance with the terms of this Agreement. The parties
hereto expressly agree that, in the absence of gross negligence or willful
misconduct on the part of the applicable Issuing Bank, such Issuing Bank shall
be deemed to have exercised care in each such determination and each refusal to
issue a Letter of Credit. In furtherance of the foregoing and without limiting
the generality thereof, the parties agree that, with respect to documents
presented which appear on their face to be in substantial compliance with the
terms of a Letter of Credit, the applicable Issuing Bank may, in its sole
discretion, either accept and make payment upon such documents without
responsibility for further investigation, regardless of any notice or
information to the contrary, or refuse to accept and make payment upon such
documents if such documents are not in strict compliance with the terms of such
Letter of Credit.

(g) Disbursement Procedures. The applicable Issuing Bank shall, promptly
following its receipt thereof, examine all documents purporting to represent a
demand for payment under a Letter

 

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of Credit. Such Issuing Bank shall promptly notify the Administrative Agent and
the Borrower by telephone (confirmed by telecopy) of such demand for payment and
whether such Issuing Bank has made or will make a L/C Disbursement thereunder;
provided that any failure to give or delay in giving such notice shall not
relieve the Borrower of its obligation to reimburse such Issuing Bank and the
Revolving Facility Lenders with respect to any such L/C Disbursement.

(h) Interim Interest. If an Issuing Bank shall make any L/C Disbursement, then,
unless the Borrower shall reimburse such L/C Disbursement in full on the date
such L/C Disbursement is made, the unpaid amount thereof shall bear interest,
for each day from and including the date such L/C Disbursement is made to but
excluding the date that the Borrower reimburses such L/C Disbursement, at the
rate per annum then applicable to ABR Revolving Loans; provided that, if such
L/C Disbursement is not reimbursed by the Borrower when due pursuant to
paragraph (e) of this Section, then Section 2.13(c) shall apply. Interest
accrued pursuant to this paragraph shall be for the account of the applicable
Issuing Bank, except that interest accrued on and after the date of payment by
any Revolving Facility Lender pursuant to paragraph (e) of this Section to
reimburse such Issuing Bank shall be for the account of such Revolving Facility
Lender to the extent of such payment.

(i) Replacement of an Issuing Bank. An Issuing Bank may be replaced at any time
by written agreement among the Borrower, the Administrative Agent, the replaced
Issuing Bank and the successor Issuing Bank. The Administrative Agent shall
notify the Lenders of any such replacement of an Issuing Bank. At the time any
such replacement shall become effective, the Borrower shall pay all unpaid fees
accrued for the account of the replaced Issuing Bank pursuant to Section 2.12.
From and after the effective date of any such replacement, (i) the successor
Issuing Bank shall have all the rights and obligations of the replaced Issuing
Bank under this Agreement with respect to Letters of Credit to be issued
thereafter and (ii) references herein to the term “Issuing Bank” shall be deemed
to refer to such successor or to any previous Issuing Bank, or to such successor
and all previous Issuing Banks, as the context shall require. After the
replacement of an Issuing Bank hereunder, the replaced Issuing Bank shall remain
a party hereto and shall continue to have all the rights and obligations of such
Issuing Bank under this Agreement with respect to Letters of Credit issued by it
prior to such replacement but shall not be required to issue additional Letters
of Credit.

(j) Cash Collateralization. If any Event of Default shall occur and be
continuing, (i) in the case of an Event of Default described in Section 7.01(h)
or (i), on the Business Day or (ii) in the case of any other Event of Default
(subject to Section 7.01), on the third Business Day, in each case, following
the date on which the Borrower receives notice from the Administrative Agent
(or, if the maturity of the Loans has been accelerated, Revolving Facility
Lenders with Revolving L/C Exposure representing greater than 50% of the total
Revolving L/C Exposure) demanding the deposit of cash collateral pursuant to
this paragraph, the Borrower shall deposit in an account with the Administrative
Agent, in the name of the Administrative Agent and for the benefit of the
Lenders, an amount in cash equal to the Revolving L/C Exposure as of such date
plus any accrued and unpaid interest thereon; provided that upon the occurrence
of any Event of Default with respect to the Borrower described in clause (h) or
(i) of Section 7.01, the obligation to deposit such cash collateral shall become
effective immediately, and such deposit shall become immediately due and
payable, without demand or other notice of any kind. Each such deposit pursuant
to this paragraph shall be held by the Administrative Agent as collateral for
the payment and performance of the obligations of the Borrower under this
Agreement. The Administrative Agent shall have exclusive dominion and control,
including the exclusive right of withdrawal, over such account. Other than any
interest earned on the investment of such deposits, which investments shall be
made at the option and sole discretion of (i) for so long as an Event of Default
shall be continuing, the Administrative Agent and (ii) at any other time, the
Borrower, in each case, in Permitted Investments and at the risk and expense of
the Borrower, such deposits shall not bear interest. Interest or profits, if
any, on such investments

 

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shall accumulate in such account. Moneys in such account shall be applied by the
Administrative Agent to reimburse each Issuing Bank for L/C Disbursements for
which such Issuing Bank has not been reimbursed and, to the extent not so
applied, shall be held for the satisfaction of the reimbursement obligations of
the Borrower for the Revolving L/C Exposure at such time or, if the maturity of
the Loans has been accelerated (but subject to the consent of Revolving Facility
Lenders with Revolving L/C Exposure representing greater than 50% of the total
Revolving L/C Exposure), be applied to satisfy other obligations of the Borrower
under this Agreement. If the Borrower is required to provide an amount of cash
collateral hereunder as a result of the occurrence of an Event of Default, such
amount (to the extent not applied as aforesaid) shall be returned to the
Borrower within three Business Days after all Events of Default have been cured
or waived.

(k) Additional Issuing Banks. From time to time, the Borrower may by notice to
the Administrative Agent designate up to three Lenders (in addition to Citibank,
N.A.) each of which agrees (in its sole discretion) to act in such capacity and
is reasonably satisfactory to the Administrative Agent as an Issuing Bank. Each
such additional Issuing Bank shall execute a counterpart of this Agreement upon
the approval of the Administrative Agent (which approval shall not be
unreasonably withheld) and shall thereafter be an Issuing Bank hereunder for all
purposes.

(l) Reporting. Unless otherwise requested by the Administrative Agent, each
Issuing Bank shall (i) provide to the Administrative Agent copies of any notice
received from the Borrower pursuant to Section 2.05(b) no later than the next
Business Day after receipt thereof and (ii) report in writing to the
Administrative Agent (A) on or prior to each Business Day on which such Issuing
Bank expects to issue, amend, renew or extend any Letter of Credit, the date of
such issuance, amendment, renewal or extension, and the aggregate face amount of
the Letters of Credit to be issued, amended, renewed or extended by it and
outstanding after giving effect to such issuance, amendment, renewal or
extension occurred (and whether the amount thereof changed), and the Issuing
Bank shall be permitted to issue, amend, renew or extend such Letter of Credit
if the Administrative Agent shall not have advised the Issuing Bank that such
issuance, amendment renewal or extension would not be in conformity with the
requirements of this Agreement, (B) on each Business Day on which such Issuing
Bank makes any L/C Disbursement, the date of such L/C Disbursement and the
amount of such L/C Disbursement and (C) on any other Business Day, such other
information as the Administrative Agent shall reasonably request, including but
not limited to prompt verification of such information as may be requested by
the Administrative Agent.

SECTION 2.06. Funding of Borrowings.

(a) Each Lender shall make each Loan to be made by it hereunder on the proposed
date thereof by wire transfer of immediately available funds by 12:00 noon,
Local Time, to the account of the Administrative Agent most recently designated
by it for such purpose by notice to the Lenders; provided that Swingline Loans
shall be made as provided in Section 2.04. The Administrative Agent will make
such Loans available to the Borrower by promptly crediting the amounts so
received, in like funds, to an account of the Borrower maintained with the
Administrative Agent in New York City; provided that ABR Revolving Loans and
Swingline Borrowings made to finance the reimbursement of a L/C Disbursement and
reimbursements as provided in Section 2.05(e) shall be remitted by the
Administrative Agent to the applicable Issuing Bank.

(b) Unless the Administrative Agent shall have received notice from a Lender
prior to the proposed date of any Borrowing that such Lender will not make
available to the Administrative Agent such Lender’s share of such Borrowing, the
Administrative Agent may assume that such Lender has made such share available
on such date in accordance with paragraph (a) of this Section and may, in

 

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reliance upon such assumption, make available to the Borrower a corresponding
amount. In such event, if a Lender has not in fact made its share of the
applicable Borrowing available to the Administrative Agent, then the applicable
Lender and the Borrower severally agree to pay to the Administrative Agent
forthwith on demand (without duplication) such corresponding amount with
interest thereon, for each day from and including the date such amount is made
available to the Borrower to but excluding the date of payment to the
Administrative Agent, at (i) in the case of such Lender, the Federal Funds
Effective Rate and a rate determined by the Administrative Agent in accordance
with banking industry rules on interbank compensation or (ii) in the case of the
Borrower, the interest rate applicable to ABR Loans. If such Lender pays such
amount to the Administrative Agent, then such amount shall constitute such
Lender’s Loan included in such Borrowing.

SECTION 2.07. Interest Elections.

(a) Each Borrowing initially shall be of the Type specified in the applicable
Borrowing Request and, in the case of a Eurocurrency Borrowing, shall have an
initial Interest Period as specified in such Borrowing Request. Thereafter, the
Borrower may elect to convert such Borrowing to a different Type or to continue
such Borrowing and, in the case of a Eurocurrency Borrowing, may elect Interest
Periods therefor, all as provided in this Section. The Borrower may elect
different options with respect to different portions of the affected Borrowing,
in which case each such portion shall be allocated ratably among the Lenders
holding the Loans comprising such Borrowing, and the Loans comprising each such
portion shall be considered a separate Borrowing. This Section shall not apply
to Swingline Borrowings, which may not be converted or continued.

(b) To make an election pursuant to this Section, the Borrower shall notify the
Administrative Agent of such election by telephone by the time that a Borrowing
Request would be required under Section 2.03 if the Borrower were requesting a
Borrowing of the Type resulting from such election to be made on the effective
date of such election. Each such telephonic Interest Election Request shall be
irrevocable and shall be confirmed promptly (but in any event on the same
Business Day) by hand delivery or telecopy to the Administrative Agent of a
written Interest Election Request in a form approved by the Administrative Agent
and signed by such Borrower.

(c) Each telephonic and written Interest Election Request shall specify the
following information in compliance with Section 2.02:

(i) the Borrowing to which such Interest Election Request applies and, if
different options are being elected with respect to different portions thereof,
the portions thereof to be allocated to each resulting Borrowing (in which case
the information to be specified pursuant to clauses (iii) and (iv) below shall
be specified for each resulting Borrowing);

(ii) the effective date of the election made pursuant to such Interest Election
Request, which shall be a Business Day;

(iii) whether the resulting Borrowing is to be an ABR Borrowing or a
Eurocurrency Borrowing; and

(iv) if the resulting Borrowing is a Eurocurrency Borrowing, the Interest Period
to be applicable thereto after giving effect to such election, which shall be a
period contemplated by clause (a) of the definition of the term “Interest
Period.”

If any such Interest Election Request requests a Eurocurrency Borrowing but does
not specify an Interest Period, then the Borrower shall be deemed to have
selected an Interest Period of one month’s duration.

 

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(d) Promptly following receipt of an Interest Election Request, the
Administrative Agent shall advise each Lender to which such Interest Election
Request relates of the details thereof and of such Lender’s portion of each
resulting Borrowing.

(e) If the Borrower fails to deliver a timely Interest Election Request with
respect to a Eurocurrency Borrowing prior to the end of the Interest Period
applicable thereto, then, unless such Borrowing is repaid as provided herein, at
the end of such Interest Period such Borrowing shall be converted to an ABR
Borrowing. Notwithstanding any contrary provision hereof, if an Event of Default
has occurred and is continuing and the Administrative Agent, at the written
request (including a request through electronic means) of the Required Lenders,
so notifies the Borrower, then, so long as an Event of Default is continuing
(i) no outstanding Borrowing may be converted to or continued as a Eurocurrency
Borrowing and (ii) unless repaid, each Eurocurrency Borrowing shall be converted
to an ABR Borrowing at the end of the Interest Period applicable thereto.

SECTION 2.08. Termination and Reduction of Commitments.

(a) Unless previously terminated, the Revolving Facility Commitments shall
terminate on the Revolving Facility Maturity Date. The parties hereto
acknowledge that the Term Loan Commitments will terminate at 5:00 p.m., Local
Time, on the Closing Date.

(b) The Borrower may at any time terminate, or from time to time reduce, the
Commitments under either Facility; provided that (i) each reduction of the
Commitments under either Facility shall be in an amount that is an integral
multiple of $1 million and not less than $5 million (or, if less, the remaining
amount of the Revolving Facility Commitments) and (ii) the Borrower shall not
terminate or reduce the Revolving Facility Commitments if, after giving effect
to any concurrent prepayment of the Revolving Facility Loans in accordance with
Section 2.11, the Revolving Facility Credit Exposure would exceed the total
Revolving Facility Commitments.

(c) The Borrower shall notify the Administrative Agent of any election to
terminate or reduce the Revolving Facility Commitments under paragraph (b) of
this Section at least three Business Days prior to the effective date of such
termination or reduction, specifying such election and the effective date
thereof. Promptly following receipt of any notice, the Administrative Agent
shall advise the applicable Lenders of the contents thereof. Each notice
delivered by the Borrower pursuant to this Section shall be irrevocable;
provided that a notice of termination of the Revolving Facility Commitments
delivered by the Borrower may state that such notice is conditioned upon the
effectiveness of other credit facilities, in which case such notice may be
revoked by the Borrower (by notice to the Administrative Agent on or prior to
the specified effective date) if such condition is not satisfied. Any
termination or reduction of the Commitments shall be permanent. Each reduction
of the Commitments under either Facility shall be made ratably among the Lenders
in accordance with their respective Commitments under such Facility.

SECTION 2.09. Repayment of Loans; Evidence of Debt.

(a) The Borrower hereby unconditionally promises to pay (i) to the
Administrative Agent for the account of each Revolving Facility Lender the then
unpaid principal amount of each Revolving Facility Loan to the Borrower on the
Revolving Facility Maturity Date, (ii) to the Administrative Agent for the
account of each Lender the then unpaid principal amount of each Term Loan of
such Lender as provided in Section 2.10 and (iii) to the Swingline Lender the
then unpaid principal amount of each Swingline Loan on the earlier of the
Revolving Facility Maturity Date and the first date after such Swingline Loan is
made that is the 15th or last day of a calendar month and is at least five
Business Days after such Swingline Loan is made; provided that on each date that
a Revolving Facility Borrowing is made by the Borrower, the Borrower shall repay
all Swingline Loans then outstanding. Once prepaid or repaid, Term Loans may not
be reborrowed.

 

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(b) Each Lender shall maintain in accordance with its usual practice an account
or accounts evidencing the indebtedness of the Borrower to such Lender resulting
from each Loan made by such Lender, including the amounts of principal and
interest payable and paid to such Lender from time to time hereunder.

(c) The Administrative Agent shall maintain accounts in which it shall record
(i) the amount of each Loan made hereunder, the Facility and Type thereof and
the Interest Period (if any) applicable thereto, (ii) the amount of any
principal or interest due and payable or to become due and payable from the
Borrower to each Lender hereunder and (iii) any amount received by the
Administrative Agent hereunder for the account of the Lenders and each Lender’s
share thereof.

(d) The entries made in the accounts maintained pursuant to paragraph (b) or
(c) of this Section shall be prima facie evidence of the existence and amounts
of the obligations recorded therein; provided that the failure of any Lender or
the Administrative Agent to maintain such accounts or any error therein shall
not in any manner affect the obligation of the Borrower to repay the Loans in
accordance with the terms of this Agreement.

(e) Any Lender may request that Loans made by it be evidenced by a promissory
note (a “Note”). In such event, the Borrower shall prepare, execute and deliver
to such Lender a promissory note payable to the order of such Lender (or, if
requested by such Lender, to such Lender and its registered assigns) and in a
form approved by the Administrative Agent. Thereafter, the Loans evidenced by
such promissory note and interest thereon shall at all times (including after
assignment pursuant to Section 9.04) be represented by one or more promissory
notes in such form payable to the order of the payee named therein (or, if such
promissory note is a registered note, to such payee and its registered assigns).

SECTION 2.10. Repayment of Term Loans and Revolving Facility Loans.

(a) Subject to the other paragraphs of this Section, the Borrower shall repay
Term Borrowings on each date set forth below in the aggregate principal amount
set forth below opposite such date or, if such date is not a Business Day, the
immediately preceding Business Day (each such date being referred to as a “Term
Loan Installment Date”):

 

Date

   Amount of Term
Borrowings to be Repaid

December 31, 2006

   $ 225,000

March 31, 2007

   $ 225,000

June 30, 2007

   $ 225,000

September 30, 2007

   $ 225,000

December 31, 2007

   $ 225,000

March 31, 2008

   $ 225,000

June 30, 2008

   $ 225,000

September 30, 2008

   $ 225,000

December 31, 2008

   $ 225,000

March 31, 2009

   $ 225,000

June 30, 2009

   $ 225,000

September 30, 2009

   $ 225,000

December 31, 2009

   $ 225,000

 

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Date

   Amount of Term
Borrowings to be Repaid

March 31, 2010

   $ 225,000

June 30, 2010

   $ 225,000

September 30, 2010

   $ 225,000

December 31, 2010

   $ 225,000

March 31, 2011

   $ 225,000

June 30, 2011

   $ 225,000

September 30, 2011

   $ 225,000

December 31, 2011

   $ 225,000

March 31, 2012

   $ 225,000

June 30, 2012

   $ 225,000

September 30, 2012

   $ 225,000

December 31, 2012

   $ 225,000

March 31, 2013

   $ 225,000

June 30, 2013

   $ 225,000

Term Facility Maturity Date

   $ 83,925,000

(b) To the extent not previously paid, outstanding Revolving Facility Loans
shall be due and payable on the Revolving Facility Maturity Date.

(c) Prepayment of the Borrowings from:

(i) all Net Proceeds and Excess Cash Flow pursuant to Section 2.11(b) or 2.11(c)
shall be applied to the Term Borrowings, with the application thereof in direct
chronological order to the unpaid amounts due on the next succeeding Term Loan
Installment Dates, and

(ii) any optional prepayments of the Term Loans pursuant to Section 2.11(a)
shall be applied to the remaining installments thereof as directed by the
Borrower.

(d) Prior to any repayment of any Borrowing under either Facility hereunder, the
Borrower shall select the Borrowing or Borrowings under the applicable Facility
to be repaid and shall notify the Administrative Agent by telephone (confirmed
by telecopy) of such selection not later than 2:00 p.m., Local Time, (i) in the
case of an ABR Borrowing, one Business Day before the scheduled date of such
repayment and (ii) in the case of a Eurocurrency Borrowing, three Business Days
before the scheduled date of such repayment. Each repayment of a Borrowing
(x) in the case of the Revolving Facility, shall be applied to the Revolving
Facility Loans included in the repaid Borrowing such that each Revolving
Facility Lender receives its ratable share of such repayment (based upon the
Revolving Facility Credit Exposures of the Revolving Facility Lenders at the
time of such repayment) and (y) in all other cases, shall be applied ratably to
the Loans included in the repaid Borrowing; provided that for prepayments made
pursuant to Sections 2.11(b) or 2.11(c), each Term Loan Lender may elect, by
written notice to the Administrative Agent at least one Business Day prior to
the prepayment date, to decline its pro rata share of such Term Loan repayment;
in which case the amount so declined shall be offered ratably to each
non-rejecting Term Loan Lender, who shall have the right to reject such
additional amount, and any amounts so rejected shall be retained by the
Borrower. Notwithstanding anything to the contrary in the immediately preceding
sentence, prior to any repayment of a Swingline Borrowing hereunder, the
Borrower shall select the Borrowing or Borrowings to be repaid and shall notify
the Administrative Agent by telephone (confirmed by telecopy) of such selection
not later than 1:00 p.m., Local Time, on the scheduled date of such repayment.
Repayments of Borrowings shall be accompanied by accrued interest on the amount
repaid.

 

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SECTION 2.11. Prepayment of Loans.

(a) The Borrower shall have the right at any time and from time to time to
prepay any Borrowing in whole or in part, without premium or penalty (but
subject to Section 2.16), in an aggregate principal amount that is an integral
multiple of the Borrowing Multiple and not less than the Borrowing Minimum or,
if less, the aggregate amount then outstanding under the Term Facility (in the
case of a prepayment of a Term Borrowing) or the Revolving Facility (in the case
of a prepayment of a Revolving Borrowing), subject to prior notice in accordance
with Section 2.10(d).

(b) The Borrower shall apply all Net Proceeds promptly upon receipt thereof to
prepay Term Borrowings in accordance with paragraphs (c) and (d) of
Section 2.10.

(c) Not later than 90 days after the end of each Excess Cash Flow Period, the
Borrower shall calculate Excess Cash Flow for such Excess Cash Flow Period and
shall apply an amount equal to (x) the Required Percentage of such Excess Cash
Flow minus (y) the amount of any voluntary prepayments of Term Loans during such
Excess Cash Flow Period, other than, in each case, to the extent financed, or
intended to be financed, using the proceeds of the incurrence of Indebtedness
and so long as the amount of such prepayment is not already reflected in Debt
Service for such Excess Cash Flow Period to prepay Term Borrowings in accordance
with paragraphs (c) and (d) of Section 2.10. Not later than the date on which
the Borrower is required to deliver financial statements with respect to the end
of each Excess Cash Flow Period under Section 5.04(a), the Borrower shall
deliver to the Administrative Agent a certificate signed by a Financial Officer
of the Borrower setting forth the amount, if any, of Excess Cash Flow for such
fiscal year and the calculation thereof in reasonable detail.

SECTION 2.12. Fees.

(a) The Borrower agrees to pay to each Lender (other than any Defaulting
Lender), through the Administrative Agent, 10 Business Days after the last
Business Day of March, June, September and December in each year, and three
Business Days after the date on which the Revolving Facility Commitments of all
the Lenders shall be terminated as provided herein, a commitment fee (a
“Commitment Fee”) on the daily amount of the Available Unused Commitment of such
Lender during the preceding quarter (or other period commencing with the Closing
Date or ending with the date on which the last of the Commitments of such Lender
shall be terminated) at the Commitment Fee Rate. All Commitment Fees shall be
computed on the basis of the actual number of days elapsed in a year of 360
days. For the purpose of calculating any Lender’s Commitment Fee, the
outstanding Swingline Loans during the period for which such Lender’s Commitment
Fee is calculated shall reduce the amount of the Available Unused Commitment on
a dollar for dollar basis. The Commitment Fee due to each Lender shall commence
to accrue on the Closing Date and shall cease to accrue on the date on which the
last of the Commitments of such Lender shall be terminated as provided herein.

(b) The Borrower from time to time agrees to pay (i) to each Revolving Facility
Lender (other than any Defaulting Lender), through the Administrative Agent, 10
Business Days after the last day of March, June, September and December of each
year and three Business Days after the date on which the Revolving Facility
Commitments of all the Lenders shall be terminated as provided herein, a fee (an
“L/C Participation Fee”) on such Lender’s Revolving Facility Percentage of the
daily aggregate Revolving L/C Exposure (excluding the portion thereof
attributable to unreimbursed L/C Disbursements), during the preceding quarter
(or shorter period commencing with the Closing Date or ending with the Revolving
Facility Maturity Date or the date on which the Revolving Facility Commitments
shall be terminated) at the rate per annum equal to the Applicable Margin for
Eurocurrency Revolving Borrowings effective for each day in such period and
(ii) to each Issuing Bank, for its own account, (x) 10 Business Days after the
last day of March, June, September and December of each year and three Business
Days

 

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after the date on which the Revolving Facility Commitments of all the Lenders
shall be terminated as provided herein, a fronting fee in respect of each Letter
of Credit issued by such Issuing Bank for the period from and including the date
of issuance of such Letter of Credit to and including the termination of such
Letter of Credit, computed at a rate equal to 1/4 of 1% per annum of the daily
average stated amount of such Letter of Credit), plus (y) in connection with the
issuance, amendment or transfer of any such Letter of Credit or any L/C
Disbursement thereunder, such Issuing Bank’s customary documentary and
processing charges (collectively, “Issuing Bank Fees”). All L/C Participation
Fees and Issuing Bank Fees that are payable on a per annum basis shall be
computed on the basis of the actual number of days elapsed in a year of 360
days.

(c) The Borrower agrees to pay to the Administrative Agent, for the account of
the Administrative Agent, the agency fees set forth in the Fee Letter, as
amended, restated, supplemented or otherwise modified from time to time, at the
times specified therein (the “Administrative Agent Fees”).

(d) All Fees shall be paid on the dates due, in immediately available funds, to
the Administrative Agent for distribution, if and as appropriate, among the
Lenders, except that Issuing Bank Fees shall be paid directly to the applicable
Issuing Banks. Once paid, none of the Fees shall be refundable under any
circumstances.

SECTION 2.13. Interest.

(a) The Loans comprising each ABR Borrowing (including each Swingline Loan)
shall bear interest at the ABR plus the Applicable Margin.

(b) The Loans comprising each Eurocurrency Borrowing shall bear interest at the
Adjusted LIBO Rate for the Interest Period in effect for such Borrowing plus the
Applicable Margin.

(c) Notwithstanding the foregoing, during an Event of Default, all Obligations
shall, to the extent permitted by applicable law, bear interest, after as well
as before judgment, at a rate per annum equal to (i) in the case of overdue
principal of any Loan, 2% plus the rate otherwise applicable to such Loan as
provided in the preceding paragraphs of this Section or (ii) in the case of any
other amount, 2% plus the rate applicable to ABR Loans as provided in paragraph
(a) of this Section; provided that this paragraph (c) shall not apply to any
Event of Default that has been waived by the Lenders pursuant to Section 9.08.

(d) Accrued interest on each Loan shall be payable in arrears (i) on each
Interest Payment Date for such Loan, (ii) in the case of Revolving Facility
Loans, upon termination of the Revolving Facility Commitments and (iii) in the
case of the Term Loans, on the Term Facility Maturity Date; provided that
(i) interest accrued pursuant to paragraph (c) of this Section shall be payable
on demand, (ii) in the event of any repayment or prepayment of any Loan (other
than a prepayment of an ABR Revolving Loan prior to the end of the Availability
Period), accrued interest on the principal amount repaid or prepaid shall be
payable on the date of such repayment or prepayment and (iii) in the event of
any conversion of any Eurocurrency Loan prior to the end of the current Interest
Period therefor, accrued interest on such Loan shall be payable on the effective
date of such conversion.

(e) All interest hereunder shall be computed on the basis of a year of 360 days,
except that interest computed by reference to the ABR at times when the ABR is
based on the Prime Rate shall be computed on the basis of a year of 365 days (or
366 days in a leap year), and in each case shall be payable for the actual
number of days elapsed (including the first day but excluding the last day). The
applicable ABR, Adjusted LIBO Rate or LIBO Rate shall be determined by the
Administrative Agent, and such determination shall be conclusive absent manifest
error.

 

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SECTION 2.14. Alternate Rate of Interest. If prior to the commencement of any
Interest Period for a Eurocurrency Borrowing:

(a) the Administrative Agent determines (which determination shall be conclusive
absent manifest error) that adequate and reasonable means do not exist for
ascertaining the Adjusted LIBO Rate or the LIBO Rate, as applicable, for such
Interest Period; or

(b) the Administrative Agent is advised by the Required Lenders that the
Adjusted LIBO Rate or the LIBO Rate, as applicable, for such Interest Period
will not adequately and fairly reflect the cost to such Lenders of making or
maintaining their Loans included in such Borrowing for such Interest Period;

then the Administrative Agent shall give written notice thereof to the Borrower
and the Lenders as promptly as practicable thereafter and, until the
Administrative Agent notifies the Borrower and the Lenders that the
circumstances giving rise to such notice no longer exist, (i) any Interest
Election Request that requests the conversion of any Borrowing to, or
continuation of any Borrowing as, a Eurocurrency Borrowing denominated in such
currency shall be ineffective and such Borrowing shall be converted to or
continued as on the last day of the Interest Period applicable thereto an ABR
Borrowing, and (ii) if any Borrowing Request requests a Eurocurrency Borrowing,
such Borrowing shall be made as an ABR Borrowing.

SECTION 2.15. Increased Costs.

(a) If any Change in Law shall:

(i) impose, modify or deem applicable any reserve, special deposit or similar
requirement against assets of, deposits with or for the account of, or credit
extended by, any Lender (except any such reserve requirement reflected in the
Adjusted LIBO Rate) or Issuing Bank; or

(ii) impose on any Lender or Issuing Bank or the London interbank market any
other condition (other than Indemnified Taxes or Other Taxes that are
indemnifiable under Section 2.17 and Excluded Taxes) affecting this Agreement or
Eurocurrency Loans made by such Lender or any Letter of Credit or participation
therein;

and the result of any of the foregoing shall be to increase the cost to such
Lender of making or maintaining any Eurocurrency Loan (or of maintaining its
obligation to make any such Loan) or to increase the cost to such Lender or
Issuing Bank of participating in, issuing or maintaining any Letter of Credit or
to reduce the amount of any sum received or receivable by such Lender or Issuing
Bank hereunder (whether of principal, interest or otherwise), then the Borrower
will pay to such Lender or Issuing Bank, as applicable, such additional amount
or amounts as will compensate such Lender or Issuing Bank, as applicable, for
such additional costs incurred or reduction suffered.

(b) If any Lender or Issuing Bank determines that any Change in Law regarding
capital requirements has or would have the effect of reducing the rate of return
on such Lender’s or Issuing Bank’s capital or on the capital of such Lender’s or
Issuing Bank’s holding company, if any, as a consequence of this Agreement or
the Loans made by, or participations in Letters of Credit held by, such Lender,
or the Letters of Credit issued by such Issuing Bank, to a level below that
which such Lender or such Issuing Bank or such Lender’s or such Issuing Bank’s
holding company could have achieved but for such Change in Law (taking into
consideration such Lender’s or such Issuing Bank’s policies and the policies of
such Lender’s or such Issuing Bank’s holding company with respect to capital
adequacy), then from time to time the Borrower shall pay to such Lender or such
Issuing Bank, as applicable, such additional amount or amounts as will
compensate such Lender or such Issuing Bank or such Lender’s or such Issuing
Bank’s holding company for any such reduction suffered.

 

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(c) A certificate of a Lender or an Issuing Bank setting forth the amount or
amounts necessary to compensate such Lender or Issuing Bank or its holding
company, as applicable, as specified in paragraph (a) or (b) of this Section
shall be delivered to the Borrower and shall be conclusive absent manifest
error. The Borrower shall pay such Lender or Issuing Bank, as applicable, the
amount shown as due on any such certificate within 10 days after receipt
thereof.

(d) Promptly after any Lender or any Issuing Bank has determined that it will
make a request for increased compensation pursuant to this Section 2.15, such
Lender or Issuing Bank shall notify the Borrower thereof. Failure or delay on
the part of any Lender or Issuing Bank to demand compensation pursuant to this
Section shall not constitute a waiver of such Lender’s or Issuing Bank’s right
to demand such compensation; provided that the Borrower shall not be required to
compensate a Lender or an Issuing Bank pursuant to this Section for any
increased costs or reductions incurred more than 180 days prior to the date that
such Lender or Issuing Bank, as applicable, notifies the Borrower of the Change
in Law giving rise to such increased costs or reductions and of such Lender’s or
Issuing Bank’s intention to claim compensation therefor; provided, further,
that, if the Change in Law giving rise to such increased costs or reductions is
retroactive, then the 180-day period referred to above shall be extended to
include the period of retroactive effect thereof.

SECTION 2.16. Break Funding Payments. In the event of (a) the payment of any
principal of any Eurocurrency Loan other than on the last day of an Interest
Period applicable thereto (including as a result of an Event of Default),
(b) the conversion of any Eurocurrency Loan other than on the last day of the
Interest Period applicable thereto, (c) the failure to borrow, convert, continue
or prepay any Eurocurrency Loan on the date specified in any notice delivered
pursuant hereto or (d) the assignment of any Eurocurrency Loan other than on the
last day of the Interest Period applicable thereto as a result of a request by
the Borrower pursuant to Section 2.19, then, in any such event, the Borrower
shall compensate each Lender for the loss, cost and expense attributable to such
event. In the case of a Eurocurrency Loan, such loss, cost or expense to any
Lender shall be deemed to be the amount determined by such Lender to be the
excess, if any, of (i) the amount of interest which would have accrued on the
principal amount of such Loan had such event not occurred, at the Adjusted LIBO
Rate that would have been applicable to such Loan, for the period from the date
of such event to the last day of the then current Interest Period therefor (or,
in the case of a failure to borrow, convert or continue a Eurocurrency Loan, for
the period that would have been the Interest Period for such Loan), over
(ii) the amount of interest which would accrue on such principal amount for such
period at the interest rate which such Lender would bid were it to bid, at the
commencement of such period, for deposits in dollars of a comparable amount and
period from other banks in the Eurodollar market. A certificate of any Lender
setting forth any amount or amounts that such Lender is entitled to receive
pursuant to this Section shall be delivered to the Borrower and shall be
conclusive absent manifest error. The Borrower shall pay such Lender the amount
shown as due on any such certificate within 10 days after receipt thereof.

SECTION 2.17. Taxes.

(a) Any and all payments by or on account of any obligation of any Loan Party
hereunder shall be made free and clear of and without deduction for any
Indemnified Taxes or Other Taxes; provided that if a Loan Party shall be
required to deduct any Indemnified Taxes or 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) the Administrative Agent, any Lender or any Issuing Bank, as
applicable, receives an amount equal to the sum it would

 

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have received had no such deductions been made, (ii) such Loan Party shall make
such deductions and (iii) such Loan Party shall timely pay the full amount
deducted to the relevant Governmental Authority in accordance with applicable
law.

(b) In addition, the Loan Parties shall pay any Other Taxes to the relevant
Governmental Authority in accordance with applicable law.

(c) Each Loan Party shall indemnify the Administrative Agent, each Lender and
each Issuing Bank, within 20 days after written demand therefor, for the full
amount of any Indemnified Taxes or Other Taxes payable by the Administrative
Agent, such Lender or such Issuing Bank, as applicable, on or with respect to
any payment by or on account of any obligation of such Loan Party hereunder
(including Indemnified Taxes or Other Taxes imposed or asserted on or
attributable to amounts payable under this Section) and any reasonable expenses
arising therefrom or with respect thereto, except for any expenses that arise
from the gross negligence or willful misconduct on the part of the
Administrative Agent, such Lender or such Issuing Bank, as applicable. A
certificate as to the amount of such payment or liability, prepared in good
faith and delivered to such Loan Party by a Lender or an Issuing Bank, or by the
Administrative Agent on its own behalf, on behalf of another Agent or on behalf
of a Lender or an Issuing Bank, shall be conclusive absent manifest error of
which the Borrower has notified such Lender or Issuing Bank (and the
Administrative Agent) promptly after receipt of such certificate.

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

(e) Any Lender that is entitled to an exemption from or reduction of withholding
Tax under the law of the jurisdiction in which the Borrower is located, or any
treaty to which such jurisdiction is a party, with respect to payments under
this Agreement, shall deliver to the Borrower (with a copy to the Administrative
Agent), to the extent such Lender is legally entitled to do so, at the time or
times prescribed by applicable law and as reasonably requested by the Borrower
or the Administrative Agent, such properly completed and executed documentation
prescribed by applicable law as will permit such payments to be made without
such withholding tax or at a reduced rate; provided that no Lender shall have
any obligation under this paragraph (e) with respect to any withholding Tax
imposed by any jurisdiction other than the United States federal government if
in the reasonable judgment of such Lender such compliance would subject such
Lender to any unreimbursed cost or expense (which the Borrower has not agreed to
reimburse) or would otherwise be disadvantageous to such Lender in any material
respect.

(f) Each Foreign Lender shall deliver to the Borrower and the Administrative
Agent on the date on or before which such Foreign Lender becomes a Lender under
this Agreement (and promptly from time to time thereafter upon the reasonable
request of the Borrower or the Administrative Agent), two copies of whichever of
the following is applicable: (i) duly completed copies of Internal Revenue
Service Form W-8BEN (or any subsequent versions thereof or successors thereto),
claiming eligibility for benefits of an income tax treaty to which the United
States of America is a party, (ii) duly completed copies of Internal Revenue
Service Form W-8ECI (or any subsequent versions thereof or successors thereto),
(iii) in the case of a Foreign Lender claiming the benefits of the exemption for
portfolio interest under Section 871(h) or 881(c) of the Code, (x) a certificate
to the effect that such Foreign Lender is not (A) a “bank” within the meaning of
Section 881(c)(3)(A) of the Code, (B) a “10 percent shareholder” of the Borrower
within the meaning of Section 871(h)(3)(B) or 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) duly completed copies of Internal Revenue Service Form W-8BEN (or any
subsequent versions thereof or successors

 

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thereto), (iv) duly completed copies of Internal Revenue Service Form W-8IMY
together with the additional documentation that must be transmitted with Form
W-8IMY, including the appropriate forms described in (i), (ii) and (iii), or
(v) 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 Borrower to determine the withholding or deduction
required to be made. In addition, each Lender that is not a Foreign Lender other
than a Lender that may reasonably be treated as an exempt recipient based on the
indicators described in Treasury Regulation 1.6049-4(c)(1)(ii), shall deliver to
the Borrower and the Administrative Agent two duly completed copies of Internal
Revenue Service Form W-9 (or any subsequent versions thereof or successors
thereto) on or before the date such Lender becomes a Lender under this
Agreement. In addition, in each of the foregoing circumstances, each Lender
shall deliver such forms promptly upon the obsolescence or invalidity, in each
case, (caused by a change in such Lender’s circumstances) of any form previously
delivered by such Lender. Each Lender shall promptly notify the Borrower and the
Administrative Agent at any time it determines that it is no longer in a
position to provide any previously delivered form or certificate to the Borrower
(or any other form of certification adopted by the United States of America or
other taxing authorities for such purpose). Notwithstanding any other provision
of this paragraph, a Lender shall not be required to deliver any form pursuant
to this paragraph that such Lender is not legally able to deliver.

(g) If the Administrative Agent, Issuing Bank or a Lender determines, in its
reasonable sole discretion, that it has received a refund of any Indemnified
Taxes or Other Taxes as to which it has been indemnified by a Loan Party or with
respect to which such Loan Party has paid additional amounts pursuant to this
Section 2.17, it shall pay over such refund to such Loan Party (but only to the
extent of indemnity payments made, or additional amounts paid, by such Loan
Party under this Section 2.17 with respect to the Indemnified Taxes or Other
Taxes giving rise to such refund), net of all out-of-pocket expenses of the
Administrative Agent, Issuing Bank or such Lender (including any Taxes imposed
with respect to such refund) as is determined by the Administrative Agent,
Issuing Bank or Lender in good faith and in its sole discretion, and without
interest (other than any interest paid by the relevant Governmental Authority
with respect to such refund); provided that such Loan Party, upon the written
request of the Administrative Agent, Issuing Bank or such Lender, agrees to
repay as soon as reasonably practicable the amount paid over to such Loan Party
(plus any penalties, interest or other charges imposed by the relevant
Governmental Authority) to the Administrative Agent, Issuing Bank or such Lender
in the event the Administrative Agent, Issuing Bank or such Lender is required
to repay such refund to such Governmental Authority. This Section 2.17(g) shall
not be construed to require the Administrative Agent, Issuing Bank or any Lender
to make available its Tax returns (or any other information relating to its
Taxes which it deems confidential) to the Loan Parties or any other person.
Notwithstanding anything to the contrary, in no event will any Lender be
required to pay any amount to any Loan Party pursuant to this Section 2.17(g)
the payment of which would place such Lender in a less favorable net after-tax
position than such Lender would have been in if the additional amounts giving
rise to such refund of any Indemnified Taxes or Other Taxes had never been paid.

SECTION 2.18. Payments Generally; Pro Rata Treatment; Sharing of Set-offs.

(a) Unless otherwise specified, the Borrower shall make each payment required to
be made by it hereunder (whether of principal, interest, fees or reimbursement
of L/C Disbursements, or of amounts payable under Section 2.15, 2.16, or 2.17,
or otherwise) prior to 2:00 p.m., Local Time, on the date when due, in
immediately available funds, without condition or deduction for any defense,
recoupment, set-off or counterclaim. Any amounts received after such time on any
date may, in the discretion of the Administrative Agent, be deemed to have been
received on the next succeeding Business Day for purposes of calculating
interest thereon. All such payments shall be made to the Administrative Agent to
the

 

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applicable account designated to the Borrower by the Administrative Agent,
except payments to be made directly to the applicable Issuing Bank or the
Swingline Lender as expressly provided herein and except that payments pursuant
to Sections 2.15, 2.16, 2.17 and 9.05 shall be made directly to the persons
entitled thereto. The Administrative Agent shall distribute any such payments
received by it for the account of any other person to the appropriate recipient
promptly following receipt thereof. If any payment hereunder shall be due on a
day that is not a Business Day, the date for payment shall be extended to the
next succeeding Business Day, and, in the case of any payment accruing interest,
interest thereon shall be payable for the period of such extension. All payments
hereunder shall be made in Dollars. Any payment required to be made by the
Administrative Agent hereunder shall be deemed to have been made by the time
required if the Administrative Agent shall, at or before such time, have taken
the necessary steps to make such payment in accordance with the regulations or
operating procedures of the clearing or settlement system used by the
Administrative Agent to make such payment.

(b) If at any time insufficient funds are received by and available to the
Administrative Agent from the Borrower to pay fully all amounts of principal,
unreimbursed L/C Disbursements, interest and fees then due from the Borrower
hereunder, such funds shall be applied (i) first, towards payment of interest
and fees then due from the Borrower hereunder, ratably among the parties
entitled thereto in accordance with the amounts of interest and fees then due to
such parties, and (ii) second, towards payment of principal and unreimbursed L/C
Disbursements then due from the Borrower hereunder, ratably among the parties
entitled thereto in accordance with the amounts of principal and unreimbursed
L/C Disbursements then due to such parties.

(c) If any Lender shall, by exercising any right of set-off or counterclaim or
otherwise, obtain payment in respect of any principal of or interest on any of
its Term Loans, Revolving Facility Loans or participations in L/C Disbursements
or Swingline Loans resulting in such Lender receiving payment of a greater
proportion of the aggregate amount of its Term Loans, Revolving Facility Loans
and participations in L/C Disbursements and Swingline Loans and accrued interest
thereon than the proportion received by any other Lender, then the Lender
receiving such greater proportion shall purchase (for cash at face value)
participations in the Term Loans, Revolving Facility Loans and participations in
L/C Disbursements and Swingline Loans of other Lenders to the extent necessary
so that the benefit of all such payments shall be shared by the Lenders ratably
in accordance with the aggregate amount of principal of and accrued interest on
their respective Term Loans, Revolving Facility Loans and participations in L/C
Disbursements and Swingline Loans; provided that (i) if any such participations
are purchased and all or any portion of the payment giving rise thereto is
recovered, such participations shall be rescinded and the purchase price
restored to the extent of such recovery, without interest, and (ii) the
provisions of this paragraph (c) shall not be construed to apply to any payment
made by the Borrower pursuant to and in accordance with the express terms of
this Agreement or any payment obtained by a Lender as consideration for the
assignment of or sale of a participation in any of its Loans or participations
in L/C Disbursements to any assignee or participant, other than to the Borrower
or any Subsidiary or any Affiliate of the Borrower (as to which the provisions
of this paragraph (c) shall apply). The Borrower consents to the foregoing and
agrees, to the extent it may effectively do so under applicable law, that any
Lender acquiring a participation pursuant to the foregoing arrangements may
exercise against the Borrower rights of set-off and counterclaim with respect to
such participation as fully as if such Lender were a direct creditor of the
Borrower in the amount of such participation.

(d) Unless the Administrative Agent shall have received notice from the Borrower
prior to the date on which any payment is due to the Administrative Agent for
the account of the Lenders or the applicable Issuing Bank hereunder that the
Borrower will not make such payment, the Administrative Agent may assume that
the Borrower has made such payment on such date in accordance herewith and may,
in reliance upon such assumption, distribute to the Lenders or the applicable
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applicable, the amount due. In such event, if the Borrower has not in fact made
such payment, then each of the Lenders or the applicable Issuing Bank, as
applicable, severally agrees to repay to the Administrative Agent forthwith on
demand the amount so distributed to such Lender or Issuing Bank with interest
thereon, for each day from and including the date such amount is distributed to
it to but excluding the date of payment to the Administrative Agent, at the
greater of the Federal Funds Effective Rate and a rate determined by the
Administrative Agent in accordance with banking industry rules on interbank
compensation.

(e) If any Lender shall fail to make any payment required to be made by it
pursuant to Section 2.04(c), 2.05(d) or (e), 2.06(b) or 2.18(d), then the
Administrative Agent may, in its discretion (notwithstanding any contrary
provision hereof), apply any amounts thereafter received by the Administrative
Agent for the account of such Lender to satisfy such Lender’s obligations under
such Sections until all such unsatisfied obligations are fully paid.

SECTION 2.19. Mitigation Obligations; Replacement of Lenders.

(a) If any Lender requests compensation under Section 2.15, or if the Borrower
is required to pay any additional amount to any Lender or any Governmental
Authority for the account of any Lender pursuant to Section 2.17, then such
Lender shall use reasonable efforts to designate a different Lending Office for
funding or booking its Loans hereunder or to assign its rights and obligations
hereunder to another of its offices, branches or Affiliates, if, in the
reasonable judgment of such Lender, such designation or assignment (i) would
eliminate or reduce amounts payable pursuant to Section 2.15 or 2.17, as
applicable, in the future and (ii) would not subject such Lender to any material
unreimbursed cost or expense and would not otherwise be disadvantageous to such
Lender in any material respect. The Borrower hereby agrees to pay all reasonable
costs and expenses incurred by any Lender in connection with any such
designation or assignment.

(b) If any Lender requests compensation under Section 2.15, or if the Borrower
is required to pay any additional amount to any Lender or any Governmental
Authority for the account of any Lender pursuant to Section 2.17, or is a
Defaulting Lender, then the Borrower may, at its sole expense and effort, upon
notice to such Lender and the Administrative Agent, require such Lender to
assign and delegate, without recourse (in accordance with and subject to the
restrictions contained in Section 9.04), all its interests, rights and
obligations under this Agreement to an assignee that shall assume such
obligations (which assignee may be another Lender, if a Lender accepts such
assignment); provided that (i) the Borrower shall have received the prior
written consent of the Administrative Agent, which consent shall not
unreasonably be withheld, (ii) such Lender shall have received payment of an
amount equal to the outstanding principal of its Loans and participations in L/C
Disbursements and Swingline Loans, accrued interest thereon, accrued fees and
all other amounts payable to it hereunder, from the assignee (to the extent of
such outstanding principal and accrued interest and fees) or the Borrower (in
the case of all other amounts) and (iii) in the case of any such assignment
resulting from a claim for compensation under Section 2.15 or payments required
to be made pursuant to Section 2.17, such assignment will result in a reduction
in such compensation or payments. Nothing in this Section 2.19 shall be deemed
to prejudice any rights that the Borrower may have against any Lender that is a
Defaulting Lender.

(c) If any Lender (such Lender, a “Non-Consenting Lender”) has failed to consent
to a proposed amendment, waiver, discharge or termination which pursuant to the
terms of Section 9.08 requires the consent of all of the Lenders affected and
with respect to which the Required Lenders shall have granted their consent,
then the Borrower shall have the right (unless such Non-Consenting Lender grants
such consent) to replace such Non-Consenting Lender by requiring such
Non-Consenting Lender to promptly assign its Loans and its Commitments hereunder
to one or more assignees reasonably acceptable

 

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to the Administrative Agent that shall consent to such proposed amendment,
waiver, discharge or termination, provided that: (a) all Obligations of the
Borrower owing to such Non-Consenting Lender being replaced shall be paid in
full to such Non-Consenting Lender concurrently with such assignment, (b) the
replacement Lender shall purchase the foregoing by paying to such Non-Consenting
Lender a price equal to the principal amount thereof plus accrued and unpaid
interest thereon and (c) the replacement Lender shall pay the processing and
recordation fee referred to in Section 9.04(b)(ii)(B). In connection with any
such assignment the Borrower, Administrative Agent, such Non-Consenting Lender
and the replacement Lender shall otherwise comply with Section 9.04.

