Exhibit 10.1

 

[EXECUTION

COUNTERPART]

 

[Published CUSIP Number: 035255108]

 

 

CREDIT AGREEMENT

 

Dated as of January 31, 2008

 

 

among

 

 

ANIKA THERAPEUTICS, INC.

as Borrower,

 

ANIKA SECURITIES, INC.

as a Guarantor,

 

 

BANK OF AMERICA, N.A.,
as Administrative Agent,

 

 

and

The Other Lenders Party Hereto

 

 

 

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TABLE OF CONTENTS

 

Section

 

 

Page

 

 

 

 

ARTICLE I.

DEFINITIONS AND ACCOUNTING TERMS

1

 

 

 

 

 

1.01

Defined Terms

1

 

 

 

 

 

1.02

Other Interpretive Provisions

18

 

 

 

 

 

1.03

Accounting Terms

19

 

 

 

 

 

1.04

Rounding

19

 

 

 

 

 

1.05

Times of Day

19

 

 

 

 

ARTICLE II.

THE COMMITMENTS AND BORROWINGS

19

 

 

 

 

 

2.01

Revolving Credit Borrowings

19

 

 

 

 

 

2.02

Borrowings, Conversions and Continuations of Loans

20

 

 

 

 

 

2.03

Term Borrowings

21

 

 

 

 

 

2.04

[Reserved]

21

 

 

 

 

 

2.05

Prepayments

21

 

 

 

 

 

2.06

Termination or Reduction of Commitments

22

 

 

 

 

 

2.07

Repayment of Loans

22

 

 

 

 

 

2.08

Interest

23

 

 

 

 

 

2.09

Fees

23

 

 

 

 

 

2.10

Computation of Interest and Fees

24

 

 

 

 

 

2.11

Evidence of Debt

24

 

 

 

 

 

2.12

Payments Generally; Agent’s Clawback

24

 

 

 

 

 

2.13

Sharing of Payments

26

 

 

 

 

ARTICLE III.

TAXES, YIELD PROTECTION AND ILLEGALITY

27

 

 

 

 

 

3.01

Taxes

27

 

 

 

 

 

3.02

Illegality

28

 

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3.03

Inability to Determine Rates

28

 

 

 

 

 

3.04

Increased Costs

29

 

 

 

 

 

3.05

Compensation for Losses

30

 

 

 

 

 

3.06

Mitigation Obligations

31

 

 

 

 

 

3.07

Survival

31

 

 

 

 

ARTICLE IV.

CONDITIONS PRECEDENT TO BORROWINGS

31

 

 

 

 

 

4.01

Conditions of Initial Borrowing

31

 

 

 

 

 

4.02

Conditions to all Borrowings

33

 

 

 

 

ARTICLE V.

REPRESENTATIONS AND WARRANTIES

33

 

 

 

 

 

5.01

Existence, Qualification and Power

33

 

 

 

 

 

5.02

Authorization; No Contravention

34

 

 

 

 

 

5.03

Governmental Authorization; Other Consents

34

 

 

 

 

 

5.04

Binding Effect

34

 

 

 

 

 

5.05

Financial Statements; No Material Adverse Effect

34

 

 

 

 

 

5.06

Litigation

35

 

 

 

 

 

5.07

No Default

35

 

 

 

 

 

5.08

Ownership of Property; Liens

35

 

 

 

 

 

5.09

Environmental Compliance

35

 

 

 

 

 

5.10

Insurance

36

 

 

 

 

 

5.11

Taxes

36

 

 

 

 

 

5.12

ERISA Compliance

36

 

 

 

 

 

5.13

Subsidiaries

36

 

 

 

 

 

5.14

Margin Regulations; Investment Company Act

37

 

 

 

 

 

5.15

Disclosure

37

 

 

 

 

 

5.16

Compliance with Laws

37

 

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5.17

Taxpayer Identification Number

37

 

 

 

 

 

5.18

Intellectual Property; Licenses, Etc

37

 

 

 

 

ARTICLE VI.

AFFIRMATIVE COVENANTS

38

 

 

 

 

 

6.01

Financial Statements

38

 

 

 

 

 

6.02

Certificates; Other Information

39

 

 

 

 

 

6.03

Notices

40

 

 

 

 

 

6.04

Payment of Obligations

41

 

 

 

 

 

6.05

Preservation of Existence, Etc

41

 

 

 

 

 

6.06

Maintenance of Properties

41

 

 

 

 

 

6.07

Maintenance of Insurance

41

 

 

 

 

 

6.08

Compliance with Laws

42

 

 

 

 

 

6.09

Books and Records

42

 

 

 

 

 

6.10

Inspection Rights

42

 

 

 

 

 

6.11

Use of Proceeds

42

 

 

 

 

 

6.12

Financial Covenants

42

 

 

 

 

 

6.13

Additional Guarantors

42

 

 

 

 

ARTICLE VII.

NEGATIVE COVENANTS

43

 

 

 

 

 

7.01

Liens

43

 

 

 

 

 

7.02

Investments

44

 

 

 

 

 

7.03

Indebtedness

46

 

 

 

 

 

7.04

Fundamental Changes

47

 

 

 

 

 

7.05

Dispositions

47

 

 

 

 

 

7.06

Restricted Payments

48

 

 

 

 

 

7.07

Change in Nature of Business

48

 

 

 

 

 

7.08

Transactions with Affiliates

49

 

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7.09

Burdensome Agreements

49

 

 

 

 

 

7.10

Use of Proceeds

49

 

 

 

 

ARTICLE VIII.

EVENTS OF DEFAULT AND REMEDIES

49

 

 

 

 

 

8.01

Events of Default

49

 

 

 

 

 

8.02

Remedies Upon Event of Default

52

 

 

 

 

 

8.03

Application of Funds

52

 

 

 

 

ARTICLE IX.

ADMINISTRATIVE AGENT

53

 

 

 

 

 

9.01

Appointment and Authorization of Administrative Agent

53

 

 

 

 

 

9.02

Rights as a Lender

53

 

 

 

 

 

9.03

Exculpatory Provisions

53

 

 

 

 

 

9.04

Reliance by Administrative Agent

54

 

 

 

 

 

9.05

Delegation of Duties

54

 

 

 

 

 

9.06

Resignation of Agent

54

 

 

 

 

 

9.07

Non-Reliance on Agent and Other Lenders

55

 

 

 

 

 

9.08

No Other Duties, Etc

55

 

 

 

 

 

9.09

Administrative Agent May File Proofs of Claim

55

 

 

 

 

 

9.10

Guaranty Matters

56

 

 

 

 

ARTICLE X.

CONTINUING GUARANTY

56

 

 

 

 

 

10.01

Guaranty

56

 

 

 

 

 

10.02

Rights of Lenders

56

 

 

 

 

 

10.03

Certain Waivers

57

 

 

 

 

 

10.04

Obligations Independent

57

 

 

 

 

 

10.05

Subrogation

57

 

 

 

 

 

10.06

Termination; Reinstatement

57

 

 

 

 

 

10.07

Subordination

58

 

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10.08

Stay of Acceleration

58

 

 

 

 

 

10.09

Condition of Borrower

58

 

 

 

 

 

10.10

Rights of Contribution

58

 

 

 

 

 

10.11

General Limitation on Guarantee Obligations

59

 

 

 

 

 

10.12

Joint and Several Obligations

59

 

 

 

 

ARTICLE XI.

MISCELLANEOUS

60

 

 

 

 

 

11.01

Amendments, Etc

60

 

 

 

 

 

11.02

Notices; Effectiveness; Electronic Communications

61

 

 

 

 

 

11.03

No Waiver; Cumulative Remedies

63

 

 

 

 

 

11.04

Expenses; Indemnity; Damage Waiver

63

 

 

 

 

 

11.05

Payments Set Aside

65

 

 

 

 

 

11.06

Successors and Assigns

65

 

 

 

 

 

11.07

Treatment of Certain Information; Confidentiality

68

 

 

 

 

 

11.08

Right of Setoff

69

 

 

 

 

 

11.09

Interest Rate Limitation

69

 

 

 

 

 

11.10

Counterparts; Integration; Effectiveness

70

 

 

 

 

 

11.11

Survival of Representations and Warranties

70

 

 

 

 

 

11.12

Severability

70

 

 

 

 

 

11.13

Governing Law; Jurisdiction; Etc.

70

 

 

 

 

 

11.14

WAIVER OF JURY TRIAL

71

 

 

 

 

 

11.15

No Advisory or Fiduciary Responsibility

72

 

 

 

 

 

11.16

USA Patriot Act Notice

72

 

 

 

 

 

11.17

Time of the Essence

72

 

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SCHEDULES

 

 

 

 

 

 

 

 

2.01

Commitments and Applicable Percentages

 

 

5.06

Litigation

 

 

5.09

Environmental Matters

 

 

5.13

Subsidiaries and Other Equity Investments

 

 

7.01

Existing Liens

 

 

7.02

Existing Investments

 

 

7.03

Existing Indebtedness

 

 

10.02

Administrative Agent’s Office, Certain Addresses for Notices

 

 

 

 

 

EXHIBITS

 

 

 

 

Form of

 

 

 

A.

Committed Loan Notice

 

 

C-1.

Revolving Credit Note

 

 

C-2.

Term Note

 

 

D.

Compliance Certificate

 

 

E.

Assignment and Assumption

 

 

vi

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CREDIT AGREEMENT

 

CREDIT AGREEMENT (this “Agreement”) is entered into as of January 31, 2008 among
ANIKA THERAPEUTICS, INC., a Massachusetts corporation (“Borrower”), ANIKA
SECURITIES, INC., a Massachusetts securities corporation (“Anika Securities”),
each lender from time to time party hereto (collectively, “Lenders” and
individually, a “Lender”), and BANK OF AMERICA, N.A., as Administrative Agent.

 

Borrower has requested that Lenders provide a revolving credit and term loan
facility, and Lenders are willing to do so on the terms and conditions set forth
herein.  In consideration of the mutual covenants and agreements herein
contained, the parties hereto covenant and agree as follows:

 

ARTICLE I.           DEFINITIONS AND ACCOUNTING TERMS

 

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

 

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

 

“Administrative Agent’s Office” means Agent’s address and, as appropriate,
account as set forth on Schedule 10.02, or such other address or account as
Agent may from time to time notify Borrower and Lenders.

 

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

 

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

 

“Aggregate Commitments” means the Commitments of all Lenders.

 

“Agreement” means this Credit Agreement.

 

“Anika Securities” has the meaning specified in the introductory paragraph
hereto.

 

“Applicable Percentage” means with respect to any Lender at any time, (a) during
the Availability Period, the percentage (carried out to the ninth decimal place)
of the Aggregate Commitments represented by such Lender’s Commitments at such
time and (b) after the Availability Period, the percentage (carried out to the
ninth decimal place) of all Loans represented by the principal amount of such
Lender’s Loans at such time.  The initial Applicable Percentage of each Lender
is set forth opposite the name of such Lender on Schedule 2.01 or in the
Assignment and Assumption pursuant to which such Lender becomes a party hereto,
as applicable.

 

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“Applicable Rate” means a per annum rate equal to:

 

(a)           with respect to Base Rate Loans, 0.00%;

 

(b)           with respect to Eurodollar Rate Loans, 0.75%; and

 

(c)           with respect to the commitment fee, 0.25%.

 

“Assignee Group” means two or more Eligible Assignees that are Affiliates of one
another.

 

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

 

“Attributable Indebtedness” means, on any date, (a) in respect of any capital
lease of any Person, the capitalized amount thereof that would appear on a
balance sheet of such Person prepared as of such date in accordance with GAAP,
and (b) in respect of any Synthetic Lease Obligation, the capitalized amount of
the remaining lease payments under the relevant lease that would appear on a
balance sheet of such Person prepared as of such date in accordance with GAAP if
such lease were accounted for as a capital lease.

 

“Audited Financial Statements” means the audited consolidated balance sheet of
Borrower and its Subsidiaries for the fiscal year ended December 31, 2006, and
the related consolidated statements of income or operations, shareholders’
equity and cash flows for such fiscal year of Borrower and its Subsidiaries,
including the notes thereto.

 

“Availability Period” means the period from and including the Closing Date to
the earliest of (a) December 31, 2008, (b) the date of termination of the
Aggregate Commitments pursuant to Section 2.06, and (c) the date of termination
of the commitment of each Lender to make Loans pursuant to Section 8.02.

 

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

 

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

 

“Base Rate Loan” means a Loan that bears interest based on the Base Rate.

 

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“Bedford Facility” means Borrower’s facility in Bedford, Massachusetts located
at 32 Wiggins Avenue.

 

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

 

“Borrower Materials” has the meaning specified in Section 6.02.

 

“Borrowing” means a Revolving Credit Borrowing or a Term Borrowing, as the
context may require.

 

“Business Day” means any day other than a Saturday, Sunday or other day on which
commercial banks are authorized to close under the Laws of, or are in fact
closed in, the state where Administrative Agent’s Office is located and, if such
day relates to any Eurodollar Rate Loan, means any such day on which dealings in
Dollar deposits are conducted by and between banks in the London interbank
eurodollar market.

 

“Capital Expenditures” means, with respect to any Person for any period, any
expenditure in respect of the purchase or other acquisition of any fixed or
capital asset (excluding normal replacements and maintenance which are properly
charged to current operations).

 

“Cash Management Agreement” means any agreement to provide cash management
services, including treasury, depository, overdraft, credit or debit card,
electronic funds transfer and other cash management arrangements that is entered
into by and between any Loan Party and any Cash Management Bank.

 

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

 

“Change in Law” means the occurrence, after the date of this Agreement, of any
of the following: (a) the adoption or taking effect of any law, rule, regulation
or treaty, (b) any change in any law, rule, regulation or treaty or in the
administration, interpretation or application thereof by any Governmental
Authority or (c) the making or issuance of any request, guideline or directive
(whether or not having the force of law) by any Governmental Authority.

 

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

 

(a)           Borrower ceases to be a public company with a class of Equity
Interests that have been distributed by means of an effective registration
statement under the Securities Act of 1933 and which is subject to the reporting
requirements of the Securities Exchange Act of 1934;

 

(b)           the Equity Interests of Borrower cease to be listed on, or are
suspended from trading on, the NASDAQ Global Select Market or other U.S.
national securities exchange; or

 

(c)           Borrower shall cease to own, beneficially and of record, and
control 100% of the equity securities of Anika Securities or any other
Guarantor, or shall cease to have the power,

 

3

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directly or indirectly, to Control Anika Securities or any other Guarantor,
whether through the ability to exercise voting power, by contract or otherwise.

 

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

 

“Code” means the Internal Revenue Code of 1986.

 

“Commitment” means a Revolving Credit Commitment or a Term Commitment, as the
context may require.

 

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

 

“Compliance Certificate” means a certificate substantially in the form of
Exhibit D.

 

“Consolidated EBITDA” means, at any date of determination, an amount equal to
Consolidated Net Income of the Borrower and its Subsidiaries on a consolidated
basis for the most recently completed Measurement Period plus (a) the following
to the extent deducted in calculating such Consolidated Net Income: 
(i) Consolidated Interest Charges, (ii) the provision for Federal, state, local
and foreign income taxes payable, (iii) depreciation and amortization expense
and (iv) other non-recurring expenses reducing such Consolidated Net Income
which do not represent a cash item in such period or any future period (in each
case of or by the Borrower and its Subsidiaries for such Measurement Period) and
minus (b) the following to the extent included in calculating such Consolidated
Net Income:  all non-cash items increasing Consolidated Net Income (in each case
of or by the Borrower and its Subsidiaries for such Measurement Period). 
Milestone Payments received in cash will be included in the calculation of
Consolidated EBITDA in the year in which such Milestone Payments are received.

 

“Consolidated Fixed Charge Coverage Ratio” means, at any date of determination,
the ratio of:

 

(a)           (i) Consolidated EBITDA, plus (ii) non-cash stock compensation
expense, less (iii) the aggregate amount of all Unfinanced CapEx, less
(iv) income taxes paid in cash or accrued (net of any cash refund in respect of
income taxes received); to

 

(b)           the sum of (i) Consolidated Interest Charges, (ii) the aggregate
principal amount of all regularly scheduled principal payments or redemptions or
similar acquisitions for value of all Indebtedness (including the principal
component of capital lease obligations), (iii) rentals payable under leases of
personal property, including equipment (other than the principal component of
capital lease obligations included in clause (ii) of this paragraph), (iv) the
aggregate amount of all Restricted Payments and (v) the aggregate amount of
Federal, state, local and foreign income taxes paid in cash;

 

4

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in each case, of or by the Borrower and its Subsidiaries for the most recently
completed Measurement Period.

 

“Consolidated Interest Charges” means, for any Measurement Period, the sum of
(a) all interest, premium payments, debt discount, fees, charges and related
expenses in connection with borrowed money (including capitalized interest) or
in connection with the deferred purchase price of assets, in each case to the
extent treated as interest in accordance with GAAP, (b) all interest paid or
payable with respect to discontinued operations and (c) the portion of rent
expense under Capitalized Leases that is treated as interest in accordance with
GAAP, in each case, of or by the Borrower and its Subsidiaries on a consolidated
basis for the most recently completed Measurement Period.

 

“Consolidated Net Income” means, at any date of determination, the net income
(or loss) of the Borrower and its Subsidiaries on a consolidated basis for the
most recently completed Measurement Period; provided that Consolidated Net
Income shall exclude (a) extraordinary gains and extraordinary losses for such
Measurement Period, (b) the net income of any Subsidiary during such Measurement
Period to the extent that the declaration or payment of dividends or similar
distributions by such Subsidiary of such income is not permitted by operation of
the terms of its Organization Documents or any agreement, instrument or Law
applicable to such Subsidiary during such Measurement Period, except that the
Borrower’s equity in any net loss of any such Subsidiary for such Measurement
Period shall be included in determining Consolidated Net Income, and (c) any
income (or loss) for such Period of any Person if such Person is not a
Subsidiary, except that the Borrower’s equity in the net income of any such
Person for such Measurement Period shall be included in Consolidated Net Income
up to the aggregate amount of cash actually distributed by such Person during
such Measurement Period to the Borrower or a Subsidiary as a dividend or other
distribution (and in the case of a dividend or other distribution to a
Subsidiary, such Subsidiary is not precluded from further distributing such
amount to the Borrower as described in clause (b) of this proviso).

 

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

 

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

 

“Conversion Date” means December 31, 2008; provided, if such day is not a
Business Day, the Conversion Date shall be the immediately preceding Business
Day.

 

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

 

5

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

 

“Default Rate” means an interest rate equal to (i) the Base Rate plus (ii) the
Applicable Rate, if any, applicable to Base Rate Loans plus (iii) 2% per annum;
provided, however, that with respect to a Eurodollar Rate Loan, the Default Rate
shall be an interest rate equal to the interest rate (including any Applicable
Rate) otherwise applicable to such Loan plus 2% per annum.

 

“Defaulting Lender” means any Lender that (a) has failed to fund any portion of
the Loans required to be funded by it hereunder within one Business Day of the
date required to be funded by it hereunder unless such failure has been cured,
(b) has otherwise failed to pay over to Agent or any other Lender any other
amount required to be paid by it hereunder within one Business Day of the date
when due, unless the subject of a good faith dispute or unless such failure has
been cured, or (c) has been deemed insolvent or become the subject of a
bankruptcy or insolvency proceeding.

 

“Disposition” or “Dispose” means the sale, transfer, license, lease or other
disposition (including any sale and leaseback transaction) of any property by
any Person, including any sale, assignment, transfer or other disposal, with or
without recourse, of any notes or accounts receivable or any rights and claims
associated therewith.

