Exhibit 10.4

EXECUTION COPY

 

 

 

 

LOGO [g608281logo.jpg]

AMENDED AND RESTATED

CREDIT AGREEMENT

dated as of

October 28, 2011

among

LIFETIME BRANDS, INC., as the Company

The Foreign Subsidiary Borrowers Party Hereto

The Other Loan Parties Hereto

The Lenders Party Hereto

JPMORGAN CHASE BANK, N.A.,

as Administrative Agent and a Co-Collateral Agent

and

HSBC BANK USA, NATIONAL ASSOCIATION,

as Syndication Agent and a Co-Collateral Agent

 

 

J.P. MORGAN SECURITIES LLC,

as Sole Bookrunner and Sole Lead Arranger

 

 

 

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TABLE OF CONTENTS

 

ARTICLE I Definitions

     1   

SECTION 1.01. Defined Terms

     1   

SECTION 1.02. Classification of Loans and Borrowings

     38   

SECTION 1.03. Terms Generally

     38   

SECTION 1.04. Accounting Terms; GAAP

     38   

SECTION 1.05. Status of Obligations

     39   

SECTION 1.06. Amendment and Restatement of the Existing Credit Agreement

     39   

ARTICLE II The Credits

     40   

SECTION 2.01. Commitments

     40   

SECTION 2.02. Loans and Borrowings

     40   

SECTION 2.03. Requests for Revolving Borrowings

     41   

SECTION 2.04. Determination of Dollar Amounts

     42   

SECTION 2.05. Protective Advances

     42   

SECTION 2.06. Swingline Loans and Overadvances

     43   

SECTION 2.07. Letters of Credit

     45   

SECTION 2.08. Funding of Borrowings

     49   

SECTION 2.09. Interest Elections

     49   

SECTION 2.10. Termination and Reduction of Commitments; Increase in Commitments

     51   

SECTION 2.11. Repayment and Amortization of Loans; Evidence of Debt

     52   

SECTION 2.12. Prepayment of Loans

     53   

SECTION 2.13. Fees

     54   

SECTION 2.14. Interest

     55   

SECTION 2.15. Alternate Rate of Interest

     56   

SECTION 2.16. Increased Costs

     57   

SECTION 2.17. Break Funding Payments

     58   

SECTION 2.18. Taxes

     58   

SECTION 2.18A. U.K. Tax

     61   

SECTION 2.19. Payments Generally; Allocation of Proceeds; Sharing of Set-offs

     64   

SECTION 2.20. Mitigation Obligations; Replacement of Lenders

     67   

SECTION 2.21. Defaulting Lenders

     68   

SECTION 2.22. Returned Payments

     69   

SECTION 2.23. Judgment Currency

     69   

SECTION 2.24. Designation of Foreign Subsidiary Borrowers

     70   

SECTION 2.25. Banking Services Obligations and Swap Obligations

     70   

ARTICLE III Representations and Warranties

     70   

SECTION 3.01. Organization; Powers

     70   

SECTION 3.02. Authorization; Enforceability

     71   

SECTION 3.03. Governmental Approvals; No Conflicts

     71   

SECTION 3.04. Financial Condition; No Material Adverse Change

     71   

SECTION 3.05. Properties

     71   

SECTION 3.06. Litigation and Environmental Matters

     71   

 

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SECTION 3.07. Compliance with Laws and Agreements

     72   

SECTION 3.08. Investment Company Status

     72   

SECTION 3.09. Taxes

     72   

SECTION 3.10. ERISA; Non-U.S. Pension Plans

     72   

SECTION 3.11. Disclosure

     73   

SECTION 3.12. Material Agreements

     73   

SECTION 3.13. Solvency

     73   

SECTION 3.14. Insurance

     73   

SECTION 3.15. Capitalization and Subsidiaries

     73   

SECTION 3.16. No Burdensome Restrictions

     74   

SECTION 3.17. Federal Reserve Regulations

     74   

SECTION 3.18. Security Interest in Collateral

     74   

SECTION 3.19. Employment Matters

     74   

SECTION 3.20. Common Enterprise

     74   

ARTICLE IV Conditions

     75   

SECTION 4.01. Effective Date

     75   

SECTION 4.02. Each Credit Event

     76   

SECTION 4.03. Designation of a Foreign Subsidiary Borrower

     77   

ARTICLE V Affirmative Covenants

     79   

SECTION 5.01. Financial Statements; Borrowing Base and Other Information

     79   

SECTION 5.02. Notices of Material Events

     82   

SECTION 5.03. Existence; Conduct of Business

     82   

SECTION 5.04. Payment of Obligations

     83   

SECTION 5.05. Maintenance of Properties

     83   

SECTION 5.06. Books and Records; Inspection Rights

     83   

SECTION 5.07. Compliance with Laws

     83   

SECTION 5.08. Use of Proceeds

     83   

SECTION 5.09. Insurance

     83   

SECTION 5.10. Casualty and Condemnation

     84   

SECTION 5.11. Appraisals

     84   

SECTION 5.12. Field Examinations

     84   

SECTION 5.13. Depository Banks

     84   

SECTION 5.14. Additional Collateral; Further Assurances

     84   

SECTION 5.15. Financial Assistance

     86   

ARTICLE VI Negative Covenants

     86   

SECTION 6.01. Indebtedness

     86   

SECTION 6.02. Liens

     87   

SECTION 6.03. Fundamental Changes

     89   

SECTION 6.04. Investments, Loans, Advances, Guarantees and Acquisitions

     89   

SECTION 6.05. Asset Sales

     90   

SECTION 6.06. Sale and Leaseback Transactions

     91   

SECTION 6.07. Swap Agreements

     91   

SECTION 6.08. Restricted Payments; Certain Payments of Indebtedness

     91   

SECTION 6.09. Transactions with Affiliates

     92   

SECTION 6.10. Restrictive Agreements

     93   

SECTION 6.11. Amendment of Material Documents

     93   

SECTION 6.12. Fixed Charge Coverage Ratio

     93   

 

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ARTICLE VII Events of Default

     93   

ARTICLE VIII The Administrative Agent and The Co-Collateral Agents

     96   

ARTICLE IX Miscellaneous

     101   

SECTION 9.01. Notices

     101   

SECTION 9.02. Waivers; Amendments

     103   

SECTION 9.03. Expenses; Indemnity; Damage Waiver

     104   

SECTION 9.04. Successors and Assigns

     106   

SECTION 9.05. Survival

     109   

SECTION 9.06. Counterparts; Integration; Effectiveness

     109   

SECTION 9.07. Severability

     109   

SECTION 9.08. Right of Setoff

     110   

SECTION 9.09. Governing Law; Jurisdiction; Consent to Service of Process

     110   

SECTION 9.10. WAIVER OF JURY TRIAL

     111   

SECTION 9.11. Headings

     111   

SECTION 9.12. Confidentiality

     111   

SECTION 9.13. Several Obligations; Nonreliance; Violation of Law

     112   

SECTION 9.14. USA PATRIOT Act

     112   

SECTION 9.15. Disclosure

     113   

SECTION 9.16. Appointment for Perfection

     113   

SECTION 9.17. Interest Rate Limitation

     113   

ARTICLE X Loan Guaranty

     113   

SECTION 10.01. Guaranty

     113   

SECTION 10.02. Guaranty of Payment

     114   

SECTION 10.03. No Discharge or Diminishment of Loan Guaranty

     114   

SECTION 10.04. Defenses Waived

     114   

SECTION 10.05. Rights of Subrogation

     115   

SECTION 10.06. Reinstatement; Stay of Acceleration

     115   

SECTION 10.07. Information

     115   

SECTION 10.08. Termination

     115   

SECTION 10.09. Taxes

     115   

SECTION 10.10. Maximum Liability

     116   

SECTION 10.11. Contribution

     116   

SECTION 10.12. Liability Cumulative

     116   

SECTION 10.13. Affected Foreign Subsidiaries

     117   

ARTICLE XI

     117   

The Borrower Representative

     117   

SECTION 11.01. Appointment; Nature of Relationship

     117   

SECTION 11.02. Powers

     117   

SECTION 11.03. Employment of Agents

     117   

SECTION 11.04. Notices

     117   

 

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SECTION 11.05. Successor Borrower Representative

     117   

SECTION 11.06. Execution of Loan Documents; Borrowing Base Certificate

     118   

SECTION 11.07. Reporting

     118   

ARTICLE XII

     118   

Collection Allocation Mechanism

     118   

SCHEDULES:

Schedule 2.01 – Commitments

Schedule 2.02 – Mandatory Cost

Schedule 2.07 – Existing Letters of Credit

Schedule 3.05 – Properties

Schedule 3.06 – Disclosed Matters

Schedule 3.14 – Insurance

Schedule 3.15 – Capitalization and Subsidiaries

Schedule 6.01 – Existing Indebtedness

Schedule 6.02 – Existing Liens

Schedule 6.04 – Existing Investments

Schedule 6.10 – Existing Restrictions

EXHIBITS:

Exhibit A – Form of Assignment and Assumption

Exhibit B – Form of Opinion of Loan Parties’ Counsel

Exhibit C – Form of Borrowing Base Certificate

Exhibit D – Form of Compliance Certificate

Exhibit E – Joinder Agreement

Exhibit F – List of Closing Documents

Exhibit G-1 – Form of U.S. Tax Certificate (for Non-U.S.

[Lenders][Participants] That Are Not Partnerships)

Exhibit G-2 – Form of U.S. Tax Certificate (for Non-U.S.

[Lenders][Participants] That Are Partnerships)

Exhibit H-1 – Form of Borrowing Subsidiary Agreement

Exhibit H-2 – Form of Borrowing Subsidiary Termination

 

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AMENDED AND RESTATED CREDIT AGREEMENT dated as of October 28, 2011 (as it may be
amended or modified from time to time, this “Agreement”), among LIFETIME BRANDS,
INC., the FOREIGN SUBSIDIARY BORROWERS from time to time party hereto, the other
Loan Parties party hereto, the Lenders party hereto, JPMORGAN CHASE BANK, N.A.,
as Administrative Agent and a Co- Collateral Agent, and HSBC BANK USA, NATIONAL
ASSOCIATION, as Syndication Agent and a Co-Collateral Agent.

WHEREAS, the Company, certain other Loan Parties, the Lenders and the
Administrative Agent are currently party to that certain Credit Agreement, dated
as of June 9, 2010 (the “Existing Credit Agreement”).

WHEREAS, the Borrowers, certain other Loan Parties, the Lenders and the
Administrative Agent have agreed to enter into this Agreement in order to
(i) amend and restate the Existing Credit Agreement in its entirety;
(ii) re-evidence the “Secured Obligations” under, and as defined in, the
Existing Credit Agreement, which shall be repayable in accordance with the terms
of this Agreement; and (iii) set forth the terms and conditions under which the
Lenders will, from time to time, make loans and extend other financial
accommodations to or for the benefit of the Borrowers.

WHEREAS, it is the intent of the parties hereto that this Agreement not
constitute a novation of the obligations and liabilities of the parties under
the Existing Credit Agreement or be deemed to evidence or constitute full
repayment of such obligations and liabilities, but that this Agreement amend and
restate in its entirety the Existing Credit Agreement and re-evidence the
obligations and liabilities of the Company and the other Loan Parties
outstanding thereunder, which shall be payable in accordance with the terms
hereof.

WHEREAS, it is also the intent of the Company and the “Loan Guarantors” (as
referred to and defined in the Existing Credit Agreement) to confirm that all
obligations under the “Loan Documents” (as referred to and defined in the
Existing Credit Agreement) shall continue in full force and effect as modified
and/or restated by the Loan Documents (as referred to and defined herein) and
that, from and after the Effective Date, all references to the “Credit
Agreement” contained in any such existing “Loan Documents” shall be deemed to
refer to this Agreement.

NOW, THEREFORE, in consideration of the premises and the mutual covenants
contained herein, the parties hereto hereby agree that the Existing Credit
Agreement is hereby amended and restated as follows:

ARTICLE I

Definitions

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

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

“Account” has the meaning assigned to such term in each Security Agreement.

“Account Debtor” means any Person obligated on an Account.

“Act” has the meaning assigned to such term in Section 9.14.

 

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“Adjusted LIBO Rate” means, with respect to any Eurocurrency Borrowing for any
Interest Period, an interest rate per annum (rounded upwards, if necessary, to
the next 1/16 of 1%) equal to the sum of (i) (a) the LIBO Rate for such Interest
Period multiplied by (b) the Statutory Reserve Rate plus, without duplication
(ii) in the case of Loans by a Lender from its office or branch in the United
Kingdom or any Participating Member State, the Mandatory Cost.

“Administrative Agent” means JPMorgan Chase Bank, N.A. (including its branches
and affiliates), in its capacity as administrative agent for the Lenders
hereunder.

“Administrative Questionnaire” means an Administrative Questionnaire in a form
supplied by the Administrative Agent.

“Affected Foreign Subsidiary” means any Foreign Subsidiary to the extent greater
than

65% of the Equity Interests of such Foreign Subsidiary being pledged to support
the Secured Obligations could reasonably be expected to cause a Deemed Dividend
Issue.

“Affiliate” means, 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.

“Agents” means, collectively, the Administrative Agent and the Co-Collateral
Agents.

“Aggregate Commitment” the aggregate of the Commitments of all of the Lenders,
as increased and/or reduced from time to time pursuant to the terms and
conditions hereof.

“Aggregate Credit Exposure” means, at any time, the aggregate Credit Exposure of
all the Lenders.

“Agreed Currencies” means (i) Dollars, (ii) euro, (iii) Pounds Sterling and
(iv) any other currency that is (x) a lawful currency (other than Dollars) that
is readily available and freely transferable and convertible into Dollars,
(y) available in the London interbank deposit market and (z) agreed to by the
Administrative Agent and each of the Multicurrency Tranche Lenders.

“Agreement” has the meaning set forth in the preliminary statements hereto.

“Alternate Base Rate” means, for any day, a rate per annum equal to the greatest
of (a) the Prime Rate in effect on such day, (b) the Federal Funds Effective
Rate in effect on such day plus  1⁄2 of 1% and (c) the Adjusted LIBO Rate for a
one month Interest Period on such day (or if such day is not a Business Day, the
immediately preceding Business Day) plus 1%; provided that, for the avoidance of
doubt, the Adjusted LIBO Rate for any day shall be based on the rate appearing
on the Reuters Screen LIBOR01 Page (or on any successor or substitute page of
such page) at approximately 11:00 a.m. London time on such day (without any
rounding). Any change in the Alternate Base Rate due to a change in the Prime
Rate, the Federal Funds Effective Rate or the Adjusted LIBO Rate shall be
effective from and including the effective date of such change in the Prime
Rate, the Federal Funds Effective Rate or the Adjusted LIBO Rate, respectively.

“Alternate Rate” means, for any day and for any Agreed Currency, the sum of
(a) a rate per annum selected by the Administrative Agent, in its reasonable
discretion based on market conditions in consultation with the Borrower
Representative (or the applicable Borrower), reflecting the cost to the Lenders
of obtaining funds plus (b) the Applicable Rate for Eurocurrency Revolving Loans
plus (c) the Mandatory Cost (without duplication). When used in reference to any
Loan or Borrowing, “Alternate Rate” refers to whether such Loan, or the Loans
comprising such Borrowing are bearing interest at a rate determined by reference
to the Alternate Rate.

 

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“Applicable Lender” has the meaning assigned to such term in Section 2.07(d).

“Applicable Percentage” means, (a) with respect to any Multicurrency Tranche
Lender in respect of a Multicurrency Tranche Credit Event, its Multicurrency
Tranche Percentage and (b) with respect to any Dollar Tranche Lender in respect
of a Dollar Tranche Credit Event, its Dollar Tranche Percentage.

“Applicable Pledge Percentage” means 100% but 65% in the case of a pledge by the
Company or any Domestic Subsidiary of its Equity Interests in a Foreign
Subsidiary that is an Affected Foreign Subsidiary due to a Deemed Dividend
Issue.

“Applicable Rate” means, for any day, with respect to any ABR Loan, Eurocurrency
Revolving Loan or Overnight LIBO Loan, or with respect to the commitment fees
payable hereunder, as the case may be, the applicable rate per annum set forth
below under the caption “ABR Spread”, “Eurocurrency Spread/Overnight LIBO
Spread” or “Commitment Fee Rate”, as the case may be, based upon the Average
Monthly Availability during the calendar month immediately preceding the most
recently ended calendar month:

 

    

Average Monthly

Availability

   ABR
Spread   Eurocurrency
Spread/Overnight
LIBO Spread   Commitment Fee
Rate

Category 1

  

Greater than

$95,000,000

   1.00%   2.00%   0.50%

Category 2

  

Less than or equal

to $95,000,000 but greater than

$65,000,000

   1.25%   2.25%   0.50%

Category 3

  

Less than or equal

to $65,000,000 but greater than

$35,000,000

   1.50%   2.50%   0.375%

Category 4

  

Less than or equal

to $35,000,000

   1.75%   2.75%   0.375%

For purposes of the foregoing, (a) the Applicable Rate shall be determined as of
the end of each calendar month based upon the Borrowing Base Certificates and
related information that are delivered from time to time pursuant to
Section 5.01 and (b) each change in the Applicable Rate resulting from a change
in the Average Monthly Availability shall be effective during the period
commencing on and including the first day of the calendar month immediately
following the date of delivery to the Administrative Agent of the Borrowing Base
Certificate indicating such change and ending on the date immediately preceding
the effective date of the next such change; provided that the Average Monthly
Availability shall be deemed to be (i) in Category 2 during the period from the
Effective Date to but excluding the first day of the first calendar month after
the three (3) month anniversary of the Effective Date and (ii) in Category 4
(A) at any time that an Event of Default has occurred and is continuing or
(B) at the option of the Administrative Agent or at the request of the Required
Lenders if the Company fails to deliver any Borrowing Base Certificate or
related information that is required to be delivered by it pursuant to
Section 5.01, during the period from the expiration of the time for delivery
thereof until each

 

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such Borrowing Base Certificate and related information pursuant to Section 5.01
is delivered; provided further that if any Borrowing Base Certificate is at any
time restated or otherwise revised or if the information set forth in any
Borrowing Base Certificate otherwise proves to be false or incorrect such that
the Applicable Rate would have been higher than was otherwise in effect during
any period, without constituting a waiver of any Default or Event of Default
arising as a result thereof, the Applicable Rate shall be immediately
recalculated at such higher rate for any applicable periods and shall be due and
payable on demand.

“Approved Foreign Subsidiary” means any Foreign Subsidiary which is requested by
the Company to be incorporated herein as a Foreign Subsidiary Borrower and
approved by the Lenders in their reasonable discretion.

“Approved Fund” has the meaning assigned to such term in Section 9.04.

“Assignment and Assumption” means an assignment and assumption agreement entered
into by a Lender and an assignee (with the consent of any party whose consent is
required by Section

9.04), and accepted by the Administrative Agent, in the form of Exhibit A or any
other form approved by the Administrative Agent.

“Availability” means, at any time, an amount equal to (a) the lesser of (i) the
Aggregate Commitment and (ii) the sum of the Domestic Borrowing Base plus the
Foreign Borrowing Base minus (b) the aggregate Revolving Exposures of all
Lenders, all as determined by the Administrative Agent in its Permitted
Discretion.

“Availability Period” means the period from and including the Effective Date to
but excluding the earlier of the Maturity Date and the date of termination of
the Commitments.

“Available Commitment” means, at any time, the Aggregate Commitment then in
effect minus the Revolving Exposure of all Lenders at such time; it being
understood and agreed that any Lender’s Swingline Exposure shall not be deemed
to be a component of the Revolving Exposure for purposes of calculating the
commitment fee under Section 2.13(a).

“Average Monthly Availability” means, for any calendar month, an amount equal to
the average daily Availability during such month.

“Banking Services” means each and any of the following bank services provided to
any Loan Party by any Lender or any of its Affiliates: (a) credit cards for
commercial customers (including, without limitation, commercial credit cards and
purchasing cards), (b) stored value cards and (c) treasury management services
(including, without limitation, controlled disbursement, automated clearinghouse
transactions, return items, overdrafts and interstate depository network
services).

“Banking Services Obligations” of the Loan Parties means any and all obligations
of the Loan Parties, whether absolute or contingent and howsoever and whensoever
created, arising, evidenced or acquired (including all renewals, extensions and
modifications thereof and substitutions therefor) in connection with Banking
Services.

“Banking Services Reserves” means all Reserves which the Administrative Agent
from time to time establishes in its Permitted Discretion for Banking Services
then provided or outstanding.

 

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“Bankruptcy Event” means, with respect to any Person, such Person becomes the
subject of a bankruptcy or insolvency proceeding, or has had a receiver,
conservator, trustee, administrator, custodian, assignee for the benefit of
creditors or similar Person charged with reorganization or liquidation of its
business, appointed for it, or, in the good faith determination of the
Administrative Agent, has taken any action in furtherance of, or indicating its
consent to, approval of, or acquiescence in, any such proceeding or appointment,
provided that a Bankruptcy Event shall not result solely by virtue of any
ownership interest, or the acquisition of any ownership interest, in such Person
by a Governmental Authority or instrumentality thereof, provided, further, that
such ownership interest does not result in or provide such Person with immunity
from the jurisdiction of courts within the United States or any other
jurisdiction or from the enforcement of judgments or writs of attachment on its
assets or permit such Person (or such Governmental Authority or
instrumentality), to reject, repudiate, disavow or disaffirm any contracts or
agreements made by such Person.

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

“Borrower” means the Company or any Foreign Subsidiary Borrower.

“Borrower Representative” has the meaning assigned to such term in
Section 11.01.

“Borrowing” means (a) Revolving Loans of the same Type, made, converted or
continued on the same date and, in the case of Eurocurrency Loans, as to which a
single Interest Period is in effect, (b) a Swingline Loan, (c) a Protective
Advance and (d) an Overadvance.

“Borrowing Base Certificate” means a certificate, signed and certified as
accurate and complete by a Financial Officer of a Borrower, in substantially the
form of Exhibit C or another form which is acceptable to the Administrative
Agent in its Permitted Discretion.

“Borrowing Request” means a request by a Borrower, or the Borrower
Representative on its behalf, for a Revolving Borrowing in accordance with
Section 2.03.

“Borrowing Subsidiary Agreement” means a Borrowing Subsidiary Agreement
substantially in the form of Exhibit H-1.

“Borrowing Subsidiary Termination” means a Borrowing Subsidiary Termination
substantially in the form of Exhibit H-2.

“Burdensome Restrictions” means any consensual encumbrance or restriction of the
type described in clause (a) or (b) of Section 6.10.

“Business Day” means 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 the relevant Agreed Currency in the London interbank market or
the principal financial center of such Agreed Currency (and, if the Borrowings
or LC Disbursements which are the subject of a borrowing, drawing, payment,
reimbursement or rate selection are denominated in euro, the term “Business Day”
shall also exclude any day on which the TARGET2 payment system is not open for
the settlement of payments in euro).

“CAM” means the mechanism for the allocation and exchange of interests in the
Designated Obligations and collections thereunder established under Article XII.

 

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“CAM Exchange” means the exchange of the Lenders’ interests provided for in
Article XII.

“CAM Exchange Date” means the first date on which there shall occur (a) any
event referred to in clause (h) or (i) of Article VII with respect to any
Borrower or (b) an acceleration of Loans pursuant to Article VII.

“CAM Percentage” means, as to each Revolving Lender, a fraction, expressed as a
decimal, of which (a) the numerator shall be the aggregate Dollar Amount
(determined on the basis of Exchange Rates prevailing on the CAM Exchange Date)
of the Designated Obligations owed to such Revolving Lender (whether or not at
the time due and payable) on the date immediately prior to the CAM Exchange Date
and (b) the denominator shall be the Dollar Amount (as so determined) of the
Designated Obligations owed to all the Lenders (whether or not at the time due
and payable) on the date immediately prior to the CAM Exchange Date.

“Capital Expenditures” means, without duplication, any expenditure or commitment
to expend money for any purchase or other acquisition of any asset which would
be classified as a fixed or capital asset on a consolidated balance sheet of the
Borrower and its Subsidiaries prepared in accordance with GAAP.

“Capital Lease Obligations” of any Person means 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 the amount of such obligations
shall be the capitalized amount thereof determined in accordance with GAAP.

“Change in Control” means (a) the acquisition of ownership, directly or
indirectly, beneficially or of record, by any Person or group (within the
meaning of the Securities Exchange Act of 1934 and the rules of the Securities
and Exchange Commission thereunder as in effect on the date hereof), of Equity
Interests representing more than 40% of the aggregate ordinary voting power
represented by the issued and outstanding Equity Interests of the Company;
(b) occupation of a majority of the seats (other than vacant seats) on the board
of directors of the Company by Persons who were neither (i) nominated by the
board of directors of the Company nor (ii) appointed by directors so nominated;
or (c) the acquisition of direct or indirect Control of the Company by any
Person or group; (d) the occurrence of a change in control, or other similar
provision, as defined in any agreement or instrument evidencing any Material
Indebtedness (triggering a default or mandatory prepayment, which default or
mandatory prepayment has not been waived in writing); or (e) the Company ceases
to own, directly or indirectly, and Control 100% (other than directors’
qualifying shares) of the ordinary voting economic power of any Foreign
Subsidiary Borrower (unless the Company shall have executed and delivered to the
Administrative Agent a Borrowing Subsidiary Termination with respect to such
Foreign Subsidiary Borrower and shall have satisfied the other requirements for
the termination of such Foreign Subsidiary Borrower as required pursuant to
Section 2.24).

“Change in Law” means (a) the adoption of any law, rule, regulation or treaty
(including any rules or regulations issued under or implementing any existing
law) after the date of this Agreement, (b) any change in any law, rule,
regulation or treaty or in the interpretation or application thereof by any
Governmental Authority after the date of this Agreement or (c) compliance by any
Lender or the Issuing Bank (or, for purposes of Section 2.16(b), by any lending
office of such Lender or by such Lender’s or the Issuing Bank’s holding company,
if any) with any request, guideline or directive (whether or not having the
force of law) of any Governmental Authority made or issued after the date of
this Agreement; provided that notwithstanding anything herein to the contrary,
(i) the Dodd-Frank Wall Street Reform and

 

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Consumer Protection Act and all requests, rules, guidelines or directives
thereunder, issued in connection therewith or in implementation thereof, and
(ii) all requests, rules, guidelines and directives promulgated by the Bank for
International Settlements, the Basel Committee on Banking Supervision (or any
successor or similar authority) or the United States or foreign regulatory
authorities, shall in each case be deemed to be a “Change in Law”, regardless of
the date enacted, adopted, issued or implemented.

“Chase” means JPMorgan Chase Bank, N.A., a national banking association, in its
individual capacity, and its successors.

“Class”, when used in reference to (a) any Loan or Borrowing, refers to whether
such Loan, or the Loans comprising such Borrowing, are Dollar Tranche Revolving
Loans, Multicurrency Tranche Revolving Loans, Swingline Loans, Protective
Advances or Overadvances and (b) any Commitment, refers to whether such
Commitment is a Multicurrency Tranche Commitment or a Dollar Tranche Commitment.

“Code” means the Internal Revenue Code of 1986, as amended.

“Co-Collateral Agents” means JPMorgan Chase Bank, N.A. and HSBC Bank USA,
National Association, in their capacities as co-collateral agents for the
Lenders hereunder.

“Collateral” means any and all property owned, leased or operated by any Loan
Party, now existing or hereafter acquired, that may at any time be or become
subject to a security interest or Lien in favor of the Administrative Agent, on
behalf of itself and the Secured Parties, to secure the Secured Obligations.

“Collateral Access Agreement” has the meaning assigned to such term in each
Security Agreement.

“Collateral Documents” means, collectively, the Security Agreements and any
other documents granting a Lien upon the Collateral as security for payment of
the Secured Obligations.

“Collection Account” has the meaning assigned to such term in each Security
Agreement.

“Commercial LC Exposure” means, at any time, the sum of (a) the aggregate
undrawn Dollar Amount of all outstanding Commercial Letters of Credit at such
time plus (b) the aggregate Dollar Amount of all LC Disbursements relating to
Commercial Letters of Credit that have not yet been reimbursed by or on behalf
of a Borrower at such time.

“Commercial Letters of Credit” means all Letters of Credit other than standby
Letters of Credit.

“Commitment” means, with respect to each Lender, the sum of such Lender’s Dollar
Tranche Commitment and Multicurrency Tranche Commitment. The initial amount of
each Lender’s Commitment is set forth on Schedule 2.01, or in the Assignment and
Assumption or other documentation contemplated hereby pursuant to which such
Lender shall have assumed its Commitment, as applicable.

“Company” means Lifetime Brands, Inc., a Delaware corporation.

“Company Revolving Exposure” means, with respect to any Lender at any time, and
without duplication, the sum of (a) the Dollar Amount of the outstanding
principal amount of the Revolving Loans made by such Lender to the Company plus
(b) such Lender’s LC Exposure with respect

 

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to Letters of Credit issued for the account of the Company plus (c) an amount
equal to such Lender’s Applicable Percentage of the aggregate principal amount
of Swingline Loans at such time made to the Company that such Lender has
purchased a participation in pursuant to Section 2.06 plus (d) an amount equal
to such Lender’s Applicable Percentage of the aggregate principal amount of
Overadvances made to the Company and outstanding at such time that such Lender
has purchased a participation in pursuant to Section 2.06.

“Computation Date” has the meaning assigned to such term in Section 2.04.

“Contribution Notice” means a contribution notice issued by the Pensions
Regulator pursuant to Section 38 or 47 of the United Kingdom Pensions Act 2004.

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

“Controlled Disbursement Account” means any accounts of any Loan Party
maintained with the Administrative Agent as a zero balance, cash management
account pursuant to and under any agreement between such Loan Party and the
Administrative Agent, as modified and amended from time to time, and through
which all disbursements of such Loan Party and any designated Subsidiary of the
Borrower are made and settled on a daily basis with no uninvested balance
remaining overnight.

“Credit Events” means a Borrowing, the issuance of a Letter of Credit, an LC
Disbursement or any of the foregoing.

“Credit Exposure” means, as to any Lender at any time, the sum of (a) such
Lender’s Revolving Exposure at such time, plus (b) an amount equal to its
Applicable Percentage, if any, of the aggregate principal amount of Protective
Advances outstanding at such time.

“Credit Party” means the Administrative Agent, the Issuing Bank, the Swingline
Lender or any other Lender.

“Deemed Dividend Issue” means, with respect to any Foreign Subsidiary, such
Foreign Subsidiary’s accumulated and undistributed earnings and profits being
deemed to be repatriated to the Company or the applicable parent Domestic
Subsidiary under Section 956 of the Code and the effect of such repatriation
causing adverse tax consequences to the Company or such parent Domestic
Subsidiary, in each case as determined by the Company in its commercially
reasonable judgment acting in good faith and in consultation with its legal and
tax advisors.

“Default” means any event or condition which constitutes an Event of Default or
which upon notice, lapse of time or both would, unless cured or waived, become
an Event of Default.

“Defaulting Lender” means any Lender that (a) has failed, within two
(2) Business Days of the date required to be funded or paid, to (i) fund any
portion of its Loans, (ii) fund any portion of its participations in Letters of
Credit or Swingline Loans or (iii) pay over to any Credit Party any other amount
required to be paid by it hereunder, unless, in the case of clause (i) above,
such Lender notifies the Administrative Agent in writing that such failure is
the result of such Lender’s good faith determination that a condition precedent
to funding (specifically identified and including the particular Default, if
any) has not been satisfied; (b) has notified any Borrower or any Credit Party
in writing, or has made a public statement, to the effect that it does not
intend or expect to comply with any of its funding obligations under this
Agreement (unless such writing or public statement indicates that such position
is

 

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based on such Lender’s good faith determination that a condition precedent to
funding under this Agreement (specifically identified and including the
particular Default, if any) cannot be satisfied) or generally under other
agreements in which it commits to extend credit, (c) has failed, within three
Business Days after request by a Credit Party, acting in good faith, to provide
a certification in writing from an authorized officer of such Lender that it
will comply with its obligations to fund prospective Loans and participations in
then outstanding Letters of Credit and Swingline Loans under this Agreement,
provided that such Lender shall cease to be a Defaulting Lender pursuant to this
clause (c) upon such Credit Party’s receipt of such certification in form and
substance satisfactory to it and the Administrative Agent, or (d) has become the
subject of a Bankruptcy Event.

“Deposit Account Control Agreement” has the meaning assigned to such term in
each Security Agreement.

“Designated Obligations” means all obligations of any Borrower with respect to
(a) principal of and interest on the Revolving Loans, (b) participations in
Swingline Loans, Overadvances and Protective Advances funded by the Lenders,
(c) unreimbursed LC Disbursements and interest thereon and (d) all commitment
fees and Letter of Credit participation fees.

“Disclosed Matters” means the actions, suits and proceedings and the
environmental matters disclosed in Schedule 3.06.

“Document” has the meaning assigned to such term in each Security Agreement.

“Dollar Amount” of any currency at any date shall mean (i) the amount of such
currency if such currency is Dollars or (ii) the equivalent in such currency of
Dollars if such currency is a Foreign Currency, calculated on the basis of the
Exchange Rate for such currency, on or as of the most recent Computation Date
provided for in Section 2.04.

“Dollars” or “$” refers to lawful money of the United States of America.

“Dollar Swingline Loan” has the meaning assigned to such term in
Section 2.06(a).

“Dollar Tranche Commitment” means, with respect to each Dollar Tranche Lender,
the commitment, if any, of such Dollar Tranche Lender to make Dollar Tranche
Revolving Loans and to acquire participations in Dollar Tranche Letters of
Credit, Swingline Loans, Overadvances and Protective Advances hereunder, as such
commitment may be (a) reduced or terminated from time to time pursuant to
Section 2.10, (b) increased from time to time pursuant to Section 2.10 and
(c) reduced or increased from time to time pursuant to assignments by or to such
Lender pursuant to Section 9.04. The initial amount of each Dollar Tranche
Lender’s Dollar Tranche Commitment is set forth on Schedule 2.01, or in the
Assignment and Assumption (or other documentation contemplated by this
Agreement) pursuant to which such Dollar Tranche Lender shall have assumed its
Dollar Tranche Commitment, as applicable. The aggregate principal amount of the
Dollar Tranche Commitments on the Effective Date is $130,000,000.

“Dollar Tranche Credit Event” means a Dollar Tranche Revolving Borrowing, the
issuance of a Dollar Tranche Letter of Credit, an LC Disbursement with respect
to a Dollar Tranche Letter of Credit, the making of a Swingline Loan,
Overadvance or Protective Advance that the Dollar Tranche Lenders are required
to participate in pursuant to Section 2.05 or 2.06, or any of the foregoing.

“Dollar Tranche LC Exposure” means, at any time, the sum of (a) the aggregate
undrawn Dollar Amount of all outstanding Dollar Tranche Letters of Credit at
such time plus (b) the aggregate Dollar Amount of all LC Disbursements in
respect of Dollar Tranche Letters of Credit that have not yet been reimbursed by
or on behalf of the Borrowers at such time. The Dollar Tranche LC Exposure of
any Dollar Tranche Lender at any time shall be its Dollar Tranche Percentage of
the total Dollar Tranche LC Exposure at such time.

 

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“Dollar Tranche Lender” means a Lender with a Dollar Tranche Commitment or
holding Dollar Tranche Revolving Loans.

“Dollar Tranche Letter of Credit” means any letter of credit issued under the
Dollar Tranche Commitments pursuant to this Agreement.

“Dollar Tranche Overadvance Exposure” means, at any time, the aggregate
principal amount of all outstanding Overadvances that the Dollar Tranche Lenders
have purchased participations in pursuant to Section 2.06. The Dollar Tranche
Overadvance Exposure of any Dollar Tranche Lender at any time shall be its
Dollar Tranche Percentage of the total Dollar Tranche Overadvance Exposure at
such time.

“Dollar Tranche Percentage” means the percentage equal to a fraction the
numerator of which is such Lender’s Dollar Tranche Commitment and the
denominator of which is the aggregate Dollar Tranche Commitments of all Dollar
Tranche Lenders (if the Dollar Tranche Commitments have terminated or expired,
the Dollar Tranche Percentages shall be determined based upon the Dollar Tranche
Commitments most recently in effect, giving effect to any assignments); provided
that in the case of Section 2.21 when a Defaulting Lender shall exist, any such
Defaulting Lender’s Dollar Tranche Commitment shall be disregarded in the
calculation.

“Dollar Tranche Protective Advance” has the meaning assigned to such term in
Section 2.05.

“Dollar Tranche Revolving Borrowing” means a Borrowing comprised of Dollar
Tranche Revolving Loans.

“Dollar Tranche Revolving Exposure” means, with respect to any Dollar Tranche
Lender at any time, and without duplication, the sum of (a) the outstanding
principal amount of such Lender’s Dollar Tranche Revolving Loans plus (b) such
Lender’s Dollar Tranche LC Exposure plus (c) such Lender’s Dollar Tranche
Swingline Exposure plus Exposure. (d) such Lender’s Dollar Tranche Overadvance
Exposure.

“Dollar Tranche Revolving Loan” means a Loan made by a Dollar Tranche Lender
pursuant to Section 2.01. Each Dollar Tranche Revolving Loan shall be a
Eurocurrency Revolving Loan denominated in Dollars or an ABR Revolving Loan
denominated in Dollars.

“Dollar Tranche Swingline Exposure” means, at any time, the aggregate principal
amount of all outstanding Swingline Loans that the Dollar Tranche Lenders have
purchased participations in pursuant to Section 2.06. The Dollar Tranche
Swingline Exposure of any Dollar Tranche Lender at any time shall be its Dollar
Tranche Percentage of the total Dollar Tranche Swingline Exposure at such time.

“Domestic Borrowing Base” means, at any time, the sum of (a) 85% of the Eligible
Accounts of the Domestic Loan Parties at such time, plus (b) the product of 85%
multiplied by the Net Orderly Liquidation Value percentage identified in the
most recent inventory appraisal ordered by the Co- Collateral Agents multiplied
by the Eligible Inventory of the Domestic Loan Parties, valued at the lower of
cost or market value, determined on a first-in-first-out basis, at such time,
plus (c) the lesser of (i) the product of 50% multiplied by an amount equal to
the Orderly Liquidation Value of Eligible Trademarks

 

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of the Domestic Loan Parties identified in the most recent trademark appraisal
ordered by the Co- Collateral Agents minus the cost of liquidation thereof and
(ii) $25,000,000 minus (d) Reserves. The Co- Collateral Agents may, in their
Permitted Discretion, reduce and thereafter (subject to Section 9.02(b)(v))
increase the advance rates set forth above, adjust Reserves or reduce and
thereafter (subject to Section 9.02(b)(v)) increase one or more of the other
elements used in computing the Domestic Borrowing Base.

“Domestic Loan Party” means each Loan Party that is organized under the laws of
a jurisdiction located in the United States of America.

“Domestic Security Agreement” means that certain Amended and Restated Pledge and
Security Agreement (including any and all supplements thereto), dated as of the
date hereof, between the Domestic Loan Parties and the Administrative Agent, for
the benefit of the Secured Parties, as the same may be amended, restated or
otherwise modified from time to time.

“Domestic Subsidiary” means a Subsidiary organized under the laws of a
jurisdiction located in the United States of America.

“EBITDA” means, for any period, Net Income for such period plus (a) without
duplication and to the extent deducted in determining Net Income for such
period, the sum of (i) Interest Expense for such period, (ii) income tax expense
for such period (net of tax refunds), (iii) all amounts attributable to
depreciation and amortization expense for such period, (iv) any non-cash charges
for such period (including non-cash charges for such period associated with
incurring the Second Lien Obligations, but excluding any non-cash charge in
respect of an item that was included in Net Income in a prior period), (v) any
advisory and other professional services fees and related expenses paid in
connection with Permitted Acquisitions (other than the first acquisition
constituting a Permitted Acquisition described in clause (a) of the definition
thereof) and any investments made pursuant to Section 6.04(n) in an aggregate
amount with respect to all such fees and expenses not to exceed $3,000,000 for
any twelve-month period, (vi) any advisory and other professional fees and
related expenses paid in connection with the first acquisition constituting a
Permitted Acquisition described in clause (a) of the definition thereof and the
first investment made pursuant to Section 6.04(n), in an aggregate amount with
respect to all such fees and expenses not to exceed $2,000,000 for the
twelve-month period ending on the first anniversary of the Effective Date, and
(vii) non-recurring charges incurred during such period, which shall not exceed,
in the aggregate for all periods, $1,000,000, minus (b) without duplication and
to the extent included in Net Income, (i) any cash payments made during such
period in respect of non-cash charges described in clause (a)(iv) taken in a
prior period and (ii) the sum of any extraordinary gains from sales, exchanges
and other dispositions of property not in the ordinary course of business, all
calculated for the Company and its Subsidiaries on a consolidated basis in
accordance with GAAP. Notwithstanding anything to the contrary in this
definition, for purposes hereof, the term “EBITDA” shall be calculated, for any
period, on a consistent basis, to reflect purchases and acquisitions made by the
Company or any Subsidiary of any Person or assets of any Person constituting a
business unit during such period as if such purchase or acquisition occurred at
the beginning of such period; provided that any amounts included in the
determination of “EBITDA” pursuant to this sentence for any period shall not
exceed an amount equal to 25% of the “EBITDA” of the Company for such period
determined without giving effect to this sentence.

“Effective Date” means the date on which the conditions specified in
Section 4.01 are satisfied (or waived in accordance with Section 9.02).

“Eligible Accounts” means, at any time, the Accounts of any Loan Party which the
Co- Collateral Agents determine in their Permitted Discretion are eligible as
the basis for the extension of Revolving Loans, Swingline Loans and the issuance
of Letters of Credit hereunder. Without limiting the Co-Collateral Agents’
Permitted Discretion as provided herein, Eligible Accounts shall not include any
Account:

(a) which is not subject to a first priority perfected security interest in
favor of the Administrative Agent;

 

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(b) which is subject to any Lien other than (i) a Lien in favor of the
Administrative Agent and (ii) a Permitted Encumbrance which does not have
priority over the Lien in favor of the Administrative Agent;

(c) which (i) is unpaid more than 120 days after the date of the original
invoice therefor or more than 90 days after the original due date, or (ii) has
been written off the books of such Loan Party or otherwise designated as
uncollectible;

(d) which is owing by an Account Debtor for which 25% or more of the Accounts
owing from such Account Debtor and its Affiliates are ineligible pursuant to
clause (c) above;

(e) which is owing by an Account Debtor to the extent the aggregate amount of
Accounts owing from such Account Debtor and its Affiliates to such Loan Party
exceeds 15% of the aggregate amount of Eligible Accounts; provided that, if such
Account Debtor has a long-term senior unsecured debt rating at such time of Baa2
or better by Moody’s and/or BBB or better by S&P, then Accounts owing from such
Account Debtor shall not be excluded from “Eligible Accounts” pursuant to this
clause, to the extent the aggregate amount of Accounts owing from such Account
Debtor and its Affiliates to such Loan Party does not exceed 35% of the
aggregate amount of Eligible Accounts;

(f) with respect to which any covenant, representation, or warranty contained in
any Loan Document has been breached or is not true;

(g) which (i) does not arise from the sale of goods or performance of services
in the ordinary course of business, (ii) is not evidenced by an invoice or other
documentation reasonably satisfactory to the Co-Collateral Agents which has been
sent to the Account Debtor, (iii) represents a progress billing, (iv) is
contingent upon such Loan Party’s completion of any further performance,
(v) represents a sale on a bill-and-hold, guaranteed sale, sale-and-return, sale
on approval, consignment, cash-on-delivery or any other repurchase or return
basis or (vi) relates to payments of interest;

(h) for which the goods giving rise to such Account have not been shipped to the
Account Debtor or for which the services giving rise to such Account have not
been performed by such Loan Party or if such Account was invoiced more than
once;

(i) with respect to which any check or other instrument of payment has been
returned uncollected for any reason;

(j) which is owed by an Account Debtor which has (i) applied for, suffered, or
consented to the appointment of any receiver, custodian, trustee, or liquidator
of its assets, (ii) has had possession of all or a material part of its property
taken by any receiver, custodian, trustee or liquidator, (iii) filed, or had
filed against it, any request or petition for liquidation, reorganization,
arrangement, adjustment of debts, adjudication as bankrupt, winding-up, or
voluntary or involuntary case under the bankruptcy laws of any jurisdiction,
(iv) has admitted in writing its inability, or is generally unable to, pay its
debts as they become due, (v) become insolvent, or (vi) ceased operation of its
business;

 

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(k) which is owed by any Account Debtor which has sold all or substantially all
of its assets;

(l) which is owed by an Account Debtor which (i) does not maintain its chief
executive office in the U.S., Canada or, solely with respect to any Account
Debtor of any Foreign Subsidiary Borrower, any Eligible Jurisdiction or (ii) is
not organized under applicable law of the U.S., any state of the U.S., Canada,
or any province of Canada, or, solely with respect to any Foreign Subsidiary
Borrower, any Eligible Jurisdiction, unless, in either case, such Account is
backed by a letter of credit reasonably acceptable to the Co-Collateral Agents
which is in the possession of, has been assigned to and is directly drawable by
the Administrative Agent; provided that, for so long as Tesco plc (“Tesco”) has
a long-term senior unsecured debt rating at such time of Baa2 or better by
Moody’s and/or BBB or better by S&P, Tesco’s and its Affiliates’ related
Accounts shall not be excluded from “Eligible Accounts” pursuant to this clause;

(m) which is owed in any currency other than (i) in the case of an Account of
any Domestic Loan Party, Dollars or Canadian dollars or (ii) in the case of an
Account of any Foreign Loan Party, Dollars, euro or Pounds Sterling;

(n) which is owed by (i) the government (or any department, agency, public
corporation, or instrumentality thereof) of any country other than the U.S.
unless such Account is backed by a Letter of Credit reasonably acceptable to the
Co-Collateral Agents which is in the possession of the Administrative Agent, or
(ii) the government of the U.S., or any department, agency, public corporation,
or instrumentality thereof, unless the Federal Assignment of Claims Act of 1940,
as amended (31 U.S.C. § 3727 et seq. and 41 U.S.C. § 15 et seq.), and any other
steps necessary to perfect the Lien of the Administrative Agent in such Account
have been complied with to the Co-Collateral Agents’ satisfaction;

(o) which is owed by any Affiliate, employee, officer, director, agent or
stockholder of any Loan Party;

(p) which, for any Account Debtor, exceeds a credit limit determined by the Co-
Collateral Agents, to the extent of such excess;

(q) which is owed by an Account Debtor or any Affiliate of such Account Debtor
to which any Loan Party is indebted, but only to the extent of such indebtedness
or is subject to any security, deposit, progress payment, retainage or other
similar advance made by or for the benefit of an Account Debtor, in each case to
the extent thereof;

(r) which is subject to any counterclaim, deduction, defense, setoff or dispute;

(s) which is evidenced by any promissory note, chattel paper, or instrument;

(t) which is owed by an Account Debtor located in any jurisdiction which
requires filing of a “Notice of Business Activities Report” or other similar
report in order to permit the applicable Loan Party to seek judicial enforcement
in such jurisdiction of payment of such Account, unless such Loan Party has
filed such report or qualified to do business in such jurisdiction;

 

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(u) with respect to which such Loan Party has made any agreement with the
Account Debtor for any reduction thereof, other than discounts and adjustments
given in the ordinary course of business, or any Account which was partially
paid and such Loan Party created a new receivable for the unpaid portion of such
Account;

(v) which does not comply in all material respects with the requirements of all
applicable laws and regulations, whether Federal, state or local, including
without limitation the Federal Consumer Credit Protection Act, the Federal Truth
in Lending Act and Regulation Z of the Board;

(w) which is for goods that have been sold under a purchase order or pursuant to
the terms of a contract or other agreement or understanding (written or oral)
that indicates or purports that any Person other than such Loan Party has or has
had an ownership interest in such goods, or which indicates any party other than
such Loan Party as payee or remittance party;

(x) which was created on cash on delivery terms;

(y) which is subject to any limitation on assignments or other security
interests (whether arising by operation of law, by agreement or otherwise),
unless the Co-Collateral Agents have determined that such limitation is not
enforceable;

(z) which is governed by the laws of any jurisdiction other than (i) in the case
of any Accounts of any Domestic Loan Party, the United States, any State thereof
or the District of Columbia, or (ii) in the case of any Account of any Foreign
Loan Party, the United States, any State thereof, the District of Columbia or
any Eligible Jurisdiction;

(aa) in respect of which the Account Debtor is a consumer within applicable
consumer protection litigation; or

(bb) which the Co-Collateral Agents determine may not be paid by reason of the
Account Debtor’s inability to pay.

In the event that an Account which was previously an Eligible Account ceases to
be an Eligible Account hereunder, the Borrowers shall notify the Administrative
Agent and the Co-Collateral Agents thereof on and at the time of submission to
the Administrative Agent and the Co-Collateral Agents of the next Borrowing Base
Certificate. In determining the amount of an Eligible Account, the face amount
of an Account may, in the Co-Collateral Agents’ Permitted Discretion, be reduced
by, without duplication, to the extent not reflected in such face amount,
(i) the amount of all accrued and actual discounts, claims, credits or credits
pending, promotional program allowances, price adjustments, finance charges or
other allowances (including any amount that the applicable Loan Party may be
obligated to rebate to an Account Debtor pursuant to the terms of any agreement
or understanding (written or oral)) and (ii) the aggregate amount of all cash
received in respect of such Account but not yet applied by the applicable Loan
Party to reduce the amount of such Account.

“Eligible Inventory” means, at any time, the Inventory of a Loan Party which the
Co- Collateral Agents determine in their Permitted Discretion is eligible as the
basis for the extension of Revolving Loans, Swingline Loans and the issuance of
Letters of Credit hereunder. Without limiting the Co-Collateral Agents’
Permitted Discretion as provided herein, Eligible Inventory shall not include
any Inventory:

 

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(a) which is not subject to a first priority perfected Lien (with respect to
Inventory located in the United States of any Domestic Loan Parties, governed by
the laws of the jurisdiction in which such Loan Party is organized and, with
respect to Inventory of any Foreign Loan Parties, governed by the laws of the
jurisdiction(s) in which such Loan Party is organized and where such Inventory
is located) in favor of the Administrative Agent;

(b) which is subject to any Lien other than (i) a Lien in favor of the
Administrative Agent and (ii) a Permitted Encumbrance which does not have
priority over the Lien in favor of the Administrative Agent;

(c) which is, in the Co-Collateral Agents’ opinion, obsolete, damaged or not
saleable within one year from the date of acquisition or creation thereof;

(d) with respect to which any covenant, representation, or warranty contained in
any Loan Document has been breached or is not true and which does not conform to
all standards imposed by any Governmental Authority;

(e) in which any Person other than the applicable Loan Party shall (i) have any
direct or indirect ownership, interest or title to such Inventory or (ii) be
indicated on any purchase order or invoice with respect to such Inventory as
having or purporting to have an interest therein;

(f) which constitutes work-in-process Inventory; provided that work-in-process
Inventory that constitutes the precious metals component of such Inventory
having a value not exceeding $4,000,000 in the aggregate for all Loan Parties at
any time shall not be excluded from “Eligible Inventory” pursuant to this
clause;

(g) which is not finished goods or which constitutes raw materials (other than
precious metals), spare or replacement parts, subassemblies, packaging and
shipping material, manufacturing supplies, samples, prototypes, displays or
display items, bill-and-hold goods, goods that are returned or marked for
return, repossessed goods, defective or damaged goods, goods held on
consignment, or goods which are not of a type held for sale in the ordinary
course of business;

(h) which (i) in the case of Inventory of Domestic Loan Parties, is not located
in the U.S. or is in transit with a common carrier from vendors and suppliers or
(ii) in the case of Inventory of Foreign Loan Parties, is not located in an
Eligible Jurisdiction, or is in transit with a common carrier from vendors and
suppliers; provided that (x) for purposes of clarity, Inventory located in the
Commonwealth of Puerto Rico shall be deemed to be located in the U.S. for
purposes of this clause, and (y) Inventory in transit with a common carrier from
vendors and suppliers having a value (based on invoiced amounts) not exceeding
$30,000,000 in the aggregate for all Loan Parties at any time shall not be
excluded from “Eligible Inventory” pursuant to this clause so long as (1) the
Administrative Agent and the Co-Collateral Agents shall have received a duly
executed Collateral Access Agreement from the applicable Loan Party’s customs
broker with respect to such Inventory, and (2) arrangements reasonably
satisfactory to the Co-Collateral Agents with respect to the “bills of lading”
and other “documents of title” (each as defined in the UCC) relating to such
Inventory shall have been made in order to protect the interests of the
Administrative Agent (for the benefit of the Secured Parties) in such “documents
of title” (as defined in the UCC) and such Inventory;

 

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(i) which is located in any location leased by the applicable Loan Party unless,
other than for the sixty (60) days immediately following the Effective Date,
(i) the lessor has delivered 15 to the Administrative Agent and the
Co-Collateral Agents a Collateral Access Agreement or (ii) a Reserve for rent,
charges, and other amounts due or to become due with respect to such facility
has been established by the Co-Collateral Agents in their Permitted Discretion;

(j) which is located in any third party warehouse or is in the possession of a
bailee (other than a third party processor) and is not evidenced by a Document,
unless, other than for the sixty (60) days immediately following the Effective
Date, (i) such warehouseman or bailee has delivered to the Administrative Agent
and the Co-Collateral Agents a Collateral Access Agreement and such other
documentation as the Co-Collateral Agents may require or (ii) an appropriate
Reserve has been established by the Co-Collateral Agents in their Permitted
Discretion;

(k) which is being processed offsite at a third party location or outside
processor, or is in-transit to or from said third party location or outside
processor;

(l) which is a discontinued product or component thereof;

(m) which is the subject of a consignment by the applicable Loan Party as
consignor;

(n) which is not reflected in a current perpetual inventory report of the
applicable Loan Party;

(o) for which reclamation or similar rights have been asserted by the seller; or

(p) for which any supply contract relating to such Inventory expressly includes
retention of title rights in favor of the related vendor or supplier, or is
subject to the laws of a jurisdiction which provides such retention of title
rights as a matter of law.