SECTION 2.20. Illegality. If any Lender reasonably determines that any Change in
Law has made it unlawful, or that any Governmental Authority has asserted after
the Closing Date that it is unlawful, for any Lender or its applicable Lending
Office to make or maintain any Eurocurrency Loans, then, on notice thereof by
such Lender to the Borrower through the Administrative Agent, any obligations of
such Lender to make or continue Eurocurrency Loans or to convert ABR Borrowings
to Eurocurrency Borrowings shall be suspended until such Lender notifies the
Administrative Agent and the Borrower that the circumstances giving rise to such
determination no longer exist. Upon receipt of such notice, the Borrower shall
upon demand from such Lender (with a copy to the Administrative Agent), either
convert all Eurocurrency Borrowings of such Lender to ABR Borrowings, either on
the last day of the Interest Period therefor, if such Lender may lawfully
continue to maintain such Eurocurrency Borrowings to such day, or immediately,
if such Lender may not lawfully continue to maintain such Loans. Upon any such
prepayment or conversion, the Borrower shall also pay accrued interest on the
amount so prepaid or converted. Notwithstanding the foregoing, the affected
Lender shall, prior to giving such notice to the Administrative Agent, designate
a different Lending Office if such designation would avoid the need for giving
such notice and if such designation would not otherwise by disadvantageous to
such lender in the good faith exercise of its reasonable judgment.

ARTICLE III

REPRESENTATIONS AND WARRANTIES

The Borrower represents and warrants to each of the Lenders that (it being
understood and agreed that the representations and warranties made on the
Closing Date are deemed to be made concurrently with the consummation of the
Transactions):

SECTION 3.01. Organization; Powers. Except as set forth on Schedule 3.01, the
Borrower and each of the Subsidiaries (a) is a limited partnership, limited
liability company or corporation duly organized, validly existing and in good
standing (or, if applicable in a foreign jurisdiction, enjoys the equivalent
status under the laws of any jurisdiction of organization outside the United
States) under the laws of the jurisdiction of its organization, (b) has all
requisite power and authority to own its property and assets and to carry on its
business as now conducted, (c) is qualified to do business in each jurisdiction
where such qualification is required, except where the failure so to qualify
could not reasonably be expected to have, individually or in the aggregate, a
Material Adverse Effect, or a material adverse effect on the validity or
enforceability of any of the Loan Documents or the rights and remedies of the
Administrative Agent and the Lenders thereunder and (d) has the power and
authority to execute, deliver and perform its obligations under each of the Loan
Documents and each other agreement or instrument contemplated thereby to which
it is or will be a party and, in the case of the Borrower, to borrow and
otherwise obtain credit hereunder.

SECTION 3.02. Authorization. The execution, delivery and performance by the
Borrower and each Subsidiary Loan Party of each of the Loan Documents to which
it is a party, and the borrowings

 

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hereunder and the transactions forming a part of the Transactions (a) have been
duly authorized by all corporate, stockholder, limited partnership or limited
liability company action required to be obtained by the Borrower and such
Subsidiary Loan Parties and (b) will not (i) violate (A) any provision of law,
statute, rule or regulation, or of the certificate or articles of incorporation
or other constitutive documents or by-laws of the Borrower or such Subsidiary
Loan Party, (B) any applicable order of any court or any rule, regulation or
order of any Governmental Authority or (C) any provision of any indenture,
certificate of designation for preferred stock, agreement or other instrument to
which the Borrower or such Subsidiary Loan Party is a party or by which any of
them or any of their property is or may be bound, (ii) be in conflict with,
result in a breach of or constitute (alone or with notice or lapse of time or
both) a default under, give rise to a right of or result in any cancellation or
acceleration of any right or obligation (including any payment) or to a loss of
a material benefit under any such indenture, certificate of designation for
preferred stock, agreement or other instrument, where any such conflict,
violation, breach or default referred to in clause (i) or (ii) of this
Section 3.02, could reasonably be expected to have, individually or in the
aggregate, a Material Adverse Effect, or a material adverse effect on the
validity or enforceability of any of the Loan Documents or the rights and
remedies of the Administrative Agent and the Lenders thereunder, or (iii) result
in the creation or imposition of any Lien upon or with respect to any property
or assets now owned or hereafter acquired by the Borrower or such Subsidiary
Loan Party, other than the Liens created by the Loan Documents and Liens
permitted by Section 6.02.

SECTION 3.03. Enforceability. This Agreement has been duly executed and
delivered by the Borrower and constitutes, and each other Loan Document when
executed and delivered by each Loan Party that is party thereto will constitute,
a legal, valid and binding obligation of such Loan Party enforceable against
each such Loan Party in accordance with its terms, subject to (i) the effects of
bankruptcy, insolvency, moratorium, reorganization, fraudulent conveyance or
other similar laws affecting creditors’ rights generally, (ii) general
principles of equity (regardless of whether such enforceability is considered in
a proceeding in equity or at law) and (iii) implied covenants of good faith and
fair dealing.

SECTION 3.04. Governmental Approvals. No action, consent or approval of,
registration or filing with or any other action by any Governmental Authority is
or will be required in connection with the Transactions, except for (a) the
filing of Uniform Commercial Code financing statements, (b) filings with the
United States Copyright Office and United States Patent and Trademark Office,
(c) recordation of the Mortgages, (d) such as have been made or obtained and are
in full force and effect, (e) such actions, consents and approvals the failure
to be obtained or made which could not reasonably be expected to have,
individually or in the aggregate, a Material Adverse Effect, or a material
adverse effect on the validity or enforceability of any of the Loan Documents or
the rights and remedies of the Administrative Agent and the Lenders thereunder,
and (f) filings or other actions listed on Schedule 3.04.

SECTION 3.05. Financial Statements.

(a) The unaudited pro forma consolidated balance sheet as of June 30, 2006 and
the Closing Date and related statements of income of Borrower, together with its
consolidated subsidiaries (including the notes thereto) (the “Pro Forma
Financial Statements”) for the four-quarter period ending June 30, 2006, and pro
forma EBITDA (the “Pro Forma EBITDA”) for the four-quarter period ending
June 30, 2006, copies of which have heretofore been furnished to each Lender via
inclusion in the Information Memorandum, have been prepared giving effect (as if
such events had occurred at the beginning of such period) to the Transactions.
Each of the Pro Forma Financial Statements and the Pro Forma EBITDA has been
prepared in good faith based on assumptions believed by the Borrower to have
been reasonable as of the date of delivery thereof (it being understood that
such assumptions are based on good faith estimates of certain items and that the
future results of operations and financial condition may differ

 

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materially therefrom) and, in the case of the Pro Forma Financial Statements,
have been prepared in accordance with Regulation S-X and including adjustments
substantially similar to those set forth on Schedule 1.01(a) and other
adjustments reasonably acceptable to the Arrangers, and presents fairly in all
material respects on a pro forma basis the estimated financial position of the
Borrower and its consolidated Subsidiaries as at the Closing Date, assuming that
the Transactions had actually occurred at the first day of the relevant period.

(b) The audited consolidated balance sheets of the Borrower as at December 31,
2005, 2004 and 2003, and the audited consolidated statements of income and cash
flows for such fiscal years, reported on by and accompanied by a report from
Ernst & Young LLP, copies of which have heretofore been furnished to each
Lender, present fairly the consolidated financial position of the Borrower, as
at each such date and the consolidated results of operations and cash flows of
the Borrower for the years then ended.

(c) The audited consolidated balance sheets of CipherTrust as at December 31,
2005, 2004 and 2003, and the audited consolidated statements of income and cash
flows for such fiscal years, reported on by and accompanied by a report from
KPMG LLP, copies of which have heretofore been furnished to each Lender, present
fairly the consolidated financial position of CipherTrust as at each such date
and the consolidated results of operations and cash flows of CipherTrust for the
years then ended.

(d) The unaudited interim consolidated balance sheets and related statements of
income and cash flows of (x) the Borrower and its subsidiaries and
(y) CipherTrust and its subsidiaries, for each fiscal quarter of the Borrower or
CipherTrust, as the case may be, ended at least 45 days prior to the Closing
Date and subsequent to December 31, 2005 (and, in each case, for the comparable
quarter in the previous fiscal year), present fairly the consolidated financial
condition of the Borrower and CipherTrust, as the case may be (subject to normal
year-end audit adjustments). All such financial statements have been prepared in
accordance with GAAP applied consistently throughout the periods involved
(subject to (i) normal year-end adjustments, (ii) adjustments, reclassifications
and exceptions set forth in the Acquisition Agreements and the schedules and
exhibits thereto and (iii) the absence of notes, except as approved by the
aforementioned firm of accountants and disclosed therein). Except as disclosed
on Schedule 6.01 or as, individually or in the aggregate, would not reasonably
be expected to have a Material Adverse Effect, none of the Borrower or any
Subsidiary has any material Guarantees, contingent liabilities and liabilities
for taxes, or any long-term leases or unusual forward or long-term commitments,
including any interest rate or foreign currency swap or exchange transaction or
other obligation in respect of derivatives, that are not reflected in the most
recent financial statements referred to in this paragraph or in the Pro Forma
Financial Statements. During the period from December 31, 2005 to and including
the Closing Date, there has been no disposition by the Borrower or any of its
Subsidiaries of any material part of its business or property.

SECTION 3.06. No Material Adverse Change or Material Adverse Effect. Since
December 31, 2005, there has been no event, circumstance or condition that has
or would reasonably be expected to have, individually or in the aggregate, a
Material Adverse Effect.

SECTION 3.07. Title to Properties; Possession Under Leases.

(a) The Borrower and each Subsidiary has good and insurable fee simple title to,
or valid leasehold interests in, or easements or other limited property
interests in, all its real properties (including all Mortgaged Properties) and
has good and marketable title to its personal property and assets, in each case,
except for defects in title that do not interfere with its ability to conduct
its business as currently conducted or to utilize such properties and assets for
their intended purposes and except where the failure to have such title could
not reasonably be expected to have, individually or in the aggregate, a Material
Adverse Effect. All such properties and assets are free and clear of Liens,
other than Liens expressly permitted by Section 6.02.

 

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(b) The Borrower and each Subsidiary has complied with all obligations under all
leases to which it is a party, except where the failure to comply would not have
a Material Adverse Effect, and all such leases are in full force and effect,
except leases in respect of which the failure to be in full force and effect
could not reasonably be expected to have, individually or in the aggregate, a
Material Adverse Effect. Except as set forth on Schedule 3.07(b), the Borrower
and each Subsidiary enjoys peaceful and undisturbed possession under all such
leases, other than leases in respect of which the failure to enjoy peaceful and
undisturbed possession could not reasonably be expected to have, individually or
in the aggregate, a Material Adverse Effect.

(c) As of the Closing Date, none of the Borrower or, to the Borrower’s
knowledge, any Subsidiary has received any notice of any pending or contemplated
condemnation proceeding affecting any of the Mortgaged Properties or any sale or
disposition thereof in lieu of condemnation that remains unresolved.

(d) None of the Borrower or any Subsidiary is obligated on the Closing Date
under any right of first refusal, option or other contractual right to sell,
assign or otherwise dispose of any Mortgaged Property or any interest therein,
except as permitted under Section 6.02 or 6.05.

SECTION 3.08. Subsidiaries.

(a) Schedule 3.08(a) sets forth as of the Closing Date the name and jurisdiction
of incorporation, formation or organization of each Subsidiary of the Borrower
and, as to each such Subsidiary, the percentage of each class of Equity
Interests owned by the Borrower or by any such Subsidiary.

(b) As of the Closing Date, there are no outstanding subscriptions, options,
warrants, calls, rights or other agreements or commitments (other than stock
options granted to employees or directors and directors’ qualifying shares) of
any nature relating to any Equity Interests of any Subsidiary.

SECTION 3.09. Litigation; Compliance with Laws.

(a) Except as set forth on Schedule 3.09, there are no actions, suits,
investigations or proceedings at law or in equity or by or on behalf of any
Governmental Authority or in arbitration now pending, or, to the knowledge of
the Borrower, threatened in writing against or affecting the Borrower or any
Subsidiary or any business, property or rights of any such person (i) that
involve any Loan Document or the Transactions or (ii) would reasonably be
expected to have, individually or in the aggregate, a Material Adverse Effect.

(b) None of the Borrower or any Subsidiary or any of their respective properties
or assets is in violation of (nor will the continued operation of their material
properties and assets as currently conducted violate) any law, rule or
regulation (including any zoning, building, ordinance, code or approval or any
building permit, but excluding any Environmental Laws, which are subject to
Section 3.16) or any restriction of record or agreement affecting any Mortgaged
Property, or is in default with respect to any judgment, writ, injunction or
decree of any Governmental Authority, where such violation or default could
reasonably be expected to have, individually or in the aggregate, a Material
Adverse Effect.

 

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SECTION 3.10. Federal Reserve Regulations.

(a) None of the Borrower and/or any Subsidiary is engaged principally, or as one
of its important activities, in the business of extending credit for the purpose
of purchasing or carrying Margin Stock.

(b) No part of the proceeds of any Loan will be used, whether directly or
indirectly, and whether immediately, incidentally or ultimately, (i) to purchase
or carry Margin Stock or to extend credit to others for the purpose of
purchasing or carrying Margin Stock or to refund indebtedness originally
incurred for such purpose, or (ii) for any purpose that entails a violation of,
or that is inconsistent with, the provisions of the Regulations of the Board,
including Regulation U or Regulation X.

SECTION 3.11. Investment Company Act. None of the Borrower or any Subsidiary is
an “investment company” as defined in, or subject to regulation under, the
Investment Company Act of 1940, as amended.

SECTION 3.12. Use of Proceeds. The Borrower will use the proceeds of the Term
Loans to (a) finance the Transactions and (b) pay related fees and expenses
incurred in connection with the Transactions. The Borrower will use the proceeds
of Revolving Facility Loans and Swingline Loans, and may request the issuance of
Letters of Credit, to provide ongoing working capital and for general corporate
purposes.

SECTION 3.13. Tax Returns.

(a) The Borrower and each Subsidiary has filed or caused to be filed all federal
and material state, local and non-U.S. Tax returns required to have been filed
by it on or before the date hereof, and each such Tax return is true and correct
in all material respects;

(b) The Borrower and each Subsidiary has timely paid or caused to be timely paid
all Taxes and assessments due and payable by it whether or not shown on the
returns referred to in clause (a) and has made adequate provision (in accordance
with GAAP) for the payment of all Taxes not yet due and payable with respect to
all periods or portions thereof ending on or before the Closing Date (except
Taxes or assessments that are being contested in good faith by appropriate
proceedings in accordance with Section 5.03 and for which the Borrower or such
Subsidiary (as the case may be) has set aside on its books adequate reserves in
accordance with GAAP), which Taxes, if not paid, could reasonably be expected to
have, individually or in the aggregate, a Material Adverse Effect; and

(c) Other than as could not be reasonably expected to have, individually or in
the aggregate, a Material Adverse Effect as of the Closing Date, with respect to
the Borrower and each Subsidiary, there are no claims being asserted in writing
with respect to any Taxes.

(d) None of the Borrower or its Subsidiaries has been a party to any
understanding or arrangement constituting a “tax shelter” within the meaning of
Section 6662(d)(2)(C)(ii) of the Code or within the meaning of Section 6111(c)
or Section 6111(d) of the Code as in effect immediately prior to the enactment
of the American Jobs Creation of 2004 with respect to a taxable year for which
the statute of limitations is not closed, or has “participated” in a “reportable
transaction” within the meaning of Treasury Regulation Section 1.6011-4 that has
not been properly disclosed pursuant to such regulation, except as could not
reasonably be expected to, individually or in the aggregate, have in a Material
Adverse Effect.

 

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SECTION 3.14. No Material Misstatements.

(a) All written information (other than the Projections, estimates and
information of a general economic nature) (the “Information”) concerning the
Borrower, the Subsidiaries, the Transactions and any other transactions
contemplated hereby included in the Information Memorandum or otherwise prepared
by or on behalf of the foregoing or their representatives and made available to
any Lenders or the Administrative Agent in connection with the Transactions or
the other transactions contemplated hereby, when taken as a whole, was true and
correct in all material respects as of the date such Information was furnished
to the Lenders and as of the Closing Date and did not contain any untrue
statement of a material fact as of any such date or omit to state a material
fact necessary in order to make the statements contained therein not materially
misleading in light of the circumstances under which such statements were made.

(b) The Projections and estimates and information of a general economic nature
prepared by or on behalf of the Borrower or any of their representatives and
that have been made available to any Lenders or the Administrative Agent in
connection with the Transactions or the other transactions contemplated hereby
included in the Information Memorandum or otherwise prepared by or on behalf of
the foregoing or their representative (i) have been prepared in good faith based
upon assumptions believed by the Borrower to be reasonable as of the date
thereof (it being understood that actual results may vary materially from the
Projections), as of the date such Projections and estimates were furnished to
the Lenders and as of the Closing Date, and (ii) as of the Closing Date, have
not been modified in any material respect by the Borrower.

SECTION 3.15. Employee Benefit Plans.

(a) Except as could not reasonably be expected to have, individually or in the
aggregate, a Material Adverse Effect: (i) the Borrower and each Subsidiary is in
compliance with the applicable provisions of ERISA and the provisions of the
Code relating to Plans and the regulations and published interpretations
thereunder; (ii) no Reportable Event has occurred during the past five years as
to which the Borrower or any Subsidiary or any ERISA Affiliate was required to
file a report with the PBGC, other than reports that have been filed; (iii) no
ERISA Event has occurred or is reasonably expected to occur; and (iv) none of
the Borrower, any Subsidiary or any ERISA Affiliate has received any written
notification that any Multiemployer Plan is in reorganization or has been
terminated within the meaning of Title IV of ERISA, or has knowledge that any
Multiemployer Plan is reasonably expected to be in reorganization or to be
terminated.

(b) Except where noncompliance would not reasonably be expected to result in a
Material Adverse Effect, each Foreign Plan has been maintained in substantial
compliance with its terms and with the requirements of any and all applicable
laws, statutes, rules, regulations and orders and has been maintained, where
required, in good standing with applicable regulatory authorities, and neither
the Borrower nor any Subsidiary have incurred any material obligation in
connection with the termination of or withdrawal from any Foreign Plan. Except
as would not reasonably be expected to have, individually or in the aggregate, a
Material Adverse Effect, the present value of the accrued benefit liabilities
(whether or not vested) under each Foreign Plan which is required to be funded,
determined as of the end of the most recently ended fiscal year of the Borrower
or Subsidiary (based on the actuarial assumptions used for purposes of the
applicable jurisdiction’s financial reporting requirements), did not exceed the
current value of the assets of such Foreign Plan, and for each Foreign Plan
which is not required to be funded, the obligations of such Foreign Plan are
properly accrued.

SECTION 3.16. Environmental Matters. Except as disclosed on Schedule 3.16 and
except as to matters that could not reasonably be expected to have, individually
or in the aggregate, a Material Adverse Effect: (i) no written notice, request
for information, claim, demand, order or complaint

 

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has been received by the Borrower or any Subsidiary, and there are no judicial,
administrative or other actions, suits or proceedings pending or, to the
Borrower’s knowledge, threatened in writing which allege a violation of or
liability under any Environmental Laws, in each case relating to the Borrower or
any Subsidiary, (ii) the Borrower and each Subsidiary has all authorizations and
permits necessary for its operations to comply with all applicable Environmental
Laws and is, and during the term of all applicable statutes of limitation, has
been, in compliance with the terms of such permits and with all other applicable
Environmental Laws, (iii) no Hazardous Material is located at, in, or under any
property currently or, the Borrower’s knowledge, formerly owned, operated or
leased by the Borrower or any Subsidiary that could reasonably be expected to
give rise to any liability or obligation of the Borrower or any Subsidiary under
any Environmental Laws, and no Hazardous Material has been generated, owned or
controlled or has been transported to or released at any location by the
Borrower or any Subsidiary in a manner that would reasonably be expected to give
rise to any liability or obligation of the Borrower or any Subsidiary under any
Environmental Laws, and (iv) there are no acquisition agreements in which the
Borrower or any Subsidiary has expressly assumed or undertaken responsibility
for any known or reasonably likely liability or obligation of any other Person
arising under or relating to Environmental Laws which, in any such case, has not
been made available to the Administrative Agent prior to the Closing Date.

SECTION 3.17. Security Documents.

(a) The Collateral Agreement is effective to create in favor of the
Administrative Agent (for the benefit of the Secured Parties) a legal, valid and
enforceable Lien on the Collateral described therein and proceeds thereof. In
the case of the Pledged Collateral described in the Collateral Agreement, when
certificates or promissory notes, as applicable, representing such Pledged
Collateral are delivered to the Administrative Agent, and in the case of the
other Collateral described in the Collateral Agreement (other than the
Intellectual Property (as defined in the Collateral Agreement)), when financing
statements and other filings attached as Schedule 6 to the Perfection
Certificate are filed in the offices specified on Schedule 7 of the Perfection
Certificate, the Administrative Agent (for the benefit of the Secured Parties)
shall have a fully perfected Lien on, and security interest in, all right, title
and interest of the Loan Parties in such Collateral and, subject to
Section 9-315 of the New York Uniform Commercial Code, the proceeds thereof, as
security for the Obligations to the extent perfection can be obtained by filing
Uniform Commercial Code financing statements, or possession, in each case prior
and superior in right to any other person (except, in the case of Collateral
other than Pledged Collateral, Liens expressly permitted by Section 6.02). In
addition, with respect to any deposit accounts and securities accounts
constituting Collateral, when control agreements required by the Collateral
Agreement are duly executed and delivered by the parties thereto, the security
interests in any such Collateral subject to such control agreements shall be
perfected.

(b) When the Collateral Agreement or an intellectual property security agreement
executed in accordance therewith is properly filed in the United States Patent
and Trademark Office or the United States Copyright Office, as applicable, and,
with respect to Collateral in which a security interest cannot be perfected by
such filings, upon the proper filing of the financing statements referred to in
paragraph (a) above, the Administrative Agent (for the benefit of the Secured
Parties) shall have a fully perfected Lien on, and security interest in, all
right, title and interest of the Loan Parties thereunder in the Intellectual
Property, in each case prior and superior in right to any other person (it being
understood that subsequent recordings in the United States Patent and Trademark
Office or the United States Copyright Office, as applicable, may be necessary to
perfect a lien on registered trademarks and patents, trademark and patent
applications and registered copyrights acquired by the grantors after the
Closing Date).

(c) Each Foreign Pledge Agreement, if any, shall be effective to create in favor
of the Administrative Agent, for the benefit of the Secured Parties, a legal,
valid and enforceable Lien on the

 

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Collateral described therein and proceeds thereof. In the case of the Pledged
Collateral described in a Foreign Pledge Agreement, when certificates
representing such Pledged Collateral are delivered to the Administrative Agent
and/or any other requirements described in such Foreign Pledge Agreement have
been complied with, the Administrative Agent (for the benefit of the Secured
Parties) shall have a fully perfected Lien on, and security interest in, all
right, title and interest of the Loan Parties in such Collateral and the
proceeds thereof, as security for the Obligations, in each case prior and
superior in right to any other person.

(d) The Mortgages executed and delivered after the Closing Date pursuant to
Section 5.10 shall be, effective to create in favor of the Administrative Agent
(for the benefit of the Secured Parties) a legal, valid and enforceable Lien on
all of the Loan Parties’ right, title and interest in and to the Mortgaged
Property thereunder and the proceeds thereof, and when such Mortgages are filed
or recorded in the proper real estate filing or recording offices, the
Administrative Agent (for the benefit of the Secured Parties) shall have a fully
perfected Lien on, and security interest in, all right, title and interest of
the Loan Parties in such Mortgaged Property and, to the extent applicable,
subject to Section 9-315 of the Uniform Commercial Code, the proceeds thereof,
in each case prior and superior in right to any other Person, other than with
respect to the rights of a Person pursuant to Liens expressly permitted by
Section 6.02.

SECTION 3.18. Location of Real Property and Leased Premises.

(a) Schedule 8 to the Perfection Certificate lists completely and correctly, as
of the Closing Date, all material real property owned by the Borrower and the
Subsidiary Loan Parties and the addresses thereof. As of the Closing Date, the
Borrower and the Subsidiary Loan Parties own in fee all the real property set
forth as being owned by them on such Schedules.

(b) The Borrower and the Subsidiary Loan Parties have valid leases in all
material real property leased by the Borrower and the Subsidiary Loan Parties.

SECTION 3.19. Solvency.

(a) Immediately after giving effect to the Transactions on the Closing Date,
(i) the fair value of the assets of the Borrower (individually) and the Borrower
and the Subsidiaries on a consolidated basis, at a fair valuation, will exceed
the debts and liabilities, direct, subordinated, contingent or otherwise, of the
Borrower (individually) and the Borrower and the Subsidiaries on a consolidated
basis, respectively; (ii) the present fair saleable value of the property of the
Borrower (individually) and the Borrower and the Subsidiaries on a consolidated
basis will be greater than the amount that will be required to pay the probable
liability of the Borrower (individually) and the Borrower and the Subsidiaries
on a consolidated basis, respectively, on their debts and other liabilities,
direct, subordinated, contingent or otherwise, as such debts and other
liabilities become absolute and matured; (iii) the Borrower (individually) and
the Borrower and the Subsidiaries on a consolidated basis will be able to pay
their debts and liabilities, direct, subordinated, contingent or otherwise, as
such debts and liabilities become absolute and matured; and (iv) the Borrower
(individually) and the Borrower and the Subsidiaries on a consolidated basis
will not have unreasonably small capital with which to conduct the businesses in
which they are engaged as such businesses are now conducted and are proposed to
be conducted following the Closing Date.

(b) The Borrower does not intend to, and does not believe that it or any of the
Subsidiaries will, incur debts beyond its ability to pay such debts as they
mature, taking into account the timing and amounts of cash to be received by it
or any such Subsidiary and the timing and amounts of cash to be payable on or in
respect of its Indebtedness or the Indebtedness of any such Subsidiary.

 

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SECTION 3.20. Labor Matters. Except as, individually or in the aggregate, would
not reasonably be expected to have a Material Adverse Effect: (a) there are no
strikes or other labor disputes pending or, to the knowledge of the Borrower,
threatened in writing against the Borrower or any Subsidiary; (b) the hours
worked and payments made to employees of the Borrower and each Subsidiary have
not been in violation of the Fair Labor Standards Act or any other applicable
law dealing with such matters; and (c) all payments due from the Borrower and
each Subsidiary or for which any claim may be made against the Borrower or any
Subsidiary, on account of wages and employee health and welfare insurance and
other benefits have been paid or accrued as a liability on the books of the
Borrower or such Subsidiary to the extent required by GAAP. Except (i) as,
individually or in the aggregate, would not reasonably be expected to have a
Material Adverse Effect or (ii) as set forth on Schedule 3.20, the consummation
of the Transactions will not give rise to a right of termination or right of
renegotiation on the part of any union under any material collective bargaining
agreement to which the Borrower or any Subsidiary (or any predecessor of the
Borrower or any Subsidiary) is a party or by which the Borrower or any
Subsidiary (or any predecessor of the Borrower or any Subsidiary) is bound.

SECTION 3.21. Insurance. Schedule 3.21 sets forth a true, complete and correct
description of all material insurance maintained by or on behalf of the Borrower
or any Subsidiary as of the Closing Date. As of such date, such insurance is in
full force and effect. The Borrower believes that the insurance maintained by or
on behalf of the Borrower and the Subsidiaries is adequate.

SECTION 3.22. Anti-Terrorism Law.

(a) No Loan Party and, to the knowledge of the Loan Parties, none of its
Affiliates is in violation of any Requirement of Law relating to terrorism or
money laundering (“Anti-Terrorism Laws”), including Executive Order No. 13224 on
Terrorist Financing, effective September 24, 2001 (the “Executive Order”), and
the Uniting and Strengthening America by Providing Appropriate Tools Required to
Intercept and Obstruct Terrorism Act of 2001, Public Law 107-56.

(b) To the knowledge of the Loan Parties, no Loan Party and no Affiliate or
broker or other agent of any Loan Party acting or benefiting in any capacity in
connection with the Loans is any of the following:

(i) a person that is listed in the annex to, or is otherwise subject to the
provisions of, the Executive Order;

(ii) a person owned or controlled by, or acting for or on behalf of, any person
that is listed in the annex to, or is otherwise subject to the provisions of,
the Executive Order;

(iii) a person with which any Lender is prohibited from dealing or otherwise
engaging in any transaction by any Anti-Terrorism Law;

(iv) a person that commits, threatens or conspires to commit or supports
“terrorism” as defined in the Executive Order; or

(v) a person that is named as a “specially designated national and blocked
person” on the most current list published by the U.S. Treasury Department
Office of Foreign Assets Control (“OFAC”) at its official website or any
replacement website or other replacement official publication of such list.

(c) To the knowledge of the Loan Parties, no Loan Party, no Subsidiary of the
Borrower and no broker or other agent of any Loan Party acting in any capacity
in connection with the Loans

 

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(i) conducts any business or engages in making or receiving any contribution of
funds, goods or services to or for the benefit of any person described in
paragraph (b) above, (ii) deals in, or otherwise engages in any transaction
relating to, any property or interests in property blocked pursuant to the
Executive Order, or (iii) engages in or conspires to engage in any transaction
that evades or avoids, or has the purpose of evading or avoiding, or attempts to
violate, any of the prohibitions set forth in any Anti-Terrorism Law.

SECTION 3.23. Acquisition Agreement; Representations and Warranties in
Acquisition Agreement.

(a) Schedule 3.23 lists (i) each exhibit, schedule, annex or other attachment to
the Acquisition Agreement and (ii) each agreement, certificate, instrument,
letter or other document contemplated by the Acquisition Agreement or any item
referred to in clause (i) to be entered into, executed or delivered or to become
effective in connection with the Acquisition or otherwise entered into, executed
or delivered in connection with the Acquisition. The Lenders have been furnished
true and correct copies of each Acquisition Document to the extent executed and
delivered on or prior to the Closing Date.

(b) All representations and warranties of each Loan Party set forth in the
Acquisition Agreement were true and correct in all material respects as of the
time such representations and warranties were made and shall be true and correct
in all material respects as of the Closing Date as if such representations and
warranties were made on and as of such date, unless stated to relate to a
specific earlier date, in which case such representations and warranties shall
be true and correct in all material respects as of such earlier date.

SECTION 3.24. Intellectual Property.

(a) Each Loan Party owns, or is licensed to use, all patents, patent
applications, trademarks, trade names, service marks, copyrights, technology,
trade secrets, proprietary information, domain names, know-how and processes
necessary for the conduct of its business as currently conducted (the
“Intellectual Property”), except for those the failure to own or license which,
individually or in the aggregate, could not reasonably be expected to result in
a Material Adverse Effect. Except as set forth in Schedule 3.24(a), to each Loan
Party’s knowledge, no claim has been asserted and is pending by any person
challenging the use of any such Intellectual Property by such Loan Party or the
validity or effectiveness of any such Intellectual Property owned by such Loan
Party, nor does any Loan Party know of any valid basis for such claim. To each
Loan Party’s knowledge, the use of such Intellectual Property by such Loan Party
does not infringe the intellectual property rights of any Person, except for
such claims and infringements that, individually or in the aggregate, would not
reasonably be expected to result in a Material Adverse Effect.

(b) Set forth on Schedule 3.24(b) are all issued patents, trademark
registrations, copyright registrations, and all applications for any of the
foregoing in the United States owned by the Loan Parties. Except pursuant to
licenses and other user agreements entered into by each Loan Party in the
ordinary course of business, on and as of the date hereof (i) to the knowledge
of each Loan Party, each Loan Party owns and possesses the right to use, and has
done nothing to authorize or enable any other person to use, any copyright,
patent or trademark (as such terms are defined in the Collateral Agreement)
listed on Schedule 3.24(b) and (ii) to the knowledge of the Loan Party, all
registrations listed on Schedule 3.24(b) are valid and in full force and effect.

(c) To each Loan Party’s knowledge, on and as of the date hereof, there is no
material infringement by others of any right of such Loan Party with respect to
any copyright, patent or trademark owned by any of the Loan Parties and listed
on Schedule 3.24(b), pledged by it under the name of such Loan Party except as
may be set forth on Schedule 3.24(c).

 

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SECTION 3.25. Agreements. No Loan Party is a party to any agreement or
instrument or subject to any corporate or other constitutional restriction that
has resulted or could reasonably be expected to result in a Material Adverse
Effect. No Loan Party is in default in any manner under any provision of any
indenture or other agreement or instrument evidencing Indebtedness, or any other
agreement or instrument to which it is a party or by which it or any of its
property is or may be bound, where such default could reasonably be expected to
result in a Material Adverse Effect, and no condition exists which, with the
giving of notice or the lapse of time or both, would constitute such a default.
Schedule 3.25 accurately and completely lists all material agreements to which
any Loan Party is a party which are in effect on the date hereof in connection
with the operation of the business conducted thereby and Borrower has delivered
to the Administrative Agent complete and correct copies of all such material
agreements, including any amendments, supplements or modifications with respect
thereto, and all such agreements are in full force and effect.

ARTICLE IV

CONDITIONS OF LENDING

The obligations of (a) the Lenders (including the Swingline Lender) to make
Loans and (b) any Issuing Bank to issue Letters of Credit or increase the stated
amounts of Letters of Credit hereunder (each, a “Credit Event”) are subject to
the satisfaction of the following conditions:

SECTION 4.01. All Credit Events. On the date of each Borrowing and on the date
of each issuance, amendment, extension or renewal of a Letter of Credit:

(a) The Administrative Agent shall have received, in the case of a Borrowing, a
Borrowing Request as required by Section 2.03 (or a Borrowing Request shall have
been deemed given in accordance with the last paragraph of Section 2.03) or, in
the case of the issuance of a Letter of Credit, the applicable Issuing Bank and
the Administrative Agent shall have received a notice requesting the issuance of
such Letter of Credit as required by Section 2.05(b).

(b) The representations and warranties set forth in Article III (other than,
(1) if the date of such Borrowing or issuance, amendment, extension or renewal
of a Letter of Credit is after the Closing Date, in Section 3.23(b) and (2) if
the date of such Borrowing or issuance, amendment, extension or renewal of a
Letter of Credit is the Closing Date, in Section 3.06) shall be true and correct
in all material respects as of such date (other than an amendment, extension or
renewal of a Letter of Credit without any increase in the stated amount of such
Letter of Credit), as applicable, with the same effect as though made on and as
of such date, except to the extent such representations and warranties expressly
relate to an earlier date (in which case such representations and warranties
shall have been true and correct in all material respects as of such earlier
date).

(c) At the time of and immediately after such Borrowing or issuance, amendment,
extension or renewal of a Letter of Credit (other than an amendment, extension
or renewal of a Letter of Credit without any increase in the stated amount of
such Letter of Credit), as applicable, no Event of Default or Default shall have
occurred and be continuing.

Each Borrowing and each issuance, amendment, extension or renewal of a Letter of
Credit shall be deemed to constitute a representation and warranty by the
Borrower on the date of such Borrowing, issuance, amendment, extension or
renewal, as applicable, as to the matters specified in paragraphs (b) and (c) of
this Section 4.01.

 

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SECTION 4.02. First Credit Event. On the Closing Date:

(a) The Administrative Agent (or its counsel) shall have received from each
party hereto either (i) a counterpart of this Agreement signed on behalf of such
party or (ii) written evidence satisfactory to the Administrative Agent (which
may include telecopy transmission of a signed signature page of this Agreement)
that such party has signed a counterpart of this Agreement.

(b) The Administrative Agent shall have received, on behalf of itself, the
Lenders and each Issuing Bank on the Closing Date, a favorable written opinion
of (i) Heller Ehrman LLP, special counsel for the Borrower and the Subsidiary
Loan Parties, in form and substance reasonably satisfactory to the
Administrative Agent and (ii) local counsel (including United Kingdom) to the
Subsidiary Loan Parties reasonably satisfactory to the Administrative Agent as
specified on Schedule 4.02(b), in each case (A) dated the Closing Date,
(B) addressed to each Issuing Bank on the Closing Date, the Administrative Agent
and the Lenders and (C) in form and substance reasonably satisfactory to the
Administrative Agent and covering such other matters relating to the Loan
Documents and the Transactions as the Administrative Agent shall reasonably
request, and the Borrower hereby instructs its counsel to deliver such opinions.

(c) The Administrative Agent shall have received in the case of each Loan Party
each of the items referred to in clauses (i), (ii), (iii) and (iv) below:

(i) a copy of the certificate or articles of incorporation, certificate of
limited partnership or certificate of formation, including all amendments
thereto, of each Loan Party, (A) in the case of a corporation, certified as of a
recent date by the Secretary of State (or other similar official) of the
jurisdiction of its organization, and a certificate as to the good standing (to
the extent such concept or a similar concept exists under the laws of such
jurisdiction) of each such Loan Party as of a recent date from such Secretary of
State (or other similar official) or (B) in the case of a limited partnership or
limited liability company, certified by the secretary or assistant secretary of
each such Loan Party;

(ii) a certificate of the secretary or assistant secretary or similar officer of
each Loan Party dated the Closing Date and certifying

(A) that attached thereto is a true and complete copy of the by-laws (or limited
partnership agreement, limited liability company agreement or other equivalent
governing documents) of such Loan Party as in effect on the Closing Date and at
all times since a date prior to the date of the resolutions described in clause
(B) below,

(B) that attached thereto is a true and complete copy of resolutions duly
adopted by the board of directors (or equivalent governing body) of such Loan
Party (or its managing general partner or managing member) authorizing the
execution, delivery and performance of the Loan Documents to which such person
is a party and, in the case of the Borrower, the borrowings hereunder, and that
such resolutions have not been modified, rescinded or amended and are in full
force and effect on the Closing Date,

(C) that the certificate or articles of incorporation, certificate of limited
partnership or certificate of formation of such Loan Party has not been amended
since the date of the last amendment thereto disclosed pursuant to clause
(i) above,

 

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(D) as to the incumbency and specimen signature of each officer executing any
Loan Document or any other document delivered in connection herewith on behalf
of such Loan Party, and

(E) as to the absence of any pending proceeding for the dissolution or
liquidation of such Loan Party or, to the knowledge of such person, threatening
the existence of such Loan Party;

(iii) a certificate of another officer as to the incumbency and specimen
signature of the Secretary or Assistant Secretary or similar officer executing
the certificate pursuant to clause (ii) above; and

(iv) such other documents as the Administrative Agent, the Lenders and any
Issuing Bank on the Closing Date may reasonably request (including without
limitation, tax identification numbers and addresses).

(d) The Collateral and Guarantee Requirement shall have been satisfied (except
as to those matters that are Post-Closing Items) and the Administrative Agent
shall have received a completed Perfection Certificate dated the Closing Date
and signed by a Responsible Officer of the Borrower, together with all
attachments contemplated thereby, and the results of a search of the Uniform
Commercial Code, tax and judgment lien filings made with respect to the Loan
Parties in the jurisdictions contemplated by the Perfection Certificate and
copies of the financing statements (or similar documents) disclosed by such
search and evidence reasonably satisfactory to the Administrative Agent that the
Liens indicated by such financing statements (or similar documents) are
permitted by Section 6.02 or have been released and, with respect to all Uniform
Commercial Code financing statements required to be filed pursuant to the Loan
Documents, the Administrative Agent shall have received evidence satisfactory to
it that the Borrower has retained, at its sole cost and expense, a service
provider acceptable to the Administrative Agent for the tracking of all such
financing statements and notification to the Administrative Agent, of, among
other things, the upcoming lapse or expiration thereof.

(e) The Acquisition shall have been consummated or shall be consummated
simultaneously with or immediately following the closing under this Agreement in
accordance with the terms and conditions of the Acquisition as set forth in the
Acquisition Agreement, without material amendment, modification or waiver
thereof which is materially adverse to the Lenders without the prior written
consent of the Joint Lead Arrangers.

(f) The Lenders shall have received the financial statements referred to in
Section 3.05.

(g) The Lenders shall have received a solvency certificate substantially in the
form of Exhibit E and signed by the Chief Financial Officer of the Borrower
confirming the solvency of the Borrower and its Subsidiaries on a consolidated
basis, after giving effect to the Transactions on the Closing Date.

(h) The Agents shall have received all fees payable thereto or to any Lender on
or prior to the Closing Date and, to the extent invoiced, all other amounts due
and payable pursuant to the Loan Documents on or prior to the Closing Date,
including, to the extent invoiced, reimbursement

 

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or payment of all reasonable out-of-pocket expenses (including reasonable fees,
charges and disbursements of Cahill Gordon & Reindel llp and U.S. local counsel)
required to be reimbursed or paid by the Loan Parties hereunder or under any
Loan Document.

(i) The Agents shall have received, at least five Business Days prior to the
Closing Date, all documentation and other information required by bank
regulatory authorities under applicable “know your customer” and anti-money
laundering rules and regulations, including without limitation the Act (as
defined in Section 9.19).

(j) The Administrative Agent shall have received a certificate, dated the
Closing Date and signed by a Responsible Officer of the Borrower, confirming
compliance with the conditions precedent set forth in Section 4.01(b) and (c).

(k) After giving effect to the Transactions and the other transactions
contemplated hereby, neither Borrower nor any of its Subsidiaries, including
CipherTrust, shall have outstanding any Indebtedness, including principal,
interest, fees and any other amounts outstanding, other than (i) the Facilities
and credit extensions hereunder and (ii) other Indebtedness on Schedule 4.02(k).

Each Agent and each Lender, by delivering its signature page to this Agreement
and funding a Loan on the Closing Date shall be deemed to have acknowledged
receipt of and consented to and approved each Loan Document and each other
document required to be approved by any Agent or Lender, as applicable, on the
Closing Date.

ARTICLE V

AFFIRMATIVE COVENANTS

The Borrower covenants and agrees with each Lender that so long as this
Agreement shall remain in effect and until the Commitments have been terminated
and the principal of and interest on each Loan, all Fees and all other expenses
or amounts payable under any Loan Document shall have been paid in full and all
Letters of Credit have been canceled or have expired and all amounts drawn
thereunder have been reimbursed in full, unless the Required Lenders shall
otherwise consent in writing, the Borrower shall, and shall cause each of the
Subsidiaries to:

SECTION 5.01. Existence; Businesses and Properties.

(a) Do or cause to be done all things necessary to preserve, renew and keep in
full force and effect its legal existence, except, in the case of a Subsidiary,
(i) where the failure to do so would not reasonably be expected to have a
Material Adverse Effect or a material adverse effect on the validity or
enforceability of any of the Loan Documents or the rights and remedies of the
Administrative Agent and the Lenders thereunder, (ii) as otherwise expressly
permitted under Section 6.05, or (iii) the liquidation or dissolution of
Subsidiaries if the assets of such Subsidiaries to the extent they exceed
estimated liabilities are acquired by the Borrower or a Wholly Owned Subsidiary
of the Borrower in such liquidation or dissolution; provided that Subsidiary
Loan Parties may not be merged into Subsidiaries that are not Loan Parties and
Domestic Subsidiaries may not be merged into Foreign Subsidiaries.

(b) Except where the failure to do so would not reasonably be expected to have,
individually or in the aggregate, a Material Adverse Effect, to use commercially
reasonable efforts to (i) lawfully obtain, preserve, renew, extend and keep in
full force and effect the permits, franchises, authorizations, patents,
trademarks, service marks, trade names, copyrights, licenses and rights with
respect

 

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thereto necessary to the normal conduct of its business, and (ii) at all times
maintain and preserve all property necessary to the normal conduct of its
business and keep such property in good repair, working order and condition and
from time to time make, or cause to be made, all needful and proper repairs,
renewals, additions, improvements and replacements thereto necessary in order
that the business carried on in connection therewith, if any, may be properly
conducted at all times (in each case except as expressly permitted by the Loan
Documents).

SECTION 5.02. Insurance.

(a) Maintain, with financially sound and reputable insurance companies,
insurance in such amounts (after giving effect to any self-insurance reasonable
and customary for similarly situated companies engaged in the same or similar
businesses as the Borrower and the Subsidiaries) and against such risks as are
customarily maintained by similarly situated companies engaged in the same or
similar businesses operating in the same or similar locations and cause the
Administrative Agent to be listed as a co-loss payee on property and casualty
policies and as an additional insured on liability policies.

(b) If at any time the area in which the Premises (as defined in the Mortgages)
are located is designated a “flood hazard area” in any Flood Insurance Rate Map
published by the Federal Emergency Management Agency (or any successor agency),
obtain flood insurance in such total amount as the Administrative Agent may from
time to time reasonably require, and otherwise comply with the National Flood
Insurance Program as set forth in the Flood Disaster Protection Act of 1973, as
it may be amended from time to time.

(c) All such insurance shall provide that no cancellation, material reduction in
amount or material change in coverage thereof shall be effective until at least
30 days after receipt by the Administrative Agent of written notice thereof.

(d) Deliver to the Administrative Agent and the Lenders a report of a reputable
insurance broker with respect to such insurance and such supplemental reports
with respect thereto as the Administrative Agent may from time to time
reasonably request.

(e) No Loan Party that is an owner of Mortgaged Property shall take any action
that is reasonably likely to be the basis for termination, revocation or denial
of any insurance coverage required to be maintained under such Loan Party’s
respective Mortgage or that could be the basis for a defense to any claim under
any insurance policy maintained in respect of the premises.

SECTION 5.03. Taxes. Pay and discharge promptly when due all material Taxes
imposed upon it or upon its income or profits or in respect of its property
before the same shall become delinquent or in default, as well as all lawful
claims which, if unpaid, might give rise to a Lien upon such properties or any
part thereof; provided, however, that such payment and discharge shall not be
required with respect to any such Tax or claim so long as such Tax or claim is
being contested in good faith by appropriate proceedings, and the Borrower or
the affected Subsidiary, as the case may be, shall have set aside on its books
reserves in accordance with GAAP with respect thereto.

