Exhibit 10.2
EXHIBIT A TO
THIRD AMENDMENT AND
RESTATEMENT AGREEMENT
(JPMORGAN LOGO) [c10185c1018502.gif]
THIRD AMENDED AND RESTATED CREDIT AGREEMENT
dated as of December 21, 2010,
among
USG CORPORATION,
as Borrower,
The Lenders Party Hereto,
JPMORGAN CHASE BANK, N.A.,
as Administrative Agent,
and
BANK OF AMERICA, N.A. and WELLS FARGO BANK, N.A.,
as Co-Syndication Agents
J.P. MORGAN SECURITIES LLC and
MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED,
as Lead Arrangers and Bookrunners
WELLS FARGO SECURITIES, LLC
as Bookrunner
[CS&M Ref.: 6701-860]

 

 

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TABLE OF CONTENTS

              Page  
 
        ARTICLE I

 
        Definitions

 
       
SECTION 1.01. Defined Terms
    1  
SECTION 1.02. Classification of Loans and Borrowings
    29  
SECTION 1.03. Terms Generally
    29  
SECTION 1.04. Accounting Terms; GAAP
    29  
SECTION 1.05. Pro Forma Calculations
    30  
 
        ARTICLE II

 
        The Credits

 
       
SECTION 2.01. Revolving Commitments
    30  
SECTION 2.02. Loans and Borrowings
    30  
SECTION 2.03. Requests for Borrowings
    31  
SECTION 2.04. Swingline Loans and Overadvances
    31  
SECTION 2.05. Letters of Credit
    33  
SECTION 2.06. Funding of Borrowings
    37  
SECTION 2.07. Interest Elections
    37  
SECTION 2.08. Termination and Reduction of Revolving Commitments
    38  
SECTION 2.09. Repayment of Loans; Evidence of Debt
    39  
SECTION 2.10. Prepayment of Loans
    40  
SECTION 2.11. Fees
    40  
SECTION 2.12. Interest
    41  
SECTION 2.13. Alternate Rate of Interest
    42  
SECTION 2.14. Increased Costs
    42  
SECTION 2.15. Break Funding Payments
    43  
SECTION 2.16. Taxes
    44  
SECTION 2.17. Payments Generally; Allocation of Proceeds; Sharing of Setoffs
    46  
SECTION 2.18. Mitigation Obligations; Replacement of Lenders
    48  
SECTION 2.19. Revolving Commitment Increases
    49  
SECTION 2.20. Defaulting Lenders
    50  
 
        ARTICLE III

 
        Representations and Warranties

 
       
SECTION 3.01. Organization; Powers
    52  
SECTION 3.02. Authorization; Enforceability
    52  
SECTION 3.03. Governmental Approvals; No Conflicts
    52  
SECTION 3.04. Financial Condition; No Material Adverse Change
    53  
SECTION 3.05. Properties
    53  
SECTION 3.06. Litigation and Environmental Matters
    53  
SECTION 3.07. Compliance with Laws and Agreements
    54  
SECTION 3.08. Investment Company Status
    54  
SECTION 3.09. Taxes
    54  
SECTION 3.10. ERISA
    54  
SECTION 3.11. Disclosure
    54  
SECTION 3.12. Insurance
    54  
SECTION 3.13. Security Interest in Collateral
    54  
SECTION 3.14. Labor Matters
    55  
 
       

 

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              Page  
 
        ARTICLE IV

 
        Conditions

 
       
SECTION 4.01. [Intentionally Omitted]
    55  
SECTION 4.02. Each Credit Event
    55     ARTICLE V

 
        Affirmative Covenants

 
       
SECTION 5.01. Financial Statements; Borrowing Base and Other Information
    56  
SECTION 5.02. Notices of Material Events
    57  
SECTION 5.03. Existence; Conduct of Business
    58  
SECTION 5.04. Payment of Taxes
    58  
SECTION 5.05. Maintenance of Properties
    58  
SECTION 5.06. Insurance
    58  
SECTION 5.07. Books and Records; Inspection Rights; Field Examinations;
Inventory Appraisals
    59  
SECTION 5.08. Compliance with Laws
    60  
SECTION 5.09. Use of Proceeds and Letters of Credit
    60  
SECTION 5.10. Further Assurances
    60  
 
        ARTICLE VI

 
        Negative Covenants

 
       
SECTION 6.01. Indebtedness
    61  
SECTION 6.02. Liens
    62  
SECTION 6.03. Fundamental Changes
    64  
SECTION 6.04. Investments
    64  
SECTION 6.05. Sale and Leaseback Transactions
    66  
SECTION 6.06. Swap Agreements
    66  
SECTION 6.07. Restricted Payments
    66  
SECTION 6.08. Transactions with Affiliates
    66  
SECTION 6.09. Restrictive Agreements
    67  
SECTION 6.10. Amendment of Material Documents
    67  
SECTION 6.11. Changes in Fiscal Periods
    67  
SECTION 6.12. Fixed Charge Coverage Ratio
    67  
 
       

 

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              Page  
 
        ARTICLE VII

 
        Events of Default

 
        ARTICLE VIII

 
        The Administrative Agent

 
        ARTICLE IX

 
        Miscellaneous

 
       
SECTION 9.01. Notices
    72  
SECTION 9.02. Waivers; Amendments
    74  
SECTION 9.03. Expenses; Indemnity; Damage Waiver
    75  
SECTION 9.04. Successors and Assigns
    76  
SECTION 9.05. Survival
    79  
SECTION 9.06. Counterparts; Integration; Effectiveness
    80  
SECTION 9.07. Severability
    80  
SECTION 9.08. Right of Setoff
    80  
SECTION 9.09. Governing Law; Jurisdiction; Consent to Service of Process
    80  
SECTION 9.10. WAIVER OF JURY TRIAL
    81  
SECTION 9.11. Headings
    81  
SECTION 9.12. Confidentiality
    81  
SECTION 9.13. USA PATRIOT Act
    82  
SECTION 9.14. Disclosure
    82  
SECTION 9.15. Appointment for Perfection
    82  
SECTION 9.16. Interest Rate Limitation
    82  
SECTION 9.17. Existing Credit Agreement; Effectiveness of Amendment and
Restatement
    83  
SECTION 9.18. No Fiduciary Relationship
    83  
 
       

         
SCHEDULES:
       
 
       
Schedule 1.01(a) — Investment Objective and Guidelines
       
Schedule 1.01(b) — Borrowing Base Supplemental Documentation
       
Schedule 2.01 — Commitments
       
Schedule 3.06 — Disclosed Matters
       
Schedule 6.01 — Existing Indebtedness
       
Schedule 6.02 — Existing Liens
       
Schedule 6.04 — Existing Investments
       
Schedule 6.09 — Existing Restrictions
       

 

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EXHIBITS:
       
 
       
Exhibit A — Form of Assignment and Assumption
       
Exhibit B — Form of Borrowing Base Certificate
       
Exhibit C — Form of Borrowing Request
       
Exhibit D — Form of Interest Election Request
       
Exhibit E — Form of Compliance Certificate
       
Exhibit F — Form of Administrative Questionnaire
       
Exhibit G — Form of Perfection Certificate
       
Exhibit H — Form of Revolving Note
       
Exhibit I — Form of Reaffirmation Agreement
       

 

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THIRD AMENDED AND RESTATED CREDIT AGREEMENT dated as of December 21, 2010 (this
“Agreement”), among USG CORPORATION, a Delaware corporation, the LENDERS party
hereto, JPMORGAN CHASE BANK, N.A., as Administrative Agent, and BANK OF AMERICA,
N.A. and WELLS FARGO BANK, N.A., as Co-Syndication Agents.
Subject to satisfaction of the conditions set forth in the Third Amendment and
Restatement Agreement dated as of December 21, 2010 (the “Amendment and
Restatement Agreement”), among the Borrower, the Lenders (as defined in the
Existing Credit Agreement referred to below) party thereto and the
Administrative Agent, the Second Amended and Restated Credit Agreement dated as
of January 7, 2009, among the Borrower, the Lenders party thereto, the
Administrative Agent and Goldman Sachs Credit Partners, L.P., as syndication
agent (the “Existing Credit Agreement”), is amended and restated in its entirety
to read as provided herein.
ARTICLE I
Definitions
SECTION 1.01. Defined Terms. As used in this Agreement, the following terms have
the meanings specified below:
“2014 Notes” means the Borrower’s 9.75% Senior Notes due 2014, issued pursuant
to the 2014 Notes Documents.
“2014 Notes Documents” means the Indenture dated as of November 1, 2006, by and
between the Borrower and HSBC Bank USA, National Association (as successor to
Wells Fargo Bank, National Association), as Trustee (including Supplemental
Indenture No. 2, dated as of August 4, 2009, to such Indenture), all side
letters, instruments, agreements and other documents evidencing or governing the
2014 Notes, providing for any guarantee or other right in respect thereof,
affecting the terms of the foregoing or entered into in connection therewith and
all schedules, exhibits and annexes to each of the foregoing.
“2014 Notes Event” means any of the following: (a) the redemption, repayment,
defeasance or other discharge, in full, of the 2014 Notes (including all accrued
but unpaid interest, fees and other amounts in respect thereof) in accordance
with the terms of the 2014 Notes Documents (other than with the proceeds of
Indebtedness); (b) the amendment to or other modification of the 2014 Notes and
the 2014 Notes Documents causing the maturity date of the 2014 Notes (currently
August 1, 2014) to be extended to a date that is at least 91 days after the
Original Maturity Date; and (c) the refinancing of all the 2014 Notes with
Indebtedness permitted under Section 6.01 having a maturity date that is at
least 91 days after the Original Maturity Date, provided that, in the case of
clauses (b) and (c) of this definition, the 2014 Notes as so amended, or any
refinancing Indebtedness in respect thereof, do not require (i) any mandatory
prepayment or redemption at the option of the holders thereof (except for
redemptions in respect of asset sales and changes in control on terms (other
than with respect to the amount of the premium above par paid to the holders
thereof in connection with a mandatory prepayment or redemption in respect of
changes in control) not less favorable to the Lenders than the terms of the 2014
Notes as in effect on the date hereof) prior to the date that is 91 days after
the Original Maturity Date and (ii) more than 20% of the original principal
amount of such Indebtedness to be amortized prior to the date that is 91 days
after the Original Maturity Date.