 

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

 

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

 

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

 

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

 

“Equity Interests” means, with respect to any Person, all of the shares of
capital stock of (or other ownership or profit interests in) such Person, all of
the warrants, options or other rights for the purchase or acquisition from such
Person of shares of capital stock of (or other ownership

 

6

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

 

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

 

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

 

“ERISA Event” means (a) a Reportable Event with respect to a Pension Plan; (b) a
withdrawal by Borrower or any ERISA Affiliate from a Pension Plan subject to
Section 4063 of ERISA during a plan year in which it was a substantial employer
(as defined in Section 4001(a)(2) of ERISA) or a cessation of operations that is
treated as such a withdrawal under Section 4062(e) of ERISA; (c) a complete or
partial withdrawal by Borrower or any ERISA Affiliate from a Multiemployer Plan
or notification that a Multiemployer Plan is in reorganization; (d) the filing
of a notice of intent to terminate, the treatment of a Plan amendment as a
termination under Section 4041 or 4041A of ERISA, or the commencement of
proceedings by the PBGC to terminate a Pension Plan or Multiemployer Plan;
(e) an event or condition which constitutes grounds under Section 4042 of ERISA
for the termination of, or the appointment of a trustee to administer, any
Pension Plan or Multiemployer Plan; or (f) the imposition of any liability under
Title IV of ERISA, other than for PBGC premiums due but not delinquent under
Section 4007 of ERISA, upon Borrower or any ERISA Affiliate.

 

“Eurodollar Base Rate” has the meaning specified in the definition of Eurodollar
Rate.

 

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

 

Eurodollar Rate  =

Eurodollar Base Rate

1.00 – Eurodollar Reserve Percentage

 

Where,

 

“Eurodollar Base Rate” means, for such Interest Period the rate per annum equal
to the British Bankers Association LIBOR Rate (“BBA LIBOR”), as published by
Reuters (or other commercially available source providing quotations of BBA
LIBOR as designated by Agent from time to time) at approximately 11:00 a.m.,
London time, two Business Days prior to the commencement of such Interest
Period, for Dollar deposits (for delivery on the first day of such Interest
Period) with a term equivalent to such Interest Period.  If such rate is not
available at such time for any reason, then the “Eurodollar Base Rate” for such
Interest Period shall be the rate per annum determined by Agent to be the rate
at which deposits in Dollars for delivery on the first day of such

 

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Interest Period in same day funds in the approximate amount of the Eurodollar
Rate Loan being made, continued or converted by Bank of America and with a term
equivalent to such Interest Period would be offered by Bank of America’s London
Branch to major banks in the London interbank eurodollar market at their request
at approximately 11:00 a.m. (London time) two Business Days prior to the
commencement of such Interest Period.

 

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

 

“Eurodollar Rate Loan” means a Loan that bears interest at a rate based on the
Eurodollar Rate.

 

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

 

“Excluded Taxes” means, with respect to Agent, any Lender or any other recipient
of any payment to be made by or on account of any obligation of Borrower
hereunder, (a) taxes imposed on or measured by its overall net income (however
denominated), and franchise taxes imposed on it (in lieu of net income taxes),
by the jurisdiction (or any political subdivision thereof) under the laws of
which such recipient is organized or in which its principal office is located
or, in the case of any Lender, in which its applicable Lending Office is
located, and (b) any branch profits taxes imposed by the United States or any
similar tax imposed by any other jurisdiction in which Borrower is located.

 

“Facility” means the Term Facility or the Revolving Credit Facility, as the
context may require.

 

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

 

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

 

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

 

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

 

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

 

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

 

“Guaranteed Parties” means, collectively, the Administrative Agent, the Lenders,
the Hedge Banks, the Cash Management Banks, each co-agent or sub-agent appointed
by the Administrative Agent from time to time pursuant to Section 9.05, and the
other Persons the Obligations owing to which are or are purported to be
guaranteed by the Guaranty.

 

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“Guarantors” means, collectively, Anika Securities and each other Subsidiary of
the Borrower that shall be required to execute and deliver a guaranty, guaranty
supplement or pledge of its equity pursuant to Section 6.13.

 

“Guaranty” means the Guaranty made by the Guarantors under Article X in favor of
the Guaranteed Parties.

 

“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.

 

“Hedge Agreement” means any interest rate Swap Contract permitted under Articles
VI and VII that is entered into by and between any Loan Party and any Hedge
Bank.

 

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

 

“Indebtedness” means, as to any Person at a particular time, without
duplication, all of the following, whether or not included as indebtedness or
liabilities in accordance with GAAP:

 

(a)           all obligations of such Person for borrowed money and all
obligations of such Person evidenced by bonds, debentures, notes, loan
agreements or other similar instruments;

 

(b)           all direct or contingent obligations of such Person arising under
letters of credit (including standby and commercial), bankers’ acceptances, bank
guaranties, surety bonds and similar instruments;

 

(c)           net obligations of such Person under any Swap Contract;

 

(d)           all obligations of such Person to pay the deferred purchase price
of property or services (other than trade accounts payable in the ordinary
course of business and, in each case, not past due for more than 90 days);

 

(e)           indebtedness (excluding prepaid interest thereon) secured by a
Lien on property owned or being purchased by such Person (including indebtedness
arising under conditional sales or other title retention agreements), whether or
not such indebtedness shall have been assumed by such Person or is limited in
recourse;

 

(f)            all Attributable Indebtedness in respect of capital leases and
Synthetic Lease Obligations;

 

(g)           all obligations of such Person to purchase, redeem, retire,
defease or otherwise make any payment in respect of any Equity Interest in such
Person or any other Person, valued, in the case of a redeemable preferred
interest, at the greater of its voluntary or involuntary liquidation preference
plus accrued and unpaid dividends; and

 

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(h)           all Guarantees of such Person in respect of any of the foregoing.

 

For all purposes hereof, the Indebtedness of any Person shall include the
Indebtedness of any partnership or joint venture (other than a joint venture
that is itself a corporation or limited liability company) in which such Person
is a general partner or a joint venturer, unless such Indebtedness is expressly
made non-recourse to such Person.  The amount of any net obligation under any
Swap Contract on any date shall be deemed to be the Swap Termination Value
thereof as of such date.

 

“Indemnified Taxes” means Taxes other than Excluded Taxes.

 

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

 

“Information” has the meaning specified in Section 11.07.

 

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

 

“Interest Period” means, as to each Eurodollar Rate Loan, the period commencing
on the date such Eurodollar Rate Loan is disbursed or converted to or continued
as a Eurodollar Rate Loan and ending on the date one, two, three or six months
thereafter, as selected by Borrower in its Committed Loan Notice; provided that:

 

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

 

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

 

(iii)          no Interest Period shall extend beyond the Maturity Date of the
Facility under which such Loan was made.

 

“Investment” means, as to any Person, any direct or indirect acquisition or
investment by such Person, whether by means of (a) the purchase or other
acquisition of capital stock or other securities of another Person, (b) a loan,
advance or capital contribution to, Guarantee or assumption of debt of, or
purchase or other acquisition of any other debt or equity participation or
interest in, another Person, including any partnership or joint venture interest
in such other Person and any arrangement pursuant to which the investor
Guarantees Indebtedness of such

 

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other Person, or (c) the purchase or other acquisition (in one transaction or a
series of transactions) of assets of another Person that constitute a business
unit.  For purposes of covenant compliance, the amount of any Investment shall
be the amount actually invested, without adjustment for subsequent increases or
decreases in the value of such Investment.

 

“IRS” means the United States Internal Revenue Service.

 

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

 

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

 

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

 

“Lien” means any mortgage, pledge, hypothecation, assignment, deposit
arrangement, encumbrance, lien (statutory or other), charge, or preference,
priority or other security interest or preferential arrangement in the nature of
a security interest of any kind or nature whatsoever (including any conditional
sale or other title retention agreement, any easement, right of way or other
encumbrance on title to real property, and any financing lease having
substantially the same economic effect as any of the foregoing).

 

“Loan” means an extension of credit by a Lender to Borrower under Article II in
the form of a Revolving Credit Loan or a Term Loan.

 

“Loan Documents” means, collectively, (a) this Agreement, (b) the Notes,
(c) each Hedge Agreement, (d) each Cash Management Agreement and (e) each
agreement executed and delivered to Agent pursuant to Section 6.13; provided
that for purposes of the definition of “Material Adverse Effect” and Articles IV
through IX, “Loan Documents” shall not include Hedge Agreements or Cash
Management Agreements.

 

“Loan Parties” means, collectively, the Borrower and the Guarantors.

 

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

 

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“Material Contract” means, with respect to any Loan Party, each contract to
which such Person is a party involving aggregate consideration payable to or by
such Loan Party of an amount in excess of 20% of Borrower’s consolidated
revenues for its most recently completed fiscal year.

 

“Maturity Date” means (a) with respect to the Revolving Credit Facility, the
last day of the Availability Period and (b) with respect to the Term Facility,
December 31, 2015; provided, that if such date is not a Business Day, the
Maturity Date shall be the immediately succeeding Business Day.

 

“Measurement Period” means, at any date of determination, the most recently
completed four fiscal quarters of the Borrower.

 

“Milestone Payments” means payments received by a Loan Party under a long-term
customer contract for the achievement by such Loan Party of a specified event
and for which the revenue recognition treatment differs under GAAP and the Code.

 

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

 

“Negotiation Period” has the meaning set forth in Section 3.03.

 

“Note” means a Revolving Credit Note or a Term Note, as the context may require.

 

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

 

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

 

“Other Taxes” means all present or future stamp, intangible or documentary taxes
or any other excise or property taxes, charges or similar levies arising from
any payment made

 

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hereunder or under any other Loan Document or from the execution, delivery or
enforcement of, or otherwise with respect to, this Agreement or any other Loan
Document.

 

“Outstanding Amount” means with respect to Term Loans and Revolving Credit Loans
on any date, the aggregate outstanding principal amount thereof after giving
effect to any borrowings and prepayments or repayments of Term Loans and
Revolving Credit Loans, as the case may be, occurring on such date.

 

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

 

“PBGC” means the Pension Benefit Guaranty Corporation.

 

“Pension Plan” means any “employee pension benefit plan” (as such term is
defined in Section 3(2) of ERISA), other than a Multiemployer Plan, that is
subject to Title IV of ERISA and is sponsored or maintained by Borrower or any
ERISA Affiliate or to which Borrower or any ERISA Affiliate contributes or has
an obligation to contribute, or in the case of a multiple employer or other plan
described in Section 4064(a) of ERISA, has made contributions at any time during
the immediately preceding five plan years.

 

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

 

“Plan” means any “employee benefit plan” (as such term is defined in
Section 3(3) of ERISA) established by Borrower or, with respect to any such plan
that is subject to Section 412 of the Code or Title IV of ERISA, any ERISA
Affiliate.

 

“Platform” has the meaning specified in Section 6.02.

 

“Principal Payment Date” means the last Business Day of each March, June,
September and December, commencing with March 2009, and including the Maturity
Date.

 

“Public Lender” has the meaning specified in Section 6.02.

 

“Quick Assets” means cash, short-term cash investments, net trade receivables
and marketable securities not classified as long-term investments.

 

“Rate Determination Notice” has the meaning set forth in Section 3.03.

 

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

 

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

 

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

 

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“Required Lenders” means, as of any date of determination, Lenders holding in
the aggregate at least 66 2/3 % of the sum of the (a) Total Outstandings and
(b) aggregate unused Revolving Credit Commitments; provided that the Commitment
of, and the portion of the Total Outstandings held or deemed held by, any
Defaulting Lender shall be excluded for purposes of making a determination of
Required Lenders.

 

“Responsible Officer” means the chief executive officer, president, chief
financial officer, treasurer, assistant treasurer or controller of a Loan Party
and, solely for purposes of notices given pursuant to Article II, any other
officer or employee of the applicable Loan Party so designated by any of the
foregoing officers in a notice to Agent.    Any document delivered hereunder
that is signed by a Responsible Officer of a Loan Party shall be conclusively
presumed to have been authorized by all necessary corporate, partnership and/or
other action on the part of such Loan Party and such Responsible Officer shall
be conclusively presumed to have acted on behalf of such Loan Party.

 

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

 

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

 

“Revolving Credit Commitment” means, as to each Lender, its obligation to make
Revolving Credit Loans to the Borrower pursuant to Section 2.01 in an aggregate
principal amount at any one time outstanding not to exceed the amount set forth
opposite such Lender’s name on Schedule 2.01 under the caption “Revolving Credit
Commitment” or opposite such caption in the Assignment and Assumption pursuant
to which such Lender becomes a party hereto, as applicable, as such amount may
be adjusted from time to time in accordance with this Agreement.  The aggregate
amount of the Revolving Credit Commitments of the Lenders as of the Closing Date
is $16,000,000.

 

“Revolving Credit Facility” means, at any time, the aggregate amount of the
Lenders’ Revolving Credit Commitments at such time.

 

“Revolving Credit Loan” has the meaning specified in Section 2.01.

 

“Revolving Credit Note” means a promissory note made by the Borrower in favor of
a Lender evidencing Revolving Credit Loans made by such Lender, substantially in
the form of Exhibit C-1.

 

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

 

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“Subordinated Liabilities” means liabilities subordinated to the Obligations in
a manner acceptable to Agent in its sole discretion.

 

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

 

“Substitute Basis” has the meaning set forth in Section 3.03.

 

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

 

“Swap Termination Value” means, in respect of any one or more Swap Contracts,
after taking into account the effect of any legally enforceable netting
agreement relating to such Swap Contracts, (a) for any date on or after the date
such Swap Contracts have been closed out and termination value(s) determined in
accordance therewith, such termination value(s), and (b) for any date prior to
the date referenced in clause (a), the amount(s) determined as the
mark-to-market value(s) for such Swap Contracts, as determined based upon one or
more mid-market or other readily available quotations provided by any recognized
dealer in such Swap Contracts (which may include a Lender or any Affiliate of a
Lender).

 

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

 

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

 

“Term Borrowing” means a Term-Out of Revolving Credit Loans into Term Loans of
the same Type on the same date and, in the case of Eurodollar Rate Loans, having
the same Interest Period effected by each of the Lenders pursuant to
Section 2.03.

 

“Term Commitment” means, as to each Lender, its obligation to Term-Out its
Revolving Credit Loans into Term Loans pursuant to Section 2.03 in an aggregate
principal amount at any one time outstanding not to exceed the amount set forth
opposite such Lender’s name on Schedule 2.01 under the caption “Term Commitment”
or opposite such caption in the Assignment and Assumption pursuant to which such
Lender becomes a party hereto, as applicable, as such amount may be adjusted
from time to time in accordance with this Agreement.  The aggregate amount of
the Term Commitments of the Lenders as of the Closing Date is $16,000,000.

 

“Term Facility” means, at any time, (a) at any time during the Availability
Period, the sum of (i) the aggregate amount of the Term Commitments at such time
and (ii) the aggregate principal amount of the Term Loans of all Lenders
outstanding at such time and (b) thereafter, the Outstanding Amount of all Term
Loans of all Lenders at such time.

 

“Term Loan” has the meaning set forth in Section 2.03.

 

“Term Note” means a promissory note made by the Borrower in favor of a Lender
evidencing Term Loans made by such Term Lender, substantially in the form of
Exhibit C-2.

 

“Term-Out” means, with respect to any Revolving Credit Loan, the conversion and
continuation of such Revolving Credit Loan as a Term Loan in accordance with
Section 2.03.  The term “Term-Out” used as a verb shall have a correlative
meaning.

 

“Threshold Amount” means $1,000,000.

 

“Total Current Liabilities” means, as at any date of determination, the sum, for
Borrower and its Subsidiaries (determined on a consolidated basis without
duplication in accordance with GAAP), of all current liabilities that should, in
accordance with GAAP, be classified as current liabilities on the consolidated
balance sheet of Borrower and its Subsidiaries as at such date.

 

“Total Revolving Credit Outstandings” means the aggregate Outstanding Amount of
all Revolving Credit Loans.

 

 “Total Outstandings” means the aggregate Outstanding Amount of all Loans.

 

“Type” means, with respect to a Loan, its character as a Base Rate Loan or a
Eurodollar Rate Loan.

 

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“Unfinanced CapEx” means, for any period, Capital Expenditures for such period
paid in cash excluding (a) Capital Expenditures paid with proceeds of
Indebtedness for money borrowed (except for the Loans) incurred to finance such
Capital Expenditures, (b) Capital Expenditures financed by Indebtedness of the
kind referred to in clause (f) of the definition of “Indebtedness” with respect
to capital leases and (c) Capital Expenditures for the Bedford Facility.

 

“Unfunded Pension Liability” means the excess of a Pension Plan’s benefit
liabilities under Section 4001(a)(16) of ERISA, over the current value of that
Pension Plan’s assets, determined in accordance with the assumptions used for
funding the Pension Plan pursuant to Section 412 of the Code for the applicable
plan year.

 

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

 

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

 

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

 

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

 

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

 

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1.03         Accounting Terms.

 

(a)           Generally. All accounting terms not specifically or completely
defined herein shall be construed in conformity with, and all financial data
(including financial ratios and other financial calculations) required to be
submitted pursuant to this Agreement shall be prepared in conformity with, GAAP
applied on a consistent basis, as in effect from time to time, applied in a
manner consistent with that used in preparing the Audited Financial Statements,
except as otherwise specifically prescribed herein.

 

(b)           Changes in GAAP.  If at any time any change in GAAP would affect
the computation of any financial ratio or requirement set forth in any Loan
Document, and either Borrower or the Required Lenders shall so request, Agent,
Lenders and Borrower shall negotiate in good faith to amend such ratio or
requirement to preserve the original intent thereof in light of such change in
GAAP (subject to the approval of the Required Lenders); provided that, until so
amended, (i) such ratio or requirement shall continue to be computed in
accordance with GAAP prior to such change therein and (ii) Borrower shall
provide to Agent and Lenders financial statements and other documents required
under this Agreement or as reasonably requested hereunder setting forth a
reconciliation between calculations of such ratio or requirement made before and
after giving effect to such change in GAAP.

 

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

 

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

 

ARTICLE II. THE COMMITMENTS AND BORROWINGS

 

2.01         Revolving Credit Borrowings.  Subject to the terms and conditions
set forth herein, each Lender severally agrees to make loans (each such loan, a
“Revolving Credit Loan”) to Borrower from time to time, on any Business Day
during the Availability Period, in an aggregate amount not to exceed at any time
outstanding the amount of such Lender’s Revolving Credit Commitment; provided,
however, that after giving effect to any Revolving Credit Borrowing, (i) the
Total Revolving Credit Outstandings shall not exceed the Revolving Credit
Facility, (ii) the aggregate Outstanding Amount of the Revolving Credit Loans of
any Lender shall not exceed such Lender’s Revolving Credit Commitment and
(iii) the aggregate Outstanding Amount of all Loans of any Lender shall not
exceed such Lender’s Term Commitment.  Within the limits of each Lender’s
Revolving Credit Commitment, and subject to the other terms and conditions
hereof, Borrower may borrow and reborrow during the Availability Period under
this Section 2.01, and prepay under Section 2.05.  Revolving Credit Loans may be
Base Rate Loans or Eurodollar Rate Loans, as further provided herein.

 

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2.02         Borrowings, Conversions and Continuations of Loans.

 

(a)           Each Borrowing (including for avoidance of doubt each Term-Out of
a Revolving Credit Borrowing), each conversion of Loans from one Type to the
other, and each continuation of Eurodollar Rate Loans shall be made upon
Borrower’s irrevocable notice to Agent, which may be given by telephone.  Each
such notice must be received by Agent not later than 11:00 a.m. (i) two Business
Days prior to the requested date of any Borrowing of, conversion to or
continuation of Eurodollar Rate Loans or of any conversion of Eurodollar Rate
Loans to Base Rate Loans, and (ii) on the requested date of any Borrowing of
Base Rate Loans.  Each telephonic notice by Borrower pursuant to this
Section 2.02(a) must be confirmed promptly by delivery to Agent of a written
Committed Loan Notice, appropriately completed and signed by a Responsible
Officer of Borrower.  Each Borrowing of, conversion to or continuation of
Eurodollar Rate Loans shall be in a principal amount of $100,000 or a whole
multiple of $100,000 in excess thereof.  Each Borrowing of or conversion to Base
Rate Loans shall be in a principal amount of $100,000 or a whole multiple of
$100,000 in excess thereof.  Each Committed Loan Notice (whether telephonic or
written) shall specify (i) whether Borrower is requesting a Revolving Credit
Borrowing, a Term Borrowing, a conversion of Loans from one Type to the other,
or a continuation of Eurodollar Rate Loans, (ii) the requested date of the
Borrowing, conversion or continuation, as the case may be (which shall be a
Business Day), (iii) the principal amount of Loans to be borrowed, converted or
continued, (iv) the Type of Loans to be borrowed or to which existing Revolving
Credit Loans or Term Loans are to be converted, and (v) if applicable, the
duration of the Interest Period with respect thereto.  If Borrower fails to
specify a Type of Loan in a Committed Loan Notice or if Borrower fails to give a
timely notice requesting a conversion or continuation, then the applicable Loans
shall be made as, or converted to, Base Rate Loans.  Any such automatic
conversion to Base Rate Loans shall be effective as of the last day of the
Interest Period then in effect with respect to the applicable Eurodollar Rate
Loans.  If Borrower requests a Borrowing of, conversion to, or continuation of
Eurodollar Rate Loans in any such Committed Loan Notice, but fails to specify an
Interest Period, it will be deemed to have specified an Interest Period of one
month.