In the event that Inventory which was previously Eligible Inventory ceases to be
Eligible Inventory hereunder, the Borrowers shall notify the Administrative
Agent and the Co-Collateral Agents thereof on and at the time of submission to
the Administrative Agent and the Co-Collateral Agents of the next Borrowing Base
Certificate.

“Eligible Jurisdiction” means each jurisdiction where any Foreign Subsidiary
Borrower is organized and such other jurisdictions that the Co-Collateral Agents
may from time to time designate as an “Eligible Jurisdiction” in their Permitted
Discretion.

“Eligible Trademarks” means, at any time, the Trademarks of a Loan Party which
the Co- Collateral Agents determine in their Permitted Discretion are eligible
as the basis for the extension of Revolving Loans, Swingline Loans and the
issuance of Letters of Credit hereunder. Without limiting the Co-Collateral
Agents’ Permitted Discretion as provided herein, Eligible Trademarks shall not
include any Trademark:

(a) which is not subject to a first priority perfected Lien in favor of the
Administrative Agent; or

(b) which is subject to any Lien other than (i) a Lien in favor of the
Administrative Agent and (ii) a Permitted Encumbrance which does not have
priority over the Lien in favor of the Administrative Agent.

 

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In the event that a Trademark which was previously an Eligible Trademark ceases
to be an Eligible Trademark hereunder, the Company shall notify the
Administrative Agent and Co-Collateral Agents thereof on and at the time of
submission to the Administrative Agent and the Co-Collateral Agents of the next
Borrowing Base Certificate.

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

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

“Equipment” has the meaning assigned to such term in each Security Agreement.

“Equity Interests” means shares of capital stock, partnership interests,
membership interests in a limited liability company, beneficial interests in a
trust or other equity ownership interests in a Person, and any warrants, options
or other rights entitling the holder thereof to purchase or acquire any such
equity interest.

“Equivalent Amount” of any currency with respect to any amount of Dollars at any
date shall mean the equivalent in such currency of such amount of Dollars,
calculated on the basis of the Exchange Rate for such other currency at 11:00
a.m., London time, on the date on or as of which such amount is to be
determined.

“ERISA” means the Employee Retirement Income Security Act of 1974, as amended
from time to time.

“ERISA Affiliate” means any trade or business (whether or not incorporated)
that, together with the Company, 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” means (a) any “reportable event”, as defined in Section 4043 of
ERISA or the regulations issued thereunder with respect to a Plan (other than an
event for which the 30 day notice period is waived); (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; (d) the incurrence by the Company or any of its ERISA Affiliates of any
liability under Title IV of ERISA with respect to the termination of any Plan;
(e) the receipt by the Company or any ERISA Affiliate from the PBGC or a plan
administrator of any notice relating to an intention to terminate any Plan or
Plans or to appoint a trustee to administer any Plan; (f) the incurrence by the
Company or any of its ERISA Affiliates of any liability with respect to the
withdrawal or partial withdrawal of the Company or any of its ERISA Affiliates
from any Plan or

 

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Multiemployer Plan; or (g) the receipt by the Company or any ERISA Affiliate of
any notice, or the receipt by any Multiemployer Plan from the Company or any
ERISA Affiliate of any notice, concerning the imposition upon the Company or any
of its ERISA Affiliates 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.

“Establishment” means, in respect of any Person, any place of operations where
such Person carries out a non-transitory economic activity with human means and
goods, assets or services.

“euro” and/or “EUR” means the single currency of the Participating Member
States.

“Eurocurrency”, when used in reference to a currency means an Agreed Currency
and when used in reference to any Loan or Borrowing, means that such Loan, or
the Loans comprising such Borrowing, bears interest at a rate determined by
reference to the Adjusted LIBO Rate.

“Eurocurrency Payment Office” of the Administrative Agent shall mean, for each
Foreign Currency, the office, branch, affiliate or correspondent bank of the
Administrative Agent for such currency as specified from time to time by the
Administrative Agent to the Company and each Lender.

“Event of Default” has the meaning assigned to such term in Article VII.

“Exchange Rate” means, on any day, with respect to any Foreign Currency, the
rate at which such Foreign Currency may be exchanged into Dollars, as set forth
at approximately 11:00 a.m., Local Time, on such date on the Reuters World
Currency Page for such Foreign Currency. In the event that such rate does not
appear on any Reuters World Currency Page, the Exchange Rate with respect to
such Foreign Currency shall be determined by reference to such other publicly
available service for displaying exchange rates as may be reasonably selected by
the Administrative Agent or, in the event no such service is selected, such
Exchange Rate shall instead be calculated on the basis of the arithmetical mean
of the buy and sell spot rates of exchange of the Administrative Agent for such
Foreign Currency on the London market at 11:00 a.m., Local Time, on such date
for the purchase of Dollars with such Foreign Currency, for delivery two
Business Days later; provided, that if at the time of any such determination,
for any reason, no such spot rate is being quoted, the Administrative Agent,
after consultation with the Company, may use any reasonable method it deems
appropriate to determine such rate, and such determination shall be conclusive
absent manifest error.

“Excluded Taxes” means, with respect to any payment made by any Loan Party under
any Loan Document, any of the following Taxes imposed on or with respect to a
Recipient:

(a) income or franchise Taxes imposed on (or measured by) net income by the
United States of America, or by the jurisdiction under the laws of which such
Recipient is organized or in which its principal office is located or, in the
case of any Lender, in which its applicable lending office is located;

(b) any branch profits Taxes imposed by the United States of America or any
similar Taxes imposed by any other jurisdiction in which any Borrower is
located; and

(c) in the case of a Non-U.S. Lender (other than an assignee pursuant to a
request by any Borrower under Section 2.20(b)), any U.S. Federal withholding
Taxes resulting from any law in effect (including FATCA) on the date such
Non-U.S. Lender becomes a party to this Agreement (or designates a new lending
office) or is attributable to such Non-U.S. Lender’s failure to comply with
Section 2.18(f), except to the extent that such Non-U.S. Lender (or its
assignor, if any) was entitled, at the time of designation of a new lending
office (or assignment), to receive additional amounts from the Borrowers with
respect to such withholding Taxes pursuant to Section 2.18(a).

 

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“Existing Credit Agreement” has the meaning set forth in the preliminary
statements hereto.

“Existing Letters of Credit” has the meaning assigned to such term in
Section 2.07(a).

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

“Federal Funds Effective Rate” means, for any day, the weighted average (rounded
upwards, 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 that is a Business Day, the average (rounded upwards, if necessary, to
the next 1/100 of 1%) of the quotations for such day for such transactions
received by the Administrative Agent from three Federal funds brokers of
recognized standing selected by it.

“Financial Officer” means the chief financial officer, principal accounting
officer, treasurer or controller of the Company and, in the case of a Foreign
Subsidiary Borrower, also means each person performing similar duties as the
foregoing (including any director of a Foreign Subsidiary Borrower acting in
such capacity).

“Financial Support Direction” means a financial support direction issued by the
Pensions Regulator pursuant to Section 43 of the United Kingdom Pensions Act
2004.

“First Tier Foreign Subsidiary” means each Foreign Subsidiary with respect to
which the Company and/or any Domestic Subsidiary directly owns or Controls more
than 50% of such Foreign Subsidiary’s issued and outstanding Equity Interests.

“Fixed Charges” means, with reference to any period, without duplication,
(a) cash Interest Expense, plus (b) the aggregate amount of prepayments and
scheduled principal payments of Indebtedness by the Company and its Subsidiaries
made during such period (other than prepayments and repayments of the Secured
Obligations), determined in accordance with GAAP, plus (c) the positive
difference, if any, of (i) the expense for income taxes paid in cash during such
period by the Company and its Subsidiaries minus (ii) the aggregate amount of
any cash income taxes refunded in such period, plus (d) the aggregate amount of
Restricted Payments paid by the Company in cash during such period.

“Fixed Charge Coverage Ratio” means, for any period, the ratio of (a) EBITDA
minus the unfinanced portion of Capital Expenditures to (b) Fixed Charges, all
calculated for the Company and its Subsidiaries on a consolidated basis in
accordance with GAAP.

“Fixtures” has the meaning assigned to such term in each Security Agreement.

“Foreign Borrowers Revolving Exposure” means, with respect to any Lender at any
time, and without duplication, the sum of (a) the Dollar Amount of the
outstanding principal amount of Revolving Loans made by such Lender to the
Foreign Subsidiary Borrowers plus (b) the Dollar Amount of such Lender’s LC
Exposure with respect to Letters of Credit issued for the account of the Foreign
Subsidiary Borrowers plus (c) an amount equal to such Lender’s Applicable
Percentage of the Dollar Amount of the aggregate principal amount of Swingline
Loans at such time made to the Foreign

 

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Subsidiary Borrowers that such Lender has purchased a participation in pursuant
to Section 2.06 plus (d) an amount equal to such Lender’s Applicable Percentage
of the Dollar Amount of the aggregate principal amount of Overadvances made to
the Foreign Subsidiary Borrowers and outstanding at such time that such Lender
has purchased a participation in pursuant to Section 2.06.

“Foreign Borrowers Utilization” means, at any time, the excess, if any, of
(a) the aggregate Foreign Borrowers Revolving Exposures of all Lenders over
(b) the Foreign Borrowing Base.

“Foreign Borrowing Base” means, at any time, the sum of (a) 85% of the Eligible
Accounts of the Foreign Loan Parties at such time, plus (b) the product of 85%
multiplied by the Net Orderly Liquidation Value percentage identified in the
most recent inventory appraisal ordered by the Co- Collateral Agents multiplied
by the Eligible Inventory of the Foreign Loan Parties, valued at the lower of
cost or market value, determined on a first-in-first-out basis, at such time,
minus (c) Reserves. The Co- Collateral Agents may, in their Permitted
Discretion, reduce and thereafter (subject to Section 9.02(b)(v)) increase the
advance rates set forth above, adjust Reserves or reduce and thereafter (subject
to Section 9.02(b)(v)) increase one or more of the other elements used in
computing the Foreign Borrowing Base.

“Foreign Currencies” means Agreed Currencies other than Dollars.

“Foreign Currency LC Exposure” means, at any time, the sum of (a) the Dollar
Amount of the aggregate undrawn and unexpired amount of all outstanding Foreign
Currency Letters of Credit at such time plus (b) the aggregate principal Dollar
Amount of all LC Disbursements in respect of Foreign Currency Letters of Credit
that have not yet been reimbursed at such time.

“Foreign Currency Letter of Credit” means a Letter of Credit denominated in a
Foreign Currency.

“Foreign Loan Parties” means each Loan Party that is not organized under the
laws of a jurisdiction located in the United States of America.

“Foreign Secured Obligations” means all Secured Obligations of the Foreign Loan
Parties arising under the Loan Documents.

“Foreign Security Agreement” means, individually and collectively as the context
may require, each pledge agreement, security agreement, charge, debenture,
mortgage, guarantee or other agreement that is entered into by any Foreign Loan
Party in favor of the Administrative Agent, and any other pledge agreement,
security agreement or other agreement entered into pursuant to the terms of the
Loan Documents, securing the Foreign Secured Obligations, in each case in form
and substance satisfactory to Administrative Agent and entered into pursuant to
the terms of this Agreement or any other Loan Document (including Sections 4.03
and 5.14 hereof).

“Foreign Subsidiary” means any Subsidiary which is not a Domestic Subsidiary.

“Foreign Subsidiary Borrowers” means, collectively, each Approved Foreign
Subsidiary that becomes a Foreign Subsidiary Borrower pursuant to Section 2.24
and that has not ceased to be a Foreign Subsidiary Borrower pursuant to such
Section.

“Foreign Subsidiary Borrower Effective Date” means, with respect to any Foreign
Subsidiary Borrower, the date on which such Foreign Subsidiary Borrower becomes
a Foreign Subsidiary Borrower under this Agreement and is entitled to make
Borrowings hereunder after satisfying the relevant conditions set forth in
Section 4.03.

 

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“Foreign Subsidiary Guarantors” means, collectively, each Subsidiary of a
Foreign Subsidiary Borrower that is a party to this Agreement, becomes a party
to this Agreement pursuant to a Joinder Agreement or becomes a party to a
Foreign Security Agreement, in each case, and their successors and assigns.

“Funding Accounts” has the meaning assigned to such term in Section 4.01(g).

“GAAP” means generally accepted accounting principles in the United States of
America.

“Governmental Authority” means the government of the United States of America,
any other nation or any political subdivision thereof, whether state or local,
and any agency, authority, instrumentality, regulatory body, court, central bank
or other entity exercising executive, legislative, judicial, taxing, regulatory
or administrative powers or functions of or pertaining to government.

“Guarantee” of or by any Person (the “guarantor”) means 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, (a) to purchase
or pay (or advance or supply funds for the purchase or payment of) such
Indebtedness or other obligation or to purchase (or to advance or supply funds
for the purchase of) any security for the payment thereof, (b) 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, (c) to maintain
working capital, equity capital or any other financial statement condition or
liquidity of the primary obligor so as to enable the primary obligor to pay such
Indebtedness or other obligation or (d) as an account party in respect of any
letter of credit or letter of guaranty issued to support such Indebtedness or
obligation; provided, that the term Guarantee shall not include endorsements for
collection or deposit in the ordinary course of business.

“Guaranteed Obligations” has the meaning assigned to such term in Section 10.01.

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

“Hostile Acquisition” means (a) the acquisition of the Equity Interests of a
Person through a tender offer or similar solicitation of the owners of such
Equity Interests which has not been approved (prior to such acquisition) by the
board of directors (or any other applicable governing body) of such Person or by
similar action if such Person is not a corporation and (b) any such acquisition
as to which such approval has been withdrawn.

“Indebtedness” of any Person means, without duplication, (a) all obligations of
such Person for borrowed money or with respect to deposits or advances of any
kind, (b) all obligations of such Person evidenced by bonds, debentures, notes
or similar instruments, (c) all obligations of such Person upon which interest
charges are customarily paid, (d) all obligations of such Person under
conditional sale or other title retention agreements relating to property
acquired by such Person, (e) all obligations of such Person in respect of the
deferred purchase price of property or services (excluding current accounts
payable incurred in the ordinary course of business), (f) all Indebtedness of
others secured by (or for which the holder of such Indebtedness has an existing
right, contingent or otherwise, to be secured by) any Lien on property owned or
acquired by such Person, whether or not the Indebtedness secured thereby has
been assumed, (g) all Guarantees by such Person of Indebtedness of others,
(h) all Capital Lease

 

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Obligations of such Person, (i) all obligations, contingent or otherwise, of
such Person as an account party in respect of letters of credit and letters of
guaranty, (j) all obligations, contingent or otherwise, of such Person in
respect of bankers’ acceptances, (k) obligations under any liquidated earn-out
and (l) any other Off-Balance Sheet Liability. The Indebtedness of any Person
shall include the Indebtedness of any other entity (including any partnership in
which such Person is a general partner) to the extent such Person is liable
therefor as a result of such Person’s ownership interest in or other
relationship with such entity, except to the extent the terms of such
Indebtedness provide that such Person is not liable therefor.

“Indemnified Taxes” means (a) Taxes, other than Excluded Taxes, imposed on or
with respect to any payment made by any Loan Party under any Loan Document and
(b) Other Taxes.

“Intercreditor Agreement” means that certain Intercreditor Agreement, dated as
of the Original Effective Date, by and among the Administrative Agent, Citibank,
N.A., in its capacity as administrative agent under the Second Lien Documents,
and each of the Loan Parties party thereto.

“Interest Election Request” means a request by a Borrower to convert or continue
a Revolving Borrowing in accordance with Section 2.09.

“Interest Expense” means, with reference to any period, total interest expense
(including that attributable to Capital Lease Obligations) of the Company and
its Subsidiaries for such period with respect to all outstanding Indebtedness of
the Company and its Subsidiaries (including all commissions, discounts and other
fees and charges owed with respect to letters of credit and bankers’ acceptance
financing and net costs under Swap Agreements in respect of interest rates to
the extent such net costs are allocable to such period in accordance with GAAP),
calculated on a consolidated basis for the Company and its Subsidiaries for such
period in accordance with GAAP. For purposes of clarity, “Interest Expense”
shall not include any non-cash “mark-to-market” accounting adjustments in
respect of such Swap Agreements.

“Interest Payment Date” means (a) with respect to any ABR Loan (other than a
Swingline Loan), the first Business Day of each calendar month and the Maturity
Date, (b) 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 prior to the last day of such Interest Period that occurs at
intervals of three months’ duration after the first day of such Interest Period
and the Maturity Date, (c) with respect to any Swingline Loan, the day that such
Swingline Loan is required to be repaid and the Maturity Date, and (d) with
respect to any Overnight LIBO Loan (other than a Swingline Loan), the first
Business Day of each calendar month, the date that such Overnight LIBO Loan is
required to be repaid and the Maturity Date.

“Interest Period” means with respect to any Eurocurrency Borrowing, the period
commencing on the date of such Borrowing and ending on the numerically
corresponding day in the calendar month that is two weeks or one, two, three or
six months thereafter, as the applicable Borrower (or the Company on behalf of
the applicable Borrower) may elect; provided, that (i) 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, in the case of a
Eurocurrency Borrowing only, 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, (ii) any Interest Period pertaining to a Eurocurrency
Borrowing that commences on the last Business Day of a calendar month (or on a
day for which there is no numerically corresponding day in the last calendar
month of such Interest Period) shall end on the last Business Day of the last
calendar month of such Interest Period, and (iii) solely for purposes of the
penultimate sentence in Section 2.06(e), “Interest Period” shall also mean an
interest period of one week for Multicurrency Swingline Loans or Overadvances
denominated in Foreign Currencies. For purposes hereof, the date of a Borrowing
initially shall be the date on which such Borrowing is made and, in the case of
a Revolving Borrowing, thereafter shall be the effective date of the most recent
conversion or continuation of such Borrowing.

 

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“Inventory” has the meaning assigned to such term in each Security Agreement.

“IRS” means the United States Internal Revenue Service.

“Issuing Bank” means (i) Chase, in its capacity as the issuer of Letters of
Credit hereunder, and its successors in such capacity as provided in
Section 2.07(i), and (ii) solely in respect of certain Existing Letters of
Credit, HSBC Bank USA, National Association, in its capacity as the issuer of
such Existing Letters of Credit. Chase, in its capacity as the Issuing Bank,
may, in its discretion, arrange for one or more Letters of Credit to be issued
by Affiliates of the Issuing Bank, in which case the term “Issuing Bank” shall
include any such Affiliate with respect to Letters of Credit issued by such
Affiliate.

“ITA” means the United Kingdom Income Tax Act of 2007.

“Joinder Agreement” has the meaning assigned to such term in Section 5.14(a).

“LC Collateral Account” has the meaning assigned to such term in
Section 2.07(j).

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

“LC Exposure” means, at any time, the sum of Commercial LC Exposure and Standby
LC Exposure. The LC Exposure of any Multicurrency Tranche Lender at any time
shall be its Multicurrency Tranche Percentage of the total Multicurrency Tranche
LC Exposure at such time and the LC Exposure of any Dollar Tranche Lender at any
time shall be its Dollar Tranche Percentage of the total Dollar Tranche LC
Exposure at such time.

“Lenders” means the Persons listed on Schedule 2.01 and any other Person that
shall have become a party hereto pursuant to an Assignment and Assumption, other
than any such Person that ceases to be a party hereto pursuant to an Assignment
and Assumption. Unless the context otherwise requires, the term “Lenders”
includes the Swingline Lender.

“Letter of Credit” means any letter of credit issued pursuant to this Agreement.

“LIBO Rate” means, with respect to any Eurocurrency Borrowing for any Interest
Period, the rate appearing on, in the case of Dollars, Reuters Screen LIBOR01
Page and, in the case of any Foreign Currency, the appropriate page of such
service which displays British Bankers Association Interest Settlement Rates for
deposits in such Foreign Currency (or, in each case, on any successor or
substitute page of such service, or any successor to or substitute for such
service, providing rate quotations comparable to those currently provided on
such page of such service, as determined by the Administrative Agent from time
to time for purposes of providing quotations of interest rates applicable to
deposits in the relevant Agreed Currency in the London interbank market) at
approximately 11:00 a.m., London time, two (2) Business Days prior to (or, in
the case of Loans denominated in Pounds Sterling, on the day of) the
commencement of such Interest Period, as the rate for deposits in the relevant
Agreed Currency with a maturity comparable to such Interest Period. In the event
that such rate is not available at such time for any reason, then the “LIBO
Rate” with respect to such Eurocurrency Borrowing for such Interest Period shall
be the rate at which deposits in the relevant Agreed Currency in an Equivalent
Amount of $5,000,000 and for a maturity comparable to such Interest Period are
offered by the principal

 

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London office of the Administrative Agent in immediately available funds in the
London interbank market at approximately 11:00 a.m., London time, two
(2) Business Days prior to (or, in the case of Loans denominated in Pounds
Sterling, on the day of) the commencement of such Interest Period.

“Lien” means, with respect to any asset, (a) any mortgage, deed of trust, lien,
pledge, hypothecation, encumbrance, assignment by way of security, charge or
security interest in, on or of 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, any purchase option, call or similar right of a third party with
respect to such securities.

“Loan Documents” means this Agreement, each Borrowing Subsidiary Agreement, each
Borrowing Subsidiary Termination, any promissory notes issued pursuant to
Section 2.11(f) of this Agreement, any Letter of Credit applications, the
Collateral Documents, the Loan Guaranty, the Intercreditor Agreement and all
other agreements, instruments, documents and certificates identified in
Section 4.01 or 4.03 executed and delivered to, or in favor of, the
Administrative Agent, any Lenders or any Secured Parties and including all other
pledges, powers of attorney, consents, assignments, contracts, notices, letter
of credit agreements and all other written matter whether heretofore, now or
hereafter executed by or on behalf of any Loan Party, or any employee of any
Loan Party, and delivered to the Administrative Agent, any Lender or any Secured
Party in connection with the Agreement or the transactions contemplated thereby.
Any reference in the Agreement or any other Loan Document to a Loan Document
shall include all appendices, exhibits or schedules thereto, and all amendments,
restatements, supplements or other modifications thereto, and shall refer to the
Agreement or such Loan Document as the same may be in effect at any and all
times such reference becomes operative.

“Loan Guarantor” means each Loan Party.

“Loan Guaranty” means Article X of this Agreement and each separate guaranty
that constitutes a Foreign Security Agreement.

“Loan Parties” means the Borrowers, the Company’s Domestic Subsidiaries, the
Foreign Subsidiary Guarantors and any other Person who either becomes a party to
this Agreement pursuant to a Joinder Agreement or becomes a party to a Foreign
Security Agreement and their successors and assigns.

“Loans” means the loans and advances made by the Lenders pursuant to this
Agreement, including Swingline Loans, Overadvances and Protective Advances.

“Local Time” means (i) New York City time in the case of a Dollar Tranche Credit
Event and (ii) local time in the case of a Multicurrency Tranche Credit Event
(it being understood that such local time shall mean London, England time unless
otherwise notified by the Administrative Agent).

“Mandatory Cost” means, with respect to any period, the percentage rate per
annum determined in accordance with Schedule 2.02.

“Margin Stock” means “margin stock” as such term is defined in Regulation T, U
or X of the Board.

“Material Adverse Effect” means a material adverse effect on (a) the business,
assets, operations, prospects or condition (financial or otherwise) of the
Company, or the Company and the Subsidiaries taken as a whole, (b) the ability
of any Loan Party to perform any of its obligations under the Loan Documents to
which it is a party, (c) the Collateral, or the Administrative Agent’s Liens (on
behalf of itself and the Secured Parties) on the Collateral or the priority of
such Liens, or (d) the rights of or benefits available to the Administrative
Agent, the Issuing Bank, the Lenders or the Secured Parties thereunder.

 

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“Material Indebtedness” means Indebtedness (other than the Loans and Letters of
Credit), or obligations in respect of one or more Swap Agreements, of any one or
more of the Company and its Subsidiaries in an aggregate principal amount
exceeding $5,000,000. For purposes of determining Material Indebtedness, the
“obligations” of the Company or any Subsidiary in respect of any Swap Agreement
at any time shall be the maximum aggregate amount (giving effect to any netting
agreements) that the Company or such Subsidiary would be required to pay if such
Swap Agreement were terminated at such time.

“Maturity Date” means the earliest of (i) October 28, 2016, (ii) March 10, 2015,
to the extent (x) the loans and other credit extensions under the Second Lien
Documents have not been fully repaid by such date, (y) the “Final Maturity Date”
under and as defined in the Second Lien Documents has not been extended to a
date on or after the date specified in the preceding clause (i) by such date or
(z) the Second Lien Obligations Reserve has not been established by the
Co-Collateral Agents in their Permitted Discretion by such date, and (iii) any
date on which the Commitments are reduced to zero or otherwise terminated
pursuant to the terms hereof.

“Maximum Liability” has the meaning assigned to such term in Section 10.10.

“Moody’s” means Moody’s Investors Service, Inc.

“Multicurrency Swingline Loan” has the meaning assigned to such term in Section
2.06(b).

“Multicurrency Tranche Commitment” means, with respect to each Multicurrency
Tranche Lender, the commitment, if any, of such Multicurrency Tranche Lender to
make Multicurrency Tranche Revolving Loans and to acquire participations in
Multicurrency Tranche Letters of Credit, Swingline Loans, Overadvances and
Protective Advances hereunder, as such commitment may be (a) reduced or
terminated from time to time pursuant to Section 2.10, (b) increased from time
to time pursuant to Section 2.10 and (c) reduced or increased from time to time
pursuant to assignments by or to such Lender pursuant to Section 9.04. The
initial amount of each Multicurrency Tranche Lender’s Multicurrency Tranche
Commitment is set forth on Schedule 2.01, or in the Assignment and Assumption
(or other documentation contemplated by this Agreement) pursuant to which such
Multicurrency Tranche Lender shall have assumed its Multicurrency Tranche
Commitment, as applicable. The aggregate principal amount of the Multicurrency
Tranche Commitments on the Effective Date is $20,000,000.

“Multicurrency Tranche Credit Event” means a Multicurrency Tranche Revolving
Borrowing, the issuance of a Multicurrency Letter of Credit, an LC Disbursement
with respect to a Multicurrency Tranche Letter of Credit, the making of a
Swingline Loan, Overadvance or Protective Advance that the Multicurrency Tranche
Lenders are required to participate in pursuant to Section 2.05 or

2.06, or any of the foregoing.

“Multicurrency Tranche LC Exposure” means, at any time, the sum of (a) the
aggregate undrawn Dollar Amount of all outstanding Multicurrency Tranche Letters
of Credit at such time plus (b) the aggregate Dollar Amount of all LC
Disbursements in respect of Multicurrency Tranche Letters of Credit that have
not yet been reimbursed by or on behalf of the Borrowers at such time. The
Multicurrency Tranche LC Exposure of any Multicurrency Tranche Lender at any
time shall be its Multicurrency Tranche Percentage of the total Multicurrency
Tranche LC Exposure at such time.

 

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“Multicurrency Tranche Lender” means a Lender with a Multicurrency Tranche
Commitment or holding Multicurrency Tranche Revolving Loans.

“Multicurrency Tranche Letter of Credit” means any letter of credit issued under
the Multicurrency Tranche Commitments pursuant to this Agreement.

“Multicurrency Tranche Overadvance Exposure” means, at any time, the aggregate
principal amount of all outstanding Overadvances that the Multicurrency Tranche
Lenders have purchased participations in pursuant to Section 2.06. The
Multicurrency Tranche Overadvance Exposure of any Multicurrency Tranche Lender
at any time shall be its Multicurrency Tranche Percentage of the total
Multicurrency Tranche Overadvance Exposure at such time.

“Multicurrency Tranche Percentage” means the percentage equal to a fraction the
numerator of which is such Lender’s Multicurrency Tranche Commitment and the
denominator of which is the aggregate Multicurrency Tranche Commitments of all
Multicurrency Tranche Lenders (if the Multicurrency Tranche Commitments have
terminated or expired, the Multicurrency Tranche Percentages shall be determined
based upon the Multicurrency Tranche Commitments most recently in effect, giving
effect to any assignments); provided that in the case of Section 2.21 when a
Defaulting Lender shall exist, any such Defaulting Lender’s Multicurrency
Tranche Commitment shall be disregarded in the calculation.

“Multicurrency Tranche Protective Advance” has the meaning assigned to such term
in Section 2.05.

“Multicurrency Tranche Revolving Borrowing” means a Borrowing comprised of
Multicurrency Tranche Revolving Loans.

“Multicurrency Tranche Revolving Exposure” means, with respect to any
Multicurrency Tranche Lender at any time, and without duplication, the sum of
(a) the Dollar Amount of the outstanding principal amount of such Lender’s
Multicurrency Tranche Revolving Loans plus (b) the Dollar Amount of such
Lender’s Multicurrency Tranche LC Exposure at such time plus (c) the Dollar
Amount of such Lender’s Multicurrency Tranche Swingline Exposure plus (d) the
Dollar Amount of such Lender’s Multicurrency Tranche Overadvance Exposure.

“Multicurrency Tranche Revolving Loan” means a Loan made by a Multicurrency
Tranche Lender pursuant to Section 2.01. Each Multicurrency Tranche Revolving
Loan shall be a Eurocurrency Revolving Loan denominated in an Agreed Currency.

“Multicurrency Tranche Swingline Exposure” means, at any time, the Dollar Amount
of the aggregate principal amount of all outstanding Swingline Loans that the
Multicurrency Tranche Lenders have purchased participations in pursuant to
Section 2.06. The Multicurrency Tranche Swingline Exposure of any Multicurrency
Tranche Lender at any time shall be its Multicurrency Tranche Percentage of the
total Multicurrency Tranche Swingline Exposure at such time.

“Multiemployer Plan” means a multiemployer plan as defined in Section 4001(a)(3)
of ERISA.

“Net Income” means, for any period, the consolidated net income (or loss) of the
Company and its Subsidiaries, determined on a consolidated basis in accordance
with GAAP; provided that there shall be excluded (a) the income (or deficit) of
any Person accrued prior to the date it becomes a Subsidiary or is merged into
or consolidated with the Company or any of its Subsidiaries, (b) the income (or
deficit) of any Person (other than a Subsidiary) in which the Company or any of
its Subsidiaries has an

 

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ownership interest, except to the extent that any such income is actually
received by the Company or such Subsidiary in the form of dividends or similar
distributions and (c) the undistributed earnings of any Subsidiary to the extent
that the declaration or payment of dividends or similar distributions by such
Subsidiary is not at the time permitted by the terms of any contractual
obligation (other than under any Loan Document) or Requirement of Law applicable
to such Subsidiary.

“Net Orderly Liquidation Value” means, with respect to Inventory of any Person,
the orderly liquidation value thereof as determined in a manner acceptable to
the Co-Collateral Agents in their Permitted Discretion by an appraiser
reasonably acceptable to the Co-Collateral Agents, net of all costs of
liquidation thereof.

“Net Proceeds” means, with respect to any event, (a) the cash proceeds received
in respect of such event including (i) any cash received in respect of any
non-cash proceeds (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, but excluding any interest payments),
but only as and when received, (ii) in the case of a casualty, insurance
proceeds and (iii) in the case of a condemnation or similar event, condemnation
awards and similar payments, net of (b) the sum of (i) all reasonable fees and
out-of-pocket expenses paid to third parties (other than Affiliates) in
connection with such event, (ii) in the case of a sale, transfer or other
disposition of an asset (including pursuant to a sale and leaseback transaction
or a casualty or a condemnation or similar proceeding), the amount of all
payments required to be made as a result of such event to repay Indebtedness
(other than Loans) secured by such asset or otherwise subject to mandatory
prepayment as a result of such event and (iii) the amount of all taxes paid (or
reasonably estimated to be payable) and the amount of any reserves established
to fund contingent liabilities reasonably estimated to be payable, in each case
during the year that such event occurred or the next succeeding year and that
are directly attributable to such event (as determined reasonably and in good
faith by a Financial Officer).

“Non-Consenting Lender” has the meaning assigned to such term in
Section 9.02(d).

“Non-Paying Guarantor” has the meaning assigned to such term in Section 10.11.

“Non-U.S. Lender” means a Lender that is not a U.S. Person.

“Non-U.S. Pension Plan” means any plan, scheme, fund (including any
superannuation fund) or other similar program established, sponsored or
maintained outside the United States by the Company or any one or more of its
Subsidiaries primarily for the benefit of employees of the Company or such
Subsidiaries residing outside the United States, which plan, fund or other
similar program provides, or results in, retirement income, a deferral of income
in contemplation of retirement or payments to be made upon termination of
employment, and which plan is not subject to ERISA or the Code.

“Obligated Party” has the meaning assigned to such term in Section 10.02.

“Obligations” means all unpaid principal of and accrued and unpaid interest on
the Loans, all LC Exposure, all accrued and unpaid fees and all expenses,
reimbursements, indemnities and other obligations and indebtedness (including
interest accruing during the pendency of any bankruptcy, insolvency,
receivership or other similar proceeding, regardless of whether allowed or
allowable in such proceeding), obligations and liabilities of any of the Company
and its Subsidiaries to any of the Lenders, the Administrative Agent, any
Co-Collateral Agent, the Issuing Bank or any indemnified party, individually or
collectively, existing on the Effective Date or arising thereafter, direct or
indirect, joint or several, absolute or contingent, matured or unmatured,
liquidated or unliquidated, secured or unsecured, arising by contract, operation
of law or otherwise, arising or incurred under this Credit Agreement or any of
the other Loan Documents or in respect of any of the Loans made or reimbursement
or other obligations incurred or any of the Letters of Credit or other
instruments at any time evidencing any thereof.

 

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“Off-Balance Sheet Liability” of a Person means (a) any repurchase obligation or
liability of such Person with respect to accounts or notes receivable sold by
such Person, (b) any indebtedness, liability or obligation under any so-called
“synthetic lease” transaction entered into by such Person, or (c) any
indebtedness, liability or obligation arising with respect to any other
transaction which is the functional equivalent of or takes the place of
borrowing but which does not constitute a liability on the balance sheets of
such Person (other than operating leases).

“Orderly Liquidation Value” means, with respect to Trademarks of any Person, the
orderly liquidation value thereof as determined in a manner acceptable to the
Co-Collateral Agents in their Permitted Discretion by an appraiser reasonably
acceptable to the Co-Collateral Agents.

“Original Currency” has the meaning assigned to such term in Section 2.19(a).

“Original Effective Date” means June 9, 2010.

“Other Taxes” means any present or future stamp, court, documentary, intangible,
recording, filing or similar excise or property Taxes that arise from any
payment made under, from the execution, delivery, performance, enforcement or
registration of, or from the registration, receipt or perfection of a security
interest under, or otherwise with respect to, any Loan Document.

“Overnight LIBO” means, when used in reference to any Loan or Borrowing, whether
such Loan or the Loan comprising such Borrowing accrues interest at a rate
determined by reference to the Overnight LIBO Rate.

“Overnight LIBO Rate” means, with respect to any Overnight LIBO Borrowing or
overdue amount that bears interest at the Overnight LIBO Rate pursuant to the
terms of this Agreement, (a) the rate of interest per annum (rounded upwards, if
necessary, to the next 1/16 of 1%) at which overnight deposits in the applicable
Agreed Currency, in an amount approximately equal to the amount with respect to
which such rate is being determined, would be offered for such day by a branch
or Affiliate of the Administrative Agent in the London interbank market for such
currency to major banks in the London interbank market plus (b) the Mandatory
Cost.

“Overadvance” has the meaning assigned to such term in Section 2.06(c).

“Parent” means, with respect to any Lender, any person as to which such Lender
is, directly or indirectly, a subsidiary.

“Participant” has the meaning assigned to such term in Section 9.04(b).

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

“Participating Member State” means any member state of the European Community
that adopts or has adopted the euro as its lawful currency in accordance with
legislation of the European Community relating to economic and monetary union.

“Paying Guarantor” has the meaning assigned to such term in Section 10.11.

 

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“PBGC” means the Pension Benefit Guaranty Corporation referred to and defined in
ERISA and any successor entity performing similar functions.

“Pensions Regulator” means the body corporate called the “Pensions Regulator,”
established pursuant to Part I of the United Kingdom Pensions Act 2004.

“Permitted Acquisition” means (a) any acquisition of all or a significant
portion of the assets of, or more than 50% of the Equity Interests in, a Person
or division or line of business of a Person, to the extent the Required Lenders
give their prior written consent thereto and (b) any other acquisition (whether
by purchase, lease (other than a customary real estate lease), merger,
consolidation or otherwise, but excluding in any event a Hostile Acquisition) or
series of related acquisitions by the Company or any Subsidiary of (i) all or a
significant portion of the assets of or (ii) more than 50% of the Equity
Interests in, a Person or division or line of business of a Person, if, at the
time of and immediately after giving effect thereto, (A) either (x) the
aggregate consideration paid in respect of all Permitted Acquisitions pursuant
to this clause (b) during the fiscal year of the Company in which such
acquisition(s) occurs does not exceed $5,000,000 or (y) the Permitted
Acquisition Test is satisfied, (B) such Person or division or line of business
is engaged in the same or a similar line of business as the Company and the
Subsidiaries or business reasonably related thereto, (C) all actions required to
be taken with respect to such acquired or newly formed Subsidiary under Section
5.14 shall have been taken, and (D) in the case of an acquisition or merger
involving the Company or a Subsidiary, the Company or such Subsidiary is the
surviving entity of such merger and/or consolidation.

“Permitted Acquisition Test” means, with respect to any acquisition (whether by
purchase, lease (other than a customary real estate lease), merger,
consolidation or otherwise) or series of related acquisitions by the Company or
any Subsidiary, a test that is satisfied if each of the following conditions are
met: (a) no Default or Event of Default has occurred and is continuing prior to
giving effect to such acquisition(s) or would arise after giving effect
(including pro forma effect) thereto, (b) Availability exceeds $25,000,000 after
giving pro forma effect to such acquisition(s) for a period of three consecutive
months prior to such acquisition(s) and (c) the Fixed Charge Coverage Ratio, on
a pro forma basis after giving effect to such acquisition(s) (but without giving
effect to any synergies or cost savings), determined for the four consecutive
fiscal quarters ending on the last day of the most recently ended fiscal quarter
of the Company for which financial statements are available, as if such
acquisition(s) (and any related incurrence or repayment of Indebtedness, with
any new Indebtedness being deemed amortized over such testing period in
accordance with its terms) had occurred on the first day of such testing period,
is equal to or greater than 1.10 to 1.00.

“Permitted Discretion” means a determination made in good faith and in the
exercise of reasonable (from the perspective of a secured asset-based lender)
business judgment.

“Permitted Encumbrances” means:

(a) Liens imposed by law for Taxes that are not yet due or are being contested
in compliance with Section 5.04;

(b) carriers’, warehousemen’s, mechanics’, materialmen’s, repairmen’s and other
like Liens imposed by law, arising in the ordinary course of business and
securing obligations that are not overdue by more than thirty (30) days or are
being contested in compliance with Section 5.04;

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

 

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(d) deposits to secure the performance of bids, trade contracts, leases,
statutory obligations, surety and appeal bonds, performance bonds and other
obligations of a like nature, in each case in the ordinary course of business;

(e) judgment liens in respect of judgments that do not constitute an Event of
Default under clause (k) of Article VII; and

(f) easements, zoning restrictions, rights-of-way and similar encumbrances on
real property imposed by law or arising in the ordinary course of business that
do not secure any monetary obligations and do not materially detract from the
value of the affected property or interfere with the ordinary conduct of
business of the Company or any Subsidiary;

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

“Permitted Investments” means:

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

(b) investments in commercial paper maturing within 270 days from the date of
acquisition thereof and having, at such date of acquisition, the highest credit
rating obtainable from S&P or from Moody’s;

(c) investments in certificates of deposit, banker’s acceptances and time
deposits maturing within 180 days from the date of acquisition thereof issued or
guaranteed by or placed with, and money market deposit accounts issued or
offered by any Lender, or by any domestic office of any commercial bank
organized under the laws of the United States of America or any State thereof
which has a combined capital and surplus and undivided profits of not less than
$500,000,000;

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

(e) money market funds that (i) comply with the criteria set forth in Securities
and Exchange Commission 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 $5,000,000,000.

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

“Plan” means 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 or
Section 302 of ERISA, and in respect of which the Company 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.

“Pounds Sterling” means the lawful currency of the United Kingdom.

 

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“Prepayment Event” means:

(a) any sale, transfer or other disposition (including pursuant to a sale and
leaseback transaction) of any property or asset of any Loan Party, other than
dispositions described in Section 6.05(a), (b) or (g); or

(b) any casualty or other insured damage to, or any taking under power of
eminent domain or by condemnation or similar proceeding of, any property or
asset of any Loan Party with a fair value immediately prior to such event equal
to or greater than $5,000,000; or

(c) the issuance by the Company of any Equity Interests, or the receipt by the
Company of any capital contribution; or

(d) the incurrence by any Loan Party of any Indebtedness, other than
Indebtedness permitted under Section 6.01 or permitted by the Required Lenders
pursuant to Section 9.02.

“Prime Rate” means the rate of interest per annum publicly announced from time
to time by Chase as its prime rate at its offices at 270 Park Avenue in New York
City; each change in the Prime Rate shall be effective from and including the
date such change is publicly announced as being effective.

“Projections” has the meaning assigned to such term in Section 5.01(f).

“Protected Party” means any Credit Party that is or will be subject to any
liability or required to make any payment for or on account of U.K. Tax, in
relation to a sum received or receivable (or any sum deemed for the purposes of
U.K. Tax to be received or receivable) under any Loan Document.

“Protective Advances” means, collectively, Dollar Tranche Protective Advances
and Multicurrency Tranche Protective Advances.

“Qualifying Lender” means:

(i) a Lender (other than a Lender within clause (ii) below) that is beneficially
entitled to interest payable to that Lender in respect of an advance under a
Loan Document and is:

 

  (a) a Lender:

 

  (1) which is a bank (as defined for the purpose of Section 879 of the ITA)
making an advance under a Loan Document; or

 

  (2) in respect of an advance made under a Loan Document by a person that was a
bank (as defined for the purpose of Section 879 of the ITA) at the time that
that advance was made,

and which is within the charge to United Kingdom corporation tax as respects any
payments of interest made in respect of that advance; or

 

  (b) a Lender which is:

 

  (1) a company resident in the United Kingdom for United Kingdom tax purposes;
or

 

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  (2) a partnership each member of which is:

 

  (x) a company so resident in the United Kingdom; or

 

  (y) a company not so resident in the United Kingdom which carries on a trade
in the United Kingdom through a permanent establishment and which brings into
account in computing its chargeable profits (for the purposes of Section 19 of
the Corporation Tax Act 2009) the whole of any share of interest payable in
respect of that advance that falls to it by reason of Part 17 of the Corporation
Tax Act 2009; or

 

  (3) a company not so resident in the United Kingdom which carries on a trade
in the United Kingdom through a permanent establishment and which brings into
account interest payable in respect of that advance in computing its chargeable
profits (within the meaning given by Section 19 of the Corporation Tax Act
2009); or

 

  (c) a Treaty Lender; or

(ii) a building society (as defined for the purpose of Section 880 of the ITA)
making an advance under a Loan Document.

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

“Register” has the meaning set forth in Section 9.04.

“Regulation” means the Council of the European Union Regulations No. 1346/2000
on Insolvency Proceedings.

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

“Rent Reserve” with respect to any store, warehouse distribution center,
regional distribution center or depot where any Inventory subject to Liens
arising by operation of law is located, a reserve equal to two (2) months’ rent
(in relation to Inventory of the Domestic Loan Parties) and three (3) months’
rent (in relation to Inventory of the Foreign Loan Parties) at such store,
warehouse distribution center, regional distribution center or depot.

“Report” means reports prepared by the Administrative Agent, the Co-Collateral
Agents or another Person showing the results of appraisals, field examinations
or audits pertaining to the Loan Parties’ assets from information furnished by
or on behalf of the Borrowers, after the Administrative Agent or the
Co-Collateral Agents, as applicable, have exercised their rights of inspection
pursuant to this Agreement, which Reports may be distributed to the Lenders by
the Administrative Agent or the Co- Collateral Agents.

“Required Lenders” means, at any time, Lenders having Credit Exposures and
unused Commitments representing more than 50% of the sum of the Aggregate Credit
Exposure and unused Commitments at such time.

“Requirement of Law” means, as to any Person, the Certificate of Incorporation
and By Laws or other organizational or governing documents of such Person, and
any law, treaty, rule or regulation or determination of an arbitrator or a court
or other Governmental Authority, in each case applicable to or binding upon such
Person or any of its property or to which such Person or any of its property is
subject.

 

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“Reserves” means any and all reserves which the Co-Collateral Agents deem
necessary, in their Permitted Discretion, to maintain (including, without
limitation, reserves for accrued and unpaid interest on the Secured Obligations,
Banking Services Reserves, Rent Reserves, Second Lien Obligations Reserves, U.K.
Priority Payable Reserves, reserves for rent at locations leased by any Loan
Party and for consignee’s, warehousemen’s and bailee’s charges, reserves for
dilution of Accounts, reserves for customs charges and shipping charges related
to any Inventory in transit, reserves for Swap Obligations, reserves for
contingent liabilities of any Loan Party, reserves for uninsured losses of any
Loan Party, reserves for uninsured, underinsured, unindemnified or
underindemnified liabilities or potential liabilities with respect to any
litigation, reserves for extended or extendable retention of title over Accounts
and reserves for taxes, fees, assessments, and other governmental charges) with
respect to the Collateral or any Loan Party.

“Restricted Payment” means any dividend or other distribution (whether in cash,
securities or other property) with respect to any Equity Interests in the
Company or any Subsidiary, or any payment (whether in cash, securities or other
property), including any sinking fund or similar deposit, on account of the
purchase, redemption, retirement, acquisition, cancellation or termination of
any such Equity Interests in the Company or any Subsidiary or any option,
warrant or other right to acquire any such Equity Interests in the Company or
any Subsidiary.

“Revolving Exposure” means, with respect to any Lender at any time, the sum of
(a) the Dollar Amount of the outstanding principal amount of such Lender’s
Dollar Tranche Revolving Loans, Multicurrency Tranche Revolving Loans and its LC
Exposure, plus (b) an amount equal to its Applicable Percentage of the Dollar
Amount of the aggregate principal amount of Swingline Loans at such time that
such Lender has purchased a participation in pursuant to Section 2.06, plus
(c) an amount equal to its Applicable Percentage of the Dollar Amount of the
aggregate principal amount of Overadvances outstanding at such time that such
Lender has purchased a participation in pursuant to Section 2.06.

“Revolving Exposure Limitations” has the meaning set forth in Section 2.01.

“Revolving Loan” means a Loan made pursuant to Section 2.01.

“S&P” means Standard & Poor’s Ratings Services, a Standard & Poor’s Financial
Services LLC business.

“Second Lien Documents” means, collectively, that certain Second Lien Credit
Agreement, dated as of the Original Effective Date, by and among the Company,
the Loan Parties party thereto as subsidiary guarantors, the lenders from time
to time party thereto and Citibank, N.A., as administrative agent and collateral
agent, and all other agreements, instruments, documents and certificates
executed and/or delivered in connection therewith.

“Second Lien Obligations” means the Indebtedness and other obligations of the
Company and its Subsidiaries under the Second Lien Documents.

“Second Lien Obligations Reserve” means, as of any date, a Reserve equal to the
“Secured Obligations” as defined in, and then outstanding under, the Second Lien
Documents.

 

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“Secured Obligations” means all Obligations, together with all (i) Banking
Services Obligations and (ii) Swap Obligations owing to one or more Secured
Parties or their respective Affiliates; provided that within at least ten
(10) calendar days from the date that any transaction relating to any such
Banking Services Obligation or Swap Obligation is executed, the Secured Party
party thereto (other than Chase) shall have delivered written notice to the
Administrative Agent that such a transaction has been entered into and that it
constitutes a Secured Obligation entitled to the benefits of the Collateral
Documents.

“Secured Parties” means the holders of the Secured Obligations from time to time
and shall include (i) each Lender and the Issuing Bank in respect of its Loans
and LC Exposure respectively, (ii) the Administrative Agent, the Co-Collateral
Agents, the Issuing Bank and the Lenders in respect of all other present and
future obligations and liabilities of the Company and each Subsidiary of every
type and description arising under or in connection with this Agreement or any
other Loan Document, (iii) each Lender and Affiliate of such Lender in respect
of Swap Obligations and Banking Services Obligations owed to such Person by the
Company or any Subsidiary, (iv) each indemnified party under Section 9.03 in
respect of the obligations and liabilities of the Company or any Subsidiary to
such Person hereunder and under the other Loan Documents, and (v) their
respective successors and (in the case of a Lender, permitted) transferees and
assigns.

“Security Agreement” means the Domestic Security Agreement or any Foreign
Security Agreement.

“Settlement” has the meaning assigned to such term in Section 2.06(e).

“Settlement Date” has the meaning assigned to such term in Section 2.06(e).

“Specified Assets” means the Equity Interests in LTB de Mexico, S.A. de C.V.

“Standby LC Exposure” means, at any time, the sum of (a) the aggregate undrawn
Dollar Amount of all outstanding standby Letters of Credit at such time plus
(b) the aggregate Dollar Amount of all LC Disbursements relating to standby
Letters of Credit that have not yet been reimbursed by or on behalf of the
Borrowers at such time.

“Statutory Reserve Rate” means a fraction (expressed as a decimal), the
numerator of which is the number one and the denominator of which is the number
one minus the aggregate of the maximum reserve, liquid asset, fees or similar
requirements (including any marginal, special, emergency or supplemental
reserves or other requirements) established by any central bank, monetary
authority, the Board, the Financial Services Authority, the European Central
Bank or other Governmental Authority for any category of deposits or liabilities
customarily used to fund loans in the applicable currency, expressed in the case
of each such requirement as a decimal. Such reserve, liquid asset, fees or
similar requirements shall, in the case of Dollar denominated Loans, include
those imposed pursuant to Regulation D of the Board. Eurocurrency Loans shall be
deemed to be subject to such reserve, liquid asset, fee or similar requirements
without benefit of or credit for proration, exemptions or offsets that may be
available from time to time to any Lender under any applicable law, rule or
regulation, including Regulation D of the Board. The Statutory Reserve Rate
shall be adjusted automatically on and as of the effective date of any change in
any reserve, liquid asset or similar requirement.

“Subordinated Indebtedness” of a Person means any Indebtedness of such Person
the payment of which is subordinated to payment of the Secured Obligations.