 

 

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“ABR”, when used in reference to any Loan or Borrowing, refers to whether such
Loan, or the Loans comprising such Borrowing, are bearing interest at a rate
determined by reference to the Alternate Base Rate.
“Account” has the meaning assigned to such term in the Security Agreement.
“Account Debtor” means any Person obligated on an Account.
“Act” has the meaning assigned to such term in Section 9.13.
“Adjusted Eligible Accounts” means, at any time, the Eligible Accounts at such
time minus the Dilution Reserve at such time.
“Adjusted LIBO Rate” means, with respect to any Eurodollar Borrowing for any
Interest Period, an interest rate per annum (except in the case of the
determination of the Adjusted LIBO Rate for purposes of clause (c) of the
definition of the term “Alternate Base Rate”, rounded upwards, if necessary, to
the next 1/100 of 1%) equal to (a) the LIBO Rate for such Interest Period
multiplied by (b) the Statutory Reserve Rate.
“Administrative Agent” means JPMorgan Chase Bank, N.A., in its capacity as
administrative agent for the Lenders hereunder, and its successors in such
capacity as provided in Article VIII.
“Administrative Questionnaire” means an administrative questionnaire,
substantially in the form of Exhibit F or any other form approved by the
Administrative Agent.
“Affiliate” means, with respect to a specified Person, another Person that
directly, or indirectly through one or more intermediaries, Controls or is
Controlled by or is under common Control with the Person specified; provided,
however, that for purposes of (a) Section 9.04(b)(i), the term “Affiliate” shall
also include any person that directly, or indirectly through one or more
intermediaries, owns 10% or more of any class of Equity Interests of the Person
specified or that is an officer or director of the Person specified and (b) the
definition of the term “Eligible Accounts”, an “Affiliate” of the Collateral
Parties shall not be deemed to include (i) Berkshire (or any of its Affiliates,
other than the Borrower or any of the Subsidiaries), (ii) Gebr. Knauf
Verwaltungsgesellschaft KG (or any of its Affiliates, other than the Borrower or
any of the Subsidiaries) and (iii) with respect to Accounts in an amount less
than $100,000 per person at any time outstanding arising in the ordinary course
of business of the Collateral Parties, any officer, director or employee of any
Loan Party. For purposes of the foregoing, the parties hereto acknowledge that,
as of the Restatement Effective Date, neither Berkshire nor Gebr. Knauf
Verwaltungsgesellschaft KG is an Affiliate of the Borrower or any of the
Subsidiaries, except as provided in clause (a) of the immediately-preceding
proviso as a result of such entity’s ownership of Equity Interests of the
Borrower.
“Affiliated Account Debtor” means, with respect to any Account Debtor and solely
to the extent that any Loan Party has knowledge of such ownership, another
Person (a) that directly, or indirectly through one or more intermediaries, owns
25% or more of the voting Equity Interests of such Account Debtor or (b) of
which 25% or more of the voting Equity Interests of such Person is directly, or
indirectly through one or more intermediaries, owned by such Account Debtor or
by any Person described in clause (a) of this definition.
“Agreement” has the meaning assigned to such term in the preamble to this
Agreement.

 

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“Alternate Base Rate” means, for any day, a rate per annum equal to the greatest
of (a) the Prime Rate in effect on such day, (b) the Federal Funds Effective
Rate in effect on such day plus 1/2 of 1% and (c) the Adjusted LIBO Rate
announced on such day (or if such day is not a Business Day, the immediately
preceding Business Day) for a one-month interest period beginning two Business
Days after such day plus 1%, provided that, for the avoidance of doubt, the LIBO
Rate used to determined the Adjusted LIBO Rate announced on any day (as
referenced in the immediately preceding clause (c)) shall be based on the rate
appearing on the Reuters “LIBOR01” screen displaying British Bankers’
Association Settlement Rates (or on any successor or substitute screen provided
by Reuters, or any successor to or substitute for such service, providing rate
quotations comparable to those currently provided on such screen, as determined
by the Administrative Agent from time to time for purposes of providing
quotations of interest rates applicable to dollar deposits in the London
interbank market) at approximately 11:00 a.m., London time, on such day (or, if
such day is not a Business Day in connection with a Eurocurrency Loan, on the
immediately preceding Business Day) for a one-month interest period beginning
two Business Days after such day. Any change in the Alternate Base Rate due to a
change in the Prime Rate, the Federal Funds Effective Rate or the Adjusted LIBO
Rate shall be effective from and including the effective date of such change in
the Prime Rate, the Federal Funds Effective Rate or the Adjusted LIBO Rate,
respectively.
“Amendment and Restatement Agreement” has the meaning assigned to such term in
the preamble hereto.
“Applicable Percentage” means, at any time with respect to any Revolving Lender,
the percentage of the aggregate Revolving Commitments represented by such
Lender’s Revolving Commitment at such time, provided that, for purposes of
Section 2.20, when a Defaulting Lender shall exist, “Applicable Percentage”
shall mean, at any time with respect to (a) any Revolving Lender other than a
Defaulting Lender, the percentage of the aggregate Revolving Commitments
(disregarding any Defaulting Lender’s Revolving Commitment) represented by such
Revolving Lender’s Revolving Commitment at such time, and (b) any Defaulting
Lender, 0%. If the Revolving Commitments have terminated or expired, the
Applicable Percentages shall be determined based upon the Revolving Commitments
most recently in effect, giving effect to any assignments of Revolving Loans, LC
Exposure and Swingline Exposure that occur after such termination or expiration
and to any Lender’s status as a Defaulting Lender at the time of determination.
“Applicable Rate” means, for any day with respect to any ABR Loan or Eurodollar
Loan, 3.00% per annum.
“Approved Fund” has the meaning assigned to such term in Section 9.04(b).
“Arrangers” means J.P. Morgan Securities LLC and Merrill Lynch, Pierce, Fenner &
Smith Incorporated.
“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 9.04), and accepted by the Administrative Agent, in the form of
Exhibit A or any other form approved by the Administrative Agent.
“Augmenting Lender” has the meaning assigned to such term in Section 2.19(a).
“Available Finished Good Inventory” means, at any time, the lesser of (a) 60% of
an amount equal to (x) the Eligible Finished Goods Inventory (valued at the
lower of cost (determined on a first-in, first-out basis) or market value) at
such time less (y) Inventory Reserves applicable thereto and (b) 85% of the
product of (i) the Net Orderly Liquidation Value percentage identified in the
most recent Inventory appraisal provided to the Administrative Agent in
accordance with the terms hereof multiplied by (ii) an amount equal to (x) the
Eligible Finished Goods Inventory (valued at the lower of cost (determined on a
first-in, first-out basis) or market value) at such time less (y) any Inventory
Reserves applicable thereto.

 

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“Available Raw Materials Inventory” means, at any time, the lesser of (a) 60% of
an amount equal to (x) the Eligible Raw Materials Inventory (valued at the lower
of cost (determined on a first-in, first-out basis) or market value) at such
time less (y) Inventory Reserves applicable thereto and (b) 85% of the product
of (i) the Net Orderly Liquidation Value percentage identified in the most
recent Inventory appraisal provided to the Administrative Agent in accordance
with the terms hereof multiplied by (ii) an amount equal to (x) the Eligible Raw
Materials Inventory (valued at the lower of cost (determined on a first-in,
first-out basis) or market value) at such time less (y) any Inventory Reserves
applicable thereto.
“Available WIP Inventory” means, at any time, the lesser of (a) 60% of an amount
equal to (x) the Eligible WIP Inventory (valued at the lower of cost (determined
on a first-in, first-out basis) or market value) at such time less (y) Inventory
Reserves applicable thereto and (b) 85% of the product of (i) the Net Orderly
Liquidation Value percentage identified in the most recent Inventory appraisal
provided to the Administrative Agent in accordance with the terms hereof
multiplied by (ii) an amount equal to (x) the Eligible WIP Inventory (valued at
the lower of cost (determined on a first-in, first-out basis) or market value)
at such time less (y) any Inventory Reserves applicable thereto.
“Availability Period” means the period from and including the Business Day
immediately following the Restatement Effective Date to but excluding the
earlier of the Maturity Date and the date of termination of the Revolving
Commitments.
“Banking Services” means each and any of the following bank services provided to
any Loan Party by any Lender or any of its Affiliates: (a) commercial credit
cards and cardless e-payables services, (b) stored value cards and (c) treasury
management services (including controlled disbursement, automated clearinghouse
transactions, return items, overdrafts and interstate depository network
services).
“Banking Services Obligations” of the Loan Parties means any and all obligations
(including obligations existing as of the Restatement Effective Date) of the
Loan Parties, whether absolute or contingent and howsoever and whensoever
created, arising, evidenced or acquired (including all renewals, extensions and
modifications thereof and substitutions therefor), in connection with Banking
Services.
“Bankruptcy Event” means, with respect to any Person, such Person becoming the
subject of a bankruptcy or insolvency proceeding, or having had a receiver,
conservator, trustee, administrator, custodian, assignee for the benefit of
creditors or similar Person charged with the reorganization or liquidation of
such Person’s business appointed for it, or, in the good faith determination of
the Administrative Agent, having taken any action in furtherance of, or
indicating its consent to, approval of or acquiescence in, any such proceeding
or appointment, provided that a Bankruptcy Event shall not result solely by
virtue of any ownership interest, or the acquisition of any ownership interest,
in such Person by any Governmental Authority or instrumentality thereof;
provided further that such ownership interest does not result in or provide such
Person with immunity from the jurisdiction of courts within the United States or
from the enforcement of judgments or writs of attachment on its assets or permit
such Person (or such Governmental Authority or instrumentality thereof) to
reject, repudiate, disavow or disaffirm any contracts or agreements made by such
Person.
“Berkshire” means Berkshire Hathaway Inc., a Delaware corporation.

 

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“Board” means the Board of Governors of the Federal Reserve System of the U.S.
“Borrower” means USG Corporation, a Delaware corporation.
“Borrowing” means (a) Revolving Loans of the same Type, made, converted or
continued on the same date and, in the case of Eurodollar Loans, as to which a
single Interest Period is in effect, (b) a Swingline Loan and (c) an
Overadvance.
“Borrowing Base” means, at any time, an amount equal to the sum of (a) 85% of
the Adjusted Eligible Accounts at such time plus (b) the sum of (i) Available
Finished Goods Inventory, (ii) Available Raw Materials Inventory and
(iii) Available WIP Inventory, in each case at such time, less (c) without
duplication of other Reserves included in the foregoing components of the
Borrowing Base, the amount of any other Reserves established by the
Administrative Agent in its Permitted Discretion at such time. The
Administrative Agent may, in its Permitted Discretion and based on new
information or a change in circumstances, adjust Reserves, with any such change
to be effective three Business Days after delivery of notice thereof to the
Borrower and the Lenders. Subject to the immediately preceding sentence, the
Borrowing Base at any time shall be determined by reference to the Borrowing
Base Certificate most recently delivered to the Administrative Agent pursuant to
Section 5.01(e) (or, in the case of the initial Borrowing Base Certificate
delivered in connection with this Agreement, pursuant to Section 4(f) of the
Amendment and Restatement Agreement), subject to adjustments made by the
Administrative Agent in its Permitted Discretion to address any events or
conditions relating to any of the Collateral occurring on or after the date with
respect to which such Borrowing Base Certificate relates.
“Borrowing Base Certificate” means a certificate, signed and certified as
accurate and complete by a Financial Officer, in substantially the form of
Exhibit B or another form which is reasonably acceptable to each of the
Administrative Agent and the Borrower.
“Borrowing Base Supplemental Documentation” means the documentation listed on
Schedule 1.01(b).
“Borrowing Request” means a request by the Borrower for a Borrowing in
accordance with Section 2.03.
“Business Day” means any day that is not a Saturday, Sunday or other day on
which commercial banks in New York City are authorized or required by law to
remain closed, provided that, when used in connection with a Eurodollar Loan,
the term “Business Day” shall also exclude any day on which banks are not open
for dealings in dollar deposits in the London interbank market.
“Canadian dollars” means the lawful money of Canada.
“Capital Expenditures” means, for any period, without duplication, any
expenditure for any purchase or other acquisition of any asset that would be
classified as a capital expenditure in the financial statements of the Borrower
and the Subsidiaries for such period, prepared in accordance with GAAP.
“Capital Lease Obligations” of any Person means the obligations of such Person
to pay rent or other amounts under any lease of (or other arrangement conveying
the right to use) real or personal property, or a combination thereof, which
obligations are required to be classified and accounted for as capital leases on
a balance sheet of such Person under GAAP, and the amount of such obligations
shall be the capitalized amount thereof determined in accordance with GAAP.