 

(b)           Following receipt of a Committed Loan Notice, Agent shall promptly
notify each Lender of the amount of its Applicable Percentage under the
applicable Facility of the applicable Term Loans or Revolving Credit Loans, and
if no timely notice of a conversion or continuation is provided by Borrower,
Agent shall notify each Lender of the details of any automatic conversion to
Base Rate Loans described in the preceding subsection.  In the case of a
Revolving Credit Borrowing, each Lender shall make the amount of its Loan
available to Agent in immediately available funds at Administrative Agent’s
Office not later than 1:00 p.m. on the Business Day specified in the applicable
Committed Loan Notice.  Upon satisfaction of the applicable conditions set forth
in Section 4.02 (and, if such Borrowing is the initial Borrowing, Section 4.01),
Agent shall make all funds so received available to Borrower in like funds as
received by Agent either by (i) crediting the account of Borrower on the books
of Bank of America with the amount of such funds or (ii) wire transfer of such
funds, in each case in accordance with instructions provided to (and reasonably
acceptable to) Agent by Borrower.

 

(c)           Except as otherwise provided herein, a Eurodollar Rate Loan may be
continued or converted only on the last day of an Interest Period for such
Eurodollar Rate Loan. 

 

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During the existence of a Default, no Loans may be requested as, converted to or
continued as Eurodollar Rate Loans without the consent of the Required Lenders,
and the Required Lenders may demand that any or all of the then outstanding
Eurodollar Rate Loans be converted immediately to Base Rate Loans and Borrower
agrees to pay all amounts due under Section 3.05 in accordance with the terms
thereof due to any such conversion.

 

(d)           Agent shall promptly notify Borrower and Lenders of the interest
rate applicable to any Interest Period for Eurodollar Rate Loans upon
determination of such interest rate.

 

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

 

2.03         Term Borrowings.  Each Lender severally agrees, on the terms and
conditions of this Agreement, (i) during the Availability Period and at
Borrower’s request in accordance with Section 2.02, to Term-Out all or any
portion of its outstanding Revolving Credit Loans so requested by Borrower
(provided that any such requested portion shall be in a principal amount of
$100,000 or a whole multiple of $100,000 in excess thereof), and to make a term
loan to the Borrower on the requested Term-Out date in an amount equal to such
requested principal amount of such Lender’s outstanding Revolving Credit Loans,
and (ii) to Term-Out its Revolving Credit Loans outstanding on the Conversion
Date, and to make a term loan (such Termed-Out Revolving Credit Loans and such
term loans made pursuant to clauses (i) and (ii) of this Section 2.03, the “Term
Loans”) to the Borrower on the Conversion Date in an amount equal to the
aggregate principal amount of such Lender’s Revolving Credit Loans outstanding
on the Conversion Date; provided, however, that after giving effect to any Term
Borrowing, the aggregate Outstanding Amount of the Term Loans of any Lender
shall not exceed such Lender’s Term Commitment.  Each Term-Out of Revolving
Credit Loans shall be deemed to be a Borrowing for all purposes of this
Agreement; provided, that Revolving Credit Loans that are Termed-Out by Term
Loans shall not be deemed to be repaid or discharged but shall be deemed to be
continued as Term Loans as provided hereby.  Amounts Termed-Out, prepaid or
repaid in respect of Term Loans may not be reborrowed.  Term Loans may be Base
Rate Loans or Eurodollar Rate Loans, as provided herein.

 

2.04         [Reserved]

 

2.05         Prepayments.

 

(a)           Optional.  Borrower may, upon notice to Agent, at any time or from
time to time voluntarily prepay Loans in whole or in part without premium or
penalty; provided that (i) such notice must be received by Agent not later than
11:00 a.m. (A) three Business Days prior to any date of prepayment of Eurodollar
Rate Loans and (B) on the date of prepayment of Base Rate Loans; (ii) any
prepayment of Eurodollar Rate Loans shall be in a principal amount of $100,000
or a whole multiple of $100,000 in excess thereof; and (iii) any prepayment of
Base Rate Loans shall be in a principal amount of $100,000 or a whole multiple
of $100,000 in excess thereof or, in each case, if less, the entire principal
amount thereof then outstanding.  Each such

 

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notice shall specify the date and amount of such prepayment and the Type(s) of
Loans to be prepaid and, if Eurodollar Rate Loans are to be prepaid, the
Interest Period(s) of such Loans.  Agent will promptly notify each Lender of its
receipt of each such notice, and of the amount of such Lender’s Applicable
Percentage of such prepayment.  If such notice is given by Borrower, Borrower
shall make such prepayment and the payment amount specified in such notice shall
be due and payable on the date specified therein.  Any prepayment of a
Eurodollar Rate Loan shall be accompanied by all accrued interest on the amount
prepaid, together with any additional amounts required pursuant to
Section 3.05.  Each prepayment of the outstanding Term Loans pursuant to this
Section 2.05(a) shall be applied to the principal repayment installments thereof
in inverse order of maturity, and each such prepayment shall be paid to the
Lenders in accordance with their respective Applicable Percentages in respect of
each of the relevant Facilities.

 

(b)           Mandatory.  If for any reason the Total Revolving Credit
Outstandings at any time exceed the Revolving Credit Facility at such time,
Borrower shall immediately prepay Revolving Credit Loans in an aggregate amount
equal to such excess.

 

2.06         Termination or Reduction of Commitments.  Borrower may, upon notice
to Agent, terminate the Revolving Credit Facility, or from time to time
permanently reduce the Revolving Credit Facility; provided that (i) any such
notice shall be received by Agent not later than 11:00 a.m. five Business Days
prior to the date of termination or reduction, (ii) any such partial reduction
shall be in an aggregate amount of $1,000,000 or any whole multiple of
$1,000,000 in excess thereof, and (iii) Borrower shall not terminate or reduce
the Revolving Credit Facility if, after giving effect thereto and to any
concurrent prepayments hereunder, the Total Revolving Credit Outstandings would
exceed the Revolving Credit Facility.  Upon any such termination or reduction of
the Revolving Credit Facility during the Availability Period, the Term
Commitments shall also be automatically terminated or reduced by an equal
aggregate amount.  Agent will promptly notify the Lenders of any such notice of
termination or reduction of the Facilities.  Any reduction of the Aggregate
Commitments shall be applied to the Commitments of each Lender according to its
Applicable Percentage.  All fees accrued until the effective date of any
termination of the Aggregate Commitments shall be paid on the effective date of
such termination.

 

2.07         Repayment of Loans.

 

(a)           Revolving Credit Loans.  Borrower hereby unconditionally promises
to pay to the Administrative Agent for account of the Lenders on the Maturity
Date for the Revolving Credit Facility the aggregate principal amount of all
Revolving Credit Loans outstanding on such date which have not been Termed-Out
pursuant to Section 2.03.

 

(b)           Term Loans.  Borrower hereby unconditionally promises to pay to
the Administrative Agent for account of the Lenders the outstanding principal
amount of all Term Loans in twenty-eight (28) equal, consecutive quarterly
installments, calculated based on a ten-year straight-line amortization for a
seven-year term, one installment payable on each Principal Payment Date;
provided, that (i) the final installment shall be in an amount equal to the then
aggregate unpaid principal amount of all Term Loans and (ii) the installments
shall be reduced as

 

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a result of the application of prepayments in accordance with the order of
priority set forth in Section 2.05.  By way of illustration, if the aggregate
Outstanding Amount of all Term Loans is $16,000,000 as of the Conversion Date,
then the amount of each quarterly installment would be $400,000, with the final
installment equal to $5,200,000.

 

2.08         Interest.

 

(a)           Subject to the provisions of subsection (b) below, (i) each
Eurodollar Rate Loan shall bear interest on the outstanding principal amount
thereof for each Interest Period at a rate per annum equal to the Eurodollar
Rate for such Interest Period plus the Applicable Rate; and (ii) each Base Rate
Loan shall bear interest on the outstanding principal amount thereof from the
applicable borrowing date at a rate per annum equal to the Base Rate plus the
Applicable Rate.

 

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

 

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

 

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

 

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

 

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

 

2.09         Fees.

 

(a)           Commitment Fee.  Borrower shall pay to Agent for the account of
each Lender in accordance with its Applicable Percentage, a commitment fee equal
to the Applicable Rate times the actual daily amount by which the Aggregate
Commitments exceed the Outstanding Amount of Loans.  The commitment fee shall
accrue at all times during the Availability Period, including at any time during
which one or more of the conditions in Article IV

 

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is not met, and shall be due and payable quarterly in arrears on the last
Business Day of each March, June, September and December, commencing with the
first such date to occur after the Closing Date, and on the last day of the
Availability Period.  The commitment fee shall be calculated quarterly in
arrears, and if there is any change in the Applicable Rate during any quarter,
the actual daily amount shall be computed and multiplied by the Applicable Rate
separately for each period during such quarter that such Applicable Rate was in
effect.

 

(b)           Lenders’ Upfront Fee.  On the Closing Date, Borrower shall pay to
Agent, for the account of each Lender in accordance with their respective
Applicable Percentages, an upfront fee in an amount of $50,000.  Such upfront
fees are for the credit facilities committed by Lenders under this Agreement and
are fully earned on the date paid.  The upfront fee paid to each Lender is
solely for its own account and is nonrefundable for any reason whatsoever.

 

2.10         Computation of Interest and Fees.  All computations of interest for
Base Rate Loans when the Base Rate is determined by Bank of America’s “prime
rate” shall be made on the basis of a year of 365 or 366 days, as the case may
be, and actual days elapsed.  All other computations of fees and interest shall
be made on the basis of a 360-day year and actual days elapsed (which results in
more fees or interest, as applicable, being paid than if computed on the basis
of a 365-day year).  Interest shall accrue on each Loan for the day on which the
Loan is made, and shall not accrue on a Loan, or any portion thereof, for the
day on which the Loan or such portion is paid, provided that any Loan that is
repaid on the same day on which it is made shall, subject to Section 2.12(a),
bear interest for one day.  Each determination by Agent of an interest rate or
fee hereunder shall be conclusive and binding for all purposes, absent manifest
error.

 

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

 

2.12         Payments Generally; Agent’s Clawback.

 

(a)           General.

 

(i)            All payments to be made by Borrower shall be made without
condition or deduction for any counterclaim, defense, recoupment or setoff. 
Except as otherwise

 

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expressly provided herein, all payments by Borrower hereunder shall be made to
Agent, for the account of the respective Lenders to which such payment is owed,
at the Administrative Agent’s Office in Dollars and in immediately available
funds not later than 12:00 noon on the date specified herein.  Agent will
promptly distribute to each Lender its Applicable Percentage (or other
applicable share as provided herein) of such payment in like funds as received
by wire transfer to such Lender’s Lending Office.  All payments received by
Agent after 12:00 noon shall be deemed received on the next succeeding Business
Day and any applicable interest or fee shall continue to accrue.  If any payment
to be made by Borrower shall come due on a day other than a Business Day,
payment shall be made on the next following Business Day, and such extension of
time shall be reflected in computing interest or fees, as the case may be.

 

(ii)           On each date when the payment of any principal, interest or fees
are due hereunder or under any Note, Borrower agrees to maintain on deposit in
an ordinary checking account maintained by Borrower with Agent (as such account
shall be designated by Borrower in a written notice to Agent from time to time,
the “Borrower Account”) an amount sufficient to pay such principal, interest or
fees in full on such date.  Borrower hereby authorizes Agent (A) to deduct
automatically all principal, interest or fees when due hereunder or under any
Note from the Borrower Account, and (B) if and to the extent any payment of
principal, interest or fees under this Agreement or any Note is not made when
due to deduct any such amount from any or all of the accounts of Borrower
maintained at Agent.  Agent agrees to provide written notice to Borrower of any
automatic deduction made pursuant to this Section 2.12(a)(ii) showing in
reasonable detail the amounts of such deduction.  Lenders agree to reimburse
Borrower based on their Applicable Percentage for any amounts deducted from such
accounts in excess of amount due hereunder and under any other Loan Documents.

 

(b)           (i)  Funding by Lenders; Presumption by Agent.  Unless Agent shall
have received notice from a Lender prior to the proposed date of any Borrowing
of Eurodollar Rate Loans (or, in the case of any Borrowing of Base Rate Loans,
prior to 12:00 noon on the date of such Borrowing) that such Lender will not
make available to Agent such Lender’s share of such Borrowing, Agent may assume
that such Lender has made such share available on such date in accordance with
Section 2.02 (or, in the case of a Borrowing of Base Rate Loans, that such
Lender has made such share available in accordance with and at the time required
by Section 2.02) and may, in reliance upon such assumption, make available to
Borrower a corresponding amount.  In such event, if a Lender has not in fact
made its share of the applicable Borrowing available to Agent, then the
applicable Lender and Borrower severally agree to pay to Agent forthwith on
demand such corresponding amount in immediately available funds with interest
thereon, for each day from and including the date such amount is made available
to Borrower to but excluding the date of payment to Agent, at (A) in the case of
a payment to be made by such Lender, the greater of the Federal Funds Rate and a
rate determined by Agent in accordance with banking industry rules on interbank
compensation, plus any administrative, processing or similar fees customarily
charged by Agent in connection with the foregoing and (B) in the case of a
payment to be made by Borrower, the interest rate applicable to Base Rate
Loans.  If Borrower and such Lender shall pay such interest to Agent for the
same or an overlapping period, Agent shall promptly remit to Borrower the amount
of such interest paid by Borrower for such period.  If such Lender pays its
share of the applicable Borrowing to Agent, then the amount so paid shall
constitute such Lender’s Loan included in such Borrowing.  Any payment by
Borrower shall be

 

25

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without prejudice to any claim Borrower may have against a Lender that shall
have failed to make such payment to Agent.

 

(ii)           Payments by Borrower; Presumptions by Agent.  Unless Agent shall
have received notice from Borrower prior to the date on which any payment is due
to Agent for the account of the Lenders hereunder that Borrower will not make
such payment, Agent may assume that Borrower has made such payment on such date
in accordance herewith and may, in reliance upon such assumption, distribute to
Lenders the amount due.  In such event, if Borrower has not in fact made such
payment, then each of Lenders severally agrees to repay to Agent forthwith on
demand the amount so distributed to such Lender in immediately available funds
with interest thereon, for each day from and including the date such amount is
distributed to it to but excluding the date of payment to Agent, at the greater
of the Federal Funds Rate and a rate determined by Agent in accordance with
banking industry rules on interbank compensation.  A notice of Agent to any
Lender or Borrower with respect to any amount owing under this subsection
(b) shall be conclusive, absent manifest error.

 

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

 

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

 

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

 

2.13         Sharing of Payments.  If any Lender shall, by exercising any right
of setoff or counterclaim or otherwise, obtain payment in respect of any
principal of or interest on any of the Loans made by it resulting in such
Lender’s receiving payment of a proportion of the aggregate amount of such Loans
and accrued interest thereon greater than its pro rata share thereof as provided
herein, then the Lender receiving such greater proportion shall (a) notify Agent
of such fact, and (b) purchase (for cash at face value) participations in the
Loans of the other Lenders, or make such other adjustments as shall be
equitable, so that the benefit of all such payments shall be shared by the
Lenders ratably in accordance with the aggregate amount of principal of and
accrued interest on their respective Loans and other amounts owing them,
provided that:

 

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(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 Section shall not be construed to apply to
(x) any payment made by Borrower pursuant to and in accordance with the express
terms of this Agreement or (y) any payment obtained by a Lender as consideration
for the assignment of or sale of a participation in any of its Loans to any
assignee or participant, other than to Borrower or any Subsidiary thereof (as to
which the provisions of this Section shall apply).

 

Each Loan Party 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
Loan Party rights of setoff and counterclaim with respect to such participation
as fully as if such Lender were a direct creditor of such Loan Party in the
amount of such participation.

 

ARTICLE III.        TAXES, YIELD PROTECTION AND ILLEGALITY

 

3.01         Taxes.

 

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

 

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

 

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

 

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(d)           Evidence of Payments.  As soon as practicable after any payment of
Indemnified Taxes or Other Taxes by Borrower to a Governmental Authority,
Borrower shall deliver to 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 Agent.

 

(e)           Status of Lenders.  Any Lender, if requested by Borrower or Agent,
shall deliver such documentation prescribed by applicable law or reasonably
requested by Borrower or Agent as will enable Borrower or Agent to determine
whether or not such Lender is subject to backup withholding or information
reporting requirements.

 

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

 

3.02         Illegality.  If any Lender determines that any Law has made it
unlawful, or that any Governmental Authority has asserted that it is unlawful,
for any Lender or its applicable Lending Office to make, maintain or fund
Eurodollar Rate Loans, or to determine or charge interest rates based upon the
Eurodollar Rate, or any Governmental Authority has imposed material restrictions
on the authority of such Lender to purchase or sell, or to take deposits of,
Dollars in the London interbank market, then, on notice thereof by such Lender
to Borrower through Agent, any obligation of such Lender to make or continue
Eurodollar Rate Loans or to convert Base Rate Loans to Eurodollar Rate Loans
shall be suspended until such Lender notifies Agent and Borrower that the
circumstances giving rise to such determination no longer exist.  Upon receipt
of such notice, Borrower shall, upon demand from such Lender (with a copy to
Agent), prepay or, if applicable, convert all Eurodollar Rate Loans of such
Lender to Base Rate Loans, either on the last day of the Interest Period
therefor, if such Lender may lawfully continue to maintain such Eurodollar Rate
Loans to such day, or immediately, if such Lender may not lawfully continue to
maintain such Eurodollar Rate Loans.  Upon any such prepayment or conversion,
Borrower shall also pay accrued interest on the amount so prepaid or converted
and all amounts due under Section 3.05 in accordance with the terms thereof due
to such prepayment or conversion.

 

3.03         Inability to Determine Rates.  If Agent determines in connection
with any request for a Eurodollar Rate Loan or a conversion to or continuation
thereof that (a) Dollar deposits are

 

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not being offered to banks in the London interbank eurodollar market for the
applicable amount and Interest Period of such Eurodollar Rate Loan, (b) adequate
and reasonable means do not exist for determining the Eurodollar Base Rate for
any requested Interest Period with respect to a proposed Eurodollar Rate Loan,
or (c) the Eurodollar Base Rate for any requested Interest Period with respect
to a proposed Eurodollar Rate Loan does not adequately and fairly reflect the
cost to such Lenders of funding such Loan, Agent will promptly so notify (such
notice, a “Rate Determination Notice”) Borrower and each Lender.  Thereafter,
the obligation of Lenders to make or maintain Eurodollar Rate Loans shall be
suspended until Agent (upon the instruction of the Required Lenders) revokes
such notice.  If such notice is given, during the 30-day period following such
Rate Determination Notice (the “Negotiation Period”), Agent and Borrower will
negotiate in good faith with a view to agreeing upon a substitute interest rate
basis (having the written approval of the Required Lenders) for the Interest
Period(s) to which such Rate Determination Notice relates which shall reflect
the cost to the Lenders of funding such Loans from alternative sources (a
“Substitute Basis”), and if such Substitute Basis is so agreed upon during the
Negotiation Period, such Substitute Basis shall apply in lieu of the Eurodollar
Rate to the Interest Period(s) to which such Rate Determination Notice relates,
until the circumstances giving rise to such notice have ceased to apply.  If a
Substitute Basis is not agreed upon during the Negotiation Period, Borrower may
elect to prepay the affected Loans pursuant to Section 2.05(a); provided, that
if Borrower does not elect to so prepay, then (i) the affected Loans shall bear
interest at a rate per annum equal to the Base Rate plus the Applicable Rate
from and after the first day of the affected Interest Period to which such Rate
Determination Notice relates, payable in accordance with Section 2.08, and
(ii) Borrower may revoke any pending request for a Borrowing of, conversion to
or continuation of Eurodollar Rate Loans or, failing that, Borrower will be
deemed to have converted such request into a request for a Borrowing of Base
Rate Loans in the amount specified therein.