 

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“subsidiary” means, with respect to any Person (the “parent”) at any date, any
corporation, limited liability company, partnership, association or other entity
the accounts of which would be consolidated with those of the parent in the
parent’s consolidated financial statements if such financial statements were
prepared in accordance with GAAP as of such date, as well as any other
corporation, limited liability company, partnership, association or other 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, in the case of a
partnership, more than 50% of the general partnership interests are, as of such
date, owned, Controlled or held, or (b) that is, as of such date, otherwise
Controlled, by the parent or one or more subsidiaries of the parent or by the
parent and one or more subsidiaries of the parent.

“Subsidiary” means any direct or indirect subsidiary of the Company or a Loan
Party, as applicable.

“Supply Recipient” has the meaning assigned to such term in Section 2.18A(s).

“Swap Agreement” means 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 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 Company or the
Subsidiaries shall be a Swap Agreement.

“Swap Obligations” of a Person means any and all obligations (after giving
effect to any netting agreements) of such Person, whether absolute or contingent
and howsoever and whensoever created, arising, evidenced or acquired (including
all renewals, extensions and modifications thereof and substitutions therefor),
under (a) any and all Swap Agreements permitted hereunder with a Lender or an
Affiliate of a Lender, and (b) any and all cancellations, buy backs, reversals,
terminations or assignments of any such Swap Agreement transaction.

“Swingline Exposure” means, at any time, the aggregate principal amount of all
outstanding Swingline Loans at such time. The Swingline Exposure of any Lender
at any time shall be its Applicable Percentage of the total Swingline Exposure
at such time.

“Swingline Lender” means JPMorgan Chase Bank, N.A. (including its branches and
affiliates), in its capacity as lender of Swingline Loans hereunder.

“Swingline Loans” means, collectively, Dollar Swingline Loans and Multicurrency
Swingline Loans.

“Syndication Agent” means HSBC Bank USA, National Association, in its capacity
as syndication agent for the credit facility evidenced by this Agreement.

“TARGET2” means the Trans-European Automated Real-time Gross Settlement Express
Transfer (TARGET2) payment system (or, if such payment system ceases to be
operative, such other payment system (if any) reasonably determined by the
Administrative Agent to be a suitable replacement) for the settlement of
payments in euro.

“Tax Credit” means a credit against, relief of remission for or repayment of any
U.K. Tax.

 

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“Tax Deduction” means a deduction or withholding for or on account of U.K. Tax
from a payment under any Loan Document.

“Tax Payment” means either an increased payment made by a Borrower to a Lender
under Section 2.18A(d) or a payment under Section 2.18A(k).

“Taxes” means any present or future taxes, levies, imposts, duties, deductions,
withholdings, assessments, fees or other charges imposed by any Governmental
Authority, including any interest, additions to tax or penalties applicable
thereto but excluding U.K. Tax.

“Trademarks” has the meaning assigned to such term in the Domestic Security
Agreement.

“Tranche” means a category of Commitments and extensions of credit thereunder.
For purposes hereof, each of the following comprises a separate Tranche:
(a) Multicurrency Tranche Commitments, Multicurrency Tranche Revolving Loans,
Multicurrency Tranche Letters of Credit, and any Swingline Loans, Overadvances
and Protective Advances made under the Multicurrency Tranche Commitments and
(b) Dollar Tranche Commitments, Dollar Tranche Revolving Loans, Dollar Tranche
Letters of Credit and any Swingline Loans, Overadvances and Protective Advances
made under the Dollar Tranche Commitments.

“Transactions” means the execution, delivery and performance by the Loan Parties
of this Agreement and the other Loan Documents, the borrowing of Loans and other
credit extensions, the use of the proceeds thereof and the issuance of Letters
of Credit hereunder.

“Treaty Lender” means a Lender which:

(i) is treated as a resident of a Treaty State for the purposes of a Treaty; and

(ii) does not carry on a business in the United Kingdom through a permanent
establishment with which that Lender’s participation in the Loan is effectively
connected.

“Treaty State” means a jurisdiction having a double taxation agreement (a
“Treaty”) with the United Kingdom which makes provision for full exemption from
tax imposed by the United Kingdom on interest.

“Type”, when used in reference to any Loan or Borrowing, refers to whether the
rate of interest on such Loan, or on the Loans comprising such Borrowing, is
determined by reference to the Adjusted LIBO Rate, the Overnight LIBO Rate or
the Alternate Base Rate.

“UCC” means the Uniform Commercial Code as in effect from time to time in the
State of New York or any other state the laws of which are required to be
applied in connection with the issue of perfection of security interests.

“U.K. Insolvency Event” means:

(a) a U.K. Relevant Entity is unable or admits inability to pay its debts as
they fall due or is deemed to or declared to be unable to pay its debts under
applicable law, suspends or threatens to suspend making payments on any of its
debts or, by reason of actual or anticipated financial difficulties, commences
negotiations with one or more of its creditors with a view to rescheduling any
of its indebtedness;

 

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(b) the value of the assets of any U.K. Relevant Entity (on a consolidated basis
with its subsidiaries), is less than its liabilities (taking into account
contingent and prospective liabilities);

(c) a moratorium is declared in respect of any indebtedness of any U.K. Relevant
Entity; provided that, if a moratorium occurs, the ending of the moratorium will
not remedy any Event of Default caused by such moratorium;

(d) any corporate action, legal proceedings or other procedure or step is taken
in relation to:

(i) the suspension of payments, a moratorium of any indebtedness, winding-up,
dissolution, administration or reorganization (by way of voluntary arrangement,
scheme of arrangement or otherwise) of any U.K. Relevant Entity;

(ii) a composition, compromise, assignment or arrangement with any creditor of
any U.K. Relevant Entity;

(iii) the appointment of a liquidator, receiver, administrative receiver,
administrator, compulsory manager or other similar officer in respect of any
U.K. Relevant Entity, or any of its assets; or

(iv) enforcement of any Lien over any material assets of any U.K. Relevant
Entity,

or any analogous procedure or step is taken in any jurisdiction, save that this
paragraph (d) shall not apply to any winding-up petition which is frivolous or
vexatious and is discharged, stayed or dismissed within 14 days of notice
thereof to any U.K. Relevant Entity or any U.K. Relevant Entity otherwise
becoming aware of the same; or

(e) any expropriation, attachment, sequestration, distress or execution or any
analogous process in any jurisdiction affects any asset or assets of a U.K.
Relevant Entity, in each such case, such that any such actions or process
described in this clause (e) could reasonably be expected to result in a
Material Adverse Effect.

“U.K. Loan Party” means each Loan Party that is organized under the laws of
England and Wales.

“U.K. Priority Payable Reserves” means, collectively, Reserves for the
prescribed part of each U.K. Loan Party’s net property that would be made
available for the satisfaction of its unsecured liabilities pursuant to §176A of
the United Kingdom Insolvency Act 1986, as amended, and Reserves with respect to
liabilities of each U.K. Loan Party which constitute preferential debts pursuant
to §386 of the United Kingdom Insolvency Act 1986, as amended.

“U.K. Relevant Entity” means any U.K. Loan Party or any Loan Party capable of
becoming subject of an order for winding-up or administration under the
Insolvency Act 1986 of the United Kingdom.

“U.K. Tax” means any tax, levy, impost, duty or other charge or withholding of a
similar nature (including any penalty or interest payable in connection with any
failure to pay or any delay in paying any of the same) imposed by the government
of the United Kingdom or any political subdivision thereof.

 

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“Unliquidated Obligations” means, at any time, any Secured Obligations (or
portion thereof) that are contingent in nature or unliquidated at such time,
including any Secured Obligation that is: (i) an obligation to reimburse a bank
for drawings not yet made under a letter of credit issued by it; (ii) any other
obligation (including any guarantee) that is contingent in nature at such time;
or (iii) an obligation to provide collateral to secure any of the foregoing
types of obligations.

“U.S. Person” means a “United States person” within the meaning of
Section 7701(a)(30) of the Code.

“VAT” means value added tax as provided for in the United Kingdom Value Added
Tax Act 1994 and any other U.K. Tax of a similar nature.

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

“Withholding Agent” means any Loan Party and the Administrative Agent.

SECTION 1.02. Classification of Loans and Borrowings. For purposes of this
Agreement, Loans may be classified and referred to by Class (e.g., a “Revolving
Loan”) or by Type (e.g., a “Eurocurrency Loan”) or by Class and Type (e.g., a
“Eurocurrency Revolving Loan”). Borrowings also may be classified and referred
to by Class (e.g., a “Revolving Borrowing”) or by Type (e.g., a “Eurocurrency
Borrowing”) or by Class and Type (e.g., a “Eurocurrency Revolving Borrowing”).

SECTION 1.03. Terms Generally. The definitions of terms herein shall apply
equally to the singular and plural forms of the terms defined. Whenever the
context may require, any pronoun shall include the corresponding masculine,
feminine and neuter forms. The words “include”, “includes” and “including” shall
be deemed to be followed by the phrase “without limitation”. The word “will”
shall be construed to have the same meaning and effect as the word “shall”. The
word “law” shall be construed as referring to all statutes, rules, regulations,
codes and other laws (including official rulings and interpretations thereunder
having the force of law or with which affected Persons customarily comply), and
all judgments, orders and decrees, of all Governmental Authorities. Unless the
context requires otherwise (a) any definition of or reference to any agreement,
instrument or other document herein shall be construed as referring to such
agreement, instrument or other document as from time to time amended, restated,
supplemented or otherwise modified (subject to any restrictions on such
amendments, restatements, supplements or modifications set forth herein),
(b) any definition of or reference to any statute, rule or regulation shall be
construed as referring thereto as from time to time amended, supplemented or
otherwise modified (including by succession of comparable successor laws),
(c) any reference herein to any Person shall be construed to include such
Person’s successors and assigns (subject to any restrictions on assignment set
forth herein) and, in the case of any Governmental Authority, any other
Governmental Authority that shall have succeeded to any or all functions
thereof, (d) the words “herein”, “hereof” and “hereunder”, and words of similar
import, shall be construed to refer to this Agreement in its entirety and not to
any particular provision hereof, (e) all references herein to Articles,
Sections, Exhibits and Schedules shall be construed to refer to Articles and
Sections of, and Exhibits and Schedules to, this Agreement and (f) the words
“asset” and “property” shall be construed to have the same meaning and effect
and to refer to any and all tangible and intangible assets and properties,
including cash, securities, accounts and contract rights.

SECTION 1.04. Accounting Terms; GAAP. 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; provided that, if the
Company notifies the Administrative Agent that the

 

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Company requests an amendment to any provision hereof to eliminate the effect of
any change occurring after the date hereof in GAAP or in the application thereof
on the operation of such provision (or if the Administrative Agent notifies the
Company that the Required Lenders request an amendment to any provision hereof
for such purpose), regardless of whether any such notice is given before or
after such change in GAAP or in the application thereof, then such provision
shall be interpreted on the basis of GAAP as in effect and applied immediately
before such change shall have become effective until such notice shall have been
withdrawn or such provision amended in accordance herewith. Notwithstanding any
other provision contained herein, all terms of an accounting or financial nature
used herein shall be construed, and all computations of amounts and ratios
referred to herein shall be made (i) without giving effect to any election under
Accounting Standards Codification 825-10-25 (or any other Accounting Standards
Codification or Financial Accounting Standard having a similar result or effect)
to value any Indebtedness or other liabilities of the Company or any Subsidiary
at “fair value”, as defined therein and (ii) without giving effect to any
treatment of Indebtedness in respect of convertible debt instruments under
Accounting Standards Codification 470-20 (or any other Accounting Standards
Codification or Financial Accounting Standard having a similar result or effect)
to value any such Indebtedness in a reduced or bifurcated manner as described
therein, and such Indebtedness shall at all times be valued at the full stated
principal amount thereof.

SECTION 1.05. Status of Obligations. In the event that the Company or any other
Loan Party shall at any time issue or have outstanding any Subordinated
Indebtedness, the Company shall take or cause such other Loan Party to take all
such actions as shall be necessary to cause the Secured Obligations to
constitute senior indebtedness (however denominated) in respect of such
Subordinated Indebtedness and to enable the Administrative Agent and the Lenders
to have and exercise any payment blockage or other remedies available or
potentially available to holders of senior indebtedness under the terms of such
Subordinated Indebtedness. Without limiting the foregoing, the Secured
Obligations are hereby designated as “senior indebtedness” and as “designated
senior indebtedness” and words of similar import under and in respect of any
indenture or other agreement or instrument under which such other Subordinated
Indebtedness is outstanding and are further given all such other designations as
shall be required under the terms of any such Subordinated Indebtedness in order
that the Lenders may have and exercise any payment blockage or other remedies
available or potentially available to holders of senior indebtedness under the
terms of such Subordinated Indebtedness.

SECTION 1.06. Amendment and Restatement of the Existing Credit Agreement. The
parties to this Agreement agree that, on the Effective Date, the terms and
provisions of the Existing Credit Agreement shall be and hereby are amended,
superseded and restated in their entirety by the terms and provisions of this
Agreement. This Agreement is not intended to and shall not constitute a
novation. All loans made and obligations incurred under the Existing Credit
Agreement which are outstanding on the Effective Date shall continue as Loans
and Secured Obligations under (and shall be governed by the terms of) this
Agreement and the other Loan Documents. Without limiting the foregoing, upon the
effectiveness hereof: (a) all references in the “Loan Documents” (as defined in
the Existing Credit Agreement) to the “Administrative Agent,” the “Credit
Agreement” and the “Loan Documents” shall be deemed to refer to the
Administrative Agent, this Agreement and the Loan Documents, (b) Letters of
Credit which remain outstanding on the Effective Date shall continue as Letters
of Credit under (and shall be governed by the terms of) this Agreement, (c) all
obligations constituting “Obligations” with any Lender or any Affiliate of any
Lender which are outstanding on the Effective Date shall continue as Obligations
under this Agreement and the other Loan Documents, and (d) the liens and
security interests in favor of the Administrative Agent for the benefit of the
Secured Parties securing payment of the Secured Obligations are in all respects
continuing and in full force and effect with respect to all Secured Obligations.

 

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ARTICLE II

The Credits

SECTION 2.01. Commitments. Subject to the terms and conditions set forth herein,
(a) each Dollar Tranche Lender agrees to make Dollar Tranche Revolving Loans
from time to time during the Availability Period to the Company and the Foreign
Subsidiary Borrowers in Dollars, and (b) each Multicurrency Tranche Lender
agrees to make Multicurrency Tranche Revolving Loans from time to time during
the Availability Period to the Company and the Foreign Subsidiary Borrowers in
Agreed Currencies, if, in each case, after giving effect thereto:

(i) the Dollar Tranche Revolving Exposure of each Dollar Tranche Lender would
not exceed such Dollar Tranche Lender’s Dollar Tranche Commitment;

(ii) the Multicurrency Revolving Exposure of each Multicurrency Tranche Lender
would not exceed such Multicurrency Tranche Lender’s Multicurrency Tranche
Commitment;

(iii) the aggregate Company Revolving Exposures of all Lenders would not exceed
an amount equal to (x) the Domestic Borrowing Base minus (y) the Foreign
Borrowers Utilization; and

(iv) the aggregate Foreign Borrowers Revolving Exposures of all Lenders would
not exceed an amount equal to (x) the sum of the Domestic Borrowing Base plus
the Foreign Borrowing Base minus (y) the aggregate Company Revolving Exposures
of all Lenders;

subject, in each case, to the Administrative Agent’s authority, in its sole
discretion, to make Protective Advances and Overadvances pursuant to the terms
of Sections 2.05 and 2.06. Within the foregoing limits and subject to the terms
and conditions set forth herein, the Borrowers may borrow, prepay and reborrow
Revolving Loans. The limitations on Borrowings referred to in clauses
(i) through (iv) above are referred to collectively as the “Revolving Exposure
Limitations”.

SECTION 2.02. Loans and Borrowings. (a) Each Loan (other than a Swingline Loan)
shall be made as part of a Borrowing consisting of Loans of the same Class and
Type made by the Lenders ratably in accordance with their respective Commitments
of the applicable Class. Any Protective Advance, any Overadvance and any
Swingline Loan shall be made in accordance with the procedures set forth in
Section 2.05 and 2.06.

(b) Subject to Section 2.15, each Revolving Borrowing shall be comprised
entirely of ABR Loans or Eurocurrency Loans, as the relevant Borrower may
request in accordance herewith; provided that, each ABR Loan shall only be made
in Dollars to the Company pursuant to the Dollar Tranche Commitments. Each
Dollar Swingline Loan made on behalf of the Dollar Tranche Lenders shall be an
ABR Loan and each Multicurrency Swingline Loan shall be an Overnight LIBO Loan.
Each Lender at its option may make any 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 relevant Borrower to repay
such Loan in accordance with the terms of this Agreement.

(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 $500,000 (or, if such Borrowing is denominated in a Foreign
Currency, 500,000 units of such currency) and not less than $2,000,000 (or, if
such Borrowing is denominated in a Foreign Currency, 2,000,000 units of

 

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such currency, unless such currency is Pounds Sterling, in which case the
minimum amount shall be 500,000 units). ABR Revolving Borrowings may be in any
amount. Borrowings of more than one Type and Class may be outstanding at the
same time; provided that there shall not at any time be more than a total of ten
(10) Eurocurrency Borrowings outstanding.

(d) Notwithstanding any other provision of this Agreement, the Borrowers 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 Maturity
Date.

SECTION 2.03. Requests for Revolving Borrowings. To request a Revolving
Borrowing, the applicable Borrower, or the Borrower Representative on behalf of
the applicable Borrower, shall notify the Administrative Agent of such request
(a) (i) in the case of a Eurocurrency Borrowing denominated in Dollars, by
telephone or by irrevocable written notice (via a written Borrowing Request in a
form approved by the Administrative Agent and signed by the applicable Borrower,
or the Borrower Representative on behalf of the applicable Borrower) not later
than 11:00 a.m., Local Time, three (3) Business Days before the date of the
proposed Borrowing and (ii) in the case of a Eurocurrency Borrowing denominated
in a Foreign Currency, by irrevocable written notice (via a written Borrowing
Request in a form approved by the Administrative Agent and signed by the
applicable Borrower, or the Borrower Representative on behalf of the applicable
Borrower), not later than 11:00 a.m., Local Time, four (4) Business Days before
the date of the proposed Borrowing or (b) in the case of an ABR Borrowing, by
telephone or written notice not later than 1:00 p.m., New York City time, on the
date of the proposed Borrowing; provided that any such notice of an ABR
Revolving Borrowing to finance the reimbursement of an LC Disbursement as
contemplated by Section 2.07(e) may be given not later than 10:00 a.m., New York
City time, on the date of the proposed Borrowing. Each such Borrowing Request
shall be irrevocable and, in the case of a telephonic Borrowing Request, shall
be confirmed promptly by hand delivery or facsimile to the Administrative Agent
of a written Borrowing Request in a form approved by the Administrative Agent
and signed by the applicable Borrower, or the Borrower Representative on behalf
of the applicable Borrower. Each such telephonic or written Borrowing Request
shall specify the following information:

(i) the aggregate amount of the requested Borrowing and the applicable Borrower;

(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; and

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

If no election as to the Type of Revolving Borrowing is specified, then, in the
case of a Borrowing denominated in Dollars to the Company, the requested
Revolving Borrowing shall be an ABR Borrowing. If no Interest Period is
specified with respect to any requested Eurocurrency Revolving Borrowing, then
the relevant 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, 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. Determination of Dollar Amounts. The Administrative Agent will
determine the Dollar Amount of:

(a) each Eurocurrency Borrowing as of the date two (2) Business Days prior to
the date of such Borrowing or, if applicable, the date of
conversion/continuation of any Borrowing as a Eurocurrency Borrowing;

(b) the LC Exposure as of the date of each request for the issuance, amendment,
renewal or extension of any Letter of Credit; and

(c) all outstanding Credit Events on and as of the last Business Day of each
calendar quarter and, during the continuation of an Event of Default, on any
other Business Day elected by the Administrative Agent in its discretion or upon
instruction by the Required Lenders.

Each day upon or as of which the Administrative Agent determines Dollar Amounts
described in the preceding clauses (a), (b) and (c) is herein described as a
“Computation Date” with respect to each Credit Event for which a Dollar Amount
is determined on or as of such day.

SECTION 2.05. Protective Advances. (a) Subject to the limitations set forth
below, the Administrative Agent is authorized by the Borrowers and the Lenders,
from time to time in the Administrative Agent’s sole discretion (but shall have
absolutely no obligation to), to make (i) Loans in Dollars to the Company or any
Foreign Subsidiary Borrower on behalf of the Dollar Tranche Lenders (each such
Loan, a “Dollar Tranche Protective Advance”) or (ii) Loans in any Agreed
Currency to the Company or any Foreign Subsidiary Borrower on behalf of the
Multicurrency Tranche Lenders (each such Loan, a “Multicurrency Tranche
Protective Advance”), which the Administrative Agent, in its Permitted
Discretion, deems necessary or desirable (i) to preserve or protect the
Collateral, or any portion thereof, (ii) to enhance the likelihood of, or
maximize the amount of, repayment of the Loans and other Obligations, or
(iii) to pay any other amount chargeable to or required to be paid by the
applicable Borrower pursuant to the terms of this Agreement, including payments
of reimbursable expenses (including costs, fees, and expenses as described in
Section 9.03) and other sums payable under the Loan Documents; provided that,
(A) the sum of the aggregate amount of Dollar Tranche Protective Advances
outstanding at any time plus the aggregate Dollar Tranche Revolving Exposures of
all Lenders shall not at any time exceed the aggregate Dollar Tranche
Commitments of all Dollar Tranche Lenders, and (B) the sum of the Dollar Amount
of the aggregate amount of Multicurrency Tranche Protective Advances outstanding
at any time plus the Dollar Amount of the aggregate Multicurrency Tranche
Revolving Exposures of all Lenders shall not at any time exceed the aggregate
Multicurrency Tranche Commitments of all Multicurrency Tranche Lenders.
Protective Advances may be made even if the conditions precedent set forth in
Section 4.02 have not been satisfied. The Protective Advances shall be secured
by the Liens in favor of the Administrative Agent in and to the Collateral and
shall constitute Obligations hereunder. All Protective Advances made to the
Company in Dollars shall be ABR Borrowings and all Protective Advances made to
the Company in any Foreign Currency or to any Foreign Subsidiary Borrower in any
Agreed Currency shall be Overnight LIBO Borrowings. The Administrative Agent’s
authorization to make Protective Advances may be revoked at any time by 100% of
the Lenders. Any such revocation must be in writing and shall become effective
prospectively upon the Administrative Agent’s receipt thereof. At any time that
there is sufficient Availability, and the conditions precedent set forth in
Section 4.02 have been satisfied, the Administrative Agent may request the
Lenders to make a Revolving Loan to repay a Protective Advance. At any other
time the Administrative Agent may require the Lenders to fund their risk
participations described in Section 2.05(b).

(b) Upon the making of a Protective Advance by the Administrative Agent (whether
before or after the occurrence of a Default), each Dollar Tranche Lender or
Multicurrency Tranche Lender, as applicable, shall be deemed, without further
action by any party hereto, to have unconditionally and irrevocably purchased
from the Administrative Agent without recourse or warranty, an undivided
interest and participation in such Protective Advance in proportion to its

 

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Applicable Percentage. From and after the date, if any, on which any Lender is
required to fund its participation in any Protective Advance purchased
hereunder, the Administrative Agent shall promptly distribute to such Lender,
such Lender’s Applicable Percentage of all payments of principal and interest
and all proceeds of Collateral received by the Administrative Agent in respect
of such Protective Advance.

SECTION 2.06. Swingline Loans and Overadvances.

(a) The Administrative Agent, the Swingline Lender and the Lenders agree that in
order to facilitate the administration of this Agreement and the other Loan
Documents, promptly after the Company requests an ABR Borrowing in Dollars from
the Dollar Tranche Lenders, the Swingline Lender may elect to have the terms of
this Section 2.06(a) apply to such Borrowing Request by advancing, on behalf of
the Dollar Tranche Lenders and in the amount requested, same day funds to the
Company on the applicable Borrowing date to the applicable Funding Account (each
such Loan made solely by the Swingline Lender pursuant to this Section 2.06(a)
is referred to in this Agreement as a “Dollar Swingline Loan”), with settlement
among them as to the Swingline Loans to take place on a periodic basis as set
forth in Section 2.06(e). Each Dollar Swingline Loan shall be subject to all the
terms and conditions applicable to other ABR Loans funded by the Dollar Tranche
Lenders, except that all payments thereon shall be payable to the Swingline
Lender solely for its own account. In addition, the Company hereby authorizes
the Swingline Lender to, and the Swingline Lender shall, subject to the terms
and conditions set forth herein (but without any further written notice
required), not later than 2:00 p.m., New York City time, on each Business Day,
make available to the Company by means of a credit to the applicable Funding
Account, the proceeds of a Dollar Swingline Loan to the extent necessary to pay
items to be drawn on any Controlled Disbursement Account that day (as determined
based on notice from the Administrative Agent). The Dollar Amount of the
aggregate amount of Dollar Swingline Loans and Multicurrency Swingline Loans
outstanding at any time shall not exceed $15,000,000. The Swingline Lender shall
not make any Dollar Swingline Loan if, after giving effect thereto, the
Borrowers would not be in compliance with the Revolving Exposure Limitations.
All Dollar Swingline Loans shall be ABR Borrowings.

(b) The Administrative Agent, the Swingline Lender and the Lenders agree that in
order to facilitate the administration of this Agreement and the other Loan
Documents, promptly after the Company or any Foreign Subsidiary Borrower
requests a Eurocurrency Borrowing in any Agreed Currency from the Dollar Tranche
Lenders or the Multicurrency Tranche Lenders, the Swingline Lender may elect to
have the terms of this Section 2.06(b) apply to such Borrowing Request by
advancing, on behalf of the Dollar Tranche Lenders or the Multicurrency Tranche
Lenders, as applicable, and in the amount and Agreed Currency requested, same
day funds to such Borrower on the applicable Borrowing date to the applicable
Funding Account (each such Loan made solely by the Swingline Lender pursuant to
this Section 2.06(b) is referred to in this Agreement as a “Multicurrency
Swingline Loan”), with settlement among them as to the Swingline Loans to take
place on a periodic basis as set forth in Section 2.06(e). Each Multicurrency
Swingline Loan shall be subject to all the terms and conditions applicable to
other Eurocurrency Loans funded by the Dollar Tranche Lenders or the
Multicurrency Tranche Lenders, as applicable, except that all payments thereon
shall be payable to the Swingline Lender solely for its own account and interest
shall accrue thereon at the rate applicable to Overnight LIBO Loans. The Dollar
Amount of the aggregate amount of Dollar Swingline Loans and Multicurrency
Swingline Loans outstanding at any time shall not exceed $15,000,000. The
Swingline Lender shall not make any Multicurrency Swingline Loan if, after
giving effect thereto, the Borrowers would not be in compliance with the
Revolving Exposure Limitations. All Multicurrency Swingline Loans shall be
Overnight LIBO Borrowings.

 

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(c) Any provision of this Agreement to the contrary notwithstanding, at the
request of the Company or any Foreign Subsidiary Borrower, the Administrative
Agent may in its sole discretion (but with absolutely no obligation), make
Dollar Tranche Revolving Loans or Multicurrency Tranche Revolving Loans in any
Agreed Currency to the Company or such Foreign Subsidiary Borrower, on behalf of
the Dollar Tranche Lenders or Multicurrency Tranche Lenders in amounts that
exceed the Availability (any such excess Loans, “Overadvances”); provided that,
no Overadvance shall result in a Default due to any Borrower’s failure to comply
with the Revolving Exposure Limitations for so long as such Overadvance remains
outstanding in accordance with the terms of this paragraph, but solely with
respect to the amount of such Overadvance. In addition, Overadvances may be made
even if the condition precedent set forth in Section 4.02(c) has not been
satisfied. All Overadvances made to the Company and denominated in Dollars shall
be ABR Borrowings, and all Overadvances made to the Company in any Foreign
Currency or to any Foreign Subsidiary Borrower in any Agreed Currency shall be
Overnight LIBO Borrowings. The authority of the Administrative Agent to make
Overadvances is limited at any time to an aggregate amount not to exceed an
amount equal to 10% of the Aggregate Commitments at such time, no Overadvance
may remain outstanding for more than thirty (30) days, no Overadvance shall
cause any Lender’s Dollar Tranche Revolving Exposure to exceed its Dollar
Tranche Commitment, and no Overadvance shall cause any Lender’s Multicurrency
Tranche Revolving Exposure to exceed its Multicurrency Tranche Commitment;
provided that, the Required Lenders may at any time revoke the Administrative
Agent’s authorization to make Overadvances. Any such revocation must be in
writing and shall become effective prospectively upon the Administrative Agent’s
receipt thereof.

(d) Upon the making of a Swingline Loan or an Overadvance (whether before or
after the occurrence of a Default and regardless of whether a Settlement has
been requested with respect to such Swingline Loan or Overadvance), each Dollar
Tranche Lender or Multicurrency Tranche Lender, as applicable, shall be deemed,
without further action by any party hereto, to have unconditionally and
irrevocably purchased from the Swingline Lender or the Administrative Agent, as
the case may be, without recourse or warranty, an undivided interest and
participation in such Swingline Loan or Overadvance in proportion to its
Applicable Percentage of the applicable Commitment. The Swingline Lender or the
Administrative Agent may, at any time, require the Lenders to fund their
participations. From and after the date, if any, on which any Lender is required
to fund its participation in any Swingline Loan or Overadvance purchased
hereunder, the Administrative Agent shall promptly distribute to such Lender,
such Lender’s Applicable Percentage of all payments of principal and interest
and all proceeds of Collateral received by the Administrative Agent in respect
of such Loan.

(e) The Administrative Agent, on behalf of the Swingline Lender, shall request
settlement (a “Settlement”) with the Lenders on at least a weekly basis or on
any date that the Administrative Agent elects, by notifying the applicable
Lenders of such requested Settlement by facsimile, telephone, or e-mail no later
than 1:00 p.m., Local Time (i) on the date of such requested Settlement (the
“Settlement Date”), with respect to Swingline Loans and Overadvances denominated
in Dollars and (ii) three (3) Business Days prior to the Settlement Date, with
respect to Multicurrency Swingline Loans or Overadvances denominated in any
Foreign Currency (or on the Settlement Date, if a Default or Event of Default
has occurred and is continuing). Each applicable Lender (other than the
Swingline Lender, in the case of the Swingline Loans) shall transfer the amount
of such Lender’s Applicable Percentage of the outstanding principal amount of
the applicable Loan with respect to which Settlement is requested to the
Administrative Agent, to such account of the Administrative Agent as the
Administrative Agent may designate, not later than 3:00 p.m., Local Time, on
such Settlement Date. Settlements may occur during the existence of a Default
and whether or not the applicable conditions precedent set forth in Section 4.02
have then been satisfied. Such amounts transferred to the Administrative Agent
shall be applied against the amounts of the Swingline Lender’s

 

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Swingline Loans and, together with Swingline Lender’s Applicable Percentage of
such Swingline Loan, shall constitute Revolving Loans of such Lenders (which
shall be an ABR Loan, in the case of any Swingline Loan or Overadvance made to
the Company and denominated in Dollars, and a Eurocurrency Revolving Loan in the
relevant Agreed Currency with an Interest Period of one week, in the case of any
Multicurrency Swingline Loan or Overadvance made to the Company in a Foreign
Currency or to a Foreign Subsidiary Borrower denominated in any Agreed
Currency), and shall no longer constitute a Swingline Loan or Overadvance, as
applicable. If any such amount is not transferred to the Administrative Agent by
any applicable Lender on such Settlement Date, the Swingline Lender shall be
entitled to recover such amount on demand from such Lender together with
interest thereon as specified in Section 2.08.

SECTION 2.07. Letters of Credit. (a) General. Subject to the terms and
conditions set forth herein, the Company or any Foreign Subsidiary Borrower may
request the issuance of Dollar Tranche Letters of Credit for its own account and
the Company or any Foreign Subsidiary Borrower may request Multicurrency Tranche
Letters of Credit for its own account, in each case, in a form reasonably
acceptable to the Administrative Agent and the Issuing Bank, at any time and
from time to time during the Availability Period. 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 any Borrower to, or entered into by any Borrower with, the Issuing
Bank relating to any Letter of Credit, the terms and conditions of this
Agreement shall control. The letters of credit identified on Schedule 2.07 (the
“Existing Letters of Credit”) shall be deemed to be “Letters of Credit” issued
on the Effective Date for all purposes of the Loan Documents.

(b) Notice of Issuance, Amendment, Renewal, Extension; Certain Conditions. To
request the issuance of a Letter of Credit (or the amendment, renewal or
extension of an outstanding Letter of Credit), the applicable Borrower shall
hand deliver or facsimile (or transmit by electronic communication, if
arrangements for doing so have been approved by the Issuing Bank) to the Issuing
Bank and the Administrative Agent (reasonably 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 such Letter of Credit is a Dollar
Tranche Letter of Credit or Multicurrency Tranche Letter of Credit, the currency
in which such Letter of Credit is to be denominated (if such Letter of Credit is
not a Dollar Tranche Letter of Credit), the name and address of the beneficiary
thereof and such other information as shall be necessary to prepare, amend,
renew or extend such Letter of Credit. If requested by the Issuing Bank, the
applicable Borrower also shall submit a letter of credit application on the
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
applicable Borrower shall be deemed to represent and warrant that), after giving
effect to such issuance, amendment, renewal or extension (i) the Dollar Amount
of the LC Exposure with respect to all Letters of Credit issued for the account
of the Company shall not exceed $30,000,000, (ii) the Dollar Amount of the
Standby LC Exposure with respect to all Letters of Credit issued for the account
of the Company shall not exceed $15,000,000, (iii) the Dollar Amount of the LC
Exposure with respect to all Letters of Credit issued for the account of the
Foreign Subsidiary Borrowers shall not exceed $5,000,000, and (iv) the Borrowers
shall be in compliance with the Revolving Exposure Limitations.

 

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(c) Expiration Date. 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 (5) Business Days prior to the Maturity Date.

(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 Issuing Bank or any Lender in respect of the Tranche under
which such Letter of Credit is issued (each such Lender, an “Applicable
Lender”), the Issuing Bank hereby grants to each Applicable Lender, and each
Applicable Lender hereby acquires from the Issuing Bank, a participation in such
Letter of Credit equal to such Applicable Lender’s Applicable Percentage of the
aggregate Dollar Amount available to be drawn under such Letter of Credit. In
consideration and in furtherance of the foregoing, each Applicable Lender hereby
absolutely and unconditionally agrees to pay to the Administrative Agent, for
the account of the Issuing Bank, such Applicable Lender’s Applicable Percentage
of each LC Disbursement made by the Issuing Bank and not reimbursed by the
applicable Borrower on the date due as provided in paragraph (e) of this
Section, or of any reimbursement payment required to be refunded to the
applicable Borrower for any reason. Each 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 Issuing Bank shall make any LC Disbursement in respect
of a Letter of Credit, the applicable Borrower shall reimburse such LC
Disbursement by paying to the Administrative Agent in such Agreed Currency as
was paid by the Issuing Bank unless otherwise agreed by the Issuing Bank and the
Company, in an amount equal to such LC Disbursement) not later than 12:00 noon,
Local Time, on the date that such LC Disbursement is made, if such Borrower
shall have received notice of such LC Disbursement prior to 10:00 a.m., Local
Time, on such date, or, if such notice has not been received by such Borrower
prior to such time on such date, then not later than 12:00 noon, Local Time, on
the Business Day immediately following the day that such Borrower receives such
notice, if such notice is not received prior to such time on the day of receipt;
provided that, if such LC Disbursement is not less than the Dollar Amount of
$1,000,000, the Company may, subject to the conditions to borrowing set forth
herein, request in accordance with Section 2.03 or 2.06 that such payment be
financed with an ABR Revolving Borrowing or Swingline Loan in a Dollar Amount
equal to the amount of such LC Disbursement and, to the extent so financed, the
applicable Borrower’s obligation to make such payment shall be discharged and
replaced by the resulting ABR Revolving Borrowing or Swingline Loan. If any
Borrower fails to make such payment when due, the Administrative Agent shall
notify each Applicable Lender of the applicable LC Disbursement, the payment
then due from such Borrower in respect thereof and such Lender’s Applicable
Percentage thereof. Promptly following receipt of such notice, each Applicable
Lender shall pay to the Administrative Agent its Applicable Percentage of the
payment then due from such Borrower, in the same manner as provided in
Section 2.08 with respect to Loans made by such Lender (and Section 2.08 shall
apply, mutatis mutandis, to the payment obligations of the Applicable Lenders),
and the Administrative Agent shall promptly pay to the Issuing Bank the amounts
so received by it from the Applicable Lenders. Promptly following receipt by the
Administrative Agent of any payment from any Borrower pursuant to this
paragraph, the Administrative Agent shall distribute such payment to the Issuing
Bank or, to the extent that Applicable Lenders have made payments pursuant to
this paragraph to reimburse the Issuing Bank, then to such Lenders and the
Issuing Bank as their interests may appear. Any payment made by an Applicable
Lender pursuant to this paragraph to reimburse the Issuing Bank for any LC
Disbursement (other than the funding of ABR Revolving Loans or a Swingline Loan
as contemplated above) shall not constitute a Loan and shall not relieve any
Borrower of its obligation to reimburse such LC Disbursement. If any Borrower’s
reimbursement of, or

 

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obligation to reimburse, any amounts in any Foreign Currency would subject the
Administrative Agent, the Issuing Bank or any Multicurrency Tranche Lender to
any stamp duty, ad valorem charge or similar tax that would not be payable if
such reimbursement were made or required to be made in Dollars, such Borrower
shall, at its option, either (x) pay the amount of any such tax requested by the
Administrative Agent, the Issuing Bank or the relevant Multicurrency Tranche
Lender or (y) reimburse each LC Disbursement made in such Foreign Currency in
Dollars, in an amount equal to the Equivalent Amount, calculated using the
applicable exchange rates, on the date such LC Disbursement is made, of such LC
Disbursement.

(f) Obligations Absolute. Each Borrower’s obligation to reimburse LC
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 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, such Borrower’s obligations hereunder.
Neither the Administrative Agent, the Lenders nor the 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 the
Issuing Bank; provided that the foregoing shall not be construed to excuse the
Issuing Bank from liability to any Borrower to the extent of any direct damages
(as opposed to consequential damages, claims in respect of which are hereby
waived by the applicable Borrower to the extent permitted by applicable law)
suffered by such Borrower that are caused by the 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. The parties hereto
expressly agree that, in the absence of gross negligence or willful misconduct
on the part of the Issuing Bank (as finally determined by a court of competent
jurisdiction), the Issuing Bank shall be deemed to have exercised care in each
such determination. In furtherance of the foregoing and without limiting the
generality thereof, the parties agree that, with respect to documents presented
which appear on their face to be in substantial compliance with the terms of a
Letter of Credit, the Issuing Bank may, in its sole discretion, either accept
and make payment upon such documents without responsibility for further
investigation, regardless of any notice or information to the contrary, or
refuse to accept and make payment upon such documents if such documents are not
in strict compliance with the terms of such Letter of Credit.

(g) Disbursement Procedures. The Issuing Bank shall, promptly following its
receipt thereof, examine all documents purporting to represent a demand for
payment under a Letter of Credit. The Issuing Bank shall promptly notify the
Administrative Agent and the applicable Borrower by telephone (confirmed by
facsimile) of such demand for payment and whether the Issuing Bank has made or
will make an LC Disbursement thereunder; provided that any failure to give or
delay in giving such notice shall not relieve any Borrower of its obligation to
reimburse the Issuing Bank and the Applicable Lenders with respect to any such
LC Disbursement.

 

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(h) Interim Interest. If the Issuing Bank shall make any LC Disbursement, then,
unless a Borrower shall reimburse such LC Disbursement in full when such
reimbursement is due pursuant to paragraph (e) of this Section, the unpaid
amount thereof shall bear interest, for each day from and including the date
such LC Disbursement is made to but excluding the date that a Borrower
reimburses such LC Disbursement, at the rate per annum then applicable to ABR
Revolving Loans (or in the case such LC Disbursement is denominated in a Foreign
Currency, at the Overnight LIBO Rate for such Agreed Currency plus the then
effective Applicable Rate with respect to Overnight LIBO Loans); provided that,
if any Borrower fails to reimburse such LC Disbursement when due pursuant to
paragraph (e) of this Section, then Section 2.14(c) shall apply. Interest
accrued pursuant to this paragraph shall be for the account of the Issuing Bank,
except that interest accrued on and after the date of payment by any Applicable
Lender pursuant to paragraph (e) of this Section to reimburse the Issuing Bank
shall be for the account of such Applicable Lender to the extent of such
payment.

(i) Replacement of the Issuing Bank. The Issuing Bank may be replaced at any
time by written agreement among the Company, the Administrative Agent, the
replaced Issuing Bank and the successor Issuing Bank. The Administrative Agent
shall notify the Lenders of any such replacement of the Issuing Bank. At the
time any such replacement shall become effective, each applicable Borrower shall
pay all unpaid fees accrued for the account of the replaced Issuing Bank
pursuant to Section 2.13(b). From and after the effective date of any such
replacement, (i) the successor Issuing Bank shall have all the rights and
obligations of the 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 an Issuing Bank under this Agreement with respect to
Letters of Credit then outstanding and 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, on the Business Day that any Borrower receives notice from the
Administrative Agent or the Required Lenders (or, if the maturity of the Loans
has been accelerated, Lenders with LC Exposure representing greater than 50% of
the total LC Exposure) demanding the deposit of cash collateral pursuant to this
paragraph, the Borrowers shall deposit in an account with the Administrative
Agent, in the name of the Administrative Agent and for the benefit of the
Lenders (the “LC Collateral Account”), an aggregate amount in cash equal to 105%
of the Dollar Amount of the LC Exposure as of such date plus any accrued and
unpaid interest thereon; provided that (i) the portions of such amount
attributable to undrawn Foreign Currency Letters of Credit or LC Disbursements
in a Foreign Currency that any Borrower is not late in reimbursing shall be
deposited in the applicable Foreign Currencies in the actual amounts of such
undrawn Letters of Credit and LC Disbursements and (ii) 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, upon the occurrence of any Event of Default with respect to any
Borrower described in clause (h) or (i) of Article VII. For the purposes of this
paragraph, the Foreign Currency LC Exposure shall be calculated using the
applicable Exchange Rate on the date notice demanding cash collateralization is
delivered to any applicable Borrower. Each applicable Borrower also shall
deposit cash collateral pursuant to this paragraph as and to the extent required
by Section 2.12(b). Such deposit shall be held by the Administrative Agent as
collateral for the payment and performance of the Secured Obligations or Foreign
Secured Obligations (as applicable). The Administrative Agent shall have
exclusive dominion and control, including the exclusive right of withdrawal,
over such account and the Company hereby grants the Administrative Agent a
security interest in the LC Collateral Account. Other than any interest earned
on the investment of such deposits, which investments shall be made at the
option and sole discretion

 

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of the Administrative Agent and at the Borrowers’ risk and expense, such
deposits shall not bear interest. Interest or profits, if any, on such
investments shall accumulate in such account. Moneys in such account shall be
applied by the Administrative Agent to reimburse the Issuing Bank for LC
Disbursements for which it has not been reimbursed and, to the extent not so
applied, shall be held for the satisfaction of the reimbursement obligations of
the Borrowers for the LC Exposure at such time or, if the maturity of the Loans
has been accelerated (but subject to the consent of Lenders with LC Exposure
representing greater than 50% of the total LC Exposure), be applied to satisfy
other Secured Obligations or Foreign Secured Obligations (as applicable). If any
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 such Borrower within three
(3) Business Days after all Events of Default have been cured or waived.
Notwithstanding anything in this Agreement to the contrary, cash collateral
provided by any Foreign Subsidiary Borrower shall be used solely to pay the
Foreign Secured Obligations.

SECTION 2.08. 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 (i) in the case of Loans denominated in Dollars, by
2:00 p.m., New York City time, to the account of the Administrative Agent most
recently designated by it for such purpose by notice to the Lenders and (ii) in
the case of each Loan denominated in a Foreign Currency, by 12:00 noon, Local
Time, in the city of the Administrative Agent’s Eurocurrency Payment Office for
such currency and at such Eurocurrency Payment Office for such currency in an
amount equal to such Lender’s Applicable Percentage; provided that, Swingline
Loans shall be made as provided in Section 2.06. The Administrative Agent will
make such Loans available to the relevant Borrower by promptly crediting the
amounts so received, in like funds, to the applicable Funding Account; provided
that ABR Revolving Loans made to finance the reimbursement of (i) an LC
Disbursement as provided in Section 2.07(e) shall be remitted by the
Administrative Agent to the Issuing Bank and (ii) a Protective Advance or an
Overadvance shall be retained by the Administrative Agent.

(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
reliance upon such assumption, make available to the relevant 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 such Borrower severally agree to pay to the Administrative
Agent forthwith on demand such corresponding amount with interest thereon, for
each day from and including the date such amount is made available to such
Borrower to but excluding the date of payment to the Administrative Agent, at
(i) in the case of such Lender, 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 (including without limitation the
Overnight LIBO Rate in the case of Loans denominated in a Foreign Currency) or
(ii) in the case of such 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 2.09. 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 relevant 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. A 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.

 

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(b) To make an election pursuant to this Section, a Borrower, or the Borrower
Representative on its behalf, shall notify the Administrative Agent of such
election (by telephone or irrevocable written notice in the case of a Borrowing
denominated in Dollars to the Company or by irrevocable written notice (via an
Interest Election Request in a form approved by the Administrative Agent and
signed by such Borrower, or the Borrower Representative on its behalf) in the
case of a Borrowing denominated in a Foreign Currency or to a Foreign Subsidiary
Borrower) by the time that a Borrowing Request would be required under Section
2.03 if such Borrower were requesting a Revolving 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 by hand delivery or facsimile to the Administrative Agent of
a written Interest Election Request in a form approved by the Administrative
Agent and signed by the relevant Borrower, or the Borrower Representative on its
behalf. Notwithstanding any contrary provision herein, this Section shall not be
construed to permit any Borrower to (i) change the currency of any Borrowing,
(ii) elect an Interest Period for Eurocurrency Loans that does not comply with
Section 2.02(d) or (iii) convert any Borrowing to a Borrowing of a Type not
available under the Class of Commitments pursuant to which such Borrowing was
made.

(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 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 applicable Borrower shall be deemed to
have selected an Interest Period of one month’s duration.

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

(e) If the relevant 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 (i) in the case of a Borrowing denominated in
Dollars borrowed by the Company, such Borrowing shall be converted to an ABR
Borrowing and (ii) in the case of a Borrowing denominated in a Foreign Currency
(or in

 

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Dollars by a Foreign Subsidiary Borrower) in respect of which the applicable
Borrower shall have failed to deliver an Interest Election Request prior to the
third (3rd) Business Day preceding the end of such Interest Period, such
Borrowing shall automatically continue as a Eurocurrency Borrowing in the same
Agreed Currency with an Interest Period of one month unless such Eurocurrency
Borrowing is or was repaid in accordance with Section 2.12. Notwithstanding any
contrary provision hereof, if an Event of Default has occurred and is continuing
and the Administrative Agent, at the request of the Required Lenders, so
notifies the Company, then, so long as an Event of Default is continuing (i) no
outstanding Borrowing borrowed by the Company may be converted to or continued
as a Eurocurrency Borrowing, (ii) unless repaid, each Eurocurrency Revolving
Borrowing in Dollars borrowed by the Company shall be converted to an ABR
Borrowing at the end of the Interest Period applicable thereto and (iii) unless
repaid, each Eurocurrency Revolving Borrowing in a Foreign Currency and each
Eurocurrency Revolving Borrowing by a Foreign Subsidiary Borrower shall
automatically be continued as a Eurocurrency Borrowing with an Interest Period
of one month.

SECTION 2.10. Termination and Reduction of Commitments; Increase in Commitments.
(a) Unless previously terminated, the Commitments shall terminate on the
Maturity Date.

(b) The Company may at any time terminate the Commitments upon (i) the payment
in full of all outstanding Loans, together with accrued and unpaid interest
thereon and on any Letters of Credit, (ii) the cancellation and return of all
outstanding Letters of Credit (or alternatively, with respect to each such
Letter of Credit, the furnishing to the Administrative Agent of a cash deposit
(or at the discretion of the Administrative Agent a back up standby letter of
credit reasonably satisfactory to the Administrative Agent) equal to 105% of the
LC Exposure as of such date), (iii) the payment in full of the accrued and
unpaid fees and (iv) the payment in full of all reimbursable expenses and other
Obligations together with accrued and unpaid interest thereon.

(c) The Company may from time to time reduce the Commitments; provided that
(i) each reduction of the Commitments shall be in an amount that is an integral
multiple of $500,000 and not less than $5,000,000 and (ii) the Company shall not
reduce the Commitments if, after giving effect to any concurrent prepayment of
the Revolving Loans in accordance with Section 2.11, the Borrowers would not be
in compliance with the Revolving Exposure Limitations.

(d) The Company shall notify the Administrative Agent of any election to
terminate or reduce the Commitments under paragraph (b) or (c) of this Section
at least three (3) 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
Lenders of the contents thereof. Each notice delivered by the Company pursuant
to this Section shall be irrevocable; provided that a notice of termination of
the Commitments delivered by the Company may state that such notice is
conditioned upon the effectiveness of other credit facilities, in which case
such notice may be revoked by the Company (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 shall be made ratably among the Lenders in
accordance with their respective Commitments.

(e) The Company shall have the right to increase the total Dollar Tranche
Commitments and/or the total Multicurrency Tranche Commitments by obtaining
additional Commitments, either from one or more of the Lenders or another
lending institution; provided that (i) any such request for an increase shall be
in a minimum amount of $5,000,000, (ii) the Company may make a maximum of five
(5) such requests, (iii) after giving effect thereto, the sum of the total of
the Commitments does not exceed $200,000,000, (iv) the Administrative Agent has
approved the identity of any such new Lender, such approval not to be
unreasonably withheld, (v) any such new Lender assumes all of the rights and
obligations of a “Lender” hereunder, and (vi) the procedures described in
Section 2.10(f) have been satisfied.

 

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(f) Any amendment hereto for such an increase or addition shall be in form and
substance reasonably satisfactory to the Administrative Agent and shall only
require the written signatures of the Administrative Agent, the Borrowers and
the Lender(s) being added or increasing their Commitment. As a condition
precedent to such an increase, the Borrowers shall deliver to the Administrative
Agent (i) a certificate of each Loan Party signed by an authorized officer of
such Loan Party (A) certifying and attaching the resolutions adopted by such
Loan Party approving or consenting to such increase, and (B) in the case of the
Borrowers, certifying that, before and after giving effect to such increase,
(1) the representations and warranties contained in Article III and the other
Loan Documents are true and correct, except to the extent that such
representations and warranties specifically refer to an earlier date, in which
case they are true and correct as of such earlier date, and (2) no Default
exists and (ii) legal opinions and documents consistent with those delivered on
the Effective Date as to the corporate power and authority of the Loan Parties.

(g) Within a reasonable time after the effective date of any increase, the
Administrative Agent shall, and is hereby authorized and directed to, revise
Schedule 2.01 to reflect such increase and shall distribute such revised
Schedule 2.01 to each of the Lenders and the Borrowers, whereupon such revised
Schedule 2.01 shall replace the old Schedule 2.01 and become part of this
Agreement effective as of the effective date of such increase. On the Business
Day following any such increase, all outstanding ABR Loans shall be reallocated
among the Lenders (including any newly added Lenders) in accordance with the
Lenders’ respective revised Applicable Percentages. Eurocurrency Loans shall not
be reallocated among the Lenders until the expiration of the applicable Interest
Period in effect at the time of any such increase, at which time any such
Eurocurrency Loan being continued shall be reallocated, and any such
Eurocurrency Loan being converted to ABR Loans in accordance with this Agreement
shall be converted and allocated, among the Lenders (including the newly added
Lenders) at such time.