SECTION 5.04. Financial Statements, Reports, etc. Furnish to the Administrative
Agent (which will promptly furnish such information to the Lenders):

(a) within 90 days after the end of each fiscal year of the Borrower, a
consolidated balance sheet and related statements of operations, cash flows and
owners’ equity showing the financial position of the Borrower and the
Subsidiaries as of the close of such fiscal year and the consolidated results of
their operations during such year and setting forth in comparative form the

 

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corresponding figures for the prior fiscal year, which consolidated balance
sheet and related statements of operations, cash flows and owners’ equity shall
be audited by independent public accountants of recognized national standing and
accompanied by an opinion of such accountants (which shall not be subject to any
“going concern” or like qualification or exception or any qualification or
exception as to the scope of such audit) to the effect that such consolidated
financial statements fairly present, in all material respects, the financial
position and results of operations of the Borrower and its Subsidiaries on a
consolidated basis in accordance with GAAP (it being understand that the
information required by clause (a) may be furnished in the form of a Form 10-K);

(b) within 45 days after the end of each of the first three fiscal quarters of
each fiscal year, (or such earlier date on which the Borrower is required to
file a Form 10-Q under the Exchange Act), a consolidated balance sheet and
related statements of operations and cash flows showing the financial position
of the Borrower and its Subsidiaries as of the close of such fiscal quarter and
the consolidated results of its operations during such fiscal quarter and the
then-elapsed portion of the fiscal year and setting forth in comparative form
the corresponding figures for the corresponding periods of the prior fiscal
year, all of which shall be in reasonable detail and which consolidated balance
sheet and related statements of operations and cash flows shall be certified by
a Financial Officer of the Borrower on behalf of the Borrower as fairly
presenting, in all material respects, the financial position and results of
operations of the Borrower and the Subsidiaries on a consolidated basis in
accordance with GAAP (subject to normal year-end audit adjustments and the
absence of footnotes) (it being understood that the information required by this
clause (b) may be furnished in the form of a 10-Q);

(c) concurrently with any delivery of financial statements under paragraph
(a) or (b) above, a certificate of a Financial Officer of the Borrower
(i) certifying that no Event of Default or Default has occurred or, if such an
Event of Default or Default has occurred, specifying the nature and extent
thereof and any corrective action taken or proposed to be taken with respect
thereto and (ii) commencing with the fiscal quarter ending December 31, 2006,
setting forth computations in reasonable detail satisfactory to the
Administrative Agent demonstrating compliance with the Financial Performance
Covenants;

(d) promptly after the same become publicly available, copies of all periodic
and other publicly available reports, proxy statements and, to the extent
reasonably requested by the Administrative Agent, other materials filed by the
Borrower or any Subsidiary with the SEC, or after an initial public offering,
distributed to its stockholders generally, as applicable;

(e) within 90 days after the beginning of each fiscal year, a detailed
consolidated quarterly budget for such fiscal year (including a projected
consolidated balance sheet of the Borrower and the Subsidiaries as of the end of
the following fiscal year, and the related consolidated statements of projected
cash flow and projected income) and, as soon as available, significant
revisions, if any, of such budget and quarterly projections with respect to such
fiscal year, including a description of underlying assumptions with respect
thereto (collectively, the “Budget”), which Budget shall in each case be
accompanied by the statement of a Financial Officer of the Borrower to the
effect that the Budget for the period covered thereby has been prepared in good
faith;

(f) upon the reasonable request of the Administrative Agent, an updated
Perfection Certificate (or, to the extent such request relates to specified
information contained in the Perfection Certificate, such information)
reflecting all changes since the date of the information most recently received
pursuant to this paragraph (f) or Section 5.10(f);

 

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(g) promptly, a copy of all reports submitted to the board of directors (or any
committee thereof) of the Borrower or any Subsidiary in connection with any
material interim or special audit made by independent accountants of the books
of the Borrower or such Subsidiary (excluding any reports which have been
identified as confidential);

(h) promptly following a request therefor, all documentation and other
information that the Administrative Agent reasonably requests on its own behalf
or on behalf of any Lender in order to comply with ongoing obligations under
applicable “know your customer” and anti-money laundering rules and regulations,
including the Act; and

(i) promptly, from time to time, such other information regarding the
operations, business affairs and financial condition of the Borrower or any
Subsidiary, or compliance with the terms of any Loan Document, or such
consolidated financial statements, as in each case the Administrative Agent may
reasonably request on its own behalf or on behalf of any Lender.

SECTION 5.05. Litigation and Other Notices. Furnish to the Administrative Agent
written notice of the following promptly after any Responsible Officer of the
Borrower obtains actual knowledge thereof:

(a) any Event of Default or Default, specifying the nature and extent thereof
and the corrective action (if any) proposed to be taken with respect thereto;

(b) the filing or commencement of, or any written threat or notice of intention
of any person to file or commence, any action, suit or proceeding, whether at
law or in equity or by or before any Governmental Authority or in arbitration,
against the Borrower or any Subsidiary as to which an adverse determination is
reasonably probable and which, if adversely determined, could reasonably be
expected to have a Material Adverse Effect;

(c) any other development specific to the Borrower or any Subsidiary that is not
a matter of general public knowledge and that has had, or could reasonably be
expected to have, a Material Adverse Effect; and

(d) the occurrence of any ERISA Event (or termination of, withdrawal from, or
noncompliance with applicable law or plan terms with respect to, Foreign Plans)
that, together with all other ERISA Events (and any such termination, withdrawal
or noncompliance with respect to Foreign Plans) that have occurred, could
reasonably be expected to have a Material Adverse Effect.

SECTION 5.06. Compliance with Laws. Comply with all laws, rules, regulations and
orders of any Governmental Authority applicable to it or its property, except
where the failure to do so, individually or in the aggregate, could not
reasonably be expected to result in a Material Adverse Effect; provided that
this Section 5.06 shall not apply to Environmental Laws, which are the subject
of Section 5.09, or to laws related to Taxes, which are the subject of
Section 5.03.

SECTION 5.07. Maintaining Records; Access to Properties and Inspections.
Maintain all financial records in accordance with GAAP and permit any persons
designated by the Administrative Agent or any Lender to visit and inspect the
financial records and the properties of the Borrower or any Subsidiary at
reasonable times, upon reasonable prior notice to the Borrower, and as often as
reasonably requested and to make extracts from and copies of such financial
records, and permit any persons designated by the Administrative Agent or any
Lender upon reasonable prior notice to the Borrower to discuss the affairs,
finances and condition of the Borrower or any of the Subsidiaries with the
officers thereof and

 

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independent accountants therefor (subject to reasonable requirements of
confidentiality, including requirements imposed by law or by contract);
provided, however, that unless an Event of Default shall have occurred and be
continuing, Borrower shall not be required to permit more than one such
inspection, visit or discussion in any three-month period.

SECTION 5.08. Use of Proceeds. Use the proceeds of the (x) Term Loans to
(i) finance the Transactions; (ii) pay related fees and expenses incurred in
connection with the Transactions; and (iii) provide ongoing working capital and
for other general corporate purposes of Borrower and its Subsidiaries and
(y) Revolving Facility Loans and Swingline Loans, and request the issuance of
Letters of Credit, to provide ongoing working capital and for general corporate
purposes.

SECTION 5.09. Compliance with Environmental Laws. Comply, and make reasonable
efforts to cause all lessees and other persons occupying its properties to
comply, with all Environmental Laws applicable to its operations and properties;
and obtain and renew all material authorizations and permits required pursuant
to Environmental Law for its operations and properties, in each case in
accordance with Environmental Laws, except, in each case with respect to this
Section 5.09, to the extent the failure to do so could not reasonably be
expected to have, individually or in the aggregate, a Material Adverse Effect.

SECTION 5.10. Further Assurances; Mortgages.

(a) Execute any and all further documents, financing statements, agreements and
instruments, and take all such further actions (including the filing and
recording of financing statements, fixture filings, Mortgages and other
documents and recordings of Liens in stock registries), that may be required
under any applicable law, or that the Administrative Agent may reasonably
request, to cause the Collateral and Guarantee Requirement to be and remain
satisfied, all at the expense of the Loan Parties and provide to the
Administrative Agent, from time to time upon reasonable request, evidence
reasonably satisfactory to the Administrative Agent as to the perfection and
priority of the Liens created or intended to be created by the Security
Documents.

(b) If any asset (excluding real property covered by paragraph (c) below) or
improvements thereto or any interest therein) is acquired by the Borrower or any
other Loan Party after the Closing Date or owned by an entity at the time it
becomes a Subsidiary Loan Party (in each case other than assets constituting
Collateral under a Security Document that automatically become subject to the
Lien of such Security Document upon acquisition thereof by operation of such
Security Document), promptly (and in any event within 60 days (or such later
date as the Administrative Agent (acting reasonably) may consent to)) cause such
asset to be subjected to a Lien securing the Obligations and take, and cause the
Subsidiary Loan Parties to take, such actions as shall be necessary or
reasonably requested by the Administrative Agent to grant and perfect such
Liens, including actions described in paragraph (a) of this Section, all at the
expense of the Loan Parties, subject to paragraph (g) below.

(c) Grant and cause each of the Subsidiary Loan Parties to grant to the
Administrative Agent security interests and mortgages in such real property of
the Borrower or any such Subsidiary Loan Parties, to the extent acquired after
the Closing Date and having a value at the time of acquisition in excess of $1.0
million pursuant to documentation in such form as is reasonably satisfactory to
the Administrative Agent and constituting valid and enforceable Liens subject to
no other Liens except as are permitted by Section 6.02, at the time of
perfection thereof, record or file, and cause each such Subsidiary to record or
file, the Mortgage or instruments related thereto in such manner and in such
places as is required by law to establish, perfect, preserve and protect the
Liens in favor of the Administrative Agent required to be granted pursuant to
the Mortgages and pay, and cause each such Subsidiary to pay, in full, all
Taxes, fees and other charges payable in connection therewith, in each case
subject to paragraph (g)

 

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below. Unless otherwise waived by the Administrative Agent, with respect to each
such Mortgage for real property having a value at the time of acquisition in
excess of $1.0 million, the Borrower shall deliver to the Administrative Agent
contemporaneously therewith a title insurance policy and a survey or an
affidavit of no change in accordance with clause (h) of the Collateral and
Guarantee Requirement, and the legal opinions of local U.S. counsel in the state
where such real property is located, in form and substance reasonably
satisfactory to the Administrative Agent.

(d) If any additional direct or indirect Subsidiary of the Borrower is formed or
acquired after the Closing Date and if such Subsidiary is a Subsidiary Loan
Party, within five Business Days after the date such Subsidiary is formed or
acquired, notify the Administrative Agent thereof and within 20 Business Days
after the date such Subsidiary is formed or acquired or such longer period as
the Administrative Agent shall agree, cause the Collateral and Guarantee
Requirement to be satisfied with respect to such Subsidiary and with respect to
any Equity Interest in or Indebtedness of such Subsidiary owned by or on behalf
of any Loan Party.

(e) If any Foreign Subsidiary of the Borrower is formed or acquired after the
Closing Date and if such Subsidiary is a “first tier” Foreign Subsidiary, within
five Business Days after the date such Foreign Subsidiary is formed or acquired,
notify the Administrative Agent thereof and, within 20 Business Days after the
date such Foreign Subsidiary is formed or acquired or such longer period as the
Administrative Agent shall agree, cause the Collateral and Guarantee Requirement
to be satisfied with respect to the Equity Interests in such Foreign Subsidiary
owned by or on behalf of any Loan Party.

(f) (i) Furnish to the Administrative Agent promptly ((and in any event within
30 Business Days) or such later date as the Administrative Agent may reasonably
agree to) written notice of any change (A) in any Loan Party’s corporate or
organization name, (B) in any Loan Party’s identity or organizational structure
or (C) in any Loan Party’s jurisdiction of organization and/or organizational
identification number; provided that the Borrower shall not effect or permit any
such change unless all filings have been made, or will have been made within any
statutory period, under the Uniform Commercial Code or otherwise that are
required in order for the Administrative Agent to continue at all times
following such change to have a valid, legal and perfected security interest in
all the Collateral for the benefit of the Secured Parties and (ii) promptly
notify the Administrative Agent if any material portion of the Collateral is
damaged or destroyed.

(g) The Collateral and Guarantee Requirement and the other provisions of this
Section 5.10 need not be satisfied with respect to (i) any real property held by
the Borrower or any Subsidiary as a lessee under a lease, (ii) any Equity
Interests acquired after the Closing Date in accordance with the Loan Documents
if, and to the extent that, and for so long as (A) doing so would violate
applicable law or an enforceable contractual obligation binding on such Equity
Interests that validly prohibits the creation of any other Lien on such Equity
Interests and (B) such law or obligation existed at the time of the acquisition
thereof and was not created or made binding on such Equity Interests in
contemplation of or in connection with the acquisition of such Subsidiary, and
(iii) any assets acquired after the Closing Date, to the extent that, and for so
long as, taking such actions would violate an enforceable contractual obligation
binding on such assets that validly prohibits the creation of any other Lien on
such assets, existed at the time of the acquisition thereof and was not created
or made binding on such assets in contemplation or in connection with the
acquisition of such assets (except in the case of assets acquired with
Indebtedness permitted pursuant to Section 6.01(h) that is secured by a Lien
permitted pursuant to Section 6.02(h)); provided that, upon the reasonable
request of the Administrative Agent, the Borrower shall, and shall cause any
applicable Subsidiary to, use commercially reasonable efforts to have waived or
eliminated any contractual obligation of the types described in clauses (ii) and
(iii) above.

 

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SECTION 5.11. Fiscal Year; Accounting. Cause its fiscal year to end on
December 31.

SECTION 5.12. Maintenance of Ratings. Use commercially reasonable efforts to
maintain ratings issued by Moody’s and S&P with respect to its senior secured
debt.

SECTION 5.13. Post-Closing Collateral Matters. Execute and deliver the documents
and complete the tasks set forth on Schedule 5.13 (the “Post-Closing Items”), in
each case within the time limits specified on such schedule.

ARTICLE VI

NEGATIVE COVENANTS

The Borrower covenants and agrees with each Lender that, so long as this
Agreement shall remain in effect and until the Commitments have been terminated
and the principal of and interest on each Loan, all Fees and all other expenses
or amounts payable under any Loan Document have been paid in full and all
Letters of Credit have been canceled or have expired and all amounts drawn
thereunder have been reimbursed in full, unless the Required Lenders shall
otherwise consent in writing, the Borrower will not, and will not permit any of
the Subsidiaries to:

SECTION 6.01. Indebtedness. Incur, create, assume or permit to exist any
Indebtedness, except:

(a) Indebtedness existing on the Closing Date and set forth on Schedule 6.01 and
any Permitted Refinancing Indebtedness incurred to Refinance such Indebtedness
(other than intercompany indebtedness Refinanced with Indebtedness owed to a
person not affiliated with the Borrower or any Subsidiary);

(b) Indebtedness created hereunder and under the other Loan Documents;

(c) Indebtedness of the Borrower or any Subsidiary pursuant to Swap Agreements
permitted by Section 6.13;

(d) Indebtedness owed to (including obligations in respect of letters of credit
or bank guarantees or similar instruments for the benefit of) any person
providing workers’ compensation, health, disability or other employee benefits
or property, casualty or liability insurance to the Borrower or any Subsidiary,
pursuant to reimbursement or indemnification obligations to such person;
provided that upon the incurrence of Indebtedness with respect to reimbursement
obligations regarding workers’ compensation claims, such obligations are
reimbursed not later than 30 days following such incurrence;

(e) Indebtedness of the Borrower to any Subsidiary and of any Subsidiary to the
Borrower or any other Subsidiary; provided that (i) Indebtedness of any
Subsidiary that is not a Subsidiary Loan Party to any Loan Party shall be
subject to Section 6.04(b) and (ii) Indebtedness of the Borrower to any
Subsidiary and Indebtedness of any other Loan Party to any Subsidiary that is
not a Subsidiary Loan Party shall be subordinated to the Obligations;

(f) Indebtedness in respect of performance bonds, bid bonds, appeal bonds,
surety bonds, financial assurances and completion guarantees and similar
obligations, in each case provided in the ordinary course of business, including
those incurred to secure health, safety and environmental obligations in the
ordinary course of business;

 

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(g) Indebtedness arising from the honoring by a bank or other financial
institution of a check, draft or similar instrument drawn against insufficient
funds in the ordinary course of business or other cash management services in
the ordinary course of business; provided that (x) such Indebtedness (other than
credit or purchase cards) is extinguished within 30 days of its incurrence and
(y) such Indebtedness in respect of credit or purchase cards is extinguished
within 60 days from its incurrence;

(h) Capital Lease Obligations, mortgage financings and purchase money
Indebtedness incurred by the Borrower or any Subsidiary prior to or within 270
days after the acquisition, lease or improvement of the applicable asset
permitted under this Agreement in order to finance such acquisition or
improvement, and any Permitted Refinancing Indebtedness in respect thereof, in
an aggregate principal amount that at the time of, and after giving effect to,
the incurrence thereof (together with Indebtedness outstanding pursuant to
paragraph (g) of this Section 6.01 and this paragraph (h)) would not exceed
$5.0 million;

(i) other Indebtedness of the Borrower or any Subsidiary, in an aggregate
principal amount that at the time of, and after giving effect to, the incurrence
thereof, would not exceed $5.0 million as of the end of the fiscal quarter
immediately prior to the date of such incurrence for which financial statements
have been delivered pursuant to Section 5.04;

(j) Guarantees (i) by any Loan Party of the Indebtedness of the Borrower
referred to in paragraph (i) or any Permitted Refinancing Indebtedness in
respect thereof, (ii) by the Borrower or any Subsidiary Loan Party of any
Indebtedness of the Borrower or any Subsidiary Loan Party expressly permitted to
be incurred under this Agreement, (iii) by the Borrower or any Subsidiary Loan
Party of Indebtedness otherwise expressly permitted hereunder of any Subsidiary
that is not a Subsidiary Loan Party to the extent such Guarantees are permitted
by Section 6.04(b) and (iv) by any Foreign Subsidiary of Indebtedness of another
Foreign Subsidiary; provided that, Guarantees by the Borrower or any Subsidiary
Loan Party under this Section 6.01(j) of any other Indebtedness of a person that
is subordinated to other Indebtedness of such person shall be expressly
subordinated to such other Indebtedness to the same extent;

(k) Indebtedness arising from agreements of the Borrower or any Subsidiary
providing for indemnification, adjustment of purchase or acquisition price or
similar obligations, in each case, incurred or assumed in connection with the
disposition of any business or assets of the Borrower or a Subsidiary, other
than Guarantees of Indebtedness incurred by any person acquiring all or any
portion of such business, assets or a Subsidiary for the purpose of financing
such acquisition;

(l) Indebtedness supported by a Letter of Credit, in a principal amount not in
excess of the stated amount of such Letter of Credit; provided that such
Indebtedness is promptly repaid with the proceeds of any drawing on such Letter
of Credit;

(m) Indebtedness consisting of (x) the financing of insurance premiums or
(y) take-or-pay obligations contained in supply arrangements, in each case, in
the ordinary course of business;

 

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(n) all premium (if any), interest (including post-petition interest), fees,
expenses, charges and additional or contingent interest on obligations described
in paragraphs (a) through (m) above;

(o) Cash Management Obligations and other Indebtedness in respect of netting
services, overdraft protection and similar arrangements, in each case, in
connection with cash management and deposit accounts; and

(p) the Merger Note to the extent required to be issued under the Acquisition
Agreement (as in effect on the Closing Date).

SECTION 6.02. Liens. Create, incur, assume or permit to exist any Lien on any
property or assets (including stock or other securities of any person, including
the Borrower and each Subsidiary) at the time owned by it or on any income or
revenues or rights in respect of any thereof, except:

(a) Liens on property or assets of the Borrower or any Subsidiary existing on
the Closing Date that are set forth on Schedule 6.02(a); provided that such
Liens shall secure only those obligations that they secure on the Closing Date
(and extensions, renewals and refinancings of such obligations permitted by
Section 6.01(a)) and shall not subsequently apply to any other property or
assets of the Borrower or any Subsidiary;

(b) any Lien created under the Loan Documents or permitted in respect of any
Mortgaged Property by the terms of the applicable Mortgage;

(c) Liens for Taxes, assessments or other governmental charges or levies not yet
delinquent or that are being contested in compliance with Section 5.03;

(d) landlords’, carriers’, warehousemen’s, mechanics’, materialmen’s,
repairmen’s, construction or other like Liens arising in the ordinary course of
business and securing obligations that are not overdue by more than 30 days or
that are being contested in good faith by appropriate proceedings and in respect
of which, if applicable, the Borrower and the Subsidiaries shall have set aside
on their books reserves in accordance with GAAP;

(e) (i) pledges and deposits made in the ordinary course of business in
compliance with the Federal Employers Liability Act or any other workers’
compensation, unemployment insurance and other social security laws or
regulations and deposits securing liability to insurance carriers under
insurance or self-insurance arrangements in respect of such obligations and
(ii) pledges and deposits securing liability for reimbursement or
indemnification obligations of (including obligations in respect of letters of
credit or bank guarantees for the benefit of) insurance carriers providing
property, casualty or liability insurance to the Borrower or any Subsidiary;

(f) deposits to secure the performance of bids, trade contracts (other than for
Indebtedness), leases (other than Capital Lease Obligations), statutory
obligations, surety and appeal bonds, performance and return of money bonds,
bids, leases, government contracts, trade contracts, and other obligations of a
like nature (including letters of credit in lieu of any such bonds or to support
the issuance thereof) incurred in the ordinary course of business, including
those incurred pursuant to Environmental Law in the ordinary course of business;

(g) zoning restrictions, easements, trackage rights, leases (other than Capital
Lease Obligations), licenses, special assessments, rights-of-way, restrictions
on use of real property and other similar encumbrances incurred in the ordinary
course of business that, in the aggregate, do not interfere in any material
respect with the ordinary conduct of the business of the Borrower or any
Subsidiary;

 

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(h) purchase money security interests in equipment or other property or
improvements thereto hereafter acquired (or, in the case of improvements,
constructed) by the Borrower or any Subsidiary (including the interests of
vendors and lessors under conditional sale and title retention agreements);
provided that (i) such security interests secure Indebtedness permitted by
Section 6.01(h) (including any Permitted Refinancing Indebtedness in respect
thereof), (ii) such security interests are incurred, and the Indebtedness
secured thereby is created, within 270 days after such acquisition, (iii) the
Indebtedness secured thereby does not exceed 100% of the cost of such equipment
or other property or improvements at the time of such acquisition or
construction, including transaction costs incurred by the Borrower or any
Subsidiary in connection with such acquisition and (iv) such security interests
do not apply to any other property or assets of the Borrower or any Subsidiary
(other than to accessions to such equipment or other property or improvements
but not to other parts of the property to which any such improvements are made);
provided, further, that individual financings of equipment provided by a single
lender may be cross-collateralized to other financings of equipment provided
solely by such lender;

(i) Liens arising out of capitalized lease transactions permitted under
Section 6.03, so long as such Liens attach only to the property sold and being
leased in such transaction and any accessions thereto or proceeds thereof and
related property;

(j) Liens securing judgments that do not constitute an Event of Default under
Section 7.01(j); provided that such Liens, to the extent that they secure
aggregate amounts of more than $2.0 million, shall be discharged within 60 days
of the creation thereof;

(k) Liens disclosed by any title insurance policy delivered on or subsequent to
the Closing Date and pursuant to Section 5.10, which Liens (x) are extinguished
within 30 days following the delivery of such title insurance policy, (y) do
not, in the good faith judgment of the Borrower, detract materially from the
value of the property covered by such title insurance policy or (z) are
reasonably acceptable to the Administrative Agent;

(l) any interest or title of a lessor under any leases or subleases entered into
by the Borrower or any Subsidiary in the ordinary course of business;

(m) Liens that are contractual rights of set-off (i) relating to the
establishment of depository relations with banks not given in connection with
the issuance or incurrence of Indebtedness, (ii) relating to pooled deposit or
sweep accounts of the Borrower or any Subsidiary to permit satisfaction of
overdraft or similar obligations incurred in the ordinary course of business of
the Borrower or any Subsidiary or (iii) relating to purchase orders and other
agreements entered into with customers of the Borrower or any Subsidiary in the
ordinary course of business;

(n) Liens arising solely by virtue of any statutory or common law provision
relating to banker’s liens, rights of set-off or similar rights;

(o) Liens securing obligations in respect of trade-related letters of credit
permitted under Section 6.01(f) or (k) and covering the goods (or the documents
of title in respect of such goods) financed by such letters of credit and the
proceeds and products thereof;

(p) licenses of intellectual property granted in the ordinary course of
business;

 

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(q) Liens in favor of customs and revenue authorities arising as a matter of law
to secure payment of customs duties in connection with the importation of goods;

(r) Liens solely on any cash earnest money deposits made by the Borrower or any
Subsidiary in connection with any letter of intent or purchase agreement
permitted hereunder;

(s) other Liens with respect to property or assets of the Borrower or any
Subsidiary; provided that such property and assets shall have an aggregate fair
market value (valued at the time of creation of the Liens) of not more than $3.5
million;

(t) the prior rights of consignees and their lenders under consignment
arrangements entered into in the ordinary course of business;

(u) agreements to subordinate any interest of the Borrower or any Subsidiary in
any accounts receivable or other proceeds arising from inventory consigned by
the Borrower or any of its Subsidiaries pursuant to an agreement entered into in
the ordinary course of business;

(v) Liens arising from precautionary UCC financing statements regarding
operating leases;

(w) Liens on equity interests in joint ventures held by the Borrower or a
Subsidiary securing obligations of such joint venture; and

(x) Liens on securities that are the subject of repurchase agreements
constituting Permitted Investments under clause (c) of the definition thereof.

SECTION 6.03. Sale and Lease-Back Transactions. Enter into any arrangement,
directly or indirectly, with any person whereby it shall sell or transfer any
property, real or personal, used or useful in its business, whether now owned or
hereafter acquired, and thereafter rent or lease such property or other property
that it intends to use for substantially the same purpose or purposes as the
property being sold or transferred (a “Sale and Lease-Back Transaction”).

SECTION 6.04. Investments, Loans and Advances. Purchase, hold or acquire any
Equity Interests, evidences of Indebtedness or other securities of, make or
permit to exist any loans or advances to or Guarantees of the obligations of, or
make or permit to exist any investment or any other interest in, or the
acquisition of all or any substantial part of the assets of (each, an
“Investment”), any other person, except:

(a) Investments made pursuant to the Transactions;

(b) (i) Investments by the Borrower or any Subsidiary in the Equity Interests of
the Borrower or any Subsidiary; (ii) intercompany loans from the Borrower or any
Subsidiary to the Borrower or any Subsidiary; and (iii) Guarantees by the
Borrower or any Subsidiary Loan Party of Indebtedness otherwise expressly
permitted hereunder of the Borrower or any Subsidiary; provided that any
Investment in the form of a loan or advance shall be evidenced by the
Intercompany Note and, in the case of a loan or advance by a Loan Party, pledged
by such Loan Party as Collateral pursuant to the Security Documents; provided
further that the sum of (A) Investments (valued at the time of the making
thereof and without giving effect to any write-downs or write-offs thereof)
after the Closing Date by the Loan Parties pursuant to clause (i) in
Subsidiaries that are not Subsidiary Loan Parties, plus (B) net intercompany
loans after the Closing Date to Subsidiaries that are not Subsidiary Loan
Parties pursuant to clause (ii), plus (C) Guarantees of Indebtedness

 

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after the Closing Date of Subsidiaries that are not Subsidiary Loan Parties
pursuant to clause (iii), shall not exceed an aggregate net amount equal to
$7.0 million (plus any return of capital (to the extent received by Borrower or
a Subsidiary Loan Party in cash) in respect of investments made pursuant to this
paragraph (b));

(c) Permitted Investments, or any Investments that were Permitted Investments
when made;

(d) Investments arising out of the receipt by the Borrower or any Subsidiary of
noncash consideration for the sale of assets permitted under Section 6.05;

(e) (i) loans and advances to employees or consultants of the Borrower or any
Subsidiary in the ordinary course of business not to exceed $1.0 million in the
aggregate at any time outstanding (calculated without regard to write-downs or
write-offs thereof) and (ii) advances of payroll payments and expenses to
employees in the ordinary course of business;

(f) accounts receivable, security deposits and prepayments arising and trade
credit granted in the ordinary course of business and any assets or securities
received in satisfaction or partial satisfaction thereof from financially
troubled account debtors to the extent reasonably necessary in order to prevent
or limit loss and any prepayments and other credits to suppliers made in the
ordinary course of business;

(g) Swap Agreements permitted pursuant to Section 6.13;

(h) Investments existing on, or contractually committed as of, the Closing Date
and set forth on Schedule 6.04;

(i) Investments resulting from pledges and deposits referred to in Sections
6.02(e) and (f);

(j) other Investments by the Borrower or any Subsidiary in an aggregate amount
(valued at the time of the making thereof, and without giving effect to any
write-downs or write-offs thereof) not to exceed $5.0 million (plus any returns
of capital actually received by the respective investor in respect of
investments theretofore made by it pursuant to this paragraph (j));

(k) intercompany loans between Foreign Subsidiaries and Guarantees permitted by
Section 6.01(j);

(l) Investments received in connection with the bankruptcy or reorganization of,
or settlement of delinquent accounts and disputes with or judgments against,
customers and suppliers, in each case in the ordinary course of business;

(m) acquisitions by the Borrower of obligations of one or more officers or other
employees of the Borrower or any Subsidiary in connection with such officer’s or
employee’s acquisition of Equity Interests of the Borrower, so long as no cash
or other property is (or will be or is committed to be) actually advanced by the
Borrower or such Subsidiary to any person in connection with the acquisition of
any such obligations;

(n) Guarantees by the Borrower or any Subsidiary of operating leases (other than
Capital Lease Obligations) or of other obligations that do not constitute
Indebtedness, in each case entered into by the Borrower or such Subsidiary in
the ordinary course of business; and

 

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(o) Investments made using Equity Interests of the Borrower.

SECTION 6.05. Mergers, Consolidations, Sales of Assets and Acquisitions. Merge
into or consolidate with any other person, or permit any other person to merge
into or consolidate with it, or sell, transfer, lease or otherwise dispose of
(in one transaction or in a series of transactions) all or any part of its
assets (whether now owned or hereafter acquired), or issue, sell, transfer or
otherwise dispose of any Equity Interests of the Borrower or any Subsidiary, or
purchase, lease or otherwise acquire (in one transaction or a series of
transactions) all or any substantial part of the assets of any other person,
except that this Section 6.05 shall not prohibit:

(a) (i) the purchase and sale of inventory in the ordinary course of business by
the Borrower or any Subsidiary, (ii) the acquisition or lease (pursuant to an
operating lease) of any other asset in the ordinary course of business by the
Borrower or any Subsidiary, (iii) the sale of surplus, obsolete or worn out
equipment or other property in the ordinary course of business by the Borrower
or any Subsidiary or (iv) the sale of Permitted Investments in the ordinary
course of business;

(b) if at the time thereof and immediately after giving effect thereto no Event
of Default shall have occurred and be continuing, (i) the merger of any
Subsidiary into the Borrower in a transaction in which the Borrower is the
survivor, (ii) the merger or consolidation of any Subsidiary into or with any
Subsidiary Loan Party in a transaction in which the surviving or resulting
entity is a Subsidiary Loan Party and, in the case of each of clauses (i) and
(ii), no person other than the Borrower or a Subsidiary Loan Party receives any
consideration, (iii) the merger or consolidation of any Subsidiary that is not a
Subsidiary Loan Party into or with any other Subsidiary that is not a Subsidiary
Loan Party or (iv) the liquidation or dissolution or change in form of entity of
any Subsidiary (other than the Borrower) if the Borrower determines in good
faith that such liquidation or dissolution is in the best interests of the
Borrower and is not materially disadvantageous to the Lenders;

(c) sales, transfers, leases or other dispositions to the Borrower or a
Subsidiary (upon voluntary liquidation or otherwise); provided that any sales,
transfers, leases or other dispositions by a Loan Party to a Subsidiary that is
not a Subsidiary Loan Party shall be made in compliance with Section 6.07;
provided, further, that the aggregate gross proceeds of sales, transfers, leases
or other dispositions made outside the ordinary course of business by Loan
Parties to Subsidiaries that are not Subsidiary Loan Parties in reliance upon
this paragraph (c) shall not exceed, in any fiscal year of the Borrower, $2.0
million;

(d) Sale and Lease-Back Transactions permitted by Section 6.03;

(e) Investments permitted by Section 6.04, Liens permitted by Section 6.02 and
Dividends permitted by Section 6.06;

(f) the sale of defaulted receivables in the ordinary course of business and not
as part of an accounts receivables financing transaction;

(g) sales, transfers, leases or other dispositions of assets not otherwise
permitted by this Section 6.05; provided that the aggregate gross proceeds
(including noncash proceeds) of any or all assets sold, transferred, leased or
otherwise disposed of in reliance upon this paragraph (g) shall not exceed, in
any fiscal year of the Borrower, $3.5 million; provided, further, that the Net
Proceeds thereof are applied in accordance with Section 2.11(b);

 

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(h) licensing and cross-licensing arrangements involving any technology or other
intellectual property of the Borrower or any Subsidiary in the ordinary course
of business; and

(i) sales, leases or other dispositions of inventory of the Borrower and the
Subsidiaries determined by the management of the Borrower to be no longer useful
or necessary in the operation of the business of the Borrower and the
Subsidiaries.

Notwithstanding anything to the contrary contained in this Section 6.05 above,
(i) no sale, transfer or other disposition of assets shall be permitted by this
Section 6.05 (other than (A) sales, transfers, leases or other dispositions to
Loan Parties pursuant to paragraph (c) hereof and (B) sales of surplus, obsolete
or worn out equipment or other property in the ordinary course of business by
the Borrower or any Subsidiary pursuant to clause (a)(iii) hereof) unless such
disposition is for fair market value, (ii) no sale, transfer or other
disposition of assets shall be permitted by paragraph (a) or (d) of this
Section 6.05 unless such disposition is for at least 75% cash consideration and
(iii) no sale, transfer or other disposition of assets shall be permitted by
paragraph (g) of this Section 6.05 unless such disposition is for at least 75%
cash consideration.

SECTION 6.06. Dividends and Distributions. Declare or pay, directly or
indirectly, any dividend or make any other distribution (by reduction of capital
or otherwise), whether in cash, property, securities or a combination thereof,
with respect to any of its Equity Interests (other than dividends and
distributions on Equity Interests payable solely by the issuance of additional
Qualified Capital Stock of the person paying such dividends or distributions) or
directly or indirectly redeem, purchase, retire or otherwise acquire for value
(or permit any Subsidiary to purchase or acquire) any of its Equity Interests or
set aside any amount for any such purpose (other than through the issuance of
additional Qualified Capital Stock of the person redeeming, purchasing, retiring
or acquiring such shares); provided, however, that:

(a) any Subsidiary may declare and pay dividends to, repurchase its Equity
Interests from or make other distributions to the Borrower or to any Wholly
Owned Subsidiary of the Borrower (or, in the case of non-Wholly Owned
Subsidiaries, to the Borrower or any Subsidiary that is a direct or indirect
parent of such Subsidiary and to each other owner of Equity Interests of such
Subsidiary on a pro rata basis (or more favorable basis from the perspective of
the Borrower or such Subsidiary) based on their relative ownership interests);

(b) the Borrower may purchase or redeem the Equity Interests of the Borrower
(including related stock appreciation rights or similar securities) held by then
present or former directors, consultants, officers or employees of the Borrower
or any Subsidiary or by any Plan upon such person’s death, disability,
retirement or termination of employment or under the terms of any such Plan or
any other agreement under which such shares of stock or related rights were
issued, provided that the aggregate amount of such purchases or redemptions
under this paragraph (b) shall not exceed in any fiscal year $2.0 million (plus
the amount of net proceeds (x) received by the Borrower during such calendar
year from sales of Equity Interests of the Borrower to directors, consultants,
officers or employees of the Borrower or any Subsidiary in connection with
permitted employee compensation and incentive arrangements and (y) of any
key-man life insurance policies received during such calendar year), which, if
not used in any year, may be carried forward to any subsequent calendar year;
and

(c) noncash repurchases of Equity Interests deemed to occur upon exercise of
stock options if such Equity Interests represent a portion of the exercise price
of such options.

 

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SECTION 6.07. Transactions with Affiliates.

(a) Sell or transfer any property or assets to, or purchase or acquire any
property or assets from, or otherwise engage in any other transaction with, any
of its Affiliates or any direct or indirect holder of 10% or more of any class
of capital stock of the Borrower, unless such transaction is (i) otherwise
permitted (or required) under this Agreement or (ii) upon terms no less
favorable to the Borrower or such Subsidiary, as applicable, than would be
obtained in a comparable arm’s-length transaction with a person that is not an
Affiliate; provided that this clause (ii) shall not apply to the indemnification
of directors of the Borrower and each Subsidiary in accordance with customary
practice.

(b) The foregoing paragraph (a) shall not prohibit, to the extent not otherwise
prohibited under the Loan Documents,

(i) any issuance of securities, or other payments, awards or grants in cash,
securities or otherwise pursuant to, or the funding of, employment arrangements,
stock options and stock ownership plans approved by the board of directors of
the Borrower,

(ii) loans or advances to employees or consultants of the Borrower or any
Subsidiary in accordance with Section 6.04(e),

(iii) transactions among the Borrower and the Subsidiary Loan Parties and
transactions among the Subsidiary Loan Parties otherwise permitted by this
Agreement,

(iv) the payment of fees and indemnities to directors, officers, consultants and
employees of the Borrower or any Subsidiary in the ordinary course of business,

(v) transactions pursuant (i) to the Transaction Documents, as amended or
modified in accordance with the Loan Documents and (ii) permitted agreements in
existence on the Closing Date and set forth on Schedule 6.07 or any amendment
thereto to the extent such amendment is not adverse to the Lenders in any
material respect,

(vi) (A) any employment agreements entered into by the Borrower or any
Subsidiary in the ordinary course of business, (B) any subscription agreement or
similar agreement pertaining to the repurchase of Equity Interests pursuant to
put/call rights or similar rights with employees, officers or directors, and
(C) any employee compensation, benefit plan or arrangement, any health,
disability or similar insurance plan which covers employees, and any reasonable
employment contract and transactions pursuant thereto,

(vii) dividends, redemptions and repurchases permitted under Section 6.06,

(viii) transactions with Wholly Owned Subsidiaries for the purchase or sale of
goods, products, parts and services entered into in the ordinary course of
business in a manner consistent with past practice,

(ix) any transaction in respect of which the Borrower delivers to the
Administrative Agent a letter addressed to the board of directors of the
Borrower from an accounting, appraisal or investment banking firm, in each case
of nationally recognized standing that is (A) in the good faith determination of
the Borrower qualified to render such letter and (B) reasonably satisfactory to
the Administrative Agent, which letter states that such transaction is on terms
that are no less favorable to the Borrower or such Subsidiary, as applicable,
than would be obtained in a comparable arm’s-length transaction with a person
that is not an Affiliate, or

 

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(x) transactions with joint ventures for the purchase or sale of goods,
equipment and services entered into in the ordinary course of business and in a
manner consistent with past practice.

SECTION 6.08. Business of the Borrower and the Subsidiaries. Notwithstanding any
other provisions hereof, engage at any time in any business or business activity
other than any business or business activity conducted by any of them on the
Closing Date and any business or business activities incidental or related
thereto, or any business or activity that is reasonably similar thereto or a
reasonable extension, development or expansion thereof or ancillary thereto.

SECTION 6.09. Limitation on Modifications of Indebtedness; Modifications of
Certificate of Incorporation, By-Laws and Certain Other Agreements; etc.

(a) Amend or modify in any manner materially adverse to the Lenders, or grant
any waiver or release under or terminate in any manner (if such granting or
termination shall be materially adverse to the Lenders), the articles or
certificate of incorporation or by-laws or limited liability company operating
agreement of the Borrower or any Subsidiary or the Acquisition Agreement.

(b) (i) Make, or agree or offer to pay or make, directly or indirectly, any
payment or other distribution (whether in cash, securities or other property) of
or in respect of principal of or interest on the Merger Note, any other
Subordinated Debt, or any Permitted Refinancing Indebtedness in respect of any
of the foregoing Indebtedness, or any payment or other distribution (whether in
cash, securities or other property), including any sinking fund or similar
deposit, on account of the purchase, redemption, retirement, acquisition,
cancellation or termination of the Merger Note, any other Subordinated Debt, or
any Permitted Refinancing Indebtedness in respect thereof (except for payments
of regularly scheduled interest paid solely in kind by increasing the principal
amount of the Merger Note by the amount of such accrued interest then owing); or

(ii) Amend or modify, or permit the amendment or modification of, any provision
of the Merger Note, any other Subordinated Debt, or any Permitted Refinancing
Indebtedness in respect thereof, or any agreement (including any document
relating to the Merger Note, any other Subordinated Debt, or any Permitted
Refinancing Indebtedness in respect thereof) relating thereto, other than
amendments or modifications that are not in any manner materially adverse to
Lenders and that do not affect the subordination provisions thereof (if any) in
a manner adverse to the Lenders.

(c) Permit any Subsidiary to enter into, or suffer to exist or become effective,
any agreement or instrument that by its terms restricts (i) the payment of
dividends or distributions or the making of cash advances to the Borrower or any
Subsidiary that is a direct or indirect parent of any Subsidiary or (ii) the
granting of Liens pursuant to the Security Documents, in each case other than
those arising under any Loan Document, except, in each case, restrictions
existing by reason of:

(A) restrictions imposed by applicable law;

(B) contractual encumbrances or restrictions in effect on the Closing Date or
any agreements related to any permitted renewal, extension or refinancing of any
Indebtedness existing on the Closing Date that does not expand the scope of any
such encumbrance or restriction;

(C) any restriction on a Subsidiary imposed pursuant to an agreement entered
into for the sale or disposition of all or substantially all the Equity
Interests or assets of a Subsidiary pending the closing of such sale or
disposition;

 

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(D) customary provisions in joint venture agreements and other similar
agreements applicable to joint ventures entered into in the ordinary course of
business;

(E) any restrictions imposed by any agreement relating to secured Indebtedness
permitted by this Agreement to the extent that such restrictions apply only to
the property or assets securing such Indebtedness;

(F) customary provisions contained in leases or licenses of intellectual
property and other similar agreements entered into in the ordinary course of
business;

(G) customary provisions restricting subletting or assignment of any lease
governing a leasehold interest;

(H) customary provisions restricting assignment of any agreement entered into in
the ordinary course of business;

(I) customary restrictions and conditions contained in any agreement relating to
the sale of any asset permitted under Section 6.05 pending the consummation of
such sale;

(J) customary restrictions and conditions contained in the document relating to
any Lien, so long as (1) such Lien is permitted under Section 6.02 and such
restrictions or conditions relate only to the specific asset subject to such
Lien, and (2) such restrictions and conditions are not created for the purpose
of avoiding the restrictions imposed by this Section 6.09;

(K) customary net worth provisions contained in real property leases entered
into by Subsidiary, so long as the Borrower has determined in good faith that
such net worth provisions could not reasonably be expected to impair the ability
of the Borrower and the Subsidiaries to meet their ongoing obligations; and

(L) any agreement in effect at the time such subsidiary becomes a Subsidiary, so
long as such agreement was not entered into in contemplation of such person
becoming a Subsidiary.

SECTION 6.10. Maximum Capital Expenditures.

(a) The Borrower will not, nor will it permit any Subsidiary to, incur or make
any Capital Expenditures, during any period set forth below, in excess of the
amount set forth opposite such period below:

 

Period

   Amount (in millions)

Closing Date     - December 31, 2006

   $ 5,000,000

January 1, 2007 - December 31, 2007

   $ 12,000,000

January 1, 2008 - December 31, 2008

   $ 15,000,000

January 1, 2009 - December 31, 2009

   $ 15,000,000

January 1, 2010 - December 31, 2010

   $ 17,500,000

January 1, 2011 - December 31, 2011

   $ 20,000,000

 

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Period

   Amount (in millions)

January 1, 2012 - December 31, 2012

   $ 20,000,000

January 1, 2013 - August 31, 2013

   $ 15,000,000

(b) The amount of Capital Expenditures permitted to be made pursuant to clause
(a) above in respect of any fiscal year shall be increased by the unused amount
of Capital Expenditures that were permitted to be made in prior fiscal years
pursuant to clause (a) above. Capital Expenditures in any fiscal year shall be
deemed to use, first, any amount carried forward to such fiscal year pursuant to
this clause (b), and second, the amount for such fiscal year set forth in clause
(a) above.

SECTION 6.11. Interest Coverage Ratio. Permit the ratio (the “Interest Coverage
Ratio”) of (a) EBITDA to (b) Interest Expense for the four quarter period ending
on the last day of any fiscal quarter occurring during any period set forth in
the table below to be less than the ratio set forth opposite such period in the
table below:

 

Period

   Interest
Coverage Ratio

Closing Date     - December 31, 2006

   2.25 to 1.00

January 1, 2007 - June 30, 2007

   2.50 to 1.00

July 1, 2007        - December 31, 2007

   3.00 to 1.00

January 1, 2008 - December 31, 2008

   3.25 to 1.00

January 1, 2009 - December 31, 2009

   3.50 to 1.00

January 1, 2010 and thereafter

   4.00 to 1.00

; provided that the Interest Coverage Ratio shall be determined for the relevant
Test Period on a Pro Forma Basis.

 

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SECTION 6.12. Consolidated Leverage Ratio. Permit the Consolidated Leverage
Ratio on the last day of any fiscal quarter occurring in any period set forth
below to exceed of the ratio set forth below for such period:

 

Period

  

Consolidated

Leverage Ratio

Closing Date      – December 31, 2006

   4.75 to 1.00

January 1, 2007 – June 30, 2007

   4.00 to 1.00

July 1, 2007        – December 31, 2007

   3.50 to 1.00

January 1, 2008 – December 31, 2008

   2.50 to 1.00

January 1, 2009 – December 31, 2009

   2.25 to 1.00

January 1, 2010 and thereafter

   2.00 to 1.00

SECTION 6.13. Swap Agreements. Enter into any Swap Agreement, other than
(a) Swap Agreements entered into in the ordinary course of business to hedge or
mitigate risks to which the Borrower or any Subsidiary is exposed in the conduct
of its business or the management of its liabilities (including, without
limitation, raw material, supply costs and currency risks) and (b) Swap
Agreements entered into in order to effectively cap, collar or exchange interest
rates (from fixed to floating rates, from one floating rate to another floating
rate or otherwise) with respect to any interest-bearing liability or investment
of the Borrower or any Subsidiary.