 

3.04         Increased Costs.

 

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

 

(i)            impose, modify or deem applicable any reserve, special deposit,
compulsory loan, insurance charge or similar requirement against assets of,
deposits with or for the account of, or credit extended or participated in by,
any Lender (except any reserve requirement reflected in the Eurodollar Rate);

 

(ii)           subject any Lender to any tax of any kind whatsoever with respect
to this Agreement or any Eurodollar Rate Loan made by it, or change the basis of
taxation of payments to such Lender in respect thereof (except for Indemnified
Taxes or Other Taxes covered by Section 3.01 and the imposition of, or any
change in the rate of, any Excluded Tax payable by such Lender); or

 

(iii)          impose on any Lender or the London interbank market any other
condition, cost or expense affecting this Agreement or Eurodollar Rate Loans
made by such Lender;

 

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and the result of any of the foregoing shall be to increase the cost to such
Lender of making or maintaining any Eurodollar Rate Loan (or of maintaining its
obligation to make any such Loan), or to reduce the amount of any sum received
or receivable by such Lender hereunder (whether of principal, interest or any
other amount) then, upon request of such Lender, Borrower will pay to such
Lender such additional amount or amounts as will compensate such Lender for such
additional costs incurred or reduction suffered.

 

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

 

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

 

(d)           Delay in Requests.  Failure or delay on the part of any Lender to
demand compensation pursuant to the foregoing provisions of this Section shall
not constitute a waiver of such Lender’s right to demand such compensation,
provided that Borrower shall not be required to compensate a Lender pursuant to
the foregoing provisions of this Section for any increased costs incurred or
reductions suffered more than nine months prior to the date that such Lender
notifies Borrower of the Change in Law giving rise to such increased costs or
reductions and of such Lender’s intention to claim compensation therefor (except
that, if the Change in Law giving rise to such increased costs or reductions is
retroactive, then the nine-month period referred to above shall be extended to
include the period of retroactive effect thereof).

 

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

 

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

 

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

 

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including any loss of anticipated profits and any loss or expense arising from
the liquidation or reemployment of funds obtained by it to maintain such Loan or
from fees payable to terminate the deposits from which such funds were
obtained.  Borrower shall also pay any customary administrative fees charged by
such Lender in connection with the foregoing.  For purposes of calculating
amounts payable by Borrower to Lenders under this Section 3.05, each Lender
shall be deemed to have funded each Eurodollar Rate Loan made by it at the
Eurodollar Base Rate used in determining the Eurodollar Rate for such Loan by a
matching deposit or other borrowing in the London interbank eurodollar market
for a comparable amount and for a comparable period, whether or not such
Eurodollar Rate Loan was in fact so funded.

 

3.06         Mitigation Obligations.  If any Lender requests compensation under
Section 3.04, or Borrower is required to pay any additional amount to any Lender
or any Governmental Authority for the account of any Lender pursuant to
Section 3.01, or if any Lender gives a notice pursuant to Section 3.02, 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 3.01 or 3.04, as the case may be,
in the future, or eliminate the need for the notice pursuant to Section 3.02, as
applicable, and (ii) in each case, would not subject such Lender to any
unreimbursed cost or expense and would not otherwise be disadvantageous to such
Lender.  Borrower hereby agrees to pay all reasonable costs and expenses
incurred by any Lender in connection with any such designation or assignment.

 

3.07         Survival.  All of Borrower’s obligations under this Article III
shall survive termination of the Aggregate Commitments and repayment of all
other Obligations hereunder.

 

ARTICLE IV.        CONDITIONS PRECEDENT TO BORROWINGS

 

4.01         Conditions of Initial Borrowing.  The obligation of each Lender to
make its initial Borrowing hereunder is subject to satisfaction of the following
conditions precedent:

 

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

 

(i)            executed counterparts of this Agreement, sufficient in number for
distribution to Agent, each Lender and Borrower;

 

(ii)           a Revolving Credit Note executed by Borrower in favor of each
Lender requesting such a Note;

 

(iii)          such certificates of resolutions or other action, incumbency
certificates and/or other certificates of Responsible Officers of each Loan
Party as Agent may require evidencing the identity, authority and capacity of
each Responsible Officer thereof

 

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authorized to act as a Responsible Officer in connection with this Agreement and
the other Loan Documents to which such Loan Party is a party;

 

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

 

(v)           a favorable opinion of counsel to the Loan Parties acceptable to
Agent addressed to Agent and each Lender, as to the matters set forth concerning
the Loan Parties and the Loan Documents in form and substance satisfactory to
Agent;

 

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

 

(vii)         a certificate signed by a Responsible Officer of Borrower
certifying (A) that the conditions specified in Sections 4.02(a) and (b) have
been satisfied, and (B) that there has been no event or circumstance since the
date of the Audited Financial Statements that has had or could be reasonably
expected to have, either individually or in the aggregate, a Material Adverse
Effect;

 

(viii)        evidence that all insurance required to be maintained pursuant to
the Loan Documents has been obtained and is in effect;

 

(ix)           a duly completed Compliance Certificate as of the last day of the
fiscal quarter of Borrower most recently ended prior to the Closing Date, signed
by a Responsible Officer of Borrower; and

 

(x)            such other assurances, certificates, documents, consents or
opinions as Agent or the Required Lenders reasonably may require.

 

(b)           Any fees required to be paid on or before the Closing Date shall
have been paid.

 

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

 

(d)           The Closing Date shall have occurred on or before February 1,
2008.

 

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

 

4.02         Conditions to all Borrowings.  The obligation of each Lender to
honor any Committed Loan Notice is subject to the following conditions
precedent:

 

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

 

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

 

(c)           Agent shall have received a Committed Loan Notice in accordance
with the requirements hereof.

 

(d)           Agent shall have received, in form and substance satisfactory to
it, such other assurances, certificates, documents or consents related to the
foregoing as Agent or the Required Lenders reasonably may require.

 

Each Committed Loan Notice submitted by Borrower shall be deemed to be a
representation and warranty that the conditions specified in Sections
4.02(a) and (b) have been satisfied on and as of the date of the applicable
Borrowing.

 

ARTICLE V.         REPRESENTATIONS AND WARRANTIES

 

                Each Loan Party represents and warrants to Agent and the Lenders
that:

 

5.01         Existence, Qualification and Power.  Such Loan Party (a) is duly
organized or formed, validly existing and, as applicable, in good standing under
the Laws of the jurisdiction of its incorporation or organization, (b) has all
requisite power and authority and all requisite governmental licenses,
authorizations, consents and approvals to (i) own or lease its assets and carry
on its business and (ii) execute, deliver and perform its obligations under the
Loan Documents to which it is a party, and (c) is duly qualified and is licensed
and, as applicable, in good standing under the Laws of each jurisdiction where
its ownership, lease or operation of

 

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properties or the conduct of its business requires such qualification or
license; except in each case referred to in clause (b)(i), or (c), to the extent
that failure to do so could not reasonably be expected to have a Material
Adverse Effect.

 

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

 

5.03         Governmental Authorization; Other Consents.  No approval, consent,
exemption, authorization, or other action by, or notice to, or filing with, any
Governmental Authority or any other Person is necessary or required in
connection with the execution, delivery or performance by, or enforcement
against, such Loan Party of this Agreement or any other Loan Document to which
such Loan Party is party, except for those which have been duly obtained, taken,
given or made and are in full force and effect.

 

5.04         Binding Effect.  This Agreement has been, and each other Loan
Document, when delivered hereunder, will have been, duly executed and delivered
by such Loan Party that is party thereto.  This Agreement constitutes, and each
other Loan Document to which such Loan Party is party when so delivered will
constitute, a legal, valid and binding obligation of such Loan Party,
enforceable against such Loan Party in accordance with its terms, subject to
(i) applicable bankruptcy, insolvency, moratorium, fraudulent transfer and other
laws affecting creditors’ rights generally and (ii) general principles of
equity, regardless of whether considered in a proceeding at law or in equity.

 

5.05         Financial Statements; No Material Adverse Effect.

 

(a)           The Audited Financial Statements (i) were prepared in accordance
with GAAP consistently applied throughout the period covered thereby, except as
otherwise expressly noted therein; (ii) fairly present the financial condition
of Borrower and its Subsidiaries as of the date thereof and their results of
operations for the period covered thereby in accordance with GAAP consistently
applied throughout the period covered thereby, except as otherwise expressly
noted therein; and (iii) show all material indebtedness and other liabilities,
direct or contingent, of Borrower and its Subsidiaries as of the date thereof,
including liabilities for taxes, material commitments and Indebtedness.

 

(b)           The unaudited consolidated balance sheets of Borrower and its
Subsidiaries dated June 30, 2007 and September 30, 2007, and the related
consolidated statements of income or operations, shareholders’ equity and cash
flows for the fiscal quarters ended on such dates (i) were prepared in
accordance with GAAP consistently applied throughout the period covered thereby,
except as otherwise expressly noted therein, and (ii) fairly present in

 

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all material respects the financial condition of Borrower and its Subsidiaries
as of the dates thereof and their results of operations for the periods covered
thereby, subject, in the case of clauses (i) and (ii), to the absence of
footnotes and to normal year-end audit adjustments.

 

(c)           Except as set forth in the most recent annual, audited financial
statements described in Section 5.05(a) or (b) or delivered pursuant to
Section 6.01(a), since the date of the Audited Financial Statements (or, if
later, the last day of the fiscal year covered by the most recent annual,
audited financial statements delivered pursuant to Section 6.01(a)), there has
been no event or circumstance, either individually or in the aggregate, that has
had or could reasonably be expected to have a Material Adverse Effect.

 

(d)           The consolidated five-year financial forecasts, balance sheet
forecast and cash flow projections of Borrower and its Subsidiaries as at
January 10, 2008, delivered to Agent (copies of which have been furnished to
each Lender), and the annual budget and projections delivered pursuant to
Section 6.01(c), were prepared in good faith on the basis of the assumptions
stated therein, which assumptions were reasonable in light of the conditions
existing at the time of delivery of such forecasts, and represented, at the time
of delivery, Borrower’s good faith estimate of its future financial condition
and performance.

 

5.06         Litigation.  There are no actions, suits, proceedings, claims or
disputes pending or, to the knowledge of such Loan Party, threatened or
contemplated, at law, in equity, in arbitration or before any Governmental
Authority, by or against such Loan Party or against any of its properties or
revenues that (a) purport to affect or pertain to this Agreement or any other
Loan Document, or any of the transactions contemplated hereby, or (b) except as
specifically disclosed in Schedule 5.06, either individually or in the
aggregate, if determined adversely, could reasonably be expected to have a
Material Adverse Effect, and there has been no adverse change in the status, or
financial effect on such Loan Party, of the matters described on Schedule 5.06.

 

5.07         No Default.  Such Loan Party is not in default under or with
respect to any Contractual Obligation that could, either individually or in the
aggregate, reasonably be expected to have a Material Adverse Effect.  No Default
has occurred and is continuing or could reasonably be expected to result from
the consummation of the transactions contemplated by this Agreement or any other
Loan Document.

 

5.08         Ownership of Property; Liens.  Such Loan Party has good and
marketable title to, or valid leasehold interests in, all real property
necessary or used in the ordinary conduct of its business, except for such
defects in title as could not, individually or in the aggregate, reasonably be
expected to have a Material Adverse Effect.  The property of such Loan Party is
subject to no Liens, other than Liens permitted by Section 7.01.

 

5.09         Environmental Compliance.  Except as specifically disclosed in
Schedule 5.09, such Loan Party is not in violation of applicable Environmental
Laws in any material respect, and no claims alleging potential liability or
responsibility for violation of any Environmental Law which could, individually
or in the aggregate, reasonably be expected to have a Material Adverse Effect
are pending or, to such Loan Party’s knowledge, threatened against such Loan
Party or any of its properties.

 

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5.10         Insurance.  The properties of such Loan Party are insured with
financially sound and reputable insurance companies not Affiliates of such Loan
Party, in such amounts (after giving effect to any self-insurance compatible
with the following standards), with such deductibles and covering such risks as
are customarily carried by companies engaged in similar businesses and owning
similar properties in localities where such Loan Party operates.

 

5.11         Taxes.  Such Loan Party has filed all Federal, state and other
material tax returns and reports required to be filed, and has paid all Federal,
state and other material taxes, assessments, fees and other governmental charges
levied or imposed upon it or its properties, income or assets otherwise due and
payable, except those which are being contested in good faith by appropriate
proceedings diligently conducted and for which adequate reserves have been
provided in accordance with GAAP.  To the best of such Loan Party’s knowledge,
there is no proposed tax assessment against such Loan Party that would, if made,
have a Material Adverse Effect.

 

5.12         ERISA Compliance.

 

(a)           Each Plan is in compliance in all material respects with the
applicable provisions of ERISA, the Code and other Federal or state Laws.  Each
Plan that is intended to qualify under Section 401(a) of the Code has received a
favorable determination letter from the IRS or an application for such a letter
is currently being processed by the IRS with respect thereto and, to the
knowledge of such Loan Party, nothing has occurred which would prevent, or cause
the loss of, such qualification.  Such Loan Party and each ERISA Affiliate have
made all required contributions to each Plan subject to Section 412 of the Code,
and no application for a funding waiver or an extension of any amortization
period pursuant to Section 412 of the Code has been made with respect to any
Plan.

 

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

 

(c)           (i)  No ERISA Event has occurred or could reasonably be expected
to occur; (ii) no Pension Plan has any Unfunded Pension Liability; (iii) neither
such Loan Party nor any ERISA Affiliate has incurred, or reasonably expects to
incur, any liability under Title IV of ERISA with respect to any Pension Plan
(other than premiums due and not delinquent under Section 4007 of ERISA);
(iv) neither such Loan Party nor any ERISA Affiliate has incurred, or reasonably
expects to incur, any liability (and no event has occurred which, with the
giving of notice under Section 4219 of ERISA, would result in such liability)
under Section 4201 or 4243 of ERISA with respect to a Multiemployer Plan; and
(v) neither such Loan Party nor any ERISA Affiliate has engaged in a transaction
that could be subject to Section 4069 or 4212(c) of ERISA.

 

5.13         Subsidiaries.  As of the Closing Date, such Loan Party has no
Subsidiaries other than those specifically disclosed in Part (a) of Schedule
5.13, and all of the outstanding Equity Interests in such Subsidiaries have been
validly issued, are fully paid and nonassessable and are

 

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owned by a Loan Party in the amounts specified on Part (a) of Schedule 5.13 free
and clear of all Liens.  Such Loan Party has no equity investments or joint
venture investments in any other corporation or entity other than those
specifically disclosed in Part (b) of Schedule 5.13.  All of the outstanding
Equity Interests in such Loan Party have been validly issued and are fully paid
and nonassessable and, with respect to 100% of the Equity Securities of each
Guarantor, are owned by the Borrower free and clear of all Liens.

 

5.14         Margin Regulations; Investment Company Act.

 

(a)           Such Loan Party is not engaged and will not engage, principally or
as one of its important activities, in the business of purchasing or carrying
margin stock (within the meaning of Regulation U issued by the FRB), or
extending credit for the purpose of purchasing or carrying margin stock.

 

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

 

5.15         Disclosure.  Such Loan Party has disclosed to Agent and Lenders all
agreements, instruments and corporate or other restrictions to which it 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. 
No report, financial statement, certificate or other information furnished
(whether in writing or orally) by or on behalf of any Loan Party to Agent or any
Lender in connection with the transactions contemplated hereby and the
negotiation of this Agreement or delivered hereunder or under any other Loan
Document (in each case, 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, such Loan Party represents only that
such information was prepared in good faith based upon assumptions believed to
be reasonable at the time.

 

5.16         Compliance with Laws.  Such Loan Party is in compliance in all
material respects with the requirements of all Laws and all orders, writs,
injunctions and decrees applicable to it or to its properties, except in such
instances in which (a) such requirement of Law or order, writ, injunction or
decree is being contested in good faith by appropriate proceedings diligently
conducted or (b) the failure to comply therewith, either individually or in the
aggregate, could not reasonably be expected to have a Material Adverse Effect.

 

5.17         Taxpayer Identification Number.  Borrower’s true and correct U.S.
taxpayer identification number is set forth on Schedule 10.02.

 

5.18         Intellectual Property; Licenses, Etc.  Such Loan Party owns, or
possesses the right to use, all of the trademarks, service marks, trade names,
copyrights, patents, patent rights, franchises, licenses and other intellectual
property rights that are reasonably necessary for the operation of its business,
without (to such Loan Party’s knowledge) conflict with the rights of any other
Person.  To the knowledge of such Loan Party, no slogan or other advertising
device,

 

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product, process, method, substance, part or other material now employed, or now
contemplated to be employed, by such Loan Party infringes in any material
respect upon any rights held by any other Person.  No claim or litigation
regarding any of the foregoing is pending or, to the knowledge of such Loan
Party, threatened, which, either individually or in the aggregate, could
reasonably be expected to have a Material Adverse Effect.

 

ARTICLE VI.        AFFIRMATIVE COVENANTS

 

So long as any Lender shall have any Commitment hereunder, or any Loan or other
Obligation (other than unasserted contingent indemnification obligations)
hereunder shall remain unpaid or unsatisfied, Borrower shall, and shall (except
in the case of the covenants set forth in Sections 6.01, 6.02,  6.03, 6.11 and
6.12) cause each other Loan Party to:

 

6.01         Financial Statements.  Deliver to Agent a sufficient number of
copies for delivery by Agent to each Lender, in form and detail reasonably
satisfactory to Agent:

 

(a)           as soon as available, but in any event within 120 days after the
end of each fiscal year of Borrower, a consolidated balance sheet of Borrower
and its Subsidiaries as at the end of such fiscal year, and the related
consolidated statements of income or operations, shareholders’ equity and cash
flows for such fiscal year, setting forth in each case in comparative form the
figures for the previous fiscal year, all in reasonable detail and prepared in
accordance with GAAP, such consolidated statements to be audited and accompanied
by a report and opinion of PriceWaterhouseCoopers LLC or another independent
certified public accountant of nationally recognized standing and meeting the
standards of the Public Company Accounting Oversight Board, which report and
opinion shall be prepared in accordance with generally accepted auditing
standards and shall not be subject to any “going concern” or like qualification
or exception or any qualification or exception as to the scope of such audit;

 

(b)           as soon as available, but in any event within 45 days after the
end of each of the first three fiscal quarters of each fiscal year of Borrower,
a consolidated balance sheet of Borrower and its Subsidiaries as at the end of
such fiscal quarter, and the related consolidated statements of income or
operations, shareholders’ equity and cash flows for such fiscal quarter and for
the portion of Borrower’s fiscal year then ended, setting forth in each case in
comparative form the figures for the corresponding fiscal quarter of the
previous fiscal year and the corresponding portion of the previous fiscal year,
all in reasonable detail, such consolidated statements to be certified by the
chief executive officer, chief financial officer, treasurer or controller of
Borrower as fairly presenting in all material respects the financial condition,
results of operations, shareholders’ equity and cash flows of Borrower and its
Subsidiaries as of the date thereof in accordance with GAAP, subject only to
normal year-end audit adjustments and the absence of footnotes;

 

(c)           as soon as available, but in any event before January 31 of each
fiscal year of Borrower, an annual budget and projections prepared by the
management of Borrower, in form reasonably satisfactory to Agent and the
Required Lenders, of consolidated balance sheets and statements of income or
operations and cash flows of Borrower and its Subsidiaries on a

 

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quarterly basis for such fiscal year (including the fiscal year in which the
Maturity Date occurs); and

 

(d)           concurrently with the delivery of the financial statements
referred to in Sections 6.01(a) and (b), a quarterly schedule reconciling the
cash receipts of Milestone Payments to the revenue recorded from such payments
according to GAAP.