SECTION 2.11. Repayment and Amortization of Loans; Evidence of Debt. (a) Each
Borrower hereby unconditionally promises to pay (i) to the Administrative Agent
for the account of each Lender the then unpaid principal amount of each
Revolving Loan made to such Borrower on the Maturity Date in the currency of
such Loan, (ii) to the Administrative Agent the then unpaid amount of each
Protective Advance on the earlier of the Maturity Date and demand by the
Administrative Agent, and (iii) to the Administrative Agent the then unpaid
principal amount of each Overadvance on the earlier of the Maturity Date and
demand by the Administrative Agent.

(b) In the case of all Domestic Loan Parties, at all times that full cash
dominion is in effect pursuant to Section 7.1 of the Domestic Security
Agreement, on each Business Day, the Administrative Agent shall apply all funds
credited to the Collection Account (as defined in the Domestic Security
Agreement) the previous Business Day (once available) first to prepay any
Protective Advances and Overadvances that may be outstanding, pro rata, and
second to prepay the Revolving Loans (including Swingline Loans) and to cash
collateralize outstanding LC Exposure. In the case of all Foreign Loan Parties,
on each Business Day, the Administrative Agent shall apply all funds credited to
the Collection Account (as defined in each Foreign Security Agreement) the
previous Business Day (once available) first to prepay any Protective Advances
and Overadvances that may be outstanding and that constitute Foreign Secured
Obligations, pro rata, and second to prepay the Revolving Loans (including
Swingline Loans) and to cash collateralize outstanding LC Exposure, in each
case, that constitute Foreign Secured Obligations.

 

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(c) Each Lender shall maintain in accordance with its usual practice an account
or accounts evidencing the indebtedness of each 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.

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

(e) The entries made in the accounts maintained pursuant to paragraph (c) or
(d) 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 any Borrower to repay the Loans in
accordance with the terms of this Agreement.

(f) Any Lender may request that Loans made by it to any Borrower be evidenced by
a promissory note. In such event, the relevant 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 any
such promissory note is a registered note, to such payee and its registered
assigns).

SECTION 2.12. Prepayment of Loans. (a) Each Borrower shall have the right at any
time and from time to time to prepay any Borrowing in whole or in part, subject
to prior notice in accordance with paragraph (f) of this Section.

(b) Except for Overadvances permitted under Section 2.06, if, at any time,
(i) other than as a result of fluctuations in currency exchange rates, the
Borrowers are not in compliance with the Revolving Exposure Limitations
(calculated, with respect to those Credit Events denominated in Foreign
Currencies, as of the most recent Computation Date with respect to each such
Credit Event) or (ii) solely as a result of fluctuations in currency exchange
rates, the sum of the aggregate principal Dollar Amount of all of the
Multicurrency Tranche Revolving Exposures (so calculated) exceeds 105% of the
aggregate Multicurrency Tranche Commitments, the Borrowers shall in each case
immediately repay Borrowings or cash collateralize LC Exposure in an account
with the Administrative Agent pursuant to Section 2.07(j), as applicable, in an
aggregate principal amount sufficient to cause the Borrowers to be in compliance
with the Revolving Exposure Limitations.

(c) In the event and on each occasion that any Net Proceeds are received by or
on behalf of any Loan Party in respect of any Prepayment Event, the Company
shall, immediately after such Net Proceeds are received by any Loan Party,
prepay the Obligations as set forth in Section 2.12(e) below in an aggregate
amount equal to 100% of such Net Proceeds. Notwithstanding the foregoing, no Net
Proceeds received by any Foreign Loan Party in respect of any Prepayment Event
shall be used to prepay any Obligations other than the Foreign Secured
Obligations.

(d) [Reserved]

 

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(e) All such amounts pursuant to Section 2.12(c) (as to any insurance or
condemnation proceeds, to the extent they arise from casualties or losses to
Equipment, Fixtures and real property) shall be applied, first to prepay any
Protective Advances and Overadvances that may be outstanding, pro rata and
second to prepay the Revolving Loans (including Swingline Loans) without a
corresponding reduction in the Aggregate Commitment and to cash collateralize
outstanding LC Exposure. All such amounts pursuant to Section 2.12(c) (as to any
insurance or condemnation proceeds, to the extent they arise from casualties or
losses to cash or Inventory) shall be applied, first to prepay any Protective
Advances and Overadvances that may be outstanding, pro rata, and second to
prepay the Revolving Loans (including Swingline Loans) without a corresponding
reduction in the Aggregate Commitment and to cash collateralize outstanding LC
Exposure. If the precise amount of insurance or condemnation proceeds allocable
to Inventory as compared to Equipment, Fixtures and real property is not
otherwise determined, the allocation and application of those proceeds shall be
determined by the Administrative Agent, in its Permitted Discretion.
Notwithstanding the foregoing, no Net Proceeds received by any Foreign Loan
Party in respect of any Prepayment Event shall be used to prepay any Obligations
other than the Foreign Secured Obligations.

(f) The applicable Borrower, or the Borrower Representative on its behalf, shall
notify the Administrative Agent (and, in the case of prepayment of a Swingline
Loan, the Swingline Lender) in writing (confirmed by telephone) of any
prepayment hereunder (i) in the case of prepayment of a Eurocurrency Revolving
Borrowing, not later than 11:00 a.m., Local Time, three (3) Business Days (in
the case of a Eurocurrency Borrowing denominated in Dollars) or four
(4) Business Days (in the case of a Eurocurrency Borrowing denominated in a
Foreign Currency), in each case, before the date of prepayment, or (ii) in the
case of prepayment of an ABR Revolving Borrowing or Overnight LIBO Borrowing,
not later than 11:00 a.m., Local Time, one (1) Business Day before the date of
prepayment. Each such notice shall be irrevocable and shall specify the
prepayment date and the principal amount of each Borrowing or portion thereof to
be prepaid; provided that, if a notice of prepayment is given in connection with
a conditional notice of termination of the Commitments as contemplated by
Section 2.10, then such notice of prepayment may be revoked if such notice of
termination is revoked in accordance with Section 2.10. Promptly following
receipt of any such notice relating to a Revolving Borrowing, the Administrative
Agent shall advise the Lenders of the contents thereof. Each partial prepayment
of any Revolving Borrowing shall be in an amount that would be permitted in the
case of an advance of a Revolving Borrowing of the same Type as provided in
Section 2.02. Each prepayment of a Revolving Borrowing shall be applied ratably
to the Revolving Loans included in the prepaid Borrowing. Prepayments shall be
accompanied by accrued interest to the extent required by Section 2.14.

SECTION 2.13. Fees. (a) The Company agrees to pay to the Administrative Agent
for the account of each Lender a commitment fee, which shall accrue at the
Applicable Rate on the average daily amount of the Available Commitment of such
Lender during the period from and including the Effective Date to but excluding
the date on which the Lenders’ Commitments terminate. Accrued commitment fees
shall be payable in arrears on the first Business Day of each calendar month and
on the date on which the Commitments terminate, commencing on the first such
date to occur after the date hereof. All commitment fees shall be computed on
the basis of a year of 360 days and shall be payable for the actual number of
days elapsed.

(b) The Company agrees to pay (i) to the Administrative Agent for the account of
each Lender a participation fee with respect to its participations in Letters of
Credit, which shall accrue, in the case of standby Letters of Credit, at the
same Applicable Rate and, in the case of Commercial Letters of Credit, at 50% of
the same Applicable Rate, in each case, used to determine the interest rate
applicable to Eurocurrency Revolving Loans on the average daily Dollar Amount of
such Lender’s LC Exposure (excluding any portion thereof attributable to
unreimbursed LC Disbursements)

 

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during the period from and including the Effective Date to but excluding the
later of the date on which such Lender’s Commitment terminates and the date on
which such Lender ceases to have any LC Exposure, and (ii) to the Issuing Bank a
fronting fee, which shall accrue at the rate of 0.25% per annum on the average
daily Dollar Amount of the LC Exposure (excluding any portion thereof
attributable to unreimbursed LC Disbursements) during the period from and
including the Effective Date to but excluding the later of the date of
termination of the Commitments and the date on which there ceases to be any LC
Exposure, as well as the Issuing Bank’s standard fees and commissions with
respect to the issuance, amendment, renewal or extension of any Letter of Credit
or processing of drawings thereunder. Participation fees and fronting fees
accrued through and including the last day of each calendar month shall be
payable on the first Business Day of each calendar month following such last
day, commencing on the first such date to occur after the Effective Date;
provided that all such fees shall be payable on the date on which the
Commitments terminate and any such fees accruing after the date on which the
Commitments terminate shall be payable on demand. Any other fees payable to the
Issuing Bank pursuant to this paragraph shall be payable within ten (10) days
after demand. All participation fees and fronting fees shall be computed on the
basis of a year of 360 days and shall be payable for the actual number of days
elapsed.

(c) The Company agrees to pay to the Administrative Agent, for its own account,
fees payable in the amounts and at the times separately agreed upon between the
Company and the Administrative Agent.

(d) All fees payable hereunder shall be paid on the dates due, in Dollars
(except as otherwise expressly provided in this Section) and immediately
available funds, to the Administrative Agent (or to the Issuing Bank, in the
case of fees payable to it) for distribution, in the case of commitment fees and
participation fees, to the Lenders. Fees paid shall not be refundable under any
circumstances.

SECTION 2.14. Interest. (a) The Loans comprising each ABR Borrowing (including
each applicable Swingline Loan but excluding any Protective Advance or
Overadvance) shall bear interest at the Alternate Base Rate plus the Applicable
Rate. The Loans comprising each Overnight LIBO Borrowing (excluding any
Protective Advance or Overadvance) shall bear interest at the Overnight LIBO
Rate plus the Applicable Rate.

(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 Rate.

(c) All Protective Advances and Overadvances denominated in Dollars shall bear
interest at the Alternate Base Rate plus the Applicable Rate plus 2%. All
Protective Advances and Overadvances denominated in any other Agreed Currency
shall bear interest at the Overnight LIBO Rate plus the Applicable Rate plus 2%.

(d) Notwithstanding the foregoing, during the occurrence and continuance of an
Event of Default, the Administrative Agent or the Required Lenders may, at their
option, by notice to the Company (which notice may be revoked at the option of
the Required Lenders notwithstanding any provision of Section 9.02 requiring the
consent of “each Lender directly affected thereby” for reductions in interest
rates), declare that (i) all Loans shall bear interest at 2% plus the rate
otherwise applicable to such Loans as provided in the preceding paragraphs of
this Section or (ii) in the case of any other amount outstanding hereunder, such
amount shall accrue at 2% plus the rate applicable to such fee or other
obligation as provided hereunder.

 

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(e) Accrued interest on each Loan (for ABR Loans and Overnight LIBO Loans,
accrued through the last day of the prior calendar month) shall be payable in
arrears on each Interest Payment Date for such Loan and upon termination of the
Commitments; provided that (i) interest accrued pursuant to paragraph (d) 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.

(f) All interest hereunder shall be computed on the basis of a year of 360 days,
except that interest (i) computed by reference to the Alternate Base Rate at
times when the Alternate Base Rate 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 (ii) for
Borrowings denominated in Pounds Sterling shall be computed on the basis of a
year of 365 days, and in each case shall be payable for the actual number of
days elapsed. The applicable Alternate Base Rate, Adjusted LIBO Rate, LIBO Rate
or Overnight LIBO Rate shall be determined by the Administrative Agent, and such
determination shall be conclusive absent manifest error.

SECTION 2.15. Alternate Rate of Interest. (a) If prior to the commencement of
any Interest Period for a Eurocurrency Borrowing:

(i) 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

(ii) 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 (or Lender) of
making or maintaining their Loans (or its Loan) included in such Borrowing for
such Interest Period;

then the Administrative Agent shall give notice thereof to the applicable
Borrower and the Lenders by telephone or facsimile as promptly as practicable
thereafter and, until the Administrative Agent notifies the applicable 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
Revolving Borrowing to, or continuation of any Revolving Borrowing as, a
Eurocurrency Borrowing shall be ineffective and any such Eurocurrency Borrowing
shall be repaid on the last day of the then current Interest Period applicable
thereto, (ii) any Eurocurrency Borrowing by a Foreign Subsidiary Borrower that
is requested to be continued shall be repaid on the last day of the then current
Interest Period applicable thereto and (iii) if any Borrowing Request by the
Company requests a Eurocurrency Revolving Borrowing in Dollars, such Borrowing
shall be made as an ABR Borrowing (and if any Borrowing Request requests a
Eurocurrency Revolving Borrowing by a Foreign Subsidiary Borrower or denominated
in a Foreign Currency, such Borrowing shall be made as an Alternate Rate
Borrowing); provided that if the circumstances giving rise to such notice affect
only one Type of Borrowings, then the other Type of Borrowings shall be
permitted.

(b) If at any time the Administrative Agent determines (which determination
shall be conclusive absent manifest error) that adequate and reasonable means do
not exist for ascertaining the Overnight LIBO Rate or the Overnight LIBO Rate
will not adequately and fairly reflect the cost to the Administrative Agent or
the Swingline Lender, as applicable, of making or maintaining Protective
Advances, Overadvances or Swingline Loans, the Administrative Agent or Swingline
Lender, as applicable, shall give notice thereof to the applicable Borrower and
the Lenders by telephone or facsimile as promptly as practicable thereafter and,
until the Administrative Agent notifies the applicable Borrower and the Lenders
that the circumstances giving rise to such notice no longer exist, Overnight
LIBO Borrowings shall be made as Alternate Rate Borrowings.

 

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SECTION 2.16. 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 Overnight LIBO Rate) or the Issuing Bank;

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

(iii) subject any Recipient to any Taxes or U.K. Taxes on its loans, loan
principal, letters of credit, commitments, or other obligations, or its
deposits, reserves, other liabilities or capital attributable thereto (other
than (A) Indemnified Taxes, (B) Excluded Taxes and (C) U.K. Taxes consisting of
a Tax Deduction required by law to be made by a Borrower or compensated for by
Section 2.18A);

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

(b) If any Lender or the 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 the Issuing Bank’s capital or on the capital of
such Lender’s or the 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 the Issuing Bank, to a level
below that which such Lender or the Issuing Bank or such Lender’s or the Issuing
Bank’s holding company could have achieved but for such Change in Law (taking
into consideration such Lender’s or the Issuing Bank’s policies and the policies
of such Lender’s or the Issuing Bank’s holding company with respect to capital
adequacy), then from time to time the applicable Borrower will pay to such
Lender or the Issuing Bank, as the case may be, such additional amount or
amounts as will compensate such Lender or the Issuing Bank or such Lender’s or
the Issuing Bank’s holding company for any such reduction suffered.

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

(d) Failure or delay on the part of any Lender or the Issuing Bank to demand
compensation pursuant to this Section shall not constitute a waiver of such
Lender’s or the Issuing Bank’s right to demand such compensation; provided that
the Company shall not be required to

 

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compensate a Lender or the Issuing Bank pursuant to this Section for any
increased costs or reductions incurred more than 270 days prior to the date that
such Lender or the Issuing Bank, as the case may be, notifies the Company of the
Change in Law giving rise to such increased costs or reductions and of such
Lender’s or the Issuing Bank’s intention to claim compensation therefor;
provided further that, if the Change in Law giving rise to such increased costs
or reductions is retroactive, then the 270-day period referred to above shall be
extended to include the period of retroactive effect thereof.

SECTION 2.17. 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 (regardless of whether such notice may be revoked under
Section 2.10(d) and is revoked in accordance therewith), 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 Company pursuant to
Section 2.20, then, in any such event, the Borrowers 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
include an 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, 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
the relevant currency of a comparable amount and period from other banks in the
eurocurrency 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 applicable Borrower and shall be conclusive absent manifest
error. The applicable Borrower shall pay such Lender the amount shown as due on
any such certificate within ten (10) days after receipt thereof.

SECTION 2.18. Taxes.

(a) Withholding of Taxes; Gross-Up. Each payment by any Loan Party under any
Loan Document shall be made without withholding for any Taxes, unless such
withholding is required by any law. If any Withholding Agent determines, in its
sole discretion exercised in good faith, that it is so required to withhold
Taxes, then such Withholding Agent may so withhold and shall timely pay the full
amount of withheld Taxes to the relevant Governmental Authority in accordance
with applicable law. If such Taxes are Indemnified Taxes, then the amount
payable by such Loan Party shall be increased as necessary so that, net of such
withholding (including such withholding applicable to additional amounts payable
under this Section), the applicable Recipient receives the amount it would have
received had no such withholding been made.

(b) Payment of Other Taxes by the Borrowers. The Borrowers shall timely pay any
Other Taxes to the relevant Governmental Authority in accordance with applicable
law.

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

 

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(d) Indemnification by the Borrowers. Subject to Section 10.13, the Borrowers
shall jointly and severally indemnify each Recipient for any Indemnified Taxes
that are paid or payable by such Recipient in connection with any Loan Document
(including amounts paid or payable under this Section 2.18(d)) and any
reasonable expenses arising therefrom or with respect thereto, whether or not
such Indemnified Taxes were correctly or legally imposed or asserted by the
relevant Governmental Authority. The indemnity under this Section 2.18(d) shall
be paid within ten (10) days after the Recipient delivers to the Borrower
Representative a certificate stating the amount of any Indemnified Taxes so paid
or payable by such Recipient and describing the basis for the indemnification
claim. Such certificate shall be conclusive of the amount so paid or payable
absent manifest error. Such Recipient shall deliver a copy of such certificate
to the Administrative Agent.

(e) Indemnification by the Lenders. Each Lender shall severally indemnify the
Administrative Agent for any Taxes (but, in the case of any Indemnified Taxes,
only to the extent that any Loan Party has not already indemnified the
Administrative Agent for such Indemnified Taxes and without limiting the
obligation of the Loan Parties to do so) attributable to such Lender that are
paid or payable by the Administrative Agent in connection with any Loan Document
and any reasonable expenses arising therefrom or with respect thereto, whether
or not such Taxes were correctly or legally imposed or asserted by the relevant
Governmental Authority. The indemnity under this Section 2.18(e) shall be paid
within ten (10) days after the Administrative Agent delivers to the applicable
Lender a certificate stating the amount of Taxes so paid or payable by the
Administrative Agent. Such certificate shall be conclusive of the amount so paid
or payable absent manifest error.

(f) Status of Lenders. (i) Any Lender that is entitled to an exemption from, or
reduction of, any applicable withholding Tax with respect to any payments under
any Loan Document shall deliver to the Borrower Representative and the
Administrative Agent, at the time or times reasonably requested by the Borrower
Representative or the Administrative Agent, such properly completed and executed
documentation reasonably requested by the Borrower Representative or the
Administrative Agent as will permit such payments to be made without, or at a
reduced rate of, withholding. In addition, any Lender, if requested by the
Borrower Representative or the Administrative Agent, shall deliver such other
documentation prescribed by law or reasonably requested by the Borrower
Representative or the Administrative Agent as will enable the Borrower
Representative or the Administrative Agent to determine whether or not such
Lender is subject to any withholding (including backup withholding) or
information reporting requirements. Notwithstanding anything to the contrary in
the preceding two sentences, the completion, execution and submission of such
documentation (other than such documentation set forth in Section 2.18(f)(ii)(A)
through (E) below) shall not be required if in the Lender’s judgment such
completion, execution or submission would subject such Lender to any material
unreimbursed cost or expense or would materially prejudice the legal or
commercial position of such Lender. Upon the reasonable request of the Borrower
Representative or the Administrative Agent, any Lender shall update any form or
certification previously delivered pursuant to this Section 2.18(f). If any form
or certification previously delivered pursuant to this Section expires or
becomes obsolete or inaccurate in any respect with respect to a Lender, such
Lender shall promptly (and in any event within ten (10) days after such
expiration, obsolescence or inaccuracy) notify the Borrower Representative and
the Administrative Agent in writing of such expiration, obsolescence or
inaccuracy and update the form or certification if it is legally eligible to do
so.

(ii) Without limiting the generality of the foregoing, if any Borrower is a U.S.
Person, any Lender with respect to such Borrower shall, if it is legally
eligible to do so, deliver to the Borrower Representative and the Administrative
Agent (in such number of copies reasonably requested by the Borrower
Representative and the Administrative Agent) on or prior to the date on which
such Lender becomes a party hereto, duly completed and executed copies of
whichever of the following is applicable:

(A) in the case of a Lender that is a U.S. Person, IRS Form W-9 certifying that
such Lender is exempt from U.S. Federal backup withholding tax;

 

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(B) in the case of a Non-U.S. Lender claiming the benefits of an income tax
treaty to which the United States is a party (1) with respect to payments of
interest under any Loan Document, IRS Form W-8BEN establishing an exemption
from, or reduction of, U.S. Federal withholding Tax pursuant to the “interest”
article of such tax treaty and (2) with respect to any other applicable payments
under any Loan Document, IRS Form W-8BEN establishing an exemption from, or
reduction of, U.S. Federal withholding Tax pursuant to the “business profits” or
“other income” article of such tax treaty;

(C) in the case of a Non-U.S. Lender for whom payments under any Loan Document
constitute income that is effectively connected with such Lender’s conduct of a
trade or business in the United States, IRS Form W-8ECI;

(D) in the case of a Non-U.S. Lender claiming the benefits of the exemption for
portfolio interest under Section 881(c) of the Code both (1) IRS Form W-8BEN and
(2) a tax certificate substantially in the form of Exhibit G-1 to the effect
that such 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 Company within the meaning of
Section 881(c)(3)(B) of the Code, (c) a “controlled foreign corporation”
described in Section 881(c)(3)(C) of the Code and (d) conducting a trade or
business in the United States with which the relevant interest payments are
effectively connected;

(E) in the case of a Non-U.S. Lender that is not the beneficial owner of
payments made under this Agreement (including a partnership or a participating
Lender) (1) an IRS Form W-8IMY on behalf of itself and (2) the relevant forms
prescribed in clauses (A), (B), (C), (D) and (F) of this paragraph (f)(ii) that
would be required of each such beneficial owner or partner of such partnership
if such beneficial owner or partner were a Lender; provided, however, that if
the Lender is a partnership and one or more of its partners are claiming the
exemption for portfolio interest under Section 881(c) of the Code, such Lender
may provide a tax certificate substantially in the form of Exhibit G-2 on behalf
of such partners; or

(F) any other form prescribed by law as a basis for claiming exemption from, or
a reduction of, U.S. Federal withholding Tax together with such supplementary
documentation necessary to enable the Borrower Representative or the
Administrative Agent to determine the amount of Tax (if any) required by law to
be withheld.

(iii) If a payment made to a Lender under any Loan Document would be subject to
U.S. Federal withholding Tax imposed by FATCA if such Lender were to fail to
comply with the applicable reporting requirements of FATCA (including those
contained in Section 1471(b) or 1472(b) of the Code, as applicable), such Lender
shall deliver to the Borrower Representative and the Administrative Agent, at
the time or times prescribed by law and at such time or times reasonably
requested by the Borrower Representative or the Administrative Agent, such
documentation prescribed

 

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by applicable law (including as prescribed by Section 1471(b)(3)(C)(i) of the
Code) and such additional documentation reasonably requested by the Borrower
Representative or the Administrative Agent as may be necessary for the Borrower
Representative and the Administrative Agent to comply with its obligations under
FATCA, to determine that such Lender has or has not complied with such Lender’s
obligations under FATCA and, as necessary, to determine the amount to deduct and
withhold from such payment. Solely for purposes of this Section 2.18(f)(iii),
“FATCA” shall include any amendments made to FATCA after the date of this
Agreement.

(g) If the Administrative Agent or a Lender determines, in its sole discretion,
that it has received a refund of any Taxes as to which it has been indemnified
by the Borrowers or with respect to which a Borrower has paid additional amounts
pursuant to this Section 2.18, it shall pay over such refund to the Borrowers
(but only to the extent of indemnity payments made, or additional amounts paid,
by the Borrowers under this Section 2.18 with respect to the Taxes giving rise
to such refund), net of all out-of-pocket expenses of the Administrative Agent
or such Lender and without interest (other than any interest paid by the
relevant Governmental Authority with respect to such refund); provided, that the
Borrowers, upon the request of the Administrative Agent or such Lender, agree to
repay the amount paid over to the Borrowers (plus any penalties, interest or
other charges imposed by the relevant Governmental Authority) to the
Administrative Agent or such Lender in the event the Administrative Agent or
such Lender is required to repay such refund to such Governmental Authority.
This Section shall not be construed to require the Administrative Agent or any
Lender to make available its tax returns (or any other information relating to
its taxes which it deems confidential) to any Borrower or any other Person.

SECTION 2.18A. U.K. Tax.

(a) Unless a contrary indication appears, in this Section 2.18A a reference to
“determines” or “determined” means a determination made in the absolute
discretion of the person making the determination.

(b) A Borrower shall make all payments to be made by it under a Loan Document
without any Tax Deduction, unless a Tax Deduction is required by law.

(c) A Borrower shall promptly upon becoming aware that it must make a Tax
Deduction (or that there is any change in the rate or the basis of a Tax
Deduction) notify the Administrative Agent accordingly. Similarly, a Lender
shall notify the Administrative Agent on becoming so aware in respect of a
payment payable to that Lender. If the Administrative Agent receives such
notification from a Lender it shall notify the relevant Borrower.

(d) If a Tax Deduction is required by law to be made by a Borrower under any
Loan Document, the amount of the payment due from a Borrower shall be increased
to an amount which (after making any Tax Deduction) leaves an amount equal to
the payment which would have been due if no Tax Deduction had been required.

 

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(e) A Borrower is not required to make an increased payment to a Lender under
clause (d) above for a Tax Deduction in respect of tax imposed by the United
Kingdom from a payment of interest on a Loan, if on the date on which the
payment falls due:

(i) the payment could have been made to the relevant Lender without a Tax
Deduction if it was a Qualifying Lender, but on that date that Lender is not or
has ceased to be a Qualifying Lender other than as a result of any change after
the date it became a Lender under this Agreement in (or in the interpretation,
administration, or application of) any law, Treaty or any published practice or
concession of any relevant taxing authority; or

(ii) the relevant Lender is a Qualifying Lender solely under sub-paragraph
(i)(b) of the definition of Qualifying Lender and:

(A) an officer of H.M. Revenue & Customs has given (and not revoked) a direction
(a “Direction”) under Section 931 of the ITA which relates to that payment and
that Lender has received from a Borrower a certified copy of that Direction; and

(B) the payment could have been made to the Lender without any Tax Deduction if
that Direction had not been made; or

(iii) the relevant Lender is a Qualifying Lender solely by virtue of paragraph
(i)(b) of the definition of Qualifying Lender and:

(A) the relevant Lender has not given a Tax Confirmation to the Company; and

(B) the payment could have been made to the Lender without any Tax Deduction if
the Lender had given a Tax Confirmation to the Company, on the basis that the
Tax Confirmation would have enabled the Company to have formed a reasonable
belief that the payment was an “excepted payment” for the purpose of Section 930
of the ITA; or

(iv) the relevant Lender is a Treaty Lender and a Borrower is able to
demonstrate that the payment could have been made to the Lender without the Tax
Deduction had that Lender complied with its obligations under clause (h) below.

(f) If a Borrower is required to make a Tax Deduction, such Borrower shall make
that Tax Deduction and any payment required in connection with that Tax
Deduction within the time allowed and in the minimum amount required by law.

(g) Within 30 days of making either a Tax Deduction or any payment required in
connection with that Tax Deduction, a Borrower shall deliver to the
Administrative Agent for the Lender entitled to the payment a statement under
Section 975 of the ITA or other evidence reasonably satisfactory to the Lender
that the Tax Deduction has been made or (as applicable) any appropriate payment
paid to the relevant taxing authority.

(h) (i) Subject to paragraph (ii) below, a Treaty Lender and a Borrower which
makes a payment to which that Treaty Lender is entitled shall co-operate in
completing any procedural formalities necessary for that Borrower to obtain
authorisation to make that payment without a Tax Deduction.

(ii) Nothing in paragraph (i) above shall require a Treaty Lender to:

(A) register under the HMRC DT Treaty Passport scheme;

(B) apply the HMRC DT Treaty Passport scheme to any Loan if it has so
registered; or

 

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(C) file Treaty forms if it has included an indication to the effect that it
wishes the HMRC DT Treaty Passport scheme to apply to this Agreement in
accordance with paragraph (i) below and the Borrower making that payment has not
complied with its obligations under paragraph (j) below.

(i) A Treaty Lender which holds a passport under the HMRC DT Treaty Passport
scheme, and which wishes that scheme to apply to this Agreement, shall provide
an indication to that effect by notifying the Company of its scheme reference
number and its jurisdiction of tax residence (and, in the case of a Treaty
Lender that is a party to this Agreement on the Effective Date, such scheme
reference number and jurisdiction of tax residence is reflected on Schedule 2.01
hereof).

(j) Where a Lender includes the indication described in paragraph (i) above the
relevant Borrower shall file a duly completed form DTTP2 in respect of such
Lender with HM Revenue & Customs, within 30 days of the date such Lender becomes
a Lender under this Agreement or, within 30 days of the date such Borrower
becomes a Borrower under this Agreement (as the case may be), and shall promptly
provide the Lender with a copy of that filing.

(k) A Borrower shall (within 3 Business Days of demand by the Administrative
Agent) pay to a Protected Party an amount equal to the loss, liability or cost
which that Protected Party determines will be or has been (directly or
indirectly) suffered for or on account of U.K. Tax by that Protected Party in
respect of any Loan Document.

(l) Clause (k) above shall not apply with respect to any U.K. Tax assessed on a
Protected Party:

(i) under the law of the jurisdiction in which that Protected Party is
incorporated or, if different, the jurisdiction (or jurisdictions) in which that
Protected Party is treated as resident for tax purposes; or

(ii) under the law of the jurisdiction in which that Protected Party’s facility
office is located in respect of amounts received or receivable in that
jurisdiction,

if that U.K. Tax is imposed on or calculated by reference to the net income
received or receivable (but not any sum deemed to be received or receivable) by
that Protected Party.

(m) Furthermore, clause (k) above shall not apply to the extent a loss,
liability or cost:

(i) is compensated for by an increased payment under clause (d) above; or

(ii) would have been compensated for by an increased payment under clause
(d) above but was not so compensated solely because one of the exclusions in
clause (e) applied.

(n) A Protected Party making, or intending to make a claim under clause
(k) above shall promptly notify the Administrative Agent of the event which will
give, or has given, rise to the claim, following which the Administrative Agent
shall notify the Borrowers.

(o) A Protected Party shall, on receiving a payment from a Borrower under clause
(k) above, notify the Administrative Agent.

 

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(p) If a Borrower makes a Tax Payment and the relevant Lender determines that:

(i) a Tax Credit is attributable either to an increased payment of which that
Tax Payment forms part or to that Tax Payment; and

(ii) that Lender has obtained, utilized and retained that Tax Credit,

the relevant Lender shall pay an amount to that Borrower which that Lender
determines will leave it (after that payment) in the same after-tax position as
it would have been in had the Tax Payment not been made by that Borrower.

(q) A Borrower shall pay and, within three (3) Business Days of demand,
indemnify each Credit Party against any cost, loss or liability that Credit
Party incurs in relation to all stamp duty, registration and other similar U.K.
Taxes payable in respect of any Loan Document (excluding, for the avoidance of
doubt, any such U.K. Tax arising in connection with an assignment or transfer by
that Credit Party of its rights under any Loan Document).

(r) All amounts set out, or expressed to be payable under a Loan Document by any
party to a Credit Party which (in whole or part) constitute the consideration
for a supply or supplies for VAT purposes shall be deemed to be exclusive of any
VAT which is chargeable on such supply or supplies, and accordingly, subject to
clause (s) below, if VAT is or becomes chargeable on any supply made by any
Credit Party to any party under a Loan Document, that party shall pay to the
Credit Party (in addition to and at the same time as paying the consideration
for such supply) an amount equal to the amount of such VAT (and such Credit
Party shall promptly provide an appropriate VAT invoice to such party).

(s) If VAT is or becomes chargeable on any supply made by any Credit Party (the
“Supplier”) to any other Credit Party (the “Supply Recipient”) under a Loan
Document, and any party other than the Supply Recipient (the “Subject Party”) is
required by the terms of any Loan Document to pay an amount equal to the
consideration for such supply to the Supplier (rather than being required to
reimburse the Supply Recipient in respect of that consideration), such party
shall also pay to the Supplier (in addition to and at the same time as paying
such amount) an amount equal to the amount of such VAT. The Supply Recipient
will promptly pay to the Subject Party an amount equal to any credit or
repayment obtained by the Supply Recipient from the relevant tax authority which
the Supply Recipient reasonably determines is in respect of such VAT.

(t) Where a Loan Document requires any party to reimburse a Credit Party for any
costs or expenses, that party shall also at the same time pay and indemnify the
Credit Party against all VAT incurred by the Credit Party in respect of the
costs or expenses to the extent that the Credit Party reasonably determines that
neither it nor any other member of any group of which it is a member for VAT
purposes is entitled to credit or repayment from the relevant tax authority in
respect of the VAT.

(u) Any reference in this Section 2.18A to any party shall, at any time when
such party is treated as a member of a group for VAT purposes, include (where
appropriate and unless the context otherwise requires) a reference to the
representative member of such group at such time (the term “representative
member” to have the same meaning as in the Value Added Tax Act 1994).

This Section 2.18A shall be deemed to constitute an integral part of
Section 2.18 and cross-references to Section 2.18 shall be deemed to reference
such Section and this Section 2.18A, taken together.

SECTION 2.19. Payments Generally; Allocation of Proceeds; Sharing of Set-offs.
(a) Each Borrower shall make each payment required to be made by it hereunder
(whether of principal, interest, fees or reimbursement of LC Disbursements, or
of amounts payable under Section 2.16, 2.17 or

 

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2.18, or otherwise) prior to (i) in the case of payments denominated in Dollars
by the Company, 3:00 p.m., New York City time, and (ii) in the case of payments
denominated in a Foreign Currency or by a Foreign Subsidiary Borrower, 12:00
noon, Local Time, in the city of the Administrative Agent’s Eurocurrency Payment
Office for such currency, in each case, on the date when due, in immediately
available funds, without 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 (i) in the same
currency in which the applicable Credit Event was made (or where such currency
has been converted to euro, in euro) and (ii) to the Administrative Agent at its
offices at 270 Park Avenue, New York, New York 10017 or, in the case of a Credit
Event denominated in a Foreign Currency or to a Foreign Subsidiary Borrower, the
Administrative Agent’s Eurocurrency Payment Office for such currency, except
payments to be made directly to the Issuing Bank or Swingline Lender as
expressly provided herein and except that payments pursuant to Sections 2.16,
2.17, 2.18 and 9.03 shall be made directly to the Persons entitled thereto. The
Administrative Agent shall distribute any such payments denominated in the same
currency 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.
Notwithstanding the foregoing provisions of this Section, if, after the making
of any Credit Event in any Foreign Currency, currency control or exchange
regulations are imposed in the country which issues such currency with the
result that the type of currency in which the Credit Event was made (the
“Original Currency”) no longer exists or any Borrower is not able to make
payment to the Administrative Agent for the account of the Lenders in such
Original Currency, then all payments to be made by such Borrower hereunder in
such currency shall instead be made when due in Dollars in an amount equal to
the Dollar Amount (as of the date of repayment) of such payment due, it being
the intention of the parties hereto that the Borrowers take all risks of the
imposition of any such currency control or exchange regulations.

(b) Any proceeds of Collateral received by the Administrative Agent (i) not
constituting either (A) a specific payment of principal, interest, fees or other
sum payable under the Loan Documents (which shall be applied as specified by the
Company), (B) a mandatory prepayment (which shall be applied in accordance with
Section 2.12) or (C) amounts to be applied from any Collection Account (which
shall be applied in accordance with Section 2.11(b)) or (ii) after an Event of
Default has occurred and is continuing and the Administrative Agent so elects or
the Required Lenders so direct, such proceeds shall be applied ratably first, to
pay any fees, indemnities, or expense reimbursements including amounts then due
to the Administrative Agent and the Issuing Bank from any Borrower (other than
in connection with Banking Services Obligations or Swap Obligations), second, to
pay any fees or expense reimbursements then due to the Lenders from any Borrower
(other than in connection with Banking Services Obligations or Swap
Obligations), third, to pay interest due in respect of the Overadvances and
Protective Advances, fourth, to pay the principal of the Overadvances and
Protective Advances, fifth, to pay interest then due and payable on the Loans
(other than the Overadvances and Protective Advances) ratably, sixth, to prepay
principal on the Loans (other than the Overadvances and Protective Advances) and
unreimbursed LC Disbursements ratably, seventh, to pay an amount to the
Administrative Agent equal to one hundred five percent (105%) of the aggregate
undrawn face amount of all outstanding Letters of Credit and the aggregate drawn
amount of Letters of Credit with respect to which an LC Disbursement has not yet
been made, to be held as cash collateral for such Obligations, eighth, to
payment of any amounts owing with respect to Banking Services Obligations and
Swap Obligations (other than Banking Services Obligations or Swap Obligations
owing to a Lender or Affiliate thereof that has failed to comply with
Section 2.25 hereof), ninth, to payment of any amounts owing with respect to
Banking Services Obligations and Swap Obligations that have not been paid
pursuant to the preceding clause eighth, and tenth, to the payment of any other
Secured Obligation due to the Administrative Agent or any Lender by any

 

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Borrower. Notwithstanding anything to the contrary contained in this Agreement,
unless so directed by the Company, or unless a Default is in existence, neither
the Administrative Agent nor any Lender shall apply any payment which it
receives to any Eurocurrency Loan of a Class, except (a) on the expiration date
of the Interest Period applicable to any such Eurocurrency Loan or (b) in the
event, and only to the extent, that there are no outstanding ABR Loans of the
same Class and, in any such event, the Borrowers shall pay the break funding
payment required in accordance with Section 2.17. The Administrative Agent and
the Lenders shall have the continuing and exclusive right to apply and reverse
and reapply any and all such proceeds and payments to any portion of the Secured
Obligations. Notwithstanding the foregoing, any such applicable of proceeds from
Collateral securing solely the Foreign Secured Obligations shall be made solely
in respect of the Foreign Secured Obligations.

(c) At the election of the Administrative Agent, all payments of principal,
interest, LC Disbursements, fees, premiums, reimbursable expenses (including,
without limitation, all reimbursement for fees and expenses pursuant to
Section 9.03), and other sums payable under the Loan Documents, may be paid from
the proceeds of Borrowings made hereunder whether made following a request by a
Borrower (or the Borrower Representative on behalf of a Borrower) pursuant to
Section 2.03 or a deemed request as provided in this Section or may be deducted
from any deposit account of such Borrower maintained with the Administrative
Agent. Each Borrower hereby irrevocably authorizes (i) the Administrative Agent
to make a Borrowing for the purpose of paying each payment of principal,
interest and fees as it becomes due hereunder or any other amount due under the
Loan Documents and agrees that all such amounts charged shall constitute Loans
(including Swingline Loans and Overadvances, but such a Borrowing may only
constitute a Protective Advance if it is to reimburse costs, fees and expenses
as described in Section 9.03) and that all such Borrowings shall be deemed to
have been requested pursuant to Sections 2.03, 2.05 or 2.06, as applicable and
(ii) the Administrative Agent to charge any deposit account of the relevant
Borrower maintained with the Administrative Agent for each payment of principal,
interest and fees as it becomes due hereunder or any other amount due under the
Loan Documents.

(d) If any Lender shall, by exercising any right of set off or counterclaim or
otherwise, obtain payment in respect of any principal of or interest on any of
its Loans or participations in LC Disbursements resulting in such Lender
receiving payment of a greater proportion of the aggregate amount of its Loans
and participations in LC Disbursements 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 Loans
and participations in LC Disbursements 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 Loans and participations in LC Disbursements; 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 shall not be construed to
apply to any payment made by any 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 LC Disbursements to any assignee or participant,
other than to the Company or any Subsidiary or Affiliate thereof (as to which
the provisions of this paragraph shall apply). Each Borrower consents to the
foregoing and agrees, to the extent it may effectively do so under applicable
law, that any Lender acquiring a participation pursuant to the foregoing
arrangements may exercise against such Borrower rights of set-off and
counterclaim with respect to such participation as fully as if such Lender were
a direct creditor of such Borrower in the amount of such participation.

 

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(e) Unless the Administrative Agent shall have received notice from the relevant
Borrower prior to the date on which any payment is due to the Administrative
Agent for the account of the Lenders or the Issuing Bank hereunder that such
Borrower will not make such payment, the Administrative Agent may assume that
such Borrower has made such payment on such date in accordance herewith and may,
in reliance upon such assumption, distribute to the Lenders or the Issuing Bank,
as the case may be, the amount due. In such event, if such Borrower has not in
fact made such payment, then each of the Lenders or the Issuing Bank, as the
case may be, severally agrees to repay to the Administrative Agent forthwith on
demand the amount so distributed to such Lender or Issuing Bank with interest
thereon, for each day from and including the date such amount is distributed to
it to but excluding the date of payment to the 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 (including, without limitation, the Overnight LIBO Rate in the case
of Loans denominated in a Foreign Currency).

(f) If any Lender shall fail to make any payment required to be made by it
pursuant to Section 2.06, 2.07(d) or (e), 2.08(b), 2.19(e) or 9.03(c), then the
Administrative Agent may, in its discretion (notwithstanding any contrary
provision hereof), (i) apply any amounts thereafter received by the
Administrative Agent for the account of such Lender and for the benefit of the
Administrative Agent, the Swingline Lender or the Issuing Bank to satisfy such
Lender’s obligations under such Sections until all such unsatisfied obligations
are fully paid and/or (ii) hold any such amounts in a segregated account as cash
collateral for, and application to, any future funding obligations of such
Lender under such Sections; in the case of each of (i) and (ii) above, in any
order as determined by the Administrative Agent in its discretion.

SECTION 2.20. Mitigation Obligations; Replacement of Lenders.

(a) If any Lender requests compensation under Section 2.16, or if any Borrower
is required to pay any additional amount to any Lender or any Governmental
Authority for the account of any Lender pursuant to Section 2.18, 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 judgment
of such Lender, such designation or assignment (i) would eliminate or reduce
amounts payable pursuant to Section 2.16 or 2.18, as the case may be, in the
future and (ii) would not subject such Lender to any unreimbursed cost or
expense and would not otherwise be disadvantageous to such Lender. The Company
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 2.16, or if any Borrower
is required to pay any additional amount to any Lender or any Governmental
Authority for the account of any Lender pursuant to Section 2.18, or if any
Lender becomes a Defaulting Lender, then the Company 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 Company shall have received the prior written
consent of the Administrative Agent (and if a Commitment is being assigned, the
Issuing Bank), 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 LC 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 Company (in the case of all other amounts) and
(iii) in the case of any such assignment resulting from a claim for

 

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compensation under Section 2.16 or payments required to be made pursuant to
Section 2.18, such assignment will result in a reduction in such compensation or
payments. A Lender shall not be required to make any such assignment and
delegation if, prior thereto, as a result of a waiver by such Lender or
otherwise, the circumstances entitling the Company to require such assignment
and delegation cease to apply.

SECTION 2.21. Defaulting Lenders. Notwithstanding any provision of this
Agreement to the contrary, if any Lender becomes a Defaulting Lender, then the
following provisions shall apply for so long as such Lender is a Defaulting
Lender:

(a) fees shall cease to accrue on the unfunded portion of the Commitment of such
Defaulting Lender pursuant to Section 2.13(a);

(b) such Defaulting Lender shall not have the right to vote on any issue on
which voting is required (other than to the extent expressly provided in
Section 9.02(b)) and the Commitment and Revolving Exposure of such Defaulting
Lender shall not be included in determining whether the Required Lenders have
taken or may take any action hereunder;

(c) if any Swingline Exposure or LC Exposure exists at the time a Lender becomes
a Defaulting Lender then:

(i) all or any part of the Swingline Exposure and LC Exposure of such Defaulting
Lender shall be reallocated among the non-Defaulting Lenders in accordance with
their respective Applicable Percentages but only to the extent the sum of all
non-Defaulting Lenders’ Revolving Exposures plus such Defaulting Lender’s
Swingline Exposure and LC Exposure does not exceed the total of all
non-Defaulting Lenders’ Commitments; and

(ii) if the reallocation described in clause (i) above cannot, or can only
partially, be effected, the Borrowers shall within one (1) Business Day
following notice by the Administrative Agent (x) first, prepay such Swingline
Exposure and (y) second, cash collateralize, for the benefit of the Issuing
Bank, the Borrowers’ obligations corresponding to such Defaulting Lender’s LC
Exposure (after giving effect to any partial reallocation pursuant to clause
(i) above) in accordance with the procedures set forth in Section 2.07(j) for so
long as such LC Exposure is outstanding;

(iii) if the Borrowers cash collateralize any portion of such Defaulting
Lender’s LC Exposure pursuant to clause (ii) above, the Borrowers shall not be
required to pay any fees to such Defaulting Lender pursuant to Section 2.13(b)
with respect to such Defaulting Lender’s LC Exposure during the period such
Defaulting Lender’s LC Exposure is cash collateralized;

(iv) if the LC Exposure of the non-Defaulting Lenders is reallocated pursuant to
clause (i) above, then the fees payable to the Lenders pursuant to
Section 2.13(a) and Section 2.13(b) shall be adjusted in accordance with such
non-Defaulting Lenders’ Applicable Percentages; and

(v) if all or any portion of such Defaulting Lender’s LC Exposure is neither
cash collateralized nor reallocated pursuant to clause (i) or (ii) above, then,
without prejudice to any rights or remedies of the Issuing Bank or any Lender
hereunder, all letter of credit fees payable under Section 2.13(b) with respect
to such Defaulting Lender’s LC Exposure shall be payable to the Issuing Bank
until such LC Exposure is cash collateralized and/or reallocated; and

 

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(d) so long as such Lender is a Defaulting Lender, the Issuing Bank shall not be
required to issue, amend or increase any Letter of Credit, unless it is
satisfied that the related exposure will be 100% covered by the Commitments of
the non-Defaulting Lenders and/or cash collateral will be provided by the
Borrowers in accordance with Section 2.21(c), and participating interests in any
such newly issued or increased Letter of Credit or in any newly made Swingline
Loan shall be allocated among non-Defaulting Lenders in a manner consistent with
Section 2.21(c)(i) (and such Defaulting Lender shall not participate therein).

If (i) a Bankruptcy Event with respect to the Parent of any Lender shall occur
following the date hereof and for so long as such event shall continue or
(ii) the Issuing Bank or the Swingline Lender has a good faith belief that any
Lender has defaulted in fulfilling its obligations under one or more other
agreements in which such Lender commits to extend credit, the Issuing Bank shall
not be required to issue, amend or increase any Letter of Credit and the
Swingline Lender shall not be required to fund any Swingline Loan, unless the
Issuing Bank or the Swingline Lender, as the case may be, shall have entered
into arrangements with the Borrowers or such Lender, satisfactory to the Issuing
Bank or the Swingline Lender, as the case may be, to defease any risk in respect
of such Lender hereunder.

In the event that the Administrative Agent, the Borrowers, the Issuing Bank and
the Swingline Lender each agrees that a Defaulting Lender has adequately
remedied all matters that caused such Lender to be a Defaulting Lender, then the
Swingline Exposure and LC Exposure of the Lenders shall be readjusted to reflect
the inclusion of such Lender’s Commitment and, on the date of such readjustment,
such Lender shall purchase at par such of the Loans of the other Lenders (other
than Swingline Loans) as the Administrative Agent shall determine may be
necessary in order for such Lender to hold such Loans in accordance with its
Applicable Percentage.

SECTION 2.22. Returned Payments. If after receipt of any payment which is
applied to the payment of all or any part of the Obligations, the Administrative
Agent or any Lender is for any reason compelled to surrender such payment or
proceeds to any Person because such payment or application of proceeds is
invalidated, declared fraudulent, set aside, determined to be void or voidable
as a preference, impermissible setoff, or a diversion of trust funds, or for any
other reason, then the Obligations or part thereof intended to be satisfied
shall be revived and continued and this Agreement shall continue in full force
as if such payment or proceeds had not been received by the Administrative Agent
or such Lender. The provisions of this Section 2.22 shall be and remain
effective notwithstanding any contrary action which may have been taken by the
Administrative Agent or any Lender in reliance upon such payment or application
of proceeds. The provisions of this Section 2.22 shall survive the termination
of this Agreement.

SECTION 2.23. Judgment Currency. If for the purposes of obtaining judgment in
any court it is necessary to convert a sum due from any Borrower hereunder in
the currency expressed to be payable herein (the “specified currency”) into
another currency, the parties hereto agree, to the fullest extent that they may
effectively do so, that the rate of exchange used shall be that at which in
accordance with normal banking procedures the Administrative Agent could
purchase the specified currency with such other currency at the Administrative
Agent’s main New York City office on the Business Day preceding that on which
final, non-appealable judgment is given. The obligations of each Borrower in
respect of any sum due to any Lender or the Administrative Agent hereunder
shall, notwithstanding any judgment in a currency other than the specified
currency, be discharged only to the extent that on the Business Day following
receipt by such Lender or the Administrative Agent (as the case may be) of any
sum adjudged to be so due in such other currency such Lender or the
Administrative Agent (as the case may be) may in accordance with normal,
reasonable banking procedures purchase the specified currency with such other
currency. If the amount of the specified currency so purchased is less than the
sum originally due to such Lender or the Administrative Agent, as the case may
be, in the specified currency,

 

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each Borrower agrees, to the fullest extent that it may effectively do so, as a
separate obligation and notwithstanding any such judgment, to indemnify such
Lender or the Administrative Agent, as the case may be, against such loss, and
if the amount of the specified currency so purchased exceeds (a) the sum
originally due to any Lender or the Administrative Agent, as the case may be, in
the specified currency and (b) any amounts shared with other Lenders as a result
of allocations of such excess as a disproportionate payment to such Lender under
Section 2.19, such Lender or the Administrative Agent, as the case may be,
agrees to remit such excess to such Borrower.

SECTION 2.24. Designation of Foreign Subsidiary Borrowers. The Company may at
any time and from time to time designate any Approved Foreign Subsidiary as a
Foreign Subsidiary Borrower by delivery to the Administrative Agent of a
Borrowing Subsidiary Agreement executed by such Subsidiary and the Company and
the satisfaction of the other conditions precedent set forth in Section 4.03,
and upon such delivery and satisfaction such Subsidiary shall for all purposes
of this Agreement be a Foreign Subsidiary Borrower and a party to this Agreement
until the Company shall have executed and delivered to the Administrative Agent
a Borrowing Subsidiary Termination with respect to such Subsidiary, whereupon
such Subsidiary shall cease to be a Foreign Subsidiary Borrower and a party to
this Agreement. Notwithstanding the preceding sentence, no Borrowing Subsidiary
Termination will become effective as to any Foreign Subsidiary Borrower at a
time when any principal of or interest on any Loan to such Borrower or Letter of
Credit (unless the same is cash collateralized by such Borrower in an amount not
to exceed 105% of the Dollar Amount of the corresponding LC Exposure and on
terms reasonably satisfactory to the Administrative Agent) shall be outstanding
hereunder, provided that such Borrowing Subsidiary Termination shall be
effective to terminate the right of such Foreign Subsidiary Borrower to make
further Borrowings under this Agreement. As soon as practicable upon receipt of
a Borrowing Subsidiary Agreement, the Administrative Agent shall furnish a copy
thereof to each Lender.

SECTION 2.25. Banking Services Obligations and Swap Obligations. Each Lender
(other than Chase) or Affiliate thereof providing Banking Services to, or party
to any Swap Agreement with, any Loan Party shall promptly (but, in any event, no
later than five (5) Business Days after providing such services) deliver to the
Administrative Agent written notice setting forth the aggregate amount of all
Banking Services Obligations and Swap Obligations owing to such Lender or
Affiliate (whether matured or unmatured, absolute or contingent).

ARTICLE III

Representations and Warranties

Each Loan Party represents and warrants to the Lenders that:

SECTION 3.01. Organization; Powers. Each of the Loan Parties and each of its
Subsidiaries is duly organized, validly existing and in good standing under the
laws of the jurisdiction of its organization, has all requisite power and
authority to carry on its business as now conducted, except where the failure to
do so, individually or in the aggregate, could not reasonably be expected to
result in a Material Adverse Effect, and is qualified to do business in, and is
in good standing in, every jurisdiction where such qualification is required,
except where the failure to do so, individually or in the aggregate, could not
reasonably be expected to result in a Material Adverse Effect. Each Foreign
Subsidiary Borrower that is incorporated in a jurisdiction in the European Union
represents and warrants to the Lenders that its centre of main interest (as that
term is used in Article 3(1) of the Regulation) is in its jurisdiction of
incorporation and it has no Establishment in any other jurisdiction.