ARTICLE VII

EVENTS OF DEFAULT

SECTION 7.01. Events of Default. In case of the happening of any of the
following events (each, an “Event of Default”):

(a) any representation or warranty made or deemed made by the Borrower or any
other Loan Party in any Loan Document, or any representation, warranty,
statement or information contained in any report, certificate, financial
statement or other instrument furnished in connection with or pursuant to any
Loan Document, shall prove to have been false or misleading in any material
respect when so made, deemed made or furnished by the Borrower or any other Loan
Party;

(b) default shall be made in the payment of any principal of any Loan or the
reimbursement with respect to any L/C Disbursement when and as the same shall
become due and payable, whether at the due date thereof or at a date fixed for
prepayment thereof or by acceleration thereof or otherwise;

(c) default shall be made in the payment of any interest on any Loan or on any
L/C Disbursement or in the payment of any Fee or any other amount (other than an
amount referred to in (b) above) due under any Loan Document, when and as the
same shall become due and payable, and such default shall continue unremedied
for a period of five Business Days;

(d) default shall be made in the due observance or performance by the Borrower
or any Subsidiary of any covenant, condition or agreement contained in
Section 5.01(a), 5.05(a), 5.08 or in Article VI;

 

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(e) default shall be made in the due observance or performance by the Borrower
or any Subsidiary of any covenant, condition or agreement contained in any Loan
Document (other than those specified in paragraphs (b), (c) and (d) above) and
such default shall continue unremedied for a period of 30 days after notice
thereof from the Administrative Agent or the Required Lenders to the Borrower;

(f) (i) any event or condition occurs that (A) results in any Material
Indebtedness or the Merger Note becoming due prior to its scheduled maturity or
(B) enables or permits (with all applicable grace periods having expired) the
holder or holders of any Material Indebtedness or the Merger Note or any trustee
or agent on its or their behalf to cause any Material Indebtedness or the Merger
Note to become due, or to require the prepayment, repurchase, redemption or
defeasance thereof, prior to its scheduled maturity or (ii) the Borrower or any
Subsidiary shall fail to pay the principal of any Material Indebtedness or the
Merger Note at the stated final maturity thereof; provided that this clause
(f) shall not apply to secured Indebtedness that becomes due as a result of the
voluntary sale or transfer of the property or assets securing such Indebtedness
if such sale or transfer is permitted hereunder and under the documents
providing for such Indebtedness, and such Indebtedness is promptly repaid in
full following the consummation of such sale or transfer;

(g) there shall have occurred a Change in Control;

(h) an involuntary proceeding shall be commenced or an involuntary petition
shall be filed in a court of competent jurisdiction seeking (i) relief in
respect of the Borrower or any Subsidiary, or of a substantial part of the
property or assets of the Borrower or any Subsidiary, under Title 11 of the
United States Code, as now constituted or hereafter amended, or any other
federal, state or foreign bankruptcy, insolvency, receivership or similar law,
(ii) the appointment of a receiver, trustee, custodian, sequestrator,
conservator or similar official for the Borrower or any Subsidiary or for a
substantial part of the property or assets of the Borrower or any Subsidiary or
(iii) the winding-up or liquidation of the Borrower or any Subsidiary (except,
in the case of any Subsidiary, in a transaction permitted by Section 6.05); and
such proceeding or petition shall continue undismissed for 60 days or an order
or decree approving or ordering any of the foregoing shall be entered;

(i) The Borrower or any Subsidiary shall (i) voluntarily commence any proceeding
or file any petition seeking relief under Title 11 of the United States Code, as
now constituted or hereafter amended, or any other federal, state or foreign
bankruptcy, insolvency, receivership or similar law, (ii) consent to the
institution of, or fail to contest in a timely and appropriate manner, any
proceeding or the filing of any petition described in paragraph (h) above,
(iii) apply for or consent to the appointment of a receiver, trustee, custodian,
sequestrator, conservator or similar official for the Borrower or any Subsidiary
or for a substantial part of the property or assets of the Borrower or any
Subsidiary, (iv) file an answer admitting the material allegations of a petition
filed against it in any such proceeding, (v) make a general assignment for the
benefit of creditors or (vi) become unable or admit in writing its inability or
fail generally to pay its debts as they become due;

(j) the failure by the Borrower or any Subsidiary to pay one or more final
judgments aggregating in excess of $10 million (to the extent not covered by
insurance), which judgments are not discharged or effectively waived or stayed
or bonded pending appeal for a period of 30 consecutive days, or any action
shall be legally taken by a judgment creditor to levy upon assets or properties
of the Borrower or any Subsidiary to enforce any such judgment;

 

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(k) (i) a Reportable Event or Reportable Events shall have occurred with respect
to any Plan or a trustee shall be appointed by a United States district court to
administer any Plan, (ii) the PBGC or a plan administrator shall institute
proceedings (including giving notice of intent thereof) to terminate any Plan or
Plans, (iii) the Borrower or any Subsidiary or any ERISA Affiliate shall have
been notified by the sponsor of a Multiemployer Plan that it has incurred or
will be assessed Withdrawal Liability to such Multiemployer Plan and such person
does not have reasonable grounds for contesting such Withdrawal Liability or is
not contesting such Withdrawal Liability in a timely and appropriate manner,
(iv) the Borrower or any Subsidiary or any ERISA Affiliate shall have been
notified by the sponsor of a Multiemployer Plan that such Multiemployer Plan is
in reorganization or is being terminated, within the meaning of Title IV of
ERISA, (v) the Borrower or any Subsidiary shall engage in any “prohibited
transaction” (as defined in Section 406 of ERISA or Section 4975 of the Code)
involving any Plan or (vi) a termination of, withdrawal from, or noncompliance
with applicable law or plan terms with respect, to Foreign Plans shall have
occurred; and in each case in clauses (i) through (vi) above, such event or
condition, together with all other such events or conditions, if any, could
reasonably be expected to have a Material Adverse Effect; or

(l) (i) any Loan Document shall for any reason be asserted in writing by the
Borrower or any Subsidiary not to be a legal, valid and binding obligation of
any party thereto, (ii) any security interest purported to be created by any
Security Document and to extend to assets that are a substantial portion of the
assets of the Borrower and the Subsidiaries on a consolidated basis shall cease
to be, or shall be asserted in writing by the Borrower or any other Loan Party
not to be, a valid and perfected security interest (perfected as or having the
priority required by this Agreement or the relevant Security Document and
subject to such limitations and restrictions as are set forth herein and
therein) in such assets, (iii) the Guarantees pursuant to the Collateral
Agreement by any Subsidiary Loan Party of any of the Obligations shall cease to
be in full force and effect (other than in accordance with the terms thereof),
or shall be asserted in writing by the Borrower or any Subsidiary Loan Party not
to be in effect or not to be legal, valid and binding obligations or (iv) the
Obligations of the Borrower or the Guarantees pursuant to the Security Documents
by the Borrower or the Subsidiary Loan Party shall be invalidated or otherwise
cease, or shall be asserted in writing by the Borrower or any Subsidiary Loan
Party to be invalid or to cease to be legal, valid and binding obligations of
the parties thereto, enforceable in accordance with their terms;

then, and in every such event (other than an event with respect to the Borrower
described in paragraph (h) or (i) above), and at any time thereafter during the
continuance of such event, the Administrative Agent may, and at the request of
the Required Lenders shall, upon notice to the Borrower, take any or all of the
following actions, at the same or different times: (i) terminate forthwith the
Commitments, (ii) declare the Loans then outstanding to be forthwith due and
payable in whole or in part, whereupon the principal of the Loans so declared to
be due and payable, together with accrued interest thereon and any unpaid
accrued Fees and all other liabilities of the Borrower accrued hereunder and
under any other Loan Document, shall become forthwith due and payable, without
presentment, demand, protest or any other notice of any kind, all of which are
hereby expressly waived by the Borrower, anything contained herein or in any
other Loan Document to the contrary notwithstanding and (iii) if the Loans have
been declared due and payable pursuant to clause (ii) above, demand cash
collateral pursuant to Section 2.05(j); and in any event with respect to the
Borrower described in paragraph (h) or (i) above, the Commitments shall
automatically terminate, the principal of the Loans then outstanding, together
with accrued interest thereon and any unpaid accrued Fees and all other
liabilities of the Borrower accrued hereunder and under any other Loan Document,
shall automatically become due and payable and the Administrative Agent shall be
deemed to have made a demand for cash collateral to the full extent permitted
under Section 2.05(j),

 

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without presentment, demand, protest or any other notice of any kind, all of
which are hereby expressly waived by the Borrower, anything contained herein or
in any other Loan Document to the contrary notwithstanding.

SECTION 7.02. Borrower’s Right to Cure.

(a) Notwithstanding anything to the contrary contained in Section 7.01, in the
event that the Borrower fails to comply with the requirements of any Financial
Performance Covenant, until the expiration of the 10th day subsequent to the
date the certificate calculating such Financial Performance Covenant is required
to be delivered pursuant to Section 5.04(c), the Borrower shall have the right
to issue Permitted Cure Securities for cash or otherwise receive cash
contributions (collectively, the “Cure Right”), and upon the receipt by the
Borrower of such cash (the “Cure Amount”) pursuant to the exercise of such Cure
Right such Financial Performance Covenant shall be recalculated giving effect to
the following pro forma adjustments:

(i) EBITDA shall be increased, solely for the purpose of measuring the Financial
Performance Covenants and not for any other purpose under this Agreement, by an
amount equal to the Cure Amount; and

(ii) If, after giving effect to the foregoing recalculations, the Borrower shall
then be in compliance with the requirements of all Financial Performance
Covenants, the Borrower shall be deemed to have satisfied the requirements of
the Financial Performance Covenants as of the relevant date of determination
with the same effect as though there had been no failure to comply therewith at
such date, and the applicable breach or default of the Financial Performance
Covenants that had occurred shall be deemed cured for the purposes of this
Agreement.

(b) Notwithstanding anything herein to the contrary, (i) in each
four-fiscal-quarter period there shall be at least one fiscal quarter in which
the Cure Right is not exercised, (ii) in each eight-fiscal-quarter period, there
shall be at least four fiscal quarters during which the Cure Right is not
exercised and (iii) for purposes of this Section 7.02, the Cure Amount shall be
no greater than the amount required for purposes of complying with the Financial
Performance Covenants.

SECTION 7.03. Exclusion of Immaterial Subsidiaries. Solely for the purposes of
determining whether a Default has occurred under clause (h) or (i) of
Section 7.01, any reference in any such clause to any Subsidiary shall be deemed
not to include any Subsidiary affected by any event or circumstance referred to
in any such clause that did not, as of the last day of the fiscal quarter of the
Borrower most recently ended, have assets with a value in excess of 5% of the
Consolidated Total Assets or 5% of total revenues of the Borrower and the
Subsidiaries as of such date; provided that if it is necessary to exclude more
than one Subsidiary from clause (h) or (i) of Section 7.01 pursuant to this
Section 7.03 in order to avoid a Default thereunder, all excluded Subsidiaries
shall be considered to be a single consolidated Subsidiary for purposes of
determining whether the condition specified above is satisfied.

ARTICLE VIII

THE AGENTS

SECTION 8.01. Appointment. Each Lender hereby irrevocably designates and
appoints the Administrative Agent as the agent of such Person under this
Agreement and the other Loan Documents, and each such Person irrevocably
authorizes the Administrative Agent, in such capacity, to take such action on
its behalf under the provisions of this Agreement and the other Loan Documents
and to exercise such powers and perform such duties as are expressly delegated
to the Administrative Agent

 

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by the terms of this Agreement and the other Loan Documents, together with such
other powers as are reasonably incidental thereto. Notwithstanding any provision
to the contrary elsewhere in this Agreement, the Administrative Agent shall not
have any duties or responsibilities, except those expressly set forth herein, or
any fiduciary relationship with any Person, and no implied covenants, functions,
responsibilities, duties, obligations or liabilities shall be read into this
Agreement or any other Loan Document or otherwise exist against the
Administrative Agent. The Administrative Agent is hereby expressly authorized by
the Lenders, without hereby limiting any implied authority, (a) to receive on
behalf of the Lenders all payments of principal of and interest on the Loans,
all payments and all other amounts due to the Lenders hereunder, and promptly to
distribute to each Lender its proper share of each payment so received; (b) to
give notice on behalf of each of the Lenders to Borrower of any Default
specified in this Agreement of which the Administrative Agent has actual
knowledge acquired in connection with its agency hereunder; and (c) to
distribute to each Lender copies of all notices, financial statements and other
materials delivered by or on behalf of Borrower or any other Loan Party pursuant
to this Agreement as received by such Agent.

SECTION 8.02. Delegation of Duties. The Administrative Agent may execute any and
all duties hereunder by or through any of its Related Parties or any sub-agent
appointed by it and shall be entitled to rely upon the advice of legal counsel
selected by it with respect to all matters arising hereunder and shall not be
liable for any action taken or suffered in good faith by it in accordance with
the advice of such counsel.

SECTION 8.03. Exculpatory Provisions. None of the Agents nor any of their
Related Parties shall be liable to the Lenders as such for any action taken or
omitted to be taken by any of them except to the extent finally judicially
determined to have resulted from its or his or her own gross negligence or
willful misconduct, or be responsible for any statement, warranty or
representation herein or the contents of any document delivered in connection
herewith, or be required to ascertain or to make any inquiry concerning the
performance or observance by any Loan Party of any of the terms, conditions,
covenants or agreements contained in any Loan Document. The Agents shall not be
responsible to the Lenders for the due execution, genuineness, validity,
enforceability or effectiveness of this Agreement or any other Loan Documents or
other instruments or agreements. Each Agent shall in all cases be fully
protected in acting, or refraining from acting, in accordance with written
instructions signed by the Required Lenders (or such other proportion of the
Lenders as may be expressly required hereby) and, except as otherwise
specifically provided herein, such instructions and any action or inaction
pursuant thereto shall be binding on all the Lenders.

SECTION 8.04. Reliance by Agents. Each Agent shall, in the absence of actual
knowledge to the contrary, be entitled to rely on any instrument or document
believed by it in good faith to be genuine and correct and to have been signed
or sent by the proper person or persons. None of the Agents nor any of their
Related Parties shall have any responsibility to the Loan Parties on account of
the failure of or delay in performance or breach by any Lender of any of its
obligations hereunder or to any Lender on account of the failure of or delay in
performance or breach by any other Lender or the Loan Parties of any of their
respective obligations hereunder or under any other Loan Document or in
connection herewith or therewith. The Lenders hereby acknowledge that no Agent
shall be under any duty to take any discretionary action permitted to be taken
by it pursuant to the provisions of any Loan Document unless it shall be
requested in writing to do so by the Required Lenders (or such other proportion
of the Lenders as may be expressly required hereby).

SECTION 8.05. Notice of Default. The Administrative Agent shall not be deemed to
have knowledge or notice of the occurrence of any Default or Event of Default
unless the Administrative Agent has received notice from a Lender or the
Borrower referring to this Agreement, describing such

 

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Default or Event of Default and stating that such notice is a “notice of
default”. In the event that the Administrative Agent receives such a notice, the
Administrative Agent shall give notice thereof to the Lenders. The
Administrative Agent shall take such action with respect to such Default or
Event of Default as shall be reasonably directed by the Required Lenders (or, if
so specified by this Agreement, all Lenders); provided that unless and until the
Administrative Agent shall have received such directions, the Administrative
Agent may (but shall not be obligated to) take such action, or refrain from
taking such action, with respect to such Default or Event of Default as it shall
deem advisable in the best interests of the Lenders.

SECTION 8.06. Non-Reliance on Agents and Other Lenders. Each Lender expressly
acknowledges that neither the Agents nor any of their respective officers,
directors, employees, agents, attorneys-in-fact or affiliates have made any
representations or warranties to it and that no act by any Agent hereafter
taken, including any review of the affairs of a Loan Party or any affiliate of a
Loan Party, shall be deemed to constitute any representation or warranty by any
Agent to any Lender. Each Lender represents to the Agents that it has,
independently and without reliance upon any Agent or any other Lender, and based
on such documents and information as it has deemed appropriate, made its own
appraisal of and investigation into the business, operations, property,
financial and other condition and creditworthiness of the Loan Parties and their
affiliates and made its own decision to make its Loans hereunder and enter into
this Agreement. Each Lender also represents that it will, independently and
without reliance upon any Agent or any other Lender, and based on such documents
and information as it shall deem appropriate at the time, continue to make its
own credit analysis, appraisals and decisions in taking or not taking action
under this Agreement and the other Loan Documents, and to make such
investigation as it deems necessary to inform itself as to the business,
operations, property, financial and other condition and creditworthiness of the
Loan Parties and their affiliates. Except for notices, reports and other
documents expressly required to be furnished to the Lenders by the
Administrative Agent hereunder, the Administrative Agent shall not have any duty
or responsibility to provide any Lender with any credit or other information
concerning the business, operations, property, condition (financial or
otherwise), prospects or creditworthiness of any Loan Party or any affiliate of
a Loan Party that may come into the possession of the Administrative Agent or
any of its officers, directors, employees, agents, attorneys-in-fact or
affiliates.

SECTION 8.07. Indemnification. The Lenders agree to indemnify each Agent in its
capacity as such (to the extent not reimbursed by the Borrower and without
limiting the obligation of the Borrower to do so), each in an amount equal to
its pro rata share (based on its Commitments hereunder (or if such Commitments
shall have expired or been terminated, in accordance with the respective
principal amounts of its applicable outstanding Loans or participations in L/C
Disbursements, as applicable)) thereof, from and against any and all
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements of any kind whatsoever that may at any time
(whether before or after the payment of the Loans) be imposed on, incurred by or
asserted against such Agent in any way relating to or arising out of, the
Commitments, this Agreement, any of the other Loan Documents or any documents
contemplated by or referred to herein or therein or the transactions
contemplated hereby or thereby or any action taken or omitted by such Agent
under or in connection with any of the foregoing; provided that no Lender shall
be liable for the payment of any portion of such liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, costs, expenses or
disbursements that are found by a final and nonappealable decision of a court of
competent jurisdiction to have resulted from such Agent’s gross negligence or
willful misconduct. The agreements in this Section shall survive the payment of
the Loans and all other amounts payable hereunder.

SECTION 8.08. Agent in Its Individual Capacity. Each Agent and its affiliates
may make loans to, accept deposits from and generally engage in any kind of
business with any Loan Party as though such Agent were not an Agent. With
respect to its Loans made or renewed by it and with respect

 

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to any Letter of Credit issued or participated in by it, each Agent shall have
the same rights and powers under this Agreement and the other Loan Documents as
any Lender and may exercise the same as though it were not an Agent, and the
terms “Lender” and “Lenders” shall include each Agent in its individual
capacity.

SECTION 8.09. Successor Administrative Agents. Subject to the appointment and
acceptance of a successor Agent as provided below, the Administrative Agent may
resign as Administrative Agent at any time by notifying the Lenders, the Issuing
Bank and Borrower. Upon any such resignation, the Required Lenders shall have
the right to appoint a successor, subject (so long as no Default or Event of
Default is continuing) to Borrower’s approval (not to be unreasonably withheld
or delayed). If no successor shall have been so appointed by the Requisite
Lenders and approved by Borrower and shall have accepted such appointment within
30 days after the retiring Administrative Agent gives notice of its resignation,
then the retiring Administrative Agent may, on behalf of the Lenders and the
Issuing Bank, appoint a successor Administrative Agent which shall be a bank or
financial institution with an office in New York, New York, having a combined
capital and surplus of at least $500,000,000 or an Affiliate of any such bank or
financial institution. Upon the acceptance of any appointment as an
Administrative Agent hereunder by such a successor bank, such successor shall
succeed to and become vested with all the rights, powers, privileges and duties
of the retiring Administrative Agent and the retiring Administrative Agent shall
be discharged from its duties and obligations hereunder. After the
Administrative Agent’s resignation hereunder, the provisions of this Article
VIII shall continue in effect for its benefit in respect of any actions taken or
omitted to be taken by it while it was acting as the Administrative Agent.

SECTION 8.10. Syndication Agent. The Syndication Agent shall not have any duties
or responsibilities hereunder in its capacity as such.

ARTICLE IX

MISCELLANEOUS

SECTION 9.01. Notices.

(a) Notices and other communications provided for herein shall be in writing and
shall be delivered by hand or overnight courier service, mailed by certified or
registered mail or sent by telecopy, as follows:

(i) if to any Loan Party, to Timothy Steinkopf, 4810 Harwood Road, San Jose, CA
95124, and Mary Budge, Esq., 2340 Energy Park Drive, St. Paul, MN 55108, with a
copy to Heller Ehrman LLP, 333 Bush Street, San Francisco, CA 94104, Attention
of Jim Olson, Esq. (Telecopy No. (415) 772-6268);

(ii) if to the Administrative Agent, to Citicorp USA, Inc., 390 Greenwich
Street., New York, New York 10013, Attention of Hector Guenther (Telecopy No.
(646) 291-1650), with a copy to Cahill Gordon & Reindel llp, 80 Pine Street, New
York, New York 10005, Attention of Adam Dworkin (Telecopy No. (212) 378-2432);
and

(iii) if to an Issuing Bank, to it at the address or telecopy number set forth
separately in writing.

(b) Notices and other communications to the Lenders hereunder may be delivered
or furnished by electronic communications pursuant to procedures approved by the
Administrative Agent; provided that the foregoing shall not apply to notices
pursuant to Article II unless otherwise agreed by the

 

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Administrative Agent and the applicable Lender. Each of the Administrative Agent
and the Borrower may, in its discretion, agree to accept notices and other
communications to it hereunder by electronic communications pursuant to
procedures approved by it; provided, further, that approval of such procedures
may be limited to particular notices or communications.

(c) All notices and other communications given to any party hereto in accordance
with the provisions of this Agreement shall be deemed to have been given on the
date of receipt if delivered by hand or overnight courier service, sent by
telecopy or (to the extent permitted by paragraph (b) above) electronic means or
on the date five Business Days after dispatch by certified or registered mail if
mailed, in each case delivered, sent or mailed (properly addressed) to such
party as provided in this Section 9.01 or in accordance with the latest
unrevoked direction from such party given in accordance with this Section 9.01.

(d) Any party hereto may change its address or telecopy number for notices and
other communications hereunder by notice to the other parties hereto.

SECTION 9.02. Survival of Agreement. All covenants, agreements, representations
and warranties made by the Loan Parties herein, in the other Loan Documents and
in the certificates or other instruments prepared or delivered in connection
with or pursuant to this Agreement or any other Loan Document shall be
considered to have been relied upon by the Lenders and each Issuing Bank and
shall survive the making by the Lenders of the Loans, the execution and delivery
of the Loan Documents and the issuance of the Letters of Credit, regardless of
any investigation made by such persons or on their behalf, and shall continue in
full force and effect as long as the principal of or any accrued interest on any
Loan or L/C Disbursement or any Fee or any other amount payable under this
Agreement or any other Loan Document is outstanding and unpaid or any Letter of
Credit is outstanding and so long as the Commitments have not been terminated.
Without prejudice to the survival of any other agreements contained herein,
indemnification and reimbursement obligations contained herein (including
pursuant to Sections 2.15, 2.17 and 9.05) shall survive the payment in full of
the principal and interest hereunder, the expiration of the Letters of Credit
and the termination of the Commitments or this Agreement.

SECTION 9.03. Binding Effect. This Agreement shall become effective when it
shall have been executed by the Borrower and the Administrative Agent and when
the Administrative Agent shall have received copies hereof which, when taken
together, bear the signatures of each of the other parties hereto, and
thereafter shall be binding upon and inure to the benefit of the Borrower, each
Issuing Bank, the Administrative Agent and each Lender and their respective
permitted successors and assigns.

SECTION 9.04. Successors and Assigns.

(a) The provisions of this Agreement shall be binding upon and inure to the
benefit of the parties hereto and their respective successors and assigns
permitted hereby (including any affiliate of the Issuing Bank that issues any
Letter of Credit), except that (i) the Borrower may not assign or otherwise
transfer any of its rights or obligations hereunder without the prior written
consent of each Lender (and any attempted assignment or transfer by the Borrower
without such consent shall be null and void) and (ii) no Lender may assign or
otherwise transfer its rights or obligations hereunder except in accordance with
this Section 9.04. Nothing in this Agreement, express or implied, shall be
construed to confer upon any person (other than the parties hereto, their
respective successors and assigns permitted hereby (including any Affiliate of
the Issuing Bank that issues any Letter of Credit), Participants (to the extent
provided in paragraph (c) of this Section 9.04), and, to the extent expressly
contemplated hereby, the Related Parties of each of the Agents, the Issuing Bank
and the Lenders) any legal or equitable right, remedy or claim under or by
reason of this Agreement.

 

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(b) (i) Subject to the conditions set forth in paragraph (b)(ii) below, any
Lender may assign to one or more assignees (each, an “Assignee”) all or a
portion of its rights and obligations under this Agreement (including all or a
portion of its Commitments and the Loans at the time owing to it) with the prior
written consent (such consent not to be unreasonably withheld or delayed) of:

(A) the Borrower; provided that no consent of the Borrower shall be required for
an assignment (1) in connection with the primary syndication of the Commitments
and Loans or (2) to a Lender, an Affiliate of a Lender, an Approved Fund (as
defined below) or, if an Event of Default under Section 7.01(b), (c), (h), or
(i) has occurred and is continuing, any other person;

(B) the Administrative Agent provided that no consent of the Administrative
Agent shall be required for an assignment by a Lender (1) to an Affiliate of
such Lender or (2) to an Approved Fund of such Lender; and

(C) the Issuing Bank; provided that no consent of the Issuing Bank shall be
required for an assignment of all or any portion of a Term Loan.

(ii) Assignments shall be subject to the following additional conditions:

(A) except in the case of an assignment to a Lender, an Affiliate of a Lender or
an Approved Fund or an assignment of the entire remaining amount of the
assigning Lender’s Commitments or Loans under any Facility, the amount of the
Commitments or Loans of the assigning Lender subject to each such assignment
(determined as of the date the Assignment and Acceptance with respect to such
assignment is delivered to the Administrative Agent) shall not be less than
(x) $1.0 million in the case of Term Loans and (y) $2.5 million in the case of
Revolving Facility Loans or Revolving Facility Commitments, unless each of the
Borrower and the Administrative Agent otherwise consent; provided that such
amounts shall be aggregated in respect of each Lender and its Affiliates or
Approved Funds, if any;

(B) the parties to each assignment shall execute and deliver to the
Administrative Agent an Assignment and Acceptance, together with a processing
and recordation fee of $3,500; provided that only one such fee shall be payable
in the event of simultaneous assignments to or from two or more Approved Funds;
and

(C) the Assignee, if it shall not be a Lender, shall deliver to the
Administrative Agent an Administrative Questionnaire.

For the purposes of this Section 9.04, “Approved Fund” means any person (other
than a natural person) that is engaged in making, purchasing, holding or
investing in bank loans and similar extensions of credit in the ordinary course
and that is administered, advised or managed by (a) a Lender, (b) an Affiliate
of a Lender or (c) an entity or an Affiliate of an entity that administers,
advises or manages a Lender.

(iii) Subject to acceptance and recording thereof pursuant to paragraph (b)(v)
below, from and after the effective date specified in each Assignment and
Acceptance the Assignee thereunder shall be a party hereto and, to the extent of
the interest assigned by such Assignment and Acceptance, have the rights and
obligations of a Lender under this Agreement, and the assigning Lender
thereunder shall, to the extent of the interest assigned by such Assignment and
Acceptance, be released from its obligations under this Agreement (and, in the
case of an Assignment and Acceptance covering all of the assigning Lender’s
rights and obligations under this Agreement, such Lender shall cease to be a
party hereto but shall continue to be entitled to the benefits of Sections 2.15,
2.16, 2.17 and 9.05). Any assignment or transfer by a Lender of rights or
obligations under this Agreement that does not comply with this Section 9.04
shall be treated for purposes of this Agreement as a sale by such Lender of a
participation in such rights and obligations in accordance with paragraph (c) of
this Section 9.04.

 

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(iv) The Administrative Agent, acting for this purpose as an agent of the
Borrower, shall maintain at one of its offices a copy of each Assignment and
Acceptance delivered to it and a register for the recordation of the names and
addresses of the Lenders, and the Commitments of, the stated interest on and
principal amount of the Loans and Revolving L/C Exposure owing to, each Lender
pursuant to the terms hereof from time to time (the “Register”). The entries in
the Register shall be conclusive absent manifest error, and the Borrower, the
Administrative Agent, the Issuing Bank and the Lenders shall treat each person
whose name is recorded in the Register pursuant to the terms hereof as a Lender
hereunder for all purposes of this Agreement. The Register shall be available
for inspection by the Borrower, the Issuing Bank and any Lender, at any
reasonable time and from time to time upon reasonable prior notice.

(v) Upon its receipt of a duly completed Assignment and Acceptance executed by
an assigning Lender and an Assignee, the Assignee’s completed Administrative
Questionnaire (unless the Assignee shall already be a Lender hereunder), the
processing and recordation fee referred to in paragraph (b) of this Section and
any written consent to such assignment required by paragraph (b) of this
Section, the Administrative Agent shall accept such Assignment and Acceptance
and record the information contained therein in the Register. No assignment,
whether or not evidenced by a promissory note, shall be effective for purposes
of this Agreement unless it has been recorded in the Register as provided in
this paragraph (b)(v).

(c) (i) Any Lender may, without the consent of the Borrower or the
Administrative Agent, sell participations to one or more banks or other entities
(a “Participant”) in all or a portion of such Lender’s rights and obligations
under this Agreement (including all or a portion of its Commitments and the
Loans owing to it); provided that (A) such Lender’s obligations under this
Agreement shall remain unchanged, (B) such Lender shall remain solely
responsible to the other parties hereto for the performance of such obligations
and (C) the Borrower, the Administrative Agent, the Issuing Bank and the other
Lenders shall continue to deal solely and directly with such Lender in
connection with such Lender’s rights and obligations under this Agreement. Any
agreement pursuant to which a Lender sells such a participation shall provide
that such Lender shall retain the sole right to enforce this Agreement and the
other Loan Documents and to approve any amendment, modification or waiver of any
provision of this Agreement and the other Loan Documents; provided that (x) such
agreement may provide that such Lender will not, without the consent of the
Participant, agree to any amendment, modification or waiver that (1) requires
the consent of each Lender directly affected thereby pursuant to
Section 9.04(a)(i) or clause (i), (ii), (iii), (iv), (v) or (vi) of the first
proviso to Section 9.08(b) and (2) directly affects such Participant and (y) no
other agreement with respect to such Participant may exist between such Lender
and such Participant. Subject to the foregoing provisions of this paragraph
(c)(i) and to paragraph (c)(ii) of this Section 9.04, the Borrower agrees that
each Participant shall be entitled to the benefits of Sections 2.15, 2.16 and
2.17 (subject to the requirements of those Sections as if it were a Lender) to
the same extent as if it were a Lender and had acquired its interest by
assignment pursuant to paragraph (b) of this Section 9.04. Subject to the
foregoing provisions of this paragraph (c)(i), to the extent permitted by law,
each Participant also shall be entitled to the benefits of Section 9.06 as
though it were a Lender, provided such Participant shall be subject to
Section 2.18(c) as though it were a Lender.

(ii) A Participant shall not be entitled to receive any greater payment under
Section 2.15, 2.16 or 2.17 than the applicable Lender would have been entitled
to receive with respect to the participation sold to such Participant, unless
the sale of the participation to such Participant is made with the Borrower’s
prior written consent.

 

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(iii) In the event that any Lender sells participations in its rights and/or
obligations under this Agreement, such Lender, acting solely for this purpose as
a non-fiduciary agent of the Borrower, shall maintain a register similar to the
Register described in Section 9.04(b)(iv) on which it enters the name and
address of such Participants (the “Participant Register”) and the participations
sold to them. The entries in the Participant Register shall be conclusive in the
absence of manifest error, and the participating Lender shall treat each Person
whose name is recorded in the Participant Register as the owner of a Loan or
other obligation hereunder as the owner thereof for all purposes of this
Agreement. Any such Participant Register shall be available for inspection by
the Borrower, the Administrative Agent and any Lender at any reasonable time
upon reasonable prior notice.

(d) Any Lender may at any time, without the consent of or notice to the
Administrative Agent or the Borrower, pledge or assign a security interest in
all or any portion of its rights under this Agreement to secure obligations of
such Lender, including any pledge or assignment to secure obligations to a
Federal Reserve Bank, and this Section 9.04 shall not apply to any such pledge
or assignment of a security interest; provided that no such pledge or assignment
of a security interest shall release a Lender from any of its obligations
hereunder or substitute any such pledgee or Assignee for such Lender as a party
hereto.

(e) The Borrower, upon receipt of written notice from the relevant Lender,
agrees to issue Notes to any Lender requiring Notes to facilitate transactions
of the type described in paragraphs (b) and (d) above.

(f) Notwithstanding the foregoing, any Conduit Lender may assign any or all of
the Loans it may have funded hereunder to its designating Lender without the
consent of the Borrower or the Administrative Agent. Each of the Borrower, each
Lender and the Administrative Agent hereby confirms that it will not institute
against a Conduit Lender or join any other person in instituting against a
Conduit Lender any bankruptcy, reorganization, arrangement, insolvency or
liquidation proceeding under any state bankruptcy or similar law, for one year
and one day after the payment in full of the latest maturing commercial paper
note issued by such Conduit Lender; provided, however, that each Lender
designating any Conduit Lender hereby agrees to indemnify, save and hold
harmless each other party hereto and each Loan Party for any loss, cost, damage
or expense arising out of its inability to institute such a proceeding against
such Conduit Lender during such period of forbearance.

(g) If the Borrower wishes to replace the Loans or Commitments under any
Facility with ones having different terms, it shall have the option, with the
consent of the Administrative Agent and subject to at least three Business Days’
advance notice to the Lenders under such Facility, instead of prepaying the
Loans or reducing or terminating the Commitments to be replaced, to (i) require
the Lenders under such Facility to assign such Loans or Commitments to the
Administrative Agent or its designees and (ii) amend the terms thereof in
accordance with Section 9.08 (with such replacement, if applicable, being deemed
to have been made pursuant to Section 9.08(d)). Pursuant to any such assignment,
all Loans and Commitments to be replaced shall be purchased at par (allocated
among the Lenders under such Facility in the same manner as would be required if
such Loans were being optionally prepaid or such Commitments were being
optionally reduced or terminated by the Borrower), accompanied by payment of any
accrued interest and fees thereon and any amounts owing pursuant to
Section 9.05(b). By receiving such purchase price, the Lenders under such
Facility shall automatically be deemed to have assigned the Loans or Commitments
under such Facility pursuant to the terms of the form of Assignment and
Acceptance attached hereto as Exhibit A, and accordingly no other action by such
Lenders shall be required in connection therewith. The provisions of this
paragraph (g) are intended to facilitate the maintenance of the perfection and
priority of existing security interests in the Collateral during any such
replacement.

 

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SECTION 9.05. Expenses; Indemnity.

(a) The Borrower agrees to pay all reasonable out-of-pocket expenses (including
Other Taxes) incurred by the Administrative Agent in connection with the
preparation of this Agreement and the other Loan Documents and by the
Administrative Agent or Joint Lead Arrangers in connection with the syndication
of the Commitments or Loans or the administration of this Agreement (including
(i) expenses incurred in connection with due diligence and initial and ongoing
Collateral examination (after the Closing Date, to the extent no Event of
Default shall have occurred or be continuing, expenses referred to in this
clause (i) shall be subject to the Borrower’s reimbursement only with the
Borrower’s prior approval (such approval not to be unreasonably withheld)),
(ii) the reasonable fees, charges and disbursements of Cahill Gordon & Reindel
LLP, counsel for the Administrative Agent and the Joint Lead Arrangers and
(iii) the reasonable fees, charges and disbursements of one local counsel per
jurisdiction where Collateral is located or a Subsidiary Loan Party is
incorporated) or in connection with the administration of this Agreement and any
amendments, modifications or waivers of the provisions hereof or thereof
(whether or not the Transactions hereby contemplated shall be consummated) or
incurred by the Administrative Agent or any Lender in connection with the
enforcement or protection of their rights in connection with this Agreement and
the other Loan Documents, the Loans made hereunder or the Letters of Credit
issued hereunder.

(b) The Borrower agrees to indemnify the Administrative Agent, the Joint Lead
Arrangers, each Issuing Bank, each Lender and each of their respective
directors, trustees, officers, employees, advisors and agents (each such person
being called an “Indemnitee”) against, and to hold each Indemnitee harmless
from, any and all losses, claims, damages, liabilities and related expenses,
including reasonable counsel fees, charges and disbursements, incurred by or
asserted against any Indemnitee arising out of, in any way connected with, or as
a result of (i) the execution or delivery of this Agreement or any other Loan
Document or any agreement or instrument contemplated hereby or thereby, the
performance by the parties hereto and thereto of their respective obligations
thereunder or the consummation of the Transactions and the other transactions
contemplated hereby, (ii) the use of the proceeds of the Loans or the use of any
Letter of Credit or (iii) any claim, litigation, investigation or proceeding
relating to any of the foregoing, whether or not any Indemnitee is a party
thereto; provided that such indemnity shall not, as to any Indemnitee, be
available to the extent that such losses, claims, damages, liabilities or
related expenses are determined by a final, non-appealable judgment of a court
of competent jurisdiction to have resulted solely by reason of the gross
negligence or willful misconduct of such Indemnitee. Subject to and without
limiting the generality of the foregoing sentence, the Borrower agrees to
indemnify each Indemnitee against, and hold each Indemnitee harmless from, any
and all losses, claims, damages, liabilities and related expenses, including
reasonable counsel or consultant fees, charges and disbursements (limited to not
more than one counsel, plus, if necessary, one local counsel per jurisdiction),
incurred by or asserted against any Indemnitee arising out of, in any way
connected with, or as a result of (A) any claim related in any way to
Environmental Laws and the Borrower or any Subsidiary, or (B) any actual or
alleged presence, Release or threatened Release of Hazardous Materials at,
under, on or from any Property; provided that such indemnity shall not, as to
any Indemnitee, be available to the extent that such losses, claims, damages,
liabilities or related expenses are determined by a court of competent
jurisdiction by final and nonappealable judgment to have resulted from the gross
negligence or willful misconduct of such Indemnitee or any of its Related
Parties. The Borrower shall not be liable for any settlement of any proceeding
referred to in this Section 9.05 effected without their written consent, but if
settled with such consent or if there shall be a final judgment for the
plaintiff, the Borrower shall indemnify the Indemnitees from and against any
loss or liability by reason of such settlement or judgment, subject to the
Borrower’s right in this Section 9.05 to claim an exemption from such indemnity
obligations. The Borrower shall not, without the prior written consent of any
Indemnitee, effect any settlement of any pending or threatened proceeding in
respect of which such Indemnitee is or could have been a party and indemnity

 

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could have been sought hereunder by such Indemnitee unless such settlement
(i) includes an unconditional release of such Indemnitee from all liability or
claims that are the subject matter of such proceeding and (ii) does not include
a statement as to or an admission of fault, culpability or a failure to act by
or on behalf of any Indemnitee. None of the Indemnitees (or any of their
respective affiliates) shall be responsible or liable to the Sponsor, the
Borrower or any of their respective subsidiaries, Affiliates or stockholders or
any other person or entity for any consequential or punitive damages, which may
be alleged as a result of the Facilities or the Transactions. The provisions of
this Section 9.05 shall remain operative and in full force and effect regardless
of the expiration of the term of this Agreement, the consummation of the
transactions contemplated hereby, the repayment of any of the Obligations, the
invalidity or unenforceability of any term or provision of this Agreement or any
other Loan Document, or any investigation made by or on behalf of the
Administrative Agent, any Issuing Bank or any Lender. All amounts due under this
Section 9.05 shall be payable on written demand therefor accompanied by
reasonable documentation with respect to any reimbursement, indemnification or
other amount requested.

(c) Amounts paid pursuant to this Section 9.05 shall not be duplicative with any
amounts paid pursuant to Section 2.17.

SECTION 9.06. Right of Set-off. If an Event of Default shall have occurred and
be continuing, each Lender and each Issuing Bank is hereby authorized at any
time and from time to time, to the fullest extent permitted by law, to set off
and apply any and all deposits (general or special, time or demand, provisional
or final) at any time held and other indebtedness at any time owing by such
Lender or such Issuing Bank to or for the credit or the account of the Borrower
or any Subsidiary against any of and all the obligations of the Borrower now or
hereafter existing under this Agreement or any other Loan Document held by such
Lender or such Issuing Bank, irrespective of whether or not such Lender or such
Issuing Bank shall have made any demand under this Agreement or such other Loan
Document and although the obligations may be unmatured. The rights of each
Lender and each Issuing Bank under this Section 9.06 are in addition to other
rights and remedies (including other rights of set-off) that such Lender or such
Issuing Bank may have.

SECTION 9.07. Applicable Law. THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS (OTHER
THAN LETTERS OF CREDIT AND AS EXPRESSLY SET FORTH IN OTHER LOAN DOCUMENTS) SHALL
BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE STATE OF NEW
YORK, WITHOUT REGARD TO CONFLICTS OF LAW PRINCIPLES THAT WOULD REQUIRE THE
APPLICATION OF THE LAWS OF ANOTHER JURISDICTION.

SECTION 9.08. Waivers; Amendment.

(a) No failure or delay of the Administrative Agent, any Issuing Bank or any
Lender in exercising any right or power hereunder or under any Loan Document
shall operate as a waiver thereof, nor shall any single or partial exercise of
any such right or power, or any abandonment or discontinuance of steps to
enforce such a right or power, preclude any other or further exercise thereof or
the exercise of any other right or power. The rights and remedies of the
Administrative Agent, each Issuing Bank and the Lenders hereunder and under the
other Loan Documents are cumulative and are not exclusive of any rights or
remedies that they would otherwise have. No waiver of any provision of this
Agreement or any other Loan Document or consent to any departure by the Borrower
or any other Loan Party therefrom shall in any event be effective unless the
same shall be permitted by paragraph (b) below, and then such waiver or consent
shall be effective only in the specific instance and for the purpose for which
given. No notice or demand on the Borrower or any other Loan Party in any case
shall entitle such person to any other or further notice or demand in similar or
other circumstances.

 

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(b) Neither this Agreement nor any other Loan Document nor any provision hereof
or thereof may be waived, amended or modified except (x) in the case of this
Agreement, pursuant to an agreement or agreements in writing entered into by the
Borrower and the Required Lenders and (y) in the case of any other Loan
Document, pursuant to an agreement or agreements in writing entered into by each
party thereto and the Administrative Agent and consented to by the Required
Lenders; provided, however, that no such agreement shall

(i) decrease or forgive the principal amount of, or extend the final maturity
of, or decrease the rate of interest on, any Loan or any L/C Disbursement, or
extend the stated expiration of any Letter of Credit beyond the Revolving
Facility Maturity Date, without the prior written consent of each Lender
directly affected thereby; provided that any amendment to the financial covenant
definitions in this Agreement shall not constitute a reduction in the rate of
interest for purposes of this clause (i),

(ii) increase or extend the Commitment of any Lender or decrease the Commitment
Fees or L/C Participation Fees or other fees of any Lender without the prior
written consent of such Lender (it being understood that waivers or
modifications of conditions precedent, covenants, Defaults or Events of Default
or of a mandatory reduction in the aggregate Commitments shall not constitute an
increase of the Commitment of any Lender),

(iii) extend or waive any Term Loan Installment Date or reduce the amount due on
any Term Loan Installment Date or extend any date on which payment of interest
on any Loan or any L/C Disbursement or any Fees is due, without the prior
written consent of each Lender adversely affected thereby,

(iv) amend or modify the provisions of Section 2.18(b) or (c) or 2.10(d) of this
Agreement or Section 5.02 of the Collateral Agreement in a manner that would by
its terms alter the pro rata sharing of payments required thereby, without the
prior written consent of each Lender adversely affected thereby,

(v) amend or modify the provisions of this Section 9.08 or the definition of the
terms “Required Lenders” or any other provision hereof specifying the number or
percentage of Lenders required to waive, amend or modify any rights hereunder or
make any determination or grant any consent hereunder, without the prior written
consent of each Lender adversely affected thereby (it being understood that,
with the consent of the Required Lenders, additional extensions of credit
pursuant to this Agreement may be included in the determination of the Required
Lenders on substantially the same basis as the Loans and Commitments are
included on the Closing Date),

(vi) release all or substantially all the Collateral or release all or
substantially all of the Subsidiary Loan Parties from their respective
Guarantees under the Collateral Agreement, unless, in the case of a Subsidiary
Loan Party, all or substantially all the Equity Interests of such Subsidiary
Loan Party is sold or otherwise disposed of in a transaction permitted by this
Agreement, without the prior written consent of each Lender, or

(vii) effect any waiver, amendment or modification of any Loan Document that
would alter the relative priorities of the rights of the Secured Parties in the
Collateral, without the prior written consent of each Secured Party;

provided, further, that no such agreement shall amend, modify or otherwise
affect the rights or duties of the Administrative Agent or an Issuing Bank
hereunder without the prior written consent of the Administrative

 

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Agent or such Issuing Bank acting as such at the effective date of such
agreement, as applicable. Each Lender shall be bound by any waiver, amendment or
modification authorized by this Section 9.08 and any consent by any Lender
pursuant to this Section 9.08 shall bind any assignee of such Lender.

(c) Without the consent of the Syndication Agent or any Joint Lead Arranger or
Lender or Issuing Bank, the Loan Parties and the Administrative Agent may (in
their respective sole discretion, or shall, to the extent required by any Loan
Document) enter into any amendment, modification or waiver of any Loan Document,
or enter into any new agreement or instrument, to effect the granting,
perfection, protection, expansion or enhancement of any security interest in any
Collateral or additional property to become Collateral for the benefit of the
Secured Parties, or as required by local law to give effect to, or protect any
security interest for the benefit of the Secured Parties, in any property or so
that the security interests therein comply with applicable law.

(d) Notwithstanding the foregoing, this Agreement may be amended (or amended and
restated) with the written consent of the Required Lenders, the Administrative
Agent and the Borrower (a) to add one or more additional credit facilities to
this Agreement and to permit the extensions of credit from time to time
outstanding thereunder and the accrued interest and fees in respect thereof to
share ratably in the benefits of this Agreement and the other Loan Documents
with the Term Loans and the Revolving Facility Loans and the accrued interest
and fees in respect thereof and (b) to include appropriately the Lenders holding
such credit facilities in any determination of the Required Lenders.

SECTION 9.09. Interest Rate Limitation. Notwithstanding anything herein to the
contrary, if at any time the applicable interest rate, together with all fees
and charges that are treated as interest under applicable law (collectively, the
“Charges”), as provided for herein or in any other document executed in
connection herewith, or otherwise contracted for, charged, received, taken or
reserved by any Lender or any Issuing Bank, shall exceed the maximum lawful rate
(the “Maximum Rate”) that may be contracted for, charged, taken, received or
reserved by such Lender in accordance with applicable law, the rate of interest
payable hereunder, together with all Charges payable to such Lender or such
Issuing Bank, shall be limited to the Maximum Rate; provided that such excess
amount shall be paid to such Lender or such Issuing Bank on subsequent payment
dates to the extent not exceeding the legal limitation.

SECTION 9.10. Entire Agreement. This Agreement, the other Loan Documents and the
agreements regarding certain Fees referred to herein constitute the entire
contract between the parties relative to the subject matter hereof. Any previous
agreement among or representations from the parties or their Affiliates with
respect to the subject matter hereof is superseded by this Agreement and the
other Loan Documents. Notwithstanding the foregoing, the Fee Letter shall
survive the execution and delivery of this Agreement and remain in full force
and effect. Nothing in this Agreement or in the other Loan Documents, expressed
or implied, is intended to confer upon any party other than the parties hereto
and thereto any rights, remedies, obligations or liabilities under or by reason
of this Agreement or the other Loan Documents.

SECTION 9.11. WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY WAIVES, TO THE
FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY
JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF, UNDER
OR IN CONNECTION WITH THIS AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS. EACH
PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY
OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD
NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND
(B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED

 

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TO ENTER INTO THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS, AS APPLICABLE, BY,
AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION 9.11.

SECTION 9.12. Severability. In the event any one or more of the provisions
contained in this Agreement or in any other Loan Document should be held
invalid, illegal or unenforceable in any respect, the validity, legality and
enforceability of the remaining provisions contained herein and therein shall
not in any way be affected or impaired thereby. The parties shall endeavor in
good-faith negotiations to replace the invalid, illegal or unenforceable
provisions with valid provisions the economic effect of which comes as close as
possible to that of the invalid, illegal or unenforceable provisions.

SECTION 9.13. Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall constitute an original but all of which, when
taken together, shall constitute but one contract, and shall become effective as
provided in Section 9.03. Delivery of an executed counterpart to this Agreement
by facsimile transmission shall be as effective as delivery of a manually signed
original.

SECTION 9.14. Headings. Article and Section headings and the Table of Contents
used herein are for convenience of reference only, are not part of this
Agreement and are not to affect the construction of, or to be taken into
consideration in interpreting, this Agreement.

SECTION 9.15. Jurisdiction; Consent to Service of Process.

(a) Each of the parties hereto hereby irrevocably and unconditionally submits,
for itself and its property, to the nonexclusive jurisdiction of any New York
State court or federal court of the United States of America sitting in New York
City, and any appellate court from any thereof, in any action or proceeding
arising out of or relating to this Agreement or the other Loan Documents, or for
recognition or enforcement of any judgment, and each of the parties hereto
hereby irrevocably and unconditionally agrees that all claims in respect of any
such action or proceeding may be heard and determined in such New York State or,
to the extent permitted by law, in such federal court. Each of the parties
hereto agrees that a final judgment in any such action or proceeding shall be
conclusive and may be enforced in other jurisdictions by suit on the judgment or
in any other manner provided by law. Nothing in this Agreement shall affect any
right that any Lender or any Issuing Bank may otherwise have to bring any action
or proceeding relating to this Agreement or the other Loan Documents against the
Borrower or any Loan Party or their properties in the courts of any
jurisdiction.

(b) Each of the parties hereto hereby irrevocably and unconditionally waives, to
the fullest extent it may legally and effectively do so, any objection which it
may now or hereafter have to the laying of venue of any suit, action or
proceeding arising out of or relating to this Agreement or the other Loan
Documents in any New York State or federal court. Each of the parties hereto
hereby irrevocably waives, to the fullest extent permitted by law, the defense
of an inconvenient forum to the maintenance of such action or proceeding in any
such court.