 

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“Cash Dominion Period” means any period in which full cash dominion is in effect
pursuant to Section 7.03 of the Security Agreement (which, for purposes of
clarity, shall be during any of (a) each period beginning on the date on which
Excess Availability shall have been less than the Threshold Amount for five
consecutive Business Days and ending on the first date thereafter on which
Excess Availability shall have been equal to or greater than the Threshold
Amount for 30 consecutive calendar days and (b) the continuation of any Event of
Default). As contemplated by Section 7.03 of the Security Agreement, the Cash
Dominion Period, if any, that commences during the second Cash Dominion
Termination Period (as such term is defined in the Security Agreement), or after
the acceleration of the Loans and/or the termination of the Commitments in
accordance with Article VII, shall be deemed to continue until such time as the
Security Agreement is terminated in accordance with the terms thereof.
“Change in Control” means (a) the ownership, directly or indirectly,
beneficially or of record, by any Person or group (in each case, within the
meaning of the Securities Exchange Act and the rules of the SEC thereunder as in
effect on the Restatement Effective Date) other than the Restricted Group (or
any of them) of Equity Securities representing more than 25% of the aggregate
ordinary voting power represented by Voting Securities of the Borrower
(determined on a Fully Diluted Basis) or (b) the ownership, directly or
indirectly, beneficially or of record, by the Restricted Group (or any of them)
of Equity Securities representing more than 40% of the aggregate ordinary voting
power represented by the Voting Securities of the Borrower (determined on a
Fully Diluted Basis).
“Change in Law” means (a) the adoption of any law, rule or regulation after the
Restatement Effective Date, (b) any change in any law, rule or regulation or in
the interpretation or application thereof by any Governmental Authority after
the Restatement Effective Date or (c) compliance by any Lender or the Issuing
Bank (or, for purposes of Section 2.14(b), by any lending office of such Lender
or by such Lender’s or the Issuing Bank’s holding company, if any) with any
request, guideline or directive (whether or not having the force of law) of any
Governmental Authority made or issued after the Restatement Effective Date.
“CLO” has the meaning assigned to such term in Section 9.04(b).
“Code” means the Internal Revenue Code of 1986, as amended from time to time.
“Collateral” has the meaning assigned to such term in the Security Agreement.
“Collateral Access Agreement” has the meaning assigned to such term in the
Security Agreement.
“Collateral Documents” means, collectively, the Security Agreement, the Deposit
Account Control Agreements, the Collateral Access Agreements and each other
security agreement or other instrument or document executed and delivered
pursuant to Section 5.10 to secure any of the Secured Obligations.
“Collateral Parties” means, collectively, the Loan Parties (other than any
Subsidiary that is not a wholly owned Subsidiary).
“Collection Account” has the meaning assigned to such term in the Security
Agreement.
“Commitment” means (a) with respect to any Revolving Lender, such Lender’s
Revolving Commitment and (b) with respect to the Swingline Lender, its Swingline
Commitment.

 

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“Commitment Increase Amendment” has the meaning assigned to such term in Section
2.19(b).
“Consolidated Cash Interest Expense” means, for any period, the sum, without
duplication, of (a) the total net consolidated interest expense of the Borrower
and the Subsidiaries for such period (as shown on a consolidated income
statement of the Borrower for such period) plus (b) all cash dividends paid or
payable during such period in respect of Disqualified Equity Interests of the
Borrower or any Subsidiary (but expressly excluding any such dividends paid or
payable to the Borrower or any Subsidiary).
“Consolidated EBITDA” means, for any period, Consolidated Net Income for such
period before interest, taxes, depreciation, amortization and other non-cash
adjustments (other than adjustments relating to minority interest expense) to
Consolidated Net Income for such period, provided that Consolidated EBITDA shall
be decreased by the amount of any cash expenditures in such period relating to
non-cash adjustments added back to Consolidated EBITDA in any prior period.
“Consolidated Net Income” means, for any period, the net income or loss of the
Borrower and the Subsidiaries for such period determined on a consolidated basis
in accordance with GAAP, excluding any extraordinary gains or losses of the
Borrower and the Subsidiaries for such period, provided that Consolidated Net
Income shall not include the income or loss of any Subsidiary that is not wholly
owned by the Borrower to the extent such income or loss is attributable to the
non-controlling interest in such Subsidiary.
“Control” means the possession, directly or indirectly, of the power to direct
or cause the direction of the management or policies, or the dismissal or
appointment of the management, of a Person, whether through the ability to
exercise voting power, by contract or otherwise. “Controlling” and “Controlled”
have meanings correlative thereto.
“Convertible Securities” means securities of the Borrower that are convertible
or exchangeable (whether presently convertible or exchangeable or not) into
Voting Securities.
“Credit Party” means the Administrative Agent, the Issuing Bank, the Swingline
Lender or any other Lender.
“Default” means any event or condition that constitutes an Event of Default or
that upon notice, lapse of time or both would, unless cured or waived, become an
Event of Default.
“Defaulting Lender” means any Revolving Lender that (a) has failed, within five
Business Days of the date required to be funded or paid, to (i) fund any portion
of its Loans, (ii) fund any portion of its participations in Letters of Credit,
Swingline Loans or Overadvances or (iii) pay over to any Credit Party any other
amount required to be paid by such Revolving Lender hereunder, unless, in the
case of clause (i) above, such Revolving Lender notifies the Administrative
Agent in writing that such failure is the result of such Revolving Lender’s good
faith determination that a condition precedent applicable to such funding
(specifically identified and including the particular default, if any) has not
been satisfied, (b) has notified the Borrower or any Credit Party in writing, or
has made a public statement to the effect, that it does not intend or expect to
comply with any of its funding obligations (x) under this Agreement (unless such
writing or public statement indicates that such position is based on such
Revolving Lender’s good faith determination that a condition precedent
applicable to such funding (specifically identified and including the particular
default, if any) cannot be satisfied) or (y) generally under other agreements in
which it commits to extend credit, (c) has failed, within three Business Days
after request by a Credit Party, acting in good faith, to provide a
certification in writing from an authorized officer of such Revolving Lender
that it will comply with its obligations (and is financially able to meet such
obligations) to fund prospective Loans and participations in then outstanding
Letters of Credit, Swingline Loans and Overadvances, provided that such
Revolving Lender shall cease to be a Defaulting Lender pursuant to this clause
(c) upon such Credit Party’s receipt of such certification in form and substance
satisfactory to it and the Administrative Agent, or (d) has become the subject
of a Bankruptcy Event.

 

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“Deposit Account Control Agreement” has the meaning assigned to such term in the
Security Agreement.
“Dilution Factors” means, without duplication of any reduction to the balance of
any Account, with respect to any period, the aggregate amount of all deductions,
credit memos, returns, adjustments, allowances, bad debt write-offs and other
non-cash credits (including all volume discounts, trade discounts and rebates)
that are recorded to reduce Accounts of the Collateral Parties in a manner
consistent with current and historical accounting practices of the Collateral
Parties.
“Dilution Ratio” means, at any time, the amount (expressed as a percentage),
calculated in connection with the delivery of the Borrowing Base Certificate for
the calendar month most recently ended, equal to (a) the aggregate amount of the
applicable Dilution Factors in respect of the Accounts of the Collateral Parties
for the twelve-calendar-month period ended as of the last day of such calendar
month divided by (b) total gross invoices of the Collateral Parties for such
twelve-calendar-month period.
“Dilution Reserve” means, at any time, the product of (a) the excess of (i) the
applicable Dilution Ratio at such time over (ii) 5.00%, multiplied by (b) the
aggregate amount of Eligible Accounts at such time.
“Disclosed Matters” means the actions, suits and proceedings and the
environmental matters disclosed in Schedule 3.06 or in any SEC Filing.
“Disqualified Equity Interests” means Equity Interests that (a) mature or are
mandatorily redeemable or subject to mandatory repurchase or redemption or
repurchase at the option of the holders thereof (including those Equity
Interests that may be required to be redeemed upon the failure to maintain or
achieve any financial performance standards), in each case in whole or in part
and whether upon the occurrence of any event, pursuant to a sinking fund
obligation on a fixed date or otherwise, prior to the date that is 180 days
after the Original Maturity Date (other than (i) upon payment in full of the
Obligations, reduction of the LC Exposure to zero and termination of the
Commitments or (ii) upon a “change in control”, provided that any payment
required pursuant to this clause (ii) is contractually subordinated in right of
payment to the Obligations on terms reasonably satisfactory to the
Administrative Agent and such requirement is applicable only in circumstances
that are market on the date of issuance of such Equity Interests) or (b) are
convertible or exchangeable, automatically or at the option of any holder
thereof, into any Indebtedness or Equity Interests or other assets, in each
case, other than Qualified Equity Interests prior to the date that is 180 days
after the Original Maturity Date (other than (i) upon payment in full of the
Obligations, reduction of the LC Exposure to zero and termination of the
Commitments or (ii) upon a “change in control”, provided that any conversion or
exchange required pursuant to this clause (ii) is contractually subordinated in
right of payment to the Obligations on terms reasonably satisfactory to the
Administrative Agent and such requirement is applicable only in circumstances
that are market on the date of issuance of such Equity Interests).
“dollars” or “$” refers to lawful money of the U.S.
“Domestic Material Subsidiary” means any Material Subsidiary that is organized
under the laws of the U.S., any State thereof or the District of Columbia.