 

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SECTION 3.02. Authorization; Enforceability. The Transactions are within each
Loan Party’s organizational powers and have been duly authorized by all
necessary organizational actions and, if required, actions by equity holders.
The Loan Documents to which each Loan Party is a party have been duly executed
and delivered by such Loan Party and constitute a legal, valid and binding
obligation of such Loan Party, enforceable in accordance with its terms, subject
to applicable bankruptcy, insolvency, reorganization, moratorium or other laws
affecting creditors’ rights generally and subject to general principles of
equity, regardless of whether considered in a proceeding in equity or at law.

SECTION 3.03. Governmental Approvals; No Conflicts. The Transactions (a) do not
require any consent or approval of, registration or filing with, or any other
action by, any Governmental Authority, except such as have been obtained or made
and are in full force and effect and except for filings necessary to perfect
Liens created pursuant to the Loan Documents, (b) will not violate any
Requirement of Law applicable to any Loan Party or any of its Subsidiaries,
(c) will not violate or result in a default under any indenture, agreement or
other instrument binding upon any Loan Party or any of its Subsidiaries or its
assets, or give rise to a right thereunder to require any payment to be made by
any Loan Party or any of its Subsidiaries, and (d) will not result in the
creation or imposition of any Lien on any asset of any Loan Party or any of its
Subsidiaries, except Liens created pursuant to the Loan Documents.

SECTION 3.04. Financial Condition; No Material Adverse Change. (a) The Company
has heretofore furnished to the Lenders (i) its annual report or Form 10-K,
which contains the Company’s consolidated balance sheet and statements of
income, stockholders equity and cash flows as of and for the fiscal year ended
December 31, 2010, reported on by Ernst & Young LLP, independent public
accountants, and (ii) its quarterly report or Form 10-Q, which contains the
Company’s consolidated balance sheet and statements of income, stockholders
equity and cash flows as of and for the fiscal quarter ended June 30, 2011,
certified by its chief financial officer. Such financial statements present
fairly, in all material respects, the financial position and results of
operations and cash flows of the Company and its consolidated Subsidiaries as of
such dates and for such periods in accordance with GAAP, subject to year end
audit adjustments and the absence of footnotes in the case of the statements
referred to in clause (ii) above.

(b) No event, change or condition has occurred that has had, or could reasonably
be expected to have, a Material Adverse Effect, since December 31, 2010.

SECTION 3.05. Properties. (a) As of the date of this Agreement, Schedule 3.05
sets forth the address of each parcel of real property that is owned or leased
by each Loan Party. Each of such leases and subleases is valid and enforceable
in accordance with its terms and is in full force and effect, and no default by
any party to any such lease or sublease exists which could result in the
termination of such lease or sublease in accordance with its terms. Each of the
Loan Parties and its Subsidiaries has good and indefeasible title to, or valid
leasehold interests in, all its real and personal property, free of all Liens
other than those permitted by Section 6.02.

(b) Each Loan Party and its Subsidiaries owns, or is licensed to use, all
trademarks, tradenames, copyrights, patents and other intellectual property
necessary to its business as currently conducted, and the use thereof by the
Loan Parties and its Subsidiaries does not infringe in any material respect upon
the rights of any other Person, and the Loan Parties’ rights thereto are not
subject to any licensing agreement or similar arrangement.

SECTION 3.06. Litigation and Environmental Matters. (a) Except as set forth in
Schedule 3.06, there are no actions, suits, proceedings or investigations by or
before any arbitrator or Governmental Authority pending against or, to the
knowledge of any Loan Party, threatened against or affecting the Loan Parties or
any of their Subsidiaries (i) as to which there is a reasonable possibility of
an adverse determination and that, if adversely determined, could reasonably be
expected, individually or in the aggregate, to result in a Material Adverse
Effect (other than the Disclosed Matters) or (ii) that involve this Agreement or
the Transactions.

 

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(b) Except for the Disclosed Matters (i) no Loan Party nor any of its
Subsidiaries has received notice of any claim with respect to any Environmental
Liability or knows of any basis for any Environmental Liability and (ii) except
with respect to any other matters that, individually or in the aggregate, could
not reasonably be expected to result in a Material Adverse Effect, no Loan Party
nor any of its Subsidiaries (1) has failed to comply with any Environmental Law
or to obtain, maintain or comply with any permit, license or other approval
required under any Environmental Law or (2) has become subject to any
Environmental Liability.

(c) Since the date of this Agreement, there has been no change in the status of
the Disclosed Matters that, individually or in the aggregate, has resulted in,
or materially increased the likelihood of, a Material Adverse Effect.

SECTION 3.07. Compliance with Laws and Agreements. Each Loan Party and its
Subsidiaries is in compliance with all Requirements of Law applicable to it or
its property and all indentures, agreements and other instruments binding upon
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. No Default has occurred and is continuing.

SECTION 3.08. Investment Company Status. No Loan Party nor any of its
Subsidiaries is an “investment company” as defined in, or subject to regulation
under, the Investment Company Act of 1940.

SECTION 3.09. Taxes. Each Loan Party and its Subsidiaries has timely filed or
caused to be filed all Tax returns and reports required to have been filed and
has paid or caused to be paid all Taxes required to have been paid by it, except
(a) Taxes that are being contested in good faith by appropriate proceedings and
for which such Loan Party or such Subsidiary, as applicable, has set aside on
its books adequate reserves or (b) to the extent that the failure to do so could
not be expected to result in a Material Adverse Effect. No tax liens have been
filed and no claims are being asserted with respect to any such taxes.

SECTION 3.10. ERISA; Non-U.S. Pension Plans.

(a) No ERISA Event has occurred or is reasonably expected to occur that, when
taken together with all other such ERISA Events for which liability is
reasonably expected to occur, could reasonably be expected to result in a
Material Adverse Effect.

(b) Each Non-U.S. Pension Plan is in compliance with all requirements of law
applicable thereto and the respective requirements of the governing documents
for such plan except to the extent such non-compliance could not reasonably be
expected to result in a Material Adverse Effect. With respect to each Non-U.S.
Pension Plan, none of the Company, its Affiliates or any of their directors,
officers, employees or agents has engaged in a transaction, or other act or
omission (including entering into this Agreement and any act done or to be done
in connection with this Agreement), that has subjected, or could reasonably be
expected to subject, the Company or any of its Subsidiaries, directly or
indirectly, to any penalty (including any tax or civil penalty), fine, claim or
other liability (including any liability under a Contribution Notice or
Financial Support Direction, or any liability or amount payable under Section 75
or 75A of the United Kingdom Pensions Act 1995), that could reasonably be
expected, individually or in the aggregate, to have a Material Adverse Effect
and there are no facts or circumstances which could reasonably be expected to
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penalty, fine, claim, or other liability. With respect to each Non-U.S. Pension
Plan, reserves have been established in the financial statements furnished to
Lenders in respect of any unfunded liabilities in accordance with applicable law
or, where required, in accordance with ordinary accounting practices in the
jurisdiction in which such Non-U.S. Pension Plan is maintained. The aggregate
unfunded liabilities, with respect to such Non-U.S. Pension Plans could not
reasonably be expected to result in a Material Adverse Effect.

SECTION 3.11. Disclosure. The Company has disclosed to the Lenders all
agreements, instruments and corporate or other restrictions to which it or any
Subsidiary is subject, and all other matters known to it, that, individually or
in the aggregate, could reasonably be expected to result in a Material Adverse
Effect. None of the reports, financial statements, certificates or other
information furnished by or on behalf of the any Loan Party to the
Administrative Agent or any Lender in connection with the negotiation of this
Agreement or any other Loan Document (as modified or supplemented by other
information so furnished) contains any material misstatement of fact or omits to
state any material fact necessary to make the statements therein, in the light
of the circumstances under which they were made, not misleading; provided that,
with respect to projected financial information, the Company represents only
that such information was prepared in good faith based upon assumptions believed
to be reasonable at the time delivered and, if such projected financial
information was delivered prior to the Effective Date, as of the Effective Date.

SECTION 3.12. Material Agreements. No Loan Party is in default in the
performance, observance or fulfillment of any of the obligations, covenants or
conditions contained in (i) any material agreement or contract to which it is a
party or (ii) any agreement or instrument evidencing or governing Indebtedness.

SECTION 3.13. Solvency. (a) Immediately after the consummation of the
Transactions to occur on the Effective Date, (i) the fair value of the assets of
each Loan Party, at a fair valuation, will exceed its debts and liabilities,
subordinated, contingent or otherwise; (ii) the present fair saleable value of
the property of each Loan Party will be greater than the amount that will be
required to pay the probable liability of its debts and other liabilities,
subordinated, contingent or otherwise, as such debts and other liabilities
become absolute and matured; (iii) each Loan Party will be able to pay its debts
and liabilities, subordinated, contingent or otherwise, as such debts and
liabilities become absolute and matured; and (iv) each Loan Party will not have
unreasonably small capital with which to conduct the business in which it is
engaged as such business is now conducted and is proposed to be conducted after
the Effective Date.

(b) No Loan Party intends to, or will permit any of its Subsidiaries to, and no
Loan Party believes that it or any of its Subsidiaries will, incur debts beyond
its ability to pay such debts as they mature, taking into account the timing of
and amounts of cash to be received by it or any such Subsidiary and the timing
of the amounts of cash to be payable on or in respect of its Indebtedness or the
Indebtedness of any such Subsidiary.

SECTION 3.14. Insurance. Schedule 3.14 sets forth a description of all insurance
maintained by or on behalf of the Loan Parties and the Subsidiaries as of the
Effective Date. As of the Effective Date, all premiums in respect of such
insurance have been paid. The Borrowers believe that the insurance maintained by
or on behalf of the Company and the Subsidiaries is adequate.

SECTION 3.15. Capitalization and Subsidiaries. Schedule 3.15 sets forth (a) a
correct and complete list of the name and relationship to the Company of each
and all of the Company’s Subsidiaries, (b) a true and complete listing of each
class of each of the Company’s authorized Equity Interests, of which all of such
issued shares are validly issued, outstanding, fully paid and non-assessable,

 

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and (c) the type of entity of the Company and each of its Subsidiaries. All of
the issued and outstanding Equity Interests owned by any Loan Party have been
(to the extent such concepts are relevant with respect to such ownership
interests) duly authorized and issued and are fully paid and non assessable.

SECTION 3.16. No Burdensome Restrictions. No Loan Party is subject to any
Burdensome Restrictions except Burdensome Restrictions permitted under
Section 6.10.

SECTION 3.17. Federal Reserve Regulations. Neither the Company nor any of its
Subsidiaries is engaged principally, or as one of its important activities, in
the business of extending credit for the purpose of purchasing or carrying
Margin Stock. No part of the proceeds of any Loan have been used or will be
used, whether directly or indirectly, for any purpose that entails a violation
of any of the regulations of the Board, including Regulations T, U and X.

SECTION 3.18. Security Interest in Collateral. The provisions of this Agreement
and the other Loan Documents create legal and valid Liens on all the Collateral
in favor of the Administrative Agent, for the benefit of the Administrative
Agent and the Lenders, and such Liens constitute perfected and continuing Liens
on the Collateral, securing the Secured Obligations or Foreign Secured
Obligations (as applicable), enforceable against the applicable Loan Party and
all third parties, and having priority over all other Liens on the Collateral
except in the case of (a) the Specified Assets, for which the Administrative
Agent shall have priority over all other Liens other than those created under
the Second Lien Documents and those described in clauses (b) and (c) of this
Section 3.18, (b) Permitted Encumbrances, to the extent any such Permitted
Encumbrances would have priority over the Liens in favor of the Administrative
Agent pursuant to any applicable law and (c) Liens perfected only by possession
(including possession of any certificate of title) to the extent the
Administrative Agent has not obtained or does not maintain possession of such
Collateral.

SECTION 3.19. Employment Matters. As of the Effective Date, there are no
strikes, lockouts or slowdowns against any Loan Party or any Subsidiary pending
or, to the knowledge of the Borrowers, threatened. The hours worked by and
payments made to employees of the Loan Parties and the Subsidiaries have not
been in violation of the Fair Labor Standards Act or any other applicable
Federal, state, local or foreign law dealing with such matters. All payments due
from any Loan Party or any Subsidiary, or for which any claim may be made
against any Loan Party 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 Loan Party or such Subsidiary.

SECTION 3.20. Common Enterprise. The successful operation and condition of each
of the Loan Parties is dependent on the continued successful performance of the
functions of the group of the Loan Parties as a whole and the successful
operation of each of the Loan Parties is dependent on the successful performance
and operation of each other Loan Party. Each Loan Party expects to derive
benefit (and its board of directors or other governing body has determined that
it may reasonably be expected to derive benefit), directly and indirectly, from
(i) successful operations of each of the other Loan Parties and (ii) the credit
extended by the Lenders to the Borrowers hereunder, both in their separate
capacities and as members of the group of companies. Each Loan Party has
determined that execution, delivery, and performance of this Agreement and any
other Loan Documents to be executed by such Loan Party is within its purpose,
will be of direct and indirect benefit to such Loan Party, and is in its best
interest.

 

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ARTICLE IV

Conditions

SECTION 4.01. Effective Date. The obligations of the Lenders to make Loans and
of the Issuing Bank to issue Letters of Credit hereunder shall not become
effective until the date on which each of the following conditions is satisfied
(or waived in accordance with Section 9.02):

(a) Credit Agreement and Loan Documents. The Administrative Agent (or its
counsel) shall have received (i) from each party hereto either (A) a counterpart
of this Agreement signed on behalf of such party or (B) written evidence
satisfactory to the Administrative Agent (which may include facsimile or PDF
transmission of a signed signature page of this Agreement) that such party has
signed a counterpart of this Agreement and (ii) duly executed copies of the Loan
Documents and such other certificates, documents, instruments and agreements as
the Administrative Agent shall reasonably request in connection with the
transactions contemplated by this Agreement and the other Loan Documents,
including any promissory notes requested by a Lender pursuant to Section 2.11
payable to the order of each such requesting Lender and a written opinion of the
Loan Parties’ counsel, addressed to the Administrative Agent, the Issuing Bank
and the Lenders in substantially the form of Exhibit B, all in form and
substance reasonably satisfactory to the Administrative Agent and its counsel
and as further described in the list of closing documents attached as Exhibit F.

(b) Closing Certificates; Certified Certificate of Incorporation; Good Standing
Certificates. The Administrative Agent shall have received (i) a certificate of
each Loan Party, dated the Effective Date and executed by its Secretary or
Assistant Secretary, which shall (A) certify the resolutions of its Board of
Directors, members or other body authorizing the execution, delivery and
performance of the Loan Documents to which it is a party, (B) identify by name
and title and bear the signatures of the Financial Officers and any other
officers of such Loan Party authorized to sign the Loan Documents to which it is
a party, and (C) contain appropriate attachments, including the certificate or
articles of incorporation or organization of each Loan Party certified by the
relevant authority of the jurisdiction of organization of such Loan Party and a
true and correct copy of its by laws or operating, management or partnership
agreement, and (ii) a good standing certificate for each Loan Party from its
jurisdiction of organization.

(c) No Default Certificate. The Administrative Agent shall have received a
certificate, signed by the chief financial officer of the Company, on the
initial Borrowing date (i) stating that no Default has occurred and is
continuing, (ii) stating that the representations and warranties contained in
Article III are true and correct as of such date, and (iii) certifying any other
factual matters as may be reasonably requested by the Administrative Agent.

(d) Fees. The Lenders and the Administrative Agent shall have received all fees
required to be paid, and all expenses for which invoices have been presented
(including the reasonable fees and expenses of legal counsel), on or before the
Effective Date. All such amounts will be paid with proceeds of Loans made on the
Effective Date and will be reflected in the funding instructions given by the
Company to the Administrative Agent on or before the Effective Date.

(e) Lien Searches. The Administrative Agent shall have received the results of a
recent lien search in each of the jurisdictions in which the initial Loan
Parties are organized, and such search shall reveal no liens on any of the
assets of the Loan Parties except for liens permitted by Section 6.02 or
discharged on or prior to the Effective Date pursuant to a pay-off letter or
other documentation reasonably satisfactory to the Administrative Agent.

 

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(f) Second Lien Financing. The Administrative Agent shall have received evidence
reasonably satisfactory to it that the administrative agent under the Second
Lien Documents shall have given its consent to the effectiveness of this
Agreement.

(g) Funding Account. The Administrative Agent shall have received a notice
setting forth the deposit account(s) of the Borrowers (the “Funding Accounts”)
to which the Administrative Agent is authorized by the Borrowers to transfer the
proceeds of any Borrowings requested or authorized pursuant to this Agreement.

(h) Solvency. The Administrative Agent shall have received a solvency
certificate from a Financial Officer.

(i) Closing Availability. After giving effect to all Borrowings to be made on
the Effective Date and the issuance of any Letters of Credit on the Effective
Date and payment of all fees and expenses due hereunder, and with all of the
Loan Parties’ indebtedness, liabilities, and obligations current, the
Availability shall not be less than $40,000,000.

(j) Filings, Registrations and Recordings. Each document (including any UCC
financing statement) required by the Collateral Documents or under law or
reasonably requested by the Administrative Agent to be filed, registered or
recorded in order to create in favor of the Administrative Agent, for the
benefit of the Secured Parties, a perfected Lien on the Collateral described
therein, prior and superior in right to any other Person (other than with
respect to Liens expressly permitted by Section 6.02), shall be in proper form
for filing, registration or recordation.

(k) Other Documents. The Administrative Agent shall have received such other
documents and information as the Administrative Agent, any Co-Collateral Agent,
the Issuing Bank, any Lender or their respective counsel may have reasonably
requested.

The Administrative Agent shall notify the Company and the Lenders of the
Effective Date, and such notice shall be conclusive and binding.

SECTION 4.02. Each Credit Event. The obligation of each Lender to make a Loan on
the occasion of any Borrowing, and of the Issuing Bank to issue, amend, renew or
extend any Letter of Credit, is subject to the satisfaction of the following
conditions:

(a) The representations and warranties of the Borrowers set forth in this
Agreement shall be true and correct on and as of the date of such Borrowing or
the date of issuance, amendment, renewal or extension of such Letter of Credit,
as applicable.

(b) At the time of and immediately after giving effect to such Borrowing or the
issuance, amendment, renewal or extension of such Letter of Credit, as
applicable, no Default shall have occurred and be continuing.

(c) After giving effect to any Borrowing or the issuance of any Letter of
Credit, Availability is not less than zero.

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

 

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Notwithstanding the failure to satisfy the conditions precedent set forth in
paragraphs (a) or (b) of this Section, unless otherwise directed by the Required
Lenders, the Administrative Agent may, but shall have no obligation to, continue
to make Loans and an Issuing Bank may, but shall have no obligation to, issue or
cause to be issued any Letter of Credit for the ratable account and risk of
Lenders from time to time if the Administrative Agent believes that making such
Loans or issuing or causing to be issued any such Letter of Credit is in the
best interests of the Lenders.

SECTION 4.03. Designation of a Foreign Subsidiary Borrower. The designation of a
Foreign Subsidiary Borrower pursuant to Section 2.24 is subject to the condition
precedent that the Company or such proposed Foreign Subsidiary Borrower shall
have furnished or caused to be furnished to the Administrative Agent:

(a) Copies, certified by the Secretary or Assistant Secretary of such
Subsidiary, of its Board of Directors’ resolutions (and resolutions of other
bodies, if any are deemed necessary by counsel for the Administrative Agent)
approving the Borrowing Subsidiary Agreement, this Agreement and any other Loan
Documents to which such Subsidiary is becoming a party and such documents and
certificates as the Administrative Agent or its counsel may reasonably request
relating to the organization, existence and good standing of such Subsidiary;

(b) An incumbency certificate, executed by the Secretary or Assistant Secretary
of such Subsidiary, which shall identify by name and title and bear the
signature of the officers of such Subsidiary authorized to request Borrowings
hereunder and sign the Borrowing Subsidiary Agreement, this Agreement and the
other Loan Documents to which such Subsidiary is becoming a party, upon which
certificate the Administrative Agent and the Lenders shall be entitled to rely
until informed of any change in writing by the Company or such Subsidiary;

(c) Opinions of counsel to such Subsidiary, in form and substance reasonably
satisfactory to the Administrative Agent and its counsel, with respect to the
laws of its jurisdiction of organization and such other matters as are
reasonably requested by counsel to the Administrative Agent and addressed to the
Administrative Agent and the Lenders;

(d) Any promissory notes requested by any Lender, and any other instruments and
documents reasonably requested by the Administrative Agent;

(e) A certificate, signed by the chief financial officer of such Subsidiary and
dated the applicable Foreign Subsidiary Borrower Effective Date, (i) stating
that no Default has occurred and is continuing, (ii) stating that the
representations and warranties contained in Article III are true and correct as
of such date, and (iii) certifying any other factual matters as may be
reasonably requested by the Administrative Agent;

(f) A notice from the Company setting forth the Funding Accounts of such
Subsidiary to which the Lenders are authorized to transfer the proceeds of any
Borrowings requested or authorized pursuant to this Agreement;

(g) Copies of such Foreign Security Agreements (and notices of security relating
to such agreements) as the Administrative Agent may request, duly executed by
such Subsidiary, and other evidence satisfactory to the Administrative Agent
that all filings and other actions have been taken for the Administrative Agent
to have a first priority perfected security interest in the Collateral of such
Subsidiary;

 

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(h) To the extent requested by the Administrative Agent, a true and complete
customer list of such Subsidiary as of the applicable Foreign Subsidiary
Borrower Effective Date, which list shall state each customer’s name, mailing
address and phone number and shall be certified as true by a Financial Officer
of the Company;

(i) A solvency certificate, dated the applicable Foreign Subsidiary Borrower
Effective Date, from a Financial Officer of such Subsidiary and the Company;

(j) A Borrowing Base Certificate calculating the Foreign Borrowing Base, as of a
date reasonably near but on or prior to the Foreign Subsidiary Borrower
Effective Date;

(k) All government and third party approvals in connection with the transaction
contemplated pursuant to this Section 4.03 with respect to such Subsidiary and
the Company shall have been obtained and be in full force and effect, and all
applicable waiting periods shall have expired without any action being taken or
threatened by any competent authority that would restrain, prevent or otherwise
impose adverse conditions with respect to the foregoing;

(l) Evidence of insurance coverage with respect to such Subsidiary, in form,
scope and substance evidencing compliance with the terms of any applicable Loan
Document;

(m) Each of the following, in form and substance satisfactory to, and to the
extent requested by, the Administrative Agent: (i) audited consolidated
financial statements of such Subsidiary and its Subsidiaries for their two most
recently ended fiscal years, (ii) unaudited interim consolidated financial
statements of such Subsidiary and its Subsidiaries for each fiscal month ended
after the date of the latest applicable financial statements delivered pursuant
to clause (i) of this paragraph as to which such financial statements are
available, (iii) monthly projections (including forecasts of Availability) of
such Subsidiary and its Subsidiaries for each fiscal month through the last
fiscal month of the then-current fiscal year and (iv) annual projections of such
Subsidiary and its Subsidiaries for the period ending on the Maturity Date;

(n) Such information, supporting documentation and other evidence regarding such
Subsidiary and its directors, authorized signing officers, direct or indirect
shareholders or other Persons in control thereof, and the transactions
contemplated hereby, as may be reasonably requested by the Administrative Agent
in order to comply with the requirements of the Act and any other applicable
anti-money laundering and know-your-customer laws;

(o) To the extent requested by the Administrative Agent, satisfactory appraisals
of Inventory and field exams from appraisers satisfactory to the Administrative
Agent;

(p) Any Collateral Access Agreements, Deposit Account Control Agreements or
other equivalent arrangements that are required to be provided pursuant to each
applicable Foreign Security Agreement of such Subsidiary;

(q) To the extent required by the terms of the applicable Foreign Security
Agreement of such Subsidiary or any other Collateral Document, the
Administrative Agent shall have received (i) the certificates representing the
Equity Interests that are required to be pledged pursuant thereto, together with
undated stock powers or stock transfer forms, as applicable, for each such
certificate executed in blank by a duly authorized officer of the pledgor
thereof and (ii) each promissory note (if any) required to be pledged pursuant
thereto;

 

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(r) Payoff documentation providing evidence that all existing credit facilities
of such Subsidiary have been terminated and cancelled, all Indebtedness
thereunder has been fully repaid and, to the extent available, the results of a
recent lien search report in each of the jurisdictions where assets of such
Subsidiary are located, and such search shall reveal no Liens on any of the
assets of such Subsidiary except for Liens permitted under Section 6.02 hereof;

(s) Payment of all fees required to be paid and all expenses for which invoices
have been presented (including, without limitation, the reasonable fees and
expenses of legal counsel), in each case, in connection with the designation of
such Subsidiary as a Foreign Subsidiary Borrower; and

(t) Such other documents and the Loan Parties shall have taken such other
actions, including entering into any amendments to this Agreement or any other
Loan Document, in each case, that the Administrative Agent may reasonably
request in order to give effect to the provisions contained in this Section 4.03
and/or which the Administrative Agent reasonably deems necessary to reflect
commercial or legal requirements in relation to such Subsidiary.

ARTICLE V

Affirmative Covenants

Until the Commitments have expired or been terminated and the principal of and
interest on each Loan and all fees payable hereunder shall have been paid in
full and all Letters of Credit shall have expired or terminated and all LC
Disbursements shall have been reimbursed, each Loan Party executing this
Agreement covenants and agrees with the Lenders that:

SECTION 5.01. Financial Statements; Borrowing Base and Other Information. The
Company will furnish to the Administrative Agent, the Co-Collateral Agents and
each Lender:

(a) within ninety (90) days after the end of each fiscal year of the Company,
its audited consolidated and unaudited consolidating balance sheet and related
statements of operations, stockholders’ equity and cash flows as of the end of
and for such year, setting forth in each case in comparative form the figures
for the previous fiscal year, all reported on (in the case of audited
statements) by Ernst & Young LLP or other independent public accountants of
recognized national standing (without a “going concern” or like qualification or
exception and without any qualification or exception as to the scope of such
audit) to the effect that such consolidated financial statements present fairly
in all material respects the financial condition and results of operations of
the Company and its consolidated Subsidiaries on a consolidated basis in
accordance with GAAP consistently applied;

(b) within forty-five (45) days after the end of each of the first three fiscal
quarters of the Company, its consolidated and consolidating balance sheet and
related statements of operations, stockholders’ equity and cash flows as of the
end of and for such fiscal quarter and the then elapsed portion of the fiscal
year, setting forth in each case in comparative form the figures for the
corresponding period or periods of (or, in the case of the balance sheet, as of
the end of) the previous fiscal year, all certified by one of its Financial
Officers as presenting fairly in all material respects the financial condition
and results of operations of the Company and its consolidated Subsidiaries on a
consolidated and consolidating basis in accordance with GAAP consistently
applied, subject to normal year-end audit adjustments and the absence of
footnotes;

 

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(c) within thirty (30) days after the end of each fiscal month of the Company,
excluding the months of January, March, June, September and December, its
consolidated and consolidating balance sheet and related statements of
operations, stockholders’ equity and cash flows as of the end of and for such
fiscal month and the then elapsed portion of the fiscal year, setting forth in
each case in comparative form the figures for the corresponding period or
periods of (or, in the case of the balance sheet, as of the end of) the previous
fiscal year, all certified by one of its Financial Officers as presenting fairly
in all material respects the financial condition and results of operations of
the Company and its consolidated Subsidiaries on a consolidated and
consolidating basis in accordance with GAAP consistently applied, subject to
normal year-end audit adjustments and the absence of footnotes;

(d) concurrently with any delivery of financial statements under clause (a),
(b) or (c) above, a certificate of a Financial Officer of the Company in
substantially the form of Exhibit D (i) certifying, in the case of the financial
statements delivered under clause (b) or (c), as presenting fairly in all
material respects the financial condition and results of operations of the
Company and its consolidated Subsidiaries on a consolidated basis in accordance
with GAAP consistently applied, subject to normal year-end audit adjustments and
the absence of footnotes, (ii) certifying as to whether a Default has occurred
and, if a Default has occurred, specifying the details thereof and any action
taken or proposed to be taken with respect thereto, (iii) setting forth
reasonably detailed calculations of the Fixed Charge Coverage Ratio for the most
recently ended four (4) fiscal quarters and, if applicable, demonstrating
compliance with Section 6.12 and (iv) stating whether any change in GAAP or in
the application thereof has occurred since the date of the audited financial
statements referred to in Section 3.04 and, if any such change has occurred,
specifying the effect of such change on the financial statements accompanying
such certificate;

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

(f) as soon as available, but in any event not later than the first Business Day
of each fiscal year of the Company, a copy of the plan and forecast (including a
projected consolidated and consolidating balance sheet, income statement and
funds flow statement) of the Company for each month of the upcoming fiscal year
(the “Projections”) in form reasonably satisfactory to the Administrative Agent;

(g) as soon as available but in any event within twenty (20) days of the end of
each calendar month (or within five (5) days of the end of each calendar week if
and for so long as Availability is less than $20,000,000), as of the period then
ended, a Borrowing Base Certificate and supporting information in connection
therewith, together with any additional reports with respect to the Domestic
Borrowing Base and the Foreign Borrowing Base;

(h) as soon as available but in any event within twenty (20) days of the end of
each calendar month (or within five (5) days of the end of each calendar week if
and for so long as Availability is less than $20,000,000) as of the period then
ended, all delivered electronically if such information then exists in
electronic format on the Company’s electronic information database:

(i) a detailed aging of each Loan Party’s Accounts (1) including all invoices
aged by invoice date and due date (with an explanation of the terms offered) and
(2) reconciled to the Borrowing Base Certificate delivered as of such date
prepared in a manner reasonably acceptable to the Administrative Agent and the
Co-Collateral Agents, together with the balance due for each Account Debtor, and
to the extent requested by the Administrative Agent, the name and address for
each Account Debtor;

 

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(ii) a schedule detailing each Loan Party’s Inventory (1) by location (showing
Inventory in transit, any Inventory located with a third party under any
consignment, bailee arrangement, or warehouse agreement), by class (raw
material, work-in-process and finished goods), by product type, and by quantity
on hand, which Inventory shall be valued at the lower of cost (determined on a
first-in, first-out basis) or market and adjusted for Reserves as the Co-
Collateral Agents have previously indicated to the Company are deemed by the
Co-Collateral Agents to be appropriate, (2) including a report of any variances
or other results of Inventory counts performed by such Loan Party since the last
Inventory schedule (including information regarding sales or other reductions,
additions, returns, credits issued by such Loan Party and complaints and claims
made against such Loan Party), and (3) reconciled to the Borrowing Base
Certificate delivered as of such date;

(iii) a schedule detailing each Loan Party’s Trademarks, indicating, to the
extent not previously reported, new trademark applications and registrations, in
form reasonably satisfactory to the Administrative Agent and the Co-Collateral
Agents, including any applicable registration number or application number with
the United States Patent and Trademark Office;

(iv) a reconciliation of each Loan Party’s Accounts, Inventory and Trademarks
between the amounts shown in such Loan Party’s general ledger and financial
statements and the reports delivered pursuant to clauses (i), (ii) and
(iii) above; and

(v) a reconciliation of the loan balance per each Loan Party’s general ledger to
the loan balance under this Agreement;

(i) as soon as available but in any event within twenty (20) days of the end of
each calendar month, as of the month then ended, a schedule and aging of each
Loan Party’s accounts payable, delivered electronically;

(j) as soon as available but in any event within forty-five (45) days of the end
of each fiscal year of the Company, as of the end of the most recently ended
fiscal year of the Company, a list of all customer addresses, delivered
electronically;

(k) promptly after the same become publicly available, copies of all periodic
and other reports, proxy statements and other materials filed by the Company or
any Subsidiary with the Securities and Exchange Commission, or any Governmental
Authority succeeding to any or all of the functions of said Commission, or with
any national securities exchange, or distributed by the Company to its
shareholders generally, as the case may be;

(l) as soon as possible and in any event within three (3) Business Days of
obtaining knowledge thereof: (i) any investigation or proposed investigation by
the Pensions Regulator which may lead to the issuance of a Financial Support
Direction or a Contribution Notice in relation to any Non-U.S. Pension Plan,
(ii) any amount is due to any Non-U.S. Pension Plan pursuant to Section 75 or
75A of the United Kingdom Pensions Act 1995, (iii) an amount becomes payable
under Section 75 or 75A of the United Kingdom Pensions Act 1995, in each case
describing such matter or event and the action which the Company or relevant
Loan Party proposes to take with respect thereto and/or (iv) any material change
to the rate or basis of the employer contributions to a Non-U.S. Pension Plan;
and

(m) promptly following any request therefor, such other information regarding
the operations, business affairs and financial condition of the Company or any
Subsidiary, or compliance with the terms of this Agreement, as the
Administrative Agent, the Co-Collateral Agents or any Lender may reasonably
request.

 

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Documents required to be delivered pursuant to clauses (a) and (b) of this
Section 5.01 may be delivered electronically and if so delivered, shall be
deemed to have been delivered on the date on which such documents are filed for
public availability on the Securities and Exchange Commission’s Electronic Data
Gathering and Retrieval System; provided that the Company shall notify (which
may be by facsimile or electronic mail) the Administrative Agent of the filing
of any such documents and provide to the Administrative Agent by electronic mail
electronic versions (i.e., soft copies) of such documents.

SECTION 5.02. Notices of Material Events. The Company will furnish to the
Administrative Agent and each Lender prompt written notice of the following:

(a) the occurrence of any Default;

(b) receipt of any notice of any governmental investigation or any litigation or
proceeding commenced or threatened against any Loan Party that (i) seeks damages
in excess of $5,000,000, (ii) seeks injunctive relief, (iii) is asserted or
instituted against any Plan, its fiduciaries or its assets, (iv) alleges
criminal misconduct by any Loan Party, (v) alleges the violation of any law
regarding, or seeks remedies in connection with, any Environmental Laws,
(vi) contests any tax, fee, assessment, or other governmental charge in excess
of $5,000,000, or (vii) involves any material product recall;

(c) any Lien (other than Permitted Encumbrances) or claim made or asserted
against any of the Collateral;

(d) any loss, damage, or destruction to the Collateral in the amount of
$5,000,000 or more, whether or not covered by insurance;

(e) any notice of default giving right of termination received under or with
respect to any leased location or public warehouse where Collateral is located
(which shall be delivered within five (5) Business Days after receipt thereof at
the Company’s corporate offices);

(f) (i) the occurrence of any ERISA Event that, alone or together with any other
ERISA Events that have occurred, could reasonably be expected to result in
liability of the Company and its Subsidiaries in an aggregate amount exceeding
$5,000,000 or (ii) the occurrence of any of the following to the extent the same
could reasonably be expected to result in a Material Adverse Effect:
(A) issuance by the Pensions Regulator of a Financial Support Direction or a
Contribution Notice in relation to any Non-U.S. Pension Plan or a warning notice
in respect thereof, (B) any amount is due to any Non-U.S. Pension Plan pursuant
to Section 75 or 75A of the United Kingdom Pensions Act 1995 and/or (C) an
amount becomes payable under Section 75 or 75A of the United Kingdom Pensions
Act 1995; and

(g) any other event or occurrence that results in, or could reasonably be
expected to result in, a Material Adverse Effect.

Each notice delivered under this Section shall be accompanied by a statement of
a Financial Officer or other executive officer of the Company setting forth the
details of the event or development requiring such notice and any action taken
or proposed to be taken with respect thereto.

SECTION 5.03. Existence; Conduct of Business. Each Loan Party will, and will
cause each Subsidiary to, (a) do or cause to be done all things necessary to
preserve, renew and keep in full force and effect its legal existence and the
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governmental authorizations, intellectual property rights, licenses and permits
material to the conduct of its business, and maintain all requisite authority to
conduct its business in each jurisdiction in which its business is conducted;
provided that the foregoing shall not prohibit any merger, consolidation,
liquidation or dissolution permitted under Section 6.03 and (b) carry on and
conduct its business in substantially the same manner and in substantially the
same fields of enterprise as it is presently conducted. Each Subsidiary
organized under the laws of a member state of the European Union shall cause its
registered office and centre of main interests (as that term is used in Article
3(1) of the Regulation) to be situated solely in its jurisdiction of
incorporation and shall have an Establishment situated solely in its
jurisdiction of incorporation.

SECTION 5.04. Payment of Obligations. Each Loan Party will, and will cause each
Subsidiary to, pay or discharge all Material Indebtedness and all other material
liabilities and obligations, including Taxes, before the same shall become
delinquent or in default, except where (a) the validity or amount thereof is
being contested in good faith by appropriate proceedings, (b) such Loan Party or
such Subsidiary has set aside on its books adequate reserves with respect
thereto in accordance with GAAP and (c) the failure to make payment pending such
contest could not reasonably be expected to result in a Material Adverse Effect.

SECTION 5.05. Maintenance of Properties. Each Loan Party will, and will cause
each Subsidiary to, keep and maintain all property material to the conduct of
its business in good working order and condition, ordinary wear and tear
excepted.

SECTION 5.06. Books and Records; Inspection Rights. Without limiting Sections
5.11 or 5.12 hereof, each Loan Party will, and will cause each Subsidiary to,
(i) keep proper books of record and account in which full, true and correct
entries are made of all dealings and transactions in relation to its business
and activities and (ii) permit any representatives designated by the
Administrative Agent or the Co-Collateral Agents (including employees of the
Administrative Agent, any Co-Collateral Agent or any consultants, accountants,
lawyers and appraisers retained by the Administrative Agent or the Co-
Collateral Agents), upon reasonable prior notice, to visit and inspect its
properties, to examine and make extracts from its books and records, and to
discuss its affairs, finances and condition with its officers and independent
accountants, all at such reasonable times and as often as reasonably requested.
The Loan Parties acknowledge that the Administrative Agent or the Co-Collateral
Agents, after exercising their rights of inspection, may prepare and distribute
to the Lenders certain Reports pertaining to the Loan Parties’ assets for
internal use by the Administrative Agent, the Co-Collateral Agents and the
Lenders.

SECTION 5.07. Compliance with Laws. Each Loan Party will, and will cause each
Subsidiary to, comply with all Requirements of Law 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.

SECTION 5.08. Use of Proceeds. The proceeds of the Loans will be used only
(i) to finance the payment of consideration for Permitted Acquisitions and
investments permitted under Section 6.04 and (ii) for working capital and
general corporate purposes of the Company and its Subsidiaries in the ordinary
course of business. No part of the proceeds of any Loan and no Letter of Credit
will be used, whether directly or indirectly, for any purpose that entails (x) a
violation of any of the regulations of the Board, including Regulations T, U and
X or (y) a violation of the applicable legislation governing financial
assistance as set forth in Section 5.15 hereof.

SECTION 5.09. Insurance. Each Loan Party will, and will cause each Subsidiary
to, maintain with financially sound and reputable carriers having a financial
strength rating of at least A- by A.M. Best Company (a) insurance in such
amounts (with no greater risk retention) and against such risks

 

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(including loss or damage by fire and loss in transit; theft, burglary,
pilferage, larceny, embezzlement, and other criminal activities; business
interruption; and general liability) and such other hazards, as is customarily
maintained by companies of established repute engaged in the same or similar
businesses operating in the same or similar locations and (b) all insurance
required pursuant to the Collateral Documents. The Company will furnish to the
Lenders, upon request of the Administrative Agent, information in reasonable
detail as to the insurance so maintained.

SECTION 5.10. Casualty and Condemnation. The Company (a) will furnish to the
Administrative Agent and the Lenders prompt written notice of any casualty or
other insured damage to any material portion of the Collateral or the
commencement of any action or proceeding for the taking of any material portion
of the Collateral or interest therein under power of eminent domain or by
condemnation or similar proceeding and (b) will ensure that the Net Proceeds of
any such event (whether in the form of insurance proceeds, condemnation awards
or otherwise) are collected and applied in accordance with the applicable
provisions of this Agreement and the Collateral Documents.

SECTION 5.11. Appraisals. Once during each period of twelve (12) consecutive
months (or, twice during each period of twelve (12) consecutive months if and
for so long as Availability is less than $20,000,000) or, if an Event of Default
has occurred and is continuing, at any time that the Administrative Agent or the
Co-Collateral Agents request, the Loan Parties will provide the Administrative
Agent and the Co-Collateral Agents with appraisals or updates thereof of their
Inventory and Trademarks from an appraiser selected and engaged by the
Administrative Agent or the Co-Collateral Agents, and prepared on a basis
reasonably satisfactory to the Administrative Agent and the Co-Collateral
Agents, such appraisals and updates to include, without limitation, information
required by applicable law and regulations. All such appraisals or updates shall
be at the sole expense of the Loan Parties.

SECTION 5.12. Field Examinations. Once during each period of twelve (12)
consecutive months (or, twice during each period of twelve (12) consecutive
months if and for so long as Availability is less than $20,000,000) or, if an
Event of Default has occurred and is continuing, at any time that the
Administrative Agent or the Co-Collateral Agents request, the Loan Parties will
permit, upon reasonable notice, the Administrative Agent or the Co-Collateral
Agents to conduct a field examination to ensure adequacy of Collateral included
in the Domestic Borrowing Base or Foreign Borrowing Base and related reporting
and control systems. For purposes of this Section 5.12, it is understood and
agreed that a single field examination may consist of examinations conducted at
multiple relevant sites and involve one or more relevant Loan Parties and their
assets. All such field examinations shall be at the sole expense of the Loan
Parties.

SECTION 5.13. Depository Banks. The Loan Parties will maintain one or more of
the Administrative Agent, the Lenders and their Affiliates as its principal
depository banks, including for the maintenance of operating, administrative,
cash management, collection activity, and other deposit accounts for the conduct
of its business.

SECTION 5.14. Additional Collateral; Further Assurances. (a) The Company and
each Subsidiary that is a Loan Party shall cause each of its Domestic
Subsidiaries formed or acquired after the Effective Date in accordance with the
terms of this Agreement to become a Loan Party by executing the Joinder
Agreement set forth as Exhibit E hereto (the “Joinder Agreement”) within thirty
(30) days (or such later date as may be agreed upon by the Administrative Agent)
of such formation, or acquisition, such Joinder Agreement to be accompanied by
appropriate corporate resolutions, other corporate organizational and
authorization documentation and legal opinions in form and substance reasonably
satisfactory to the Administrative Agent. Upon execution and delivery thereof,
each such Person (i) shall automatically become a Loan Guarantor hereunder and
thereupon shall have all of the rights, benefits, duties, and obligations in
such capacity under the Loan Documents and (ii) will grant Liens to the
Administrative Agent, for the benefit of the Secured Parties, in any property of
such Loan Party which constitutes Collateral, including any parcel of real
property located in the U.S. owned by any Loan Party.

 

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(b) Without limiting the generality of the foregoing, the Company and each
Domestic Subsidiary that is a Loan Party will cause the Applicable Pledge
Percentage of the issued and outstanding Equity Interests in each Domestic
Subsidiary and First Tier Foreign Subsidiary directly owned by the Company or
any Domestic Subsidiary to be subject at all times to a first priority,
perfected Lien in favor of the Administrative Agent for the benefit of the
Secured Parties, to secure the Secured Obligations in accordance with the terms
and conditions of the Collateral Documents or such other security documents as
the Administrative Agent shall reasonably request. Notwithstanding the
foregoing, (x) the parties hereto acknowledge and agree that no pledge agreement
in respect of the pledge of Equity Interests of a First Tier Foreign Subsidiary
shall be required until November 30, 2011 (or such later date as is agreed to by
the Administrative Agent in its reasonable discretion) and (y) no pledge
agreement in respect of the Equity Interests of a Foreign Subsidiary shall be
required hereunder to the extent the Administrative Agent or its counsel
determines that, in light of the cost and expense associated therewith, such
pledge would not provide material credit support for the benefit of the Secured
Parties pursuant to legally valid, binding and enforceable pledge agreements.

(c) To secure the prompt payment and performance of all of the Foreign Secured
Obligations, subject to applicable law, each Foreign Subsidiary Borrower shall
cause each of its Subsidiaries to (i) to the extent requested by the
Administrative Agent, become a party to a guarantee that guarantees repayment of
the Foreign Secured Obligations and is in form and substance reasonably
satisfactory to the Administrative Agent, (ii) pledge and grant a security
interest in 100% of the Equity Interests in each such Foreign Subsidiary
Guarantor by becoming party to a Foreign Security Agreement that is in form and
substance reasonably satisfactory to the Administrative Agent, and (iii) deliver
such other documentation, make any filings and take any other actions that the
Administrative Agent may reasonably require in order to perfect its first
priority security interest in the assets referred to clause (ii).

(d) Without limiting the foregoing, each Loan Party will, and will cause each
Subsidiary to, execute and deliver, or cause to be executed and delivered, to
the Administrative Agent such documents, agreements and instruments (including,
without limitation, deposit account control agreements and securities account
control agreements), and will take or cause to be taken such further actions
(including the filing and recording of financing statements and other documents
and such other actions or deliveries of the type required by Section 4.01, as
applicable), which may be required by law or which the Administrative Agent may,
from time to time, reasonably request to carry out the terms and conditions of
this Agreement and the other Loan Documents and to ensure perfection and
priority of the Liens created or intended to be created by the Collateral
Documents, all in form and substance reasonably satisfactory to the
Administrative Agent and all at the expense of the Loan Parties.

(e) If any material assets (including any real property or improvements thereto
or any interest therein) are acquired by any Borrower or any Subsidiary that is
a Loan Party after the Effective Date (other than assets constituting Collateral
under any Security Agreement that become subject to the Lien in favor of the
Administrative Agent upon acquisition thereof), the Company will notify the
Administrative Agent and the Lenders thereof, and, if requested by the
Administrative Agent or the Required Lenders, the Borrowers will cause such
assets to be subjected to a Lien securing the Secured Obligations or Foreign
Secured Obligations (as applicable) and will 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 (d) of this Section, all at the expense of the Loan
Parties.

 

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(f) If and for so long as Availability is less than $5,000,000, each Foreign
Loan Party shall, and each Borrower shall cause each Foreign Loan Party to,
notify all Account Debtors obligated on the Accounts of such Foreign Loan Party
of the Liens created by the applicable Foreign Security Agreement(s).

SECTION 5.15. Financial Assistance. Each Foreign Loan Party and its Subsidiaries
shall comply in all material respects with applicable legislation governing
financial assistance and/or capital maintenance, including Sections 678-679 of
the United Kingdom Companies Act 2006, as amended, including in relation to the
execution of the Foreign Security Agreements of each Foreign Loan Party and
payments of amounts due under this Agreement.

ARTICLE VI

Negative Covenants

Until the Commitments have expired or terminated and the principal of and
interest on each Loan and all fees, expenses and other amounts payable under any
Loan Document have been paid in full and all Letters of Credit have expired or
terminated and all LC Disbursements shall have been reimbursed, the Loan Parties
covenant and agree with the Lenders that:

SECTION 6.01. Indebtedness. No Loan Party will, nor will it permit any
Subsidiary to, create, incur or suffer to exist any Indebtedness, except:

(a) the Secured Obligations and the Second Lien Obligations; provided that, the
aggregate principal amount of the Second Lien Obligations shall not exceed
$40,000,000 at any time outstanding;

(b) Indebtedness existing on the date hereof and set forth in Schedule 6.01 and
extensions, renewals and replacements of any such Indebtedness in accordance
with clause (f) hereof;

(c) Indebtedness of the Company to any Subsidiary and of any Subsidiary to the
Company or any other Subsidiary; provided that (i) Indebtedness of any
Subsidiary that is not a Loan Party to the Company or any Subsidiary that is a
Loan Party shall be subject to Section 6.04 and (ii) Indebtedness of the Company
to any Subsidiary and Indebtedness of any Subsidiary that is a Loan Party to any
Subsidiary that is not a Loan Party shall be subordinated to the Secured
Obligations on terms reasonably satisfactory to the Administrative Agent;

(d) Guarantees by the Company of Indebtedness of any Subsidiary and by any
Subsidiary of Indebtedness of the Company or any other Subsidiary; provided that
(i) the Indebtedness so Guaranteed is permitted by this Section 6.01,
(ii) Guarantees by the Company or any Subsidiary that is a Loan Party of
Indebtedness of any Subsidiary that is not a Loan Party shall be subject to
Section 6.04 and (iii) Guarantees permitted under this clause (d) shall be
subordinated to the Secured Obligations of the applicable Subsidiary on the same
terms as the Indebtedness so Guaranteed is subordinated to the Secured
Obligations;

(e) Indebtedness of the Company or any Subsidiary incurred to finance the
acquisition, construction or improvement of any fixed or capital assets (whether
or not constituting purchase money Indebtedness), including Capital Lease
Obligations and any Indebtedness assumed in connection with the acquisition of
any such assets or secured by a Lien on any such assets prior to the acquisition
thereof, and extensions, renewals and replacements of any such Indebtedness in
accordance with clause (f) hereof; provided that (i) such Indebtedness is
incurred prior to or within ninety (90) days after such acquisition or the
completion of such construction or improvement and (ii) the aggregate principal
amount of Indebtedness permitted by this clause (e) shall not exceed $10,000,000
at any time outstanding;

 

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(f) Indebtedness which represents an extension, refinancing, or renewal of any
of the Indebtedness described in clauses (b), (e), (i) and (j) hereof; provided
that, (i) the principal amount as of the date hereof of such Indebtedness is not
increased, (ii) any Liens securing such Indebtedness are not extended to any
additional property of any Loan Party, (iii) no Loan Party that is not
originally obligated with respect to repayment of such Indebtedness is required
to become obligated with respect thereto, (iv) such extension, refinancing or
renewal does not result in a shortening of the average weighted maturity of the
Indebtedness so extended, refinanced or renewed, (v) the terms of any such
extension, refinancing, or renewal are not materially less favorable to the
obligor thereunder than the original terms of such Indebtedness and (iv) if the
Indebtedness that is refinanced, renewed, or extended was subordinated in right
of payment to the Secured Obligations, then the terms and conditions of the
refinancing, renewal, or extension Indebtedness must include subordination terms
and conditions that are at least as favorable to the Administrative Agent and
the Lenders as those that were applicable to the refinanced, renewed, or
extended Indebtedness;

(g) Indebtedness owed to any person providing workers’ compensation, health,
disability or other employee benefits or property, casualty or liability
insurance, pursuant to reimbursement or indemnification obligations to such
person, in each case incurred in the ordinary course of business;

(h) Indebtedness of the Company or any Subsidiary in respect of performance
bonds, bid bonds, appeal bonds, surety bonds and similar obligations, in each
case provided in the ordinary course of business;

(i) Indebtedness of any Person that becomes a Domestic Subsidiary after the date
hereof; provided that (i) such Indebtedness exists at the time such Person
becomes a Subsidiary and is not created in contemplation of or in connection
with such Person becoming a Domestic Subsidiary and (ii) the aggregate principal
amount of Indebtedness permitted by this clause (i) shall not exceed $10,000,000
at any time outstanding;

(j) Indebtedness of any Person that (1) becomes a Foreign Subsidiary after the
date hereof or (2) is a Foreign Subsidiary Borrower for which a Borrowing
Subsidiary Termination has been executed and delivered to the Administrative
Agent; provided that the aggregate principal amount of Indebtedness permitted by
this clause (j) shall not exceed $10,000,000 at any time outstanding; and

(k) other unsecured Indebtedness in an aggregate principal amount not exceeding
$10,000,000 at any time outstanding; provided that the aggregate principal
amount of Indebtedness of the Company’s Subsidiaries permitted by this clause
(k) shall not exceed $5,000,000 at any time outstanding.