 

6.02         Certificates; Other Information.  Deliver to Agent a sufficient
number of copies for delivery by Agent to each Lender, in form and detail
reasonably satisfactory to Agent:

 

(a)           concurrently with the delivery of the financial statements
referred to in Section 6.01(a), a certificate of its independent certified
public accountants certifying such financial statements and stating that in
making the examination necessary therefor no knowledge was obtained of any
Default or, if any such Default shall exist, stating the nature and status of
such event (which certificate may be limited or not delivered to the extent
required by accounting rules or guidelines or to the extent that such
certificate cannot be obtained without additional cost);

 

(b)           concurrently with the delivery of the financial statements
referred to in Sections 6.01(a) and (b), a duly completed Compliance Certificate
signed by the chief executive officer, chief financial officer, treasurer or
controller of Borrower;

 

(c)           promptly after the same are available, copies of any audit
reports, management letters or recommendations submitted to the board of
directors (or the audit committee of the board of directors) of Borrower by
independent accountants in connection with the accounts or books of Borrower or
any Subsidiary, or any audit of any of them;

 

(d)           promptly after the same are available, copies of each annual
report, proxy or financial statement or other report or communication sent to
the stockholders of Borrower, and copies of all annual, regular, periodic and
special reports and registration statements which Borrower may file or be
required to file with the SEC under Section 13 or 15(d) of the Securities
Exchange Act of 1934, and not otherwise required to be delivered to Agent
pursuant hereto;

 

(e)           promptly after the furnishing thereof, copies of any statement or
report furnished to any holder of debt securities of any Loan Party pursuant to
the terms of any indenture, loan or credit or similar agreement and not
otherwise required to be furnished to the Lenders pursuant to Section 6.01 or
any other clause of this Section 6.02;

 

(f)            promptly, and in any event within five Business Days after
receipt thereof by any Loan Party or any Subsidiary thereof, copies of each
notice or other correspondence received from the SEC (or comparable agency in
any applicable non-U.S. jurisdiction) concerning any investigation or other
inquiry by such agency regarding financial or other operational results of any
Loan Party which could reasonably be expected to have a Material Adverse Effect;
and

 

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(g)           promptly, such additional information regarding the business,
financial or corporate affairs of Borrower or any Subsidiary, or compliance with
the terms of the Loan Documents, as Agent or any Lender may from time to time
reasonably request.

 

Documents required to be delivered pursuant to Section 6.01(a) or (b) or
Section 6.02(d) (to the extent any such documents are included in materials
otherwise filed with the SEC) may be delivered electronically and if so
delivered, shall be deemed to have been delivered on the date (i) on which
Borrower posts such documents, or provides a link thereto on Borrower’s website
on the Internet at the website address listed on Schedule 10.02; or (ii) on
which such documents are posted on Borrower’s behalf on an Internet or intranet
website, if any, to which each Lender and Agent have access (whether a
commercial, third-party website or whether sponsored by Agent); provided that:
(i) Borrower shall deliver paper copies of such documents to Agent or any Lender
that requests (through Agent) Borrower to deliver such paper copies until a
written request to cease delivering paper copies is given by Agent or such
Lender and (ii) Borrower shall notify Agent (by telecopier or electronic mail)
of the posting of any such documents and provide to Agent by electronic mail
electronic versions (i.e., soft copies) of such documents.

 

Borrower hereby acknowledges that (a) Agent will make available to Lenders
materials and/or information provided by or on behalf of Borrower hereunder
(collectively, “Borrower Materials”) by posting Borrower Materials on IntraLinks
or another similar electronic system (the “Platform”) and (b) certain of the
Lenders (each, a “Public Lender”) may have personnel who do not wish to receive
material non-public information with respect to Borrower or its Affiliates or
the respective securities of any of the foregoing, and who may be engaged in
investment and other market-related activities with respect to such Persons’
securities.  Borrower hereby agrees that (w) all Borrower Materials that are to
be made available to Public Lenders shall be clearly and conspicuously marked
“PUBLIC” which, at a minimum, shall mean that the word “PUBLIC” shall appear
prominently on the first page thereof; (x) by marking Borrower Materials
“PUBLIC,” Borrower shall be deemed to have authorized Agent and the Lenders to
treat such Borrower Materials as not containing any material non-public
information with respect to Borrower or its securities for purposes of United
States Federal and state securities laws (provided, however, that to the extent
such Borrower Materials constitute Information, they shall be treated as set
forth in Section 11.07); (y) all Borrower Materials marked “PUBLIC” are
permitted to be made available through a portion of the Platform designated
“Public Investor;” and (z) Agent shall be entitled to treat any Borrower
Materials that are not marked “PUBLIC” as being suitable only for posting on a
portion of the Platform not designated “Public Investor”.

 

6.03         Notices.  Promptly notify Agent:

 

(a)           of the occurrence of any Default;

 

(b)           of any matter that has resulted or could reasonably be expected to
result in a Material Adverse Effect, including (i) breach or non-performance of,
or any default under, a Material Contract or other material Contractual
Obligation of Borrower or any Subsidiary; (ii) any material dispute, litigation,
investigation, proceeding or suspension between Borrower or any Subsidiary and
any Governmental Authority (other than routine FDA proceedings that could not
reasonably be expected to have a Material Adverse Effect); or (iii) the
commencement of, or any

 

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material development in, any material litigation or proceeding affecting
Borrower or any Subsidiary, including pursuant to any applicable Environmental
Laws, but excluding routine FDA proceedings that could not reasonably be
expected to have a Material Adverse Effect;

 

(c)           of the occurrence of any ERISA Event;  and

 

(d)           of any material change in accounting policies or financial
reporting practices by Borrower or any other Loan Party.

 

Each notice pursuant to this Section shall be accompanied by a statement of a
Responsible Officer of Borrower setting forth details of the occurrence referred
to therein and stating what action Borrower has taken and proposes to take with
respect thereto.  Each notice pursuant to Section 6.03(a) shall describe with
particularity any and all provisions of this Agreement and any other Loan
Document that have been breached.

 

6.04         Payment of Obligations.  Pay and discharge as the same shall become
due and payable, all its obligations and liabilities, including (a) all tax
liabilities, assessments and governmental charges or levies upon it or its
properties or assets, unless the same are being contested in good faith by
appropriate proceedings diligently conducted and adequate reserves in accordance
with GAAP are being maintained by Borrower or such Loan Party; (b) all lawful
claims which, if unpaid, would by law become a Lien upon its property; and
(c) all Indebtedness, as and when due and payable, but subject to any
subordination provisions contained in any instrument or agreement evidencing
such Indebtedness.

 

6.05         Preservation of Existence, Etc.  (a) Preserve, renew and maintain
in full force and effect its legal existence and good standing under the Laws of
the jurisdiction of its organization except in a transaction permitted by
Section 7.04 or 7.05; (b) take all reasonable action to maintain all rights,
privileges, permits, licenses and franchises necessary or desirable in the
normal conduct of its business, except to the extent that failure to do so could
not reasonably be expected to have a Material Adverse Effect; and (c) preserve
or renew all of its registered patents, trademarks, trade names and service
marks, the non-preservation of which could reasonably be expected to have a
Material Adverse Effect.

 

6.06         Maintenance of Properties.  (a) Maintain, preserve and protect all
of its material properties and equipment necessary in the operation of its
business in good working order and condition, ordinary wear and tear excepted;
(b) make all necessary repairs thereto and renewals and replacements thereof
except where the failure to do so could not reasonably be expected to have a
Material Adverse Effect; and (c) use the standard of care typical in the
industry in the operation and maintenance of its facilities.

 

6.07         Maintenance of Insurance.  Maintain with financially sound and
reputable insurance companies not Affiliates of Borrower, insurance with respect
to its properties and business against loss or damage of the kinds customarily
insured against by Persons engaged in the same or similar business, of such
types and in such amounts (after giving effect to any self-insurance compatible
with the following standards) as are customarily carried under similar

 

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circumstances by such other Persons and providing for not less than 30 days’
prior notice to Agent of termination, lapse or cancellation of such insurance.

 

6.08         Compliance with Laws.  Comply in all material respects with the
requirements of all Laws and all orders, writs, injunctions and decrees
applicable to it or to its business or property, except in such instances in
which (a) such requirement of Law or order, write, injunction or decree is being
contested in good faith by appropriate proceedings diligently conducted; or
(b) the failure to comply therewith could not reasonably be expected to have a
Material Adverse Effect.

 

6.09         Books and Records.  (a)  Maintain proper books of record and
account, in which full, true and correct entries in conformity with GAAP
consistently applied shall be made of all financial transactions and matters
involving the assets and business of Borrower or such Loan Party, as the case
may be; and (b) maintain such books of record and account in material conformity
with all applicable requirements of any Governmental Authority having regulatory
jurisdiction over Borrower or such Loan Party, as the case may be.

 

6.10         Inspection Rights.  Permit representatives and independent
contractors of Agent and each Lender (provided, that if there is more than one
Lender, then such visits or inspections are coordinated through the Agent) to
visit and inspect any of its properties, to examine its corporate, financial and
operating records, and make copies thereof or abstracts therefrom, and to
discuss its affairs, finances and accounts with its directors, officers, and
independent public accountants, all at the expense of Borrower and at such
reasonable times during normal business hours and as often as may be reasonably
desired, upon reasonable advance notice to Borrower; provided, however, that
when an Event of Default exists Agent or any Lender (or any of their respective
representatives or independent contractors) may do any of the foregoing at the
expense of Borrower at any time during normal business hours and without advance
notice.

 

6.11         Use of Proceeds.  Use the proceeds of the Borrowings to finance
leasehold improvements to, and new equipment for, the Bedford Facility not in
contravention of any Law or of any Loan Document.

 

6.12         Financial Covenants.

 

(a)           Quick Ratio.  Maintain on a consolidated basis a ratio of
(i) Quick Assets to (ii) Total Current Liabilities plus Total Revolving Credit
Outstandings, of at least 2.0:1.0.

 

(b)           Consolidated Fixed Charge Coverage Ratio.  Maintain on a
consolidated basis a Consolidated Fixed Charge Coverage Ratio of at least
1.25:1.0.

 

These ratios will be calculated at the end of each reporting period for which
this Agreement requires Borrower to deliver financial statements, using the
results of the twelve-month period ending with that reporting period.  The
current portion of long-term liabilities will be measured as of the last day of
such reporting period.

 

6.13         Additional Guarantors.  Notify Agent at the time that any Person
becomes a Subsidiary of Borrower, and, unless otherwise agreed in writing by the
Lenders, promptly

 

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thereafter (and in any event within 30 days), (a) cause such Person to become a
Guarantor (or if such Subsidiary is a “controlled foreign corporation” under
Section 957 of the Code, grant Agent a first-priority, perfected security
interest in 65% of the capital stock or other equity of such Foreign Subsidiary)
by executing and delivering to Agent a counterpart of this Agreement or such
other document(s) as Agent shall deem reasonably appropriate for such purpose,
and (b) deliver, or cause such Person to deliver, to Agent documents of the
types referred to in clauses (iii) and (iv) of Section 4.01(a) and favorable
opinions of counsel to such Person (which shall cover, among other things, the
legality, validity, binding effect and enforceability of the documentation
referred to in clause (a)), all in form, content and scope reasonably
satisfactory to Agent.

 

ARTICLE VII.      NEGATIVE COVENANTS

 

So long as any Lender shall have any Commitment hereunder, or any Loan or other
Obligation (other than unasserted contingent indemnification obligations)
hereunder shall remain unpaid or unsatisfied, Borrower shall not, nor shall it
permit any other Loan Party to, directly or indirectly:

 

7.01         Liens.  Create, incur, assume or suffer to exist any Lien upon any
of its property, assets or revenues, whether now owned or hereafter acquired, or
sign or file or suffer to exist under the Uniform Commercial Code of any
jurisdiction a financing that names any Loan Party as a debtor, or assign any
accounts or other right to receive income, other than the following:

 

(a)           Liens in favor of the Agent and Lenders (if any);

 

(b)           Liens existing on the date hereof and listed on Schedule 7.01 and
any renewals or extensions thereof, provided that (i) the property covered
thereby is not changed, (ii) the amount secured or benefited thereby is not
increased except as contemplated by Section 7.03(b), (iii) the direct or any
contingent obligor with respect thereto is not changed, and (iv)  and any
renewal or extension of the obligations secured or benefited thereby is
permitted by Section 7.03(b);

 

(c)           Liens for taxes not yet due or which are being contested in good
faith and by appropriate proceedings diligently conducted, if adequate reserves
with respect thereto are maintained on the books of the applicable Person in
accordance with GAAP;

 

(d)           carriers’, warehousemen’s, mechanics’, materialmen’s, repairmen’s
or other like Liens arising in the ordinary course of business which are not
overdue for a period of more than 30 days or which are being contested in good
faith and by appropriate proceedings diligently conducted, if adequate reserves
with respect thereto are maintained on the books of the applicable Person;

 

(e)           pledges or deposits in the ordinary course of business in
connection with workers’ compensation, unemployment insurance and other social
security legislation, other than any Lien imposed by ERISA;

 

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

 

(g)           easements, rights-of-way, restrictions and other similar
encumbrances affecting real property which, in the aggregate, are not
substantial in amount, and which do not in any case materially detract from the
value of the property subject thereto or materially interfere with the ordinary
conduct of the business of the applicable Person;

 

(h)           Liens securing judgments for the payment of money not constituting
an Event of Default under Section 8.01(h); and

 

(i)            Liens securing Indebtedness permitted under Section 7.03(e),
(f) or (g); provided that (i) such Liens do not at any time encumber any
property other than the property financed by such Indebtedness and (ii) the
Indebtedness secured thereby does not exceed the cost or fair market value,
whichever is lower, of the property being acquired on the date of acquisition.

 

7.02         Investments.  Make any Investments, except:

 

(a)           Investments held by Borrower or such Subsidiary in the form of
cash equivalents or short-term marketable debt securities;

 

(b)           advances to officers, directors and employees of Borrower and
Subsidiaries in an aggregate amount not to exceed $500,000 at any time
outstanding, for travel, entertainment, relocation and analogous ordinary
business purposes;

 

(c)           Investments of Borrower in any Guarantor and Investments of any
Guarantor in Borrower or in another Guarantor;

 

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

 

(e)           Guarantees permitted by Section 7.03;

 

(f)            Investments existing on the date hereof (other than those
referred to in Section 7.02(c)) and set forth on Schedule 7.02;

 

(g)           Investments by the Borrower in Swap Contracts permitted under
Section 7.03(d);

 

(h)           the purchase or other acquisition of (1) all of the Equity
Interests in, or (2) all or substantially all of the property of, or (3) any
product line, line of business or division of, any Person that, upon the
consummation thereof, will be at least 50% owned directly by the Borrower or one
or more Guarantors (including as a result of a merger or consolidation);

 

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provided that, with respect to each purchase or other acquisition made pursuant
to this Section 7.02(h):

 

(i)            any such newly-created or acquired Subsidiary shall comply with
the requirements of Section 6.13;

 

(ii)           neither Borrower nor any Subsidiary thereof shall directly own or
hold any Equity Interest in any joint venture if as a matter of law Borrower or
any of its Subsidiaries is liable for the debts and liabilities of such joint
venture;

 

(iii)          the lines of business of the Person to be (or the property of
which is to be) so purchased or otherwise acquired shall be substantially the
same or substantially related lines of business as one or more of the principal
businesses of the Borrower and its Subsidiaries in the ordinary course;

 

(iv)          such purchase or other acquisition shall not include or result in
the incurrence or assumption of any contingent liabilities that could reasonably
be expected to have a material adverse effect on the business, operations,
liabilities or condition (financial or otherwise) of the Borrower and its
Subsidiaries, taken as a whole (as determined in good faith by the board of
directors (or the persons performing similar functions) of the Borrower if the
board of directors is otherwise approving such transaction and, in each other
case, by a Responsible Officer);

 

(v)           the total cash and noncash consideration (including the fair
market value of all Equity Interests issued or transferred to the sellers
thereof, all indemnities, earnouts and other contingent payment obligations to,
and the aggregate amounts paid or to be paid under noncompete, consulting and
other affiliated agreements (other than employment agreements for services
actually rendered to a Loan Party after the date thereof) with, the sellers
thereof, all write-downs of property and reserves for liabilities with respect
thereto and all assumptions of Indebtedness and other obligations in connection
therewith) paid by or on behalf of the Borrower and its Subsidiaries for any
such purchase or other acquisition, when aggregated with the total cash and
noncash consideration paid by or on behalf of the Borrower and its Subsidiaries
for all other purchases and other acquisitions made by the Borrower and its
Subsidiaries pursuant to this Section 7.02(h), shall not exceed $10,000,000 in
cumulative aggregate at any time;

 

(vi)          (A) immediately before and immediately after giving pro forma
effect to any such purchase or other acquisition, no Default shall have occurred
and be continuing, (B) immediately before and immediately after giving effect to
such purchase or other acquisition, none of Borrower or any Subsidiary, or to
Borrower’s knowledge any Person Controlling Borrower, shall be or shall be
required to be registered as, an “investment company” under the Investment
Company Act of 1940, and (C) immediately after giving effect to such purchase or
other acquisition, the Borrower and its Subsidiaries shall be in pro forma
compliance with all of the covenants set forth in Section 6.12, such compliance
to be determined on the basis of the financial information most recently
delivered to the Agent pursuant to Section 6.01(a) or (b) as though such
purchase or other acquisition had been consummated as of the first day of the
fiscal period covered thereby; and

 

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(vii)         Borrower shall have delivered to Agent, at least five Business
Days prior to the date on which any such purchase or other acquisition is to be
consummated, a certificate of a Responsible Officer, in form and substance
reasonably satisfactory to Agent, certifying that all of the requirements set
forth in this Section 7.02(h) have been satisfied or will be satisfied on or
prior to the consummation of such purchase or other acquisition.

 

7.03         Indebtedness.  Create, incur, assume or suffer to exist any
Indebtedness, except:

 

(a)           Indebtedness under the Loan Documents;

 

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

 

(c)           Guarantees of Borrower or any Guarantor in respect of Indebtedness
otherwise permitted hereunder of Borrower or any other Guarantor and
Indebtedness of a Guarantor owed to the Borrower or another Guarantor, in each
case that is on terms (including subordination terms) acceptable to the Agent
and is otherwise permitted under Section 7.02;

 

(d)           obligations (contingent or otherwise) of Borrower or any
Subsidiary existing or arising under any Swap Contract, provided that (i) such
obligations are (or were) entered into by such Person in the ordinary course of
business for the purpose of directly mitigating risks associated with
liabilities, commitments, investments, assets, or property held or reasonably
anticipated by such Person, or changes in the value of securities issued by such
Person, and not for purposes of speculation or taking a “market view;” and
(ii) such Swap Contract does not contain any provision exonerating the
non-defaulting party from its obligation to make payments on outstanding
transactions to the defaulting party;

 

(e)           Indebtedness in respect of capital leases, Synthetic Lease
Obligations and purchase money obligations for fixed or capital assets within
the limitations set forth in Section 7.01(i); provided, however, that the
aggregate amount of all such Indebtedness at any one time outstanding shall not
exceed $100,000 in any fiscal year; and

 

(f)            Indebtedness in respect of capital leases and purchase money
obligations for fixed or capital assets acquired in a Permitted Acquisition and
within the limitations set forth

 

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in Section 7.01(i); provided, however, that the aggregate amount of all such
Indebtedness at any one time outstanding shall not exceed $500,000 in any fiscal
year;

 

(g)           Indebtedness in respect of capital leases and purchase money
obligations for fixed or capital assets owing to any Affiliate of Bank of
America and within the limitations set forth in Section 7.01(i); provided,
however, that (i) the aggregate amount of all such Indebtedness at any one time
outstanding shall not exceed $6,000,000 and (ii) the Revolving Credit Facility
shall have been permanently reduced in accordance with Section 2.06 by an amount
equal to the aggregate principal amount of such Indebtedness; and

 

(h)           Subordinated Liabilities, containing terms and conditions
reasonably satisfactory to Agent, that are assumed or acquired by a Loan Party
in compliance with Section 7.02(h), so long as both immediately before and
immediately after giving effect to any such assumption or acquisition, no
Default (including in respect of Section 6.12) has occurred and is continuing or
would result therefrom, and Agent shall have received a certificate of a
Responsible Officer, in form and substance reasonably satisfactory to Agent, to
such effect.