 

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“Domestic Subsidiary” means any Subsidiary that is organized under the laws of
the U.S., any State thereof or the District of Columbia.
“Early Maturity Date” means May 2, 2014.
“Eligible Accounts” means, at any time, the Accounts of the Collateral Parties,
but excluding any Account:
(a) that is not subject to a first-priority perfected security interest in favor
of the Administrative Agent on behalf of the Secured Parties;
(b) that is subject to any Lien other than (i) a Lien in favor of the
Administrative Agent on behalf of the Secured Parties and (ii) a Lien permitted
under clauses (i) through (iv), (vi) or (xi) of Section 6.02 that does not have
priority over the Lien in favor of the Administrative Agent on behalf of the
Secured Parties;
(c) with respect to which the scheduled due date is more than 60 days after the
original invoice date, is unpaid more than 90 days after the date of the
original invoice therefor or more than 30 days after the original due date, or
which has been written off the books of the applicable Collateral Party or
otherwise designated as uncollectible (in determining the aggregate unpaid
amount owing from each Account Debtor with respect to Accounts that are unpaid
either more than 90 days after the date of the original invoice therefor or more
than 30 days after the original due date, such aggregate amount shall not be
reduced to give effect to any credits extended by, or amounts owing from, the
Collateral Parties to such Account Debtor);
(d) that is owing by an Account Debtor for which more than 50% of the Accounts
owing from such Account Debtor and its Affiliated Account Debtors are ineligible
under clause (c) of this definition;
(e) that is owing by an Account Debtor to the extent the aggregate amount of
Accounts owing from such Account Debtor and its Affiliated Account Debtors to
all Collateral Parties exceeds (i) if the corporate credit rating of such
Account Debtor is BBB- or higher by S&P and the corporate family rating of such
Account Debtor is Baa3 or higher by Moody’s, 20% of the aggregate amount of all
Eligible Accounts at such time or (ii) if the corporate credit rating and the
corporate family rating of such Account Debtor are otherwise (or if such Account
Debtor does not have a corporate credit rating or a corporate family rating from
S&P and Moody’s, respectively), 15% of the aggregate amount of all Eligible
Accounts at such time;
(f) with respect to which any covenant, representation, or warranty contained in
any Loan Document has been breached or is not true;
(g) that (i) does not arise from the sale of goods or performance of services in
the applicable Collateral Party’s ordinary course of business, (ii) is not
evidenced by an invoice or other documentation reasonably satisfactory to the
Administrative Agent that has been sent to the Account Debtor, (iii) represents
a progress billing, (iv) is contingent upon any Collateral Party’s completion of
any further performance, (v) represents a sale on a bill-and-hold, guaranteed
sale, sale-and-return, sale on approval, consignment, cash-on-delivery or any
other repurchase or return basis or (vi) relates to payments of interest;

 

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(h) for which the goods giving rise to such Account have not been shipped or
delivered to the Account Debtor (or its designee) or for which the services
giving rise to such Account have not been performed by any Collateral Party or
if such Account was invoiced more than once, provided that any Account for which
the invoice has been corrected due to billing errors and resent to the
applicable Account Debtor shall not be deemed to have been invoiced more than
once for purposes of this clause (h);
(i) with respect to which any check or other instrument of payment therefor has
been returned uncollected for any reason;
(j) that is owed by an Account Debtor that has (i) applied for, suffered or
consented to the appointment of any receiver, custodian, trustee or liquidator
of its assets, (ii) had possession of all or a material part of its property
taken by any receiver, custodian, trustee or liquidator, (iii) filed, or had
filed against it, any request or petition for liquidation, reorganization,
arrangement, adjustment of debts, adjudication as bankrupt, winding-up or
voluntary or involuntary case under any state or federal bankruptcy laws, (iv)
admitted in writing its inability, or is generally unable, to pay its debts as
they become due, (v) become insolvent or (vi) ceased operation of its business;
(k) that is owed by any Account Debtor that has sold all or substantially all of
its assets (it being understood, for purposes of clarity, that any Account that
is transferred to the purchaser of all or substantially all of an Account
Debtor’s assets in connection with any such sale shall be an Account owed by
such purchaser and shall not be deemed to be ineligible as a result of the
application of this clause (k));
(l) that is owed by an Account Debtor that (i) does not maintain its chief
executive office in the U.S. (including any State thereof, the District of
Columbia and, at the Administrative Agent’s discretion following a request
therefor by the Borrower (and following the completion of, and the
Administrative Agent’s satisfaction with, due diligence deemed to be necessary
by the Administrative Agent), any territory thereof (including Puerto Rico, the
U.S. Virgin Islands and Guam)), (ii) is not otherwise a resident of the U.S.
(including any State thereof, the District of Columbia and, at the
Administrative Agent’s discretion following a request therefor by the Borrower
(and following the completion of, and the Administrative Agent’s satisfaction
with, due diligence deemed to be necessary by the Administrative Agent), any
territory thereof (including Puerto Rico, the U.S. Virgin Islands and Guam)) for
purposes of establishing jurisdiction in the U.S. over such Account Debtor and
(iii) is not organized under the applicable law of (A) the U.S. or any State or
territory thereof (including Puerto Rico, the U.S. Virgin Islands and Guam) or
the District of Columbia or (B) Canada or any province thereof, in each case
unless such Account is backed by a letter of credit, bankers acceptance or other
credit support that is acceptable to the Administrative Agent and that is in the
possession of, has been assigned to and is drawable directly by the
Administrative Agent;
(m) that is owed in any currency other than dollars or Canadian dollars;
(n) that is owed by (i) the government (or any department, agency, public
corporation or instrumentality thereof) of any country other than the U.S.
unless such Account is backed by a letter of credit, bankers acceptance or other
credit support that is acceptable to the Administrative Agent and that is in the
possession of, has been assigned to and is drawable directly by the
Administrative Agent, or (ii) the government of the U.S., or any department,
agency, public corporation or instrumentality thereof, unless the Federal
Assignment of Claims Act of 1940, as amended (31 U.S.C. § 3727 et seq. and 41
U.S.C. § 15 et seq.), and any other steps necessary to perfect the Lien of the
Administrative Agent in such Account, have been complied with to the
Administrative Agent’s reasonable satisfaction;
(o) that is owed by (i) any Affiliate of any Collateral Party or (ii) to the
extent not otherwise constituting an Affiliate of any Collateral Party, any
employee, officer, director or agent of any Collateral Party (other than, in the
case of this clause (ii), any Account in an amount less than $100,000 per person
at any time outstanding arising in the ordinary course of business of the
Collateral Parties);

 

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(p) that is (i) owed by an Account Debtor to which (or to whose Affiliated
Account Debtor) any Collateral Party is indebted, but only to the extent of such
indebtedness or (ii) subject to any security, deposit, progress payment,
retainage or other similar advance made by or for the benefit of an Account
Debtor, in each case to the extent thereof;
(q) that is subject to any counterclaim, deduction, defense, setoff or dispute
but only to the extent of any such counterclaim, deduction, defense, setoff or
dispute;
(r) that is evidenced by any promissory note, chattel paper or instrument;
(s) that is owed by an Account Debtor located in any jurisdiction which requires
filing of a “Notice of Business Activities Report” or other similar report in
order to permit the applicable Collateral Party to seek judicial enforcement in
such jurisdiction of payment of such Account, unless such Collateral Party has
filed such report or qualified to do business in such jurisdiction, provided
that any Account that would be an Eligible Account but for a failure to file
such report or qualify to do business in the applicable jurisdiction shall be
deemed to be an Eligible Account if such failure to file or qualify may be
retroactively cured by the payment of a nominal amount;
(t) with respect to which the applicable Collateral Party has made any agreement
with the Account Debtor for any reduction thereof, other than discounts and
adjustments given in the ordinary course of business, or any Account which was
partially paid and such Collateral Party created a new receivable for the unpaid
portion of such Account;
(u) that does not comply in all material respects with the requirements of all
applicable laws and regulations, whether Federal, state or local, including
without limitation the Federal Consumer Credit Protection Act, the Federal Truth
in Lending Act and Regulation Z of the Board;
(v) that is for goods that have been sold under a purchase order or pursuant to
the terms of a contract or other agreement or understanding (written or oral)
that indicates or purports that any Person other than a Collateral Party has an
ownership interest in such goods, or which indicates any party other than a
Collateral Party as payee or remittance party;
(w) that was created on cash-on-delivery terms; or
(x) that the Administrative Agent determines in its Permitted Discretion may not
be collectible from the Account Debtor for any reason.
In determining the amount of an Eligible Account, the face amount of an Account
may, in the Administrative Agent’s Permitted Discretion, be reduced by, without
duplication, to the extent not reflected in such face amount, (i) the amount of
all accrued and actual discounts, claims, credits or credits pending,
promotional program allowances, price adjustments, finance charges or other
allowances (including any amount that such Collateral Party may be obligated to
rebate to an Account Debtor pursuant to the terms of any agreement or
understanding (written or oral)) and (ii) the aggregate amount of all cash
received in respect of such Account but not yet applied by such Collateral Party
to reduce the amount of such Account. In addition, for purposes of making any
calculation under this Agreement or any other Loan Document as of any date, the
amount of any Eligible Account that is owed in Canadian dollars shall be equal
to the equivalent in dollars of the amount of such Eligible Account as of such
date determined using the Exchange Rate as of such date.

 

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“Eligible Finished Goods Inventory” means Eligible Inventory consisting of
finished goods available for sale (as determined in a manner acceptable to the
Administrative Agent in its Permitted Discretion and consistent with past
practices).
“Eligible Inventory” means, at any time, the Inventory of the Collateral
Parties, but excluding any Inventory:
(a) that is not subject to a first priority perfected Lien in favor of the
Administrative Agent on behalf of the Secured Parties, except as otherwise
resulting from the exercise of the Administrative Agent’s sole discretion under
clause (e) of this defined term with respect to goods held on consignment on
behalf of any Collateral Party (as consignor);
(b) that is subject to any Lien other than (i) a Lien in favor of the
Administrative Agent on behalf of the Secured Parties and (ii) any Lien
permitted under clauses (i) through (iv), (vi) or (xi) of Section 6.02 that does
not have priority over the Lien in favor of the Administrative Agent on behalf
of the Secured Parties;
(c) with respect to which any covenant, representation, or warranty contained in
any Loan Document has been breached or is not true and which does not conform to
all standards imposed by any applicable Governmental Authority;
(d) in which any Person other than any Collateral Party shall (i) have any
direct or indirect ownership, interest or title to such Inventory or (ii) be
indicated on any purchase order or invoice with respect to such Inventory as
having or purporting to have an interest therein;
(e) that constitutes spare or replacement parts (other than those held for sale
in the ordinary course of business), packaging and shipping material,
manufacturing supplies, samples, prototypes, displays or display items, goods
that are returned or marked for return, repossessed goods, defective or damaged
goods, goods held on consignment by any Collateral Party (as consignee), goods
held on consignment on behalf of any Collateral Party (as consignor) (other than
up to $15,000,000 of Inventory on consignment with Investment Grade Customers
and subject to a Collateral Access Agreement and, if requested by the
Administrative Agent in its sole discretion, with respect to which the
applicable Collateral Party has perfected its purchase money security interest)
or goods that are not of a type held for sale in the ordinary course of
business;
(f) that is not located in the U.S. or is in transit with a common carrier from
vendors and suppliers;
(g) that is located in any location leased by a Collateral Party unless (i) the
lessor has delivered to the Administrative Agent a Collateral Access Agreement
and such other documentation as the Administrative Agent may reasonably request
or (ii) a Rent Reserve has been established by the Administrative Agent with
respect to such Inventory, provided that any Inventory located at any such
location where Inventory on-hand has a book value of less than $100,000 shall
not constitute Eligible Inventory;