SECTION 6.02. Liens. No Loan Party will, nor will it permit any Subsidiary to,
create, incur, assume or permit to exist any Lien on any property or asset now
owned or hereafter acquired by it, or assign or sell any income or revenues
(including accounts receivable) or rights in respect of any thereof, except:

(a) Liens created pursuant to any Loan Document or any Second Lien Document;
provided that, with respect to Liens created pursuant to any Second Lien
Document, (i) such security interests secure Indebtedness permitted by clause
(a) of Section 6.01, and (ii) other than with respect to the Specified Assets,
such Liens are subordinate to the Secured Obligations in accordance with the
terms of the Intercreditor Agreement;

 

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(b) Permitted Encumbrances;

(c) any Lien on any property or asset of the Company or any Subsidiary existing
on the date hereof and set forth in Schedule 6.02; provided that (i) such Lien
shall not apply to any other property or asset of the Company or Subsidiary and
(ii) such Lien shall secure only those obligations which it secures on the date
hereof and extensions, renewals and replacements thereof that do not increase
the outstanding principal amount thereof;

(d) Liens on fixed or capital assets acquired, constructed or improved by the
Company or any Subsidiary; provided that (i) such security interests secure
Indebtedness permitted by clause (e) of Section 6.01, (ii) such security
interests and the Indebtedness secured thereby are incurred prior to or within
ninety (90) days after such acquisition or the completion of such construction
or improvement, (iii) the Indebtedness secured thereby does not exceed the cost
of acquiring, constructing or improving such fixed or capital assets and
(iv) such security interests shall not apply to any other property or assets of
the Company or Subsidiary;

(e) any Lien existing on any property or asset (other than Accounts, Inventory
and Trademarks) prior to the acquisition thereof by any Loan Party or any
Subsidiary or existing on any property or asset (other than Accounts, Inventory
and Trademarks) of any Person prior to the acquisition of such Person by any
Loan Party or any Subsidiary; provided that (i) such Lien is not created in
contemplation of or in connection with such acquisition, (ii) such Lien shall
not apply to any other property or assets of a Loan Party and (iii) such Lien
shall secure only those obligations which it secures on the date of such
acquisition or the date such Person becomes a Loan Party, as the case may be and
extensions, renewals and replacements thereof that do not increase the
outstanding principal amount thereof;

(f) Liens of a collecting bank arising in the ordinary course of business under
Section 4-208 of the Uniform Commercial Code in effect in the relevant
jurisdiction covering only the items being collected upon;

(g) possessory Liens in favor of lessees or sublessees of property leased or
subleased by the Company or any Subsidiary in the ordinary course of business of
the Company or such Subsidiary; provided that such Liens attach only to such
property;

(h) Liens arising out of sale and leaseback transactions permitted by
Section 6.06;

(i) Liens granted by a Subsidiary that is not a Loan Party in favor of the
Company or another Loan Party in respect of Indebtedness owed by such
Subsidiary; and

(j) Liens granted by a Foreign Subsidiary that is not a Loan Party on its
assets; provided that such security interests secure Indebtedness permitted by
clause (j) of Section 6.01.

Notwithstanding the foregoing, none of the Liens permitted pursuant to this
Section 6.02 may at any time attach to any Loan Party’s (1) Accounts or
Trademarks, other than those permitted under clause (a) of the definition of
Permitted Encumbrance and clause (a) above or (2) Inventory, other than those
permitted under clauses (a) and (b) of the definition of Permitted Encumbrance
and clause (a) above.

 

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SECTION 6.03. Fundamental Changes. (a) No Loan Party will, nor will it permit
any Subsidiary to, merge into or consolidate with any other Person, or permit
any other Person to merge into or consolidate with it, or liquidate or dissolve,
except that, if at the time thereof and immediately after giving effect thereto
no Event of Default shall have occurred and be continuing (i) any Subsidiary of
the Company may merge into the Company in a transaction in which the Company is
the surviving corporation, (ii) any Loan Party (other than the Company) may
merge into any Loan Party in a transaction in which the surviving entity is a
Loan Party and (iii) any Subsidiary that is not a Loan Party may liquidate or
dissolve if the Company determines in good faith that such liquidation or
dissolution is in the best interests of the Company and is not materially
disadvantageous to the Lenders; provided that any such merger involving a Person
that is not a wholly owned Subsidiary immediately prior to such merger shall not
be permitted unless also permitted by Section 6.04.

(b) No Loan Party will, nor will it permit any of its Subsidiaries to, engage in
any business other than businesses of the type conducted by the Company and its
Subsidiaries on the date of execution of this Agreement and businesses
reasonably related thereto.

SECTION 6.04. Investments, Loans, Advances, Guarantees and Acquisitions. No Loan
Party will, nor will it permit any Subsidiary to, purchase, hold or acquire
(including pursuant to any merger with any Person that was not a Loan Party and
a wholly owned Subsidiary prior to such merger) any capital stock, evidences of
indebtedness or other securities (including any option, warrant or other right
to acquire any of the foregoing) of, make or permit to exist any loans or
advances to, Guarantee any obligations of, or make or permit to exist any
investment or any other interest in, any other Person, or purchase or otherwise
acquire (in one transaction or a series of transactions) any assets of any other
Person constituting a business unit (whether through purchase of assets, merger
or otherwise), except:

(a) Permitted Investments subject, to the extent requested by the Administrative
Agent, to control agreements in favor of the Administrative Agent for the
benefit of the Secured Parties or otherwise subject to a perfected security
interest in favor of the Administrative Agent for the benefit of the Secured
Parties;

(b) investments in existence on the date of this Agreement and described in
Schedule 6.04;

(c) investments by the Company and the Subsidiaries in Equity Interests in their
respective Subsidiaries; provided that (A) any such Equity Interests held by a
Loan Party shall be pledged pursuant to a Security Agreement (subject to the
limitations applicable to common stock of an Affected Foreign Subsidiary
referred to in Section 5.14) and (B) the aggregate amount of investments by Loan
Parties in Subsidiaries that are not Loan Parties (together with outstanding
intercompany loans permitted under clause (B) to the proviso to Section 6.04(d)
and outstanding Guarantees permitted under the proviso to Section 6.04(e)) shall
not exceed $10,000,000 at any time outstanding (in each case determined without
regard to any write-downs or write-offs);

(d) loans or advances made by a Loan Party to any Subsidiary and made by any
Subsidiary to any Loan Party or any other Subsidiary; provided that (A) any such
loans and advances made by a Loan Party shall be evidenced by a promissory note
pledged pursuant to a Security Agreement and (B) the amount of such loans and
advances made by Loan Parties to Subsidiaries that are not Loan Parties
(together with outstanding investments permitted under clause (B) to the proviso
to Section 6.04(c) and outstanding Guarantees permitted under the proviso to
Section 6.04(e)) shall not exceed $10,000,000 at any time outstanding (in each
case determined without regard to any write-downs or write-offs);

 

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(e) Guarantees constituting Indebtedness permitted by Section 6.01; provided
that the aggregate principal amount of Indebtedness of Subsidiaries that are not
Loan Parties that is Guaranteed by any Loan Party shall (together with
outstanding investments permitted under clause (B) to the proviso to Section
6.04(c) and outstanding intercompany loans permitted under clause (B) to the
proviso to Section 6.04(d)) shall not exceed $10,000,000 at any time outstanding
(in each case determined without regard to any write-downs or write-offs);

(f) loans or advances made by a Loan Party to its employees on an arms-length
basis in the ordinary course of business consistent with past practices for
travel and entertainment expenses, relocation costs and similar purposes up to a
maximum of $2,000,000 in the aggregate at any one time outstanding;

(g) subject to Sections 4.2(a) and 4.4 of the Domestic Security Agreement (and
any similar provisions in each Foreign Security Agreement), notes payable, or
stock or other securities issued by Account Debtors to a Loan Party pursuant to
negotiated agreements with respect to settlement of such Account Debtor’s
Accounts in the ordinary course of business, consistent with past practices;

(h) investments in the form of Swap Agreements permitted by Section 6.07;

(i) investments of any Person existing at the time such Person becomes a
Subsidiary of the Company or consolidates or merges with the Company or any of
its Subsidiaries (including in connection with a Permitted Acquisition) so long
as such investments were not made in contemplation of such Person becoming a
Subsidiary or of such merger;

(j) investments received in connection with the dispositions of assets permitted
by Section 6.05;

(k) investments constituting deposits described in clauses (c) and (d) of the
definition of the term “Permitted Encumbrances”;

(l) Permitted Acquisitions;

(m) acquisitions made by any Loan Party from any other Loan Party;

(n) investments in Persons that are not Subsidiaries and/or purchases of assets
other than in the ordinary course of business not constituting Permitted
Acquisitions from Persons that are not, and do not thereby become, Subsidiaries;
provided that, the aggregate outstanding amount permitted under this clause
(n) shall not at any time exceed $25,000,000;

(o) investments by the Company and the Subsidiaries in Equity Interests in their
respective Subsidiaries and loans or advances made by a Loan Party to any
Subsidiary or made by any Subsidiary to any Loan Party, in each case, made in
order to consummate Permitted Acquisitions; and

(p) other investments in an aggregate amount not to exceed $3,000,000.

SECTION 6.05. Asset Sales. No Loan Party will, nor will it permit any Subsidiary
to, sell, transfer, lease or otherwise dispose of any asset, including any
Equity Interest owned by it, nor will the Company permit any Subsidiary to issue
any additional Equity Interest in such Subsidiary (other than to the Company or
another Subsidiary in compliance with Section 6.04), except:

(a) sales, transfers and dispositions of (i) inventory in the ordinary course of
business and (ii) used, obsolete, worn out or surplus equipment or property in
the ordinary course of business;

 

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(b) sales, transfers and dispositions to any Loan Party or any Subsidiary;
provided that any such sales, transfers or dispositions involving a Subsidiary
that is not a Loan Party shall be made in compliance with Sections 6.04 and
6.09;

(c) sales, transfers and dispositions of accounts receivable in connection with
the compromise, settlement or collection thereof;

(d) sales, transfers and dispositions of Permitted Investments and other
investments permitted by clauses (i) and (k) of Section 6.04;

(e) sale and leaseback transactions permitted by Section 6.06;

(f) dispositions resulting from any casualty or other insured damage to, or any
taking under power of eminent domain or by condemnation or similar proceeding
of, any property or asset of the Company or any Subsidiary; and

(g) sales, transfers and other dispositions of assets (other than Equity
Interests in a Subsidiary unless all Equity Interests in such Subsidiary are
sold) that are not permitted by any other paragraph of this Section; provided
that the aggregate fair market value of all assets sold, transferred or
otherwise disposed of in reliance upon this paragraph (g) shall not exceed
$2,500,000 in any 12-month period;

provided that all sales, transfers, leases and other dispositions permitted
hereby in respect of property having a value in excess of $600,000 (other than
those permitted by paragraphs (b) and (f) above) shall be made for fair value
and for at least 75% cash consideration.

SECTION 6.06. Sale and Leaseback Transactions. No Loan Party will, nor will it
permit any Subsidiary to, enter into any arrangement, directly or indirectly,
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 sold or transferred, except for any
such sale of any fixed or capital assets by the Company or any Subsidiary that
is made for cash consideration in an amount not less than the fair value of such
fixed or capital asset and is consummated within ninety (90) days after the
Company or such Subsidiary acquires or completes the construction of such fixed
or capital asset.

SECTION 6.07. Swap Agreements. No Loan Party will, nor will it permit any
Subsidiary to, enter into any Swap Agreement, except (a) Swap Agreements entered
into to hedge or mitigate risks to which any Loan Party or any Subsidiary has
actual exposure (other than those in respect of Equity Interests of the Company
or any of its Subsidiaries), 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 any Loan Party or any
Subsidiary.

SECTION 6.08. Restricted Payments; Certain Payments of Indebtedness. (a) No Loan
Party will, nor will it permit any Subsidiary to, declare or make, or agree to
pay or make, directly or indirectly, any Restricted Payment, or incur any
obligation (contingent or otherwise) to do so, except (i) the Company may
declare and pay dividends with respect to its common stock payable solely in
additional shares of its common stock, and, with respect to its preferred stock,
payable solely in additional

 

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shares of such preferred stock or in shares of its common stock, (ii) the
Subsidiaries may declare and pay dividends ratably with respect to their Equity
Interests, (iii) the Company may make Restricted Payments pursuant to and in
accordance with stock option plans or other benefit plans for management or
employees of the Company and its Subsidiaries, and (iv) the Company and the
Subsidiaries may declare or make, or agree to pay or make, directly or
indirectly, any other Restricted Payment so long as (A) no Default or Event of
Default has occurred and is continuing prior to giving effect to such Restricted
Payment or would arise after giving effect thereto, (B) Availability exceeds
$25,000,000 after giving pro forma effect to such Restricted Payment for a
period of six (6) consecutive months prior to such Restricted Payment and
(C) the Fixed Charge Coverage Ratio, after giving effect to such Restricted
Payment on a pro forma basis, determined for the four consecutive fiscal
quarters ending on the last day of the most recently ended fiscal quarter of the
Company for which financial statements are available, is equal to or greater
than 1.25 to 1.00.

(b) No Loan Party will, nor will it permit any Subsidiary to, make or agree 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 any 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 any Indebtedness, except:

(i) payment of Indebtedness created under the Loan Documents;

(ii) payment of regularly scheduled interest on the Second Lien Obligations;

(iii) payment of regularly scheduled interest and principal payments as and when
due in respect of any Indebtedness, other than payments in respect of the
Subordinated Indebtedness prohibited by the subordination provisions thereof;

(iv) refinancings of Indebtedness to the extent permitted by Section 6.01; and

(v) payment of secured Indebtedness that becomes due as a result of the
voluntary sale or transfer of the property or assets securing such Indebtedness;

provided that, the Company and its Subsidiaries may make any payment with
respect to the Second Lien Obligations without giving effect to any restrictions
set forth in this clause (b) so long as (A) no Default or Event of Default has
occurred and is continuing prior to and after giving effect thereto,
(B) Availability exceeds $25,000,000 after giving pro forma effect to such
payment for a period of six consecutive months prior thereto and (C) the Fixed
Charge Coverage Ratio, on a pro forma basis after giving effect to such payment,
determined for the four (4) consecutive fiscal quarters ending on the last day
of the most recently ended fiscal quarter of the Company for which financial
statements are available, is equal to or greater than 1.25 to 1.00.

SECTION 6.09. Transactions with Affiliates. No Loan Party will, nor will it
permit any Subsidiary to, sell, lease or otherwise transfer any property or
assets to, or purchase, lease or otherwise acquire any property or assets from,
or otherwise engage in any other transactions with, any of its Affiliates,
except (a) transactions that (i) are in the ordinary course of business and
(ii) are at prices and on terms and conditions not less favorable to the Loan
Party or such Subsidiary than could be obtained on an arm’s-length basis from
unrelated third parties, (b) transactions between or among the Loan Party and
any Subsidiary that is a Loan Party not involving any other Affiliate, (c) any
investment permitted by Sections 6.04(c) or 6.04(d), (d) any Indebtedness
permitted under Section 6.01(c), (e) any Restricted Payment permitted by
Section 6.08, (f) loans or advances to employees permitted under Section 6.04,
(g)

 

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the payment of reasonable fees to directors of the Company or any Subsidiary who
are not employees of the Company or any Subsidiary, and compensation and
employee benefit arrangements paid to, and indemnities provided for the benefit
of, directors, officers or employees of the Company or its Subsidiaries in the
ordinary course of business and (h) any issuances of securities or other
payments, awards or grants in cash, securities or otherwise pursuant to, or the
funding of, employment agreements, stock options and stock ownership plans
approved by the Company’s board of directors.

SECTION 6.10. Restrictive Agreements. No Loan Party will, nor will it permit any
Subsidiary to, directly or indirectly, enter into, incur or permit to exist any
agreement or other arrangement that prohibits, restricts or imposes any
condition upon (a) the ability of such Loan Party or any of its Subsidiaries to
create, incur or permit to exist any Lien upon any of its property or assets, or
(b) the ability of any Subsidiary to pay dividends or other distributions with
respect to any shares of its capital stock or to make or repay loans or advances
to the Company or any other Subsidiary or to Guarantee Indebtedness of the
Company or any other Subsidiary; provided that (i) the foregoing shall not apply
to restrictions and conditions imposed by law, by any Loan Document, or by any
Second Lien Document as such Second Lien Document exists as of the Effective
Date, (ii) the foregoing shall not apply to restrictions and conditions existing
on the date hereof identified on Schedule 6.10 (but shall apply to any extension
or renewal of, or any amendment or modification expanding the scope of, any such
restriction or condition), (iii) the foregoing shall not apply to customary
restrictions and conditions contained in agreements relating to the sale of a
Subsidiary pending such sale; provided such restrictions and conditions apply
only to the Subsidiary that is to be sold and such sale is permitted hereunder,
(iv) clause (a) of the foregoing shall not apply to restrictions or conditions
imposed by any agreement relating to secured Indebtedness permitted by this
Agreement if such restrictions or conditions apply only to the property or
assets securing such Indebtedness and (v) clause (a) of the foregoing shall not
apply to customary provisions in leases restricting the assignment thereof.

SECTION 6.11. Amendment of Material Documents. No Loan Party will, nor will it
permit any Subsidiary to, amend, modify or waive any of its rights under (a) any
agreement relating to any Subordinated Indebtedness or any Second Lien
Obligations, in each case, except as permitted in any intercreditor agreement
(including the Intercreditor Agreement) between the Administrative Agent (on
behalf of the Secured Parties) and the holders of such Indebtedness, (b) any
Material Indebtedness in any way that creates a Burdensome Restriction or
(c) its certificate of incorporation, by-laws, operating, management or
partnership agreement or other organizational documents, in each case, to the
extent any such amendment, modification or waiver would be adverse to the
Lenders.

SECTION 6.12. Fixed Charge Coverage Ratio. At any time that Availability is less
than $17,500,000 and continuing until Availability of at least $20,000,000 is
maintained for a period of three (3) consecutive months, the Company will not
permit the Fixed Charge Coverage Ratio, determined for any period of four
(4) consecutive fiscal quarters ending on the last day of each fiscal quarter,
to be less than 1.10 to 1.00.

ARTICLE VII

Events of Default

If any of the following events (“Events of Default”) shall occur:

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

 

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(b) any Borrower shall fail to pay any interest on any Loan or any fee or any
other amount (other than an amount referred to in clause (a) of this Article)
payable under this Agreement, when and as the same shall become due and payable,
and such failure shall continue unremedied for a period of three (3) Business
Days;

(c) any representation or warranty made or deemed made by or on behalf of any
Loan Party or any Subsidiary in or in connection with this Agreement or any Loan
Document or any amendment or modification thereof or waiver thereunder, or in
any report, certificate, financial statement or other document furnished
pursuant to or in connection with this Agreement or any Loan Document or any
amendment or modification thereof or waiver thereunder, shall prove to have been
incorrect in any material respect when made or deemed made;

(d) any Loan Party shall fail to observe or perform any covenant, condition or
agreement contained in Section 5.02(a), 5.03 (with respect to a Loan Party’s
existence), 5.08, 5.14 or 5.15 or in Article VI;

(e) any Loan Party shall fail to observe or perform any covenant, condition or
agreement contained in this Agreement (other than those which constitute a
default under another Section of this Article), and such failure shall continue
unremedied for a period of (i) five (5) Business Days after the earlier of any
Loan Party’s knowledge of such breach or notice thereof from the Administrative
Agent (which notice will be given at the request of any Lender) if such breach
relates to terms or provisions of Section 5.01, 5.02 (other than
Section 5.02(a)), 5.03 through 5.07, 5.09, 5.10, 5.11 or 5.12 of this Agreement
or (ii) thirty (30) days after the earlier of any Loan Party’s knowledge of such
breach or notice thereof from the Administrative Agent (which notice will be
given at the request of any Lender) if such breach relates to terms or
provisions of any other Section of this Agreement;

(f) any Loan Party or any Subsidiary shall fail to make any payment (whether of
principal or interest and regardless of amount) in respect of any Material
Indebtedness, when and as the same shall become due and payable;

(g) any event or condition occurs that results in any Material Indebtedness
becoming due prior to its scheduled maturity or that enables or permits (with or
without the giving of notice, the lapse of time or both) the holder or holders
of any Material Indebtedness or any trustee or agent on its or their behalf to
cause any Material Indebtedness to become due, or to require the prepayment,
repurchase, redemption or defeasance thereof, prior to its scheduled maturity;
provided that this clause (g) 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;

(h) an involuntary proceeding shall be commenced or an involuntary petition
shall be filed seeking (i) liquidation, administration, receivership,
reorganization or other relief in respect of a Loan Party or any Subsidiary of
any Loan Party or its debts, or of a substantial part of its assets, under any
Federal, state or foreign bankruptcy, insolvency, receivership or similar law
now or hereafter in effect or (ii) the appointment of a receiver, trustee,
administrator, custodian, sequestrator, conservator or similar official for any
Loan Party or any Subsidiary of any Loan Party or for a substantial part of its
assets, and, in any such case, such proceeding or petition shall continue
undismissed for sixty (60) days or an order or decree approving or ordering any
of the foregoing shall be entered;

(i) (i) any Loan Party or any Subsidiary of any Loan Party shall (A) voluntarily
commence any proceeding or file any petition seeking liquidation, reorganization
or other relief under any Federal, state or foreign bankruptcy, insolvency,
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effect, (B) consent to the institution of, or fail to contest in a timely and
appropriate manner, any proceeding or petition described in clause (h) of this
Article, (C) apply for or consent to the appointment of a receiver, trustee,
custodian, sequestrator, conservator or similar official for such Loan Party or
Subsidiary of any Loan Party or for a substantial part of its assets, (D) file
an answer admitting the material allegations of a petition filed against it in
any such proceeding, (E) make a general assignment for the benefit of creditors
or (F) take any action for the purpose of effecting any of the foregoing or
(ii) a U.K. Insolvency Event shall occur in respect of any U.K. Relevant Entity;

(j) any Loan Party or any Subsidiary of any Loan Party shall become unable,
admit in writing its inability or fail generally to pay its debts as they become
due;

(k) one or more judgments for the payment of money in an aggregate amount in
excess of $5,000,000 shall be rendered against any Loan Party, any Subsidiary of
any Loan Party or any combination thereof and the same shall remain undischarged
for a period of thirty (30) consecutive days during which execution shall not be
effectively stayed, or any action shall be legally taken by a judgment creditor
to attach or levy upon any assets of any Loan Party or any Subsidiary of any
Loan Party to enforce any such judgment or any Loan Party or any Subsidiary of
any Loan Party shall fail within thirty (30) days to discharge one or more
non-monetary judgments or orders which, individually or in the aggregate, could
reasonably be expected to have a Material Adverse Effect, which judgments or
orders, in any such case, are not stayed on appeal or otherwise being
appropriately contested in good faith by proper proceedings diligently pursued;

(l) an ERISA Event shall have occurred that, in the opinion of the Required
Lenders, when taken together with all other ERISA Events that have occurred,
could reasonably be expected to result in a Material Adverse Effect;

(m) a Change in Control shall occur;

(n) the occurrence of any “default” or “Event of Default”, as defined in any
Loan Document (other than this Agreement) or the breach of any of the terms or
provisions of any Loan Document (other than this Agreement), which default or
breach continues beyond any period of grace therein provided;

(o) the Loan Guaranty shall fail to remain in full force or effect or any action
shall be taken to discontinue or to assert the invalidity or unenforceability of
the Loan Guaranty, or any Loan Guarantor shall fail to comply with any of the
terms or provisions of the Loan Guaranty to which it is a party, or any Loan
Guarantor shall deny that it has any further liability under the Loan Guaranty
to which it is a party, or shall give notice to such effect;

(p) any Collateral Document shall for any reason fail to create a valid and
perfected first priority security interest in any Collateral purported to be
covered thereby, except as permitted by the terms of any Collateral Document, or
any Collateral Document shall fail to remain in full force or effect or any
action shall be taken to discontinue or to assert the invalidity or
unenforceability of any Collateral Document, or any Loan Party shall fail to
comply with any of the terms or provisions of any Collateral Document;

(q) any material provision of any Loan Document for any reason ceases to be
valid, binding and enforceable in accordance with its terms (or any Loan Party
shall challenge the enforceability of any Loan Document or shall assert in
writing, or engage in any action or inaction based on any such assertion, that
any provision of any of the Loan Documents has ceased to be or otherwise is not
valid, binding and enforceable in accordance with its terms); or

 

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(r) any of the Borrowers or Subsidiaries shall have been notified by the
Pensions Regulator or the trustees of a Non-U.S. Pension Plan that any of them
has, in relation to a Non-U.S. Pension Plan, incurred a debt or other liability
under Section 75 or 75A of the United Kingdom Pensions Act 1995, or has been
issued with a Contribution Notice or Financial Support Direction, or otherwise
is liable to pay any other amount in respect of Non-U.S. Pension Plans, in each
case, that could reasonably be expected to result in a Material Adverse Effect;

then, and in every such event (other than an event with respect to any Borrower
described in clause (h) or (i) of this Article), and at any time thereafter
during the continuance of such event, the Administrative Agent may, and at the
request of the Required Lenders shall, by notice to the Company, take either or
both of the following actions, at the same or different times: (i) terminate the
Commitments, and thereupon the Commitments shall terminate immediately, and
(ii) declare the Loans then outstanding to be due and payable in whole (or in
part, in which case any principal not so declared to be due and payable may
thereafter be declared to be due and payable), and thereupon the principal of
the Loans so declared to be due and payable, together with accrued interest
thereon and all fees and other obligations of the Borrowers accrued hereunder,
shall become due and payable immediately, without presentment, demand, protest
or other notice of any kind, all of which are hereby waived by the Borrowers;
and in case of any event with respect to any Borrower described in clause (h) or
(i) of this Article, the Commitments shall automatically terminate and the
principal of the Loans then outstanding, together with accrued interest thereon
and all fees and other obligations of the Borrowers accrued hereunder, shall
automatically become due and payable, without presentment, demand, protest or
other notice of any kind, all of which are hereby waived by the Borrowers. Upon
the occurrence and during the continuance of an Event of Default, the
Administrative Agent may, and at the request of the Required Lenders shall,
exercise any rights and remedies provided to the Administrative Agent under the
Loan Documents or at law or equity, including all remedies provided under the
UCC.

ARTICLE VIII

The Administrative Agent and The Co-Collateral Agents

Each of the Lenders and the Issuing Bank hereby irrevocably appoints JPMorgan
Chase Bank, N.A. as Administrative Agent hereunder and under each other Loan
Document, and each of the Lenders and the Issuing Bank authorizes the
Administrative Agent to enter into the Intercreditor Agreement, on behalf of
such Lender and the Issuing Bank (each Lender and the Issuing Bank hereby
agreeing to be bound by the terms of the Intercreditor Agreement, as if it were
a party thereto) and to take such actions on its behalf, including execution of
the other Loan Documents, and on behalf of the Secured Parties and to exercise
such powers as are delegated to the Administrative Agent by the terms hereof and
the terms of the other Loan Documents, together with such actions and powers as
are reasonably incidental thereto.

Each of the Lenders and the Issuing Bank hereby irrevocably appoints JPMorgan
Chase Bank, N.A. and HSBC Bank USA, National Association, as Co-Collateral
Agents and authorizes the Co- Collateral Agents to take such action on its
behalf and to exercise such powers as are delegated to the Co- Collateral Agents
by the terms of the Loan Documents, together with such actions and powers as are
reasonably incidental thereto.

Any bank serving as an Agent hereunder shall have the same rights and powers in
its capacity as a Lender as any other Lender and may exercise the same as though
it were not such Agent, and such bank and its Affiliates may accept deposits
from, lend money to and generally engage in any kind of business with the Loan
Parties or any Subsidiary of a Loan Party or other Affiliate thereof as if it
were not such Agent hereunder.

 

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No Agent shall have any duties or obligations except those expressly set forth
in the Loan Documents. Without limiting the generality of the foregoing, (a) no
Agent shall be subject to any fiduciary or other implied duties, regardless of
whether a Default has occurred and is continuing, (b) no Agent shall have any
duty to take any discretionary action or exercise any discretionary powers,
except discretionary rights and powers expressly contemplated by the Loan
Documents that such Agent is required to exercise in writing as directed by the
Required Lenders (or such other number or percentage of the Lenders as shall be
necessary under the circumstances as provided in Section 9.02), and (c) except
as expressly set forth in the Loan Documents, no Agent shall have any duty to
disclose, and shall not be liable for the failure to disclose, any information
relating to any Loan Party or any of its Subsidiaries that is communicated to or
obtained by the bank serving as an Agent or any of its Affiliates in any
capacity. No Agent shall be liable for any action taken or not taken by it with
the consent or at the request of the Required Lenders (or such other number or
percentage of the Lenders as shall be necessary under the circumstances as
provided in Section 9.02) or in the absence of its own gross negligence or
willful misconduct. No Agent shall be deemed to have knowledge of any Default
unless and until written notice thereof is given to such Agent by the Company or
a Lender, and no Agent shall be responsible for or have any duty to ascertain or
inquire into (i) any statement, warranty or representation made in or in
connection with any Loan Document, (ii) the contents of any certificate, report
or other document delivered hereunder or in connection with any Loan Document,
(iii) the performance or observance of any of the covenants, agreements or other
terms or conditions set forth in any Loan Document, (iv) the validity,
enforceability, effectiveness or genuineness of any Loan Document or any other
agreement, instrument or document, (v) the creation, perfection or priority of
Liens on the Collateral or the existence of the Collateral, or (vi) the
satisfaction of any condition set forth in Article IV or elsewhere in any Loan
Document, other than to confirm receipt of items expressly required to be
delivered to such Agent.

The Agents shall be entitled to rely upon, and shall not incur any liability for
relying upon, any notice, request, certificate, consent, statement, instrument,
document or other writing believed by it to be genuine and to have been signed
or sent by the proper Person. The Agents also may rely upon any statement made
to it orally or by telephone and believed by it to be made by the proper Person,
and shall not incur any liability for relying thereon. The Agents may consult
with legal counsel, independent accountants and other experts selected by it,
and shall not be liable for any action taken or not taken by it in accordance
with the advice of any such counsel, accountants or experts.

An Agent may perform any and all its duties and exercise its rights and powers
by or through any one or more sub-agents appointed by such Agent. An Agent and
any such sub-agent may perform any and all its duties and exercise its rights
and powers through their respective Related Parties. The exculpatory provisions
of the preceding paragraphs shall apply to any such sub-agent and to the Related
Parties of the Agents and any such sub-agent, and shall apply to their
respective activities in connection with the syndication of the credit
facilities provided for herein as well as activities as an Agent.

Subject to the appointment and acceptance of a successor Administrative Agent as
provided in this paragraph, the Administrative Agent may resign at any time by
notifying the Lenders, the Issuing Bank and the Borrower Representative. Upon
any such resignation, the Required Lenders shall have the right, in consultation
with the Borrower Representative, to appoint a successor. If no successor shall
have been so appointed by the Required Lenders and shall have accepted such
appointment within thirty (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 commercial bank or an Affiliate of any such commercial
bank. Upon the acceptance of its appointment as Administrative Agent hereunder
by a successor, such successor shall succeed to and become vested with all the
rights, powers, privileges and duties of the retiring Administrative Agent, and
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and obligations hereunder. The fees payable by the Borrowers to a successor
Administrative Agent shall be the same as those payable to its predecessor
unless otherwise agreed between the Borrowers and such successor. After the
Administrative Agent’s resignation hereunder, the provisions of this Article,
Section 2.18(d) and Section 9.03 shall continue in effect for the benefit of
such retiring Administrative Agent, its sub agents and their respective Related
Parties in respect of any actions taken or omitted to be taken by any of them
while it was acting as Administrative Agent.

Subject to the appointment and acceptance of a successor Co-Collateral Agent as
provided in this paragraph, a Co-Collateral Agent may resign at any time by
notifying the other Co- Collateral Agent, the Administrative Agent, the Lenders,
the Issuing Bank and the Borrower Representative. Upon any such resignation, the
Administrative Agent shall have the right, with the approval of the Required
Lenders, to appoint a successor. If no successor shall have been so approved by
the Required Lenders and shall have accepted such appointment within thirty
(30) days after the retiring Co-Collateral Agent gives notice of its
resignation, then the Administrative Agent shall perform the duties of such
Co-Collateral Agent. Upon the acceptance of its appointment as Co-Collateral
Agent hereunder by a successor, such successor shall succeed to and become
vested with all the rights, powers, privileges and duties of the retiring
Co-Collateral Agent, and the retiring Co-Collateral Agent shall be discharged
from its duties and obligations hereunder. After a Co-Collateral Agent’s
resignation hereunder, the provisions of this Article and Section 9.03 shall
continue in effect for the benefit of such retiring Co- Collateral Agent, its
sub agents and their respective Related Parties in respect of any actions taken
or omitted to be taken by any of them while it was acting as Co-Collateral
Agent.

The actions of the Co-Collateral Agents shall be taken jointly; provided that,
in the event the Co-Collateral Agents shall fail to agree within the time period
required for such action (or, if no time period is specified herein, within a
reasonable time in light of the circumstances, but in no event more than five
(5) Business Days from the first determination that action is required), the
more restrictive action proposed to be taken shall govern.

Each Lender acknowledges 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 credit analysis and decision to enter into
this Agreement. Each Lender also acknowledges that it will, independently and
without reliance upon any Agent or any other Lender and based on such documents
and information as it shall from time to time deem appropriate, continue to make
its own decisions in taking or not taking action under or based upon this
Agreement, any other Loan Document or related agreement or any document
furnished hereunder or thereunder.

Each Lender hereby agrees that (a) it has requested a copy of each Report
prepared by or on behalf of the Administrative Agent or the Co-Collateral
Agents; (b) each of the Administrative Agent and the Co-Collateral Agents
(i) makes no representation or warranty, express or implied, as to the
completeness or accuracy of any Report or any of the information contained
therein or any inaccuracy or omission contained in or relating to a Report and
(ii) shall not be liable for any information contained in any Report; (c) the
Reports are not comprehensive audits or examinations, and that any Person
performing any field examination will inspect only specific information
regarding the Loan Parties and will rely significantly upon the Loan Parties’
books and records, as well as on representations of the Loan Parties’ personnel
and that the Administrative Agent and the Co-Collateral Agents undertake no
obligation to update, correct or supplement the Reports; (d) it will keep all
Reports confidential and strictly for its internal use, not share the Report
with any Loan Party or any other Person except as otherwise permitted pursuant
to this Agreement; and (e) without limiting the generality of any other
indemnification provision contained in this Agreement, it will pay and protect,
and indemnify, defend, and hold the Administrative Agent, the Co-Collateral
Agents and any such other Person preparing a Report harmless from and against,
the claims, actions, proceedings, damages, costs, expenses, and other amounts
(including reasonable attorney fees) incurred by such Person as the direct or
indirect result of any third parties who might obtain all or part of any Report
through the indemnifying Lender.

 

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None of the Lenders, if any, identified in this Agreement as a Syndication Agent
shall have any right, power, obligation, liability, responsibility or duty under
this Agreement other than those applicable to all Lenders as such. Without
limiting the foregoing, none of such Lenders shall have or be deemed to have a
fiduciary relationship with any Lender. Each Lender hereby makes the same
acknowledgments with respect to any Lender in its capacity as Syndication Agent,
as it makes with respect to the Administrative Agent in the preceding paragraph.

Except with respect to the exercise of setoff rights of any Lender, in
accordance with Section 9.08, the proceeds of which are applied in accordance
with this Agreement, each Lender agrees that it will not take any action, nor
institute any actions or proceedings, against any Borrower or with respect to
any Loan Document, without the prior written consent of the Required Lenders or,
as may be provided in this Agreement or the other Loan Documents, with the
consent of the Administrative Agent.

The Lenders are not partners or co-venturers, and no Lender shall be liable for
the acts or omissions of, or (except as otherwise set forth herein in case of
the Administrative Agent) authorized to act for, any other Lender. The
Administrative Agent shall have the exclusive right on behalf of the Lenders to
enforce the payment of the principal of and interest on any Loan after the date
such principal or interest has become due and payable pursuant to the terms of
this Agreement.

In its capacity, the Administrative Agent is a “representative” of the Secured
Parties within the meaning of the term “secured party” as defined in the New
York Uniform Commercial Code. Each Lender authorizes the Administrative Agent to
enter into each of the Collateral Documents to which it is a party and to take
all action contemplated by such documents. Each Lender agrees that no Secured
Party (other than the Administrative Agent) shall have the right individually to
seek to realize upon the security granted by any Collateral Document, it being
understood and agreed that such rights and remedies may be exercised solely by
the Administrative Agent for the benefit of the Secured Parties upon the terms
of the Collateral Documents. In the event that any Collateral is hereafter
pledged by any Person as collateral security for the Secured Obligations, the
Administrative Agent is hereby authorized, and hereby granted a power of
attorney, to execute and deliver on behalf of the Secured Parties any Loan
Documents necessary or appropriate to grant and perfect a Lien on such
Collateral in favor of the Administrative Agent on behalf of the Secured
Parties. The Lenders hereby authorize the Administrative Agent, at its option
and in its discretion, to release any Lien granted to or held by the
Administrative Agent upon any Collateral (i) as described in Section 9.02(c);
(ii) as permitted by, but only in accordance with, the terms of the applicable
Loan Document; or (iii) if approved, authorized or ratified in writing by the
Required Lenders, unless such release is required to be approved by all of the
Lenders hereunder. Upon request by the Administrative Agent at any time, the
Lenders will confirm in writing the Administrative Agent’s authority to release
particular types or items of Collateral pursuant hereto. Upon any sale or
transfer of assets constituting Collateral which is permitted pursuant to the
terms of any Loan Document, or consented to in writing by the Required Lenders
or all of the Lenders, as applicable, and upon at least five (5) Business Days’
prior written request by the Borrower Representative to the Administrative
Agent, the Administrative Agent shall (and is hereby irrevocably authorized by
the Lenders to) execute such documents as may be necessary to evidence the
release of the Liens granted to the Administrative Agent for the benefit of the
Secured Parties herein or pursuant hereto upon the Collateral that was sold or
transferred; provided, however, that (i) the Administrative Agent shall not be
required to execute any such document on terms which, in the Administrative
Agent’s opinion, would expose the Administrative Agent to liability or create
any obligation or entail any consequence other than the release of such Liens
without recourse or warranty, and (ii) such release shall not in any manner
discharge, affect or impair the Secured Obligations or any Liens upon (or
obligations of the Company or any Subsidiary in respect of) all interests
retained by the Company or any Subsidiary, including (without limitation) the
proceeds of the sale, all of which shall continue to constitute part of the
Collateral.

 

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The Company, on its behalf and on behalf of its Subsidiaries, and each Lender,
on its behalf and on the behalf of its affiliated Secured Parties, hereby
irrevocably constitute the Administrative Agent as the holder of an irrevocable
power of attorney (fondé de pouvoir within the meaning of Article 2692 of the
Civil Code of Québec) in order to hold hypothecs and security granted by the
Company or any Subsidiary on property pursuant to the laws of the Province of
Quebec to secure obligations of the Company or any Subsidiary under any bond,
debenture or similar title of indebtedness issued by the Company or any
Subsidiary in connection with this Agreement, and agree that the Administrative
Agent may act as the bondholder and mandatary with respect to any bond,
debenture or similar title of indebtedness that may be issued by the Company or
any Subsidiary and pledged in favor of the Secured Parties in connection with
this Agreement. Notwithstanding the provisions of Section 32 of the An Act
respecting the special powers of legal persons (Quebec), JPMorgan Chase Bank,
N.A. as Administrative Agent may acquire and be the holder of any bond issued by
the Company or any Subsidiary in connection with this Agreement (i.e., the fondé
de pouvoir may acquire and hold the first bond issued under any deed of hypothec
by the Company or any Subsidiary).

The Administrative Agent is hereby authorized to execute and deliver any
documents necessary or appropriate to create and perfect the rights of pledge
for the benefit of the Secured Parties including a right of pledge with respect
to the entitlements to profits, the balance left after winding up and the voting
rights of the Company as ultimate parent of any subsidiary of the Company which
is organized under the laws of the Netherlands and the Equity Interests of which
are pledged in connection herewith (a “Dutch Pledge”). Without prejudice to the
provisions of this Agreement and the other Loan Documents, the parties hereto
acknowledge and agree with the creation of parallel debt obligations of the
Company or any relevant Subsidiary as will be described in any Dutch Pledge (the
“Parallel Debt”), including that any payment received by the Administrative
Agent in respect of the Parallel Debt will-conditionally upon such payment not
subsequently being avoided or reduced by virtue of any provisions or enactments
relating to bankruptcy, insolvency, preference, liquidation or similar laws of
general application-be deemed a satisfaction of a pro rata portion of the
corresponding amounts of the Obligations, and any payment to the Secured Parties
in satisfaction of the Obligations shall-conditionally upon such payment not
subsequently being avoided or reduced by virtue of any provisions or enactments
relating to bankruptcy, insolvency, preference, liquidation or similar laws of
general application-be deemed as satisfaction of the corresponding amount of the
Parallel Debt. The parties hereto acknowledge and agree that, for purposes of a
Dutch Pledge, any resignation by the Administrative Agent is not effective until
its rights under the Parallel Debt are assigned to the successor Administrative
Agent.

The parties hereto acknowledge and agree for the purposes of taking and ensuring
the continuing validity of German law governed pledges (Pfandrechte) with the
creation of parallel debt obligations of the Company and its Subsidiaries as
will be further described in a separate German law governed parallel debt
undertaking. The Administrative Agent shall (i) hold such parallel debt
undertaking as fiduciary agent (Treuhaender) and (ii) administer and hold as
fiduciary agent (Treuhaender) any pledge created under a German law governed
Collateral Document which is created in favor of any Secured Party or
transferred to any Secured Party due to its accessory nature (Akzessorietaet),
in each case in its own name and for the account of the Secured Parties. Each
Lender, on its own behalf and on behalf of its affiliated Secured Parties,
hereby authorizes the Administrative Agent to enter as its agent in its name and
on its behalf into any German law governed Collateral Document, to accept as its
agent in its name and on its behalf any pledge under such Collateral Document
and to agree to and execute as agent its in its name and on its behalf any
amendments, supplements and other alterations to any such Collateral Document
and to release any such Collateral Document and any pledge created under any
such Collateral Document in accordance with the provisions herein and/or the
provisions in any such Collateral Document.

 

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Each Secured Party hereby irrevocably appoints JPMorgan Chase Bank, N.A. as
Administrative Agent on the terms and conditions set forth in any Foreign
Security Agreement governed by English law to act as its trustee under and in
relation to any Foreign Security Agreement governed by English law and to hold
the assets subject to the security thereby created as trustee for the Secured
Parties on the trusts and other terms contained in any Foreign Security
Agreement governed by English law. Each Secured Party hereby irrevocably
authorizes JPMorgan Chase Bank, N.A., as Administrative Agent, to exercise such
rights, remedies, powers and discretions as are specifically delegated to it by
the terms of any Foreign Security Agreement governed by English law, together
with all such rights, remedies, powers and discretions as are reasonably
incidental thereto. Any reference in this Agreement to Liens or other security
interests stated to be in favor of the Administrative Agent shall be construed
so as to include a reference to Liens or other security interests granted in
favor of JPMorgan Chase Bank, N.A., as Administrative Agent.

Additionally, JPMorgan Chase Bank, N.A., as Administrative Agent, (or any
successor Administrative Agent in accordance with this Agreement) shall have,
subject always to the provisions of any Foreign Security Agreement governed by
English law, (a) all the powers of an absolute owner of the security constituted
by the Foreign Security Agreement governed by English law and (b) all the
rights, remedies and powers granted to it and be subject to all the obligations
and duties owed by it under the Foreign Security Agreement governed by English
law and/or any of the Loan Documents.

The Secured Parties agree that at any time that the beneficiary of the Liens
under any Foreign Security Agreement governed by English law shall be a Person
other than the Administrative Agent, such other Person shall have the rights,
remedies, benefits and powers granted to the Administrative Agent in this
Agreement or in any Foreign Security Agreement governed by English law. Nothing
in this Article VIII shall require JPMorgan Chase Bank, N.A., as Administrative
Agent, to act as a trustee at common law or to be holding any property on trust,
in any jurisdiction outside the United Kingdom which may not operate under
principles of trust or where such trust would not be recognized or its effects
would not be enforceable.

ARTICLE IX

Miscellaneous

SECTION 9.01. Notices. (a) Except in the case of notices and other
communications expressly permitted to be given by telephone (and subject to
paragraph (b) below), all notices and other communications provided for herein
shall be in writing and shall be delivered by hand or overnight courier service,
mailed by certified or registered mail (with facsimile numbers provided herein
for informational purposes only), as follows:

(i) if to any Loan Party, c/o the Company at Lifetime Brands, Inc., 1000 Stewart
Avenue, Garden City, New York 11530, Attention: Chief Financial Officer
(Telephone No. (516) 203- 3500);

(ii) if to the Administrative Agent, (A) in the case of any Dollar Tranche
Credit Event, to JPMorgan Chase Bank, N.A., 10 South Dearborn Street, Chicago,
Illinois 60603, Attention of Justin P Anderson (Telecopy No. 312-377-1100), with
a copy to JPMorgan Chase Bank, N.A., 270 Park Avenue, 44th Floor, New York, NY
10017, Attention of Robert A. Kaulius (Telecopy No. (646) 534-2288), (B) in the
case of any Multicurrency Tranche Credit Event, to J.P. Morgan

 

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Europe Limited, 125 London Wall, London EC2Y 5AJ, Attention of The Manager,
Loans Agency (Telecopy No. 44 207 777 2360), with a copy to JPMorgan Chase Bank,
N.A., 270 Park Avenue, 44th Floor, New York, NY 10017, Attention of Robert A.
Kaulius (Telecopy No. (646) 534-2288), and (C) in the case of all other notices
or communications, to JPMorgan Chase Bank, N.A., 270 Park Avenue, 44th Floor,
New York, NY 10017, Attention of Robert A. Kaulius (Telecopy No.
(646) 534-2288);

(iii) if to the Issuing Bank, to it at (A) in the case of Dollar Tranche Letters
of Credit, JPMorgan Chase Bank, N.A., 270 Park Avenue, Floor 44, New York, NY,
10017, Attention of Deokie D. Basanta (Telecopy No. 646-534-2274) and (B) in the
case of Multicurrency Tranche Letters of Credit, J.P. Morgan Europe Limited, 125
London Wall, London EC2Y 5AJ, Attention of The Manager, Loans Agency (Telecopy
No. 44 207 777 2360);

(iv) if to the Swingline Lender, (A) in the case of Swingline Loans made on
behalf of the Dollar Tranche Lenders, to it at JPMorgan Chase Bank, N.A., 10
South Dearborn Street, Chicago, Illinois 60603, Attention of Justin P Anderson
(Telecopy No. 312-377-1100) and (B) in the case of Swingline Loans made on
behalf of the Multicurrency Tranche Lenders, to it at J.P. Morgan Europe
Limited, 125 London Wall, London EC2Y 5AJ, Attention of The Manager, Loans
Agency (Telecopy No. 44 207 777 2360);

(v) if to the Co-Collateral Agents, to each at: (A) JPMorgan Chase Bank, N.A.,
270 Park Avenue, 44th Floor, New York, NY 10017, Attention of Robert A. Kaulius
(Telecopy No. (646) 534-2288) and (B) HSBC Bank USA, National Association, 452
Fifth Avenue, New York, NY 10018, Attention of Steven A. Alves (Telecopy No.
(212) 525-2520); and

(vi) if to any other Lender, to it at its address (or telecopy number) set forth
in its Administrative Questionnaire.

All such notices and other communications (i) sent by hand or overnight courier
service, or mailed by certified or registered mail, shall be deemed to have been
given when received or (ii) sent by facsimile shall be deemed to have been given
when sent, provided that if not given during normal business hours for the
recipient, shall be deemed to have been given at the opening of business on the
next Business Day for the recipient.

(b) Notices and other communications to the Lenders hereunder may be delivered
or furnished by electronic communications (including e-mail and internet or
intranet websites) pursuant to procedures approved by the Administrative Agent;
provided that the foregoing shall not apply to notices pursuant to Article II or
to compliance and no Event of Default certificates delivered pursuant to Section
5.01(d) unless otherwise agreed by the Administrative Agent and the applicable
Lender. The Administrative Agent or the Borrower Representative (on behalf of
the Loan Parties) may, in its discretion, agree to accept notices and other
communications to it hereunder by electronic communications pursuant to
procedures approved by it; provided that approval of such procedures may be
limited to particular notices or communications. All such notices and other
communications (i) sent to an e-mail address shall be deemed received upon the
sender’s receipt of an acknowledgement from the intended recipient (such as by
the “return receipt requested” function, as available, return e- mail or other
written acknowledgement); provided that if not given during the normal business
hours of the recipient, such notice or communication shall be deemed to have
been given at the opening of business on the next Business Day for the
recipient, and (ii) posted to an Internet or intranet website shall be deemed
received upon the deemed receipt by the intended recipient at its e-mail address
as described in the foregoing clause (b)(i) of notification that such notice or
communication is available and identifying the website address therefor.

 

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

SECTION 9.02. Waivers; Amendments. (a) No failure or delay by the Administrative
Agent, the Issuing Bank or any Lender in exercising any right or power hereunder
or under any other Loan Document 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, the Issuing Bank and the Lenders
hereunder and under any other Loan Document are cumulative and are not exclusive
of any rights or remedies that they would otherwise have. No waiver of any
provision of any Loan Document or consent to any departure by any Loan Party
therefrom shall in any event be effective unless the same shall be permitted by
paragraph (b) of this Section, and then such waiver or consent shall be
effective only in the specific instance and for the purpose for which given.
Without limiting the generality of the foregoing, the making of a Loan or
issuance of a Letter of Credit shall not be construed as a waiver of any
Default, regardless of whether the Administrative Agent, any Lender or the
Issuing Bank may have had notice or knowledge of such Default at the time.

(b) 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 Company and the Required Lenders; provided that no such agreement shall
(i) increase the Commitment of any Lender without the written consent of such
Lender (provided that the Administrative Agent may make Protective Advances as
set forth in Section 2.05), (ii) reduce or forgive the principal amount of any
Loan or LC Disbursement or reduce the rate of interest thereon, or reduce or
forgive any interest or fees payable hereunder, without the written consent of
each Lender directly affected thereby, (iii) postpone any scheduled date of
payment of the principal amount of any Loan or LC Disbursement, or any date for
the payment of any interest, fees or other Obligations payable hereunder, or
reduce the amount of, waive or excuse any such payment, or postpone the
scheduled date of expiration of any Commitment, without the written consent of
each Lender directly affected thereby, (iv) change Section 2.19(b) or (d) in a
manner that would alter the manner in which payments are shared, without the
written consent of each Lender, (v) increase the advance rates above the maximum
percentage amounts set forth in the definition of Domestic Borrowing Base or
Foreign Borrowing Base or add new categories of eligible assets, without the
written consent of each Lender, (vi) change any of the provisions of this
Section or the definition of “Required Lenders” or any other provision of any
Loan Document specifying the number or percentage of Lenders required to waive,
amend or modify any rights thereunder or make any determination or grant any
consent thereunder, without the written consent of each Lender, (vii) change
Section 2.21, without the consent of each Lender (other than any Defaulting
Lender), (viii) release any Loan Guarantor from its obligation under its Loan
Guaranty (except as otherwise permitted herein or in the other Loan Documents),
without the written consent of each Lender, or (ix) except as provided in
clauses (d) and (e) of this Section or in any Collateral Document, release all
or substantially all of the Collateral, without the written consent of each
Lender; provided further that no such agreement shall amend, modify or otherwise
affect the rights or duties of the Administrative Agent, the Issuing Bank or the
Swingline Lender hereunder without the prior written consent of the
Administrative Agent, the Issuing Bank or the Swingline Lender, as the case may
be (it being understood that any change to Section 2.21 shall require the
consent of the Administrative Agent, the Swingline Lender and the Issuing Bank).
The Administrative Agent may also amend Schedule 2.01 to reflect assignments
entered into pursuant to Section 9.04

(c) The Lenders hereby irrevocably authorize the Administrative Agent, at its
option and in its sole discretion, to release any Liens granted to the
Administrative Agent by the Loan Parties on any Collateral (i) upon the
termination of the Commitments, payment and satisfaction in full in cash

 

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of all Secured Obligations (other than Unliquidated Obligations), and the cash
collateralization of all Unliquidated Obligations in a manner satisfactory to
the Administrative Agent, (ii) constituting property being sold or disposed of
if the Loan Party disposing of such property certifies to the Administrative
Agent that the sale or disposition is made in compliance with the terms of this
Agreement (and the Administrative Agent may rely conclusively on any such
certificate, without further inquiry), and to the extent that the property being
sold or disposed of constitutes 100% of the Equity Interest of a Subsidiary, the
Administrative Agent is authorized to release any Loan Guaranty provided by such
Subsidiary, (iii) constituting property leased to a Loan Party under a lease
which has expired or been terminated in a transaction permitted under this
Agreement, or (iv) as required to effect any sale or other disposition of such
Collateral in connection with any exercise of remedies of the Administrative
Agent and the Lenders pursuant to Article VII. Except as provided in the
preceding sentence, the Administrative Agent will not release any Liens on
Collateral without the prior written authorization of the Required Lenders;
provided that, the Administrative Agent may in its discretion, release its Liens
on Collateral valued in the aggregate not in excess of $5,000,000 during any
calendar year without the prior written authorization of the Required Lenders.
Any such release shall not in any manner discharge, affect, or impair the
Obligations or any Liens (other than those expressly being released) upon (or
obligations of the Loan Parties in respect of) all interests retained by the
Loan Parties, including the proceeds of any sale, all of which shall continue to
constitute part of the Collateral.