SECTION 9.16. Confidentiality. Each of the Lenders, each Issuing Bank and each
of the Agents agrees that it shall maintain in confidence any information
relating to the Borrower and the other Loan Parties furnished to it by or on
behalf of the Borrower or the other Loan Parties (other than information that
(a) has become generally available to the public other than as a result of a
disclosure by such party, (b) has been independently developed by such Lender,
such Issuing Bank or such Agent without violating this Section 9.16 or (c) was
available to such Lender, such Issuing Bank or such Agent from a third party
having, to such person’s knowledge, no obligations of confidentiality to the
Borrower or any other Loan Party) and shall not reveal the same other than to
its directors, trustees, officers, employees,

 

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advisors and Affiliates with a need to know or to any person that approves or
administers the Loans on behalf of such Lender (so long as each such person
shall have been instructed to keep the same confidential in accordance with this
Section 9.16), except: (A) to the extent necessary to comply with law or any
legal process or the requirements of any Governmental Authority, the National
Association of Insurance Commissioners or of any securities exchange on which
securities of the disclosing party or any Affiliate of the disclosing party are
listed or traded, (B) as part of the reporting or review procedures to, or
examinations by, Governmental Authorities or self-regulatory authorities,
including the National Association of Insurance Commissioners or the National
Association of Securities Dealers, Inc., (C) to its parent companies, Affiliates
or auditors (so long as each such person shall have been instructed to keep the
same confidential in accordance with this Section 9.16), (D) in order to enforce
its rights under any Loan Document in a legal proceeding, (E) to any pledge
under Section 9.04(d) or any other prospective assignee of, or prospective
Participant in, any of its rights under this Agreement (so long as such person
shall have been instructed to keep the same confidential in accordance with this
Section 9.16), (F) to any direct or indirect contractual counterparty in Swap
Agreements or such contractual counterparty’s professional advisor (so long as
such contractual counterparty or professional advisor to such contractual
counterparty agrees to be bound by the provisions of this Section 9.16), (G) to
an investor or prospective investor in a Securitization that agrees that its
access to information regarding the Loan Parties, the Loans and Loan Documents
is solely for purposes of evaluating an investment in a Securitization and is
instructed to treat such information as confidential, (H) to a trustee,
collateral manager, servicer, backup servicer, noteholder or secured party in a
Securitization in connection with the administration, servicing and reporting on
the assets serving as collateral for a Securitization, and (I) to a nationally
recognized rating agency that requires access to information regarding the Loan
Parties, the Loans and Loan Documents in connection with ratings issued with
respect to a Securitization.

SECTION 9.17. Direct Website Communications.

(a) Delivery. (i) Each Loan Party hereby agrees that it will provide to the
Administrative Agent all information, documents and other materials that it is
obligated to furnish to the Administrative Agent pursuant to this Agreement and
any other Loan Document, including, without limitation, all notices, requests,
financial statements, financial and other reports, certificates and other
information materials, but excluding any such communication that (A) relates to
a request for a new, or a conversion of an existing, borrowing or other
extension of credit (including any election of an interest rate or interest
period relating thereto), (B) relates to the payment of any principal or other
amount due under this Agreement prior to the scheduled date therefor,
(C) provides notice of any Default or Event of Default under this Agreement or
(D) is required to be delivered to satisfy any condition precedent to the
effectiveness of this Agreement and/or any borrowing or other extension of
credit hereunder (all such non-excluded communications collectively, the
“Communications”), by transmitting the Communications in an electronic/soft
medium in a format acceptable to the Administrative Agent to
oploanswebadmin@citigroup.com. Nothing in this Section 9.17 shall prejudice the
right of the Administrative Agent, the Syndication Agent, the Joint Lead
Arrangers or any Lender or any Loan Party to give any notice or other
communication pursuant to this Agreement or any other Loan Document in any other
manner specified in this Agreement or any other Loan Document.

(ii) The Administrative Agent agrees that receipt of the Communications by the
Administrative Agent at its e-mail address set forth above shall constitute
effective delivery of the Communications to the Administrative Agent for
purposes of the Loan Documents. Each Lender agrees that notice to it (as
provided in the next sentence) specifying that the Communications have been
posted to the Platform (as defined below) shall constitute effective delivery of
the Communications to such Lender for purposes of the Loan Documents. Each
Lender agrees (A) to notify the Administrative Agent in writing (including by
electronic communication) from time to time of such Lender’s e-mail address to
which the foregoing notice may be sent by electronic transmission and (B) that
the foregoing notice may be sent to such e-mail address.

 

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(b) Posting. Each Loan Party further agrees that the Administrative Agent may
make the Communications available to the Lenders by posting the Communications
on Intralinks or a substantially similar electronic transmission system (the
“Platform”).

(c) Platform. The Platform is provided “as is” and “as available.” The Agent
Parties (as defined below) do not warrant the accuracy or completeness of the
Communications, or the adequacy of the Platform and expressly disclaim liability
for errors or omissions in the Communications. No warranty of any kind, express,
implied or statutory, including, without limitation, any warranty of
merchantability, fitness for a particular purpose, non-infringement of third
party rights or freedom from viruses or other code defects, is made by any Agent
Party in connection with the Communications or the Platform. In no event shall
the Administrative Agent or any of its affiliates or any of their respective
officers, directors, employees, agents advisors or representatives
(collectively, “Agent Parties”) have any liability to the Loan Parties, any
Lender or any other person or entity for damages of any kind, including, without
limitation, direct or indirect, special, incidental or consequential damages,
losses or expenses (whether in tort, contract or otherwise) arising out of any
Loan Party’s or the Administrative Agent’s transmission of communications
through the internet, except to the extent the liability of any Agent Party is
found in a final non-appealable judgment by a court of competent jurisdiction to
have resulted primarily from such Agent Party’s gross negligence or willful
misconduct.

SECTION 9.18. Release of Liens and Guarantees. In the event that any Loan Party
conveys, sells, leases, assigns, transfers or otherwise disposes of all or any
portion of any of the Equity Interests or assets of any Subsidiary Loan Party to
a person that is not (and is not required to become) a Loan Party in a
transaction not prohibited by Section 6.05, the Administrative Agent shall
promptly (and the Lenders hereby authorize the Administrative Agent to) take
such action and execute any such documents as may be reasonably requested by the
Borrower and at the Borrower’s expense to release any Liens created by any Loan
Document in respect of such Equity Interests or such assets, and, in the case of
a disposition of the Equity Interests of any Subsidiary Loan Party in a
transaction permitted by Section 6.05 and as a result of which such Subsidiary
Loan Party would cease to be a Subsidiary, terminate such Subsidiary Loan
Party’s obligations under its Guarantee. In addition, the Administrative Agent
agrees to take such actions as are reasonably requested by the Borrower and at
the Borrower’s expense to terminate the Liens and security interests created by
the Loan Documents when all the Obligations are paid in full and all Letters of
Credit and Commitments are terminated. Any representation, warranty or covenant
contained in any Loan Document relating to any such Equity Interests, asset or
subsidiary of the Borrower shall no longer be deemed to be made once such Equity
Interests or asset is so conveyed, sold, leased, assigned, transferred or
disposed of.

SECTION 9.19. USA Patriot Act. Each Lender hereby notifies the Borrower that
pursuant to the requirements of the USA Patriot Act (Title III of Pub. L. 107-56
(signed into law October 26, 2001)) (the “Act”), it is required to obtain,
verify and record information that identifies the Borrower, which information
includes the name and address of the Borrower and other information that will
allow such Lender to identify the Borrower in accordance with the Act.

[Signature Pages Follow]

 

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

 

SECURE COMPUTING CORPORATION, as Borrower By:  

/s/ Timothy J. Steinkopf

 

Name:  

/s/ Timothy J. Steinkopf

Title:   SVP and CFO CIPHERTRUST, INC., as a Subsidiary Loan Party By:  

/s/ Jay Chaudhry

 

Name:   Jay Chaudhry Title:   CEO and Chairman

 

S-1

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CITICORP USA, INC., as Administrative Agent and Swingline Lender By:  

/s/ David J. Wirdnam

Name:   David J. Wirdnam Title:   Director and Vice President CITIBANK, N.A., as
Issuing Bank By:  

/s/ David J. Wirdnam

Name:   David J. Wirdnam Title:   Director and Vice President

 

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UBS SECURITIES LLC, as Syndication Agent By:  

/s/ Richard L. Tavrow

 

Name:   Richard L. Tavrow Title:   Director By:  

/s/ Irja R. Otsa

 

Name:   Irja R. Otsa Title:   Associate Director

 

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CITICORP USA, INC., as a Lender By:  

/s/ David J. Wirdnam

Name:   David J. Wirdnam Title:   Director and Vice President

 

S-4

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UBS LOAN FINANCE LLC, as a Lender By:  

/s/ Richard L. Tavrow

 

Name:   Richard L. Tavrow Title:   Director By:  

/s/ Irja R. Otsa

 

Name:   Irja R. Otsa Title:   Associate Director

 

S-5

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EXHIBIT A

[FORM OF]

ASSIGNMENT AND ACCEPTANCE

Reference is made to the Credit Agreement, dated as of August [31], 2006 (as
amended, supplemented or otherwise modified from time to time, the “Credit
Agreement”), among SECURE COMPUTING CORPORATION, a Delaware corporation (the
“Borrower”), the Subsidiary Loan Party party thereto, the Lenders party thereto
from time to time, CITICORP USA, INC., as administrative agent (in such
capacity, the “Administrative Agent”) for the Lenders and as Swingline Lender,
CITIBANK, N.A., as Issuing Bank, UBS SECURITIES LLC, as syndication agent (in
such capacity, the “Syndication Agent”) and CITIGROUP GLOBAL MARKETS INC. and
UBS SECURITIES LLC, as joint lead arrangers (collectively and in such
capacities, the “Joint Lead Arrangers”) and as joint bookrunners.

The Assignor identified on Schedule l hereto (the “Assignor”) and the Assignee
identified on Schedule l hereto (the “Assignee”) agree as follows:

1. The Assignor hereby irrevocably sells and assigns to the Assignee without
recourse to the Assignor, and the Assignee hereby irrevocably purchases and
assumes from the Assignor without recourse to the Assignor, as of the Effective
Date (as defined below), the interest described in Schedule 1 hereto (the
“Assigned Interest”) in and to the Assignor’s rights and obligations under the
Credit Agreement with respect to those credit facilities contained in the Credit
Agreement as are set forth on Schedule 1 hereto (individually, an “Assigned
Facility”; collectively, the “Assigned Facilities”), in a principal amount for
each Assigned Facility as set forth on Schedule 1 hereto.

2. The Assignor (a) makes no representation or warranty and assumes no
responsibility with respect to any statements, warranties or representations
made in or in connection with the Credit Agreement or with respect to the
execution, legality, validity, enforceability, genuineness, sufficiency or value
of the Credit Agreement, any other Loan Document or any other instrument or
document furnished pursuant thereto, other than that the Assignor has not
created any adverse claim upon the interest being assigned by it hereunder and
that such interest is free and clear of any such adverse claim and (b) makes no
representation or warranty and assumes no responsibility with respect to the
financial condition of the Borrower, any of its Affiliates or any other obligor
or the performance or observance by the Borrower, any of its Affiliates or any
other obligor of any of their respective obligations under the Credit Agreement
or any other Loan Document or any other instrument or document furnished
pursuant hereto or thereto.

3. The Assignee (a) represents and warrants that it is legally authorized to
enter into this Assignment and Acceptance; (b) confirms that it has received a
copy of the Credit Agreement, together with copies of the financial statements
delivered pursuant to Section 3.05 thereof and such other documents and
information as it has deemed appropriate to make its own credit analysis and
decision to enter into this Assignment and Acceptance; (c) agrees that it will,
independently and without reliance upon the Assignor, the Agents or any Lender
and based on

 

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such documents and information as it shall deem appropriate at the time,
continue to make its own credit decisions in taking or not taking action under
the Credit Agreement, the other Loan Documents or any other instrument or
document furnished pursuant hereto or thereto; (d) appoints and authorizes the
Administrative Agent to take such action as agent on its behalf and to exercise
such powers and discretion under the Credit Agreement, the other Loan Documents
or any other instrument or document furnished pursuant hereto or thereto as are
delegated to the Administrative Agent by the terms thereof, together with such
powers as are incidental thereto; and (e) agrees that it will be bound by the
provisions of the Credit Agreement and will perform in accordance with its terms
all the obligations which by the terms of the Credit Agreement are required to
be performed by it as a Lender including, if it is organized under the laws of a
jurisdiction outside the United States, its obligation pursuant to
Section 2.17(f) of the Credit Agreement.

4. The effective date of this Assignment and Acceptance shall be the Effective
Date of Assignment described in Schedule 1 hereto (the “Effective Date”).
Following the execution of this Assignment and Acceptance, it will be delivered
to the Administrative Agent for acceptance by it and recording by the
Administrative Agent pursuant to the Credit Agreement, effective as of the
Effective Date (which shall not, unless otherwise agreed to by the
Administrative Agent, be earlier than five Business Days after the date of such
acceptance and recording by the Administrative Agent).

5. Upon such acceptance and recording, from and after the Effective Date, the
Administrative Agent shall make all payments in respect of the Assigned Interest
(including payments of principal, interest, fees and other amounts) to the
Assignor for amounts which have accrued to the Effective Date and to the
Assignee for amounts which have accrued subsequent to the Effective Date.

6. From and after the Effective Date, (a) the Assignee shall be a party to the
Credit Agreement and, to the extent provided in this Assignment and Acceptance,
have the rights and obligations of a Lender thereunder and under the other Loan
Documents and shall be bound by the provisions thereof and (b) the Assignor
shall, to the extent provided in this Assignment and Acceptance, relinquish its
rights and be released from its obligations under the Credit Agreement.

7. This Assignment and Acceptance shall be governed by and construed in
accordance with the laws of the State of New York.

IN WITNESS WHEREOF, the parties hereto have caused this Assignment and
Acceptance to be executed as of the date first above written by their respective
duly authorized officers on Schedule 1 hereto.

 

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Schedule 1

to Assignment and Acceptance with respect to

the Credit Agreement, dated as of August [31], 2006,

among Secure Computing Corporation (“Borrower”),

the Subsidiary Loan Party party thereto,

the Lenders party thereto from time to time, the Syndication Agent,

Joint Lead Arrangers and Joint Bookrunners named therein and

Citicorp USA, Inc., as Administrative Agent

 

Name of Assignor:                                     

 

Name of Assignee:                                     

 

Effective Date of Assignment:                     

 

Credit Facility Assigned

  

Principal

Amount Assigned

   Commitment
Percentage
Assigned      $                     .     %

 

[Name of Assignee]     [Name of Assignor] By:  

 

    By:  

 

Title:       Title   Accepted for Recordation in the Register:     Required
Consents (if any):

Citicorp USA, Inc.,

as Administrative Agent

    Secure Computing Corporation By:  

 

    By:  

 

Title:       Title:        

Citicorp USA, Inc.,

as Administrative Agent

      By:  

 

      Title:  

 

A-3

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EXHIBIT B

[Form of]

ADMINISTRATIVE QUESTIONNAIRE

Secure Computing Corporation

 

Agent Address: Citicorp USA, Inc.   Return form to: [contact]
                            [Street]   Telephone: [        ]
                            [City, State ZIP]   Facsimile: [        ]

It is very important that all of the requested information be completed
accurately and that this questionnaire be returned promptly. If your institution
is sub-allocating its allocation, please fill out an administrative
questionnaire for each legal entity.

Legal Name of Lender to appear in Documentation:

______________________________________________________________________________________________________

Signature Block Information:
________________________________________________________________________________

 

•      Signing Credit Agreement

   ¨        Yes                ¨        No

•      Coming in via Assignment

   ¨        Yes                ¨        No

Type of Lender:                     

(Bank, Asset Manager, Broker/Dealer, CLO/CDO; Finance Company, Hedge Fund,
Insurance, Mutual Fund, Pension Fund, Other Regulated Investment Fund, Special
Purpose Vehicle, Other- please specify)

 

Lender Parent:
___________________________________________________________________________________________

 

Domestic Address

       

Eurodollar Address

 

     

 

 

     

 

 

     

 

 

B-1

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Contacts/Notification Methods: Borrowings, Paydowns, Interest, Fees, etc.

 

  Primary Credit Contact     Secondary Credit Contact   Name:  

 

   

 

  Company:  

 

   

 

  Title:  

 

   

 

  Address:  

 

   

 

   

 

   

 

  Telephone:  

 

   

 

  Facsimile:  

 

   

 

  E-Mail Address:  

 

   

 

    Primary Operations Contact     Secondary Operations Contact   Name:  

 

   

 

  Company:  

 

   

 

  Title:  

 

   

 

  Address:  

 

   

 

  Telephone:  

 

   

 

  Facsimile:  

 

   

 

  E-Mail Address:  

 

   

 

    Bid Contact     L/C Contact   Name:  

 

   

 

  Company:  

 

   

 

  Title:  

 

   

 

  Address:  

 

   

 

   

 

   

 

  Telephone:  

 

   

 

  Facsimile:  

 

   

 

  E-Mail Address:  

 

   

 

 

 

B-2

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

Lender’s Domestic Wire Instructions   Bank Name:  

 

  ABA/Routing No.:  

 

  Account Name:  

 

  Account No.:  

 

  FFC Account Name:  

 

  FFC Account No.:  

 

  Attention:  

 

  Reference:  

 

  Lender’s Foreign Wire Instructions   Currency:  

 

  Bank Name:  

 

  Swift/Routing No.:  

 

  Account Name:  

 

  Account No.:  

 

  FFC Account Name:  

 

  FFC Account No.:  

 

  Attention:  

 

  Reference:  

 

  Agent’s Wire Instructions   [The Agent’s wire instructions will be disclosed
at the time of closing.]   Bank Name:  

 

  ABA/Routing No.:  

 

  Account Name:  

 

  Account No.:  

 

  FFC Account Name:  

 

  FFC Account No.:  

 

  Attention:  

 

  Reference:  

 

 

 

B-3

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Tax Documents

NON-U.S. LENDER INSTITUTIONS:

I. Corporations:

If your institution is incorporated outside of the United States for U.S.
federal income tax purposes, and is the beneficial owner of the interest and
other income it receives, you must complete one of the following three tax
forms, as applicable to your institution: a.) Form W-8BEN (Certificate of
Foreign Status of Beneficial Owner), b.) Form W-8ECI (Income Effectively
Connected to a U.S. Trade or Business), or c.) Form W-8EXP (Certificate of
Foreign Government or Governmental Agency).

A U.S. taxpayer identification number is required for any institution submitting
Form W-8ECI. It is also required on Form W-8BEN for certain institutions
claiming the benefits of a tax treaty with the U.S. Please refer to the
instructions when completing the form applicable to your institution. In
addition, please be advised that U.S. tax regulations do not permit the
acceptance of faxed forms. An original tax form must be submitted.

II. Flow-Through Entities:

If your institution is organized outside the U.S., and is classified for U.S.
federal income tax purposes as either a Partnership, Trust, Qualified or
Non-Qualified Intermediary, or other non- U.S. flow-through entity, an original
Form W-8IMY (Certificate of Foreign Intermediary, Foreign Flow-Through Entity,
or Certain U.S. Branches for United States Tax Withholding) must be completed by
the intermediary together with a withholding statement. Flow-through entities
other than Qualified Intermediaries are required to include tax forms for each
of the underlying beneficial owners.

Please refer to the instructions when completing this form. In addition, please
be advised that U.S. tax regulations do not permit the acceptance of faxed
forms. Original tax form(s) must be submitted.

U.S. LENDER INSTITUTIONS:

If your institution is incorporated or organized within the United States, you
must complete and return Form W-9 (Request for Taxpayer Identification Number
and Certification). Please be advised that we request that you submit an
original Form W-9.

Pursuant to the language contained in the tax section of the Credit Agreement,
the applicable tax form for your institution must be completed and returned
prior to the first payment of income. Failure to provide the proper tax form
when requested may subject your institution to U.S. tax withholding.

 

B-4

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EXHIBIT C-1

[FORM OF]

BORROWING REQUEST

Citicorp USA, Inc.,

    as Administrative Agent

    for the Lenders referred to below

390 Greenwich Street

New York, New York

Attention:     Hector Guenther

Fax:             (646) 291-1650

Ladies and Gentlemen:

Reference is made to the Credit Agreement, dated as of August [31], 2006 (as
amended, supplemented or otherwise modified from time to time, the “Credit
Agreement”), among SECURE COMPUTING CORPORATION, a Delaware corporation (the
“Borrower”), the Subsidiary Loan Party party thereto, the Lenders party thereto
from time to time, CITICORP USA, INC., as administrative agent (in such
capacity, the “Administrative Agent”) for the Lenders and as Swingline Lender,
CITIBANK, N.A., as Issuing Bank, UBS SECURITIES LLC, as syndication agent (in
such capacity, the “Syndication Agent”) and CITIGROUP GLOBAL MARKETS INC. and
UBS SECURITIES LLC, as joint lead arrangers (collectively and in such
capacities, the “Joint Lead Arrangers”) and as joint bookrunners. Terms defined
in the Credit Agreement are used herein with the same meanings. This notice
constitutes a Borrowing Request and the Borrower hereby requests Borrowings
under the Credit Agreement, and in that connection the Borrower specifies the
following information with respect to such Borrowings requested hereby:

For a Revolving Borrowing,

 

  A. Facility:                                     
                                        
                                                                            

 

  B. Aggregate Amount of Borrowing1:                                     
                                                                          

 

  C. Date of Borrowing (which shall be a Business
Day):                                       
                                            

 

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

1 In the case of an ABR or Eurocurrency Revolving Borrowing not less than
$500,000 and an integral multiple of $100,000.

 

C-1-1

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

  D. Type of Borrowing (ABR or
Eurocurrency):                                                                 

 

  E. Interest Period (if a Eurocurrency
Borrowing)2:                                                            

 

  F. Location and number of Borrower’s account with the Administrative Agent to
which proceeds of Borrowing are to be disbursed:                            

For a Term Borrowing,

 

  (A) Facility:                                     
                                        
                                                                    

 

  (B) Aggregate Amount of Borrowing:                                      
                                                                   

 

  (C) Date of Borrowing (which shall be a Business
Day):                                                                           

 

  (D) Type of Borrowing (ABR or
Eurocurrency):                                     
                                                    

 

  (E) Interest Period (if a Eurocurrency
Borrowing)3:                                     
                                                

 

  (F) Location and number of Borrower’s account with the Administrative Agent to
which proceeds of Borrowing are to be disbursed:

 

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

2 Which must comply with the definition of “Interest Period” and end not later
than the Revolving Facility Maturity Date.

3 Which must comply with the definition of “Interest Period”.

 

C-1-2

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

[The Borrower named below hereby represents and warrants that the conditions
specified in paragraphs (b) and (c) of Section 4.01 of the Credit Agreement are
satisfied]4

 

Very truly yours, SECURE COMPUTING CORPORATION By:  

 

Name:   Title:  

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

4 To be included in Borrowing Notices after the Closing Date.

 

C-1-3

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

EXHIBIT C-2

[FORM OF]

SWINGLINE BORROWING REQUEST

Citicorp USA, Inc.,

    as Administrative Agent

    for the Lenders referred to below

390 Greenwich Street

New York, New York

Attention:    Hector Guenther

Fax:               (646) 291-1650

[Date]

Ladies and Gentlemen:

Reference is made to the Credit Agreement, dated as of August [31], 2006 (as
amended, supplemented or otherwise modified from time to time, the “Credit
Agreement”), among SECURE COMPUTING CORPORATION, a Delaware corporation (the
“Borrower”), the Subsidiary Loan Party party thereto, the Lenders party thereto
from time to time, CITICORP USA, INC., as administrative agent (in such
capacity, the “Administrative Agent”) for the Lenders and as Swingline Lender,
CITIBANK, N.A., as Issuing Bank, UBS SECURITIES LLC, as syndication agent (in
such capacity, the “Syndication Agent”) and CITIGROUP GLOBAL MARKETS INC. and
UBS SECURITIES LLC, as joint lead arrangers (collectively and in such
capacities, the “Joint Lead Arrangers”) and as joint bookrunners. Terms defined
in the Credit Agreement are used herein with the same meanings. This notice
constitutes a Swingline Borrowing Request and the Borrower hereby requests
Borrowings under the Credit Agreement, and in that connection the Borrower
specifies the following information with respect to such Borrowings requested
hereby:

 

  (A) Type of Borrowing:                                      
                                                               

 

  (B) Aggregate Amount of Borrowing5:                                     
                                       

 

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

5 In the case of a Swingline Borrowing, not less than $500,000 and an integral
multiple of $100,000.

 

C-2-1

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

  (C) Date of Borrowing (which shall be a Business Day):                     

 

  (D) Location and number of Borrower’s account to which proceeds of Borrowing
are to be disbursed:                             

The Borrower named below hereby represents and warrants that the conditions
specified in paragraphs (b) and (c) of Section 4.01 of the Credit Agreement are
satisfied.

 

Very truly yours, SECURE COMPUTING CORPORATION By:  

 

Name:   Title:  

 

C-2-2

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

EXHIBIT D

GUARANTEE AND COLLATERAL AGREEMENT

dated and effective as of

August 31, 2006,

among

SECURE COMPUTING CORPORATION,

each other Subsidiary of Borrower

identified herein,

and

CITICORP USA, INC.,

as Administrative Agent

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

TABLE OF CONTENTS

 

 

         Page ARTICLE I.    Definitions   

Section 1.01.

 

Credit Agreement

   1

Section 1.02.

 

Other Defined Terms

   1 ARTICLE II.    Guarantee   

Section 2.01.

 

Guarantee

   5

Section 2.02.

 

Guarantee of Payment

   5

Section 2.03.

 

No Limitations, etc

   5

Section 2.04.

 

Reinstatement

   7

Section 2.05.

 

Agreement To Pay; Subrogation

   7

Section 2.06.

 

Information

   7

Section 2.07.

 

Maximum Liability

   7 ARTICLE III.    Pledge of Securities   

Section 3.01.

 

Pledge

   7

Section 3.02.

 

Delivery of the Pledged Collateral

   8

Section 3.03.

 

Representations, Warranties and Covenants

   9

Section 3.04.

 

Registration in Nominee Name; Denominations

   10

Section 3.05.

 

Voting Rights; Dividends and Interest, etc

   10 ARTICLE IV.    Security Interests in Other Personal Property   

Section 4.01.

 

Security Interest

   12

Section 4.02.

 

Representations and Warranties

   14

Section 4.03.

 

Covenants

   15

Section 4.04.

 

Other Actions

   18

Section 4.05.

 

Covenants Regarding Patent, Trademark and Copyright Collateral.

   20 ARTICLE V.    Remedies   

Section 5.01.

 

Remedies Upon Default

   21

Section 5.02.

 

Application of Proceeds

   23

Section 5.03.

 

Grant of License To Use Intellectual Property

   23

Section 5.04.

 

Securities Act, etc

   23

 

-i-

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

     Page ARTICLE VI.    Indemnity, Subrogation and Subordination   

Section 6.01.

 

Indemnity and Subrogation

   24

Section 6.02.

 

Contribution and Subrogation

   24

Section 6.03.

 

Subordination

   25 ARTICLE VII.    Miscellaneous   

Section 7.01.

 

Notices

   25

Section 7.02.

 

Security Interest Absolute

   25

Section 7.03.

 

Limitation By Law

   25

Section 7.04.

 

Binding Effect; Several Agreement

   25

Section 7.05.

 

Successors and Assigns

   26

Section 7.06.

 

Administrative Agent’s Fees and Expenses; Indemnification

   26

Section 7.07.

 

Administrative Agent Appointed Attorney-in-Fact

   26

Section 7.08.

 

GOVERNING LAW

   27

Section 7.09.

 

Waivers; Amendment

   27

Section 7.10.

 

WAIVER OF JURY TRIAL

   27

Section 7.11.

 

Severability

   28

Section 7.12.

 

Counterparts

   28

Section 7.13.

 

Headings

   28

Section 7.14.

 

Jurisdiction; Consent to Service of Process

   28

Section 7.15.

 

Termination or Release

   28

Section 7.16.

 

Additional Subsidiaries

   29

Section 7.17.

 

Right of Set-off

   29

Schedules

    

Schedule I

 

Pledged Stock; Debt Securities

  

Schedule II

 

Intellectual Property

  

Exhibits

    

Exhibit I

 

Form of Supplement to the Guarantee and Collateral Agreement

  

Exhibit II

 

Form of Perfection Certificate

  

Exhibit III

 

Form of Copyright Security Agreement

  

Exhibit IV

 

Form of Patent Security Agreement

  

Exhibit V

 

Form of Trademark Security Agreement

  

Exhibit VI

 

Form of Notice to Bailee of Security Interest in Inventory

  

Exhibit VII

 

Form of Control Agreement Concerning Deposit Accounts

  

Exhibit VIII

 

Form of Control Agreement Concerning Securities Accounts

  

Exhibit IX

 

Form of Landlord’s Access Agreement

  

 

-ii-

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

GUARANTEE AND COLLATERAL AGREEMENT dated and effective as of August 31, 2006
(this “Agreement”), among SECURE COMPUTING CORPORATION, a Delaware corporation
(the “Borrower”), each Subsidiary of the Borrower identified herein as a party
(each, a “Subsidiary Party”) and CITICORP USA, INC., as administrative agent (in
such capacity, the “Administrative Agent”) for the Secured Parties (as defined
below).

Reference is made to the credit agreement, dated as of the date hereof (as
amended, restated, supplemented, waived or otherwise modified from time to time,
the “Credit Agreement”), among the Borrower, the Lenders party thereto from time
to time, CITICORP USA, INC., as Administrative Agent for the Lenders, UBS
Securities LLC, as syndication agent, and Citigroup Global Markets Inc. and UBS
Securities LLC, as joint lead arrangers and as joint bookrunners.

The Lenders have agreed to extend credit to the Borrower subject to the terms
and conditions set forth in the Credit Agreement. The obligations of the Lenders
to extend such credit are conditioned upon, among other things, the execution
and delivery of this Agreement. The Subsidiary Parties are affiliates of the
Borrower, will derive substantial benefits from the extension of credit to the
Borrower pursuant to the Credit Agreement and are willing to execute and deliver
this Agreement in order to induce the Lenders to extend such credit.
Accordingly, the parties hereto agree as follows:

ARTICLE I.

DEFINITIONS

Section 1.01. Credit Agreement.

(a) Capitalized terms used in this Agreement and not otherwise defined herein
have the respective meanings assigned thereto in the Credit Agreement; provided
that the term “Letter of Credit”, for the purposes of Sections 4.01(a)(E) and
4.04(d) hereof only, shall have the meaning assigned to such term in the New
York UCC. All terms defined in the New York UCC (as defined herein) and not
defined in this Agreement have the meanings specified therein. The term
“instrument” shall have the meaning specified in Article 9 of the New York UCC.

(b) The rules of construction specified in Section 1.02 of the Credit Agreement
also apply to this Agreement.

Section 1.02. Other Defined Terms. As used in this Agreement, the following
terms have the meanings specified below:

“Account Debtor” means any person who is or who may become obligated to any
Pledgor under, with respect to or on account of an Account.

“Article 9 Collateral” has the meaning assigned to such term in Section 4.01.

“Bailee Letter” shall be an agreement in form substantially similar to Exhibit
VI hereto.

“Collateral” means Article 9 Collateral and Pledged Collateral.

“Control” shall mean (i) in the case of each Deposit Account, “control,” as such
term is defined in Section 9-104 of the UCC, (ii) in the case of any Security
Entitlement, “control,” as such term is defined in Section 8-106 of the UCC, and
(iii) in the case of any Commodity Contract, “control,” as such term is defined
in Section 9-106 of the UCC.

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

“Commodity Account Control Agreement” shall mean a control agreement in a form
that is reasonably satisfactory to the Administrative Agent establishing the
Collateral Agent’s Control with respect to any Commodity Account.

“Control Agreements” shall mean, collectively, the Deposit Account Control
Agreements, the Securities Account Control Agreements and the Commodity Account
Control Agreement.

“Copyright License” means any written agreement, now or hereafter in effect,
granting any right to any Pledgor under any Copyright now or hereafter owned by
any third party, and all rights of any Pledgor under any such agreement
(including, without limitation, any such rights that such Pledgor has the right
to license).

“Copyright Security Agreement” shall mean an agreement substantially in the form
of Exhibit III hereto.

“Copyrights” means all of the following now owned or hereafter acquired by any
Pledgor (or, as required in the context of the definition of “Copyright
License,” any third party licensor): (a) all copyright rights in any work
subject to the copyright laws of the United States or any other country, whether
as author, assignee, transferee or otherwise; and (b) all registrations and
applications for registration of any such Copyright in the United States or any
other country, including registrations, supplemental registrations and pending
applications for registration in the United States Copyright Office and the
right to obtain all renewals thereof, including those listed on Schedule II.

“Credit Agreement” has the meaning assigned to such term in the preliminary
statement of this Agreement.

“Deposit Accounts” shall mean, collectively, with respect to each Pledgor,
(i) all “deposit accounts” (as such term is defined in the UCC) that are
domiciled in the United States, and in any event shall include the LC Account
and all accounts and sub-accounts relating to any of the foregoing accounts and
(ii) all cash, funds, checks, notes and instruments from time to time on deposit
in any of the accounts or sub-accounts described in clause (i) of this
definition.

“Deposit Account Control Agreement” shall mean an agreement substantially in the
form of Exhibit VII hereto or such other form that is reasonably satisfactory to
the Administrative Agent establishing the Administrative Agent’s Control with
respect to any Deposit Account.

“Distributions” shall mean, collectively, with respect to each Pledgor, all
dividends, cash, options, warrants, rights, instruments, distributions, returns
of capital or principal, income, interest, profits and other property, interests
(debt or equity) or proceeds, including as a result of a split, revision,
reclassification or other like change of the Pledged Securities, from time to
time received, receivable or otherwise distributed to such Pledgor in respect of
or in exchange for any or all of the Pledged Securities or Intercompany Notes.

“Federal Securities Laws” has the meaning assigned to such term in Section 5.04.

“Foreign Pledge Agreement” has the meaning assigned to such term in
Section 3.01.

“General Intangibles” means all “General Intangibles” as defined in the New York
UCC, including Software, all choses in action and causes of action and all other
intangible personal property of any Pledgor of every kind and nature (other than
Accounts) now owned or hereafter acquired by any Pledgor, including corporate or
other business records, indemnification claims, contract rights (including

 

-2-

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

rights under leases, whether entered into as lessor or lessee, Swap Agreements
and other agreements), Intellectual Property, goodwill, registrations,
franchises, tax refund claims and any guarantee, claim, security interest or
other security held by or granted to any Pledgor to secure payment by an Account
Debtor of any of the Accounts.

“Guarantors” means the Subsidiary Parties, solely with respect to Obligations of
the other Loan Parties.

“Intellectual Property” means the collective reference to all rights, priorities
and privileges relating to intellectual and similar property of every kind and
nature now owned or hereafter acquired by any Pledgor, including, inventions,
designs, Patents, Copyrights, Trademarks, Patent Licenses, Copyright Licenses,
Trademark Licenses, trade secrets, domain names, confidential or proprietary
technical and business information, know-how, show-how or other data or
information and all related documentation.

“Intercompany Notes” shall mean, with respect to each Pledgor, all intercompany
notes described in Schedule 11 to the Perfection Certificate and intercompany
notes hereafter acquired by such Pledgor and all certificates, instruments or
agreements evidencing such intercompany notes, and all assignments, amendments,
restatements, supplements, extensions, renewals, replacements or modifications
thereof to the extent permitted pursuant to the terms hereof.

“Investment Property” shall mean a security, whether certificated or
uncertificated, Security Entitlement, Securities Account, Commodity Contract or
Commodity Account, excluding, however, the Securities Collateral.

“Landlord’s Access Agreement” shall mean an agreement substantially in the form
of Exhibit IX hereto or such other form that is reasonably satisfactory to the
Administrative Agent.

“LC Account” shall mean any account established and maintained in accordance
with the provisions of Section 2.05(a) of the Credit Agreement and all property
from time to time on deposit in such LC Account.

“Loan Document Obligations” means (a) the due and punctual payment by the
Borrower of (i) the unpaid principal of and interest (including interest
accruing during the pendency of any bankruptcy, insolvency, receivership or
other similar proceeding, regardless of whether allowed or allowable in such
proceeding) on the Loans made to the Borrower, when and as due, whether at
maturity, by acceleration, upon one or more dates set for prepayment or
otherwise, (ii) each payment required to be made by the Borrower under the
Credit Agreement in respect of any Letter of Credit (as defined in the Credit
Agreement), when and as due, including payments in respect of reimbursement of
disbursements, interest thereon (including interest accruing during the pendency
of any bankruptcy, insolvency, receivership or other similar proceeding,
regardless of whether allowed or allowable in such proceeding) and obligations
to provide cash collateral and (iii) all other monetary obligations of the
Borrower to any of the Secured Parties under the Credit Agreement and each of
the other Loan Documents, including obligations to pay fees, expense and
reimbursement obligations and indemnification obligations, whether primary,
secondary, direct, contingent, fixed or otherwise (including monetary
obligations incurred during the pendency of any bankruptcy, insolvency,
receivership or other similar proceeding, regardless of whether allowed or
allowable in such proceeding), (b) the due and punctual performance of all other
obligations of the Borrower under or pursuant to the Credit Agreement and each
of the other Loan Documents and (c) the due and punctual payment and performance
of all the obligations of each other Loan Party under or pursuant to this
Agreement and each of the other Loan Documents.

 

-3-

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

“New York UCC” means the Uniform Commercial Code as from time to time in effect
in the State of New York.

“Obligations” means (a) the Loan Document Obligations and (b) the due and
punctual payment and performance of all obligations of each Loan Party under
each Swap Agreement that (i) is in effect on the Closing Date with a
counterparty that is a Lender or an Affiliate of a Lender as of the Closing Date
or (ii) is entered into after the Closing Date with any counterparty that is a
Lender or an Affiliate of a Lender at the time such Swap Agreement is entered
into.

“Patent License” means any written agreement, now or hereafter in effect,
granting to any Pledgor any right to make, use or sell any invention covered by
a Patent, now or hereafter owned by any third party (including, without
limitation, any such rights that such Pledgor has the right to license).

“Patent Security Agreement” shall mean an agreement substantially in the form of
Exhibit IV hereto.

“Patents” means all of the following now owned or hereafter acquired by any
Pledgor (or, as required in the context of the definition of “Patent License,”
any third party licensor): (a) all letters patent of the United States or the
equivalent thereof in any other country or jurisdiction and all reissues and
extensions thereof, (b) all applications for letters patent of the United States
or the equivalent thereof in any other country or jurisdiction, and all
provisionals, continuations, divisions, continuations-in-part, reexaminations or
revisions thereof, including, in the case of (a) and (b), those patents and
applications listed on Schedule II, and (c) the inventions disclosed or claimed
therein, including the right to make, use and/or sell the inventions disclosed
or claimed therein.

“Perfection Certificate” means a certificate substantially in the form of
Exhibit II, completed and supplemented with the schedules and attachments
contemplated thereby, and duly executed by a Financial Officer of the Borrower
and each other Loan Party and the chief legal officer of the Borrower and each
other Loan Party.

“Pledged Collateral” has the meaning assigned to such term in Section 3.01.

“Pledged Debt Securities” has the meaning assigned to such term in Section 3.01.

“Pledged Securities” means any promissory notes, stock certificates or other
certificated securities now or hereafter included in the Pledged Collateral,
including all certificates, instruments or other documents representing or
evidencing any Pledged Collateral.

“Pledged Stock” has the meaning assigned to such term in Section 3.01.

“Pledgor” shall mean the Borrower and each Guarantor.

“Secured Parties” means (a) the Lenders, (b) the Administrative Agent, (c) each
Issuing Bank, (d) any Lender and any Affiliate of a Lender who is counterparty
to any Swap Agreement entered into with a Loan Party the obligations under which
constitute Obligations, (e) the beneficiaries of each indemnification obligation
undertaken by any Loan Party under any Loan Document and (f) the successors and
permitted assigns of each of the foregoing.

“Securities Account Control Agreement” shall mean an agreement substantially in
the form of Exhibit VIII hereto or such other form that is reasonably
satisfactory to the Administrative Agent establishing the Administrative Agent’s
Control with respect to any Securities Account.

 

-4-

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

“Securities Collateral” shall mean, collectively, the Pledged Securities, the
Intercompany Notes and the Distributions.

“Security Interest” has the meaning assigned to such term in Section 4.01.

“Subsidiary Party” has the meaning assigned to such term in the preliminary
statement of this Agreement.

“Trademark License” means any written agreement, now or hereafter in effect,
granting to any Pledgor any right to use any Trademark now or hereafter owned by
any third party (including, without limitation, any such rights that such
Pledgor has the right to license).

“Trademark Security Agreement” shall mean an agreement substantially in the form
of Exhibit V hereto.

“Trademarks” means all of the following now owned or hereafter acquired by any
Pledgor (or, as required in the context of the definition of “Trademark
License,” any third party licensor): (a) all trademarks, service marks,
corporate names, company names, business names, fictitious business names, trade
styles, trade dress, logos, other source or business identifiers, designs and
general intangibles of like nature, now existing or hereafter adopted or
acquired, all registrations thereof (if any), and all registration applications
filed in connection therewith, including registrations and registration
applications in the United States Patent and Trademark Office or any similar
offices in any State of the United States or any other country or any political
subdivision thereof, and all renewals thereof, including those listed on
Schedule II and (b) all goodwill associated therewith or symbolized thereby.

ARTICLE II.

GUARANTEE

Section 2.01. Guarantee. Each Guarantor unconditionally guarantees, jointly with
the other Guarantors and severally, to the Administrative Agent, for the benefit
of the Secured Parties, the due and punctual payment and performance of the
Obligations. Each Guarantor further agrees that the Obligations may be extended
or renewed, in whole or in part, without notice to or further assent from it,
and that it will remain bound upon its guarantee notwithstanding any extension
or renewal of any Obligation. Each Guarantor waives presentment to, demand of
payment from and protest to the Borrower and each Loan Party of any of the
Obligations, and also waives notice of acceptance of its guarantee and notice of
protest for nonpayment.

Section 2.02. Guarantee of Payment. Each Guarantor further agrees that its
guarantee hereunder constitutes a guarantee of payment when due (whether at the
stated maturity, by acceleration or otherwise) and not of collection, and waives
any right to require that any resort be had by the Administrative Agent or any
other Secured Party to any security held for the payment of the Obligations or
to any balance of any deposit account or credit on the books of the
Administrative Agent or any other Secured Party in favor of the Borrower or any
other person.

Section 2.03. No Limitations, etc.

(a) Except for termination of a Guarantor’s obligations hereunder as expressly
provided for in Section 7.15, the obligations of each Guarantor hereunder shall
not be subject to any reduction, limitation, impairment or termination for any
reason, including any claim of waiver, release, surrender, alteration or
compromise, and shall not be subject to any defense or setoff, counterclaim,

 

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recoupment or termination whatsoever by reason of the invalidity, illegality or
unenforceability of the Obligations or otherwise (other than defense of payment
or performance). Without limiting the generality of the foregoing, the
obligations of each Guarantor hereunder, to the fullest extent permitted by
applicable law, shall not be discharged or impaired or otherwise affected by:

(i) the failure of the Administrative Agent or any other Secured Party to assert
any claim or demand or to exercise or enforce any right or remedy under the
provisions of any Loan Document or otherwise;

(ii) any rescission, waiver, amendment or modification of, or any release from
any of the terms or provisions of, any Loan Document or any other agreement,
including with respect to any other Guarantor under this Agreement;

(iii) the failure to perfect any security interest in, or the exchange,
substitution, release or any impairment of, any security held by the
Administrative Agent or any other Secured Party for the Obligations;

(iv) any default, failure or delay, willful or otherwise, in the performance of
the Obligations;

(v) any other act or omission that may or might in any manner or to any extent
vary the risk of any Guarantor or otherwise operate as a discharge of any
Guarantor as a matter of law or equity (other than the payment in full in cash
or immediately available funds of all the Obligations);

(vi) any illegality, lack of validity or enforceability of any Obligation;

(vii) any change in the corporate existence, structure or ownership of the
Borrower, or any insolvency, bankruptcy, reorganization or other similar
proceeding affecting the Borrower or its assets or any resulting release or
discharge of any Obligation;

(viii) the existence of any claim, set-off or other rights that the Guarantor
may have at any time against the Borrower, the Administrative Agent, or any
other corporation or person, whether in connection herewith or any unrelated
transactions, provided that nothing herein will prevent the assertion of any
such claim by separate suit or compulsory counterclaim; or

(ix) any other circumstance (including without limitation, any statute of
limitations) or any existence of or reliance on any representation by the
Administrative Agent that might otherwise constitute a defense to, or a legal or
equitable discharge of, the Borrower or the Guarantor or any other guarantor or
surety.

Each Guarantor expressly authorizes the Secured Parties to take and hold
security for the payment and performance of the Obligations, to exchange, waive
or release any or all such security (with or without consideration), to enforce
or apply such security and direct the order and manner of any sale thereof in
their sole discretion or to release or substitute any one or more other
guarantors or obligors upon or in respect of the Obligations, all without
affecting the obligations of any Guarantor hereunder.

(b) To the fullest extent permitted by applicable law, each Guarantor waives any
defense based on or arising out of any defense of any other Loan Party or the
unenforceability of the Obligations or any part thereof from any cause, or the
cessation from any cause of the liability of any other Loan Party, other than
the payment in full in cash or immediately available funds of all the

 

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Obligations (other than contingent or unliquidated obligations or liabilities).
The Administrative Agent and the other Secured Parties may, at their election,
foreclose on any security held by one or more of them by one or more judicial or
nonjudicial sales, accept an assignment of any such security in lieu of
foreclosure, compromise or adjust any part of the Obligations, make any other
accommodation with any other Loan Party or exercise any other right or remedy
available to them against any other Loan Party, without affecting or impairing
in any way the liability of any Guarantor hereunder except to the extent the
Obligations (other than contingent or unliquidated obligations or liabilities)
have been paid in full in cash or immediately available funds. To the fullest
extent permitted by applicable law, each Guarantor waives any defense arising
out of any such election even though such election operates, pursuant to
applicable law, to impair or to extinguish any right of reimbursement or
subrogation or other right or remedy of such Guarantor against any other Loan
Party, as the case may be, or any security.

Section 2.04. Reinstatement. Each Guarantor agrees that its guarantee hereunder
shall continue to be effective or be reinstated, as the case may be, if at any
time payment, or any part thereof, of any Obligation is rescinded or must
otherwise be restored by the or any part thereof, of any Obligation is rescinded
or must otherwise be restored by the Administrative Agent or any other Secured
Party upon the bankruptcy or reorganization of the Borrower or any other Loan
Party or otherwise.

Section 2.05. Agreement To Pay; Subrogation. In furtherance of the foregoing and
not in limitation of any other right that the Administrative Agent or any other
Secured Party has at law or in equity against any Guarantor by virtue hereof,
upon the failure of the Borrower or any other Loan Party to pay any Obligation
when and as the same shall become due, whether at maturity, by acceleration,
after notice of prepayment or otherwise, each Guarantor hereby promises to and
will forthwith pay, or cause to be paid, to the Administrative Agent for
distribution to the applicable Secured Parties in cash the amount of such unpaid
Obligation. Upon payment by any Guarantor of any sums to the Administrative
Agent as provided above, all rights of such Guarantor against the Borrower, or
other Loan Party or any other Guarantor arising as a result thereof by way of
right of subrogation, contribution, reimbursement, indemnity or otherwise shall
in all respects be subject to Article VI.

Section 2.06. Information. Each Guarantor assumes all responsibility for being
and keeping itself informed of the financial condition and assets of the
Borrower and each other Loan Party, and of all other circumstances bearing upon
the risk of nonpayment of the Obligations and the nature, scope and extent of
the risks that such Guarantor assumes and incurs hereunder, and agrees that none
of the Administrative Agent or the other Secured Parties will have any duty to
advise such Guarantor of information known to it or any of them regarding such
circumstances or risks.