 

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(h) that is located in any third party warehouse or other storage facility or is
in the possession of a bailee (other than a third party processor) and is not
evidenced by a document (other than bills of lading to the extent permitted by
clause (f) above), unless (i) such warehouseman or bailee has delivered to the
Administrative Agent a Collateral Access Agreement and such other documentation
as the Administrative Agent may reasonably request or (ii) a Rent Reserve has
been established by the Administrative Agent with respect to such Inventory,
provided that any Inventory located at any such location where Inventory on-hand
has a book value of less than $100,000 shall not constitute Eligible Inventory;
(i) that is being processed offsite at a third party location or outside
processor unless (i) such bailee has delivered to the Administrative Agent a
Collateral Access Agreement and such other documentation as the Administrative
Agent may reasonably request or (ii) a Rent Reserve has been established by the
Administrative Agent with respect to such Inventory, provided that any Inventory
located at any such location where Inventory on-hand has a book value of less
than $100,000 shall not constitute Eligible Inventory;
(j) that is a discontinued product or component thereof;
(k) that is not reflected in a current perpetual inventory report of the
applicable Collateral Party;
(l) for which reclamation rights have been asserted by the seller;
(m) that consists of detonators, explosives or any similar device; or
(n) that the Administrative Agent determines in its Permitted Discretion is
unacceptable.
In determining the value of the Inventory (on a cost basis) at any time, there
shall be deducted (x) the aggregate amount of restocking and delivery fees
associated with such Inventory and (y) that portion of the cost of such
Inventory attributable to intercompany profits among the applicable Collateral
Party and its Affiliates.
“Eligible Raw Material Inventory” means Eligible Inventory consisting of raw
materials (as determined in a manner acceptable to the Administrative Agent in
its Permitted Discretion and consistent with past practices).
“Eligible WIP Inventory” means Eligible Inventory consisting of work-in-process
related to manufacturing of Inventory sold by any Collateral Party in the
ordinary course of its business (as determined in a manner acceptable to the
Administrative Agent in its Permitted Discretion and consistent with past
practices).
“Environmental Laws” means all treaties, laws, rules, regulations, codes,
ordinances, orders, decrees, judgments, injunctions, notices or binding
agreements issued, promulgated or entered into by or with any Governmental
Authority, relating in any way to the environment, the preservation or
reclamation of natural resources, the generation, management, use, presence,
Release or threatened Release of, or exposure to, any Hazardous Material or to
health and safety matters.
“Environmental Liability” means liabilities, obligations, claims, actions,
suits, judgments, or orders under or relating to any Environmental Law for any
damages, injunctive relief, losses, fines, penalties, fees, expenses (including
reasonable fees and expenses of attorneys and consultants) or costs, whether
contingent or otherwise, including those arising from or relating to (a) any
actual or alleged violation of any Environmental Law or permit, license or
approval issued thereunder, (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 or (e) any contract, agreement or other consensual arrangement
pursuant to which liability is assumed or imposed with respect to any of the
foregoing.

 

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“Equity Interests” means shares of capital stock, partnership interests,
membership interests in a limited liability company, beneficial interests in a
trust or other equity ownership interests in a Person.
“Equity Securities” means, collectively, Voting Securities, Convertible
Securities and Rights to Purchase Voting Securities.
“ERISA” means the Employee Retirement Income Security Act of 1974, as amended
from time to time.
“ERISA Affiliate” means any trade or business (whether or not incorporated)
that, together with the Borrower, is treated as a single employer under Section
414(b) or (c) of the Code or, solely for purposes of Section 302 of ERISA and
Section 412 of the Code, is treated as a single employer under Section 414 of
the Code.
“ERISA Event” means (a) any “reportable event”, as defined in Section 4043 of
ERISA or the regulations issued thereunder with respect to a Plan (other than an
event for which the 30-day notice period is waived); (b) any failure by any Plan
to satisfy the minimum funding standards (within the meaning of Section 412 of
the Code or Section 302 of ERISA) applicable to such Plan, whether or not
waived; (c) the filing pursuant to Section 412(c) of the Code or Section 302(c)
of ERISA of an application for a waiver of the minimum funding standard with
respect to any Plan; (d) the incurrence by the Borrower or any of its ERISA
Affiliates of any liability under Title IV of ERISA with respect to the
termination of any Plan; (e) the receipt by the Borrower or any ERISA Affiliate
from the PBGC or a plan administrator of any notice relating to an intention to
terminate any Plan or Plans or to appoint a trustee to administer any Plan;
(f) the incurrence by the Borrower or any of its ERISA Affiliates of any
liability with respect to the withdrawal or partial withdrawal from any Plan or
Multiemployer Plan; or (g) the receipt by the Borrower or any ERISA Affiliate of
any notice, or the receipt by any Multiemployer Plan from the Borrower or any
ERISA Affiliate of any notice, concerning the imposition of Withdrawal Liability
or a determination that a Multiemployer Plan is, or is expected to be, insolvent
or in reorganization, within the meaning of Title IV of ERISA.
“Eurodollar”, when used in reference to any Loan or Borrowing, refers to whether
such Loan, or the Loans comprising such Borrowing, are bearing interest at a
rate determined by reference to the Adjusted LIBO Rate.
“Event of Default” has the meaning assigned to such term in Article VII.
“Excess Availability” means, at any time, an amount equal to (a) the lesser of
(i) the aggregate Revolving Commitments of all Revolving Lenders and (ii) the
Borrowing Base, in each case at such time, minus (b) the aggregate Revolving
Exposure of all Revolving Lenders at such time.
“Exchange Rate” means, on any day, the rate at which Canadian dollars may be
exchanged into dollars, as set forth at approximately 11:00 a.m. (London time)
on such day on the Reuters World Currency Page for Canadian dollars. In the
event that such rate does not appear on any Reuters World Currency Page, the
Exchange Rate shall be determined by reference to such other publicly available
service for displaying exchange rates as may be agreed by the Administrative
Agent and the Borrower, or, in the absence of such agreement, such Exchange Rate
shall instead be the arithmetic average of the spot rates of exchange of the
Administrative Agent in the market where its foreign currency exchange
operations in respect of such currency are then being conducted, at or about
11:00 a.m., local time, on such date for the purchase of the relevant currency
for delivery two Business Days later.

 

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“Excluded Taxes” means, with respect to the Administrative Agent, any Lender,
the Issuing Bank or any other recipient of any payment to be made by or on
account of any obligation of the Borrower hereunder, (a) income or franchise
taxes imposed on (or measured by) its net income by the U.S., or by the
jurisdiction under the laws of which such recipient is organized or in which its
principal office is located or, in the case of any Lender, in which its
applicable lending office is located, (b) any branch profits taxes imposed by
the U.S. or any similar tax imposed by any other jurisdiction described in
clause (a) above and (c) in the case of a Foreign Lender (other than an assignee
pursuant to a request by the Borrower under Section 2.18(b)), any U.S.
withholding tax (i) resulting from any law in effect (including FATCA) at the
time such Foreign Lender becomes a party to this Agreement (or designates a new
lending office), except to the extent that such Foreign Lender (or its assignor,
if any, or, in the case of an SPV, its Granting Lender) was entitled, at the
time of designation of a new lending office (or assignment or grant, as
applicable), to receive additional amounts from the Borrower with respect to any
withholding Tax pursuant to Section 2.16(a), or (ii) attributable to such
Foreign Lender’s failure to comply with Section 2.16(f).
“Existing Credit Agreement” has the meaning assigned to such term in the
preamble hereto.
“Existing Letters of Credit” means the letters of credit previously issued for
the account of the Borrower or any Subsidiary pursuant to the Existing Credit
Agreement that are outstanding thereunder as of the Restatement Effective Date.
“FATCA” means Sections 1471 through 1474 of the Code and any regulations or
official interpretations thereof.
“Federal Funds Effective Rate” means, for any day, the weighted average (rounded
upwards, if necessary, to the next 1/100 of 1%) of the rates on overnight
Federal funds transactions with members of the Federal Reserve System arranged
by Federal funds brokers, as published on the next succeeding Business Day by
the Federal Reserve Bank of New York, or, if such rate is not so published for
any day that is a Business Day, the average (rounded upwards, if necessary, to
the next 1/100 of 1%) of the quotations for such day for such transactions
received by the Administrative Agent from three Federal funds brokers of
recognized standing selected by it.
“Financial Officer” means the chief financial officer, principal accounting
officer, treasurer, assistant treasurer or controller of the Borrower.
“Fixed Charges” means, with reference to any period, without duplication,
(a) the sum of (i) Consolidated Cash Interest Expense for such period and
(ii) any interest accrued and paid in cash during such period in respect of
Indebtedness of the Borrower or any Subsidiary that is required to be
capitalized rather than included in total net consolidated interest expense for
such period in accordance with GAAP, plus (b) principal payments scheduled to be
made by the Borrower or any Subsidiary on Indebtedness during such period
(regardless of whether such payment is actually made in such period, but giving
effect to any reductions thereof resulting from any prepayment thereof in any
earlier period), plus (c) prepayments of principal made by the Borrower or any
Subsidiary on Indebtedness during such period that reduce the scheduled
principal payments in respect of such Indebtedness required to be paid in any
subsequent period, plus (d) expense for Taxes paid in cash during such period,
plus (e) Restricted Payments paid in cash during such period by the Borrower or
any Subsidiary (other than any such Restricted Payments paid to the Borrower or
any Subsidiary), plus (f) cash contributions during such period to any Plan,
plus (g) Capital Lease Obligation payments made during such period, all
calculated for the Borrower and the Subsidiaries on a consolidated basis in
accordance with GAAP. Notwithstanding the foregoing, “Fixed Charges” shall
exclude any amounts referenced in the immediately preceding sentence comprised
of (i) principal payments made, escrowed or otherwise set aside or deposited by
the Borrower in connection with the redemption, repayment, defeasance or other
discharge of the 2014 Notes or (ii) principal payments made in the form of
Indebtedness or Equity Interests issued by the Borrower or any Subsidiary (in
each case, only if such issuance is permitted hereunder) or with the net cash
proceeds of any such issuance that have not otherwise been applied.