(d) If, in connection with any proposed amendment, waiver or consent requiring
the consent of “each Lender” or “each Lender directly affected thereby,” the
consent of the Required Lenders is obtained, but the consent of other necessary
Lenders is not obtained (any such Lender whose consent is necessary but not
obtained being referred to herein as a “Non-Consenting Lender”), then the
Company may elect to replace a Non-Consenting Lender as a Lender party to this
Agreement; provided that, concurrently with such replacement, (i) another bank
or other entity which is reasonably satisfactory to the Company and the
Administrative Agent shall agree, as of such date, to purchase for cash the
Loans and other Obligations due to the Non-Consenting Lender pursuant to an
Assignment and Assumption and to become a Lender for all purposes under this
Agreement and to assume all obligations of the Non-Consenting Lender to be
terminated as of such date and to comply with the requirements of clause (b) of
Section 9.04, and (ii) each Borrower shall pay to such Non-Consenting Lender in
same day funds on the day of such replacement (1) all interest, fees and other
amounts then accrued but unpaid to such Non-Consenting Lender by such Borrower
hereunder to and including the date of termination, including without limitation
payments due to such Non-Consenting Lender under Sections 2.15 and 2.17, and
(2) an amount, if any, equal to the payment which would have been due to such
Lender on the day of such replacement under Section 2.17 had the Loans of such
Non-Consenting Lender been prepaid on such date rather than sold to the
replacement Lender.

(e) Notwithstanding anything to the contrary herein the Administrative Agent
may, with the consent of the Borrowers only, amend, modify or supplement this
Agreement or any of the other Loan Documents to cure any ambiguity, omission,
mistake, defect or inconsistency.

SECTION 9.03. Expenses; Indemnity; Damage Waiver. (a) The Company shall pay
(i) all reasonable out of pocket expenses incurred by the Administrative Agent
and its Affiliates, including the reasonable fees, charges and disbursements of
counsel for the Administrative Agent, in connection with the syndication and
distribution (including, without limitation, via the internet or through a
service such as Intralinks) of the credit facilities provided for herein, the
preparation and administration of the Loan Documents or any amendments,
modifications or waivers of the provisions of the Loan Documents (whether or not
the transactions contemplated hereby or thereby shall be consummated), (ii) all
reasonable out-of-pocket expenses incurred by the Issuing Bank in connection
with the issuance, amendment, renewal or extension of any Letter of Credit or
any demand for payment thereunder and (iii)

 

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all out-of-pocket expenses incurred by the Administrative Agent, any
Co-Collateral Agent, the Issuing Bank or any Lender, including the fees, charges
and disbursements of any counsel for the Administrative Agent, the Issuing Bank
or any Lender, in connection with the enforcement, collection or protection of
its rights in connection with the Loan Documents, including its rights under
this Section, or in connection with the Loans made or Letters of Credit issued
hereunder, including all such out-of pocket expenses incurred during any
workout, restructuring or negotiations in respect of such Loans or Letters of
Credit. Expenses being reimbursed by the Borrowers under this Section include,
without limiting the generality of the foregoing, fees, costs and expenses
incurred in connection with:

(i) inventory and trademark appraisals and insurance and environmental reviews;

(ii) field examinations and the preparation of Reports based on the fees charged
by a third party retained by the Administrative Agent or a Co-Collateral Agent
or the internally allocated fees for each Person employed by the Administrative
Agent or a Co-Collateral Agent with respect to each field examination;

(iii) taxes, fees and other charges for (A) lien searches and (B) filing
financing statements and continuations, and other actions to perfect, protect,
and continue the Administrative Agent’s Liens;

(iv) sums paid or incurred to take any action required of any Loan Party under
the Loan Documents that such Loan Party fails to pay or take; and

(v) forwarding loan proceeds, collecting checks and other items of payment, and
establishing and maintaining the accounts and lock boxes, and costs and expenses
of preserving and protecting the Collateral (including costs and expenses in
relation to any Deposit Account Control Agreement).

All of the foregoing fees, costs and expenses may be charged to the Borrowers as
Revolving Loans or to another deposit account, all as described in
Section 2.19(c).

(b) The Company shall indemnify the Administrative Agent, each Co-Collateral
Agent, the Issuing Bank and each Lender, and each Related Party of any of the
foregoing Persons (each such Person being called an “Indemnitee”) against, and
hold each Indemnitee harmless from, any and all losses, claims, damages,
penalties, incremental taxes, liabilities and related expenses, including the
fees, charges and disbursements of any counsel for any Indemnitee, incurred by
or asserted against any Indemnitee arising out of, in connection with, or as a
result of (i) the execution or delivery of the Loan Documents or any agreement
or instrument contemplated thereby, the performance by the parties hereto of
their respective obligations thereunder or the consummation of the Transactions
or any other transactions contemplated hereby, (ii) any Loan or Letter of Credit
or the use of the proceeds therefrom (including any refusal by the Issuing Bank
to honor a demand for payment under a Letter of Credit if the documents
presented in connection with such demand do not strictly comply with the terms
of such Letter of Credit), (iii) any actual or alleged presence or release of
Hazardous Materials on or from any property owned or operated by the Company or
any of its Subsidiaries, or any Environmental Liability related in any way to
the Company or any of its Subsidiaries, (iv) the failure of the Borrowers to
deliver to the Administrative Agent the required receipts or other required
documentary evidence with respect to a payment made by the Borrowers for Taxes
pursuant to Section 2.18, or (v) any actual or prospective claim, litigation,
investigation or proceeding relating to any of the foregoing, whether based on
contract, tort or any other theory and regardless of whether any Indemnitee is a
party thereto; provided that such indemnity shall not, as to any Indemnitee, be
available to the extent that such losses, claims, damages, penalties,
liabilities or related expenses are

 

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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. This Section 9.03(b) shall not apply with respect to Taxes or
U.K Taxes other than any Taxes or U.K. Taxes that represent losses or damages
arising from any non-Tax or non-U.K. Tax claim.

(c) To the extent that the Borrowers fail to pay any amount required to be paid
by it to the Administrative Agent, any Co-Collateral Agent, the Issuing Bank or
the Swingline Lender under paragraph (a) or (b) of this Section, each Lender
severally agrees to pay to the Administrative Agent, such Co-Collateral Agent,
the Issuing Bank or the Swingline Lender, as the case may be, such Lender’s
Applicable Percentage (determined as of the time that the applicable
unreimbursed expense or indemnity payment is sought) of such unpaid amount (it
being understood that any Borrower’s failure to pay any such amount shall not
relieve such Borrower of any default in the payment thereof); provided that the
unreimbursed expense or indemnified loss, claim, damage, penalty, liability or
related expense, as the case may be, was incurred by or asserted against the
Administrative Agent, such Co-Collateral Agent, the Issuing Bank or the
Swingline Lender in its capacity as such.

(d) To the extent permitted by applicable law, no Loan Party shall assert, and
each hereby waives, any claim against any Indemnitee, on any theory of
liability, for special, indirect, consequential or punitive damages (as opposed
to direct or actual damages) arising out of, in connection with, or as a result
of, this Agreement or any agreement or instrument contemplated hereby, the
Transactions, any Loan or Letter of Credit or the use of the proceeds thereof.

(e) All amounts due under this Section shall be payable not later than fifteen
(15) days after written demand therefor.

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) no Borrower
may 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 any 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. Nothing in this Agreement,
expressed or implied, shall be construed to confer upon any Person (other than
the parties hereto, their respective successors and assigns permitted hereby
(including any Affiliate of the Issuing Bank that issues any Letter of Credit),
Participants (to the extent provided in paragraph (c) of this Section) and, to
the extent expressly contemplated hereby, the Related Parties of each of the
Administrative Agent, the Issuing Bank and the Lenders) any legal or equitable
right, remedy or claim under or by reason of this Agreement.

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

(A) the Borrower Representative; provided that, the Borrower Representative
shall be deemed to have consented to any such assignment unless it shall object
thereto by written notice to the Administrative Agent within five (5) Business
Days after having received notice thereof and provided further that no consent
of the Borrower Representative shall be required for an assignment to a Lender,
an Affiliate of a Lender, an Approved Fund or, if an Event of Default has
occurred and is continuing, any other assignee;

(B) the Administrative Agent; and

 

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(C) the Issuing Bank.

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

(A) except in the case of an assignment to a Lender or an Affiliate of a Lender
or an assignment of the entire remaining amount of the assigning Lender’s
Commitment or Loans of any Class, the amount of the Commitment or Loans of the
assigning Lender subject to each such assignment (determined as of the date the
Assignment and Assumption with respect to such assignment is delivered to the
Administrative Agent) shall not be less than $5,000,000 unless each of the
Borrower Representative and the Administrative Agent otherwise consent; provided
that no such consent of the Borrower Representative shall be required if an
Event of Default has occurred and is continuing;

(B) each partial assignment shall be made as an assignment of a proportionate
part of all the assigning Lender’s rights and obligations under this Agreement;

(C) the parties to each assignment shall execute and deliver to the
Administrative Agent an Assignment and Assumption, together with a processing
and recordation fee of $3,500, such fee to be paid by either the assigning
Lender or the assignee Lender or shared between such Lenders; and

(D) the assignee, if it shall not be a Lender, shall deliver to the
Administrative Agent an Administrative Questionnaire in which the assignee
designates one or more Credit Contacts to whom all syndicate-level information
(which may contain material non-public information about the Company, the other
Loan Parties and their Related Parties or their respective securities) will be
made available and who may receive such information in accordance with the
assignee’s compliance procedures and applicable laws, including Federal and
state securities laws.

For the purposes of this Section 9.04(b), the term “Approved Fund” has the
following meaning:

“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 of its business and that is administered or
managed by (a) a Lender, (b) an Affiliate of a Lender or (c) an entity or an
Affiliate of an entity that administers or manages a Lender.

(iii) Subject to acceptance and recording thereof pursuant to paragraph (b)(iv)
of this Section, from and after the effective date specified in each Assignment
and Assumption the assignee thereunder shall be a party hereto and, to the
extent of the interest assigned by such Assignment and Assumption, 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 Assumption, be released from its obligations under this Agreement
(and, in the case of an Assignment and Assumption covering all of the assigning
Lender’s rights and obligations under this Agreement, such Lender shall cease to
be a party hereto but shall continue to be entitled to the benefits of Sections
2.16, 2.17, 2.18 and 9.03). 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.

(iv) The Administrative Agent, acting for this purpose as an agent of the
Borrowers, shall maintain at one of its offices a copy of each Assignment and
Assumption delivered to it and a register for the recordation of the names and
addresses of the Lenders, and the Commitment of, and principal amount of the
Loans and LC Disbursements owing to, each Lender pursuant to the

 

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terms hereof from time to time (the “Register”). The entries in the Register
shall be conclusive, and the Borrowers, 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, notwithstanding notice to the contrary. The Register shall be
available for inspection by the Borrowers, 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 Assumption 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 Assumption
and record the information contained therein in the Register; provided that if
either the assigning Lender or the assignee shall have failed to make any
payment required to be made by it pursuant to Section 2.06, 2.07(d) or (e),
2.08(b), 2.19(d) or 9.03(c), the Administrative Agent shall have no obligation
to accept such Assignment and Assumption and record the information therein in
the Register unless and until such payment shall have been made in full,
together with all accrued interest thereon. No assignment shall be effective for
purposes of this Agreement unless it has been recorded in the Register as
provided in this paragraph.

(vi) Any Lender may, without the consent of any Borrower, the Administrative
Agent, the Issuing Bank or the Swingline Lender, 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 Commitment 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 Borrowers, 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 or instrument pursuant to which a Lender sells such a
participation shall provide that such Lender shall retain the sole right to
enforce this Agreement and to approve any amendment, modification or waiver of
any provision of this Agreement; provided that such agreement or instrument may
provide that such Lender will not, without the consent of the Participant, agree
to any amendment, modification or waiver described in the first proviso to
Section 9.02(b) that affects such Participant. Each Borrower agrees that each
Participant shall be entitled to the benefits of Sections 2.16, 2.17 and 2.18
(subject to the requirements and limitations therein, including the requirements
under Section 2.18(f) (it being understood that the documentation required under
Section 2.18(f) shall be delivered to the participating Lender)) to the same
extent as if it were a Lender and had acquired its interest by assignment
pursuant to paragraph (b) of this Section; provided that such Participant
(A) agrees to be subject to the provisions of Sections 2.19 and 2.20 as if it
were an assignee under paragraph (b) of this Section; and (B) shall not be
entitled to receive any greater payment under Sections 2.16 or 2.18, with
respect to any participation, than its participating Lender would have been
entitled to receive, except to the extent such entitlement to receive a greater
payment results from a Change in Law that occurs after the Participant acquired
the applicable participation. To the extent permitted by law, each Participant
also shall be entitled to the benefits of Section 9.08 as though it were a
Lender, provided such Participant agrees to be subject to Section 2.19(d) as
though it were a Lender. Each Lender that sells a participation shall, acting
solely for this purpose as an agent of the Borrowers, maintain a register on
which it enters the name and address of each Participant and the principal
amounts (and stated interest) of each Participant’s interest in the Loans or
other obligations under this Agreement (the “Participant Register”); provided
that no Lender shall have any obligation to disclose all or any portion of the

 

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Participant Register to any Person (including the identity of any Participant or
any information relating to a Participant’s interest in any Commitments, Loans,
Letters of Credit or its other obligations under any this Agreement) except to
the extent that such disclosure is necessary to establish that such Commitment,
Loan, Letter of Credit or other obligation is in registered form under
Section 5f.103-1(c) of the United States Treasury Regulations. The entries in
the Participant Register shall be conclusive absent manifest error, and such
Lender shall treat each person whose name is recorded in the Participant
Register as the owner of such participation for all purposes of this Agreement
notwithstanding any notice to the contrary.

(c) Any Lender may at any time pledge or assign a security interest in all or
any portion of its rights under this Agreement to secure obligations of such
Lender, including without limitation any pledge or assignment to secure
obligations to a Federal Reserve Bank, and this Section 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.

SECTION 9.05. Survival. All covenants, agreements, representations and
warranties made by the Loan Parties in the Loan Documents and in the
certificates or other instruments delivered in connection with or pursuant to
this Agreement or any other Loan Document shall be considered to have been
relied upon by the other parties hereto and shall survive the execution and
delivery of the Loan Documents and the making of any Loans and issuance of any
Letters of Credit, regardless of any investigation made by any such other party
or on its behalf and notwithstanding that the Administrative Agent, the Issuing
Bank or any Lender may have had notice or knowledge of any Default or incorrect
representation or warranty at the time any credit is extended hereunder, and
shall continue in full force and effect as long as the principal of or any
accrued interest on any Loan or any fee or any other amount payable under this
Agreement is outstanding and unpaid or any Letter of Credit is outstanding and
so long as the Commitments have not expired or terminated. The provisions of
Sections 2.16, 2.17, 2.18 and 9.03 and Article VIII shall survive and remain in
full force and effect regardless of the consummation of the transactions
contemplated hereby, the repayment of the Loans, the expiration or termination
of the Letters of Credit and the Commitments or the termination of this
Agreement or any other Loan Document or any provision hereof or thereof.

SECTION 9.06. Counterparts; Integration; Effectiveness. This Agreement may be
executed in counterparts (and by different parties hereto on different
counterparts), each of which shall constitute an original, but all of which when
taken together shall constitute a single contract. This Agreement, the other
Loan Documents and any separate letter agreements with respect to fees payable
to the Administrative Agent constitute the entire contract among the parties
relating to the subject matter hereof and supersede any and all previous
agreements and understandings, oral or written, relating to the subject matter
hereof. Except as provided in Section 4.01, this Agreement shall become
effective when it shall have been executed by the Administrative Agent and when
the Administrative Agent shall have received counterparts 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 parties hereto
and their respective successors and assigns. Delivery of an executed counterpart
of a signature page of this Agreement by facsimile shall be effective as
delivery of a manually executed counterpart of this Agreement.

SECTION 9.07. Severability. Any provision of any Loan Document held to be
invalid, illegal or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such invalidity, illegality or
unenforceability without affecting the validity, legality and enforceability of
the remaining provisions thereof; and the invalidity of a particular provision
in a particular jurisdiction shall not invalidate such provision in any other
jurisdiction.

 

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SECTION 9.08. Right of Setoff. If an Event of Default shall have occurred and be
continuing, each Lender and each of its Affiliates 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 obligations at any time owing by such
Lender or Affiliate to or for the credit or the account of the Borrowers or any
Loan Guarantor against any of and all the Secured Obligations held by such
Lender, irrespective of whether or not such Lender shall have made any demand
under the Loan Documents and although such obligations may be unmatured. The
applicable Lender shall notify the Borrower Representative and the
Administrative Agent of such set-off or application; provided that any failure
to give or any delay in giving such notice shall not affect the validity of any
such set-off or application under this Section. The rights of each Lender under
this Section are in addition to other rights and remedies (including other
rights of setoff) which such Lender may have.

SECTION 9.09. Governing Law; Jurisdiction; Consent to Service of Process.
(a) The Loan Documents shall be construed in accordance with and governed by the
law of the State of New York, but giving effect to federal laws applicable to
national banks.

(b) Each of the Loan Parties, the Administrative Agent, the Issuing Bank and the
Lenders hereby irrevocably and unconditionally submits, for itself and its
property, to the nonexclusive jurisdiction of any U.S. Federal or New York State
court sitting in New York, New York in any action or proceeding arising out of
or relating to any Loan Document, or for recognition or enforcement of any
judgment arising out of or relating to any Loan Document, 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 or
any other Loan Document shall affect any right that the Administrative Agent,
the Issuing Bank or any Lender may otherwise have to bring any action or
proceeding relating to this Agreement or any other Loan Document against any
Loan Party or its properties in the courts of any jurisdiction.

(c) Each of the Loan Parties, the Administrative Agent, the Issuing Bank and the
Lenders 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 court referred to
in paragraph (b) of this Section. 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.

(d) Each party to this Agreement irrevocably consents to service of process in
the manner provided for notices in Section 9.01. Each Foreign Subsidiary
Borrower irrevocably designates and appoints the Company, as its authorized
agent, to accept and acknowledge on its behalf, service of any and all process
which may be served in any suit, action or proceeding of the nature referred to
in Section 9.09(b) in any federal or New York State court sitting in New York
City. The Company hereby represents, warrants and confirms that the Company has
agreed to accept such appointment (and any similar appointment by a Loan
Guarantor which is a Foreign Subsidiary). Said designation and appointment shall
be irrevocable by each such Foreign Subsidiary Borrower until all Loans, all
reimbursement obligations, interest thereon and all other amounts payable by
such Foreign Subsidiary Borrower hereunder and under the other Loan Documents
shall have been paid in full in accordance with the provisions hereof and
thereof and such Foreign Subsidiary Borrower shall have been terminated as a
Borrower hereunder pursuant to Section 2.24. Each Foreign Subsidiary Borrower

 

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hereby consents to process being served in any suit, action or proceeding of the
nature referred to in Section 9.09(b) in any federal or New York State court
sitting in New York City by service of process upon the Company as provided in
this Section 9.09(d); provided that, to the extent lawful and possible, notice
of said service upon such agent shall be mailed by registered or certified air
mail, postage prepaid, return receipt requested, to the Company and (if
applicable to) such Foreign Subsidiary Borrower at its address set forth in the
Borrowing Subsidiary Agreement to which it is a party or to any other address of
which such Foreign Subsidiary Borrower shall have given written notice to the
Administrative Agent (with a copy thereof to the Company). Each Foreign
Subsidiary Borrower irrevocably waives, to the fullest extent permitted by law,
all claim of error by reason of any such service in such manner and agrees that
such service shall be deemed in every respect effective service of process upon
such Foreign Subsidiary Borrower in any such suit, action or proceeding and
shall, to the fullest extent permitted by law, be taken and held to be valid and
personal service upon and personal delivery to such Foreign Subsidiary Borrower.
To the extent any Foreign Subsidiary Borrower has or hereafter may acquire any
immunity from jurisdiction of any court or from any legal process (whether from
service or notice, attachment prior to judgment, attachment in aid of execution
of a judgment, execution or otherwise), each Foreign Subsidiary Borrower hereby
irrevocably waives such immunity in respect of its obligations under the Loan
Documents. Nothing in this Agreement or any other Loan Document will affect the
right of any party to this Agreement to serve process in any other manner
permitted by law.

SECTION 9.10. 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 ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING
TO THIS AGREEMENT, ANY OTHER LOAN DOCUMENT OR THE TRANSACTIONS CONTEMPLATED
HEREBY OR THEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY). EACH
PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY
OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD
NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND
(B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER
INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND
CERTIFICATIONS IN THIS SECTION.

SECTION 9.11. 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 shall not affect the construction of, or be taken into
consideration in interpreting, this Agreement.

SECTION 9.12. Confidentiality. Each of the Administrative Agent, the Issuing
Bank and the Lenders agrees to maintain the confidentiality of the Information
(as defined below), except that Information may be disclosed (a) to its and its
Affiliates’ directors, officers, employees and agents, including accountants,
legal counsel and other advisors (it being understood that the Persons to whom
such disclosure is made will be informed of the confidential nature of such
Information and instructed to keep such Information confidential), (b) to the
extent requested by any regulatory authority, (c) to the extent required by
Requirement of Law or by any subpoena or similar legal process, (d) to any other
party to this Agreement, (e) in connection with the exercise of any remedies
hereunder or any suit, action or proceeding relating to this Agreement or any
other Loan Document or the enforcement of rights hereunder or thereunder,
(f) subject to an agreement containing provisions substantially the same as
those of this Section, to (i) any assignee of or Participant in, or any
prospective assignee of or Participant in, any of its rights or obligations
under this Agreement or (ii) any actual or prospective counterparty (or its
advisors) to any swap or derivative transaction relating to the Loan Parties and
their obligations, (g) with the consent of the Borrower Representative or (h) to
the extent such Information (i) becomes publicly

 

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available other than as a result of a breach of this Section or (ii) becomes
available to the Administrative Agent, the Issuing Bank or any Lender on a
non-confidential basis from a source other than the Borrowers. For the purposes
of this Section, “Information” means all information received from the Borrowers
relating to the Borrowers or their business, other than any such information
that is available to the Administrative Agent, the Issuing Bank or any Lender on
a non-confidential basis prior to disclosure by the Borrowers; provided that, in
the case of information received from the Borrowers after the date hereof, such
information is clearly identified at the time of delivery as confidential. Any
Person required to maintain the confidentiality of Information as provided in
this Section shall be considered to have complied with its obligation to do so
if such Person has exercised the same degree of care to maintain the
confidentiality of such Information as such Person would accord to its own
confidential information.

EACH LENDER ACKNOWLEDGES THAT INFORMATION AS DEFINED IN SECTION 9.12 FURNISHED
TO IT PURSUANT TO THIS AGREEMENT MAY INCLUDE MATERIAL NON-PUBLIC INFORMATION
CONCERNING THE COMPANY AND ITS AFFILIATES AND THEIR RELATED PARTIES OR THEIR
RESPECTIVE SECURITIES, AND CONFIRMS THAT IT HAS DEVELOPED COMPLIANCE PROCEDURES
REGARDING THE USE OF MATERIAL NON-PUBLIC INFORMATION AND THAT IT WILL HANDLE
SUCH MATERIAL NON-PUBLIC INFORMATION IN ACCORDANCE WITH THOSE PROCEDURES AND
APPLICABLE LAW, INCLUDING FEDERAL AND STATE SECURITIES LAWS.

ALL INFORMATION, INCLUDING REQUESTS FOR WAIVERS AND AMENDMENTS, FURNISHED BY THE
BORROWERS OR THE ADMINISTRATIVE AGENT PURSUANT TO, OR IN THE COURSE OF
ADMINISTERING, THIS AGREEMENT WILL BE SYNDICATE-LEVEL INFORMATION, WHICH MAY
CONTAIN MATERIAL NON-PUBLIC INFORMATION ABOUT THE COMPANY, THE LOAN PARTIES AND
THEIR RELATED PARTIES OR THEIR RESPECTIVE SECURITIES. ACCORDINGLY, EACH LENDER
REPRESENTS TO THE BORROWERS AND THE ADMINISTRATIVE AGENT THAT IT HAS IDENTIFIED
IN ITS ADMINISTRATIVE QUESTIONNAIRE A CREDIT CONTACT WHO MAY RECEIVE INFORMATION
THAT MAY CONTAIN MATERIAL NON-PUBLIC INFORMATION IN ACCORDANCE WITH ITS
COMPLIANCE PROCEDURES AND APPLICABLE LAW, INCLUDING FEDERAL AND STATE SECURITIES
LAWS.

SECTION 9.13. Several Obligations; Nonreliance; Violation of Law. The respective
obligations of the Lenders hereunder are several and not joint and the failure
of any Lender to make any Loan or perform any of its obligations hereunder shall
not relieve any other Lender from any of its obligations hereunder. Each Lender
hereby represents that it is not relying on or looking to any margin stock for
the repayment of the Borrowings provided for herein. Anything contained in this
Agreement to the contrary notwithstanding, neither the Issuing Bank nor any
Lender shall be obligated to extend credit to the Borrowers in violation of any
Requirement of Law.

SECTION 9.14. USA PATRIOT Act. Each Lender that is subject to the requirements
of the USA Patriot Act (Title III of Pub. L. 107-56 (signed into law October 26,
2001)) (the “Act”) hereby notifies the Borrowers that pursuant to the
requirements of the Act, it is required to obtain, verify and record information
that identifies the Borrowers, which information includes the name and address
of the Borrowers and other information that will allow such Lender to identify
the Borrowers in accordance with the Act.

 

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SECTION 9.15. Disclosure. Each Loan Party and each Lender hereby acknowledges
and agrees that the Administrative Agent and/or its Affiliates from time to time
may hold investments in, make other loans to or have other relationships with
any of the Loan Parties and their respective Affiliates.

SECTION 9.16. Appointment for Perfection. Each Lender hereby appoints each other
Lender as its agent for the purpose of perfecting Liens, for the benefit of the
Administrative Agent and the Lenders, in assets which, in accordance with
Article 9 of the UCC or any other applicable law can be perfected only by
possession. Should any Lender (other than the Administrative Agent) obtain
possession of any such Collateral, such Lender shall notify the Administrative
Agent thereof, and, promptly upon the Administrative Agent’s request therefor
shall deliver such Collateral to the Administrative Agent or otherwise deal with
such Collateral in accordance with the Administrative Agent’s instructions.

SECTION 9.17. Interest Rate Limitation. Notwithstanding anything herein to the
contrary, if at any time the interest rate applicable to any Loan, together with
all fees, charges and other amounts which are treated as interest on such Loan
under applicable law (collectively the “Charges”), shall exceed the maximum
lawful rate (the “Maximum Rate”) which may be contracted for, charged, taken,
received or reserved by the Lender holding such Loan in accordance with
applicable law, the rate of interest payable in respect of such Loan hereunder,
together with all Charges payable in respect thereof, shall be limited to the
Maximum Rate and, to the extent lawful, the interest and Charges that would have
been payable in respect of such Loan but were not payable as a result of the
operation of this Section shall be cumulated and the interest and Charges
payable to such Lender in respect of other Loans or periods shall be increased
(but not above the Maximum Rate therefor) until such cumulated amount, together
with interest thereon at the Federal Funds Effective Rate to the date of
repayment, shall have been received by such Lender.

ARTICLE X

Loan Guaranty

SECTION 10.01. Guaranty. Subject to Section 10.13 hereof, each Loan Guarantor
(other than those that have delivered a separate Guarantee) hereby agrees that
it is jointly and severally liable for, and, as primary obligor and not merely
as surety, absolutely and unconditionally guarantees to the Lenders the prompt
payment when due, whether at stated maturity, upon acceleration or otherwise,
and at all times thereafter, of the Secured Obligations and all costs and
expenses including, without limitation, all court costs and attorneys’ and
paralegals’ fees (including allocated costs of in-house counsel and paralegals)
and expenses paid or incurred by the Administrative Agent, the Issuing Bank and
the Lenders in endeavoring to collect all or any part of the Secured Obligations
from, or in prosecuting any action against, any Borrower, any Loan Guarantor or
any other guarantor of all or any part of the Secured Obligations (such costs
and expenses, together with the Secured Obligations, collectively the
“Guaranteed Obligations”). Each Loan Guarantor further agrees that the
Guaranteed Obligations may be extended or renewed in whole or in part without
notice to or further assent from it, and that it remains bound upon its
guarantee notwithstanding any such extension or renewal. All terms of this Loan
Guaranty apply to and may be enforced by or on behalf of any domestic or foreign
branch or Affiliate of any Lender that extended any portion of the Guaranteed
Obligations. Subject to Section 10.13 hereof, each Borrower irrevocably and
unconditionally jointly and severally agrees that if any obligation guaranteed
by it is or becomes unenforceable, invalid or illegal, it will, as an
independent and primary obligation, indemnify the Administrative Agent, the
Issuing Bank and the Lenders immediately on demand against any cost, loss or
liability they incur as a result of any Borrower not paying any amount which
would, but for such unenforceability, invalidity or illegality, have been
payable by it under this Article X on the date when it would have been due (but
so that the amount payable by a Borrower under this indemnity will not exceed
the amount it would have had to pay under this Article X if the amount claimed
had been recoverable on the basis of a Guarantee).

 

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SECTION 10.02. Guaranty of Payment. This Loan Guaranty is a guaranty of payment
and not of collection. Each Loan Guarantor waives any right to require the
Administrative Agent, the Issuing Bank or any Lender to sue any Borrower, any
Loan Guarantor, any other guarantor, or any other person obligated for all or
any part of the Guaranteed Obligations (each, an “Obligated Party”), or
otherwise to enforce its payment against any collateral securing all or any part
of the Guaranteed Obligations.

SECTION 10.03. No Discharge or Diminishment of Loan Guaranty. (a) Except as
otherwise provided for herein, the obligations of each Loan Guarantor hereunder
are unconditional and absolute and not subject to any reduction, limitation,
impairment or termination for any reason (other than the indefeasible payment in
full in cash of the Guaranteed Obligations), including: (i) any claim of waiver,
release, extension, renewal, settlement, surrender, alteration, or compromise of
any of the Guaranteed Obligations, by operation of law or otherwise; (ii) any
change in the corporate existence, structure or ownership of any Borrower or any
other guarantor of or other person liable for any of the Guaranteed Obligations;
(iii) any insolvency, bankruptcy, reorganization or other similar proceeding
affecting any Obligated Party, or their assets or any resulting release or
discharge of any obligation of any Obligated Party; or (iv) the existence of any
claim, setoff or other rights which any Loan Guarantor may have at any time
against any Obligated Party, the Administrative Agent, the Issuing Bank, any
Lender, or any other person, whether in connection herewith or in any unrelated
transactions.

(b) The obligations of each Loan Guarantor hereunder are not subject to any
defense or setoff, counterclaim, recoupment, or termination whatsoever by reason
of the invalidity, illegality, or unenforceability of any of the Guaranteed
Obligations or otherwise, or any provision of applicable law or regulation
purporting to prohibit payment by any Obligated Party, of the Guaranteed
Obligations or any part thereof.

(c) Further, the obligations of any Loan Guarantor hereunder are not discharged
or impaired or otherwise affected by: (i) the failure of the Administrative
Agent, the Issuing Bank or any Lender to assert any claim or demand or to
enforce any remedy with respect to all or any part of the Guaranteed
Obligations; (ii) any waiver or modification of or supplement to any provision
of any agreement relating to the Guaranteed Obligations; (iii) any release,
non-perfection, or invalidity of any indirect or direct security for the
obligations of any Borrower for all or any part of the Guaranteed Obligations or
any obligations of any other guarantor of or other person liable for any of the
Guaranteed Obligations; (iv) any action or failure to act by the Administrative
Agent, the Issuing Bank or any Lender with respect to any collateral securing
any part of the Guaranteed Obligations; or (v) any default, failure or delay,
willful or otherwise, in the payment or performance of any of the Guaranteed
Obligations, or any other circumstance, act, omission or delay that might in any
manner or to any extent vary the risk of such Loan Guarantor or that would
otherwise operate as a discharge of any Loan Guarantor as a matter of law or
equity (other than the indefeasible payment in full in cash of the Guaranteed
Obligations).

SECTION 10.04. Defenses Waived. To the fullest extent permitted by applicable
law, each Loan Guarantor hereby waives any defense based on or arising out of
any defense of any Borrower or any Loan Guarantor or the unenforceability of all
or any part of the Guaranteed Obligations from any cause, or the cessation from
any cause of the liability of any Borrower or any Loan Guarantor, other than the
indefeasible payment in full in cash of the Guaranteed Obligations. Without
limiting the generality of the foregoing, each Loan Guarantor irrevocably waives
acceptance hereof, presentment, demand, protest and, to the fullest extent
permitted by law, any notice not provided for herein, as well as any requirement
that at any time any action be taken by any person against any Obligated Party,
or any other person. The Administrative Agent may, at its election, foreclose on
any Collateral held by it by one or more judicial or nonjudicial sales, accept
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fail to act with respect to any collateral securing all or a part of the
Guaranteed Obligations, compromise or adjust any part of the Guaranteed
Obligations, make any other accommodation with any Obligated Party or exercise
any other right or remedy available to it against any Obligated Party, without
affecting or impairing in any way the liability of such Loan Guarantor under
this Loan Guaranty except to the extent the Guaranteed Obligations have been
fully and indefeasibly paid in cash. To the fullest extent permitted by
applicable law, each Loan Guarantor waives any defense arising out of any such
election even though that election may operate, pursuant to applicable law, to
impair or extinguish any right of reimbursement or subrogation or other right or
remedy of any Loan Guarantor against any Obligated Party or any security.

SECTION 10.05. Rights of Subrogation. No Loan Guarantor will assert any right,
claim or cause of action, including, without limitation, a claim of subrogation,
contribution or indemnification that it has against any Obligated Party, or any
collateral, until the Loan Parties and the Loan Guarantors have fully performed
all their obligations to the Administrative Agent, the Issuing Bank and the
Lenders.

SECTION 10.06. Reinstatement; Stay of Acceleration. If at any time any payment
of any portion of the Guaranteed Obligations is rescinded or must otherwise be
restored or returned upon the insolvency, bankruptcy, or reorganization of any
Borrower or otherwise, each Loan Guarantor’s obligations under this Loan
Guaranty with respect to that payment shall be reinstated at such time as though
the payment had not been made and whether or not the Administrative Agent, the
Issuing Bank and the Lenders are in possession of this Loan Guaranty. If
acceleration of the time for payment of any of the Guaranteed Obligations is
stayed upon the insolvency, bankruptcy or reorganization of any Borrower, all
such amounts otherwise subject to acceleration under the terms of any agreement
relating to the Guaranteed Obligations shall nonetheless be payable by the Loan
Guarantors forthwith on demand by the Lender.

SECTION 10.07. Information. Each Loan Guarantor assumes all responsibility for
being and keeping itself informed of the Borrowers’ financial condition and
assets, and of all other circumstances bearing upon the risk of nonpayment of
the Guaranteed Obligations and the nature, scope and extent of the risks that
each Loan Guarantor assumes and incurs under this Loan Guaranty, and agrees that
neither the Administrative Agent, the Issuing Bank nor any Lender shall have any
duty to advise any Loan Guarantor of information known to it regarding those
circumstances or risks.

SECTION 10.08. Termination. The Lenders may continue to make loans or extend
credit to the Borrowers based on this Loan Guaranty until five (5) days after it
receives written notice of termination from any Loan Guarantor. Notwithstanding
receipt of any such notice, each Loan Guarantor will continue to be liable to
the Lenders for any Guaranteed Obligations created, assumed or committed to
prior to the fifth day after receipt of the notice, and all subsequent renewals,
extensions, modifications and amendments with respect to, or substitutions for,
all or any part of that Guaranteed Obligations.

SECTION 10.09. Taxes. All payments of the Guaranteed Obligations will be made by
each Loan Guarantor free and clear of and without deduction for any Indemnified
Taxes or U.K. Taxes; provided that if any Loan Guarantor shall be required to
deduct any Indemnified Taxes or U.K. 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, Lender or Issuing Bank (as the case may
be) receives an amount equal to the sum it would have received had no such
deductions been made, (ii) such Loan Guarantor shall make such deductions and
(iii) such Loan Guarantor shall pay the full amount deducted to the relevant
Governmental Authority in accordance with applicable law.

 

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SECTION 10.10. Maximum Liability. The provisions of this Loan Guaranty are
severable, and in any action or proceeding involving any state corporate law, or
any state, federal or foreign bankruptcy, insolvency, reorganization or other
law affecting the rights of creditors generally, if the obligations of any Loan
Guarantor under this Loan Guaranty would otherwise be held or determined to be
avoidable, invalid or unenforceable on account of the amount of such Loan
Guarantor’s liability under this Loan Guaranty, then, notwithstanding any other
provision of this Loan Guaranty to the contrary, the amount of such liability
shall, without any further action by the Loan Guarantors or the Lenders, be
automatically limited and reduced to the highest amount that is valid and
enforceable as determined in such action or proceeding (such highest amount
determined hereunder being the relevant Loan Guarantor’s “Maximum Liability”).
This Section with respect to the Maximum Liability of each Loan Guarantor is
intended solely to preserve the rights of the Lenders to the maximum extent not
subject to avoidance under applicable law, and no Loan Guarantor nor any other
person or entity shall have any right or claim under this Section with respect
to such Maximum Liability, except to the extent necessary so that the
obligations of any Loan Guarantor hereunder shall not be rendered voidable under
applicable law. Each Loan Guarantor agrees that the Guaranteed Obligations may
at any time and from time to time exceed the Maximum Liability of each Loan
Guarantor without impairing this Loan Guaranty or affecting the rights and
remedies of the Lenders hereunder; provided that, nothing in this sentence shall
be construed to increase any Loan Guarantor’s obligations hereunder beyond its
Maximum Liability.

SECTION 10.11. Contribution. In the event any Loan Guarantor (a “Paying
Guarantor”) shall make any payment or payments under this Loan Guaranty or shall
suffer any loss as a result of any realization upon any collateral granted by it
to secure its obligations under this Loan Guaranty, each other Loan Guarantor
(each a “Non-Paying Guarantor”) shall contribute to such Paying Guarantor an
amount equal to such Non-Paying Guarantor’s “Applicable Percentage” of such
payment or payments made, or losses suffered, by such Paying Guarantor. For
purposes of this Article X, each Non-Paying Guarantor’s “Applicable Percentage”
with respect to any such payment or loss by a Paying Guarantor shall be
determined as of the date on which such payment or loss was made by reference to
the ratio of (i) such Non-Paying Guarantor’s Maximum Liability as of such date
(without giving effect to any right to receive, or obligation to make, any
contribution hereunder) or, if such Non-Paying Guarantor’s Maximum Liability has
not been determined, the aggregate amount of all monies received by such
Non-Paying Guarantor from the Borrowers after the date hereof (whether by loan,
capital infusion or by other means) to (ii) the aggregate Maximum Liability of
all Loan Guarantors hereunder (including such Paying Guarantor) as of such date
(without giving effect to any right to receive, or obligation to make, any
contribution hereunder), or to the extent that a Maximum Liability has not been
determined for any Loan Guarantor, the aggregate amount of all monies received
by such Loan Guarantors from the Borrowers after the date hereof (whether by
loan, capital infusion or by other means). Nothing in this provision shall
affect any Loan Guarantor’s several liability for the entire amount of the
Guaranteed Obligations (up to such Loan Guarantor’s Maximum Liability). Each of
the Loan Guarantors covenants and agrees that its right to receive any
contribution under this Loan Guaranty from a Non-Paying Guarantor shall be
subordinate and junior in right of payment to the payment in full in cash of the
Guaranteed Obligations. This provision is for the benefit of both the
Administrative Agent, the Issuing Bank, the Lenders and the Loan Guarantors and
may be enforced by any one, or more, or all of them in accordance with the terms
hereof.

SECTION 10.12. Liability Cumulative. The liability of each Loan Party as a Loan
Guarantor under this Article X is in addition to and shall be cumulative with
all liabilities of each Loan Party to the Administrative Agent, the Issuing Bank
and the Lenders under this Agreement and the other Loan Documents to which such
Loan Party is a party or in respect of any obligations or liabilities of the
other Loan Parties, without any limitation as to amount, unless the instrument
or agreement evidencing or creating such other liability specifically provides
to the contrary.

 

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SECTION 10.13. Affected Foreign Subsidiaries. Notwithstanding anything in this
Agreement (including without limitation, this Article X) to the contrary, (i) no
Foreign Subsidiary shall be a primary obligor or guarantor (pursuant to
Section 10.01 or otherwise) or pledgor of any assets or otherwise be responsible
for, in each case, any Obligations incurred by or on behalf of any Domestic Loan
Party in any manner that would cause a Deemed Dividend Issue and (ii) no Foreign
Subsidiary which is and remains an Affected Foreign Subsidiary shall be liable
hereunder for any of the Loans made to, or any other Obligations incurred by or
on behalf of, any Domestic Loan Party.

ARTICLE XI

The Borrower Representative.

SECTION 11.01. Appointment; Nature of Relationship. The Company is hereby
appointed by each of the Borrowers as its contractual representative (herein
referred to as the “Borrower Representative”) hereunder and under each other
Loan Document, and each of the Borrowers irrevocably authorizes the Borrower
Representative to act as the contractual representative of such Borrower with
the rights and duties expressly set forth herein and in the other Loan
Documents. The Borrower Representative agrees to act as such contractual
representative upon the express conditions contained in this Article XI.
Additionally, the Borrowers hereby appoint the Borrower Representative as their
agent to receive all of the proceeds of the Loans in the Funding Account(s), at
which time the Borrower Representative shall promptly disburse such Loans to the
appropriate Borrower(s). The Administrative Agent and the Lenders, and their
respective officers, directors, agents or employees, shall not be liable to the
Borrower Representative or any Borrower for any action taken or omitted to be
taken by the Borrower Representative or the Borrowers pursuant to this
Section 11.01.

SECTION 11.02. Powers. The Borrower Representative shall have and may exercise
such powers under the Loan Documents as are specifically delegated to the
Borrower Representative by the terms of each thereof, together with such powers
as are reasonably incidental thereto. The Borrower Representative shall have no
implied duties to the Borrowers, or any obligation to the Lenders to take any
action thereunder except any action specifically provided by the Loan Documents
to be taken by the Borrower Representative.

SECTION 11.03. Employment of Agents. The Borrower Representative may execute any
of its duties as the Borrower Representative hereunder and under any other Loan
Document by or through authorized officers.

SECTION 11.04. Notices. Each Borrower shall immediately notify the Borrower
Representative of the occurrence of any Default or Unmatured Default hereunder
referring to this Agreement describing such Default or Unmatured Default and
stating that such notice is a “notice of default”. In the event that the
Borrower Representative receives such a notice, the Borrower Representative
shall give prompt notice thereof to the Administrative Agent and the Lenders.
Any notice provided to the Borrower Representative hereunder shall constitute
notice to each Borrower on the date received by the Borrower Representative.

SECTION 11.05. Successor Borrower Representative. Upon the prior written consent
of the Administrative Agent, the Borrower Representative may resign at any time,
such resignation to be effective upon the appointment of a successor Borrower
Representative. The Administrative Agent shall give prompt written notice of
such resignation to the Lenders.

 

117

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SECTION 11.06. Execution of Loan Documents; Borrowing Base Certificate. The
Borrowers hereby empower and authorize the Borrower Representative, on behalf of
the Borrowers, to execute and deliver to the Administrative Agent and the
Lenders the Loan Documents and all related agreements, certificates, documents,
or instruments as shall be necessary or appropriate to effect the purposes of
the Loan Documents, including, without limitation, the Borrowing Base
Certificates and the Compliance Certificates. Each Borrower agrees that any
action taken by the Borrower Representative or the Borrowers in accordance with
the terms of this Agreement or the other Loan Documents, and the exercise by the
Borrower Representative of its powers set forth therein or herein, together with
such other powers that are reasonably incidental thereto, shall be binding upon
all of the Borrowers.

SECTION 11.07. Reporting. Each Borrower hereby agrees that such Borrower shall
furnish promptly after each fiscal month to the Borrower Representative a copy
of its Borrowing Base Certificate and any other certificate or report required
hereunder or requested by the Borrower Representative on which the Borrower
Representative shall rely to prepare the Borrowing Base Certificates and
Compliance Certificate required pursuant to the provisions of this Agreement.

ARTICLE XII

Collection Allocation Mechanism

(a) On the CAM Exchange Date, (i) the Commitments shall automatically and
without further act be terminated as provided in Article VII, (ii) the principal
amount of each Revolving Loan and LC Disbursement denominated in a Foreign
Currency shall automatically and without any further action required, be
converted into Dollars determined using the Exchange Rates calculated as of the
CAM Exchange Date, equal to the Dollar Amount of such amount and on and after
such date all amounts accruing and owed to any Revolving Lender in respect of
such Obligations shall accrue and be payable in Dollars at the rates otherwise
applicable hereunder and (iii) the Lenders shall automatically and without
further act be deemed to have made reciprocal purchases of interests in the
Designated Obligations such that, in lieu of the interests of each Revolving
Lender in the particular Designated Obligations that it shall own as of such
date and immediately prior to the CAM Exchange, such Revolving Lender shall own
an interest equal to such Revolving Lender’s CAM Percentage in each Designated
Obligation. Each Revolving Lender, each Person acquiring a participation from
any Revolving Lender as contemplated by Section 9.04, and the Borrowers hereby
consent and agree to the CAM Exchange. The Borrowers and the Lenders agree from
time to time to execute and deliver to the Administrative Agent all such
promissory notes and other instruments and documents as the Administrative Agent
shall reasonably request to evidence and confirm the respective interests and
obligations of the Lenders after giving effect to the CAM Exchange, and each
Revolving Lender agrees to surrender any promissory notes originally received by
it hereunder to the Administrative Agent against delivery of any promissory
notes so executed and delivered; provided that, the failure of any Borrower to
execute or deliver or of any Revolving Lender to accept any such promissory
note, instrument or document shall not affect the validity or effectiveness of
the CAM Exchange.

(b) As a result of the CAM Exchange, on and after the CAM Exchange Date, each
payment received by the Administrative Agent pursuant to any Loan Document in
respect of the Designated Obligations shall be distributed to the Lenders pro
rata in accordance with their respective CAM Percentages (to be redetermined as
of each such date of payment or distribution to the extent required by paragraph
(c) below).

(c) In the event that, after the CAM Exchange, the aggregate amount of the
Designated Obligations shall change as a result of the making of an LC
Disbursement by the Issuing Bank that is not reimbursed by any Borrower, then
(i) each Revolving Lender shall, in accordance with Section 2.06(e), promptly
purchase from the Issuing Bank the Dollar equivalent of a participation in such
LC Disbursement in the amount of such Revolving Lender’s Applicable Percentage
of such LC Disbursement

 

118

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(without giving effect to the CAM Exchange), (ii) the Administrative Agent shall
redetermine the CAM Percentages after giving effect to such LC Disbursement and
the purchase of participations therein by the applicable Lenders, and the
Lenders shall automatically and without further act be deemed to have made
reciprocal purchases of interests in the Designated Obligations such that each
Revolving Lender shall own an interest equal to such Revolving Lender’s CAM
Percentage in each of the Designated Obligations and (iii) in the event
distributions shall have been made in accordance with clause (i) of paragraph
(b) above, the Lenders shall make such payments to one another in Dollars as
shall be necessary in order that the amounts received by them shall be equal to
the amounts they would have received had each LC Disbursement been outstanding
immediately prior to the CAM Exchange. Each such redetermination shall be
binding on each of the Lenders and their successors and assigns in respect of
the Designated Obligations held by such Persons and shall be conclusive absent
manifest error.

(d) Nothing in this Article shall prohibit the assignment by any Revolving
Lender of interests in some but not all of the Designated Obligations held by it
after giving effect to the CAM Exchange; provided that, in connection with any
such assignment such Revolving Lender and its assignee shall enter into an
agreement setting forth their reciprocal rights and obligations in the event of
a redetermination of the CAM Percentages as provided in the immediately
preceding paragraph (c).

[Signature Pages Follow]

 

119

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LOGO [g608281p125.jpg]

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LOGO [g608281p126.jpg]

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LOGO [g608281p127.jpg]

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LOGO [g608281p128.jpg]

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LOGO [g608281p129.jpg]

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SCHEDULE 2.01

COMMITMENTS

 

Lender

   Dollar Tranche
Commitment      Multicurrency
Tranche
Commitment      Total
Commitment     

Treaty Passport Scheme Reference

Number and Jurisdiction of Tax

Residence (if applicable)

JPMorgan Chase Bank, N.A.

   $ 45,000,000       $ 9,000,000       $ 54,000,000      

13/M/0268710/DTTP

(United States)

HSBC Bank USA, National Association (successor by merger to HSBC Business Credit
(USA) Inc.)

   $ 35,000,000       $ 7,000,000       $ 42,000,000      

Capital One Leverage Finance Corp.

   $ 30,000,000       $ 0       $ 30,000,000      

Sovereign Bank

   $ 20,000,000       $ 4,000,000       $ 24,000,000      

TOTAL

   $ 130,000,000       $ 20,000,000       $ 150,000,000      

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SCHEDULE 2.02

MANDATORY COST

 

1. The Mandatory Cost is an addition to the interest rate to compensate Lenders
for the cost of compliance with (a) the requirements of the Bank of England
and/or the Financial Services Authority (or, in either case, any other authority
which replaces all or any of its functions) or (b) the requirements of the
European Central Bank.

 

2. On the first day of each Interest Period (or as soon as possible thereafter)
the Administrative Agent shall calculate, as a percentage rate, a rate (the
“Associated Costs Rate”) for each Lender, in accordance with the paragraphs set
out below. The Mandatory Cost will be calculated by the Administrative Agent as
a weighted average of the Lenders’ Associated Costs Rates (weighted in
proportion to the percentage participation of each Lender in the relevant Loan)
and will be expressed as a percentage rate per annum.

 

3. The Associated Costs Rate for any Lender lending from a Facility Office in a
Participating Member State will be the percentage notified by that Lender to the
Administrative Agent. This percentage will be certified by that Lender in its
notice to the Administrative Agent to be its reasonable determination of the
cost (expressed as a percentage of that Lender’s participation in all Loans made
from that Facility Office) of complying with the minimum reserve requirements of
the European Central Bank in respect of loans made from that Facility Office.

 

4. The Associated Costs Rate for any Lender lending from a Facility Office in
the United Kingdom will be calculated by the Administrative Agent as follows:

 

  (a) in relation to a Loan in Pounds Sterling:

 

LOGO [g60828131a.jpg]

 

  (b) in relation to a Loan in any currency other than Pounds Sterling:

 

LOGO [g60828131b.jpg]

 

   Where:

 

  A is the percentage of Eligible Liabilities (assuming these to be in excess of
any stated minimum) which that Lender is from time to time required to maintain
as an interest free cash ratio deposit with the Bank of England to comply with
cash ratio requirements.

 

  B is the percentage rate of interest (excluding the Applicable Rate and the
Mandatory Cost and, if the Loan is an Unpaid Sum, the additional rate of
interest specified in Section 2.13(c)) payable for the relevant Interest Period
on the Loan.

 

  C is the percentage (if any) of Eligible Liabilities which that Lender is
required from time to time to maintain as interest bearing Special Deposits with
the Bank of England.

 

  D is the percentage rate per annum payable by the Bank of England to the
Administrative Agent on interest bearing Special Deposits.