 

7.04         Fundamental Changes.  Merge, dissolve, liquidate, consolidate with
or into another Person, or Dispose of (whether in one transaction or in a series
of transactions) all or substantially all of its assets (whether now owned or
hereafter acquired) to or in favor of any Person, except that, so long as no
Default exists or would result therefrom:

 

(a)           any Subsidiary may merge with (i) Borrower, provided that Borrower
shall be the continuing or surviving Person, or (ii) any one or more Guarantors,
provided that the Guarantor shall be the continuing or surviving Person; and

 

(b)           any Subsidiary may Dispose of all or substantially all of its
assets (upon voluntary liquidation or otherwise) to Borrower or to a Guarantor.

 

7.05         Dispositions.  Make any Disposition or enter into any agreement to
make any Disposition, except:

 

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

 

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

 

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

 

(d)           Dispositions of property by any Subsidiary to Borrower or to a
Guarantor;

 

(e)           Dispositions permitted by Section 7.04; and

 

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(f)            Licenses of intellectual property in the ordinary course of
business that (i) are nonexclusive or (ii) grant exclusive rights to a specified
product in a specified territory for a limited term.

 

provided, however, that any Disposition pursuant to clauses (a) through
(f) shall be for fair market value.

 

7.06         Restricted Payments.  Declare or make, directly or indirectly, any
Restricted Payment, or incur any obligation (contingent or otherwise) to do so,
except that, so long as no Default shall have occurred and be continuing at the
time of any action described below or would result therefrom:

 

(a)           each Subsidiary may make Restricted Payments to Borrower,
Guarantors and any other Person that owns an Equity Interest in such Subsidiary,
ratably according to their respective holdings of the type of Equity Interest in
respect of which such Restricted Payment is being made;

 

(b)           Borrower and each Subsidiary may declare and make dividend
payments or other distributions payable solely in the common stock or other
common Equity Interests of such Person;

 

(c)           Borrower and each Subsidiary may purchase, redeem or otherwise
acquire Equity Interests issued by it with the proceeds received from the
substantially concurrent issue of new shares of its common stock or other common
Equity Interests; and

 

(d)           Borrower may make Restricted Payments to repurchase or redeem
common stock of Borrower held by:

 

(i)            its present or former officers, directors or employees, upon
their death, disability, retirement, severance or termination of employment or
service, provided that the aggregate cash consideration paid for all such
repurchases or redemptions shall not exceed $250,000 in any fiscal year; and

 

(ii)           its public stockholders, provided that both immediately before
and after making such Restricted Payments, Borrower and its Subsidiaries shall
be in pro forma compliance with all of the covenants set forth in Section 6.12,
and Borrower shall have delivered to Agent, at least five Business Days prior to
the making of such Restricted Payments, a certificate from a Responsible Officer
of Borrower (A) certifying that no Default has occurred and is continuing at the
time of any such Restricted Payments or would result therefrom and
(B) demonstrating (in detail reasonably satisfactory to Agent) compliance with
the requirements of this Section 7.06(d)(ii).

 

7.07         Change in Nature of Business.  Engage in any material line of
business substantially different from those lines of business conducted by
Borrower and its Subsidiaries on the date hereof or any business substantially
related or incidental thereto.

 

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7.08         Transactions with Affiliates.  Enter into any transaction of any
kind with any Affiliate of Borrower, whether or not in the ordinary course of
business, other than on fair and reasonable terms substantially as favorable to
Borrower or such Subsidiary as would be obtainable by Borrower or such
Subsidiary at the time in a comparable arm’s length transaction with a Person
other than an Affiliate.

 

7.09         Burdensome Agreements.  Enter into any Contractual Obligation
(other than this Agreement or any other Loan Document) that (a) limits the
ability (i) of any Subsidiary to make Restricted Payments to any Loan Party or
to otherwise transfer property to any Loan Party, (ii) of any Subsidiary to
Guarantee the Indebtedness of Borrower or (iii) of Borrower or any Subsidiary to
create, incur, assume or suffer to exist Liens on property of such Person;
provided, however, that this clause (iii) shall not prohibit any negative pledge
incurred or provided in favor of any holder of Indebtedness permitted under
Section 7.03(e) solely to the extent any such negative pledge relates to the
property financed by or the subject of such Indebtedness; or (b) requires the
grant of a Lien to secure an obligation of such Person if a Lien is granted to
secure another obligation of such Person.

 

7.10         Use of Proceeds.  Use the proceeds of any Borrowing, whether
directly or indirectly, and whether immediately, incidentally or ultimately, to
purchase or carry margin stock (within the meaning of Regulation U of the FRB)
or to extend credit to others for the purpose of purchasing or carrying margin
stock or to refund indebtedness originally incurred for such purpose.

 

ARTICLE VIII.     EVENTS OF DEFAULT AND REMEDIES

 

8.01         Events of Default.  Any of the following shall constitute an Event
of Default:

 

(a)           Non-Payment.  Borrower or any other Loan Party fails to pay
(i) when and as required to be paid herein, any amount of principal of any Loan,
or (ii) within three Business Days after the same becomes due, any interest on
any Loan, or any fee due hereunder, or (iii) within five days after the same
becomes due, any other amount payable hereunder or under any other Loan
Document; or

 

(b)           Specific Covenants.  Borrower fails to perform or observe any
term, covenant or agreement contained in any of Section 6.01, 6.02, 6.03, 6.05,
6.10, 6.11, 6.12 or 6.13 or Article VII, and, with respect to Section 6.01,
6.02, 6.03, such failure continues for one Business Day after notice thereof to
Borrower or after Borrower obtains knowledge thereof, or any Guarantor fails to
perform or observe any term, covenant or agreement contained in the Guaranty; or

 

(c)           Other Defaults.  Any Loan Party fails to perform or observe any
other covenant or agreement (not specified in subsection (a) or (b) above)
contained in any Loan Document on its part to be performed or observed and such
failure continues for 30 days or any default or Event of Default occurs under
any other Loan Document; or

 

(d)           Representations and Warranties.  Any representation, warranty,
certification or statement of fact made or deemed made by or on behalf of
Borrower or any other

 

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Loan Party herein, in any other Loan Document, or in any document delivered in
connection herewith or therewith shall be incorrect or misleading in any
material respect when made or deemed made; or

 

(e)           Cross-Default.  (i) Borrower or any Loan Party (A) fails to make
any payment when due (whether by scheduled maturity, required prepayment,
acceleration, demand, or otherwise) in respect of any Indebtedness or Guarantee
(other than Indebtedness hereunder and Indebtedness under Swap Contracts) having
an aggregate principal amount (including undrawn committed or available amounts
and including amounts owing to all creditors under any combined or syndicated
credit arrangement) of more than the Threshold Amount, or (B) fails to observe
or perform any other agreement or condition relating to any such Indebtedness or
Guarantee or contained in any instrument or agreement evidencing, securing or
relating thereto, or any other event occurs, the effect of which default or
other event is to cause, or to permit the holder or holders of such Indebtedness
or the beneficiary or beneficiaries of such Guarantee (or a trustee or agent on
behalf of such holder or holders or beneficiary or beneficiaries) to cause, with
the giving of notice if required, such Indebtedness to be demanded or to become
due or to be repurchased, prepaid, defeased or redeemed (automatically or
otherwise), or an offer to repurchase, prepay, defease or redeem such
Indebtedness to be made, prior to its stated maturity, or such Guarantee to
become payable or cash collateral in respect thereof to be demanded; or
(ii) there occurs under any Swap Contract an Early Termination Date (as defined
in such Swap Contract) resulting from (A) any event of default under such Swap
Contract as to which Borrower or any Subsidiary is the Defaulting Party (as
defined in such Swap Contract) or (B) any Termination Event (as so defined)
under such Swap Contract as to which Borrower or any Subsidiary is an Affected
Party (as so defined) and, in either event, the Swap Termination Value owed by
Borrower or such Subsidiary as a result thereof is greater than the Threshold
Amount; or

 

(f)            Insolvency Proceedings, Etc.  Any Loan Party institutes or
consents to the institution of any proceeding under any Debtor Relief Law, or
makes an assignment for the benefit of creditors; or applies for or consents to
the appointment of any receiver, trustee, custodian, conservator, liquidator,
rehabilitator or similar officer for it or for all or any material part of its
property; or any receiver, trustee, custodian, conservator, liquidator,
rehabilitator or similar officer is appointed without the application or consent
of such Person and the appointment continues undischarged or unstayed for 60
calendar days; or any proceeding under any Debtor Relief Law relating to any
such Person or to all or any material part of its property is instituted without
the consent of such Person and continues undismissed or unstayed for 60 calendar
days, or an order for relief is entered in any such proceeding; or

 

(g)           Inability to Pay Debts; Attachment.  (i) Any Loan Party becomes
unable or admits in writing its inability or fails generally to pay its debts as
they become due, or (ii) any writ or warrant of attachment or execution or
similar process is issued or levied against all or any material part of the
property of any such Person and is not released, vacated or fully bonded within
30 days after its issue or levy; or

 

(h)           Judgments.  There is entered against any Loan Party (i) one or
more final judgments or orders for the payment of money in an aggregate amount
(as to all such judgments

 

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or orders) exceeding the Threshold Amount (to the extent not covered by
independent third-party insurance as to which the insurer does not dispute
coverage), or (ii) any one or more non-monetary final judgments that have, or
could reasonably be expected to have, individually or in the aggregate, a
Material Adverse Effect and, in either case, (A) enforcement proceedings are
commenced by any creditor upon such judgment or order, or (B) there is a period
of 10 consecutive days during which a stay of enforcement of such judgment, by
reason of a pending appeal or otherwise, is not in effect; or

 

(i)            ERISA.  (1) An ERISA Event occurs with respect to a Pension Plan
or Multiemployer Plan which has resulted or could reasonably be expected to
result in liability of Borrower under Title IV of ERISA to the Pension Plan,
Multiemployer Plan or the PBGC in an aggregate amount in excess of the Threshold
Amount, or (2) Borrower or any ERISA Affiliate fails to pay when due, after the
expiration of any applicable grace period, any installment payment with respect
to its withdrawal liability under Section 4201 of ERISA under a Multiemployer
Plan in an aggregate amount in excess of the Threshold Amount; or

 

(j)            Invalidity of Loan Documents.  Any Loan Document or any provision
thereof, at any time after its execution and delivery and for any reason other
than as expressly permitted hereunder or thereunder or satisfaction in full of
all the Obligations, ceases to be in full force and effect; or any Loan Party or
any other Person contests in any manner the validity or enforceability of any
Loan Document or any provision thereof; or any Loan Party denies that it has any
or further liability or obligation under any Loan Document, or purports to
revoke, terminate or rescind any Loan Document or any provision thereof;

 

(k)           Change of Control.  There occurs any Change of Control;

 

(l)            Subordination.  (i)  The subordination provisions of the
documents evidencing or governing any subordinated Indebtedness (the
“Subordinated Provisions”) shall, in whole or in part, terminate, cease to be
effective or cease to be legally valid, binding and enforceable against any
holder of the applicable subordinated Indebtedness; or (ii) the Borrower or any
other Loan Party shall, directly or indirectly, disavow or contest in any manner
(A) the effectiveness, validity or enforceability of any of the Subordination
Provisions, (B) that the Subordination Provisions exist for the benefit of the
Administrative Agent and the Lenders or (C) that all payments of principal of or
premium and interest on the applicable subordinated Indebtedness, or realized
from the liquidation of any property of any Loan Party, shall be subject to any
of the Subordination Provisions.

 

(m)          Material Contracts.  (i)  Material Contract(s) constituting 20% or
more of Borrower’s total annual revenues shall be terminated or cancelled or
shall expire, or (ii) there shall occur any material default or breach in
respect of such Material Contract(s), and such failure continues after the
expiration of any grace period specified therein; provided, that the foregoing
events in this paragraph (m) shall not constitute an Event of Default under this
Agreement if (1) the Borrower is diligently attempting to replace such Material
Contract(s) with one or more equivalent agreements with parties and on terms
reasonably acceptable to the Agent and does so within 60 days after such
termination, cancellation, expiration, default or breach or (2) the Borrower
demonstrates and certifies in writing to the Agent’s reasonable satisfaction, on

 

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a pro forma basis thereafter, that notwithstanding such termination,
cancellation, expiration, default or breach, Borrower will remain in compliance
with all financial covenants under Section 6.12 of this Agreement thereafter.

 

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

 

(a)           declare the commitment of each Lender to make Loans to be
terminated, whereupon such commitments and obligation shall be terminated;

 

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

 

(c)           exercise on behalf of itself and the Lenders all rights and
remedies available to it, the Lenders under the Loan Documents;

 

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

 

8.03         Application of Funds.  After the exercise of remedies provided for
in Section 8.02 (or after the Loans have automatically become immediately due
and payable as set forth in the proviso to Section 8.02), any amounts received
on account of the Obligations shall be applied by Agent in the following order:

 

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

 

Second, to payment of that portion of the Obligations constituting fees,
indemnities and other amounts (other than principal and interest) payable to
Lenders (including fees, charges and disbursements of counsel to the respective
Lenders (including fees and time charges for attorneys who may be employees of
any Lender) and amounts payable under Article III), ratably among them in
proportion to the respective amounts described in this clause Second payable to
them;

 

Third, to payment of that portion of the Obligations constituting and interest
on the Loans and other Obligations, ratably among Lenders in proportion to the
respective amounts described in this clause Third payable to them;

 

Fourth, to payment of that portion of the Obligations constituting unpaid
principal of the Loans and amounts owing under Hedge Agreements and Cash
Management Agreements, ratably

 

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among Lenders, the Hedge Banks and the Cash Management Banks in proportion to
the respective amounts described in this clause Fourth held by them; and

 

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

 

ARTICLE IX.        ADMINISTRATIVE AGENT

 

9.01         Appointment and Authorization of Administrative Agent.  Each of the
Lenders hereby irrevocably appoints Bank of America to act on its behalf as
Administrative Agent hereunder and under the other Loan Documents and authorizes
Agent to take such actions on its behalf and to exercise such powers as are
delegated to Agent by the terms hereof and thereof, together with such actions
and powers as are reasonably incidental thereto.  The provisions of this
Article are solely for the benefit of Agent and the Lenders, and neither
Borrower nor any other Loan Party shall have rights as a third party beneficiary
of any of such provisions.

 

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

 

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

 

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

 

(b)           shall not have any duty to take any discretionary action or
exercise any discretionary powers, except discretionary rights and powers
expressly contemplated hereby or by the other Loan Documents that Agent is
required to exercise as directed in writing by the Required Lenders (or such
other number or percentage of the Lenders as shall be expressly provided for
herein or in the other Loan Documents), provided that Agent shall not be
required to take any action that, in its opinion or the opinion of its counsel,
may expose Agent to liability or that is contrary to any Loan Document or
applicable Law; and

 

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

 

(d)           Agent shall not be liable for any action taken or not taken by it
(i) with the consent or at the request of the Required Lenders (or such other
number or percentage of the

 

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Lenders as shall be necessary, or as Agent shall believe in good faith shall be
necessary, under the circumstances as provided in Sections 8.02 and 11.01) or
(ii) in the absence of its own gross negligence or willful misconduct.  Agent
shall be deemed not to have knowledge of any Default unless and until written
notice describing such Default is given to Agent by Borrower or a Lender.  Agent
shall not be responsible for or have any duty to ascertain or inquire into
(i) any statement, warranty or representation made in or in connection with this
Agreement or any other Loan Document, (ii) the contents of any certificate,
report or other document delivered hereunder or thereunder or in connection
herewith or therewith, (iii) the performance or observance of any of the
covenants, agreements or other terms or conditions set forth herein or therein
or the occurrence of any Default, (iv) the validity, enforceability,
effectiveness or genuineness of this Agreement, any other Loan Document or any
other agreement, instrument or document or (v) the satisfaction of any condition
set forth in Article IV or elsewhere herein, other than to confirm receipt of
items expressly required to be delivered to Agent.

 

9.04         Reliance by Administrative Agent.  Agent shall be entitled to rely
upon, and shall not incur any liability for relying upon, any notice, request,
certificate, consent, statement, instrument, document or other writing
(including any electronic message, Internet or intranet website posting or other
distribution) believed by it to be genuine and to have been signed, sent or
otherwise authenticated by the proper Person.  Agent also may rely upon any
statement made to it orally or by telephone and believed by it to have been made
by the proper Person, and shall not incur any liability for relying thereon.  In
determining compliance with any condition hereunder to the making of a Loan that
by its terms must be fulfilled to the satisfaction of a Lender, Agent may
presume that such condition is satisfactory to such Lender unless Agent shall
have received notice to the contrary from such Lender prior to the making of
such Loan.  Agent may consult with legal counsel (who may be counsel for
Borrower), independent accountants and other experts selected by it, and shall
not be liable for any action taken or not taken by it in accordance with the
advice of any such counsel, accountants or experts.

 

9.05         Delegation of Duties.  Agent may perform any and all of its duties
and exercise its rights and powers hereunder or under any other Loan Document by
or through any one or more sub-agents appointed by Agent.  Agent and any such
sub-agent may perform any and all of its duties and exercise its rights and
powers by or through their respective Related Parties.  The exculpatory
provisions of this Article shall apply to any such sub-agent and to the Related
Parties of Agent 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 Agent.

 

9.06         Resignation of Agent.  Agent may at any time give notice of its
resignation to Lenders and Borrower.  Upon receipt of any such notice of
resignation, the Required Lenders shall have the right, in consultation with
Borrower, to appoint a successor, which shall be a bank with an office in the
United States, or an Affiliate of any such bank with an office in the United
States.  If no such successor shall have been so appointed by the Required
Lenders and shall have accepted such appointment within 30 days after the
retiring Agent gives notice of its resignation, then the retiring Agent may on
behalf of Lenders, appoint a successor Agent meeting the qualifications set
forth above; provided that if Agent shall notify Borrower and the Lenders that
no qualifying Person has accepted such appointment, then such resignation shall
nonetheless become effective in accordance with such notice and (1) the retiring
Agent shall be

 

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discharged from its duties and obligations hereunder and under the other Loan
Documents and (2) all payments, communications and determinations provided to be
made by, to or through Agent shall instead be made by or to each Lender
directly, until such time as the Required Lenders appoint a successor Agent as
provided for above in this Section.  Upon the acceptance of a successor’s
appointment as Agent hereunder, such successor shall succeed to and become
vested with all of the rights, powers, privileges and duties of the retiring (or
retired) Agent, and the retiring Agent shall be discharged from all of its
duties and obligations hereunder or under the other Loan Documents (if not
already discharged therefrom as provided above in this Section).  The fees
payable by Borrower to a successor Agent shall be the same as those payable to
its predecessor unless otherwise agreed between Borrower and such successor. 
After the retiring Agent’s resignation hereunder and under the other Loan
Documents, the provisions of this Article and Section 11.04 shall continue in
effect for the benefit of such retiring Agent, its sub-agents and their
respective Related Parties in respect of any actions taken or omitted to be
taken by any of them while the retiring Administrative Agent was acting as
Administrative Agent.

 

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

 

9.08         No Other Duties, Etc.  Anything herein to the contrary
notwithstanding, no Lender holding a title listed on the cover page hereof shall
have any powers, duties or responsibilities under this Agreement or any of the
other Loan Documents, except in its capacity, as applicable, as Agent or a
Lender hereunder.

 

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

 

(a)           to file and prove a claim for the whole amount of the principal
and interest owing and unpaid in respect of the Loans and all other Obligations
that are owing and unpaid and to file such other documents as may be necessary
or advisable in order to have the claims of Lenders and Agent (including any
claim for the reasonable compensation, expenses, disbursements and advances of
Lenders and Agent and their respective agents and counsel and all other amounts
due Lenders and Agent under Sections 2.09 and 11.04) allowed in such judicial
proceeding; and

 

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

 

and any custodian, receiver, assignee, trustee, liquidator, sequestrator or
other similar official in any such judicial proceeding is hereby authorized by
each Lender to make such payments to Agent and, in the event that Agent shall
consent to the making of such payments directly to Lenders, to pay to Agent any
amount due for the reasonable compensation, expenses, disbursements and advances
of Agent and its agents and counsel, and any other amounts due Agent under
Sections 2.09 and 11.04.  Nothing contained herein shall be deemed to authorize
Agent to authorize or consent to or accept or adopt on behalf of any Lender any
plan of reorganization, arrangement, adjustment or composition affecting the
Obligations or the rights of any Lender or to authorize Agent to vote in respect
of the claim of any Lender in any such proceeding.