 

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“Fixed Charge Coverage Ratio” means the ratio, determined as of the end of each
fiscal quarter of the Borrower for the most-recently ended four fiscal quarters
of the Borrower, of (a) Consolidated EBITDA for such four-fiscal-quarter period
plus the aggregate amount of Transaction Costs incurred or accrued during such
four-fiscal-quarter period minus the unfinanced portion of Capital Expenditures
for such four-fiscal-quarter period to (b) Fixed Charges for such
four-fiscal-quarter period, all calculated for the Borrower and the Subsidiaries
on a consolidated basis in accordance with GAAP.
“Foreign Lender” means any Lender that is organized under the laws of a
jurisdiction other than that in which the Borrower is located. For purposes of
this definition, the U.S., each State thereof and the District of Columbia shall
be deemed to constitute a single jurisdiction.
“Foreign Subsidiary” means any Subsidiary that is not a Domestic Subsidiary.
“Fully Diluted Basis” means, with respect to the determination of whether a
Change in Control has occurred, the Voting Securities that would be outstanding
after giving effect to the conversion or exchange of all outstanding Convertible
Securities and the exercise of all outstanding Rights to Purchase Voting
Securities, in each case, whether or not presently convertible, exchangeable or
exercisable.
“GAAP” means generally accepted accounting principles in the U.S.
“Governmental Authority” means the government of the U.S., any other nation or
any political subdivision thereof, whether state or local, and any agency,
authority, instrumentality, regulatory body, court, central bank or other entity
exercising executive, legislative, judicial, taxing, regulatory or
administrative powers or functions of or pertaining to government (including any
supra-national bodies such as the European Union or the European Central Bank)
having jurisdiction over the Borrower, any Subsidiary or any Lender as the
context may require.
“Granting Lender” has the meaning assigned to such term in Section 9.04(e).
“Guarantee” of or by any Person (the “guarantor”) means any obligation,
contingent or otherwise, of the guarantor guaranteeing or having the economic
effect of guaranteeing any Indebtedness or other obligation of any other Person
(the “primary obligor”) in any manner, whether directly or indirectly, and
including any obligation of the guarantor, direct or indirect, (a) to purchase
or pay (or advance or supply funds for the purchase or payment of) such
Indebtedness or other obligation or to purchase (or to advance or supply funds
for the purchase of) any security for the payment thereof, (b) to purchase or
lease property, securities or services for the purpose of assuring the owner of
such Indebtedness or other obligation of the payment thereof, (c) to maintain
working capital, equity capital or any other financial statement condition or
liquidity of the primary obligor so as to enable the primary obligor to pay such
Indebtedness or other obligation or (d) as an account party in respect of any
letter of credit or letter of guaranty issued to support such Indebtedness or
obligation, provided that the term “Guarantee” shall not include endorsements
for collection or deposit in the ordinary course of business.

 

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“Guarantee Agreement” means the Guarantee Agreement, dated as of January 7,
2009, among the Loan Parties and the Administrative Agent, for the benefit of
the Secured Parties.
“Hazardous Materials” means (a) any petroleum products or byproducts and all
other hydrocarbons, radon gas, asbestos or asbestos-containing materials, urea
formaldehyde foam insulation, polychlorinated biphenyls, chlorofluorocarbons and
all other ozone-depleting substances; or (b) any chemical, material, substance
or waste that is prohibited, limited or regulated by or pursuant to any
Environmental Law.
“Incur” means create, incur, assume, Guarantee or otherwise become responsible
for, and “Incurred” and “Incurrence” shall have correlative meanings.
“Indebtedness” of any Person means, without duplication and excluding trade
accounts payable incurred in the ordinary course of business, (a) all
obligations of such Person for borrowed money or with respect to deposits or
advances of any kind, (b) all obligations of such Person evidenced by bonds,
debentures, notes or similar instruments, (c) all obligations of such Person
upon which interest charges are customarily paid, (d) all obligations of such
Person under conditional sale or other title retention agreements relating to
property acquired by such Person, (e) all obligations of such Person in respect
of the deferred purchase price of property or services, (f) all Indebtedness of
others secured by (or for which the holder of such Indebtedness has an existing
right, contingent or otherwise, to be secured by) any Lien on property owned or
acquired by such Person, whether or not the Indebtedness secured thereby has
been assumed; provided, however, that so long as such Person is not obligated
under such Indebtedness other than with respect to such Lien, such Indebtedness
shall be considered to be Indebtedness of such Person only to the extent of the
lesser of the value of (i) any limit in value of the Lien or (ii) the value of
the property that is subject to any such Lien, (g) all Guarantees by such Person
of Indebtedness of others, (h) all Capital Lease Obligations of such Person,
(i) all obligations, contingent or otherwise, of such Person as an account party
in respect of letters of credit and letters of guaranty, (j) all obligations,
contingent or otherwise, of such Person in respect of bankers’ acceptances and
(k) all Disqualified Equity Interests. The Indebtedness of any Person shall
include the Indebtedness of any other entity (including any partnership in which
such Person is a general partner) to the extent such Person is liable therefor
as a result of such Person’s ownership interest in or other relationship with
such entity, except to the extent the terms of such Indebtedness provide that
such Person is not liable therefor. Notwithstanding the foregoing, in connection
with any acquisition, the term “Indebtedness” shall not include contingent
post-closing purchase price adjustments, non-compete payments or earn-outs to
which the seller in such acquisition may become entitled.
“Indemnified Taxes” means Taxes other than Excluded Taxes.
“Interest Election Request” means a request by the Borrower to convert or
continue a Revolving Borrowing in accordance with Section 2.07.
“Interest Payment Date” means (a) with respect to any ABR Loan (including a
Swingline Loan), the last day of each March, June, September and December and
the Maturity Date and (b) with respect to any Eurodollar Loan, the last day of
the Interest Period applicable to the Borrowing of which such Loan is a part
and, in the case of a Eurodollar Borrowing with an Interest Period of more than
three months’ duration, each day prior to the last day of such Interest Period
that occurs at intervals of three months’ duration after the first day of such
Interest Period.
“Interest Period” means, with respect to any Eurodollar Borrowing, the period
commencing on the date of such Borrowing and ending on the numerically
corresponding day in the calendar month that is one, two, three or six months
thereafter (or nine or twelve months thereafter if, at the time of the relevant
Borrowing, all Lenders participating therein agree to make an interest period of
such duration available), as the Borrower may elect, provided that (a) if any
Interest Period would end on a day other than a Business Day, such Interest
Period shall be extended to the next succeeding Business Day unless such next
succeeding Business Day would fall in the next calendar month, in which case
such Interest Period shall end on the next preceding Business Day and (b) any
Interest Period that commences on the last Business Day of a calendar month (or
on a day for which there is no numerically corresponding day in the last
calendar month of such Interest Period) shall end on the last Business Day of
the last calendar month of such Interest Period. For purposes hereof, the date
of a Borrowing initially shall be the date on which such Borrowing is made and
thereafter shall be the effective date of the most recent conversion or
continuation of such Borrowing.

 

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“Inventory” has the meaning assigned to such term in the Security Agreement.
“Inventory Reserves” shall mean, without duplication of any other applicable
Reserves or eligibility exclusions, reserves against Inventory equal to the sum
of the following:
(a) a reserve for shrink, or discrepancies that arise pertaining to Inventory
quantities on hand between a Collateral Party’s perpetual accounting system and
physical counts of the Inventory which will be based on the applicable
Collateral Party’s historical practice and experience and in an amount
acceptable to the Administrative Agent in its Permitted Discretion;
(b) a reserve determined by the Borrower in accordance with GAAP and
satisfactory to the Administrative Agent in its Permitted Discretion for
Inventory that is discontinued, obsolete, slow-moving, unmerchantable, defective
or unfit for sale;
(c) the lower of the cost or market reserve for any differences between the
applicable Collateral Party’s actual cost to produce such Inventory and the
selling price of such Inventory to third parties;
(d) a reserve whereby capitalized favorable variances under the standard cost
method of accounting shall be deducted from Eligible Inventory and unfavorable
variances thereunder shall not be added to Eligible Inventory;
(e) a reserve for vendor rebates owed to a Collateral Party; and
(f) any other reserve as deemed appropriate by the Administrative Agent in its
Permitted Discretion from time to time.
“Investment Grade Customer” means, with respect to any Inventory that has been
consigned by a Credit Party (as consignor) in accordance with clause (e) of the
definition of “Eligible Inventory”, a customer of the Borrower or any Credit
Party that has, at the time of such consignment and thereafter during the term
of such consignment, a corporate credit rating of at least (a) BBB- by S&P and
(b) Baa3 by Moody’s.
“Issuing Bank” means, as the context may require, (a) (i) JPMCB and (ii) any
other consenting Revolving Lender, in each case satisfactory to the Borrower and
the Administrative Agent, in each case in its capacity as the issuer of Letters
of Credit hereunder, and its successors in such capacity as provided in
Section 2.05(i), and (b) with respect to each Existing Letter of Credit, the
Lender that issued such Existing Letter of Credit. The Issuing Bank may, in its
discretion, arrange for one or more Letters of Credit to be issued by Affiliates
of the Issuing Bank reasonably acceptable to the Borrower, in which case the
term “Issuing Bank” shall include any such Affiliate with respect to Letters of
Credit issued by such Affiliate.

 

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“JPMCB” means JPMorgan Chase Bank, N.A., a national banking association, in its
individual capacity, and its successors.
“LC Disbursement” means a payment made by the Issuing Bank pursuant to a Letter
of Credit.
“LC Exposure” means, at any time, the sum of (a) the aggregate undrawn amount of
all outstanding Letters of Credit at such time and (b) the aggregate amount of
all LC Disbursements that have not yet been reimbursed (including with the
proceeds of Revolving Loans hereunder) by or on behalf of the Borrower at such
time. The LC Exposure of any Revolving Lender at any time shall be its
Applicable Percentage of the aggregate LC Exposure at such time.
“Lenders” means the Persons listed on Schedule 2.01 and any other Person that
shall have become a party hereto pursuant to Section 2.19 or Section 9.04, other
than any such Person that ceases to be a party hereto pursuant to Section 9.04.
Unless the context otherwise requires, the term “Lenders” includes the Swingline
Lender.
“Letter of Credit” means any letter of credit issued pursuant to this Agreement
(including each Existing Letter of Credit).
“LIBO Rate” means, with respect to any Eurodollar Borrowing for any Interest
Period, the rate appearing on the Reuters “LIBOR01” screen displaying British
Bankers’ Association Interest Settlement Rates (or on any successor or
substitute screen provided by Reuters, or any successor to or substitute for
such service, providing rate quotations comparable to those currently provided
on such screen, as determined by the Administrative Agent from time to time for
purposes of providing quotations of interest rates applicable to dollar deposits
in the London interbank market) at approximately 11:00 a.m., London time, two
Business Days prior to the commencement of such Interest Period, as the rate for
dollar deposits with a maturity comparable to such Interest Period. In the event
that such rate is not available at such time for any reason, then the “LIBO
Rate” with respect to such Eurodollar Borrowing for such Interest Period shall
be the rate at which dollar deposits of an amount comparable to the amount of
such Eurodollar Borrowing and for a maturity comparable to such Interest Period
are offered by the principal London office of the Administrative Agent in
immediately available funds in the London interbank market at approximately
11:00 a.m., London time, two Business Days prior to the commencement of such
Interest Period.
“Lien” means, with respect to any asset, (a) any mortgage, deed of trust, lien,
pledge, hypothecation, encumbrance, charge or security interest in, on or of
such asset, (b) the interest of a vendor or a lessor under any conditional sale
agreement, capital lease or title retention agreement (or any financing lease
having substantially the same economic effect as any of the foregoing) relating
to such asset and (c) in the case of securities, any purchase option, call or
similar right of a third party with respect to such securities.
“Liquidity Amount” means, as of any time, the sum of (a) the Excess Availability
at such time plus (b) the aggregate amount of unrestricted and unencumbered cash
and Permitted Liquid Investments (and restricted cash and Permitted Liquid
Investments solely to the extent that such cash and Permitted Liquid Investments
is dedicated to the redemption, repayment, defeasance or other discharge of the
2014 Notes) of the Borrower and its Subsidiaries at such time.