Section 2.07. Maximum Liability. Anything herein or in any other Loan Document
to the contrary notwithstanding, the maximum liability of each Guarantor
hereunder and under the other Loan Documents shall in no event exceed the amount
which can be guaranteed by such Guarantor under applicable federal and state
laws relating to the insolvency of debtors (after giving effect to the right of
contribution established in Section 6.02 hereof).

ARTICLE III.

PLEDGE OF SECURITIES

Section 3.01. Pledge. As security for the payment or performance, as the case
may be, in full of the Obligations, each Pledgor hereby assigns and pledges to
the Administrative Agent, for the benefit of the Secured Parties, and hereby
grants to the Administrative Agent, for the benefit of the Secured Parties, a
security interest in all of such Pledgor’s right, title and interest in, to and
under (a) the Equity Interests owned by it on the date hereof (which shall be
listed on Schedule I) and any other Equity

 

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Interests obtained in the future by such Pledgor and any certificates
representing all such Equity Interests (the “Pledged Stock”); provided that
(i) the Pledged Stock shall not include (A) more than 65% of the issued and
outstanding voting Equity Interests of any “first tier” Foreign Subsidiary
directly owned by such Pledgor, (B) any issued and outstanding Equity Interest
of any Foreign Subsidiary that is not a “first tier” Foreign Subsidiary, (C) to
the extent applicable law requires that a Subsidiary of such Pledgor issue
directors’ qualifying shares, such shares or nominee or other similar shares,
(D) any Equity Interests with respect to which the Collateral and Guarantee
Requirement or the other paragraphs of Section 5.10 of the Credit Agreement need
not be satisfied by reason of Section 5.10(g) of the Credit Agreement, or
(E) any Equity Interests of a person that is not directly or indirectly a
Subsidiary and (ii) to the extent any Equity Interests of a Foreign Subsidiary
are pledged pursuant to a pledge agreement governed by the jurisdiction of
organization of such Foreign Subsidiary (a “Foreign Pledge Agreement”) such
Foreign Pledge Agreement shall control; (b)(i) the debt obligations owed to each
Pledgor on the date hereof, including obligations listed opposite the name of
such Pledgor on Schedule I, (ii) any debt securities in the future issued to
such Pledgor and (iii) the certificates, promissory notes and any other
instruments, if any, evidencing such debt securities (the “Pledged Debt
Securities”); provided that the Pledged Debt Securities shall not include any
debt securities with respect to which the Collateral and Guarantee Requirement
or the other paragraphs of Section 5.10 of the Credit Agreement need not to be
satisfied by reason of Section 5.10(g) of the Credit Agreement; (c) subject to
Section 3.05 hereof, all payments of principal or interest, dividends, cash,
instruments and other property from time to time received, receivable or
otherwise distributed in respect of, in exchange for or upon the conversion of,
and all other proceeds received in respect of, the securities referred to in
clauses (a) and (b) above; (d) subject to Section 3.05 hereof, all rights and
privileges of such Pledgor with respect to the securities and other property
referred to in clauses (a), (b) and (c) above; and (e) all proceeds of any of
the foregoing (the items referred to in clauses (a) through (e) above being
collectively referred to as the “Pledged Collateral”)

TO HAVE AND TO HOLD the Pledged Collateral, together with all right, title,
interest, powers, privileges and preferences pertaining or incidental thereto,
unto the Administrative Agent, for the benefit of the Secured Parties, forever;
subject, however, to the terms, covenants and conditions hereinafter set forth.

Section 3.02. Delivery of the Pledged Collateral

(a) Each Pledgor agrees promptly to deliver or cause to be delivered to the
Administrative Agent, for the benefit of the Secured Parties, any and all
Pledged Securities to the extent such Pledged Securities, in the case of
promissory notes or other instruments evidencing Indebtedness, are required to
be delivered pursuant to paragraph (b) of this Section 3.02.

(b) Each Pledgor will cause any Indebtedness for borrowed money having an
aggregate principal amount in excess of $250,000 to the extent that a pledge of
such promissory note would not violate applicable law) owed to such Pledgor by
any person to be evidenced by a duly executed promissory note that is pledged
and delivered to the Administrative Agent, for the benefit of the Secured
Parties, pursuant to the terms hereof. To the extent any such promissory note is
a demand note, each Pledgor party thereto agrees, if requested by the
Administrative Agent, to immediately demand payment thereunder upon an Event of
Default specified under Section 7.01(b), (c), (f), (h) or (i) of the Credit
Agreement unless such demand would not be commercially reasonable or would
otherwise expose Pledgor to liability to the maker.

(c) Upon delivery to the Administrative Agent, (i) any Pledged Securities
required to be delivered pursuant to the foregoing paragraphs (a) and (b) of
this Section 3.02 shall be accompanied by stock powers or note powers, as
applicable, duly executed in blank or other instruments of transfer

 

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reasonably satisfactory to the Administrative Agent and by such other
instruments and documents as the Administrative Agent may reasonably request and
(ii) all other property composing part of the Pledged Collateral delivered
pursuant to the terms of this Agreement shall be accompanied to the extent
necessary to perfect the security interest in or allow realization on the
Pledged Collateral by proper instruments of assignment duly executed by the
applicable Pledgor and such other instruments or documents (including issuer
acknowledgments in respect of uncertificated securities) as the Administrative
Agent may reasonably request. Each delivery of Pledged Securities shall be
accompanied by a schedule describing the securities, which schedule shall be
attached hereto as Schedule I and made a part hereof; provided that failure to
attach any such schedule hereto shall not affect the validity of such pledge of
such Pledged Securities. Each schedule so delivered shall supplement any prior
schedules so delivered.

Section 3.03. Representations, Warranties and Covenants. The Pledgors, jointly
and severally, represent, warrant and covenant to and with the Administrative
Agent, for the benefit of the Secured Parties, that:

(a) Schedule I correctly sets forth the percentage of the issued and outstanding
shares of each class of the Equity Interests of the issuer thereof represented
by such Pledged Stock and includes all Equity Interests, debt securities and
promissory notes or instruments evidencing Indebtedness required to be pledged
hereunder in order to satisfy the Collateral and Guarantee Requirement;

(b) the Pledged Stock and Pledged Debt Securities (solely with respect to
Pledged Debt Securities issued by a person that is not a Subsidiary of Borrower
or an Affiliate of any such subsidiary, to the best of each Pledgor’s knowledge)
have been duly and validly authorized and issued by the issuers thereof and
(i) in the case of Pledged Stock, are fully paid and nonassessable and (ii) in
the case of Pledged Debt Securities (solely with respect to Pledged Debt
Securities issued by a person that is not a Subsidiary of Borrower or an
Affiliate of any such subsidiary, to the best of each Pledgor’s knowledge) are
legal, valid and binding obligations of the issuers thereof, subject to the
effects of bankruptcy, insolvency, fraudulent conveyance, reorganization,
moratorium and other similar laws relating to or affecting creditors’ rights
generally, general equitable principles (whether considered in a proceeding at
law or in equity) and an implied covenant of good faith and fair dealing;

(c) except for the security interests granted hereunder, each Pledgor (i) is
and, subject to any transfers made in compliance with the Credit Agreement, will
continue to be the direct owner, beneficially and of record, of the Pledged
Collateral indicated on Schedule I as owned by such Pledgor, (ii) holds the same
free and clear of all Liens, other than Liens permitted under Section 6.02 of
the Credit Agreement, (iii) will make no assignment, pledge, hypothecation or
transfer of, or create or permit to exist any security interest in or other Lien
on, the Pledged Collateral, other than pursuant to a transaction permitted by
the Credit Agreement and other than Liens permitted under Section 6.02 of the
Credit Agreement or arising by operation of law and (iv) subject to the rights
of such Pledgor under the Loan Documents to dispose of Pledged Collateral, will
use commercially reasonable efforts to defend its title or interest hereto or
therein against any and all Liens (other than Liens permitted under Section 6.02
of the Credit Agreement), however arising, of all persons;

(d) other than as set forth in the Credit Agreement or the schedules thereto,
and except for restrictions and limitations imposed by the Loan Documents or
securities laws generally or otherwise permitted to exist pursuant to the terms
of the Credit Agreement, the Pledged Collateral is and will continue to be
freely transferable and assignable, and none of the Pledged Collateral

 

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is or will be subject to any option, right of first refusal, shareholders
agreement, charter or by-law provisions or contractual restriction of any nature
that might prohibit, impair, delay or otherwise affect the pledge of such
Pledged Collateral hereunder, the sale or disposition thereof pursuant hereto or
the exercise by the Administrative Agent of rights and remedies hereunder;

(e) each Pledgor has the power and authority to pledge the Pledged Collateral
pledged by it hereunder in the manner hereby done or contemplated;

(f) other than as set forth in the Credit Agreement or the schedules thereto, no
consent or approval of any Governmental Authority, any securities exchange or
any other person was or is necessary to the validity of the pledge effected
hereby (other than such as have been obtained and are in full force and effect);

(g) by virtue of the execution and delivery by the Pledgors of this Agreement,
when any Pledged Securities are delivered to the Administrative Agent, for the
benefit of the Secured Parties, in accordance with this Agreement, the
Administrative Agent will obtain, for the benefit of the Secured Parties, a
legal, valid and perfected lien upon and security interest in such Pledged
Securities, subject only to Liens permitted under the Credit Agreement or
arising by operation of law, as security for the payment and performance of the
Obligations; and

(h) the pledge effected hereby is effective to vest in the Administrative Agent,
for the benefit of the Secured Parties, the rights of the Administrative Agent
in the Pledged Collateral as set forth herein.

Section 3.04. Registration in Nominee Name; Denominations. The Administrative
Agent, on behalf of the Secured Parties, shall have the right (in its sole and
absolute discretion) to hold the Pledged Securities in the name of the
applicable Pledgor, endorsed or assigned in blank or in favor of the
Administrative Agent or, if an Event of Default shall have occurred and be
continuing, in its own name as pledgee or the name of its nominee (as pledgee or
as sub-agent). Each Pledgor will promptly give to the Administrative Agent
copies of any notices or other communications received by it with respect to
Pledged Securities registered in the name of such Pledgor. If an Event of
Default shall have occurred and be continuing, the Administrative Agent shall
have the right to exchange the certificates representing Pledged Securities for
certificates of smaller or larger denominations for any purpose consistent with
this Agreement. Each Pledgor shall use its commercially reasonable efforts to
cause any Loan Party that is not a party to this Agreement to comply with a
request by the Administrative Agent, pursuant to this Section 3.04, to exchange
certificates representing Pledged Securities of such Loan Party for certificates
of smaller or larger denominations.

Section 3.05. Voting Rights; Dividends and Interest, etc.

(a) Unless and until an Event of Default shall have occurred and be continuing
and the Administrative Agent shall have given notice to the relevant Pledgors of
the Administrative Agent’s intention to exercise its rights hereunder:

(i) Each Pledgor shall be entitled to exercise any and all voting and/or other
consensual rights and powers inuring to an owner of Pledged Collateral or any
part thereof for any purpose consistent with the terms of this Agreement, the
Credit Agreement and the other Loan Documents; provided, that such rights and
powers shall not be exercised in any manner that could materially and adversely
affect the rights inuring to a holder of any Pledged Collateral, the rights and
remedies of any of the Administrative Agent or the other Secured Parties under
this Agreement, the Credit Agreement or any other Loan Document or the ability
of the Secured Parties to exercise the same.

 

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(ii) The Administrative Agent shall promptly execute and deliver to each
Pledgor, or cause to be executed and delivered to such Pledgor, all such
proxies, powers of attorney and other instruments as such Pledgor may reasonably
request for the purpose of enabling such Pledgor to exercise the voting and/or
consensual rights and powers it is entitled to exercise pursuant to subparagraph
(i) above.

(iii) Each Pledgor shall be entitled to receive and retain any and all
dividends, interest, principal and other distributions paid on or distributed in
respect of the Pledged Collateral to the extent and only to the extent that such
dividends, interest, principal and other distributions are permitted by, and
otherwise paid or distributed in accordance with, the terms and conditions of
the Credit Agreement, the other Loan Documents and applicable laws; provided
that any noncash dividends, interest, principal or other distributions that
would constitute Pledged Securities, whether resulting from a subdivision,
combination or reclassification of the outstanding Equity Interests of the
issuer of any Pledged Securities or received in exchange for Pledged Securities
or any part thereof, or in redemption thereof, or as a result of any merger,
consolidation, acquisition or other exchange of assets to which such issuer may
be a party or otherwise, shall be and become part of the Pledged Collateral,
and, if received by any Pledgor, shall not be commingled by such Pledgor with
any of its other funds or property but shall be held separate and apart
therefrom, shall be held in trust for the benefit of the Administrative Agent,
for the benefit of the Secured Parties, and shall be forthwith delivered to the
Administrative Agent, for the benefit of the Secured Parties, in the same form
as so received (endorsed in a manner reasonably satisfactory to the
Administrative Agent).

(b) Upon the occurrence and during the continuance of an Event of Default and
after notice by the Administrative Agent to the relevant Pledgors of the
Administrative Agent’s intention to exercise its rights hereunder, all rights of
any Pledgor to dividends, interest, principal or other distributions that such
Pledgor is authorized to receive pursuant to paragraph (a)(iii) of this
Section 3.05 shall cease, and all such rights shall thereupon become vested, for
the benefit of the Secured Parties, in the Administrative Agent which shall have
the sole and exclusive right and authority to receive and retain such dividends,
interest, principal or other distributions. All dividends, interest, principal
or other distributions received by any Pledgor contrary to the provisions of
this Section 3.05 shall not be commingled by such Pledgor with any of its other
funds or property but shall be held separate and apart therefrom, shall be held
in trust for the benefit of the Administrative Agent, for the benefit of the
Secured Parties, and shall be forthwith delivered to the Administrative Agent,
for the benefit of the Secured Parties, in the same form as so received
(endorsed in a manner reasonably satisfactory to the Administrative Agent). Any
and all money and other property paid over to or received by the Administrative
Agent pursuant to the provisions of this paragraph (b) shall be retained by the
Administrative Agent in an account to be established by the Administrative Agent
upon receipt of such money or other property and shall be applied in accordance
with the provisions of Section 5.02 hereof. After all Events of Default have
been cured or waived and the Borrower has delivered to the Administrative Agent
a certificate to that effect, the Administrative Agent shall promptly repay to
each Pledgor (without interest) all dividends, interest, principal or other
distributions that such Pledgor would otherwise be permitted to retain pursuant
to the terms of paragraph (a)(iii) of this Section 3.05 and that remain in such
account.

(c) Upon the occurrence and during the continuance of an Event of Default and
after notice by the Administrative Agent to the relevant Pledgors of the
Administrative Agent’s intention to exercise its rights hereunder, all rights of
any Pledgor to exercise the voting and/or consensual rights

 

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and powers it is entitled to exercise pursuant to paragraph (a)(i) of this
Section 3.05, and the obligations of the Administrative Agent under paragraph
(a)(ii) of this Section 3.05, shall cease, and all such rights shall thereupon
become vested in the Administrative Agent, for the benefit of the Secured
Parties, which shall have the sole and exclusive right and authority to exercise
such voting and consensual rights and powers; provided that, unless otherwise
directed by the Required Lenders, the Administrative Agent shall have the right
from time to time following and during the continuance of an Event of Default to
permit the Pledgors to exercise such rights. After all Events of Default have
been cured or waived and the Borrower has delivered to the Administrative Agent
a certificate to that effect, each Pledgor shall have the right to exercise the
voting and/or consensual rights and powers that such Pledgor would otherwise be
entitled to exercise pursuant to the terms of paragraph (a)(i) above.

ARTICLE IV.

SECURITY INTERESTS IN OTHER PERSONAL PROPERTY

Section 4.01. Security Interest.

(a) As security for the payment or performance when due (whether at the stated
maturity, by acceleration or otherwise), as the case may be, in full of the
Obligations, each Pledgor hereby pledges to the Administrative Agent, for the
benefit of the Secured Parties, and hereby grants to the Administrative Agent,
for the benefit of the Secured Parties, a security interest (the “Security
Interest”) in all right, title and interest in or to any and all of the
following assets and properties now owned or at any time hereafter acquired by
such Pledgor or in which such Pledgor now has or at any time in the future may
acquire any right, title or interest (collectively, the “Article 9 Collateral”):

(i) all Accounts;

(ii) all Chattel Paper;

(iii) all Documents;

(iv) all Goods, including Equipment and Inventory;

(v) all General Intangibles, including Software;

(vi) all Instruments;

(vii) all Investment Property (other than the Pledged Securities);

(viii) all Letters of Credit and Letter-of-Credit Rights;

(ix) all Commercial Tort Claims described in Schedule 13 to the Perfection
Certificate;

(x) all books and records pertaining to the Article 9 Collateral;

(xi) all Money and all Deposit Accounts;

(xii) all Supporting Obligations; and

 

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(xiii) to the extent not otherwise included, all proceeds, Supporting
Obligations and products of any and all of the foregoing and all collateral
security and guarantees given by any person with respect to any of the
foregoing.

Notwithstanding anything to the contrary in this Agreement, this Agreement shall
not constitute a grant of a security interest in (A) any vehicle covered by a
certificate of title or ownership, (B) any assets with respect to which the
Collateral and Guarantee Requirement or the other paragraphs of Section 5.10 of
the Credit Agreement need not be satisfied by reason of Section 5.10(g) of the
Credit Agreement, (C) any property excluded from the definition of Pledged
Collateral by virtue of the proviso to Section 3.01 hereof, (D) any assets
purchased with Indebtedness incurred pursuant to Section 6.01(h) of the Credit
Agreement, to the extent (and only for so long as) any contractual restriction
prevents such grant to the Administrative Agent, (E) any Letter of Credit Rights
to the extent any Pledgor is required by applicable law to apply the proceeds of
a drawing of such Letter of Credit for a specified purpose and to a person that
is not the Borrower or a Subsidiary of the Borrower, (F) any asset of a
Controlled Foreign Subsidiary (within the meaning of Treasury Regulation §
1.956-2(c)(2) or any successor provision thereto) or a subsidiary of a
Controlled Foreign Subsidiary, (G) any application for a Trademark registration
filed with the United States Patent and Trademark Office pursuant to
Section 1(b) of the Lanham Act (“Intent to Use Application”) prior to the filing
with and acceptance by the United States Patent and Trademark Office of a
Statement of Use (as described in Section 1(d) of the Lanham Act) or an
Amendment to Allege Use (as described in Section 1(c) of the Lanham Act), or
(H) any Pledgor’s right, title or interest in any license, contract or agreement
to which such Pledgor is a party or any of its right, title or interest
thereunder to the extent, but only to the extent, that such a grant would, under
the terms of such license, contract or agreement, result in a breach of the
terms of, or constitute a default under, any license, contract or agreement to
which such Pledgor is a party (other than to the extent that any such term would
be rendered ineffective pursuant to Section 9-406, 9-408 or 9-409 of the New
York UCC or any other applicable law (including, without limitation, Title 11 of
the United States Code) or principles of equity); provided, that immediately
upon the ineffectiveness, lapse or termination of any such provision, the
Collateral shall include, and such Grantor shall be deemed to have granted a
security interest in, all such rights and interests as if such provision had
never been in effect.

(b) Each Pledgor hereby irrevocably authorizes the Administrative Agent at any
time and from time to time to file in any relevant jurisdiction any initial
financing statements (including fixture filings) with respect to the Article 9
Collateral or any part thereof and amendments thereto that contain the
information required by Article 9 of the Uniform Commercial Code of each
applicable jurisdiction for the filing of any financing statement or amendment,
including (i) whether such Pledgor is an organization, the type of organization
and any organizational identification number issued to such Pledgor, (ii) in the
case of a financing statement filed as a fixture filing, a sufficient
description of the real property to which such Article 9 Collateral relates and
(iii) a description of collateral that describes such property in any other
manner as the Administrative Agent may reasonably determine is necessary or
advisable to ensure the perfection of the security interest in the Article 9
Collateral granted under this Agreement, including describing such property as
“all assets” or “all property”. Each Pledgor agrees to provide such information
to the Administrative Agent promptly upon request.

The Administrative Agent is further authorized to file with the United States
Patent and Trademark Office or United States Copyright Office (or any successor
office or any similar office in any other country) such documents as may be
reasonably necessary or advisable for the purpose of perfecting, confirming,
continuing, enforcing or protecting the Security Interest granted by each
Pledgor, without the signature of any Pledgor, and naming any Pledgor or the
Pledgors as debtors and the Administrative Agent as secured party.

 

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(c) The Security Interest is granted as security only and shall not subject the
Administrative Agent or any other Secured Party to, or in any way alter or
modify, any obligation or liability of any Pledgor with respect to or arising
out of the Article 9 Collateral.

Section 4.02. Representations and Warranties. The Pledgors jointly and severally
represent and warrant to the Administrative Agent and the Secured Parties that:

(a) Each Pledgor has good, and to each Pledgor’s knowledge, valid rights in and
title to the Article 9 Collateral with respect to which it has purported to
grant a Security Interest hereunder and has full power and authority to grant to
the Administrative Agent the Security Interest in such Article 9 Collateral
pursuant hereto and to execute, deliver and perform its obligations in
accordance with the terms of this Agreement, without the consent or approval of
any other person other than any consent or approval that has been obtained and
is in full force and effect or has otherwise been disclosed herein or in the
Credit Agreement.

(b) The Perfection Certificate has been duly prepared, completed and executed
and the information set forth therein, including the exact legal name of each
Pledgor, is correct and complete, in all material respects, as of the Closing
Date. The Uniform Commercial Code financing statements (including fixture
filings, as applicable) or other appropriate filings, recordings or
registrations containing a description of the Article 9 Collateral that have
been prepared by the Administrative Agent based upon the information provided to
the Administrative Agent in the Perfection Certificate for filing in each
governmental, municipal or other office specified in Schedule 7 to the
Perfection Certificate (or specified by notice from the Borrower to the
Administrative Agent after the Closing Date in the case of filings, recordings
or registrations required by Section 5.10 of the Credit Agreement) constitute
all the filings, recordings and registrations (other than filings to be made in
the United States Patent and Trademark Office or the United States Copyright
Office, as applicable, with respect to Article 9 Collateral consisting of United
States Patents, United States registered Trademarks and United States registered
Copyrights and applications thereof) that are necessary to publish notice of and
protect the validity of and to establish a legal, valid and perfected security
interest in favor of the Administrative Agent (for the benefit of the Secured
Parties) in respect of all Article 9 Collateral in which the Security Interest
may be perfected by filing, recording or registration in the United States (or
any political subdivision thereof) and its territories and possessions, and no
further or subsequent filing, refiling, recording, rerecording, registration or
reregistration is necessary in any such jurisdiction, except as provided under
applicable law with respect to the filing of continuation statements or
amendments. Each Pledgor represents and warrants that a fully executed agreement
in the form hereof (or a short form hereof which form shall be reasonably
acceptable to the Administrative Agent) containing a description of all Article
9 Collateral consisting of Intellectual Property with respect to United States
Patents (and Patents for which United States registration applications are
pending), United States registered Trademarks (and Trademarks for which United
States registration applications are pending, except for Intent to Use
Applications prior to the filing with and acceptance by the United States Patent
and Trademark Office of a Statement of Use or Amendment to Allege Use) and
United States registered Copyrights (and Copyrights for which United States
registration applications are pending) has been delivered to the Administrative
Agent for recording with the United States Patent and Trademark Office and the
United States Copyright Office pursuant to 35 U.S.C. § 261, 15 U.S.C. § 1060 or
17 U.S.C. § 205 and the regulations thereunder, as applicable, and reasonably
requested by the Administrative Agent, to protect the validity of and to
establish a legal, valid and perfected security interest in favor of the
Administrative Agent, for the benefit of the Secured Parties, in respect of all
Article 9 Collateral consisting of such Patents, Trademarks, or Copyrights in
which a security interest may be perfected by recording with the United States
Patent and Trademark Office or the United States Copyright Office, as
applicable, and no further or subsequent filing, refiling, recording,
rerecording, registration or reregistration is necessary (other than such

 

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actions as are necessary to perfect the Security Interest with respect to any
Article 9 Collateral consisting of Intent to Use Trademark applications (or
registrations issuing therefrom) following the acceptance of a Statement of Use
or Amendment to Allege Use, and of Patents, Trademarks and Copyrights (or
registration or application for registration thereof) acquired or developed
after the date hereof).

(c) The Security Interest constitutes (i) a legal and valid security interest in
all the Article 9 Collateral securing the payment and performance of the
Obligations, (ii) subject to the filings and other actions described in
Section 4.02(b), a perfected security interest in all Article 9 Collateral in
which a security interest may be perfected by possession or filing, recording or
registering a financing statement or analogous document in the United States (or
any political subdivision thereof) and its territories and possessions pursuant
to the Uniform Commercial Code or other applicable law in such jurisdictions and
(iii) a security interest that shall be perfected in all Article 9 Collateral in
which a security interest may be perfected upon the receipt and recording of
this Agreement (or a short form hereof) with the United States Patent and
Trademark Office or the United States Copyright Office, as applicable. The
Security Interest is and shall be prior to any other Lien on any of the Article
9 Collateral, other than Liens expressly permitted pursuant to Section 6.02 of
the Credit Agreement or arising by operation of law.

(d) The Article 9 Collateral is owned by the Pledgors free and clear of any
Lien, other than Liens expressly permitted pursuant to Section 6.02 of the
Credit Agreement. None of the Pledgors has filed or consented to the filing of
(i) any financing statement or analogous document under the Uniform Commercial
Code or any other applicable laws covering any Article 9 Collateral, (ii) any
assignment in which any Pledgor assigns any Article 9 Collateral or any security
agreement or similar instrument covering any Article 9 Collateral with the
United States Patent and Trademark Office or the United States Copyright Office
or (iii) any assignment in which any Pledgor assigns any Article 9 Collateral or
any security agreement or similar instrument covering any Article 9 Collateral
with any foreign governmental, municipal or other office, which financing
statement or analogous document, assignment, security agreement or similar
instrument is still in effect, except, in each case, for Liens expressly
permitted pursuant to Section 6.02 of the Credit Agreement.

(e) None of the Pledgors holds any Commercial Tort Claim individually in excess
of $250,000 as of the Closing Date except as indicated on the Perfection
Certificate.

(f) Except as set forth in the Perfection Certificate, as of the Closing Date,
all Accounts have been originated by the Pledgors and all Inventory has been
produced or acquired by the Pledgors in the ordinary course of business.

Section 4.03. Covenants.

(a) Each Pledgor agrees promptly to notify the Administrative Agent in writing
of any change (i) in its corporate or organization name, (ii) in its identity or
type of organization or corporate structure, (iii) in its Federal Taxpayer
Identification Number or organizational identification number or (iv) in its
jurisdiction of organization. Each Pledgor agrees promptly (and, in any event
within 30 Business Days or such longer period as otherwise reasonably agreed by
the Administrative Agent) to provide the Administrative Agent with certified
organizational documents reflecting any of the changes described in the
immediately preceding sentence. Each Pledgor agrees not to effect or permit any
change referred to in the first sentence of this paragraph (a) unless all
filings have been made, or will have been made within any applicable statutory
period, under the Uniform Commercial Code or otherwise that are required in
order for the Administrative Agent to continue at all times following such
change to have a valid, legal and perfected first priority security interest in
all the Article 9 Collateral, for the benefit of the Secured Parties. Each
Pledgor agrees promptly to notify the Administrative Agent if any material
portion of the Article 9 Collateral owned or held by such Pledgor is damaged or
destroyed.

 

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(b) Subject to the rights of such Pledgor under the Loan Documents to dispose of
Collateral, each Pledgor shall, at its own expense, use commercially reasonable
efforts to defend title to the Article 9 Collateral against all persons and to
defend the Security Interest of the Administrative Agent, for the benefit of the
Secured Parties, in the Article 9 Collateral and the priority thereof against
any Lien not expressly permitted pursuant to Section 6.02 of the Credit
Agreement.

(c) Each Pledgor agrees, at its own expense, to execute, acknowledge, deliver
and cause to be duly filed all such further instruments and documents and take
all such actions as the Administrative Agent may from time to time reasonably
request to better assure, preserve, protect and perfect the Security Interest
and the rights and remedies created hereby, including the payment of any fees
and taxes required in connection with the execution and delivery of this
Agreement, the granting of the Security Interest and the filing of any financing
statements (including fixture filings) or other documents in connection herewith
or therewith. If any amount payable under or in connection with any of the
Article 9 Collateral that shall be or become evidenced by any promissory note or
other instrument, such note or instrument shall be promptly pledged and
delivered to the Administrative Agent, for the benefit of the Secured Parties,
duly endorsed in a manner reasonably satisfactory to the Administrative Agent;
provided that no such note or instrument shall be required to be pledged to the
extent the amount thereof is less than $250,000.

Without limiting the generality of the foregoing, each Pledgor hereby authorizes
the Administrative Agent, with prompt notice thereof to the Pledgors, to
supplement this Agreement by supplementing Schedule II or adding additional
schedules hereto to specifically identify any asset or item that may constitute
Copyrights, Patents, Trademarks (other than Intent to Use Trademark
applications, until such time as a Statement of Use or Amendment to Allege Use
is filed with and accepted by the United States Patent and Trademark Office),
Copyright Licenses, Patent Licenses or Trademark Licenses; provided that any
Pledgor shall have the right, exercisable within 30 days after it has been
notified by the Administrative Agent of the specific identification of such
Article 9 Collateral, to advise the Administrative Agent in writing of any
inaccuracy of the representations and warranties made by such Pledgor hereunder
with respect to such Article 9 Collateral. Each Pledgor agrees that it will use
its commercially reasonable efforts to take such action as shall be necessary in
order that all representations and warranties hereunder shall be true and
correct with respect to such Article 9 Collateral within 30 days after the date
it has been notified by the Administrative Agent of the specific identification
of such Article 9 Collateral.

(d) After the occurrence of an Event of Default and during the continuance
thereof, the Administrative Agent shall have the right to verify under
reasonable procedures the validity, amount, quality, quantity, value, condition
and status of, or any other matter relating to, the Article 9 Collateral,
including, in the case of Accounts or Article 9 Collateral in the possession of
any third person, by contacting Account Debtors or the third person possessing
such Article 9 Collateral for the purpose of making such a verification. The
Administrative Agent shall have the right to share any information it gains from
such inspection or verification with any Secured Party.

(e) At its option, the Administrative Agent may discharge past due taxes,
assessments, charges, fees, Liens, security interests or other encumbrances at
any time levied or placed on the Article 9 Collateral and not permitted pursuant
to Section 6.02 of the Credit Agreement, and may pay for the maintenance and
preservation of the Article 9 Collateral to the extent any Pledgor fails to do
so as required by the Credit Agreement or this Agreement, and each Pledgor
jointly and severally agrees to reimburse the Administrative Agent on demand for
any reasonable payment made or any reasonable expense

 

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incurred by the Administrative Agent pursuant to the foregoing authorization;
provided, however, that nothing in this Section 4.03(e) shall be interpreted as
excusing any Pledgor from the performance of, or imposing any obligation on the
Administrative Agent or any Secured Party to cure or perform, any covenants or
other promises of any Pledgor with respect to taxes, assessments, charges, fees,
Liens, security interests or other encumbrances and maintenance as set forth
herein or in the other Loan Documents.

(f) Each Pledgor (rather than the Administrative Agent or any Secured Party)
shall remain liable for the observance and performance of all the conditions and
obligations to be observed and performed by it under each contract, agreement or
instrument relating to the Article 9 Collateral and each Pledgor jointly and
severally agrees to indemnify and hold harmless the Administrative Agent and the
Secured Parties from and against any and all liability for such performance.

(g) None of the Pledgors shall make or permit to be made an assignment, pledge
or hypothecation of the Article 9 Collateral or shall grant any other Lien in
respect of the Article 9 Collateral, except as expressly permitted by the Credit
Agreement. None of the Pledgors shall make or permit to be made any transfer of
the Article 9 Collateral and each Pledgor shall remain at all times in
possession of the Article 9 Collateral owned by it, except as permitted by the
Credit Agreement.

(h) None of the Pledgors will, without the Administrative Agent’s prior written
consent (which consent shall not be unreasonably withheld), grant any extension
of the time of payment of any Accounts included in the Article 9 Collateral,
compromise, compound or settle the same for less than the full amount thereof,
release, wholly or partly, any person liable for the payment thereof or allow
any credit or discount whatsoever thereon, other than extensions, credits,
discounts, compromises or settlements granted or made in the ordinary course of
business and consistent with prudent business practices.

(i) Each Pledgor irrevocably makes, constitutes and appoints the Administrative
Agent (and all officers, employees or agents designated by the Administrative
Agent) as such Pledgor’s true and lawful agent (and attorney-in-fact) for the
purpose, during the continuance of an Event of Default, of making, settling and
adjusting claims in respect of Article 9 Collateral under policies of insurance,
endorsing the name of such Pledgor on any check, draft, instrument or other item
of payment for the proceeds of such policies of insurance and for making all
determinations and decisions with respect thereto. In the event that any Pledgor
at any time or times shall fail to obtain or maintain any of the policies of
insurance required hereby or to pay any premium in whole or part relating
thereto, the Administrative Agent may, without waiving or releasing any
obligation or liability of the Pledgors hereunder or any Event of Default, in
its sole discretion, obtain and maintain such policies of insurance and pay such
premium and take any other actions with respect thereto as the Administrative
Agent reasonably deems advisable. All sums disbursed by the Administrative Agent
in connection with this Section 4.03(i), including reasonable attorneys’ fees,
court costs, expenses and other charges relating thereto, shall be payable, upon
demand, by the Pledgors to the Administrative Agent and shall be additional
Obligations secured hereby.

(j) From and after the occurrence of an Event of Default, to the extent
requested by the Administrative Agent, the Pledgors shall comply with the
Assignment of Claims Act of 1940, 31 U.S.C. § 3727(c), with respect to each
Pledgor’s contracts with the U.S. government or any branch, agency, bureau or
subdivision thereof.

 

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Section 4.04. Other Actions. In order to further ensure the attachment,
perfection and priority of, and the ability of the Administrative Agent to
enforce, for the benefit of the Secured Parties, the Administrative

Agent’s security interest in the Article 9 Collateral, each Pledgor agrees, in
each case at such Pledgor’s own expense, to take the following actions with
respect to the following Article 9 Collateral:

(a) Instruments and Tangible Chattel Paper. If any Pledgor shall at any time
hold or acquire any Instruments or Tangible Chattel Paper, such Pledgor shall
forthwith endorse, assign and deliver the same to the Administrative Agent,
accompanied by such instruments of transfer or assignment duly executed in blank
as the Administrative Agent may from time to time reasonably request; provided
that no such Instrument or Tangible Chattel Paper shall be required to be
pledged to the extent the amount thereof is less than $250,000.

(b) Investment Property. Except to the extent otherwise provided in Article III,
if any Pledgor shall at any time hold or acquire any Certificated Security, such
Pledgor shall forthwith endorse, assign and deliver the same to the
Administrative Agent, accompanied by such instruments of transfer or assignment
duly executed in blank as the Administrative Agent may from time to time
reasonably specify. If any security of a domestic issuer now owned or hereafter
acquired by any Pledgor is uncertificated and is issued to such Pledgor or its
nominee directly by the issuer thereof, upon the Administrative Agent’s
reasonable request and upon and during the continuance of an Event of Default,
such Pledgor shall promptly notify the Administrative Agent of such
uncertificated securities and pursuant to an agreement in form and substance
reasonably satisfactory to the Administrative Agent, either (i) cause the issuer
to agree to comply with instructions from the Administrative Agent as to such
security, without further consent of any Pledgor or such nominee, or (ii) cause
the issuer to register the Administrative Agent as the registered owner of such
security.

(c) Commercial Tort Claims. If any Pledgor shall at any time hold or acquire a
Commercial Tort Claim in an amount reasonably estimated to exceed $250,000, such
Pledgor shall promptly, and in any event within 15 Business Days, notify the
Administrative Agent thereof in a writing signed by such Pledgor, including a
summary description of such claim, and grant to the Administrative Agent in
writing a security interest therein and in the proceeds thereof, all under the
terms and provisions of this Agreement, with such writing to be in form and
substance reasonably satisfactory to the Administrative Agent.

(d) Letter-of-Credit Rights. If any Pledgor is at any time a beneficiary under a
Letter of Credit now or hereafter issued (other than a Letter of Credit referred
to in clause (E) of Section 4.01(a) or that constitutes a “supporting
obligation” as defined in UCC 9-102(a)(77)), such Pledgor shall promptly notify
the Administrative Agent thereof and such Pledgor shall, at the request of the
Administrative Agent, pursuant to an agreement in form and substance reasonably
satisfactory to the Administrative Agent, either (i) arrange for the issuer and
any confirmer of such Letter of Credit to consent to an assignment to the
Administrative Agent of the proceeds of any drawing under the Letter of Credit
or (ii) arrange for the Administrative Agent to become the transferee
beneficiary of such Letter of Credit, with the Administrative Agent agreeing, in
each case, that the proceeds of any drawing under the Letter of Credit are to be
applied as provided in the Credit Agreement. The actions in the preceding
sentence shall not (i) be required to the extent that the aggregate amounts of
any such Letters of Credit does not exceed $5.0 million and (ii) apply to any
trade Letters of Credit that have been issued in the ordinary course of
business; provided that the issuing bank of any such trade Letter of Credit
shall have been instructed to deposit all proceeds from any such trade Letter of
Credit into a Deposit Account over which the Administrative Agent has a first
priority security interest, which security interest is perfected by Control.

 

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(e) Landlord’s Access Agreements/Bailee Letters. Each Pledgor shall use its
commercially reasonable efforts to obtain as soon as practicable after the date
hereof with respect to each location set forth in Schedule 8(a) to the
Perfection Certificate, where such Pledgor maintains Pledged Collateral, a
Bailee Letter and/or Landlord Access Agreement, as applicable, and use
commercially reasonable efforts to obtain a Bailee Letter, Landlord’s Access
Agreement and/or landlord’s lien waiver, as applicable, from all such bailees
and landlords, as applicable, who from time to time have possession of any
Pledged Collateral if reasonably requested by the Administrative Agent. A waiver
of bailee’s lien shall not be required if the value of the Pledged Collateral
held by such bailee is less then $50,000, provided that the aggregate value of
the Pledged Collateral held by all bailees who have not delivered a Bailee
Letter is less than $250,000 in the aggregate.

(f) Deposit Accounts. As of the date hereof, no Pledgor has any Deposit Accounts
other than the accounts listed in Schedule 14 to the Perfection Certificate. The
Administrative Agent has a first priority security interest in each such Deposit
Account, which security interest is perfected by Control. No Pledgor shall
hereafter establish and maintain any Deposit Account unless (1) it shall have
given the Administrative Agent 30 days’ prior written notice of its intention to
establish such new Deposit Account with a Bank, (2) such Bank shall be
reasonably acceptable to the Administrative Agent and (3) such Bank and such
Pledgor shall have duly executed and delivered to the Administrative Agent a
Deposit Account Control Agreement with respect to such Deposit Account. The
Administrative Agent agrees with each Pledgor that the Administrative Agent
shall not give any instructions directing the disposition of funds from time to
time credited to any Deposit Account or withhold any withdrawal rights from such
Pledgor with respect to funds from time to time credited to any Deposit Account
unless an Event of Default has occurred and is continuing. The provisions of
this Section 4.04(f) shall not apply to the LC Account or to any other Deposit
Accounts for which the Administrative Agent is the Bank. No Pledgor shall grant
Control of any Deposit Account to any person other than the Administrative
Agent.

(g) Securities Accounts and Commodity Accounts. (i) As of the date hereof, no
Pledgor has any Securities Accounts or Commodity Accounts other than those
listed in Schedule 14 to the Perfection Certificate. The Administrative Agent
has a first priority security interest in each such Securities Account and
Commodity Account, which security interest is perfected by Control. No Pledgor
shall hereafter establish and maintain any Securities Account or Commodity
Account with any Securities Intermediary or Commodity Intermediary unless (1) it
shall have given the Administrative Agent 30 days’ prior written notice of its
intention to establish such new Securities Account or Commodity Account with
such Securities Intermediary or Commodity Intermediary, (2) such Securities
Intermediary or Commodity Intermediary shall be reasonably acceptable to the
Administrative Agent and (3) such Securities Intermediary or Commodity
Intermediary, as the case may be, and such Pledgor shall have duly executed and
delivered a Control Agreement with respect to such Securities Account or
Commodity Account, as the case may be. Each Pledgor shall accept any cash and
Investment Property in trust for the benefit of the Administrative Agent and
within one (1) Business Day of actual receipt thereof, deposit any and all cash
and Investment Property received by it into a Deposit Account or Securities
Account subject to Administrative Agent’s Control. The Administrative Agent
agrees with each Pledgor that the Administrative Agent shall not give any
Entitlement Orders or instructions or directions to any issuer of uncertificated
securities, Securities Intermediary or Commodity Intermediary, and shall not
withhold its consent to the exercise of any withdrawal or dealing rights by such
Pledgor, unless an Event of Default has occurred and is continuing or, after
giving effect to any such investment and withdrawal rights, would occur. The
provisions of this Section 4.04(g) shall not

 

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apply to any Financial Assets credited to a Securities Account for which the
Administrative Agent is the Securities Intermediary. No Pledgor shall grant
Control over any Investment Property to any person other than the Administrative
Agent.

(ii) As between the Administrative Agent and the Pledgors, the Pledgors shall
bear the investment risk with respect to the Investment Property and Pledged
Securities, and the risk of loss of, damage to, or the destruction of the
Investment Property and Pledged Securities, whether in the possession of, or
maintained as a Security Entitlement or deposit by, or subject to the Control
of, the Administrative Agent, a Securities Intermediary, a Commodity
Intermediary, any Pledgor or any other person.

Section 4.05. Covenants Regarding Patent, Trademark and Copyright Collateral.

(a) Each Pledgor agrees that it will not knowingly do any act or omit to do any
act (and will exercise commercially reasonable efforts to prevent its licensees
from doing any act or omitting to do any act) whereby any Patent that, in such
Pledgor’s reasonable business judgment, is material to the normal conduct of
such Pledgor’s business may become prematurely invalidated or dedicated to the
public, and agrees that it shall take commercially reasonable steps with respect
to any material products covered by any such Patent as necessary and sufficient
to establish and preserve its rights under applicable patent laws. Each Pledgor
will, and will use its commercially reasonable efforts to cause its licensees or
its sublicensees to, for each material Trademark that, in such Pledgor’s
reasonable business judgment, is necessary to the normal conduct of such
Pledgor’s business, (i) maintain such Trademark in full force free from any
adjudication of abandonment or invalidity for non-use, (ii) maintain the quality
of products and services offered under such Trademark, (iii) display such
Trademark with notice of federal or foreign registration or claim of trademark
or service mark as required under applicable law and (iv) not knowingly use or
knowingly permit its licensees’ use of such Trademark in violation of any
third-party rights.

(b) Each Pledgor will, and will use its commercially reasonable efforts to cause
its licensees or its sublicensees to, for each work covered by a material
Copyright that, in such Pledgor’s reasonable business judgment, is necessary to
the normal conduct of such Pledgor’s business that it publishes, displays and
distributes, use copyright notice as required under applicable copyright laws.

(c) Each Pledgor shall notify the Administrative Agent promptly if it knows that
any Patent, Trademark or Copyright that, in such Pledgor’s reasonable business
judgment, is material to the normal conduct of such Pledgor’s business may
imminently become abandoned, lost or dedicated to the public, or of any
materially adverse determination, excluding office actions and similar
determinations in the United States Patent and Trademark Office or the United
States Copyright Office, regarding such Pledgor’s ownership of any such material
Patent, Trademark or Copyright or its right to register or to maintain the same.

(d) Each Pledgor, either itself or through any agent, employee, licensee or
designee, shall (i) inform the Administrative Agent on a quarterly basis (at the
time of delivery of the quarterly financial statements pursuant to
Section 5.04(b) of the Credit Agreement and annual financial statements pursuant
to Section 5.04(a) of the Credit Agreement) of each application by itself, or
through any agent, employee, licensee or designee, for any Patent with the
United States Patent and Trademark Office and each registration of any Trademark
or Copyright with the United States Patent and Trademark Office or the United
States Copyright Office filed during the preceding three-month period, and
(ii) execute and file any and all agreements, instruments, documents and papers
as are necessary or as the Administrative Agent may reasonably request to
evidence the Administrative Agent’s security interest in such Patent, Trademark
or Copyright.

 

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(e) Each Pledgor shall exercise its reasonable business judgment consistent with
the practice in any proceeding before the United States Patent and Trademark
Office or the United States Copyright Office with respect to maintaining and
pursuing each material application relating to any Patent, Trademark and/or
Copyright (and obtaining the relevant grant or registration) that, in such
Pledgor’s reasonable business judgment, is material to the normal conduct of
such Pledgor’s business and to maintain (i) each issued Patent and (ii) the
registrations of each Trademark and each Copyright that is, in such Pledgor’s
reasonable business judgment, material to the normal conduct of such Pledgor’s
business, including, when applicable and necessary in such Pledgor’s reasonable
business judgment, timely filings of applications for renewal, affidavits of
use, affidavits of incontestability and payment of maintenance fees, and, if any
Pledgor believes necessary in its reasonable business judgment, to initiate
opposition, interference and cancellation proceedings against third parties.

(f) In the event that any Pledgor knows or has reason to know that any Article 9
Collateral consisting of a Patent, Trademark or Copyright that, in such
Pledgor’s reasonable business judgment, is material to the normal conduct of its
business has been or is about to be materially infringed, misappropriated or
diluted by a third party, such Pledgor shall promptly notify the Administrative
Agent and shall, if such Pledgor deems it necessary in its reasonable business
judgment, promptly sue and recover any and all damages, and take such other
actions as are reasonably appropriate under the circumstances.

(g) Upon and during the continuance of an Event of Default, each Pledgor shall
use commercially reasonable efforts to obtain all requisite consents or
approvals from the licensor under each Copyright License, Patent License or
Trademark License to effect the assignment of all such Pledgor’s right, title
and interest thereunder to (in the Administrative Agent’s sole discretion) the
designee of the Administrative Agent or the Administrative Agent.

ARTICLE V.

REMEDIES

Section 5.01. Remedies Upon Default. Upon the occurrence and during the
continuance of an Event of Default, each Pledgor agrees to deliver each item of
Collateral to the Administrative Agent on demand, and it is agreed that the
Administrative Agent shall have the right to take any of or all the following
actions at the same or different times: (a) with respect to any Article 9
Collateral consisting of Intellectual Property, on demand, to cause the Security
Interest to become an assignment, transfer and conveyance of any of or all such
Article 9 Collateral by the applicable Pledgors to the Administrative Agent or
to license or sublicense, whether general, special or otherwise, and whether on
an exclusive or a nonexclusive basis, any such Article 9 Collateral throughout
the world on such terms and conditions and in such manner as the Administrative
Agent shall determine (other than in violation of any then-existing licensing
arrangements to the extent that waivers thereunder cannot be obtained), (b) with
or without legal process and with or without prior notice or demand for
performance, to take possession of the Article 9 Collateral and without
liability for trespass to the applicable Pledgor to enter any premises where the
Article 9 Collateral may be located for the purpose of taking possession of or
removing the Article 9 Collateral and, generally, to exercise any and all rights
afforded to a secured party under the applicable Uniform Commercial Code or
other applicable law and (c) seek a court order directing every U.S. government
or any branch, agency, bureau or subdivision thereof which is under a contract
with any Pledgor or any subsidiary thereof to make such payments directly to the
Administrative Agent. Without limiting the generality

 

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of the foregoing, each Pledgor agrees that the Administrative Agent shall have
the right, subject to the mandatory requirements of applicable law, to sell or
otherwise dispose of all or any part of the Collateral at a public or private
sale or at any broker’s board or on any securities exchange, for cash, upon
credit or for future delivery as the Administrative Agent shall deem
appropriate. The Administrative Agent shall be authorized in connection with any
sale of a security (if it deems it advisable to do so) pursuant to the foregoing
to restrict the prospective bidders or purchasers to persons who represent and
agree that they are purchasing such security for their own account, for
investment, and not with a view to the distribution or sale thereof. Upon
consummation of any such sale of Collateral pursuant to this Section 5.01 the
Administrative Agent shall have the right to assign, transfer and deliver to the
purchaser or purchasers thereof the Collateral so sold. Each such purchaser at
any such sale shall hold the property sold absolutely, free from any claim or
right on the part of any Pledgor, and each Pledgor hereby waives and releases
(to the extent permitted by law) all rights of redemption, stay, valuation and
appraisal that such Pledgor now has or may at any time in the future have under
any rule of law or statute now existing or hereafter enacted.