 

9.10         Guaranty Matters.  Each Lender hereby irrevocably authorizes Agent,
at its option and in its discretion, to release any Guarantor from its
obligations under the Guaranty if such Person ceases to be a Subsidiary as a
result of a transaction permitted hereunder.  Upon request by Agent at any time,
each Lender will confirm in writing Agent’s authority to release any Guarantor
from its obligations under the Guaranty pursuant to this Section 9.10.

 

ARTICLE X.         CONTINUING GUARANTY

 

10.01       Guaranty.  Each Guarantor hereby absolutely and unconditionally
guarantees, jointly and severally, as a guaranty of payment and performance and
not merely as a guaranty of collection, prompt payment when due, whether at
stated maturity, by required prepayment, upon acceleration, demand or otherwise,
and at all times thereafter, of any and all of the Obligations, whether for
principal, interest, premiums, fees, indemnities, damages, costs, expenses or
otherwise, of the Borrower and each other Guarantor to the Guaranteed Parties,
arising hereunder and under the other Loan Documents (including all renewals,
extensions, amendments, refinancings and other modifications thereof and all
costs, attorneys’ fees and expenses incurred by the Guaranteed Parties in
connection with the collection or enforcement thereof).  The Administrative
Agent’s books and records showing the amount of the Obligations shall be
admissible in evidence in any action or proceeding, and shall be binding upon
each Guarantor, and conclusive (absent manifest error) for the purpose of
establishing the amount of the Obligations.  This Guaranty shall not be affected
by the genuineness, validity, regularity or enforceability of the Obligations or
any instrument or agreement evidencing any Obligations, or by the existence,
validity, enforceability, perfection, non-perfection or extent of any collateral
(if any) therefor, or by any fact or circumstance relating to the Obligations
which might otherwise constitute a defense to the obligations of any Guarantor
under this Guaranty, and each Guarantor hereby irrevocably waives any defenses
it may now have or hereafter acquire in any way relating to any or all of the
foregoing.

 

10.02       Rights of Lenders.  Each Guarantor consents and agrees that the
Guaranteed Parties may, at any time and from time to time, without notice or
demand, and without affecting the enforceability or continuing effectiveness
hereof:  (a) amend, extend, renew, compromise, discharge, accelerate or
otherwise change the time for payment or the terms of the Obligations or

 

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any part thereof; (b) take, hold, exchange, enforce, waive, release, fail to
perfect, sell, or otherwise dispose of any security (if any) or other guaranty
for the payment of this Guaranty or any Obligations; (c) apply such security (if
any) and direct the order or manner of sale thereof as the Administrative Agent
and the Lenders in their sole discretion may determine; and (d) release or
substitute one or more of any endorsers or other guarantors of any of the
Obligations.  Without limiting the generality of the foregoing, each Guarantor
consents to the taking of, or failure to take, any action which might in any
manner or to any extent vary the risks of any Guarantor under this Guaranty or
which, but for this provision, might operate as a discharge of any Guarantor.

 

10.03       Certain Waivers.  Each Guarantor waives (a) any defense arising by
reason of any disability or other defense of the Borrower or any other
guarantor, or the cessation from any cause whatsoever (including any act or
omission of any Guaranteed Party) of the liability of the Borrower or any other
guarantor; (b) any defense based on any claim that any Guarantor’s obligations
exceed or are more burdensome than those of the Borrower; (c) the benefit of any
statute of limitations affecting any Guarantor’s liability hereunder; (d) any
right to proceed against any Loan Party, proceed against or exhaust any security
or other guaranty for the Obligations, or pursue any other remedy in the power
of any Guaranteed Party whatsoever; (e) any benefit of and any right to
participate in any security or other guaranty now or hereafter held by any
Guaranteed Party; and (f) to the fullest extent permitted by law, any and all
other defenses or benefits that may be derived from or afforded by applicable
law limiting the liability of or exonerating guarantors or sureties.  Each
Guarantor expressly waives all setoffs and counterclaims and all presentments,
demands for payment or performance, notices of nonpayment or nonperformance,
protests, notices of protest, notices of dishonor and all other notices or
demands of any kind or nature whatsoever with respect to the Obligations, and
all notices of acceptance of this Guaranty or of the existence, creation or
incurrence of new or additional Obligations.

 

10.04       Obligations Independent.  The obligations of each Guarantor
hereunder are those of primary obligor, and not merely as surety, and are
independent of the Obligations and the obligations of any other guarantor, and a
separate action may be brought against any Guarantor to enforce this Guaranty
whether or not the Borrower or any other person or entity is joined as a party.

 

10.05       Subrogation.  No Guarantor shall exercise any right of subrogation,
contribution, indemnity, reimbursement or similar rights with respect to any
payments it makes under this Guaranty until all of the Obligations (other than
unasserted contingent indemnification obligations) and any amounts payable under
this Guaranty have been indefeasibly paid and performed in full and the
Commitments and the Facilities are terminated.  If any amounts are paid to any
Guarantor in violation of the foregoing limitation, then such amounts shall be
held in trust for the benefit of the Guaranteed Parties and shall forthwith be
paid to the Administrative Agent for the benefit of the Guaranteed Parties to
reduce the amount of the Obligations, whether matured or unmatured.

 

10.06       Termination; Reinstatement.  This Guaranty is a continuing and
irrevocable guaranty of all Obligations now or hereafter existing and shall
remain in full force and effect

 

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until all Obligations and any other amounts payable under this Guaranty are
indefeasibly paid in full in cash and the Commitments and the Facilities with
respect to the Obligations are terminated.  Notwithstanding the foregoing, this
Guaranty shall continue in full force and effect or be revived, as the case may
be, if any payment by or on behalf of the Borrower or any Guarantor is made, or
any of the Guaranteed Parties exercises its right of setoff, in respect of the
Obligations and such payment or the proceeds of such setoff or any part thereof
is subsequently invalidated, declared to be fraudulent or preferential, set
aside or required (including pursuant to any settlement entered into by any of
the Guaranteed Parties in their discretion) to be repaid to a trustee, receiver
or any other party, in connection with any proceeding under any Debtor Relief
Laws or otherwise, all as if such payment had not been made or such setoff had
not occurred and whether or not the Guaranteed Parties are in possession of or
have released this Guaranty and regardless of any prior revocation, rescission,
termination or reduction.  The obligations of each Guarantor under this
paragraph shall survive termination of this Guaranty.

 

10.07       Subordination.  Each Guarantor hereby subordinates the payment of
all obligations and indebtedness of the Borrower or any other Loan Party owing
to such Guarantor, whether now existing or hereafter arising, including but not
limited to any obligation of any Loan Party to such Guarantor as subrogee of the
Guaranteed Parties or resulting from a Guarantor’s performance under this
Guaranty, to the indefeasible payment in full in cash of all Obligations.  If
the Guaranteed Parties so request, any such obligation or indebtedness of any
Loan Party to a Guarantor shall be enforced and performance received by such
Guarantor as trustee for the Guaranteed Parties and the proceeds thereof shall
be paid over to the Agent for the benefit of the Guaranteed Parties on account
of the Obligations, but without reducing or affecting in any manner the
liability of any Guarantor under this Guaranty.

 

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

 

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

 

10.10       Rights of Contribution.

 

(a)           The Guarantors hereby agree, as between themselves, that if any
Guarantor shall become an Excess Funding Guarantor (as defined below) by reason
of the payment by such Guarantor of any Obligations, each other Guarantor shall,
on demand of such Excess Funding Guarantor (but subject to the next sentence),
pay to such Excess Funding

 

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Guarantor an amount equal to such Guarantor’s Pro Rata Share (as defined below
and determined, for this purpose, without reference to the properties, debts and
liabilities of such Excess Funding Guarantor) of the Excess Payment (as defined
below) in respect of such Obligations. The payment obligation of a Guarantor to
any Excess Funding Guarantor under this Section shall be subordinate and subject
in right of payment to the prior payment in full of the obligations of such
Guarantor under the other provisions of this Article and of all other
Obligations, and such Excess Funding Guarantor shall not exercise any right or
remedy with respect to such excess until payment and satisfaction in full of all
of the Obligations.

 

(b)           For purposes of this Section, (i) “Excess Funding Guarantor”
means, in respect of any Obligations, a Guarantor that has paid an amount in
excess of its Pro Rata Share of such Obligations, (ii) “Excess Payment” means,
in respect of any Guaranteed Obligations, the amount paid by an Excess Funding
Guarantor in excess of its Pro Rata Share of such Obligations and (iii) “Pro
Rata Share” means, for any Guarantor, the ratio (expressed as a percentage) of
(x) the amount by which the aggregate present fair saleable value of all
properties of such Guarantor (excluding any shares of stock of any other
Guarantor) exceeds the amount of all the debts and liabilities of such Guarantor
(including contingent, subordinated, unmatured and unliquidated liabilities, but
excluding the obligations of such Guarantor hereunder and any obligations of any
other Guarantor that have been guaranteed by such Guarantor) to (y) the amount
by which the aggregate fair saleable value of all properties of all of the
Guarantors exceeds the amount of all the debts and liabilities (including
contingent, subordinated, unmatured and unliquidated liabilities, but excluding
the obligations of the Guarantors hereunder and under the other Loan Documents)
of all of the Guarantors, determined (A) with respect to any Guarantor that is a
party hereto on the Closing Date, as of the Closing Date, and (B) with respect
to any other Guarantor, as of the date such Guarantor becomes a Guarantor
hereunder.

 

10.11       General Limitation on Guarantee Obligations.  In any action or
proceeding involving any state corporate law, or any state or Federal
bankruptcy, insolvency, reorganization or other law affecting the rights of
creditors generally, if the obligations of any Guarantor under Section 10.01
would otherwise, taking into account the provisions of Section 10.10, be held or
determined to be void, invalid or unenforceable, or subordinated to the claims
of any other creditors, on account of the amount of its liability under
Section 10.01, then, notwithstanding any other provision hereof to the contrary,
the amount of such liability shall, without any further action by such Borrower,
any Lender, the Administrative Agent or any other Person, be automatically
limited and reduced to the highest amount that is valid and enforceable and not
subordinated to the claims of other creditors as determined in such action or
proceeding.

 

10.12       Joint and Several Obligations.  Each Guarantor hereby accepts joint
and several liability under the Loan Documents in consideration of the financial
accommodations to be provided by the Lenders and the Administrative Agent under
the Loan Documents, for the mutual benefit, directly and indirectly, of each
Guarantor and in consideration of the undertakings of the other Guarantors to
accept joint and several liability for the Obligations.  Each Guarantor
represents and warrants to the Administrative Agent and Lenders that such
Guarantor is currently informed of the financial condition of all the Loan
Parties and of all other circumstances which a diligent inquiry would reveal and
which bear upon the risk of nonpayment of the Obligations.  Each Guarantor
further represents and warrants to the

 

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Administrative Agent and Lenders that such Guarantor has read and fully
understands the terms and conditions of the Loan Documents.

 

ARTICLE XI.        MISCELLANEOUS

 

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

 

(a)           waive any condition set forth in Section 4.01(a) without the
written consent of each Lender; provided, however, in the sole discretion of
Agent, only a waiver by Agent shall be required with respect to immaterial
matters or items specified in Section 4.01(a) (iii) or (iv)  with respect to
which Borrower has given assurances satisfactory to Agent that such items shall
be delivered promptly following the Closing Date;

 

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

 

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

 

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

 

(e)           change Section 2.13 or Section 8.03 in a manner that would alter
the pro rata sharing of payments required thereby without the written consent of
each Lender;

 

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

 

(g)  release any Guarantor from the Guaranty except in accordance with the terms
of any Loan Document, without the written consent of each Lender;

 

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and, provided further, that (i) no amendment, waiver or consent shall, unless in
writing and signed by Agent in addition to the Lenders required above, affect
the rights or duties of Agent under this Agreement or any other Loan Document. 
Notwithstanding anything to the contrary herein, no Defaulting Lender shall have
any right to approve or disapprove any amendment, waiver or consent hereunder,
except that the Commitment of such Lender may not be increased or extended
without the consent of such Lender.

 

11.02       Notices; Effectiveness; Electronic Communications.

 

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

 

(i)            if to any Loan Party or Agent to the address, telecopier number,
electronic mail address or telephone number specified for such Person on
Schedule 10.02 ; and

 

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

 

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

 

(b)           Electronic Communications.  Notices and other communications to
Lenders hereunder may be delivered or furnished by electronic communication
(including e-mail and Internet or intranet websites) pursuant to procedures
approved by Agent, provided that the foregoing shall not apply to notices to any
Lender pursuant to Article II if such Lender has notified the Agent that it is
incapable of receiving notices under such Article by electronic communication. 
Agent or Borrower may, in its discretion, agree to accept notices and other
communications to it hereunder by electronic communications pursuant to
procedures approved by it, provided that approval of such procedures may be
limited to particular notices or communications.  Unless Agent otherwise
prescribes, (i) notices and other communications sent to an e-mail address shall
be deemed received upon the sender’s receipt of an acknowledgement from the
intended recipient (such as by the “return receipt requested” function, as
available, return e-mail or other written acknowledgement), provided that if
such notice or other communication is not sent during the normal business hours
of the recipient, such notice or communication shall be deemed to have been sent
at the opening of business on the next business day for the recipient, and
(ii) notices or communications posted to an Internet or intranet website shall
be deemed received upon the deemed receipt by the intended recipient at its
e-mail

 

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address as described in the foregoing clause (i) of notification that such
notice or communication is available and identifying the website address
therefor.

 

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

 

(d)           Change of Address, Etc.  Each of Borrower, any other Loan Party
and Agent may change its address, telecopier or telephone number for notices and
other communications hereunder by notice to the other parties hereto.  Each
Lender may change its address, telecopier or telephone number for notices and
other communications hereunder by notice to Borrower and Agent.  In addition,
each Lender agrees to notify Agent from time to time to ensure that Agent has on
record (i) an effective address, contact name, telephone number, telecopier
number and electronic mail address to which notices and other communications may
be sent and (ii) accurate wire instructions for such Lender.  Furthermore, each
Public Lender agrees to cause at least one individual at or on behalf of such
Public Lender to at all times have selected the “Private Side Information” or
similar designation on the content declaration screen of the Platform in order
to enable such Public Lender or its delegate, in accordance with such Public
Lender’s compliance procedures and applicable Law, including United States
Federal and state securities Laws, to make reference to Borrower Materials that
are not made available through the “Public Side Information” portion of the
Platform and that may contain material non-public information with respect to
the Borrower or its securities for purposes of United States Federal or state
securities laws.

 

(e)           Reliance by Agent and Lenders.  Agent and Lenders shall be
entitled to rely and act upon any notices (including telephonic Committed Loan
Notices) purportedly given by or on behalf of Borrower or any other Loan Party
even if (i) such notices were not made in a manner specified herein, were
incomplete or were not preceded or followed by any other form of notice
specified herein, or (ii) the terms thereof, as understood by the recipient,
varied from any confirmation thereof.  Borrower shall indemnify Agent, each
Lender and the Related Parties of

 

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each of them from all losses, costs, expenses and liabilities resulting from the
reliance by such Person on each notice purportedly given by or on behalf of any
Loan Party.  All telephonic notices to and other telephonic communications with
Agent may be recorded by Agent, and each of the parties hereto hereby consents
to such recording.

 

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

 

11.04       Expenses; Indemnity; Damage Waiver.

 

(a)           Costs and Expenses.  Borrower shall pay (i) all reasonable
out-of-pocket expenses incurred by Agent and its Affiliates (including the
reasonable fees, charges and disbursements of counsel for Agent), in connection
with the syndication of the credit facilities provided for herein, the
preparation, negotiation, execution, delivery and administration of this
Agreement and the other Loan Documents or any amendments, modifications or
waivers of the provisions hereof or thereof (whether or not the transactions
contemplated hereby or thereby shall be consummated), and (ii) all out-of-pocket
expenses incurred by Agent or any Lender (including the fees, charges and
disbursements of any counsel for Agent or any Lender), and shall pay all fees
and time charges for attorneys who may be employees of Agent or any Lender, in
connection with the enforcement or protection of its rights (A) in connection
with this Agreement and the other Loan Documents, including its rights under
this Section, or (B) in connection with the Loans made hereunder, including all
such out-of-pocket expenses incurred during any workout, restructuring or
negotiations in respect of such Loans.

 

(b)           Indemnification by Borrower.  Borrower shall indemnify Agent (and
any sub-agent thereof), 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,
liabilities and related expenses (including the fees, charges and disbursements
of any counsel for any Indemnitee), and shall indemnify and hold harmless each
Indemnitee from all fees and time charges and disbursements for attorneys who
may be employees of any Indemnitee, incurred by any Indemnitee or asserted
against any Indemnitee by any third party or by Borrower or any other Loan Party
arising out of, in connection with, or as a result of (i) the execution or
delivery of this Agreement, any other Loan Document or any agreement or
instrument contemplated hereby or thereby, the performance by the parties hereto
of their respective obligations hereunder or thereunder, or the consummation of
the transactions contemplated hereby or thereby, or, in the case of Agent (and
any sub-agent thereof) and its Related Parties only, the administration of this
Agreement and the other Loan Documents, (ii) any Loan or the use or proposed use
of the proceeds therefrom, (iii) any actual or alleged presence or release of
Hazardous Materials on or from any property owned or operated by Borrower or any
of its Subsidiaries, or any Environmental Liability related in any way to
Borrower or any of its Subsidiaries, or (iv) any actual or prospective claim,
litigation,

 

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investigation or proceeding relating to any of the foregoing, whether based on
contract, tort or any other theory, whether brought by a third party or by
Borrower or any other Loan Party, and regardless of whether any Indemnitee is a
party thereto IN ALL CASES, WHETHER OR NOT CAUSED BY OR ARISING, IN WHOLE OR IN
PART, OUT OF THE COMPARATIVE, CONTRIBUTORY OR SOLE NEGLIGENCE OF THE INDEMNITEE;
provided that such indemnity shall not, as to any Indemnitee, be available to
the extent that such losses, claims, damages, liabilities or related expenses
(x) are determined by a court of competent jurisdiction by final and
nonappealable judgment to have resulted from the gross negligence or willful
misconduct of such Indemnitee or (y) result from a claim brought by Borrower or
any other Loan Party against an Indemnitee for breach in bad faith of such
Indemnitee’s obligations hereunder or under any other Loan Document, if Borrower
or such Loan Party has obtained a final and nonappealable judgment in its favor
on such claim as determined by a court of competent jurisdiction.

 

(c)           Reimbursement by Lenders.  To the extent that Borrower for any
reason fails to indefeasibly pay any amount required under
subsection (a) or (b) of this Section to be paid by it to Agent (or any
sub-agent thereof) or any Related Party of any of the foregoing, each Lender
severally agrees to pay to Agent (or any such sub-agent) or such Related Party,
as the case may be, such Lender’s Applicable Percentage (determined as of the
time that the applicable unreimbursed expense or indemnity payment is sought) of
such unpaid amount, provided that the unreimbursed expense or indemnified loss,
claim, damage, liability or related expense, as the case may be, was incurred by
or asserted against Agent (or any such sub-agent) in its capacity as such, or
against any Related Party of any of the foregoing acting for Agent (or any such
sub-agent) in connection with such capacity.  The obligations of the Lenders
under this subsection (c) are subject to the provisions of Section 2.12(d).

 

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

 

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

 

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

 

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

 

11.06       Successors and Assigns.

 

(a)           Successors and Assigns Generally.  The provisions of this
Agreement shall be binding upon and inure to the benefit of the parties hereto
and their respective successors and assigns permitted hereby, except that
neither Borrower nor any other Loan Party may assign or otherwise transfer any
of its rights or obligations hereunder without the prior written consent of
Agent and each Lender and no Lender may assign or otherwise transfer any of its
rights or obligations hereunder except (i) to an assignee in accordance with the
provisions of subsection (b) of this Section, (ii) by way of participation in
accordance with the provisions of subsection (d) of this Section, or (iii) by
way of pledge or assignment of a security interest subject to the restrictions
of subsection (f)  of this Section (and any other attempted assignment or
transfer by any party hereto shall be null and void).  Nothing in this
Agreement, expressed or implied, shall be construed to confer upon any Person
(other than the parties hereto, their respective successors and assigns
permitted hereby, Participants to the extent provided in subsection (d) of this
Section and, to the extent expressly contemplated hereby, the Related Parties of
each of Agent and the Lenders) any legal or equitable right, remedy or claim
under or by reason of this Agreement.