 

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“Loan Documents” means this Agreement, any promissory notes issued pursuant to
this Agreement, the Amendment and Restatement Agreement, the Collateral
Documents, the Guarantee Agreement, the Reaffirmation Agreement and all other
agreements, instruments, documents and certificates identified in Section 4 of
the Amendment and Restatement Agreement executed and delivered to, or in favor
of, the Administrative Agent, the Issuing Bank or any Lender and including all
other pledges, powers of attorney, consents, assignments, contracts, notices and
all other written matter whether heretofore, now or hereafter executed by or on
behalf of any Loan Party, or any employee of any Loan Party, and delivered to
the Administrative Agent, the Issuing Bank or any Lender in connection with this
Agreement or the transactions contemplated hereby. Any reference in this
Agreement or any other Loan Document to a Loan Document shall include all
appendices, exhibits or schedules thereto, and all amendments, restatements,
supplements or other modifications thereto, and shall refer to this Agreement or
such Loan Document as the same may be in effect at any and all times such
reference becomes operative.
“Loan Party” means (a) the Borrower, (b) each Domestic Material Subsidiary,
other than any Domestic Material Subsidiary that is not required to become a
Loan Party in accordance with Section 5.10(a), and (c) each other Domestic
Subsidiary designated by the Borrower, on or after the Restatement Effective
Date, in writing to the Administrative Agent to be a “Loan Party” hereunder to
the extent that the requirements of Section 5.10 have been satisfied with
respect to such Domestic Subsidiary as if such Domestic Subsidiary were a
Domestic Material Subsidiary (it being understood that any such Subsidiary so
designated shall be deemed to be a Material Subsidiary for purposes of the Loan
Documents).
“Loans” means the loans made by the Administrative Agent or the Lenders to the
Borrower pursuant to this Agreement, including Swingline Loans and Overadvances,
as well as any loans made by the Lenders to the Borrower that are outstanding
under the Existing Credit Agreement on the Restatement Effective Date (which
loans shall remain outstanding hereunder on the terms set forth herein).
“Material Adverse Effect” means a material adverse effect on (a) the business,
assets or condition, financial or otherwise, of the Borrower and the
Subsidiaries, taken as a whole, (b) the ability of any Loan Party to perform its
material obligations under any Loan Document or (c) the material rights of or
benefits available to the Lenders under any Loan Document.
“Material Indebtedness” means Indebtedness (other than the Loans and the Letters
of Credit), or obligations in respect of one or more Swap Agreements, of any one
or more of the Borrower and the Subsidiaries in an aggregate principal amount
exceeding $50,000,000. For purposes of determining Material Indebtedness, the
“principal amount” of the obligations of the Borrower or any Subsidiary in
respect of any Swap Agreement at any time shall be the maximum aggregate amount
(giving effect to any netting agreements) that the Borrower or such Subsidiary
would be required to pay if such Swap Agreement were terminated at such time.
“Material Subsidiary” means, at any time, (a) United States Gypsum Company, a
Delaware corporation, (b) USG Interiors, Inc., a Delaware corporation, (c) L&W
Supply Corporation, a Delaware corporation, (d) California Wholesale Material
Supply, LLC, a Delaware limited liability company, (e) Otsego Paper, Inc., a
Delaware corporation, (f) USG Foreign Investments, Ltd., a Delaware corporation,
(g) Livonia Building Materials, LLC, a Michigan limited liability company, and
(h) each other Subsidiary that is, on or after the Restatement Effective Date,
determined to be a “significant subsidiary” (as such term is defined in
Regulation S-X) of the Borrower as and when required to be determined in
accordance with the periodic and current reporting requirements under the
Securities Exchange Act as well as Regulation S-X (it being understood that the
determination as to whether any Subsidiary is a “significant subsidiary” shall
be made at least annually in connection with the preparation of the annual
financial statements of the Borrower).

 

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“Maturity Date” means the Original Maturity Date; provided, however, that if, as
of the Early Maturity Date, a 2014 Notes Event has not occurred, then the
Maturity Date shall be the Early Maturity Date (the occurrence of the event
described in this proviso, an “Early Maturity Event”); provided further,
however, that if a 2014 Notes Event has not occurred prior to the Early Maturity
Date, but as of the Early Maturity Date the Liquidity Amount is equal to or
greater than $500,000,000, then (i) an Early Maturity Event shall be deemed not
to have occurred and (ii) the Maturity Date shall continue to be the Original
Maturity Date unless, as of any time occurring on a date (the “Accelerated
Maturity Date”) after the Early Maturity Date but prior to the Original Maturity
Date, the Liquidity Amount is less than $500,000,000, in which event the
Maturity Date shall be the Accelerated Maturity Date. In addition, if (A) the
2014 Notes Documents have been amended in order to cause a 2014 Notes Event as
set forth in clause (b) of the definition thereof, or if the 2014 Notes have
been refinanced with Indebtedness in order to cause a 2014 Notes Event as set
forth in clause (c) of the definition thereof, and (B) the 2014 Notes Documents
(or the operative documents in respect of any such refinancing Indebtedness) are
subsequently amended or modified such that the conditions set forth in such
clause (b) or (c), as the case may be, of the definition “2014 Notes Event” are
no longer satisfied, then the Maturity Date shall be the date of such amendment
or modification (or, if such amendment or modification occurs before the Early
Maturity Date, shall be the Early Maturity Date).
“Moody’s” means Moody’s Investors Service, Inc.
“Multiemployer Plan” means a multiemployer plan as defined in Section 4001(a)(3)
of ERISA.
“Net Orderly Liquidation Value” means, with respect to Inventory of any Person,
the orderly liquidation value thereof as determined in a manner acceptable to
the Administrative Agent by an appraiser acceptable to the Administrative Agent
in its Permitted Discretion (including pursuant to an appraisal requested by the
Borrower in accordance with Section 5.07(c)), net of all costs of liquidation
thereof.
“Non-Consenting Lender” has the meaning assigned to such term in
Section 9.02(c).
“Obligations” means (a) the due and punctual payment by the Borrower of (i) the
principal of and interest (including interest accruing during the pendency of
any bankruptcy, insolvency, receivership or other similar proceeding, regardless
of whether allowed or allowable in such proceeding) on the Loans, when and as
due, whether at maturity, by acceleration, upon one or more dates set for
prepayment or otherwise, (ii) each payment required to be made by the Borrower
under this Agreement in respect of any Letter of Credit, when and as due,
including payments in respect of reimbursement of disbursements, interest
thereon and obligations to provide cash collateral, and (iii) all other monetary
obligations of the Borrower to any of the Secured Parties under any Loan
Document, including obligations to pay fees, expense reimbursement obligations
and indemnification obligations, whether primary, secondary, direct, contingent,
fixed or otherwise (including monetary obligations incurred during the pendency
of any bankruptcy, insolvency, receivership or other similar proceeding,
regardless of whether allowed or allowable in such proceeding), (b) the due and
punctual performance of all other obligations of the Borrower under or pursuant
to any Loan Document and (c) the due and punctual payment and performance of all
the obligations of each other Loan Party under or pursuant to each Loan
Document.
“Original Maturity Date” means December 21, 2015, or any earlier date on which
the Revolving Commitments are reduced to zero or are otherwise terminated
pursuant to the terms hereof.
“Other Taxes” means any and all present or future recording, stamp, documentary,
excise, transfer, sales, property or similar taxes, charges or levies arising
from any payment made under any Loan Document or from the execution, delivery or
enforcement of, or otherwise with respect to, any Loan Document.

 

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“Overadvance” has the meaning assigned to such term in Section 2.04(d).
“Parent” means, with respect to any Revolving Lender, any Person as to which
such Revolving Lender is, directly or indirectly, a subsidiary.
“Participant” has the meaning assigned to such term in Section 9.04(c)(i).
“Participant Register” has the meaning assigned to such term in
Section 9.04(c)(ii).
“PBGC” means the Pension Benefit Guaranty Corporation referred to and defined in
ERISA and any successor entity performing similar functions.
“Perfection Certificate” means a certificate, dated as of the Restatement
Effective Date, delivered by the Borrower on behalf of the Collateral Parties
and in the form of Exhibit G.
“Permitted Discretion” means a determination made in good faith and in the
exercise of reasonable (from the perspective of a secured asset-based lender)
business judgment.
“Permitted Encumbrances” means:
(a) Liens imposed by law for taxes, assessments or other governmental charges
that are not yet due or are being contested in compliance with Section 5.04;
(b) carriers’, warehousemen’s, mechanics’, materialmen’s, repairmen’s,
landlords’ and other like Liens imposed by law, arising in the ordinary course
of business and securing obligations that are not overdue by more than 30 days
or are being contested in compliance with Section 5.04;
(c) pledges and deposits made in the ordinary course of business in compliance
with workers’ compensation, unemployment insurance and other social security
laws or regulations;
(d) pledges and deposits to secure the performance of bids, trade contracts,
leases, tenders, statutory obligations, surety, stay, customs and appeal bonds,
performance bonds and other obligations of a like nature, in each case in the
ordinary course of business;
(e) judgment liens in respect of judgments that do not constitute an Event of
Default under clause (k) of Article VII;
(f) easements, zoning restrictions, rights-of-way, covenants and similar
encumbrances on real property that do not secure any monetary obligations and do
not materially detract from the value of the affected property or materially
interfere with the ordinary conduct of business of the Borrower or any
Subsidiary;
(g) Liens created by sale contracts documenting unconsummated asset dispositions
permitted pursuant to this Agreement, provided that such Liens attach only to
assets subject to such sales contracts;
(h) Liens consisting of the interest of the lessee under any lease or sublease
granted to others by the Borrower or its Subsidiaries in its ordinary course of
business, provided that such Liens attach only to the assets subject to such
lease or sublease;

 