 

  E is designed to compensate Lenders for amounts payable under the Fees Rules
and is calculated by the Administrative Agent as being the average of the most
recent rates of charge supplied by the Reference Banks to the Administrative
Agent pursuant to paragraph 7 below and expressed in Pounds Sterling per
£1,000,000.

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5. For the purposes of this Schedule:

 

  (a) “Eligible Liabilities” and “Special Deposits” have the meanings given to
them from time to time under or pursuant to the Bank of England Act 1998 or (as
may be appropriate) by the Bank of England;

 

  (b) “Facility Office” means the office or offices notified by a Lender to the
Administrative Agent in writing on or before the date it becomes a Lender (or,
following that date, by not less than five Business Days’ written notice) as the
office or offices through which it will perform its obligations under this
Agreement.

 

  (c) “Fees Rules” means the rules on periodic fees contained in the Financial
Services Authority Fees Manual or such other law or regulation as may be in
force from time to time in respect of the payment of fees for the acceptance of
deposits;

 

  (d) “Fee Tariffs” means the fee tariffs specified in the Fees Rules under the
activity group A.1 Deposit acceptors (ignoring any minimum fee or zero rated fee
required pursuant to the Fees Rules but taking into account any applicable
discount rate);

 

  (e) [Intentionally omitted].

 

  (f) “Reference Banks” means, in relation to Mandatory Cost, the principal
London office of JPMorgan Chase Bank, N.A.

 

  (g) “Tariff Base” has the meaning given to it in, and will be calculated in
accordance with, the Fees Rules.

 

  (h) “Unpaid Sum” means any sum due and payable but unpaid by any Borrower
under the Loan Documents.

 

6. In application of the above formulae, A, B, C and D will be included in the
formulae as percentages (i.e. 5 per cent. will be included in the formula as 5
and not as 0.05). A negative result obtained by subtracting D from B shall be
taken as zero. The resulting figures shall be rounded to four decimal places.

 

7. If requested by the Administrative Agent, each Reference Bank shall, as soon
as practicable after publication by the Financial Services Authority, supply to
the Administrative Agent, the rate of charge payable by that Reference Bank to
the Financial Services Authority pursuant to the Fees Rules in respect of the
relevant financial year of the Financial Services Authority (calculated for this
purpose by that Reference Bank as being the average of the Fee Tariffs
applicable to that Reference Bank for that financial year) and expressed in
Pounds Sterling per £1,000,000 of the Tariff Base of that Reference Bank.

 

8. Each Lender shall supply any information required by the Administrative Agent
for the purpose of calculating its Associated Costs Rate. In particular, but
without limitation, each Lender shall supply the following information on or
prior to the date on which it becomes a Lender:

 

  (a) the jurisdiction of its Facility Office; and

 

2

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  (b) any other information that the Administrative Agent may reasonably require
for such purpose.

Each Lender shall promptly notify the Administrative Agent of any change to the
information provided by it pursuant to this paragraph.

 

9. The percentages of each Lender for the purpose of A and C above and the rates
of charge of each Reference Bank for the purpose of E above shall be determined
by the Administrative Agent based upon the information supplied to it pursuant
to paragraphs 7 and 8 above and on the assumption that, unless a Lender notifies
the Administrative Agent to the contrary, each Lender’s obligations in relation
to cash ratio deposits and Special Deposits are the same as those of a typical
bank from its jurisdiction of incorporation with a Facility Office in the same
jurisdiction as its Facility Office.

 

10. The Administrative Agent shall have no liability to any person if such
determination results in an Associated Costs Rate which over or under
compensates any Lender and shall be entitled to assume that the information
provided by any Lender or Reference Bank pursuant to paragraphs 3, 7 and 8 above
is true and correct in all respects.

 

11. The Administrative Agent shall distribute the additional amounts received as
a result of the Mandatory Cost to the Lenders on the basis of the Associated
Costs Rate for each Lender based on the information provided by each Lender and
each Reference Bank pursuant to paragraphs 3, 7 and 8 above.

 

12. Any determination by the Administrative Agent pursuant to this Schedule in
relation to a formula, the Mandatory Cost, an Associated Costs Rate or any
amount payable to a Lender shall, in the absence of manifest error, be
conclusive and binding on all parties hereto.

 

13. The Administrative Agent may from time to time, after consultation with the
Borrower Representative and the relevant Lenders, determine and notify to all
parties hereto any amendments which are required to be made to this Schedule
2.02 in order to comply with any change in law, regulation or any requirements
from time to time imposed by the Bank of England, the Financial Services
Authority or the European Central Bank (or, in any case, any other authority
which replaces all or any of its functions) and any such determination shall, in
the absence of manifest error, be conclusive and binding on all parties hereto.

 

3

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Schedule 2.07

Existing Letters of Credit

 

Beneficiary

  

Issuing Bank

  

Purpose

   Amount     

Other Information

Matrix 7A Land Venture    HSBC Bank USA, National Association    Security for
Robbinsville, NJ Lease    $ 381,881.06       Standing letter of credit, with
evergreen provision, until final expiry date of January 18, 2016. Blake Street
LLC    HSBC Bank USA, National Association    Security for Medford, MA Lease   
$ 250,000.00       Standing letter of credit, with evergreen provision until
final expiry date of January 1, 2012. NY Life Insurance Company    HSBC Bank
USA, National Association    Security for Mikasa NY Showroom Lease    $
540,000.00       Standing letter of credit, with evergreen provision, until
final expiry date of October 31, 2021. Great American Insurance Company    JP
Morgan Chase Bank, N.A.    Per Deductible Security Agreement for Workers
Compensation Insurance Program    $ 240,000.00       Expiration is 12/22/11,
with automatic 12 month extension unless notified by bank 30 days prior of
non-extension

Total Standby LC’s

         $ 1,411,881.06      

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

Schedule 3.05

Properties

 

Loan Party

  

Locations

  

Owned/

Leased

Lifetime Brands, Inc.   

1000 Stewart Avenue

Garden City, NY 11530

(Corporate headquarters/main showroom)

   Leased Lifetime Brands, Inc.   

10825 Production Avenue

Fontana, CA 92337

(Principal West Coast warehouse and distribution facility)

   Leased Lifetime Brands, Inc.   

10725 Sierra Avenue, Unit B

Fontana, CA 92337

(Warehouse and distribution facility – month to month)

   Leased Lifetime Brands, Inc.   

22 Blake Street

Medford, MA 02155

(Offices, showroom, warehouse and distribution facility)

   Leased Lifetime Brands, Inc.   

362-363 River Street

Winchendon, MA 01475

(Warehouse and distribution facility, and spice packing line)

   Owned Lifetime Brands, Inc.   

12 Applegate Drive

Robbinsville, NJ 08691

(Principal East Coast warehouse and distribution facility)

   Leased Lifetime Brands, Inc.   

303 South Broadway, Suite #470

Tarrytown, New York 10591

(Office – Kamenstein division)

   Leased Lifetime Brands, Inc.   

3501 Concord Road

York, PA 17402

(Office – Direct to consumer division)

   Leased Lifetime Brands, Inc.   

802 SE Plaza Avenue, Suite 106

Bentonville, Arkansas

(Regional sales office)

   Leased Lifetime Brands, Inc.   

W134 N5526 Campell Drive, Suite 5510, Menomonee Falls, Wisconsin

(Regional sales office)

   Leased Lifetime Brands, Inc.   

41 Madison Avenue

Portion of the 10th Floor

New York, New York

(Office / Showroom)

   Leased Lifetime Brands, Inc.   

200 W. Jackson Boulevard, Suite 1300

Chicago, Illinois

(Former regional office, currently subleased to third party –expires on November
29, 2011)

   Leased

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

Loan Party

  

Locations

  

Owned/

Leased

TMC Acquisition Inc.   

51 Madison Avenue

Portions of Ground and Mezzanine

New York, New York

(Showroom)

   Leased Lifetime Brands, Inc.   

Atlanta Gift Mart / Rms. 916A, B

Atlanta, Georgia

(Showroom)

   Leased Lifetime Brands, Inc.   

Atlanta Gift Mart

Rms. 1518, 1522, 1528, 1530

Atlanta, Georgia

(Showroom)

   Leased Wallace Silversmiths de Puerto Rico, Ltd.   

B Street

Barrio Retiro Industrial

San German, PR 00683

(Sterling silver manufacturing facility)

   Leased

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

Schedule 3.06

Disclosed Matters

 

1. Notice of Potential Liability and Request for Information regarding the San
German Ground Water Contamination Superfund Site, San German Puerto Rico

Wallace Silversmiths de Puerto Rico, Ltd. (“Wallace de Puerto Rico”), a
wholly-owned subsidiary of the Company, operates a manufacturing facility in San
Germán, Puerto Rico, that is leased from the Puerto Rico Industrial Development
Company (“PRIDCO”). In March 2008, the United States Environmental Protection
Agency (the “EPA”) announced that the San Germán Ground Water Contamination site
in Puerto Rico (the “Site”) had been added to the Superfund National Priorities
List due to contamination present in the local drinking water supply.

In May 2008, Wallace de Puerto Rico received from the EPA a Notice of Potential
Liability and Request for Information Pursuant to 42 U.S.C. Sections 9607(a) and
9604(e) of the Comprehensive Environmental Response, Compensation, Liability
Act. The Company responded to the EPA’s Request for Information on behalf of
Wallace. In July, 2011, Wallace de Puerto Rico received a letter from the EPA
requesting access to the property that it leases from PRIDCO and the Company
granted such access.

The Company is not aware of any determination by the EPA that any remedial
action is warranted for the Site; and, accordingly, is not able to estimate the
extent of any possible liability.

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Schedule 3.14

Insurance

 

LIFETIME BRANDS, INC.- SCHEDULE OF INSURANCE

Line of Insurance

  

Limits /Deductible

   Policy Period   

Carrier (Specific)

   Policy Number Directors and Officers       3/31/11-
3/31/12    Illinois National Insurance Company    016401328 Excess Directors and
Officers       3/31/11-
3/31/12    Allied World Assurance Company (U.S.), Inc.    03054410 Excess
Directors and Officers       3/31/11-
3/31/12    Federal Insurance Company    68047967 Employee Benefit Plan Fiduciary
Liability Insurance (Fiduciary)       3/31/11-
3/31/12    Illinois National Insurance Company    013741879 Executive
Risk—Primary (Special Crime)       3/31/11-
3/31/14    U.S. Specialty Insurance Co    U71185268 Commercial Crime      
3/31/11-
3/31/12    Berkley Regional Insurance Company—A Berkley Company    BCR7100051211
Commercial Property       11/19/2010-
11/19/2011    Affiliated FM Insurance Co.    KJ048

General Liability

      11/19/2010-
11/19/2011    Hartford Fire Insurance Company    10UENIT4257DB

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Commercial Automobile All States Except MA      11/19/2010-
11/19/2011    Hartford Casuality Insurance Co.    10UENKK4018DB Commercial
Automobile MA Autos      11/19/2010-
11/19/2011    Twin City Fire Insurance Co.    10MCP700080 Workers Compensation  
   11/19/2010-
11/19/2011    Great American Alliance    WC170876600 & WC170876700 Umbrella
Liability      11/19/2010-
11/19/2011    Continental Casualty Insurance Co.    L2084504683 XS Umbrella
Liability      11/19/2010-
11/19/2011    Federal Insurance Company    93636136 Foreign Package     
11/19/2010-
11/19/2011    The Ins Co of the State of PA    WS11001643

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Ocean Marine      11/19/2010-
11/19/2011    Starr Indemnity & Liability Co    MASICNY0073US09 Ocean Marine DIC
     1/18/2011-
11/19/2011    Alterra Excess & Surplus Ins Co    MAX2XP0051110 Ocean Marine DIC
     1/18/2011-
11/19/2011    AXIS Surplus Ins Co and Underwriters at Lloyd’s    AXS101290 and
LLO00025 Package (Puerto Rico)      11/19/2010-
11/19/2011    Real Legacy Assurance Co.    CPP2012003989 Commercial Automobile
(Puerto Rico)      11/19/2010-
11/19/2011    Real Legacy Assurance Co.    CLP2012004243

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Flood      4/16/2011-
4/16/2012    Selective Insurance Company of NY    FDL1015084 Flood     
4/16/2011-
4/16/2012    Selective Insurance Company of NY    FDL1015085 Bond      1/5/2011-
1/5/2012    Washington International Ins. Co.    1693321 Bond      6/29/2011 –
6/29/2012    Travelers Casualty and Surety Co.    9911S4820

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Schedule 3.15

Capitalization and Subsidiaries

 

Lifetime Brands, Inc.

(Delaware corporation)

     Authorized Shares:    100 shares of Series A Preferred Stock par value of
$1.00, 2,000,000 shares Series B Preferred Stock par value of $1.00 and
25,000,000 shares of common stock par value $.01 per share    12,092,943 shares
of common stock issued and outstanding at September 30, 2011 (publicly held)

TMC Acquisition Inc.

(Delaware corporation)

Authorized Shares:    1,000 shares of common stock, par value $.01 per share 100
shares issued to and held by Lifetime Brands, Inc.

Pfaltzgraff Factory Stores, Inc.

(Delaware corporation)

Authorized Shares:    1,000 shares of common stock, par value $.01 per share 100
shares issued to and held by Lifetime Brands, Inc.

Lifetime Delaware Holdings, LLC

(Delaware Limited Liability Company)

Authorized Units:    1,000 units issued to and held by Lifetime Brands, Inc.

Wallace Silversmiths de Puerto Rico LTD

(Cayman Islands corporation)

Authorized Shares:    5,000,000 shares of common stock, par value $.01 per share
1,000 shares issued to and held by Lifetime Brands

LTB DE Mexico, S.A. DE C.V.

(United States of Mexico corporation)

Authorized Shares:    50,000 shares of common stock, par value 1.00 peso per
share 49,999 shares issued to and held by Lifetime Brands, Inc. 1 share issued
to and held by James Gary Siegel

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Lifetime Brands, Inc. (HK) Limited

(Hong Kong corporation)

Authorized Shares:   

10,000 ordinary shares

1 share issued to and held by Lifetime Brands, Inc.

1 share issued to and held by James Gary Siegel

New Goal Development Limited

(Hong Kong corporation)

Authorized Shares:   

10,000 ordinary shares

1 share issued to and held by Lifetime Brands, Inc.

Lifetime Brands Global Sourcing (Shanghai) Consultancy Limited

(Incorporated in Shanghai, the PRC)

Authorized Capital:   

US$150,000

All shares held by Lifetime Brands, Inc.

Grand Venture Enterprises Limited

(Hong Kong corporation)

Authorized Shares:   

10,000 ordinary shares

1 share issued to and held by New Goal Development Limited, a subsidiary of
Lifetime Brands, Inc.

Lifetime Brands UK Limited

(A company incorporated and registered in England and Wales)

Authorized Shares:   

100 ordinary shares £1 per share

100 shares issued to and held by Lifetime Delaware Holdings, LLC, a subsidiary
of Lifetime Brands, Inc.

Lifetime Brands Holdings Limited

(A company incorporated and registered in England and Wales)

Authorized Shares:   

100 ordinary shares £1 per share

1share issued to and held by Lifetime UK Limited, a subsidiary of Lifetime
Delaware Holdings, LLC.

LVA Limited

(Hong Kong corporation)

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

Authorized Shares:   

10,000 ordinary shares

80 shares issued to and held by New Goal Development Limited, a subsidiary of
Lifetime Brands, Inc.

10 shares issued to and held by Grupo Vasconia, S.A.B.

10 shares issued to and held by Accent-Fairchild Group Inc.

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

Schedule 6.01

Existing Indebtedness

Description

 

1. Capitalized equipment leases:

 

     Amount outstanding
September 30, 2011  

Crown Credit Company

     7,180   

Raymond Leasing Corp.

     2,159   

Total

   $ 9,339   

 

2. Swap obligations: NONE

 

3. Insurance premium finance arrangements: NONE

 

4. Guarantees of Indebtedness:

None other than Guarantees by Lifetime Brands, Inc. of real property leases and
other similar obligations of the Borrower’s operating subsidiaries.

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

Schedule 6.02

Existing Liens and Security Interests

[Note that this schedule does not include liens securing obligations under the

Existing Credit Agreement.]

 

Debtor

  

Secured Party

  

Collateral

Lifetime Brands, Inc.    Marlin Leasing Corp.    Office equipment, two Xerox
Docucolor copiers, Xerox photocopiers. Lifetime Brands, Inc.    Marlin Business
Bank    Office equipment, Xerox Docucolor copiers. Lifetime Brands, Inc.    US
Express Leasing, Inc.    Office equipment, such as photocopiers. Lifetime
Brands, Inc.    Canon Financial Services    Specific equipment, such as graphics
equipment. Lifetime Brands, Inc.    Ricoh Americas Corp.    Office equipment,
such as photocopiers. Lifetime Brands, Inc.    Canon Business Solutions   
Specific equipment. Lifetime Brands, Inc.    Raymond Leasing Corp.    Office
equipment, such as photocopiers. Lifetime Brands, Inc.    Crown Credit Company
   Lift trucks, forklifts, and other warehouse equipment. Lifetime Brands, Inc.
   Raymond Leasing Corp.    Forklifts and other warehouse equipment. Lifetime
Brands, Inc.    CIT Technology Finance Service    Specific equipment such as
Plotter Printer. Lifetime Brands, Inc.    De Lage Landen Financial Services   
Office equipment, such as photocopiers. Lifetime Brands, Inc.    Hilo Yale
Industrial Trucks, Inc.    Scissor Lift. Lifetime Brands, Inc.    Ikon Financial
Services    Office equipment, such as photocopiers. Lifetime Brands, Inc.   
Interstate Trailer Sales, Inc.    Warehouse equipment. Lifetime Brands, Inc.   
Lease Line, Inc.    Warehouse equipment. Lifetime Brands, Inc.    Mailfinance   
Office equipment, such as photocopiers. Lifetime Brands, Inc.    Pitney Bowes,
Inc.    Office equipment, such as postage meter machine. Lifetime Brands, Inc.
   Premier Trailer Leasing, Inc.    Warehouse equipment. Lifetime Brands, Inc.
   Quality Copy Products    Office equipment, such as photocopiers. Lifetime
Brands, Inc.    Raymond Handling Solutions, Inc.    Warehouse equipment.
Lifetime Brands, Inc.    Reliable Office Systems & Supplies    Office equipment,
such as photocopiers. Lifetime Brands, Inc.    Arbor Material Handling, Inc.   
Warehouse equipment. Lifetime Brands, Inc.    Xerox Corp.    Office equipment,
such as photocopiers. Lifetime Brands, Inc.    Southwest Material Handling, Inc.
   Warehouse equipment such as forklift and cascade push pull.

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

Schedule 6.04

Existing Investments

 

1. In addition to Borrower’s investments in its own Subsidiaries, Borrower’s
subsidiary, LTB de MEXICO, S.A. de C.V., holds a 30% equity interest in Grupo
Vasconia, S.A.B.

 

2. In addition to Borrower’s investments in its own Subsidiaries, Borrower’s
subsidiary, New Goal Development Limited (a Hong Kong entity), holds a 50%
equity interest in World Alliance Enterprises Limited (a Hong Kong entity) and
an 80% equity interest in LVA Limited (a Hong Kong entity). LVA Limited holds a
50% equity interest in Housewares Corporation of Asia Limited (a Hong Kong
entity).

 

3. Purchase price installment note payable to Borrower pursuant to Asset
Purchase Agreement dated as of December 15, 2008, among Lifetime Brands, Inc.,
as Seller, Use Bath Fixtures, L.L.C., as Purchaser, and Michael J. Velsmid, Jr.,
outstanding balance of $241,262.49 at September 30, 2011.

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

Schedule 6.10

Existing Restrictive Agreements

Shareholders’ Agreement by and among New Goal Development Limited and Grupo
Vasconia, S.A.B. and Accent-Fairchild Group Inc. (as “Shareholders”) provides
that except upon prior approval of all of the other Shareholders to or as
specified in Clause 6.2, no Shareholder may sell, transfer, assign, charge or
create any security interest or encumbrance over, or otherwise dispose of, the
beneficial interest over all or any part of the Shares beneficially owned by it;
provided that the foregoing restrictions shall not apply (i) to any sale,
transfer or disposition of all or any part of the Shares to an Affiliate or
(ii) to any charge, security interest or encumbrance incurred in connection with
a bank credit or other financing arrangement entered into in the ordinary course
of business. Clause 6.2 of Shareholders’ Agreement states that in the event
either of New Goal, Vasconia or AFG proposes to transfer all or part of its
Shares to one of its Affiliates, it can do so provided that (i) the transferee
agrees in writing to be bound by the terms and conditions of this Agreement and
(ii) the transferor shall remain liable for any breaches of this Agreement by
the transferee.

EXHIBIT A

ASSIGNMENT AND ASSUMPTION

This Assignment and Assumption (the “Assignment and Assumption”) is dated as of
the Effective Date set forth below and is entered into by and between [Insert
name of Assignor] (the “Assignor”) and [Insert name of Assignee] (the
“Assignee”). Capitalized terms used but not defined herein shall have the
meanings given to them in the Credit Agreement identified below (as amended, the
“Credit Agreement”), receipt of a copy of which is hereby acknowledged by the
Assignee. The Standard Terms and Conditions set forth in Annex 1 attached hereto
are hereby agreed to and incorporated herein by reference and made a part of
this Assignment and Assumption as if set forth herein in full.

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

For an agreed consideration, the Assignor hereby irrevocably sells and assigns
to the Assignee, and the Assignee hereby irrevocably purchases and assumes from
the Assignor, subject to and in accordance with the Standard Terms and
Conditions and the Credit Agreement, as of the Effective Date inserted by the
Administrative Agent as contemplated below (i) all of the Assignor’s rights and
obligations in its capacity as a Lender under the Credit Agreement and any other
documents or instruments delivered pursuant thereto to the extent related to the
amount and percentage interest identified below of all of such outstanding
rights and obligations of the Assignor under the respective facilities
identified below (including any letters of credit, guarantees, and swingline
loans included in such facilities) and (ii) to the extent permitted to be
assigned under applicable law, all claims, suits, causes of action and any other
right of the Assignor (in its capacity as a Lender) against any Person, whether
known or unknown, arising under or in connection with the Credit Agreement, any
other documents or instruments delivered pursuant thereto or the loan
transactions governed thereby or in any way based on or related to any of the
foregoing, including contract claims, tort claims, malpractice claims, statutory
claims and all other claims at law or in equity related to the rights and
obligations sold and assigned pursuant to clause (i) above (the rights and
obligations sold and assigned pursuant to clauses (i) and (ii) above being
referred to herein collectively as the “Assigned Interest”). Such sale and
assignment is without recourse to the Assignor and, except as expressly provided
in this Assignment and Assumption, without representation or warranty by the
Assignor.

 

1.    Assignor:     2.    Assignee:          [and is an Affiliate/Approved Fund
of [identify Lender]1] 3.    Borrowers:   Lifetime Brands, Inc. and certain
Foreign Subsidiary Borrowers 4.    Administrative Agent:   JPMorgan Chase Bank,
N.A., as the administrative agent under the Credit Agreement 5.    Credit
Agreement:   Amended and Restated Credit Agreement dated as of October 28, 2011
among Lifetime Brands, Inc., the Foreign Subsidiary Borrowers from time to time
party thereto, the other Loan Parties parties thereto, the Lenders parties
thereto and JPMorgan Chase Bank, N.A., as Administrative Agent

 

1  Select as applicable.

Exhibit A

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6. Assigned Interest:

 

Facility Assigned2

   Aggregate Amount of
Commitment/Loans for
all Lenders      Amount of
Commitment/Loans
Assigned      Percentage Assigned of
Commitment/Loans3      $         $           %       $         $           %   
   $         $           %   

Effective Date:             , 20        [TO BE INSERTED BY ADMINISTRATIVE AGENT
AND WHICH SHALL BE THE EFFECTIVE DATE OF RECORDATION OF TRANSFER IN THE REGISTER
THEREFOR.]

The Assignee agrees to deliver to the Administrative Agent a completed
Administrative Questionnaire in which the Assignee designates one or more Credit
Contacts to whom all syndicate-level information (which may contain material
non-public information about the Borrowers, the Loan Parties and their Related
Parties or their respective securities) will be made available and who may
receive such information in accordance with the Assignee’s compliance procedures
and applicable laws, including Federal and state securities laws.

The terms set forth in this Assignment and Assumption are hereby agreed to:

 

ASSIGNOR

 

[NAME OF ASSIGNOR]

By:       Title:

 

ASSIGNEE

 

[NAME OF ASSIGNEE]

By:       Title:

 

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

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

Exhibit A

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[Consented to and]4 Accepted:

 

JPMORGAN CHASE BANK, N.A., as

Administrative Agent

By       Title:

 

[Consented to:]5

 

LIFETIME BRANDS, INC.

By       Title:

 

4  To be added only if the consent of the Administrative Agent is required by
the terms of the Credit Agreement.

5  To be added only if the consent of the Company and/or other parties (e.g.
Swingline Lender, Issuing Bank) is required by the terms of the Credit
Agreement.

Exhibit A

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

ANNEX 1

[                                  ]6

STANDARD TERMS AND CONDITIONS FOR

ASSIGNMENT AND ASSUMPTION

1. Representations and Warranties.

1.1 Assignor. The Assignor (a) represents and warrants that (i) it is the legal
and beneficial owner of the Assigned Interest, (ii) the Assigned Interest is
free and clear of any lien, encumbrance or other adverse claim and (iii) it has
full power and authority, and has taken all action necessary, to execute and
deliver this Assignment and Assumption and to consummate the transactions
contemplated hereby; and (b) assumes no responsibility with respect to (i) any
statements, warranties or representations made in or in connection with the
Credit Agreement or any other Loan Document, (ii) the execution, legality,
validity, enforceability, genuineness, sufficiency or value of the Loan
Documents or any collateral thereunder, (iii) the financial condition of any
Borrower, any of its Subsidiaries or Affiliates or any other Person obligated in
respect of any Loan Document or (iv) the performance or observance by any
Borrower, any of its Subsidiaries or Affiliates or any other Person of any of
their respective obligations under any Loan Document.

1.2. Assignee. The Assignee (a) represents and warrants that (i) it has full
power and authority, and has taken all action necessary, to execute and deliver
this Assignment and Assumption and to consummate the transactions contemplated
hereby and to become a Lender under the Credit Agreement, (ii) it satisfies the
requirements, if any, specified in the Credit Agreement that are required to be
satisfied by it in order to acquire the Assigned Interest and become a Lender,
(iii) from and after the Effective Date, it shall be bound by the provisions of
the Credit Agreement as a Lender thereunder and, to the extent of the Assigned
Interest, shall have the obligations of a Lender thereunder, (iv) it has
received a copy of the Credit Agreement, together with copies of the most recent
financial statements delivered pursuant to Section thereof, as applicable, 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 Assumption
and to purchase the Assigned Interest on the basis of which it has made such
analysis and decision independently and without reliance on the Administrative
Agent or any other Lender, and (v) if it is a Non-U.S. Lender, attached to the
Assignment and Assumption is any documentation required to be delivered by it
pursuant to the terms of the Credit Agreement, duly completed and executed by
the Assignee; and (b) agrees that (i) it will, independently and without
reliance on the Administrative Agent, the Assignor or any other Lender, and
based on such documents and information as it shall deem appropriate at the
time, continue to make its own credit decisions in taking or not taking action
under the Loan Documents, and (ii) it will perform in accordance with their
terms all of the obligations which by the terms of the Loan Documents are
required to be performed by it as a Lender.

2. Payments. From and after the Effective Date, the Administrative Agent shall
make all payments in respect of the Assigned Interest (including payments of
principal, interest, fees and other amounts) to the Assignor for amounts which
have accrued to but excluding the Effective Date and to the Assignee for amounts
which have accrued from and after the Effective Date.

3. General Provisions. This Assignment and Assumption shall be binding upon, and
inure to the benefit of, the parties hereto and their respective successors and
assigns. This Assignment and Assumption may be executed in any number of
counterparts, which together shall constitute one instrument.

 

6  Describe Credit Agreement at option of Administrative Agent.

Exhibit A

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

Delivery of an executed counterpart of a signature page of this Assignment and
Assumption by facsimile shall be effective as delivery of a manually executed
counterpart of this Assignment and Assumption. This Assignment and Assumption
shall be construed in accordance with and governed by the law of the State of
New York, but giving effect to federal laws applicable to national banks.

Exhibit A

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

EXHIBIT B

OPINION OF COUNSEL FOR THE LOAN PARTIES

[Attached]

Exhibit B

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

EXHIBIT C

BORROWING BASE CERTIFICATE

[Attached]

Exhibit C

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LOGO [g608281p156.jpg]

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LOGO [g608281p157.jpg]

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LOGO [g608281p158.jpg]

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LOGO [g608281p159.jpg]

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EXHIBIT D

COMPLIANCE CERTIFICATE

 

To: The Lenders parties to the

Credit Agreement Described Below

This Compliance Certificate is furnished pursuant to that certain Amended and
Restated Credit Agreement dated as of October 28, 2011 (as amended, modified,
renewed or extended from time to time, the “Agreement”) among Lifetime Brands,
Inc. (the “Company”), the Foreign Subsidiary Borrowers party thereto, the other
Loan Parties, the Lenders party thereto and JPMorgan Chase Bank, N.A., as
Administrative Agent for the Lenders and as the Issuing Bank. Unless otherwise
defined herein, capitalized terms used in this Compliance Certificate have the
meanings ascribed thereto in the Agreement.

THE UNDERSIGNED HEREBY CERTIFIES THAT:

1. I am the duly elected of the Company;

2. I have reviewed the terms of the Agreement and I have made, or have caused to
be made under my supervision, a detailed review of the transactions and
conditions of the Company and its Subsidiaries during the accounting period
covered by the attached financial statements [for quarterly or monthly financial
statements add: and such financial statements present fairly in all material
respects the financial condition and results of operations of the Company and
its consolidated Subsidiaries on a consolidated basis in accordance with GAAP
consistently applied, subject to normal year-end audit adjustments and the
absence of footnotes];

3. The examinations described in paragraph 2 did not disclose, except as set
forth below, and I have no knowledge of (i) the existence of any condition or
event which constitutes a Default during or at the end of the accounting period
covered by the attached financial statements or as of the date of this
Certificate or (ii) any change in GAAP or in the application thereof that has
occurred since the date of the audited financial statements referred to in
Section 3.04 of the Agreement;

4. I hereby certify that no Loan Party has changed (i) its name, (ii) its chief
executive office, (iii) principal place of business, (iv) the type of entity it
is or (v) its state of incorporation or organization without having given the
Agent the notice required by Section 4.15 of the Domestic Security Agreement (or
any similar provision in any Foreign Security Agreement);

5. Schedule I attached hereto sets forth financial data and computations
evidencing the Fixed Charge Coverage Ratio for the most recently ended four
(4) fiscal quarters and the Company’s compliance with certain covenants of the
Agreement, all of which data and computations are true, complete and correct;
and

6. Schedule II hereto sets forth the computations necessary to determine the
Applicable Rate commencing on the Business Day this certificate is delivered.

Described below are the exceptions, if any, to paragraph 3 by listing, in
detail, the (i) nature of the condition or event, the period during which it has
existed and the action which the Company has taken, is taking, or proposes to
take with respect to each such condition or event or (i) the change in GAAP or
the application thereof and the effect of such change on the attached financial
statements:

 

Exhibit D

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

     

 

Exhibit D

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

The foregoing certifications, together with the computations set forth in
Schedule I and Schedule II hereto and the financial statements delivered with
this Certificate in support hereof, are made and delivered this         day
of             ,         .

 

LIFETIME BRANDS, INC. By:     Name:     Title:    

 

Exhibit D

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

SCHEDULE I

Compliance as of                 ,             with

Provisions of             and             of

the Agreement

 

Exhibit D

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

SCHEDULE II

Company’s Applicable Rate Calculation

 

Exhibit D

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

EXHIBIT E

JOINDER AGREEMENT

THIS JOINDER AGREEMENT (this “Agreement”), dated as of             ,         ,
20    , is entered into between [New Subsidiary], a [    ] (the “New
Subsidiary”) and JPMorgan Chase Bank, N.A., in its capacity as administrative
agent (the “Administrative Agent”) under that certain Amended and Restated
Credit Agreement, dated as of October 28, 2011 among Lifetime Brands, Inc. (the
“Company”), the Foreign Subsidiary Borrowers party thereto, the Loan Parties
party thereto, the Lenders party thereto and the Administrative Agent (as the
same may be amended, modified, extended or restated from time to time, the
“Credit Agreement”). All capitalized terms used herein and not otherwise defined
shall have the meanings set forth in the Credit Agreement.

The New Subsidiary and the Administrative Agent, for the benefit of the Lenders,
hereby agree as follows:

1. The New Subsidiary hereby acknowledges, agrees and confirms that, by its
execution of this Agreement, the New Subsidiary will be deemed to be a Loan
Party under the Credit Agreement and a “Loan Guarantor” for all purposes of the
Credit Agreement and shall have all of the obligations of a Loan Party and a
Loan Guarantor thereunder as if it had executed the Credit Agreement. The New
Subsidiary hereby ratifies, as of the date hereof, and agrees to be bound by,
all of the terms, provisions and conditions contained in the Credit Agreement,
including without limitation (a) all of the representations and warranties of
the Loan Parties set forth in Article III of the Credit Agreement, (b) all of
the covenants set forth in Articles V and VI of the Credit Agreement and (c) all
of the guaranty obligations set forth in Article X of the Credit Agreement.
Without limiting the generality of the foregoing terms of this paragraph 1, the
New Subsidiary, subject to the limitations set forth in Sections 10.10 and 10.13
of the Credit Agreement, hereby (i) guarantees, jointly and severally with the
other Loan Guarantors, to the Administrative Agent and the Lenders, as provided
in Article X of the Credit Agreement, the prompt payment and performance of the
Guaranteed Obligations in full when due (whether at stated maturity, as a
mandatory prepayment, by acceleration or otherwise) strictly in accordance with
the terms thereof and (ii) agrees that if any of the Guaranteed Obligations are
not paid or performed in full when due (whether at stated maturity, as a
mandatory prepayment, by acceleration or otherwise), the New Subsidiary will,
jointly and severally together with the other Loan Guarantors, promptly pay and
perform the same, without any demand or notice whatsoever, and that in the case
of any extension of time of payment or renewal of any of the Guaranteed
Obligations, the same will be promptly paid in full when due (whether at
extended maturity, as a mandatory prepayment, by acceleration or otherwise) in
accordance with the terms of such extension or renewal.

2. If required, the New Subsidiary is, simultaneously with the execution of this
Agreement, executing and delivering such Collateral Documents (and such other
documents and instruments) as requested by the Administrative Agent in
accordance with the Credit Agreement.

3. The address of the New Subsidiary for purposes of Section 9.01 of the Credit
Agreement is as follows:

 

                           

 

Exhibit E

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

4. The New Subsidiary hereby waives acceptance by the Administrative Agent and
the Lenders of the guaranty by the New Subsidiary upon the execution of this
Agreement by the New Subsidiary.

5. This Agreement may be executed in any number of counterparts, each of which
when so executed and delivered shall be an original, but all of which shall
constitute one and the same instrument.

6. THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER SHALL
BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAW OF THE STATE OF NEW
YORK, BUT GIVING EFFECT TO FEDERAL LAWS APPLICABLE TO NATIONAL BANKS.

IN WITNESS WHEREOF, the New Subsidiary has caused this Agreement to be duly
executed by its authorized officer, and the Administrative Agent, for the
benefit of the Lenders, has caused the same to be accepted by its authorized
officer, as of the day and year first above written.

 

[NEW SUBSIDIARY] By:     Name:     Title:    

 

Acknowledged and accepted:

 

JPMORGAN CHASE BANK, N.A., as Administrative Agent

By:     Name:     Title:    

 

Exhibit E

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EXHIBIT F

LIFETIME BRANDS, INC.

CERTAIN FOREIGN SUBSIDIARY BORROWERS

AMENDED AND RESTATED CREDIT FACILITIES

October 28, 2011

LIST OF CLOSING DOCUMENTS7

A. LOAN DOCUMENTS

 

1. Amended and Restated Credit Agreement (the “Credit Agreement”) by and among
Lifetime Brands, Inc., a Delaware corporation (the “Company”), the Foreign
Subsidiary Borrowers from time to time parties thereto (collectively with the
Company, the “Borrowers”), the other Loan Parties party thereto, the financial
institutions from time to time parties thereto as Lenders (the “Lenders”) and
JPMorgan Chase Bank, N.A., in its capacity as Administrative Agent for itself
and the other Lenders (the “Administrative Agent”), evidencing a revolving
credit facility to the Borrowers from the Lenders in an initial aggregate
principal amount of $150,000,000.

SCHEDULES

 

 

Schedule 2.01

  —    Commitments  

Schedule 2.02

  —    Mandatory Cost  

Schedule 2.07

  —    Existing Letters of Credit  

Schedule 3.05

  —    Properties  

Schedule 3.06

  —    Disclosed Matters  

Schedule 3.14

  —    Insurance  

Schedule 3.15

  —    Capitalization and Subsidiaries  

Schedule 6.01

  —    Existing Indebtedness  

Schedule 6.02

  —    Existing Liens  

Schedule 6.04

  —    Existing Investments  

Schedule 6.10

  —    Existing Restrictions

 

EXHIBITS

 

 

Exhibit A

  —    Form of Assignment and Assumption  

Exhibit B

  —    Forms of Opinions of Loan Parties’ Counsels  

Exhibit C

  —    Form of Borrowing Base Certificate  

Exhibit D

  —    Form of Compliance Certificate  

Exhibit E

  —    Joinder Agreement  

Exhibit F

  —    List of Closing Documents  

Exhibit G-1

  —    Form of U.S. Tax Certificate Form of U.S. Tax Certificate (for       
Non-U.S. [Lenders][Participants] That Are Not Partnerships)  

Exhibit G-2

  —    Form of U.S. Tax Certificate (for Non-U.S.

 

7  Each capitalized term used herein and not defined herein shall have the
meaning assigned to such term in the above-defined Credit Agreement.

 

Exhibit F

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       [Lenders][Participants] That Are Partnerships)  

Exhibit H-1

  —    Form of Borrowing Subsidiary Agreement  

Exhibit H-2

  —    Form of Borrowing Subsidiary Termination

 

2. Amended and Restated Pledge and Security Agreement, executed by the Domestic
Loan Parties, together with pledged instruments and allonges, stock
certificates, stock powers executed in blank, pledge instructions and
acknowledgments, as appropriate.

 

 

Exhibit A

  —    Type of Entity; Principal Place of Business or Chief Executive Office;  
     FEIN; State Organization Number; Jurisdiction of Incorporation;       
Properties Leased by the Grantors; Properties Owned by the Grantors;       
Public Warehouses or Other Locations  

Exhibit B

  —    Deposit Accounts; Lock Boxes; Securities Accounts  

Exhibit C

  —    Letter of Credit Rights; Chattel Paper  

Exhibit D

  —    Patents; Trademarks; Copyrights  

Exhibit E

  —    Title Documents  

Exhibit F

  —    Fixtures  

Exhibit G

  —    List of Pledged Collateral, Securities and other Investment Property  

Exhibit H

  —    UCC Financing Statement Filing Locations  

Exhibit I

  —    Form of Amendment  

Exhibit J

  —    Assigned Contracts  

Exhibit K

  —    Commercial Tort Claims

 

3. Amendment No. 2 to Second Lien Credit Agreement, by and among the Company,
the other Loan Parties party thereto, the financial institutions party thereto
as lenders and Citibank, N.A., in its capacity as administrative agent and
collateral agent.

 

4. Amendment No. 1 to Intercreditor Agreement, by and among the Administrative
Agent, Citibank, N.A., in its capacity as administrative agent under the Second
Lien Documents, and the Loan Parties.

B. UCC/INTELLECTUAL PROPERTY DOCUMENTS

 

5. UCC, tax lien and name variation search reports naming each Loan Party from
the appropriate offices in relevant jurisdictions.

 

6. Intellectual property search reports under the name of each Loan Party in
each of the U.S. Copyright Office and the U.S. Patent and Trademark Office.

C. CORPORATE DOCUMENTS

 

7. Certificate of the Secretary or an Assistant Secretary of each Loan Party
certifying (i) that there have been no changes in the Certificate of
Incorporation or other charter document of such Loan Party, as attached thereto
and as certified as of a recent date by the Secretary of State (or the
equivalent thereof) of the jurisdiction of its organization, since the date of
the certification thereof by such Secretary of State (or the equivalent
thereof), (ii) the By-Laws or other applicable organizational document, as
attached thereto, of such Loan Party as in effect on the date of such
certification, (iii) resolutions of the Board of Directors or other governing
body of such Loan Party authorizing the execution, delivery and performance of
each Loan Document to which it is a party, and (iv) the names and true
signatures of the incumbent officers of each Loan Party authorized to sign the
Loan Documents to which it is a party, and (in the case of the Company)
authorized to request a Borrowing or the issuance of a Letter of Credit under
the Credit Agreement.

 

Exhibit F

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8. Good Standing Certificate (or analogous documentation if applicable) for each
Loan Party from the Secretary of State (or the equivalent thereof) of the
jurisdiction of its organization, to the extent generally available in such
jurisdiction.

D. OPINION

 

9. Opinion of Nixon Peabody LLP, U.S. counsel for the Loan Parties.

E. CLOSING CERTIFICATES AND MISCELLANEOUS

 

10. A certificate signed by the chief financial officer of the Company, dated as
of the Effective Date: (i) stating that no Default has occurred and is
continuing; (ii) stating that the representations and warranties contained in
Article III of the Credit Agreement are true and correct as of such date,
(iii) certifying any other factual matters as may be reasonably requested by the
Administrative Agent and (iv) stating that, after giving effect to the
Transactions, the Loan Parties, taken as a whole, are solvent and will be
solvent subsequent to incurring the Indebtedness in connection with the
Transactions.

E. POST-CLOSING DOCUMENTS

 

11. Foreign Security Agreements, together with all other items in Section 4.03
of the Credit Agreement.

 

Exhibit F

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EXHIBIT G-1

[FORM OF]

U.S. TAX CERTIFICATE

(For Non-U.S. [Lenders][Participants]1 That Are Not Partnerships For U.S.
Federal Income Tax Purposes)

Reference is hereby made to the Amended and Restated Credit Agreement, dated as
of October 28, 2011 (as amended, supplemented or otherwise modified from time to
time, the “Credit Agreement”) among Lifetime Brands, Inc., the Foreign
Subsidiary Borrowers from time to time party thereto, the other Loan Parties
party thereto, each lender from time to time party thereto and JPMorgan Chase
Bank, N.A., as Administrative Agent.

Pursuant to the provisions of Section 2.18 of the Credit Agreement, the
undersigned hereby certifies that (i) it is the sole record and beneficial owner
of the [Loan(s) (as well as any Note(s) evidencing such Loan(s))][participation]
in respect of which it is providing this certificate, (ii) it is not a bank
within the meaning of Section 881(c)(3)(A) of the Code, (iii) it is not a ten
percent shareholder of any Borrower within the meaning of Section 871(h)(3)(B)
of the Code, (iv) it is not a controlled foreign corporation related to any
Borrower as described in Section 881(c)(3)(C) of the Code and (v) the interest
payments in question are not effectively connected with the undersigned’s
conduct of a U.S. trade or business.

The undersigned has furnished [the Administrative Agent and the Borrower
Representative][its participating Lender] with a certificate of its non-U.S.
person status on IRS Form W- 8BEN. By executing this certificate, the
undersigned agrees that (1) if the information provided on this certificate
changes, the undersigned shall promptly so inform [the Borrower Representative
and the Administrative Agent][such Lender] and (2) the undersigned shall have at
all times furnished [the Borrower Representative and the Administrative
Agent][such Lender] with a properly completed and currently effective
certificate in either the calendar year in which each payment is to be made to
the undersigned, or in either of the two calendar years preceding such payments.

Unless otherwise defined herein, terms defined in the Credit Agreement and used
herein shall have the meanings given to them in the Credit Agreement.

 

[NAME OF LENDER OR PARTICIPANT] By:       Name:   Title:

Date:             , 20[     ]

 

1  This form can be used for Lenders or Participants. Select the appropriate
bracketed phrases.

 

Exhibit G

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EXHIBIT G-2

[FORM OF]

U.S. TAX CERTIFICATE

(For Non-U.S. [Lenders][Participants]1 That Are Partnerships For U.S. Federal
Income Tax Purposes)

Reference is hereby made to the Amended and Restated Credit Agreement, dated as
of October 28, 2011 (as amended, supplemented or otherwise modified from time to
time, the “Credit Agreement”) among Lifetime Brands, Inc., the Foreign
Subsidiary Borrowers from time to time party thereto, the other Loan Parties
party thereto, each lender from time to time party thereto and JPMorgan Chase
Bank, N.A., as Administrative Agent.

Pursuant to the provisions of Section 2.18 of the Credit Agreement, the
undersigned hereby certifies that (i) it is the sole record owner of the
[Loan(s) (as well as any Note(s) evidencing such Loan(s))][participation] in
respect of which it is providing this certificate, (ii) its partners/members are
the sole beneficial owners of such [Loan(s) (as well as any Note(s) evidencing
such Loan(s))][participation], (iii) with respect to [the extension of credit
pursuant to this Credit Agreement][participation], neither the undersigned nor
any of its partners/members is a bank extending credit pursuant to a loan
agreement entered into in the ordinary course of its trade or business within
the meaning of Section 881(c)(3)(A) of the Code, (iv) none of its
partners/members is a ten percent shareholder of any Borrower within the meaning
of Section 871(h)(3)(B) of the Code, (v) none of its partners/members is a
controlled foreign corporation related to any Borrower as described in
Section 881(c)(3)(C) of the Code, and (vi) the interest payments in question are
not effectively connected with the undersigned’s or its partners/members’
conduct of a U.S. trade or business.

The undersigned has furnished [the Administrative Agent and the Borrower
Representative][its participating Lender] with IRS Form W-8IMY accompanied by an
IRS Form W- 8BEN from each of its partners/members claiming the portfolio
interest exemption. By executing this certificate, the undersigned agrees that
(1) if the information provided on this certificate changes, the undersigned
shall promptly so inform [the Borrower Representative and the Administrative
Agent][such Lender] and (2) the undersigned shall have at all times furnished
[the Borrower Representative and the Administrative Agent][such Lender] with a
properly completed and currently effective certificate in either the calendar
year in which each payment is to be made to the undersigned, or in either of the
two calendar years preceding such payments.

Unless otherwise defined herein, terms defined in the Credit Agreement and used
herein shall have the meanings given to them in the Credit Agreement.

 

[NAME OF LENDER OR PARTICIPANT] By:       Name:   Title:

Date:             , 20[     ]

 

1  This form can be used for Lenders and Participants. Select the appropriate
bracketed phrases.

 

 

Exhibit G

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

EXHIBIT H-1

[FORM OF]

BORROWING SUBSIDIARY AGREEMENT

BORROWING SUBSIDIARY AGREEMENT dated as of [            ], among Lifetime
Brands, Inc., a Delaware corporation (the “Company”), [Name of Foreign
Subsidiary Borrower], a [            ] (the “New Borrowing Subsidiary”), and
JPMorgan Chase Bank, N.A. as Administrative Agent (the “Administrative Agent”).

Reference is hereby made to the Amended and Restated Credit Agreement, dated as
of October 28, 2011 (as amended, restated, supplemented or otherwise modified
from time to time, the “Credit Agreement”), among the Company, the Foreign
Subsidiary Borrowers from time to time party thereto, the Lenders from time to
time party thereto, and JPMorgan Chase Bank, N.A., as Administrative Agent.
Capitalized terms used herein but not otherwise defined herein shall have the
meanings assigned to such terms in the Credit Agreement. Under the Credit
Agreement, the Lenders have agreed, upon the terms and subject to the conditions
therein set forth, to make Loans to certain Foreign Subsidiary Borrowers
(collectively with the Company, the “Borrowers”), and the Company and the New
Borrowing Subsidiary desire that the New Borrowing Subsidiary become a Foreign
Subsidiary Borrower. In addition, the New Borrowing Subsidiary hereby authorizes
the Company to act on its behalf as and to the extent provided for in Article II
of the Credit Agreement. [Notwithstanding the preceding sentence, the New
Borrowing Subsidiary hereby designates the following officers as being
authorized to request Borrowings under the Credit Agreement on behalf of the New
Subsidiary Borrower and sign this Borrowing Subsidiary Agreement and the other
Loan Documents to which the New Borrowing Subsidiary is, or may from time to
time become, a party: [            ].]

Each of the Company and the New Borrowing Subsidiary represents and warrants
that (a) the representations and warranties of the Company in the Credit
Agreement relating to the New Borrowing Subsidiary and this Agreement are true
and correct on and as of the date hereof, other than representations given as of
a particular date, in which case they shall be true and correct as of that date,
and (b) the execution, delivery and performance by the New Borrowing Subsidiary
of the transactions contemplated under this Agreement and the use of any of the
proceeds raised in connection with this Agreement will not contravene or
conflict with, or otherwise constitute unlawful financial assistance under,
Sections 677 to 683 (inclusive) of the United Kingdom Companies Act 2006 (as
amended). [INSERT OTHER PROVISIONS REASONABLY REQUESTED BY ADMINISTRATIVE AGENT
OR ITS COUNSELS]. The Company agrees that the Guarantee Obligations of the
Company contained in the Credit Agreement will apply to the Obligations of the
New Borrowing Subsidiary. Upon execution of this Agreement by each of the
Company, the New Borrowing Subsidiary and the Administrative Agent, the New
Borrowing Subsidiary shall be a party to the Credit Agreement and shall
constitute a “Foreign Subsidiary Borrower” for all purposes thereof, and the New
Borrowing Subsidiary hereby agrees to be bound by all provisions of the Credit
Agreement.

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

Exhibit H-1

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

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed by their authorized officers as of the date first appearing above.

 

LIFETIME BRANDS, INC. By:       Name:   Title:

 

[NAME OF NEW BORROWING SUBSIDIARY] By:       Name:   Title:

 

JPMORGAN CHASE BANK, N.A., as

Administrative Agent

By:       Name:   Title:

Exhibit H-1

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

EXHIBIT H-2

[FORM OF]

BORROWING SUBSIDIARY TERMINATION

JPMorgan Chase Bank, N.A.

as Administrative Agent

for the Lenders referred to below

270 Park Avenue

New York, NY 10017

Attention: Robert A. Kaulius

[Date]

Ladies and Gentlemen:

The undersigned, Lifetime Brands, Inc. (the “Company”), refers to the Amended
and Restated Credit Agreement, dated as of October 28, 2011 (as amended,
restated, supplemented or otherwise modified from time to time, the “Credit
Agreement”), among the Company, Lifetime Brands, Inc., the Foreign Subsidiary
Borrowers from time to time party thereto, and JPMorgan Chase Bank, N.A., as
Administrative Agent. Capitalized terms used and not otherwise defined herein
shall have the meanings assigned to such terms in the Credit Agreement.

The Company hereby terminates the status of [    ] (the “Terminated Borrowing
Subsidiary”) as a Foreign Subsidiary Borrower under the Credit Agreement. [The
Company represents and warrants that no Loans made to the Terminated Borrowing
Subsidiary are outstanding as of the date hereof and that all amounts payable by
the Terminated Borrowing Subsidiary in respect of interest and/or fees (and, to
the extent notified by the Administrative Agent or any Lender, any other amounts
payable under the Credit Agreement) pursuant to the Credit Agreement have been
paid in full on or prior to the date hereof.] [The Company acknowledges that the
Terminated Borrowing Subsidiary shall continue to be a Borrower until such time
as all Loans made to the Terminated Borrowing Subsidiary shall have been
prepaid, any outstanding Letters of Credit have been cash collateralized in an
amount and on terms reasonably satisfactory to the Administrative Agent, and all
amounts payable by the Terminated Borrowing Subsidiary in respect of interest
and/or fees (and, to the extent notified by the Administrative Agent or any
Lender, any other amounts payable under the Credit Agreement) pursuant to the
Credit Agreement shall have been paid in full, provided that the Terminated
Borrowing Subsidiary shall not have the right to make further Borrowings under
the Credit Agreement.]

[Signature Page Follows]

Exhibit H-2

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

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

 

Very truly yours,

 

LIFETIME BRANDS, INC.

By:       Name:   Title:

Exhibit H-2