The Administrative Agent shall give the applicable Pledgors 10 days’ written
notice (which each Pledgor agrees is reasonable notice within the meaning of
Section 9-611 of the New York UCC or its equivalent in other jurisdictions) of
the Administrative Agent’s intention to make any sale of Collateral. Such
notice, in the case of a public sale, shall state the time and place for such
sale and, in the case of a sale at a broker’s board or on a securities exchange,
shall state the board or exchange at which such sale is to be made and the day
on which the Collateral, or portion thereof, will first be offered for sale at
such board or exchange. Any such public sale shall be held at such time or times
within ordinary business hours and at such place or places as the Administrative
Agent may fix and state in the notice (if any) of such sale. At any such sale,
the Collateral, or the portion thereof, to be sold may be sold in one lot as an
entirety or in separate parcels, as the Administrative Agent may (in its sole
and absolute discretion) determine. The Administrative Agent shall not be
obligated to make any sale of any Collateral if it shall determine not to do so,
regardless of the fact that notice of sale of such Collateral shall have been
given. The Administrative Agent may, without notice or publication, adjourn any
public or private sale or cause the same to be adjourned from time to time by
announcement at the time and place fixed for sale, and such sale may, without
further notice, be made at the time and place to which the same was so
adjourned. In the case of any sale of all or any part of the Collateral made on
credit or for future delivery, the Collateral so sold shall be retained by the
Administrative Agent until the sale price is paid by the purchaser or purchasers
thereof, but the Administrative Agent shall not incur any liability in the event
that any such purchaser or purchasers shall fail to take up and pay for the
Collateral so sold and, in the case of any such failure, such Collateral may be
sold again upon notice given in accordance with provisions above. At any public
(or, to the extent permitted by law, private) sale made pursuant to this
Section 5.01, any Secured Party may bid for or purchase for cash, free (to the
extent permitted by law) from any right of redemption, stay, valuation or
appraisal on the part of any Pledgor (all such rights being also hereby waived
and released to the extent permitted by law), the Collateral or any part thereof
offered for sale and such Secured Party may, upon compliance with the terms of
sale, hold, retain and dispose of such property in accordance with Section 5.02
hereof without further accountability to any Pledgor therefor. For purposes
hereof, a written agreement to purchase the Collateral or any portion thereof
shall be treated as a sale thereof; the Administrative Agent shall be free to
carry out such sale pursuant to such agreement and no Pledgor shall be entitled
to the return of the Collateral or any portion thereof subject thereto,
notwithstanding the fact that after the Administrative Agent shall have entered
into such an agreement all Events of Default shall have been remedied and the
Obligations paid in full. As an alternative to exercising the power of sale
herein conferred upon it, the Administrative Agent may proceed by a suit or
suits at law or in equity to foreclose this Agreement and to sell the Collateral
or any portion thereof pursuant to a judgment or decree of a court or courts
having competent jurisdiction or pursuant to a proceeding by a court-appointed
receiver. Any sale pursuant to the provisions of this Section 5.01 shall be
deemed to conform to the commercially reasonable standards as provided in
Section 9-610(b) of the New York UCC or its equivalent in other jurisdictions.

 

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Section 5.02. Application of Proceeds. The Administrative Agent shall promptly
apply the proceeds, moneys or balances of any collection or sale of Collateral,
as well as any Collateral consisting of cash, as follows:

FIRST, to the payment of all costs and expenses incurred by the Administrative
Agent in connection with such collection or sale or otherwise in connection with
this Agreement, any other Loan Document or any of the Obligations, including all
court costs and the fees and expenses of its agents and legal counsel, the
repayment of all advances made by the Administrative Agent hereunder or under
any other Loan Document on behalf of any Pledgor and any other costs or expenses
incurred in connection with the exercise of any right or remedy hereunder or
under any other Loan Document;

SECOND, to the payment in full of the Obligations (the amounts so applied to be
distributed among the Secured Parties pro rata in accordance with the respective
amounts of the Obligations owed to them on the date of any such distribution);
and

THIRD, to the Pledgors, their successors or assigns, or as a court of competent
jurisdiction may otherwise direct.

The Administrative Agent shall have absolute discretion as to the time of
application of any such proceeds, moneys or balances in accordance with this
Agreement. Upon any sale of Collateral by the Administrative Agent (including
pursuant to a power of sale granted by statute or under a judicial proceeding),
the receipt of the purchase money by the Administrative Agent or of the officer
making the sale shall be a sufficient discharge to the purchaser or purchasers
of the Collateral so sold and such purchaser or purchasers shall not be
obligated to see to the application of any part of the purchase money paid over
to the Administrative Agent or such officer or be answerable in any way for the
misapplication thereof.

Section 5.03. Grant of License To Use Intellectual Property. For the purpose of
enabling the Administrative Agent to exercise rights and remedies under this
Agreement at such time as the Administrative Agent shall be lawfully entitled to
exercise such rights and remedies, each Pledgor hereby grants to (in the
Administrative Agent’s sole discretion) a designee of the Administrative Agent
or the Administrative Agent, for the benefit of the Secured Parties, an
irrevocable, non-exclusive license (exercisable without payment of royalty or
other compensation to any Pledgor) to use, license or sublicense any of the
Article 9 Collateral consisting of Intellectual Property now owned or hereafter
acquired by such Pledgor, wherever the same may be located, and including,
without limitation, in such license reasonable access to all media in which any
of the licensed items may be recorded or stored and to all computer software and
programs used for the compilation or printout thereof, the right to prosecute
and maintain all intellectual property and the right to sue or its designee for
past infringement of the intellectual property. The use of such license by the
Administrative Agent may be exercised, at the option of the Administrative
Agent, only upon the occurrence and during the continuation of an Event of
Default; provided that any license, sublicense or other transaction entered into
by the Administrative Agent or its designee in accordance herewith shall be
binding upon the Pledgors notwithstanding any subsequent cure of an Event of
Default.

Section 5.04. Securities Act, etc. In view of the position of the Pledgors in
relation to the Pledged Collateral, or because of other current or future
circumstances, a question may arise under the Securities Act of 1933, as now or
hereafter in effect, or any similar federal statute hereafter enacted analogous
in purpose or effect (such Act and any such similar statute as from time to time
in effect being

 

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called the “Federal Securities Laws”) with respect to any disposition of the
Pledged Collateral permitted hereunder. Each Pledgor understands that compliance
with the Federal Securities Laws might very strictly limit the course of conduct
of the Administrative Agent if the Administrative Agent were to attempt to
dispose of all or any part of the Pledged Collateral, and might also limit the
extent to which or the manner in which any subsequent transferee of any Pledged
Collateral could dispose of the same. Similarly, there may be other legal
restrictions or limitations affecting the Administrative Agent in any attempt to
dispose of all or part of the Pledged Collateral under applicable Blue Sky or
other state securities laws or similar laws analogous in purpose or effect. Each
Pledgor acknowledges and agrees that in light of such restrictions and
limitations, the Administrative Agent, in its sole and absolute discretion,
(a) may proceed to make such a sale whether or not a registration statement for
the purpose of registering such Pledged Collateral or part thereof shall have
been filed under the Federal Securities Laws or, to the extent applicable, Blue
Sky or other state securities laws and (b) may approach and negotiate with a
single potential purchaser to effect such sale. Each Pledgor acknowledges and
agrees that any such sale might result in prices and other terms less favorable
to the seller than if such sale were a public sale without such restrictions. In
the event of any such sale, the Administrative Agent shall incur no
responsibility or liability for selling all or any part of the Pledged
Collateral at a price that the Administrative Agent, in its sole and absolute
discretion, may in good faith deem reasonable under the circumstances,
notwithstanding the possibility that a substantially higher price might have
been realized if the sale were deferred until after registration as aforesaid or
if more than a single purchaser were approached. The provisions of this
Section 5.04 will apply notwithstanding the existence of a public or private
market upon which the quotations or sales prices may exceed substantially the
price at which the Administrative Agent sells.

ARTICLE VI.

INDEMNITY, SUBROGATION AND SUBORDINATION

Section 6.01. Indemnity and Subrogation. In addition to all such rights of
indemnity and subrogation as the Guarantors may have under applicable law (but
subject to Section 6.03 hereof), the Borrower agrees that (a) in the event a
payment shall be made by any Guarantor under this Agreement in respect of any
Obligation of the Borrower, the Borrower shall indemnify such Guarantor for the
full amount of such payment and such Guarantor shall be subrogated to the rights
of the person to whom such payment shall have been made to the extent of such
payment and (b) in the event any assets of any Guarantor shall be sold pursuant
to this Agreement or any other Security Document to satisfy in whole or in part
an Obligation of the Borrower, the Borrower shall indemnify such Guarantor in an
amount equal to the greater of the book value or the fair market value of the
assets so sold.

Section 6.02. Contribution and Subrogation. Each Guarantor (a “Contributing
Guarantor”) agrees (subject to Section 6.03 hereof) that, in the event a payment
shall be made by any other Guarantor hereunder in respect of any Obligation or
assets of any other Guarantor shall be sold pursuant to any Security Document to
satisfy any Obligation owed to any Secured Party and such other Guarantor (the
“Claiming Guarantor”) shall not have been fully indemnified by the Borrower as
provided in Section 6.01 hereof, the Contributing Guarantor shall indemnify the
Claiming Guarantor in an amount equal to the amount of such payment or the
greater of the book value or the fair market value of such assets, as
applicable, in each case multiplied by a fraction of which the numerator shall
be the net worth of such Contributing Guarantor on the date hereof and the
denominator shall be the aggregate net worth of all the Guarantors on the date
hereof (or, in the case of any Guarantor becoming a party hereto pursuant to
Section 7.16 hereof, the date of the supplement hereto executed and delivered by
such Guarantor). Any Contributing Guarantor making any payment to a Claiming
Guarantor pursuant to this Section 6.02 shall be subrogated to the rights of
such Claiming Guarantor under Section 6.01 hereof to the extent of such payment.

 

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Section 6.03. Subordination.

(a) Notwithstanding any provision of this Agreement to the contrary, all rights
of the Guarantors under Sections 6.01 and 6.02 hereof and all other rights of
indemnity, contribution or subrogation of the Guarantors under applicable law or
otherwise shall be fully subordinated to the payment in full in cash or
immediately available funds of the Obligations (other than contingent or
unliquidated obligations or liabilities). No failure on the part of the Borrower
or any Guarantor to make the payments required by Sections 6.01 and 6.02 hereof
(or any other payments required under applicable law or otherwise) shall in any
respect limit the obligations and liabilities of such Borrower or any Guarantor
with respect to its Obligations, and the Borrower and each Guarantor shall
remain liable for the full amount of its Obligations.

(b) Each Guarantor hereby agrees that all Indebtedness and other monetary
obligations owed by it to the Borrower, any other Guarantor or any Subsidiary
shall be fully subordinated to the payment in full in cash or immediately
available funds of the Obligations (other than contingent or unliquidated
obligations or liabilities).

ARTICLE VII.

MISCELLANEOUS

Section 7.01. Notices. All communications and notices hereunder shall (except as
otherwise expressly permitted herein) be in writing and given as provided in
Section 9.01 of the Credit Agreement. All communications and notices hereunder
to any Subsidiary Party shall be given to it in care of the Borrower, with such
notice to be given as provided in Section 9.01 of the Credit Agreement.

Section 7.02. Security Interest Absolute. All rights of the Administrative Agent
hereunder, the Security Interest in the Article 9 Collateral, the security
interest in the Pledged Collateral and all obligations of each Pledgor hereunder
shall be absolute and unconditional irrespective of (a) any lack of validity or
enforceability of the Credit Agreement, any other Loan Document, any agreement
with respect to any of the Obligations or any other agreement or instrument
relating to any of the foregoing, (b) any change in the time, manner or place of
payment of, or in any other term of, all or any of the Obligations, or any other
amendment or waiver of or any consent to any departure from the Credit
Agreement, any other Loan Document or any other agreement or instrument, (c) any
exchange, release or non-perfection of any Lien on other collateral, or any
release or amendment or waiver of or consent under or departure from any
guarantee, securing or guaranteeing all or any of the Obligations or (d) any
other circumstance that might otherwise constitute a defense available to, or a
discharge of, any Pledgor in respect of the Obligations or this Agreement (other
than a defense of payment or performance).

Section 7.03. Limitation By Law. All rights, remedies and powers provided in
this Agreement may be exercised only to the extent that the exercise thereof
does not violate any applicable provision of law, and all the provisions of this
Agreement are intended to be subject to all applicable mandatory provisions of
law that may be controlling and to be limited to the extent necessary so that
they shall not render this Agreement invalid, unenforceable, in whole or in
part, or not entitled to be recorded, registered or filed under the provisions
of any applicable law.

Section 7.04. Binding Effect; Several Agreement. This Agreement shall become
effective as to any party to this Agreement when a counterpart hereof executed
on behalf of such party shall have been delivered to the Administrative Agent
and a counterpart hereof shall have been executed on behalf of the
Administrative Agent, and thereafter shall be binding upon such party and the
Administrative Agent and their respective permitted successors and assigns, and
shall inure to the benefit of such

 

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party, the Administrative Agent and the other Secured Parties and their
respective permitted successors and assigns, except that no party shall have the
right to assign or transfer its rights or obligations hereunder or any interest
herein or in the Collateral (and any such assignment or transfer shall be void)
except as expressly contemplated by this Agreement or the Credit Agreement. This
Agreement shall be construed as a separate agreement with respect to each party
and may be amended, modified, supplemented, waived or released with respect to
any party without the approval of any other party and without affecting the
obligations of any other party hereunder.

Section 7.05. Successors and Assigns. Whenever in this Agreement any of the
parties hereto is referred to, such reference shall be deemed to include the
permitted successors and assigns of such party; and all covenants, promises and
agreements by or on behalf of any Pledgor or the Administrative Agent that are
contained in this Agreement shall bind and inure to the benefit of their
respective permitted successors and assigns; provided that no Pledgor may
assign, transfer or delegate any of its rights or obligations under this
Agreement without the prior written consent of the Administrative Agent.

Section 7.06. Administrative Agent’s Fees and Expenses; Indemnification.

(a) The parties hereto agree that the Administrative Agent shall be entitled to
reimbursement of its expenses incurred hereunder as provided in Section 9.05 of
the Credit Agreement. Without limitation of its indemnification obligations
under the other Loan Documents, each Pledgor jointly and severally agrees to
indemnify the Administrative Agent and the other Indemnitees (as defined in
Section 9.05 of the Credit Agreement) against, and hold each Indemnitee harmless
from, any and all losses, claims, damages, liabilities and related expenses,
including reasonable counsel fees, charges and disbursements, incurred by or
asserted against any Indemnitee arising out of, in connection with, or as a
result of, (i) the execution, delivery or performance of this Agreement or any
other Loan Document or any agreement or instrument contemplated hereby or
thereby, the performance by the parties hereto and thereto of their respective
obligations thereunder or the consummation of the Transactions and other
transactions contemplated hereby, (ii) the use of proceeds of the Loans or the
use of any Letter of Credit or (iii) any claim, litigation, investigation or
proceeding relating to any of the foregoing, or to the Collateral, whether or
not any Indemnitee is a party thereto; provided that such indemnity shall not,
as to any Indemnitee, be available to the extent that such losses, claims,
damages, liabilities or related expenses are determined by a court of competent
jurisdiction by final and nonappealable judgment to have resulted from the gross
negligence or willful misconduct of such Indemnitee.

(b) Any such amounts payable as provided hereunder shall be additional
Obligations secured hereby and by the other Security Documents. The provisions
of this Section 7.06 shall remain operative and in full force and effect
regardless of the termination of this Agreement or any other Loan Document, the
consummation of the transactions contemplated hereby, the repayment of any of
the Obligations, the invalidity or unenforceability of any term or provision of
this Agreement or any other Loan Document, or any investigation made by or on
behalf of the Administrative Agent or any other Secured Party. All amounts due
under this Section 7.06 shall be payable on written demand therefor.

Section 7.07. Administrative Agent Appointed Attorney-in-Fact. Each Pledgor
hereby appoints the Administrative Agent the attorney-in-fact of such Pledgor
for the purpose of carrying out the provisions of this Agreement and taking any
action and executing any instrument that the Administrative Agent may deem
necessary or advisable to accomplish the purposes hereof, which appointment is
irrevocable and coupled with an interest. The Administrative Agent shall have
the right, upon the occurrence and during the continuance of an Event of
Default, with full power of substitution either in the Administrative Agent’s
name or in the name of such Pledgor, (a) to receive, endorse, assign or deliver
any and all

 

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notes, acceptances, checks, drafts, money orders or other evidences of payment
relating to the Collateral or any part thereof; (b) to demand, collect, receive
payment of, give receipt for and give discharges and releases of all or any of
the Collateral; (c) to ask for, demand, sue for, collect, receive and give
acquittance for any and all moneys due or to become due under and by virtue of
any Collateral; (d) to sign the name of any Pledgor on any invoice or bill of
lading relating to any of the Collateral; (e) to send verifications of Accounts
to any Account Debtor; (f) to commence and prosecute any and all suits, actions
or proceedings at law or in equity in any court of competent jurisdiction to
collect or otherwise realize on all or any of the Collateral or to enforce any
rights in respect of any Collateral; (g) to settle, compromise, compound, adjust
or defend any actions, suits or proceedings relating to all or any of the
Collateral; (h) to notify, or to require any Pledgor to notify, Account Debtors
to make payment directly to the Administrative Agent; and (i) to use, sell,
assign, transfer, pledge, make any agreement with respect to or otherwise deal
with all or any of the Collateral, and to do all other acts and things necessary
to carry out the purposes of this Agreement, as fully and completely as though
the Administrative Agent were the absolute owner of the Collateral for all
purposes; provided, that nothing herein contained shall be construed as
requiring or obligating the Administrative Agent to make any commitment or to
make any inquiry as to the nature or sufficiency of any payment received by the
Administrative Agent, or to present or file any claim or notice, or to take any
action with respect to the Collateral or any part thereof or the moneys due or
to become due in respect thereof or any property covered thereby. The
Administrative Agent and the other Secured Parties shall be accountable only for
amounts actually received as a result of the exercise of the powers granted to
them herein, and neither they nor their officers, directors, employees or agents
shall be responsible to any Pledgor for any act or failure to act hereunder,
except for their own gross negligence or willful misconduct.

Section 7.08. GOVERNING LAW. THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF
THE PARTIES UNDER THIS AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH AND
GOVERNED BY THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO CONFLICTS OF
LAW PRINCIPLES THAT WOULD REQUIRE THE APPLICATION OF THE LAWS OF ANOTHER
JURISDICTION.

Section 7.09. Waivers; Amendment.

No failure or delay by the Administrative Agent, any Issuing Bank or any Lender
in exercising any right, power or remedy hereunder or under any other Loan
Document shall operate as a waiver thereof, nor shall any single or partial
exercise of any such right, power or remedy, or any abandonment or
discontinuance of steps to enforce such a right, power or remedy, preclude any
other or further exercise thereof or the exercise of any other right, power or
remedy. The rights, powers and remedies of the Administrative Agent, any Issuing
Bank and the Lenders hereunder and under the other Loan Documents are cumulative
and are not exclusive of any rights, powers or remedies that they would
otherwise have. Without limiting the generality of the foregoing, the making of
a Loan or the issuance of a Letter of Credit shall not be construed as a waiver
of any Default or Event of Default, regardless of whether the Administrative
Agent, any Lender or any Issuing Bank may have had notice or knowledge of such
Default or Event of Default at the time. No notice or demand on any Loan Party
in any case shall entitle any Loan Party to any other or further notice or
demand in similar or other circumstances. Neither this Agreement nor any
provision hereof may be waived, amended or modified except pursuant to an
agreement or agreements in writing entered into by the Administrative Agent and
the Loan Party or Loan Parties with respect to which such waiver, amendment or
modification is to apply, subject to any consent required in accordance with
Section 9.08 of the Credit Agreement.

Section 7.10. WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY WAIVES, TO THE
FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT

 

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MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY
ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS AGREEMENT OR ANY OTHER LOAN
DOCUMENTS. EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR
ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH
OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING
WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN
INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS
AND CERTIFICATIONS IN THIS SECTION 7.10.

Section 7.11. Severability. In the event any one or more of the provisions
contained in this Agreement or in any other Loan Document should be held
invalid, illegal or unenforceable in any respect, the validity, legality and
enforceability of the remaining provisions contained herein and therein shall
not in any way be affected or impaired thereby. The parties shall endeavor in
good-faith negotiations to replace the invalid, illegal or unenforceable
provisions with valid provisions the economic effect of which comes as close as
possible to that of the invalid, illegal or unenforceable provisions.

Section 7.12. Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall constitute an original but all of which when
taken together shall constitute but one contract, and shall become effective as
provided in Section 7.04 hereof. Delivery of an executed counterpart to this
Agreement by facsimile transmission shall be as effective as delivery of a
manually signed original.

Section 7.13. Headings. Article and Section headings and the Table of Contents
used herein are for convenience of reference only, are not part of this
Agreement and are not to affect the construction of, or to be taken into
consideration in interpreting, this Agreement.

Section 7.14. Jurisdiction; Consent to Service of Process.

(a) Each party to this Agreement hereby irrevocably and unconditionally submits,
for itself and its property, to the nonexclusive jurisdiction of any New York
State court or federal court of the United States of America sitting in New York
City, and any appellate court from any thereof, in any action or proceeding
arising out of or relating to this Agreement or any other Loan Documents, or for
recognition or enforcement of any judgment, and each of the parties hereto
hereby irrevocably and unconditionally agrees that all claims in respect of any
such action or proceeding may be heard and determined in such New York State or,
to the extent permitted by law, in such federal court. Each of the parties
hereto agrees that a final judgment in any such action or proceeding shall be
conclusive and may be enforced in other jurisdictions by suit on the judgment or
in any other manner provided by law. Nothing in this Agreement shall affect any
right that the Administrative Agent, any Issuing Bank or any Lender may
otherwise have to bring any action or proceeding relating to this Agreement or
any other Loan Document against any Pledgor, or its properties, in the courts of
any jurisdiction.

(b) Each party to this Agreement hereby irrevocably and unconditionally waives,
to the fullest extent it may legally and effectively do so, any objection which
it may now or hereafter have to the laying of venue of any suit, action or
proceeding arising out of or relating to this Agreement or any other Loan
Document in any New York State or federal court. Each of the parties hereto
hereby irrevocably waives, to the fullest extent permitted by law, the defense
of an inconvenient forum to the maintenance of such action or proceeding in any
such court.

 

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Section 7.15. Termination or Release.

(a) This Agreement, the guarantees made herein, the pledges made herein, the
Security Interest and all other security interests granted hereby shall
terminate when all the Loan Document Obligations (other than contingent or
unliquidated obligations or liabilities not then due) have been paid in full in
cash or immediately available funds and the Lenders have no further commitment
to lend under the Credit Agreement, the Revolving L/C Exposure has been reduced
to zero and each Issuing Bank has no further obligations to issue Letters of
Credit under the Credit Agreement.

(b) A Subsidiary Party shall automatically be released from its obligations
hereunder and the security interests in the Collateral of such Subsidiary Party
shall be automatically released upon the consummation of any transaction
permitted by the Credit Agreement as a result of which such Subsidiary Party
ceases to be a Subsidiary of the Borrower or otherwise ceases to be a Guarantor;
provided that the Required Lenders shall have consented to such transaction (to
the extent such consent is required by the Credit Agreement) and the terms of
such consent did not provide otherwise.

(c) Upon any sale or other transfer by any Pledgor of any Collateral that is
permitted under the Credit Agreement to any person that is not a Pledgor, or
upon the effectiveness of any written consent to the release of the security
interest granted hereby in any Collateral pursuant to Section 9.08 of the Credit
Agreement, the security interest in such Collateral shall be automatically
released.

(d) In connection with any termination or release pursuant to paragraph (a),
(b) or (c) of this Section 7.15, the Administrative Agent shall execute and
deliver to any Pledgor, at such Pledgor’s expense, all documents that such
Pledgor shall reasonably request to evidence such termination or release. Any
execution and delivery of documents pursuant to this Section 7.15 shall be
without recourse to or warranty by the Administrative Agent.

Section 7.16. Additional Subsidiaries. Upon execution and delivery by the
Administrative Agent and any Subsidiary that is required to become a party
hereto by Section 5.10 of the Credit Agreement of an instrument in the form of
Exhibit I hereto, such Subsidiary shall become a Subsidiary Party hereunder with
the same force and effect as if originally named as a Subsidiary Party herein.
The execution and delivery of any such instrument shall not require the consent
of any other party to this Agreement. The rights and obligations of each party
to this Agreement shall remain in full force and effect notwithstanding the
addition of any new party to this Agreement.

Section 7.17. Right of Set-off. If an Event of Default shall have occurred and
be continuing, each Lender and each Issuing Bank is hereby authorized at any
time and from time to time, to the fullest extent permitted by law, to set-off
and apply any and all deposits (general or special, time or demand, provisional
or final) at any time held and other indebtedness at any time owing by such
Lender or such Issuing Bank to or for the credit or the account of any party to
this Agreement against any of and all the obligations of such party now or
hereafter existing under this Agreement owed to such Lender or such Issuing
Bank, irrespective of whether or not such Lender or such Issuing Bank shall have
made any demand under this Agreement and although such obligations may be
unmatured. The rights of each Lender under this Section 7.17 are in addition to
other rights and remedies (including other rights of set-off) that such Lender
or such Issuing Bank may have.

 

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IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement as of
the day and year first above written.

 

SECURE COMPUTING CORPORATION By:  

 

Name:   Title:   CIPHERTRUST, INC. By:  

 

Name:   Title:     CITICORP USA, INC., as Administrative Agent By:  

 

Name:   Title:   By:  

 

Name:   Title:  

 

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ACKNOWLEDGEMENT AND CONSENT

The undersigned hereby (i) acknowledges receipt of a copy of the Guarantee and
Collateral Agreement (as amended, amended and restated, supplemented or
otherwise modified from time to time, the “Guarantee and Collateral Agreement”,
capitalized terms used but not otherwise defined herein shall have the meanings
assigned to such terms in the Guarantee and Collateral Agreement), dated as of
August 31, 2006, made by the Pledgors parties thereto for the benefit of
Citicorp USA, Inc., as Administrative Agent, (ii) agrees promptly to note on its
books the security interests granted to the Administrative Agent and confirmed
under the Guarantee and Collateral Agreement, (iii) agrees that it will comply
with instructions of the Administrative Agent with respect to the applicable
Pledged Securities without further consent by the applicable Pledgor,
(iv) agrees to notify the Administrative Agent upon obtaining knowledge of any
interest in favor of any person in the applicable Pledged Securities that is
adverse to the interest of the Administrative Agent therein and (v) waives any
right or requirement at any time hereafter to receive a copy of the Guarantee
and Collateral Agreement in connection with (a) the registration of any
Securities Collateral thereunder in the name of the Administrative Agent, or its
nominees or (b) the exercise of voting rights by the Administrative Agent, or
its nominees.

The undersigned acknowledges that its Equity Interests have been pledged
pursuant to the terms of the Guarantee and Collateral Agreement and will comply
with all actions that may be required of it pursuant to Section 3.05 and
Section 4.04(b) thereof.

 

[NAME OF ISSUER] By:  

 

Name:   Title:   Address for Notices:

 

 

 

Fax:  

 

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Exhibit I

to the Guarantee and

Collateral Agreement

SUPPLEMENT NO.              dated as of                      (this
“Supplement”), to the Guarantee and Collateral Agreement dated as of August 31,
2006 (the “Guarantee and Collateral Agreement”), among SECURE COMPUTING
CORPORATION (the “Borrower”), each Subsidiary Party thereto and CITICORP USA,
INC., as administrative agent (in such capacity, the “Administrative Agent”) for
the Secured Parties (as defined herein).

A. Reference is made to the Credit Agreement dated as of the date hereof (as
amended, restated, supplemented, waived or otherwise modified from time to time,
the “Credit Agreement”), among the Borrower, the Lenders party thereto from time
to time, Citicorp USA, Inc., as Administrative Agent for the Lenders, UBS
Securities LLC, as syndication agent, and Citigroup Global Markets Inc. and UBS
Securities LLC, as joint lead arrangers and as joint bookrunners.

B. Capitalized terms used herein and not otherwise defined herein shall have the
meanings assigned to such terms in the Credit Agreement and the Guarantee and
Collateral Agreement referred to therein.

C. The Guarantors have entered into the Guarantee and Collateral Agreement in
order to induce the Lenders to make Loans and each Issuing Bank to issue Letters
of Credit. Section 7.16 of the Guarantee and Collateral Agreement provides that
additional Subsidiaries may become Subsidiary Parties under the Guarantee and
Collateral Agreement by execution and delivery of an instrument in the form of
this Supplement. The undersigned Subsidiary (the “New Subsidiary”) is executing
this Supplement in accordance with the requirements of the Credit Agreement to
become a Subsidiary Party under the Guarantee and Collateral Agreement in order
to induce the Lenders to make additional Loans and each Issuing Bank to issue
additional Letters of Credit and as consideration for Loans previously made and
Letters of Credit previously issued.

Accordingly, the Administrative Agent and the New Subsidiary agree as follows:

SECTION 1. In accordance with Section 7.16 of the Guarantee and Collateral
Agreement, the New Subsidiary by its signature below becomes a Subsidiary Party
and a Guarantor under the Guarantee and Collateral Agreement with the same force
and effect as if originally named therein as a Subsidiary Party and a Guarantor,
and the New Subsidiary hereby (a) agrees to all the terms and provisions of the
Guarantee and Collateral Agreement applicable to it as a Subsidiary Party and
Guarantor thereunder and (b) represents and warrants that the representations
and warranties made by it as a Guarantor thereunder are true and correct, in all
material respects, on and as of the date hereof. In furtherance of the
foregoing, the New Subsidiary, as security for the payment and performance in
full of the Obligations (as defined in the Guarantee and Collateral Agreement),
does hereby create and grant to the Administrative Agent, for the benefit of the
Secured Parties, a security interest in and Lien on all the New Subsidiary’s
right, title and interest in and to the Collateral (as defined in the Guarantee
and Collateral Agreement) of the New Subsidiary. Each reference to a “Subsidiary
Party” or a “Guarantor” in the Guarantee and Collateral Agreement shall be
deemed to include the New Subsidiary. The Guarantee and Collateral Agreement is
hereby incorporated herein by reference.

SECTION 2. The New Subsidiary represents and warrants to the Administrative
Agent and the other Secured Parties that this Supplement has been duly
authorized, executed and delivered by it and constitutes its legal, valid and
binding obligation, enforceable against it in accordance with its terms, subject
to (i) the effects of bankruptcy, insolvency, moratorium, reorganization,
fraudulent conveyance or

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

other similar laws affecting creditors’ rights generally, (ii) general
principles of equity (regardless of whether such enforceability is considered in
a proceeding in equity or at law) and (iii) implied covenants of good faith and
fair dealing.

SECTION 3. This Agreement may be executed in two or more counterparts, each of
which shall constitute an original but all of which when taken together shall
constitute but one contract. This Supplement shall become effective when (a) the
Administrative Agent shall have received a counterpart of this Supplement that
bears the signature of the New Subsidiary and (b) the Administrative Agent has
executed a counterpart hereof.

SECTION 4. The New Subsidiary hereby represents and warrants that (a) set forth
on Schedule I attached hereto is a true and correct schedule of the location of
any and all Article 9 Collateral of the New Subsidiary, (b) set forth on
Schedule II attached hereto is a true and correct schedule of all the Pledged
Securities of the New Subsidiary and (c) set forth under its signature hereto,
is the true and correct legal name of the New Subsidiary, its jurisdiction of
formation and the location of its chief executive office.

SECTION 5. Except as expressly supplemented hereby, the Guarantee and Collateral
Agreement shall remain in full force and effect.

SECTION 6. THIS SUPPLEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES UNDER
THIS SUPPLEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS
OF THE STATE OF NEW YORK, WITHOUT REGARD TO CONFLICTS OF LAW PRINCIPLES THAT
WOULD REQUIRE THE APPLICATION OF THE LAWS OF ANOTHER JURISDICTION.

SECTION 7. In the event any one or more of the provisions contained in this
Supplement should be held invalid, illegal or unenforceable in any respect, the
validity, legality and enforceability of the remaining provisions contained
herein and in the Guarantee and Collateral Agreement shall not in any way be
affected or impaired thereby. The parties shall endeavor in good-faith
negotiations to replace the invalid, illegal or unenforceable provisions with
valid provisions the economic effect of which comes as close as possible to that
of the invalid, illegal or unenforceable provisions.

SECTION 8. All communications and notices hereunder shall be in writing and
given as provided in Section 7.01 of the Guarantee and Collateral Agreement.

SECTION 9. The New Subsidiary agrees to reimburse the Administrative Agent for
its reasonable out-of-pocket expenses in connection with this Supplement,
including the reasonable fees, disbursements and other charges of counsel for
the Administrative Agent; provided that such expenses may instead be reimbursed
by the Borrower, at the Borrower’s option.

 

-2-

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

IN WITNESS WHEREOF, the New Subsidiary and the Administrative Agent have duly
executed this Supplement to the Guarantee and Collateral Agreement as of the day
and year first above written.

 

[Name of New Subsidiary] By:  

 

Name:   Title:   Legal Name: Jurisdiction of Formation: Location of Chief
Executive Office:

CITICORP USA, INC., as
Administrative Agent

By:  

 

Name:   Title:   By:  

 

Name:   Title:  

 

-3-

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

Schedule I

to Supplement No.             to the

Guarantee and

Collateral Agreement

LOCATION OF ARTICLE 9 COLLATERAL

 

Description

 

Location

 

-4-

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

Schedule II to

Supplement No.            

to the Guarantee and

Collateral Agreement

Pledged Securities of the New Subsidiary

EQUITY INTERESTS

 

Number of Issuer

Certificate

 

Registered Owner

 

Number and Class of

Equity Interest

 

Percentage of

Equity Interests

DEBT SECURITIES

 

Issuer

 

Principal Amount

 

Date of Note

 

Maturity Date

OTHER PROPERTY

 

-5-

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

Exhibit II

to the Guarantee and

Collateral Agreement

[Form of]

Perfection Certificate

[Provided under separate cover.]

 

-6-

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

Exhibit III

to the Guarantee and

Collateral Agreement

[Form of]

Copyright Security Agreement

Copyright Security Agreement, dated as of [            ], by [            ] and
[            ] (individually, a “Pledgor”, and, collectively, the “Pledgors”),
in favor of CITICORP USA, INC., in its capacity as administrative agent for the
Secured Parties (in such capacity, the “Administrative Agent”).

WITNESSETH:

WHEREAS, the Pledgors are party to a Guarantee and Collateral Agreement of even
date herewith (the “Guarantee and Collateral Agreement”) in favor of the
Administrative Agent pursuant to which the Pledgors are required to execute and
deliver this Copyright Security Agreement;

NOW, THEREFORE, in consideration of the premises and to induce the
Administrative Agent, for the benefit of the Secured Parties, to enter into the
Credit Agreement, the Pledgors hereby agree with the Administrative Agent as
follows:

SECTION 1. Defined Terms. Unless otherwise defined herein, terms defined in the
Guarantee and Collateral Agreement and used herein have the meaning given to
them in the Guarantee and Collateral Agreement.

SECTION 2. Grant of Security Interest in Copyright Collateral. Each Pledgor
hereby pledges and grants to the Administrative Agent for the benefit of the
Secured Parties a lien on and security interest in and to all of its right,
title and interest in, to and under all the following Pledged Collateral of such
Pledgor:

(a) all of the following now owned or hereafter acquired by any Pledgor: (i) all
copyright rights in any work subject to the copyright laws of the United States
or any other country, whether as author, assignee, transferee or otherwise; and
(ii) all registrations and applications for registration of any such copyright
in the United States or any other country, including registrations, supplemental
registrations and pending applications for registration in the United States
Copyright Office and the right to obtain all renewals thereof, including those
listed on Schedule I attached hereto; and

(b) all proceeds of any and all of the foregoing.

SECTION 3. Guarantee and Collateral Agreement. The security interest granted
pursuant to this Copyright Security Agreement is granted in conjunction with the
security interest granted to the Administrative Agent pursuant to the Guarantee
and Collateral Agreement and Pledgors hereby acknowledge and affirm that the
rights and remedies of the Administrative Agent with respect to the security
interest in the Copyrights made and granted hereby are more fully set forth in
the Guarantee and Collateral Agreement, the terms and provisions of which are
incorporated by reference herein as if fully set forth herein. In the event that
any provision of this Copyright Security Agreement is deemed to conflict with
the Guarantee and Collateral Agreement, the provisions of the Guarantee and
Collateral Agreement shall control unless the Administrative Agent shall
otherwise determine.

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

SECTION 4. Termination. Upon the payment in full of the Loan Document
Obligations and termination of the Guarantee and Collateral Agreement, the
Administrative Agent shall execute, acknowledge, and deliver to the Pledgors an
instrument in writing in recordable form releasing the collateral pledge, grant,
assignment, lien and security interest in the Copyrights under this Copyright
Security Agreement.

SECTION 5. Counterparts. This Copyright Security Agreement may be executed in
any number of counterparts, all of which shall constitute one and the same
instrument, and any party hereto may execute this Copyright Security Agreement
by signing and delivering one or more counterparts.

[signature page follows]

 

-2-

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

IN WITNESS WHEREOF, each Pledgor has caused this Copyright Security Agreement to
be executed and delivered by its duly authorized offer as of the date first set
forth above.

 

Very truly yours, [PLEDGORS] By:  

 

Name:   Title:  

Accepted and Agreed:

 

CITICORP USA, INC., as Administrative Agent By:  

 

Name:   Title:   By:  

 

Name:   Title:  

 

-3-

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

SCHEDULE I

to

COPYRIGHT SECURITY AGREEMENT

COPYRIGHT REGISTRATIONS AND COPYRIGHT APPLICATIONS

Copyright Registrations:

 

OWNER

   REGISTRATION
NUMBER    TITLE      

Copyright Applications:

 

OWNER

   TITLE   

 

-4-

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

Exhibit IV

to the Guarantee and

Collateral Agreement

[Form of]

Patent Security Agreement

Patent Security Agreement, dated as of [            ], by [            ] and
[            ] (individually, a “Pledgor”, and, collectively, the “Pledgors”),
in favor of CITICORP USA, INC., in its capacity as administrative agent pursuant
to the Credit Agreement (in such capacity, the “Administrative Agent”).

WITNESSETH:

WHEREAS, the Pledgors are party to a Guarantee and Collateral Agreement of even
date herewith (the “Guarantee and Collateral Agreement”) in favor of the
Administrative Agent pursuant to which the Pledgors are required to execute and
deliver this Patent Security Agreement;

NOW, THEREFORE, in consideration of the premises and to induce the
Administrative Agent, for the benefit of the Secured Parties, to enter into the
Credit Agreement, the Pledgors hereby agree with the Administrative Agent as
follows:

SECTION 1. Defined Terms. Unless otherwise defined herein, terms defined in the
Guarantee and Collateral Agreement and used herein have the meaning given to
them in the Guarantee and Collateral Agreement.

SECTION 2. Grant of Security Interest in Patent Collateral. Each Pledgor hereby
pledges and grants to the Administrative Agent for the benefit of the Secured
Parties a lien on and security interest in and to all of its right, title and
interest in, to and under all the following Pledged Collateral of such Pledgor:

(a) (i) all letters patent of the United States or the equivalent thereof in any
other country or jurisdiction and all reissues and extensions thereof and
(ii) all applications for letters patent of the United States or the equivalent
thereof in any other country or jurisdiction, and all provisionals,
continuations, divisions, continuations-in-part, reexaminations or revisions
thereof, including, those patents and applications listed on Schedule I attached
hereto; and

(b) all proceeds of any and all of the foregoing.

SECTION 3. Guarantee and Collateral Agreement. The security interest granted
pursuant to this Patent Security Agreement is granted in conjunction with the
security interest granted to the Administrative Agent pursuant to the Guarantee
and Collateral Agreement and Pledgors hereby acknowledge and affirm that the
rights and remedies of the Administrative Agent with respect to the security
interest in the Patents made and granted hereby are more fully set forth in the
Guarantee and Collateral Agreement, the terms and provisions of which are
incorporated by reference herein as if fully set forth herein. In the event that
any provision of this Patent Security Agreement is deemed to conflict with the
Guarantee and Collateral Agreement, the provisions of the Guarantee and
Collateral Agreement shall control unless the Administrative Agent shall
otherwise determine.

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

SECTION 4. Termination. Upon the payment in full of the Loan Document
Obligations and termination of the Guarantee and Collateral Agreement, the
Administrative Agent shall execute, acknowledge, and deliver to the Pledgors an
instrument in writing in recordable form releasing the collateral pledge, grant,
assignment, lien and security interest in the Patents under this Patent Security
Agreement.

SECTION 5. Counterparts. This Patent Security Agreement may be executed in any
number of counterparts, all of which shall constitute one and the same
instrument, and any party hereto may execute this Patent Security Agreement by
signing and delivering one or more counterparts.

[signature page follows]

 

-2-

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

IN WITNESS WHEREOF, each Pledgor has caused this Patent Security Agreement to be
executed and delivered by its duly authorized offer as of the date first set
forth above.

 

Very truly yours, [PLEDGORS] By:  

 

Name:   Title:  

Accepted and Agreed:

 

CITICORP USA, INC., as Administrative Agent By:  

 

Name:   Title:   By:  

 

Name:   Title:  

 

-3-

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

SCHEDULE I

to

PATENT SECURITY AGREEMENT

PATENT REGISTRATIONS AND PATENT APPLICATIONS

Patent Registrations:

 

OWNER

   REGISTRATION
NUMBER    NAME      

Patent Applications:

 

OWNER

   APPLICATION
NUMBER    NAME      

 

-4-

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

Exhibit V

to the Guarantee and

Collateral Agreement

[Form of]

Trademark Security Agreement

Trademark Security Agreement, dated as of [            ], by [            ] and
[            ] (individually, a “Pledgor”, and, collectively, the “Pledgors”),
in favor of CITICORP USA, INC., in its capacity as administrative agent pursuant
to the Credit Agreement (in such capacity, the “Administrative Agent”).

WITNESSETH:

WHEREAS, the Pledgors are party to a Guarantee and Collateral Agreement of even
date herewith (the “Guarantee and Collateral Agreement”) in favor of the
Administrative Agent pursuant to which the Pledgors are required to execute and
deliver this Trademark Security Agreement;

NOW, THEREFORE, in consideration of the premises and to induce the
Administrative Agent, for the benefit of the Secured Parties, to enter into the
Credit Agreement, the Pledgors hereby agree with the Administrative Agent as
follows:

SECTION 1. Defined Terms. Unless otherwise defined herein, terms defined in the
Guarantee and Collateral Agreement and used herein have the meaning given to
them in the Guarantee and Collateral Agreement.

SECTION 2. Grant of Security Interest in Trademark Collateral. Each Pledgor
hereby pledges and grants to the Administrative Agent for the benefit of the
Secured Parties a lien on and security interest in and to all of its right,
title and interest in, to and under all the following Pledged Collateral of such
Pledgor:

(a) all trademarks, service marks, corporate names, company names, business
names, fictitious business names, trade dress, logos, other source or business
identifiers, designs and general intangibles of like nature, now existing or
hereafter adopted or acquired and the goodwill attendant thereto, all
registrations thereof (if any), and all applications filed in connection
therewith, including registrations and registration applications in the United
States Patent and Trademark Office or any similar offices in any State of the
United States or any other country or any political subdivision thereof, and all
renewals thereof, including those trademarks of such Pledgor listed on Schedule
I attached hereto; and

(b) all proceeds of any and all of the foregoing.

SECTION 3. Guarantee and Collateral Agreement. The security interest granted
pursuant to this Trademark Security Agreement is granted in conjunction with the
security interest granted to the Administrative Agent pursuant to the Guarantee
and Collateral Agreement and Pledgors hereby acknowledge and affirm that the
rights and remedies of the Administrative Agent with respect to the security
interest in the Trademarks made and granted hereby are more fully set forth in
the Guarantee and Collateral Agreement, the terms and provisions of which are
incorporated by reference herein as if fully set forth herein. In the event that
any provision of this Trademark Security Agreement is deemed to conflict with
the Guarantee and Collateral Agreement, the provisions of the Guarantee and
Collateral Agreement shall control unless the Administrative Agent shall
otherwise determine.

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

SECTION 4. Termination. Upon the payment in full of the Loan Document
Obligations and termination of the Guarantee and Collateral Agreement, the
Administrative Agent shall execute, acknowledge, and deliver to the Pledgors an
instrument in writing in recordable form releasing the collateral pledge, grant,
assignment, lien and security interest in the Trademarks under this Trademark
Security Agreement.

SECTION 5. Counterparts. This Trademark Security Agreement may be executed in
any number of counterparts, all of which shall constitute one and the same
instrument, and any party hereto may execute this Trademark Security Agreement
by signing and delivering one or more counterparts.

[signature page follows]

 

-2-

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

IN WITNESS WHEREOF, each Pledgor has caused this Trademark Security Agreement to
be executed and delivered by its duly authorized offer as of the date first set
forth above.

 

Very truly yours, [PLEDGORS] By:  

 

Name:   Title:  

Accepted and Agreed:

 

CITICORP USA, INC., as Administrative Agent By:  

 

Name:   Title:   By:  

 

Name:   Title:  

 

-3-

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

SCHEDULE I

to

TRADEMARK SECURITY AGREEMENT

TRADEMARK REGISTRATIONS AND TRADEMARK APPLICATIONS

Trademark Registrations:

 

OWNER

   REGISTRATION
NUMBER    TRADEMARK      

Trademark Applications:

 

OWNER

   APPLICATION
NUMBER    TRADEMARK      

 

-4-

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

Exhibit VI

to the Guarantee and

Collateral Agreement

[Form of]

Notice to Bailee of Security Interest in Inventory

CERTIFIED MAIL — RETURN RECEIPT REQUESTED

[                    ], 200[  ]

 

TO:    [Bailee’s Name]    [Bailee’s Address]

 

  Re: Secure Computing Corporation

Ladies and Gentlemen:

In connection with that certain Guarantee and Collateral Agreement, dated as of
August 31, 2006 (the “Guarantee and Collateral Agreement”), made by Secure
Computing Corporation (the “Borrower”), the Guarantors party thereto and
Citicorp USA, Inc., as Administrative Agent (“Citicorp USA”), we have granted to
Citicorp USA a security interest in substantially all of our personal property,
including our inventory.

This letter constitutes notice to you, and your signature below will constitute
your acknowledgment, of Citicorp USA’s continuing first priority security
interest in all goods with respect to which you are acting as bailee. Until you
are notified in writing to the contrary by Citicorp USA, however, you may
continue to accept instructions from us regarding the delivery of goods stored
by you.

Your acknowledgment also constitutes a waiver and release, for Citicorp USA’s
benefit, of any and all claims, liens, including bailee’s liens, and demands of
every kind which you have or may later have against such goods (including any
right to include such goods in any secured financing to which you may become
party).

In order to complete our records, kindly have a duplicate of this letter signed
by an officer of your company and return same to us at your earliest
convenience.