 

(b)           Assignments by Lenders.  Any Lender may at any time assign to one
or more assignees all or a portion of its rights and obligations under this
Agreement (including all or a portion of its Commitments and the Loans at the
time owing to it); provided that any such assignment shall be subject to the
following conditions:

 

(i)            Minimum Amounts

 

(A)  in the case of an assignment of the entire remaining amount of the
assigning Lender’s Commitment under any Facility and the Loans at the time owing
to it under such Facility or in the case of an assignment to a Lender or an
Affiliate of a Lender no minimum amount need be assigned; and

 

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(B) in any case not described in subsection (b)(i)(A) of this Section,  the
aggregate amount of the Commitment (which for this purpose includes Loans
outstanding thereunder) or, if the Commitment is not then in effect, the
principal outstanding balance of the Loans of the assigning Lender subject to
each such assignment, determined as of the date the Assignment and Assumption
with respect to such assignment is delivered to Agent or, if “Trade Date” is
specified in the Assignment and Assumption, as of the Trade Date, shall not be
less than $5,000,000, in the case of any assignment in respect of the Revolving
Credit Facility, or $1,000,000, in the case of any assignment in respect of the
Term Facility unless each of Agent and, so long as no Event of Default has
occurred and is continuing, Borrower otherwise consents (each such consent not
to be unreasonably withheld or delayed); provided, however, that concurrent
assignments to members of an Assignee Group and concurrent assignments from
members of an Assignee Group to a single Eligible Assignee (or to an Eligible
Assignee and members of its Assignee Group) will be treated as a single
assignment for purposes of determining whether such minimum amount has been met;

 

(ii)           Proportionate Amounts.  Each partial assignment shall be made as
an assignment of a proportionate part of all the assigning Lender’s rights and
obligations under this Agreement with respect to the Loans or the Commitment
assigned, except that this clause (ii) shall not prohibit any Lender from
assigning all or a portion of its rights and obligations among separate
Facilities on a non-pro rata basis;

 

(iii)          Required Consents.  No consent shall be required for any
assignment except to the extent required by subsection (b)(i)(B) of this
Section and, in addition:

 

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

 

(B)           the consent of Agent (such consent not to be unreasonably withheld
or delayed) shall be required for assignments in respect of (1) any Term
Commitment or Revolving Credit Commitment if such assignment is to a Person that
is not a Lender with a Commitment in respect of the applicable Facility, or an
Affiliate of such Lender or (2) any Term Loan to a Person that is not a Lender;
or an Affiliate of a Lender.

 

(iv)          Assignment and Assumption. The parties to each assignment shall
execute and deliver to Agent an Assignment and Assumption, together with a
processing and recordation fee in the amount of $3,500.00; provided, however,
that the Agent may, in its sole discretion, elect to waive such processing and
recordation fee in the case of any assignment. The assignee, if it is not a
Lender, shall deliver to Agent an Administrative Questionnaire.

 

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(v)           No Assignment to Borrower.  No such assignment shall be made to
Borrower or any of Borrower’s Affiliates or Subsidiaries.

 

(vi)          No Assignment to Natural Persons.  No such assignment shall be
made to a natural person.

 

Subject to acceptance and recording thereof by Agent pursuant to subsection
(c) of this Section, from and after the effective date specified in each
Assignment and Assumption, the assignee thereunder shall be a party to this
Agreement and, to the extent of the interest assigned by such Assignment and
Assumption, have the rights and obligations of a Lender under this Agreement,
and the assigning Lender thereunder shall, to the extent of the interest
assigned by such Assignment and Assumption, be released from its obligations
under this Agreement (and, in the case of an Assignment and Assumption covering
all of the assigning Lender’s rights and obligations under this Agreement, such
Lender shall cease to be a party hereto) but shall continue to be entitled to
the benefits of Sections 3.01, 3.04, 3.05,  and 10.04 with respect to facts and
circumstances occurring prior to the effective date of such assignment.  Upon
request, Borrower (at its expense) shall execute and deliver a Note to the
assignee Lender.  Any assignment or transfer by a Lender of rights or
obligations under this Agreement that does not comply with this subsection shall
be treated for purposes of this Agreement as a sale by such Lender of a
participation in such rights and obligations in accordance with subsection
(d) of this Section.

 

(c)           Register.  Agent, acting solely for this purpose as an agent of
Borrower, shall maintain at Administrative Agent’s Office a copy of each
Assignment and Assumption delivered to it and a register for the recordation of
the names and addresses of the Lenders, and the Commitments of, and principal
amounts of the Loans owing to, each Lender pursuant to the terms hereof from
time to time (the “Register”).  The entries in the Register shall be conclusive,
and Borrower, Agent and the Lenders may treat each Person whose name is recorded
in the Register pursuant to the terms hereof as a Lender hereunder for all
purposes of this Agreement, notwithstanding notice to the contrary.  The
Register shall be available for inspection by Borrower and any Lender, at any
reasonable time and from time to time upon reasonable prior notice.

 

(d)           Participations.  Any Lender may at any time, without the consent
of, or notice to, Borrower or Agent, sell participations to any Person (other
than a natural person or Borrower or any of Borrower’s Affiliates or
Subsidiaries) (each, a “Participant”) in all or a portion of such Lender’s
rights and/or obligations under this Agreement (including all or a portion of
its Commitment and/or the Loans owing to it); provided that (i) such Lender’s
obligations under this Agreement shall remain unchanged, (ii) such Lender shall
remain solely responsible to the other parties hereto for the performance of
such obligations and (iii) Borrower, Agent and the 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, waiver or other
modification described in the first proviso to Section 11.01 that affects such
Participant.

 

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Subject to subsection (e) of this Section, Borrower agrees that each Participant
shall be entitled to the benefits of Sections 3.01, 3.04 and 3.05 to the same
extent as if it were a Lender and had acquired its interest by assignment
pursuant to subsection (b) of this Section.  To the extent permitted by law,
each Participant also shall be entitled to the benefits of Section 11.08 as
though it were a Lender, provided such Participant agrees to be subject to
Section 2.13 as though it were a Lender.

 

(e)           Limitations upon Participant Rights.  A Participant shall not be
entitled to receive any greater payment under Section 3.01 or 3.04 than the
applicable Lender would have been entitled to receive with respect to the
participation sold to such Participant, unless the sale of the participation to
such Participant is made with Borrower’s prior written consent.

 

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

 

(g)           Electronic Execution of Assignments.  The words “execution,”
“signed,” “signature,” and words of like import in any Assignment and Assumption
shall be deemed to include electronic signatures or the keeping of records in
electronic form, each of which shall be of the same legal effect, validity or
enforceability as a manually executed signature or the use of a paper-based
recordkeeping system, as the case may be, to the extent and as provided for in
any applicable law, including the Federal Electronic Signatures in Global and
National Commerce Act, the New York State Electronic Signatures and Records Act,
or any other similar state laws based on the Uniform Electronic Transactions
Act.

 

(h)           Deemed Consent of Borrower.  If the consent of Borrower to an
assignment to an Eligible Assignee is required hereunder (including a consent to
an assignment which does not meet the minimum assignment threshold specified in
Section 11.06(b)(i)(B)), Borrower shall be deemed to have given its consent five
Business Days after the date notice thereof has been delivered to Borrower by
the assigning Lender (through Agent) unless such consent is expressly refused by
Borrower prior to such fifth Business Day.

 

11.07       Treatment of Certain Information; Confidentiality.  Each of Agent
and the Lenders agrees to maintain the confidentiality of the Information (as
defined below), except that Information may be disclosed (a) to its Affiliates
and to its and its Affiliates’ respective partners, directors, officers,
employees, agents, advisors and representatives (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,
purporting to have jurisdiction over it (including any self-regulatory
authority, such as the National Association of Insurance Commissioners), (c) to
the extent required by applicable laws or regulations or by any subpoena or
similar legal process, (d) to any other party hereto, (e) in connection with the
exercise of any remedies hereunder or under any other Loan Document or any
action or proceeding relating to this Agreement or any other Loan

 

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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 Borrower and its obligations, (g) with the
consent of Borrower or (h) to the extent such Information (x) becomes publicly
available other than as a result of a breach of this Section or (y) becomes
available to Agent, any Lender or any of their respective Affiliates on a
nonconfidential basis from a source other than Borrower.  For purposes of this
Section, “Information” means all information received from Borrower or any
Subsidiary relating to Borrower or any Subsidiary or any of their respective
businesses, other than any such information that is available to Agent or any
Lender on a nonconfidential basis prior to disclosure by Borrower or any
Subsidiary, provided that, in the case of information received from Borrower or
any Subsidiary after the date hereof, such information is clearly identified at
the time of delivery as confidential.  The parties hereto agree that financial
statements of Borrower that are not available to Agent or any Lender on a
nonconfidential basis prior to disclosure by Borrower or any Subsidiary shall be
deemed 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 of Agent and the Lenders
acknowledges that (a) the Information may include material non-public
information concerning Borrower or a Subsidiary, as the case may be, (b) it has
developed compliance procedures regarding the use of material non-public
information and (c) it will handle such material non-public information in
accordance with applicable Law, including Federal and state securities Laws.

 

11.08       Right of Setoff.  If an Event of Default shall have occurred and be
continuing, each Lender and each of their respective Affiliates is hereby
authorized at any time and from time to time, to the fullest extent permitted by
applicable law, to set off and apply any and all deposits (general or special,
time or demand, provisional or final, in whatever currency, but excluding
accounts used exclusively for payroll or customer escrows and trust accounts) at
any time held and other obligations (in whatever currency) at any time owing by
such Lender or any such Affiliate to or for the credit or the account of
Borrower or any other Loan Party against any and all of the obligations of
Borrower or such Loan Party now or hereafter existing under this Agreement or
any other Loan Document to such Lender or any such Affiliate, irrespective of
whether or not such Lender shall have made any demand under this Agreement or
any other Loan Document and although such obligations of Borrower or such Loan
Party may be contingent or unmatured or are owed to a branch or office of such
Lender different from the branch or office holding such deposit or obligated on
such indebtedness.  The rights of each Lender and their respective Affiliates
under this Section are in addition to other rights and remedies (including other
rights of setoff) that such Lender or its Affiliates may have.  Each Lender
agrees to notify Borrower and Agent promptly after any such setoff and
application, provided that the failure to give such notice shall not affect the
validity of such setoff and application.

 

11.09       Interest Rate Limitation.  Notwithstanding anything to the contrary
contained in any Loan Document, the interest paid or agreed to be paid under the
Loan Documents shall not

 

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exceed the maximum rate of non-usurious interest permitted by applicable Law
(the “Maximum Rate”).  If Agent or any Lender shall receive interest in an
amount that exceeds the Maximum Rate, the excess interest shall be applied to
the principal of the Loans or, if it exceeds such unpaid principal, refunded to
Borrower.  In determining whether the interest contracted for, charged, or
received by Agent or a Lender exceeds the Maximum Rate, such Person may, to the
extent permitted by applicable Law, (a) characterize any payment that is not
principal as an expense, fee, or premium rather than interest, (b) exclude
voluntary prepayments and the effects thereof, and (c) amortize, prorate,
allocate, and spread in equal or unequal parts the total amount of interest
throughout the contemplated term of the Obligations hereunder.

 

11.10       Counterparts; Integration; Effectiveness.  This Agreement may be
executed in counterparts (and by different parties hereto in different
counterparts), each of which shall constitute an original, but all of which when
taken together shall constitute a single contract.  This Agreement and the other
Loan Documents constitute the entire contract among the parties relating to the
subject matter hereof and supersede any and all previous agreements and
understandings, oral or written, relating to the subject matter hereof.  Except
as provided in Section 4.01, this Agreement shall become effective when it shall
have been executed by Agent and when Agent shall have received counterparts
hereof that, when taken together, bear the signatures of each of the other
parties hereto.  Delivery of an executed counterpart of a signature page of this
Agreement by telecopy shall be effective as delivery of a manually executed
counterpart of this Agreement.

 

11.11       Survival of Representations and Warranties.  All representations and
warranties made hereunder and in any other Loan Document or other document
delivered pursuant hereto or thereto or in connection herewith or therewith
shall survive the execution and delivery hereof and thereof.  Such
representations and warranties have been or will be relied upon by Agent and
each Lender, regardless of any investigation made by Agent or any Lender or on
their behalf and notwithstanding that Agent or any Lender may have had notice or
knowledge of any Default at the time of any Borrowing, and shall continue in
full force and effect as long as any Loan or any other Obligation hereunder
shall remain unpaid or unsatisfied.

 

11.12       Severability.  If any provision of this Agreement or the other Loan
Documents is held to be illegal, invalid or unenforceable, (a) the legality,
validity and enforceability of the remaining provisions of this Agreement and
the other Loan Documents shall not be affected or impaired thereby and (b) the
parties shall endeavor in good faith negotiations to replace the illegal,
invalid or unenforceable provisions with valid provisions the economic effect of
which comes as close as possible to that of the illegal, invalid or
unenforceable provisions.  The invalidity of a provision in a particular
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction.

 

11.13       Governing Law; Jurisdiction; Etc.

 

(a)           GOVERNING LAW.  THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED
IN ACCORDANCE WITH, THE LAW OF THE COMMONWEALTH OF MASSACHUSETTS.

 

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(b)           SUBMISSION TO JURISDICTION.  BORROWER AND EACH OTHER LOAN PARTY
IRREVOCABLY AND UNCONDITIONALLY SUBMITS, FOR ITSELF AND ITS PROPERTY, TO THE
NONEXCLUSIVE JURISDICTION OF THE COURTS OF THE COMMONWEALTH OF MASSACHUSETTS
SITTING IN SUFFOLK COUNTY AND OF THE UNITED STATES DISTRICT COURT OF THE
DISTRICT OF MASSACHUSETTS, AND ANY APPELLATE COURT FROM ANY THEREOF, IN ANY
ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER
LOAN DOCUMENT, OR FOR RECOGNITION OR ENFORCEMENT OF ANY JUDGMENT, AND EACH OF
THE PARTIES HERETO IRREVOCABLY AND UNCONDITIONALLY AGREES THAT ALL CLAIMS IN
RESPECT OF ANY SUCH ACTION OR PROCEEDING MAY BE HEARD AND DETERMINED IN SUCH
MASSACHUSETTS STATE COURT OR, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW,
IN SUCH FEDERAL COURT.  EACH OF THE PARTIES HERETO AGREES THAT A FINAL JUDGMENT
IN ANY SUCH ACTION OR PROCEEDING SHALL BE CONCLUSIVE AND MAY BE ENFORCED IN
OTHER JURISDICTIONS BY SUIT ON THE JUDGMENT OR IN ANY OTHER MANNER PROVIDED BY
LAW.  NOTHING IN THIS AGREEMENT OR IN ANY OTHER LOAN DOCUMENT SHALL AFFECT ANY
RIGHT THAT AGENT OR ANY LENDER MAY OTHERWISE HAVE TO BRING ANY ACTION OR
PROCEEDING RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT AGAINST
BORROWER OR ANY OTHER LOAN PARTY OR ITS PROPERTIES IN THE COURTS OF ANY
JURISDICTION.

 

(c)           WAIVER OF VENUE.  BORROWER AND EACH OTHER LOAN PARTY IRREVOCABLY
AND UNCONDITIONALLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW,
ANY OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY
ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER
LOAN DOCUMENT IN ANY COURT REFERRED TO IN PARAGRAPH (B) OF THIS SECTION.  EACH
OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED
BY APPLICABLE LAW, THE DEFENSE OF AN INCONVENIENT FORUM TO THE MAINTENANCE OF
SUCH ACTION OR PROCEEDING IN ANY SUCH COURT.

 

(d)           SERVICE OF PROCESS.  EACH PARTY HERETO IRREVOCABLY CONSENTS TO
SERVICE OF PROCESS IN THE MANNER PROVIDED FOR NOTICES IN SECTION 11.02.  NOTHING
IN THIS AGREEMENT WILL AFFECT THE RIGHT OF ANY PARTY HERETO TO SERVE PROCESS IN
ANY OTHER MANNER PERMITTED BY APPLICABLE LAW.

 

11.14       WAIVER OF JURY TRIAL.  EACH PARTY HERETO HEREBY IRREVOCABLY WAIVES,
TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A
TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR
RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT OR THE TRANSACTIONS
CONTEMPLATED HEREBY OR THEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER
THEORY).  EACH PARTY HERETO (A) CERTIFIES THAT NO

 

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REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PERSON HAS REPRESENTED, EXPRESSLY
OR OTHERWISE, THAT SUCH OTHER PERSON WOULD NOT, IN THE EVENT OF LITIGATION, SEEK
TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER
PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT AND THE OTHER LOAN
DOCUMENTS BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS
SECTION.

 

11.15       No Advisory or Fiduciary Responsibility.  In connection with all
aspects of each transaction contemplated hereby (including in connection with
any amendment, waiver or other modification hereof or of any other Loan
Document),  Borrower and each other Loan Party acknowledges and agrees and
acknowledges its Affiliates’ understanding that that:  (i) (A)  the services
regarding this Agreement provided by Agent are arm’s-length commercial
transactions between Borrower, each other Loan Party and their respective
Affiliates, on the one hand, and Agent, on the other hand, (B) each of Borrower
and the other Loan Parties have consulted their own legal, accounting,
regulatory and tax advisors to the extent they have deemed appropriate, and (C) 
Borrower and each other Loan Party is capable of evaluating and understanding,
and understands and accepts, the terms, risks and conditions of the transactions
contemplated hereby and by the other Loan Documents; (ii) (A)  Agent is and has
been acting solely as a principal and,  except as expressly agreed in writing by
the relevant parties, has not been, is not, and will not be acting as an
advisor, agent or fiduciary, for Borrower, any other Loan Party, or any of their
respective Affiliates, or any other Person and (B) Agent does not have any
obligation to Borrower, any other Loan Party or any of their Affiliates with
respect to the transaction contemplated hereby except those obligations
expressly set forth herein and in the other Loan Documents; and (iii)  Agent and
its Affiliates may be engaged in a broad range of transactions that involve
interests that differ from those of Borrower, the other Loan Parties and their
respective Affiliates, and Agent has no obligation to disclose any of such
interests to Borrower, any other Loan Party of any of their respective
Affiliates.  To the fullest extent permitted by law, each of Borrower and the
other Loan Parties hereby waive and release,  any claims that it may have
against Agent with respect to any breach or alleged breach of agency or
fiduciary duty in connection with any aspect of any transaction contemplated
hereby.

 

11.16       USA Patriot Act Notice.  Each Lender that is subject to the Act (as
hereinafter defined) and Agent (for itself and not on behalf of any Lender)
hereby notifies each Loan Party that pursuant to the requirements of the USA
PATRIOT Act (Title III of Pub. L. 107-56 (signed into law October 26, 2001))
(the “Act”), it is required to obtain, verify and record information that
identifies such Loan Party, which information includes the name and address of
such Loan Party and other information that will allow such Lender or Agent, as
applicable, to identify such Loan Party in accordance with the Act.

 

11.17       Time of the Essence.  Time is of the essence of the Loan Documents.

 

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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed as of the date first above written.

 

 

ANIKA THERAPEUTICS, INC.

 

 

 

By:

/s/ Kevin W. Quinlan

 

 

 

Name:

Kevin Quinlan

 

 

 

Title:

Chief Financial Officer

 

 

 

 

 

ANIKA SECURITIES, INC.

 

 

 

By:

/s/ Kevin W. Quinlan

 

 

 

Name:

Kevin Quinlan

 

 

 

Title:

Chief Financial Officer

 

 

 

 

 

BANK OF AMERICA, N.A., as Administrative
Agent

 

 

 

By:

/s/ Jean S. Manthorne

 

 

 

Name:

Jean S. Manthorne

 

 

 

Title:

Senior Vice President

 

 

 

 

 

BANK OF AMERICA, N.A., as a Lender

 

 

 

By:

/s/ Jean S. Manthorne

 

 

 

Name:

Jean S. Manthorne

 

 

 

Title:

Senior Vice President

 

[Signature Page to Credit Agreement]

 

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