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

Receipt acknowledged, confirmed and approved:   Very truly yours, [BAILEE]  
[APPLICABLE PLEDGOR] By:  

 

  By:  

 

Name:     Name:   Title:     Title:  

 

cc: Citicorp USA, Inc., as Administrative Agent

 

-2-

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

Exhibit VII

to the Guarantee and

Collateral Agreement

[Form of]

Control Agreement Concerning Deposit Accounts

This CONTROL AGREEMENT CONCERNING DEPOSIT ACCOUNTS (this “Control Agreement”),
dated as of [            ], by and among [            ], a [            ]
corporation (the “Pledgor”), CITICORP USA, INC., as administrative agent for the
benefit of the Secured Parties under the Credit Agreement (the “Administrative
Agent”) and [            ] (the “Bank”), is delivered pursuant to
Section 4.04(f) of that certain Guarantee and Collateral Agreement (as amended,
amended and restated, supplemented or otherwise modified from time to time, the
“Guarantee and Collateral Agreement”), dated as of August 31, 2006, made by the
Pledgor and each of the Guarantors listed on the signature pages thereto in
favor of the Administrative Agent. This Control Agreement is for the purpose of
perfecting the security interests of the Secured Parties granted by the Pledgor
in the Designated Accounts described below. All references herein to the “UCC”
shall mean the Uniform Commercial Code as in effect from time to time in the
State of New York. Capitalized terms used but not defined herein shall have the
meanings assigned to such terms in the Guarantee and Collateral Agreement.

Section 1. Confirmation of Establishment and Maintenance of Designated Accounts.
The Bank hereby confirms and agrees that (i) the Bank has established for the
Pledgor and maintains the deposit account(s) listed in Schedule 1 annexed hereto
(such account(s), together with each such other deposit account maintained by
the Pledgor with the Bank collectively, the “Designated Accounts” and each a
“Designated Account”), (ii) each Designated Account will be maintained in the
manner set forth herein until termination of this Control Agreement, (iii) the
Bank is a “bank,” as such term is defined in the UCC, (iv) this Control
Agreement is the valid and legally binding obligation of the Bank and (v) each
Designated Account is a “deposit account” as such term is defined in Article 9
of the UCC.

Section 2. Control. The Bank shall comply with instructions originated by the
Administrative Agent without further consent of the Pledgor or any person acting
or purporting to act for the Pledgor being required, including, without
limitation, directing disposition of the funds in each Designated Account. The
Bank shall also comply with instructions directing the disposition of funds in
each Designated Account originated by the Pledgor or its authorized
representatives until such time as the Administrative Agent delivers a Notice of
Sole Control pursuant to Section 8(i) hereof to the Bank. The Bank shall comply
with, and is fully entitled to rely upon, any instruction from the
Administrative Agent, even if such instruction is contrary to any instruction
that the Pledgor may give or may have given to the Bank.

Section 3. Subordination of Lien; Waiver of Set-Off. The Bank hereby agrees that
any security interest in, lien on, encumbrance, claim or (except as provided in
the next sentence) right of setoff against, any Designated Account or any funds
therein it now has or subsequently obtains shall be subordinate to the security
interest of the Administrative Agent in the Designated Accounts and the funds
therein or credited thereto. The Bank agrees not to exercise any present or
future right of recoupment or set-off against any of the Designated Accounts or
to assert against any of the Designated Accounts any present or future security
interest, banker’s lien or any other lien or claim (including claim for
penalties) that the Bank may at any time have against or in any of the
Designated Accounts or any funds therein; provided, however, that the Bank may
set off (i) all amounts due to the Bank in respect of its customary fees and
expenses for the routine maintenance and operation of the Designated Accounts,
including overdraft fees, and (ii) the face amount of any checks or other items
which have been credited to any Designated Account but are subsequently returned
unpaid because of uncollected or insufficient funds).

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

Section 4. Choice of Law. Both this Control Agreement and the Designated
Accounts shall be governed by the laws of the State of New York. Regardless of
any provision in any other agreement, for purposes of the UCC, New York shall be
deemed to be the Bank’s jurisdiction and the Designated Account(s) shall be
governed by the law of the State of New York.

Section 5. Conflict with Other Agreements; Amendments. As of the date hereof,
there are no other agreements entered into between the Bank and the Pledgor with
respect to any Designated Account or any funds credited thereto (other than
standard and customary documentation with respect to the establishment and
maintenance of such Designated Accounts). The Bank and the Pledgor will not
enter into any other agreement with respect to any Designated Account unless the
Administrative Agent shall have received prior written notice thereof. The Bank
and the Pledgor have not and will not enter into any other agreement with
respect to control of the Designated Accounts or purporting to limit or
condition the obligation of the Bank to comply with any orders or instructions
with respect to any Designated Account as set forth in Section 2 hereof without
the prior written consent of the Administrative Agent acting in its sole
discretion. In the event of any conflict with respect to control over any
Designated Account between this Control Agreement (or any portion hereof) and
any other agreement now existing or hereafter entered into, the terms of this
Control Agreement shall prevail. No amendment or modification of this Control
Agreement or waiver of any right hereunder shall be binding on any party hereto
unless it is in writing and is signed by all the parties hereto.

Section 6. Certain Agreements. As of the date hereof, the Bank has furnished to
the Administrative Agent the most recent account statement issued by the Bank
with respect to each of the Designated Accounts and the cash balances held
therein. Each such statement accurately reflects the assets held in such
Designated Account as of the date thereof.

Section 7. Notice of Adverse Claims. Except for the claims and interest of the
Secured Parties and of the Pledgor in the Designated Accounts, the Bank on the
date hereof does not know of any claim to, security interest in, lien on, or
encumbrance against, any Designated Account or in any funds credited thereto and
does not know of any claim that any person or entity other than the
Administrative Agent has been given control (within the meaning of Section 9-104
of the UCC) of any Designated Account or any such funds. If the Bank becomes
aware that any person or entity is asserting any lien, encumbrance, security
interest or adverse claim (including any writ, garnishment, judgment, warrant of
attachment, execution or similar process or any claim of control) against any
funds in any Designated Account, the Bank shall promptly notify the
Administrative Agent and the Pledgor thereof.

Section 8. Maintenance of Designated Accounts. In addition to the obligations of
the Bank in Section 2 hereof, the Bank agrees to maintain the Designated
Accounts as follows:

(i) Notice of Sole Control. If at any time the Administrative Agent delivers to
the Bank a notice instructing the Bank to terminate Pledgor’s access to any
Designated Account (the “Notice of Sole Control”), the Bank agrees that, after
receipt of such notice, it will take all instruction with respect to such
Designated Account solely from the Administrative Agent, terminate all
instructions and orders originated by the Pledgor with respect to the Designated
Accounts or any funds therein, and cease taking instructions from the Pledgor,
including, without limitation, instructions for distribution or transfer of any
funds in any Designated Account.

(ii) Statements and Confirmations. The Bank will send copies of all statements
and other correspondence (excluding routine confirmations) concerning any
Designated Account

 

-2-

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

simultaneously to the Pledgor and the Administrative Agent at the address set
forth in Section 10 hereof. The Bank will promptly provide to the Administrative
Agent, upon request therefor from time to time and, in any event, as of the last
business day of each calendar month, a statement of the cash balance in each
Designated Account. The Bank shall not change the name or account number of any
Designated Account without the prior written consent of the Administrative
Agent.

Section 9. Successors; Assignment. The terms of this Control Agreement shall be
binding upon, and shall inure to the benefit of, the parties hereto and their
respective corporate successors and permitted assignees.

Section 10. Notices. Any notice, request or other communication required or
permitted to be given under this Control Agreement shall be in writing and
deemed to have been properly given when delivered in person, or when sent by
telecopy or other electronic means and electronic confirmation of error free
receipt is received or two (2) days after being sent by certified or registered
United States mail, return receipt requested, postage prepaid, addressed to the
party at the address set forth below.

 

Pledgor:   [                                                 ]   [Address]  
Attention:   Telecopy:   Telephone:   with copy to:  
[                                                  ]   [Address]   Attention:  
Telecopy:   Telephone: Bank:   [                                       
          ]   [                                                  ]  
[                                                  ]   Attention:   Telecopy:  
Telephone: Administrative   Agent:   Citicorp USA, Inc.   390 Greenwich Street  
New York, NY 100013   Attention:   Telecopy:   Telephone:

Any party may change its address for notices in the manner set forth above.

 

-3-

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

Section 11. Termination.

(i) Except as otherwise provided in this Section 11, the obligations of the Bank
hereunder and this Control Agreement shall continue in effect until the security
interests of the Administrative Agent in the Designated Accounts and any and all
funds therein have been terminated pursuant to the terms of the Guarantee and
Collateral Agreement and the Administrative Agent has notified the Bank of such
termination in writing.

(ii) The Bank, acting alone, may terminate this Control Agreement at any time
and for any reason by written notice delivered to the Administrative Agent and
the Pledgor not less than thirty (30) days prior to the effective termination
date.

(iii) Prior to any termination of this Control Agreement pursuant to this
Section 11, the Bank hereby agrees that it shall promptly take, at Pledgor’s
sole cost and expense, all reasonable actions necessary to facilitate the
transfer of any funds in the Designated Accounts as follows: (a) in the case of
a termination of this Control Agreement under Section 11(i), to the institution
designated in writing by Pledgor; and (b) in all other cases, to the institution
designated in writing by the Administrative Agent.

Section 12. Fees and Expenses. The Bank agrees to look solely to the Pledgor for
payment of any and all fees, costs, charges and expenses incurred or otherwise
relating to the Designated Accounts and services provided by the Bank hereunder
(collectively, the “Account Expenses”), and the Pledgor agrees to pay such
Account Expenses to the Bank on demand therefor. The Pledgor acknowledges and
agrees that it shall be, and at all times remains, solely liable to the Bank for
all Account Expenses.

Section 13. Severability. If any term or provision set forth in this Control
Agreement shall be invalid or unenforceable, the remainder of this Control
Agreement, other than those provisions held invalid or unenforceable, shall be
construed in all respects as if such invalid or unenforceable term or provision
were omitted.

Section 14. Counterparts. This Control Agreement may be executed in any number
of counterparts, all of which shall constitute one and the same instrument, and
any party hereto may execute this Control Agreement by signing and delivering
one or more counterparts.

[signature page follows]

 

-4-

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[                                 ] By:  

 

Name:   Title:  

CITICORP USA, INC.,

as Administrative Agent

By:  

 

Name:   Title:   By:  

 

Name:   Title:  

[                                ],

as Bank

By:  

 

Name:   Title:  

 

-5-

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SCHEDULE I

to

Control Agreement Concerning Deposit Accounts

Designated Account(s)

 

-6-

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Exhibit VIII

to the Guarantee and

Collateral Agreement

[Form of]

Control Agreement Concerning Securities Accounts

This Control Agreement Concerning Securities Accounts (this “Control
Agreement”), dated as of [            ], by and among [            ] (the
“Pledgor”), Citicorp USA, Inc., as administrative agent (the “Administrative
Agent”) and [            ] (the “Securities Intermediary”), is delivered
pursuant to Section 3.4(c) of that certain guarantee and collateral agreement
(as amended, amended and restated, supplemented or otherwise modified from time
to time, the “Guarantee and Collateral Agreement”), dated as of [            ],
2006, made by the Pledgor and each of the Guarantors listed on the signature
pages thereto in favor of Citicorp USA, Inc., as Administrative Agent, as
pledgee, assignee and secured party. This Control Agreement is for the purpose
of perfecting the security interests of the Secured Parties granted by the
Pledgor in the Designated Accounts described below. All references herein to the
“UCC” shall mean the Uniform Commercial Code as in effect from time to time in
the State of New York. Capitalized terms used but not defined herein shall have
the meanings assigned to such terms in the Guarantee and Collateral Agreement.

Section 1. Confirmation of Establishment and Maintenance of Designated Accounts.
The Securities Intermediary hereby confirms and agrees that (i) the Securities
Intermediary has established for the Pledgor and maintains the account(s) listed
in Schedule I annexed hereto (such account(s), together with each such other
securities account maintained by the Pledgor with the Securities Intermediary
collectively, the “Designated Accounts” and each a “Designated Account”),
(ii) each Designated Account will be maintained in the manner set forth herein
until termination of this Control Agreement, (iii) this Control Agreement is the
valid and legally binding obligation of the Securities Intermediary, (iv) the
Securities Intermediary is a “securities intermediary” as defined in Article
8-102(a)(14) of the UCC, (v) each of the Designated Accounts is a “securities
account” as such term is defined in Section 8-501(a) of the UCC and (vi) all
securities or other property underlying any financial assets which are credited
to any Designated Account shall be registered in the name of the Securities
Intermediary, endorsed to the Securities Intermediary or in blank or credited to
another securities account maintained in the name of the Securities Intermediary
and in no case will any financial asset credited to any Designated Account be
registered in the name of the Pledgor, payable to the order of the Pledgor or
specially endorsed to the Pledgor, except to the extent the foregoing have been
specially endorsed to the Securities Intermediary or in blank.

Section 2. “Financial Assets” Election. All parties hereto agree that each item
of Investment Property and all other property held in or credited to any
Designated Account (the “Account Property”) shall be treated as a “financial
asset” within the meaning of Section 8-102(a)(9) of the UCC.

Section 3. Entitlement Order. If at any time the Securities Intermediary shall
receive an “entitlement order” (within the meaning of Section 8-102(a)(8) of the
UCC) issued by the Administrative Agent and relating to any financial asset
maintained in one or more of the Designated Accounts, the Securities
Intermediary shall comply with such entitlement order without further consent by
the Pledgor or any other person. The Securities Intermediary shall also comply
with instructions directing the Securities Intermediary with respect to the
sale, exchange or transfer of any Account Property held in each Designated
Account originated by a Pledgor, or any representative of, or investment manager

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

appointed by, a Pledgor until such time as the Administrative Agent delivers a
Notice of Sole Control pursuant to Section 9(i) to the Securities Intermediary.
The Securities Intermediary shall comply with, and is fully entitled to rely
upon, any entitlement order from the Administrative Agent, even if such
entitlement order is contrary to any entitlement order that the Pledgor may give
or may have given to the Securities Intermediary.

Section 4. Subordination of Lien; Waiver of Set-Off. The Securities Intermediary
hereby agrees that any security interest in, lien on, encumbrance, claim or
(except as provided in the next sentence) right of setoff against, any
Designated Account or any Account Property it now has or subsequently obtains
shall be subordinate to the security interest of the Administrative Agent in the
Designated Accounts and the Account Property therein or credited thereto. The
Securities Intermediary agrees not to exercise any present or future right of
recoupment or set-off against any of the Designated Accounts or to assert
against any of the Designated Accounts any present or future security interest,
banker’s lien or any other lien or claim (including claim for penalties) that
the Securities Intermediary may at any time have against or in any of the
Designated Accounts or any Account Property therein or credited thereto;
provided, however, that the Securities Intermediary may set off all amounts due
to the Securities Intermediary in respect of its customary fees and expenses for
the routine maintenance and operation of the Designated Accounts, including
overdraft fees and amounts advanced to settle authorized transactions.

Section 5. Choice of Law. Both this Control Agreement and the Designated
Accounts shall be governed by the laws of the State of New York. Regardless of
any provision in any other agreement, for purposes of the UCC, New York shall be
deemed to be the Securities Intermediary’s jurisdiction and the Designated
Accounts (as well as the security entitlements related thereto) shall be
governed by the laws of the State of New York.

Section 6. Conflict with Other Agreements; Amendments. As of the date hereof,
there are no other agreements entered into between the Securities Intermediary
and the Pledgor with respect to any Designated Account or any security
entitlements or other financial assets credited thereto (other than standard and
customary documentation with respect to the establishment and maintenance of
such Designated Accounts). The Securities Intermediary and the Pledgor will not
enter into any other agreement with respect to any Designated Account unless the
Administrative Agent shall have received prior written notice thereof. The
Securities Intermediary and the Pledgor have not and will not enter into any
other agreement with respect to (i) creation or perfection of any security
interest in or (ii) control of security entitlements maintained in any of the
Designated Accounts or purporting to limit or condition the obligation of the
Securities Intermediary to comply with entitlement orders with respect to any
Account Property held in or credited to any Designated Account as set forth in
Section 3 hereof without the prior written consent of the Administrative Agent
acting in its sole discretion. In the event of any conflict with respect to
control over any Designated Account between this Control Agreement (or any
portion hereof) and any other agreement now existing or hereafter entered into,
the terms of this Control Agreement shall prevail. No amendment or modification
of this Control Agreement or waiver of any rights hereunder shall be binding on
any party hereto unless it is in writing and is signed by all the parties
hereto.

Section 7. Certain Agreements.

(i) As of the date hereof, the Securities Intermediary has furnished to the
Administrative Agent the most recent account statement issued by the Securities
Intermediary with respect to each of the Designated Accounts and the financial
assets and cash balances held therein, identifying the financial assets held
therein in a manner acceptable to the Administrative Agent. Each such statement
accurately reflects the assets held in such Designated Account as of the date
thereof.

 

-2-

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(ii) The Securities Intermediary will, upon its receipt of each supplement to
the Guarantee and Collateral Agreement signed by the Pledgor and identifying one
or more financial assets as “Pledged Collateral,” enter into its records,
including computer records, with respect to each Designated Account a notation
with respect to any such financial asset so that such records and reports
generated with respect thereto identify such financial asset as “Pledged.”

Section 8. Notice of Adverse Claims. Except for the claims and interest of the
Administrative Agent and of the Pledgor in the Account Property held in or
credited to the Designated Accounts, the Securities Intermediary on the date
hereof does not know of any claim to, security interest in, lien on, or
encumbrance against, any Designated Account or Account Property held in or
credited thereto and does not know of any claim that any person or entity other
than the Administrative Agent has been given “control” (within the meaning of
Section 8-106 of the UCC) of any Designated Account or any such Account
Property. If the Securities Intermediary becomes aware that any person or entity
is asserting any lien, encumbrance, security interest or adverse claim
(including any writ, garnishment, judgment, warrant of attachment, execution or
similar process or any claim of control) against any of the Account Property
held in or credited to any Designated Account, the Securities Intermediary shall
promptly notify the Administrative Agent and the Pledgor thereof.

Section 9. Maintenance of Designated Accounts. In addition to the obligations of
the Securities Intermediary in Section 3 hereof, the Securities Intermediary
agrees to maintain the Designated Accounts as follows:

(i) Notice of Sole Control. If at any time the Administrative Agent delivers to
the Securities Intermediary a notice instructing the Securities Intermediary to
terminate Pledgor’s access to any Designated Account (the “Notice of Sole
Control”), the Securities Intermediary agrees that, after receipt of such
notice, it will take all instructions with respect to such Designated Account
solely from the Administrative Agent, terminate all instructions and orders
originated by the Pledgor with respect to the Designated Accounts or any Account
Property therein, and cease taking instructions from Pledgor, including, without
limitation, instructions for investment, distribution or transfer of any
financial asset maintained in any Designated Account. Permitting settlement of
trades pending at the time of receipt of such notice shall not constitute a
violation of the immediately preceding sentence.

(ii) Voting Rights. Until such time as the Securities Intermediary receives a
Notice of Sole Control, the Pledgor, or an investment manager on behalf of the
Pledgor, shall direct the Securities Intermediary with respect to the voting of
any financial assets credited to any Designated Account.

(iii) Statements and Confirmations. The Securities Intermediary will send copies
of all statements and other correspondence (excluding routine confirmations)
concerning any Designated Account or any financial assets credited thereto
simultaneously to each of the Pledgor and the Administrative Agent at the
address set forth in Section 11 hereof. The Securities Intermediary will provide
to the Administrative Agent, upon the Administrative Agent’s request therefor
from time to time and, in any event, as of the last business day of each
calendar month, a statement of the market value of each financial asset
maintained in each Designated Account. The Securities Intermediary shall not
change the name or account number of any Designated Account without the prior
written consent of the Administrative Agent.

(iv) Perfection in Certificated Securities. The Securities Intermediary
acknowledges that, in the event that it should come into possession of any
certificate representing any security or other Account Property held in or
credited to any of the Designated Accounts, the Securities

 

-3-

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

Intermediary shall retain possession of the same on behalf and for the benefit
of the Administrative Agent and such act shall cause the Securities Intermediary
to be deemed holding such certificate for the Administrative Agent, if necessary
to perfect the Administrative Agent’s security interest in such securities or
assets. The Securities Intermediary hereby acknowledges its receipt of a copy of
the Guarantee and Collateral Agreement, which shall also serve as notice to the
Securities Intermediary of a security interest in collateral held on behalf and
for the benefit of the Administrative Agent.

Section 10. Successors; Assignment. The terms of this Control Agreement shall be
binding upon, and shall inure to the benefit of, the parties hereto and their
respective corporate successors and permitted assignees.

Section 11. Notices. Any notice, request or other communication required or
permitted to be given under this Control Agreement shall be in writing and
deemed to have been properly given when delivered in person, or when sent by
telecopy or other electronic means and electronic confirmation of error free
receipt is received or two (2) days after being sent by certified or registered
United States mail, return receipt requested, postage prepaid, addressed to the
party at the address set forth below.

 

Pledgor:   [                                 ]   [Address]   Attention:  
Telecopy:   Telephone:   with copy to:   [                                 ]  
[Address]   Attention:   Telecopy:   Telephone: Securities   Intermediary:  
[                                 ]   [Address]   Attention:   Telecopy:  
Telephone: Administrative   Agent:   Citicorp USA, Inc.   390 Greenwich Street  
New York, NY 100013   Attention:   Telecopy:   Telephone:

Any party may change its address for notices in the manner set forth above.

 

-4-

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Section 12. Termination.

(i) Except as otherwise provided in this Section 12, the obligations of the
Securities Intermediary hereunder and this Control Agreement shall continue in
effect until the security interests of the Administrative Agent in the
Designated Accounts and any and all Account Property held therein or credited
thereto have been terminated pursuant to the terms of the Guarantee and
Collateral Agreement and the Administrative Agent has notified the Securities
Intermediary of such termination in writing.

(ii) The Securities Intermediary, acting alone, may terminate this Control
Agreement at any time and for any reason by written notice delivered to the
Administrative Agent and the Pledgor not less than thirty (30) days prior to the
effective termination date.

(iii) Prior to any termination of this Control Agreement pursuant to this
Section 12, the Securities Intermediary hereby agrees that it shall promptly
take, at Pledgor’s sole cost and expense, all reasonable actions necessary to
facilitate the transfer of any Account Property in or credited to the Designated
Accounts as follows: (i) in the case of a termination of this Control Agreement
under Section 12(i), to the institution designated in writing by Pledgor; and
(ii) in all other cases, to the institution designated in writing by the
Administrative Agent.

Section 13. Fees and Expenses. The Securities Intermediary agrees to look solely
to the Pledgor for payment of any and all fees, costs, charges and expenses
incurred or otherwise relating to the Designated Accounts and services provided
by the Securities Intermediary hereunder (collectively, the “Account Expenses”),
and the Pledgor agrees to pay such Account Expenses to the Securities
Intermediary on demand therefor. The Pledgor acknowledges and agrees that it
shall be, and at all times remains, solely liable to the Securities Intermediary
for all Account Expenses.

Section 14. Severability. If any term or provision set forth in this Control
Agreement shall be invalid or unenforceable, the remainder of this Control
Agreement, other than those provisions held invalid or unenforceable, shall be
construed in all respects as if such invalid or unenforceable term or provision
were omitted.

Section 15. Counterparts. This Control Agreement may be executed in any number
of counterparts, all of which shall constitute one and the same instrument, and
any party hereto may execute this Control Agreement by signing and delivering
one or more counterparts.

[signature page follows]

 

-5-

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

[                                                     ],     as Pledgor By:  

 

Name:   Title:  

CITICORP USA, INC.,
as Administrative Agent

By:  

 

Name:   Title:   By:  

 

Name:   Title:   [                                                     ],     as
Securities Intermediary By:  

 

Name:   Title:  

 

-6-

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

SCHEDULE I

TO

CONTROL AGREEMENT CONCERNING SECURITIES ACCOUNTS

Designated Account(s)

 

-7-

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

Exhibit IX

to the Guarantee and

Collateral Agreement

[Form of]

Landlord’s Access Agreement

THIS LANDLORD’S ACCESS AGREEMENT (the “Agreement”) is made and entered into as
of                     , 2006 by and between                     , having an
office at                                      (“Landlord”) and
                                        , having an office at
                                        as administrative agent (in such
capacity, “Administrative Agent”) for the benefit of the Secured Parties (as
hereinafter defined) under the Credit Agreement (as hereinafter defined).

RECITALS :

A. Landlord is the record title holder and owner of the real property described
in Schedule A attached hereto (the “Real Property”).

B. Landlord has leased all or a portion of the Real Property (the “Leased
Premises”) to [            ] (“Lessee” [or “Borrower”]) pursuant to a certain
lease agreement or agreements described in Schedule B attached hereto
(collectively, and as amended, amended and restated, supplemented or otherwise
modified from time to time, the “Lease”).

C. [Lessee,] [(“Borrower”),], a [            ] [            ] (“Parent”) and the
Administrative Agent, among others, are, in connection with the execution and
delivery of this Agreement, entering into a credit agreement, dated as of
August 31, 2006, (as amended, amended and restated, supplemented or otherwise
modified from time to time, the “Credit Agreement”; capitalized terms used and
not otherwise defined herein shall have the meanings assigned to such terms in
the Credit Agreement), pursuant to which the Lenders have agreed to make certain
loans to Borrower (collectively, the “Loans”).

[D. [The Lessee is a subsidiary of Borrower.]1

E. The Lessee has, pursuant to the Credit Agreement, guaranteed the obligations
of the Borrower under the Credit Agreement and the other documents evidencing
and securing the Loans (collectively, the “Loan Documents”).]2

F. As security for the payment and performance of Lessee’s Obligations under the
Credit Agreement and the other documents evidencing and securing the Loans
(collectively, the “Loan Documents”), Administrative Agent (for its benefit and
the benefit of the Secured Parties) has or will acquire a security interest in
and lien upon all of Lessee’s personal property, inventory, accounts, goods,
machinery, equipment, furniture and fixtures (together with all additions,
substitutions, replacements and improvements to, and proceeds of, the foregoing,
collectively, the “Personal Property”).

 

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

1 Include one of these alternatives if Borrower is not the Lessee.

2 Include if Borrower is not the Lessee

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

G. Administrative Agent has requested that Landlord execute this Agreement as a
condition precedent to the making of the Loans under the Credit Agreement.

AGREEMENT :

NOW, THEREFORE, for and in consideration of the premises and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, Landlord hereby represents, warrants and agrees in favor of
Administrative Agent, as follows:

1. Landlord certifies that (i) Landlord is the landlord under the Lease
described in Schedule B attached hereto, (ii) the Lease is in full force and
effect and has not been amended, modified or supplemented except as set forth in
Schedule B hereto and (iii) Landlord has sent no notice of default to Lessee
under the Lease respecting a default which has not been cured by Lessee.

2. Landlord agrees that the Personal Property is and will remain personal
property and not fixtures even though it may be affixed to or placed on the
Leased Premises. Landlord further agrees that Administrative Agent has the right
to remove the Personal Property from the Leased Premises at any time in
accordance with the terms of the Loan Documents; provided that Administrative
Agent shall repair any damage arising from such removal. Landlord further agrees
that it will not hinder Administrative Agent’s actions in removing Personal
Property from the Leased Premises or Administrative Agent’s actions in otherwise
enforcing its security interest in the Personal Property. Administrative Agent
shall not be liable for any diminution in value of the Leased Premises caused by
the absence of Personal Property actually removed or by the need to replace the
Personal Property after such removal. Landlord acknowledges that Administrative
Agent shall have no obligation to remove the Personal Property from the Leased
Premises.

3. Landlord acknowledges and agrees that Lessee’s granting of a security
interest in the Personal Property in favor of the Administrative Agent (for the
benefit of the Secured Parties) shall not constitute a default under the Lease
nor permit Landlord to terminate the Lease or re-enter or repossess the Leased
Premises or otherwise be the basis for the exercise of any remedy by Landlord
and Landlord hereby expressly consents to the granting of such security interest
and agrees that such security interest shall be superior to any lien of the
Landlord (statutory or otherwise) in the Personal Property.

4. The terms and provisions of this Agreement shall inure to the benefit of and
be binding upon the successors and assigns of Landlord (including, without
limitation, any successor owner of the Real Property) and Administrative Agent.
Landlord will disclose the terms and conditions of this Agreement to any
purchaser or successor to Landlord’s interest in the Leased Premises.

5. All notices to any party hereto under this Agreement shall be in writing and
sent to such party at its respective address set forth above (or at such other
address as shall be designated by such party in a written notice to the other
party complying as to delivery with the terms of this Section 5) by certified
mail, postage prepaid, return receipt requested or by overnight delivery
service.

6. The provisions of this Agreement shall continue in effect until Landlord
shall have received Administrative Agent’s written certification that the Loans
have been paid in full and all of Borrower’s other Obligations under the Credit
Agreement and the other Loan Documents have been satisfied.

 

-2-

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7. THE INTERPRETATION, VALIDITY AND ENFORCEMENT OF THIS AGREEMENT SHALL BE
GOVERNED BY AND CONSTRUED UNDER THE LAWS OF THE STATE OF NEW YORK, WITHOUT
GIVING EFFECT TO THE CONFLICTS OF LAWS PRINCIPLES THEREOF.

8. Landlord agrees to execute, acknowledge and deliver such further instruments
as Administrative Agent may request to allow for the proper recording of this
Agreement (including, without limitation, a revised landlord’s access agreement
in form and substance sufficient for recording) or to otherwise accomplish the
purposes of this Agreement.

 

-3-

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IN WITNESS WHEREOF, Landlord and Administrative Agent have caused this Agreement
to be duly executed and delivered by their duly authorized officers as of the
date first above written.

            ,

 

 

as Landlord By:  

 

Name:   Title:  

CITICORP USA, INC.,
as Administrative Agent

By:  

 

Name:   Title:   By:  

 

Name:   Title:  

 

-4-

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

Schedule A

to

Landlord’s Access Agreement

Description of Real Property

 

-5-

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

Schedule B

to

Landlord’s Access Agreement

Description of Lease

 

Lessor

 

Lessee

 

Dated

 

Modification

 

Location/

Property

Address

 

-6-

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EXHIBIT E

[FORM OF]

SOLVENCY CERTIFICATE

This Solvency Certificate (this “Certificate”) is delivered in connection with
that certain Credit Agreement dated as of August [31], 2006 (as amended,
supplemented or otherwise modified from time to time, the “Credit Agreement”),
among SECURE COMPUTING CORPORATION, a Delaware corporation (the “Borrower”), the
Subsidiary Loan Party party thereto, the Lenders party thereto from time to
time, CITICORP USA, INC., as administrative agent (in such capacity, the
“Administrative Agent”) for the Lenders and as Swingline Lender, CITIBANK, N.A.,
as Issuing Bank, UBS SECURITIES LLC, as syndication agent (in such capacity, the
“Syndication Agent”) and CITIGROUP GLOBAL MARKETS INC. and UBS SECURITIES LLC,
as joint lead arrangers (collectively and in such capacities, the “Joint Lead
Arrangers”) and as joint bookrunners. Capitalized terms used herein without
definition have the same meanings as in the Credit Agreement.

I am the duly qualified and acting Chief Financial Officer of the Borrower and,
in such capacity (and not in any individual capacity) hereby certify that:

Immediately after giving effect to the Transactions on the Closing Date, (i) the
fair value of the assets of the Borrower and its Subsidiaries on a consolidated
basis, at a fair valuation, will exceed the debts and liabilities, direct,
subordinated, contingent or otherwise, of the Borrower and its Subsidiaries on a
consolidated basis, respectively; (ii) the present fair saleable value of the
property of the Borrower and its Subsidiaries on a consolidated basis will be
greater than the amount that will be required to pay the probable liability of
the Borrower and its Subsidiaries on a consolidated basis, respectively, on
their debts and other liabilities, direct, subordinated, contingent or
otherwise, as such debts and other liabilities become absolute and matured;
(iii) the Borrower and its Subsidiaries on a consolidated basis will be able to
pay their debts and liabilities, direct, subordinated, contingent or otherwise,
as such debts and liabilities become absolute and matured; and (iv) the Borrower
and its Subsidiaries on a consolidated basis will not have unreasonably small
capital with which to conduct the businesses in which they are engaged as such
businesses are now conducted and are proposed to be conducted following the
Closing Date.

I represent the foregoing information is provided to the best of my knowledge
and believe and execute this Certificate this [            ]st day of
[            ], 2006.

[Signature Page Follows]

 

E-1

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

SECURE COMPUTING CORPORATION By:  

 

Name:   Title:  

 

E-2

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

EXHIBIT F-1

[Form of]

TERM NOTE

 

$                     

  New York, New York   [Date]

FOR VALUE RECEIVED, the undersigned, Secure Computing Corporation, a Delaware
corporation (“Borrower”), hereby promises to pay to the order of
[                        ] (the “Lender”) on the Term Facility Maturity Date (as
defined in the Credit Agreement referred to below) in lawful money of the United
States and in immediately available funds, the principal amount of
                     DOLLARS ($                    ), or, if less, the aggregate
unpaid principal amount of all Term Loans of the Lender outstanding under the
Credit Agreement referred to below, which sum shall be due and payable in such
amounts and on such dates as are set forth in the Credit Agreement. Borrower
further agrees to pay interest in like money at such office specified in
Section 2.18 of the Credit Agreement on the unpaid principal amount hereof from
time to time from the date hereof at the rates, and on the dates, specified in
Section 2.10 of such Credit Agreement.

The holder of this Note may endorse and attach a schedule to reflect the date,
Type and amount of each Term Loan of the Lender outstanding under the Credit
Agreement, the date and amount of each payment or prepayment of principal
hereof, and the date of each interest rate conversion or continuation pursuant
to Section 2.07 of the Credit Agreement and the principal amount subject
thereto; provided that the failure of the Lender to make any such recordation
(or any error in such recordation) shall not affect the obligations of Borrower
hereunder or under the Credit Agreement.

This Note is one of the Notes referred to in the Credit Agreement dated as of
August [31], 2006 (as amended, supplemented or otherwise modified from time to
time, the “Credit Agreement”), among SECURE COMPUTING CORPORATION, a Delaware
corporation (the “Borrower”), the Subsidiary Loan Party party thereto, the
Lenders party thereto from time to time, CITICORP USA, INC., as administrative
agent (in such capacity, the “Administrative Agent”) for the Lenders and as
Swingline Lender, CITIBANK, N.A., as Issuing Bank, UBS SECURITIES LLC, as
syndication agent (in such capacity, the “Syndication Agent”) and CITIGROUP
GLOBAL MARKETS INC. and UBS SECURITIES LLC, as joint lead arrangers
(collectively and in such capacities, the “Joint Lead Arrangers”) and as joint
bookrunners, is subject to the provisions thereof and is subject to optional and
mandatory prepayment in whole or in part as provided therein. Terms used herein
which are defined in the Credit Agreement shall have such defined meanings
unless otherwise defined herein or unless the context otherwise requires.

This Note is secured and guaranteed as provided in the Credit Agreement and the
Security Documents. Reference is hereby made to the Credit Agreement and the
Security

 

F-1-1

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

Documents for a description of the properties and assets in which a security
interest has been granted, the nature and extent of the security and guarantees,
the terms and conditions upon which the security interest and each guarantee was
granted and the rights of the holder of this Note in respect thereof.

Upon the occurrence of any one or more of the Events of Default specified in the
Credit Agreement, all amounts then remaining unpaid on this Note shall become,
or may be declared to be, immediately due and payable all as provided therein.

All parties now and hereafter liable with respect to this Note, whether maker,
principal, surety, guarantor, endorser or otherwise, hereby waive presentment,
demand, protest and all other notices of any kind.

THIS NOTE MAY NOT BE TRANSFERRED EXCEPT IN COMPLIANCE WITH THE TERMS OF THE
CREDIT AGREEMENT. TRANSFERS OF THIS NOTE MUST BE RECORDED IN THE REGISTER
MAINTAINED BY THE ADMINISTRATIVE AGENT PURSUANT TO THE TERMS OF THE CREDIT
AGREEMENT.

THIS NOTE SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE
STATE OF NEW YORK WITHOUT REGARD TO CONFLICTS OF LAW PRINCIPLES THAT WOULD
REQUIRE THE APPLICATION OF THE LAWS OF ANOTHER JURISDICTION.

[Signature Page Follows]

F-1-2

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SECURE COMPUTING CORPORATION,

as Borrower

By:  

 

Name:   Title:  

 

F-1-3

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EXHIBIT F-2

[Form of]

REVOLVING NOTE

 

$                     

  New York, New York   [Date]

FOR VALUE RECEIVED, the undersigned, Secure Computing Corporation, a Delaware
corporation (“Borrower”), hereby promises to pay to the order of [            ]
(the “Lender”) on the Revolving Facility Maturity Date (as defined in the Credit
Agreement referred to below), in lawful money of the United States and in
immediately available funds, the principal amount of the lesser of
(a)             DOLLARS ($            ) and (b) the aggregate unpaid principal
amount of all Revolving Loans of the Lender outstanding under the Credit
Agreement referred to below. Borrower further agrees to pay interest in like
money at such office specified in Section 2.18 of the Credit Agreement on the
unpaid principal amount hereof from time to time from the date hereof at the
rates, and on the dates, specified in Section 2.10 of such Credit Agreement.

The holder of this Note may endorse and attach a schedule to reflect the date,
Type and amount of each Revolving Facility Loan of the Lender outstanding under
the Credit Agreement, the date and amount of each payment or prepayment of
principal hereof, and the date of each interest rate conversion or continuation
pursuant to Section 2.07 of the Credit Agreement and the principal amount
subject thereto; provided that the failure of the Lender to make any such
recordation (or any error in such recordation) shall not affect the obligations
of Borrower hereunder or under the Credit Agreement.

This Note is one of the Notes referred to in the Credit Agreement dated as of
August [31], 2006 (as amended, supplemented or otherwise modified from time to
time, the “Credit Agreement”), among SECURE COMPUTING CORPORATION, a Delaware
corporation (the “Borrower”), the Subsidiary Loan Party party thereto, the
Lenders party thereto from time to time, CITICORP USA, INC., as administrative
agent (in such capacity, the “Administrative Agent”) for the Lenders and as
Swingline Lender, CITIBANK, N.A., as Issuing Bank, UBS SECURITIES LLC, as
syndication agent (in such capacity, the “Syndication Agent”) and CITIGROUP
GLOBAL MARKETS INC. and UBS SECURITIES LLC, as joint lead arrangers
(collectively and in such capacities, the “Joint Lead Arrangers”) and as joint
bookrunners, is subject to the provisions thereof and is subject to optional and
mandatory prepayment in whole or in part as provided therein. Terms used herein
which are defined in the Credit Agreement shall have such defined meanings
unless otherwise defined herein or unless the context otherwise requires.

This Note is secured and guaranteed as provided in the Credit Agreement and the
Security Documents. Reference is hereby made to the Credit Agreement and the
Security Documents for a description of the properties and assets in which a
security

 

F-2-1

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interest has been granted, the nature and extent of the security and guarantees,
the terms and conditions upon which the security interest and each guarantee was
granted and the rights of the holder of this Note in respect thereof.

Upon the occurrence of any one or more of the Events of Default specified in the
Credit Agreement, all amounts then remaining unpaid on this Note shall become,
or may be declared to be, immediately due and payable, all as provided therein.

All parties now and hereafter liable with respect to this Note, whether maker,
principal, surety, guarantor, endorser or otherwise, hereby waive presentment,
demand, protest and all other notices of any kind.

THIS NOTE MAY NOT BE TRANSFERRED EXCEPT IN COMPLIANCE WITH THE TERMS OF THE
CREDIT AGREEMENT. TRANSFERS OF THIS NOTE MUST BE RECORDED IN THE REGISTER
MAINTAINED BY THE ADMINISTRATIVE AGENT PURSUANT TO THE TERMS OF THE CREDIT
AGREEMENT.

THIS NOTE SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE
STATE OF NEW YORK WITHOUT REGARD TO CONFLICTS OF LAW PRINCIPLES THAT WOULD
REQUIRE THE APPLICATION OF THE LAWS OF ANOTHER JURISDICTION.

[Signature Page Follows]

 

F-2-2

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SECURE COMPUTING CORPORATION,

as Borrower

By:  

 

Name:   Title:  

 

F-2-3

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EXHIBIT G

[Form of]

INTERCOMPANY NOTE

New York, New York

[date]

FOR VALUE RECEIVED, each of the undersigned, to the extent a borrower from time
to time from any other entity listed on the signature page hereto (each, in such
capacity, a “Payor”), hereby promises to pay on demand to the order of such
other entity listed below (each, in such capacity, a “Payee”), in lawful money
of the United States of America in immediately available funds, at such location
in the United States of America as a Payee shall from time to time designate,
the unpaid principal amount of all loans and advances (including trade payables)
made by such Payee to such Payor. Each Payor promises also to pay interest on
the unpaid principal amount of all such loans and advances in like money at said
location from the date of such loans and advances until paid at such rate per
annum as shall be agreed upon from time to time by such Payor and such Payee.

This note (“Note”) is an Intercompany Note referred to in the Credit Agreement
dated as of August [31], 2006 (as amended, supplemented or otherwise modified
from time to time, the “Credit Agreement”), among SECURE COMPUTING CORPORATION,
a Delaware corporation (the “Borrower”), the Subsidiary Loan Party party
thereto, the Lenders party thereto from time to time, CITICORP USA, INC., as
administrative agent (in such capacity, the “Administrative Agent”) for the
Lenders and as Swingline Lender, CITIBANK, N.A., as Issuing Bank, UBS SECURITIES
LLC, as syndication agent (in such capacity, the “Syndication Agent”) and
CITIGROUP GLOBAL MARKETS INC. and UBS SECURITIES LLC, as joint lead arrangers
(collectively and in such capacities, the “Joint Lead Arrangers”) and as joint
bookrunners. Each Payee hereby acknowledges and agrees that the Administrative
Agent may exercise all rights provided in the Credit Agreement and the Security
Agreement with respect to this Note.

Anything in this Note to the contrary notwithstanding, the indebtedness
evidenced by this Note owed by any Payor that is Borrower or a Guarantor to any
Payee other than Borrower shall be subordinate and junior in right of payment,
to the extent and in the manner hereinafter set forth, to all Obligations of
such Payor under the Credit Agreement, including, without limitation, where
applicable, under such Payor’s guarantee of the Obligations under the Credit
Agreement (such Obligations and other indebtedness and obligations in connection
with any renewal, refunding, restructuring or refinancing thereof, including
interest thereon accruing after the commencement of any proceedings referred to
in clause (i) below, whether or not such interest is an allowed claim in such
proceeding, being hereinafter collectively referred to as “Senior
Indebtedness”):

 

G-1

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(i) In the event of any insolvency or bankruptcy proceedings, and any
receivership, liquidation, reorganization or other similar proceedings in
connection therewith, relative to any Payor or to its creditors, as such, or to
its property, and in the event of any proceedings for voluntary liquidation,
dissolution or other winding up of such Payor, whether or not involving
insolvency or bankruptcy, then (x) the holders of Senior Indebtedness shall be
paid in full in cash in respect of all amounts constituting Senior Indebtedness
before any Payee is entitled to receive (whether directly or indirectly), or
make any demands for, any payment on account of this Note and (y) until the
holders of Senior Indebtedness are paid in full in cash in respect of all
amounts constituting Senior Indebtedness, any payment or distribution to which
such Payee would otherwise be entitled (other than debt securities of such Payor
that are subordinated, to at least the same extent as this Note, to the payment
of all Senior Indebtedness then outstanding (such securities being hereinafter
referred to as “Restructured Debt Securities”)) shall be made to the holders of
Senior Indebtedness;

(ii) if any default occurs and is continuing with respect to any Senior
Indebtedness (including any Default under the Credit Agreement), then no payment
or distribution of any kind or character shall be made by or on behalf of the
Payor or any other Person on its behalf with respect to this Note; and

(iii) if any payment or distribution of any character, whether in cash,
securities or other property (other than Restructured Debt Securities), in
respect of this Note shall (despite these subordination provisions) be received
by any Payee in violation of clause (i) or (ii) before all Senior Indebtedness
shall have been paid in full in cash, such payment or distribution shall be held
in trust for the benefit of, and shall be paid over or delivered to, the holders
of Senior Indebtedness (or their representatives), ratably according to the
respective aggregate amounts remaining unpaid thereon, to the extent necessary
to pay all Senior Indebtedness in full in cash.

To the fullest extent permitted by law, no present or future holder of Senior
Indebtedness shall be prejudiced in its right to enforce the subordination of
this Note by any act or failure to act on the part of any Payor or by any act or
failure to act on the part of such holder or any trustee or agent for such
holder. Each Payee and each Payor hereby agree that the subordination of this
Note is for the benefit of the Administrative Agent, the Issuing Bank and the
Lenders and the Administrative Agent, the Issuing Bank and the Lenders are
obligees under this Note to the same extent as if their names were written
herein as such and the Administrative Agent may, on behalf of itself, the
Issuing Bank and the Lenders, proceed to enforce the subordination provisions
herein.

The indebtedness evidenced by this Note owed by any Payor that is not Borrower
or a Guarantor shall not be subordinated to, and shall rank pari passu in right
of payment with, any other obligation of such Payor.

Nothing contained in the subordination provisions set forth above is intended to
or will impair, as between each Payor and each Payee, the obligations of such
Payor, which are absolute and unconditional, to pay to such Payee the principal
of and interest on this Note as and when due and payable in accordance with its
terms, or is intended to or will affect the relative rights of such Payee and
other creditors of such Payor other than the holders of Senior Indebtedness.

 

G-2

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Each Payee is hereby authorized to record all loans and advances made by it to
any Payor (all of which shall be evidenced by this Note), and all repayments or
prepayments thereof, in its books and records, such books and records
constituting prima facie evidence of the accuracy of the information contained
therein.

Each Payor hereby waives presentment, demand, protest or notice of any kind in
connection with this Note. All payments under this Note shall be made without
offset, counterclaim or deduction of any kind.

THIS NOTE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF
THE STATE OF NEW YORK, WITHOUT REGARD TO THE PRINCIPLES OF CONFLICTS OF LAWS
THEREOF.

[Signature Pages Follow]

 

G-3

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SECURE COMPUTING CORPORATION By:  

 

Name:   Title:   CIPHERTRUST, INC. By:  

 

Name:   Title:   PEACH ACQUISITION CORP. By:  

 

Name:   Title:   WEBWASHER AG By:  

 

Name:   Title:   SECURE COMPUTING GmbH By:  

 

Name:   Title:   SECURE COMPUTING AUSTRALIA PTY. LTD. By:  

 

Name:   Title:  

 

G-4

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SECURE COMPUTING SARL By:  

 

Name:   Title:   SECURE COMPUTING JAPAN KK By:  

 

Name:   Title:   CYBERGUARD JAPAN KK By:  

 

Name:   Title:   CYBERGUARD PTY. LTD. By:  

 

Name:   Title:   SECURE COMPUTING CONSULTING (SHANGHAI) CO. LTD By:  

 

Name:   Title:   CYBERGUARD EUROPE LTD. By:  

 

Name:   Title:  

 

G-5

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SECURE COMPUTING CORPORATION

—HONG KONG BRANCH

By:  

 

Name:   Title:   CIPHERTRUST EUROPE LIMITED By:  

 

Name:   Title:   CIPHERTRUST FRANCE EURL By:  

 

Name:   Title:   CIPHERTRUST CANADA LIMITED By:  

 

Name:   Title:   CIPHERTRUST HONG KONG LIMITED By:  

 

Name:   Title   CIPHERTRUST NETHERLANDS B.V. By:  

 

Name:   Title:  

 

G-6

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CIPHERTRUST SINGAPORE PTE LIMITED By:  

 

Name:   Title:   CIPHERTRUST, K.K By:  

 

Name:   Title:   CIPHERTRUST AUSTRALIA PTY LIMITED By:  

 

Name:   Title:   CIPHER SOLUTIONS INDIA PRIVATE LIMITED By:  

 

Name:   Title:   CIPHERTRUST GERMANY GmbH By:  

 

Name:   Title:  

 

G-7