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(i) customary rights of setoff, revocation, refund or chargeback under deposit
agreements or under the UCC of banks or other financial institutions where the
Borrower or any Subsidiary maintains deposits in the ordinary course of
business;
(j) Liens arising from the granting of a license to any Person in the ordinary
course of business of the Borrower or any Subsidiary, provided that such Liens
attach only to the assets subject to such license and the granting of such
license is permitted hereunder;
(k) Liens attaching to cash earnest money deposits made by the Borrower or any
Subsidiary in connection with any letter of intent or purchase agreement
permitted under Section 6.04;
(l) Liens arising by operation of law or contract on insurance policies and the
proceeds thereof to secure premiums thereunder;
(m) Liens incurred with respect to rights of agents for collection for the
Borrower and the Subsidiaries under assignments of chattel paper, accounts,
instruments or general intangibles for purposes of collection in the ordinary
course of business;
(n) Liens in favor of customs and revenues authorities that secure payment of
customs duties in connection with the importation of goods, provided that such
Liens attach solely to such goods being so imported and in respect of which such
duties are owing;
(o) Liens representing any interest or title of a licensor, lessor, sublicensor
or sublessor under any lease or license permitted by this Agreement; and
(p) Liens on consigned Inventory of the Loan Parties (in an aggregate amount not
in excess of $15,000,000) in favor of the creditors of the consignees thereof,
provided that the term “Permitted Encumbrances” shall not include any Lien
securing Indebtedness.
“Permitted Investments” means any investment permitted pursuant to the
Borrower’s Statement of Investment Objective and Guidelines in effect on the
Restatement Effective Date as set forth on Schedule 1.01(a), as the same may be
amended from time to time in a manner not adverse to the Lenders unless
otherwise consented to in writing by the Administrative Agent (such consent not
to be unreasonably withheld).
“Permitted Liquid Investments” means:
(a) direct obligations of, or obligations the principal of and interest on which
are unconditionally guaranteed by, the United States of America (or by any
agency thereof to the extent such obligations are backed by the full faith and
credit of the United States of America), in each case maturing within one year
from the date of acquisition thereof;
(b) investments in commercial paper maturing within 270 days from the date of
acquisition thereof and having, at such date of acquisition, the highest credit
rating obtainable from S&P or from Moody’s;
(c) investments in certificates of deposit, banker’s acceptances and time or
demand deposits maturing within 180 days from the date of acquisition thereof
issued or guaranteed by or placed with, and money market deposit accounts issued
or offered by, any domestic office of any commercial bank organized under the
laws of the United States of America or any State thereof that has a combined
capital and surplus and undivided profits of not less than $500,000,000;

 

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(d) fully collateralized repurchase agreements with a term of not more than
30 days for securities described in clause (a) above and entered into with a
financial institution satisfying the criteria described in clause (c) above; and
(e) “money market funds” that (i) comply with the criteria set forth in
Rule 2a-7 of the Investment Company Act, (ii) are rated AAA by S&P and Aaa by
Moody’s and (iii) have portfolio assets of at least $5,000,000,000.
“Person” means any natural person, corporation, limited liability company,
trust, joint venture, association, company, partnership, Governmental Authority
or other entity.
“Plan” means any employee pension benefit plan (other than a Multiemployer Plan)
subject to the provisions of Title IV of ERISA or Section 412 of the Code or
Section 302 of ERISA sponsored, maintained or contributed to by the Borrower or
any ERISA Affiliate.
“Poison Pill” means any plan, agreement, rights, securities or instruments that
are commonly referred to as a “poison pill” because they have the effect of
diluting or otherwise discriminating against a particular “acquiring person” (or
any similar term) by reason of such person’s ownership of a particular amount of
Voting Securities.
“Prime Rate” means the rate of interest per annum publicly announced from time
to time by JPMCB as its prime rate in effect at its principal office in New York
City; each change in the Prime Rate shall be effective from and including the
date such change is publicly announced as being effective.
“Pro Forma Basis” means, with respect to the determination of Consolidated
EBITDA as of any date, that such calculation shall give pro forma effect to all
acquisitions, all issuances, incurrences or assumptions of Indebtedness (with
any such Indebtedness being deemed to be amortized over the applicable testing
period in accordance with its terms) and all sales, transfers or other
dispositions of any material assets outside the ordinary course of business that
have occurred during the four consecutive fiscal quarter period of the Borrower
most-recently ended on or prior to such date as if they occurred on the first
day of such four consecutive fiscal quarter period (including cost savings to
the extent such cost savings would be permitted to be reflected in pro forma
financial information complying with the requirements of GAAP and Article XI of
Regulation S-X, as interpreted by the Staff of the SEC, and as certified by a
Financial Officer).
“Qualified Equity Interests” means Equity Interests of the Borrower other than
Disqualified Equity Interests.
“Reaffirmation Agreement” means the Reaffirmation Agreement dated as of the
Restatement Effective Date, substantially in the form of Exhibit I hereto.
“Register” has the meaning assigned to such term in Section 9.04(b)(iv).
“Regulation S-X” means Regulation S-X as promulgated by the SEC.
“Related Parties” means, with respect to any specified Person, such Person’s
Affiliates and the respective directors, officers, employees, agents and
advisors of such Person and such Person’s Affiliates.

 

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“Release” means any release, spill, emission, leaking, dumping, injection,
pouring, deposit, disposal, discharge, dispersal, leaching or migration into or
through the environment (including ambient air, surface water, groundwater, land
surface or subsurface strata) or within or upon any building, structure,
facility or fixture.
“Rent Reserve” means, with respect to any warehouse, distribution center or
other location not owned by a Collateral Party where Inventory on-hand having a
book value of at least $100,000 is located and with respect to which no
Collateral Access Agreement is in effect, a reserve equal to (a) three months’
rent in the case of leased facilities and (b) three months of fees in the case
of third-party warehouses and outside processors.
“Report” means reports prepared by the Administrative Agent or another Person
showing the results of appraisals, field examinations or audits with respect to
the Inventory of the Collateral Parties or the books and records relating to the
Accounts of the Collateral Parties from information furnished by or on behalf of
the Collateral Parties, after the Administrative Agent has exercised its rights
of inspection, field examination or appraisal pursuant to this Agreement, which
Reports may be distributed to the Lenders by the Administrative Agent.
“Required Lenders” means, at any time, Lenders having Revolving Exposure and
unused Revolving Commitments representing more than 50% of the aggregate
Revolving Exposure and unused Revolving Commitments at such time.
“Requirement of Law” means, with respect to any Person, (a) the charter,
articles or certificate of organization or incorporation and bylaws or other
organizational or governing documents of such Person and (b) any statute, law,
treaty, rule, regulation, order, decree, writ, injunction or determination of
any arbitrator or court or other Governmental Authority (including Environmental
Laws), in each case applicable to or binding upon such Person or any of its
property or to which such Person or any of its property is subject.
“Reserves” means Rent Reserves and any other reserves that the Administrative
Agent deems necessary, in its Permitted Discretion, to maintain with respect to
the Collateral or any Collateral Party, provided that such reserves have been
established upon not less than three Business Days’ notice to the Borrower.
“Restatement Effective Date” has the meaning assigned to such term in the
Amendment and Restatement Agreement.
“Restatement Transactions” means the execution and delivery of the Amendment and
Restatement Agreement by each Person party thereto and the satisfaction of the
conditions to the effectiveness thereof.
“Restricted Collateral Party” means each of L&W Supply Corporation, a Delaware
corporation, United States Gypsum Company, a Delaware corporation, USG
Interiors, Inc., a Delaware corporation, and California Wholesale Material
Supply, LLC, a Delaware limited liability company.
“Restricted Group” means, collectively, (a) Berkshire, (b) any Controlled
Affiliate of Berkshire and (c) any group (that would be deemed to be a “person”
by Section 13(d)(3) of the Securities Exchange Act with respect to the
securities of the Borrower) of which Berkshire or any Person directly or
indirectly Controlling, Controlled by or under common Control with Berkshire is
a member. For purposes of this definition, “Affiliate” and “Control” have the
respective meanings given to such terms under Rule 405 under the Securities Act
of 1933, as amended (and “Controlled” and “Controlling” shall have correlative
meanings), provided that no Person shall be deemed to Control another Person
solely by his or her status as a director of such other Person.

 

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“Restricted Payment” means any dividend or other distribution (whether in cash,
securities or other property) with respect to any Equity Interests in the
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, cancelation or termination of any
Equity Interests in the Borrower or any Subsidiary or any option, warrant or
other right to acquire any such Equity Interests in the Borrower or any
Subsidiary, or any other payment (including any payment under any equity Swap
Agreement) that has a substantially similar effect to any of the foregoing. For
purposes of clarity, neither (a) the conversion of convertible Indebtedness of
the Borrower or any Subsidiary into Equity Interests in accordance with the
terms of such Indebtedness nor (b) the repayment, redemption, defeasance or
other discharge of any such convertible Indebtedness prior to the conversion
thereof into Equity Interests, shall be a Restricted Payment.
“Revolving Borrowing” means a Borrowing comprised of Revolving Loans.
“Revolving Commitment” means, with respect to each Lender, the commitment, if
any, of such Lender to make Revolving Loans and to acquire participations in
Letters of Credit, Swingline Loans and Overadvances hereunder, expressed as an
amount representing the maximum possible aggregate amount of such Lender’s
Revolving Exposure hereunder, as such commitment may be (a) reduced from time to
time pursuant to Section 2.08, Section 2.18(b) or Section 9.02(c), (b) reduced
or increased from time to time pursuant to assignments by or to such Lender,
respectively, pursuant to Section 9.04 and (c) increased from time to time
pursuant to Revolving Commitment Increases made pursuant to Section 2.19. The
initial amount of each Lender’s Revolving Commitment is set forth on the
Schedule 2.01, or in the Assignment and Assumption or Commitment Increase
Amendment pursuant to which such Lender shall have assumed its Revolving
Commitment, as the case may be. The initial aggregate amount of the Lenders’
Revolving Commitments on the Restatement Effective Date is $400,000,000.
“Revolving Commitment Increase” has the meaning assigned to such term in Section
2.19(b).
“Revolving Exposure” means, with respect to any Lender at any time, (a) the sum
of the outstanding principal amount of such Lender’s Revolving Loans and its LC
Exposure and Swingline Exposure at such time plus (b) an amount equal to its
Applicable Percentage, if any, of the aggregate principal amount of Overadvances
at such time.
“Revolving Lender” means a Lender with a Revolving Commitment or, if the
Revolving Commitments have terminated or expired, a Lender with Revolving
Exposure.
“Revolving Loan” means a Loan made pursuant to Section 2.01.
“Rights to Purchase Voting Securities” means options, warrants and rights issued
by the Borrower (whether presently exercisable or not) to purchase Voting
Securities or Convertible Securities, excluding any rights issued under any
Poison Pill.
“S&P” means Standard & Poor’s Ratings Services, a division of The McGraw-Hill
Companies, Inc.
“SEC” means the Securities and Exchange Commission or any Governmental Authority
succeeding to any of its principal functions.

 

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“SEC Filing” has the meaning assigned to such term in Section 3.11.
“Secured Obligations” means all Obligations, together with (a) Banking Services
Obligations and (b) Swap Obligations owing to one or more Lenders or their
respective Affiliates, provided that, except with respect to Swap Obligations
owing to one or more of the Lenders or their respective Affiliates as of the
Restatement Effective Date, not later than the date that is ten calendar days
after the date that any transaction relating to such Swap Obligation is executed
(or amended, supplemented or otherwise modified to designate such Swap
Obligations as Secured Obligations), the Lender (or the applicable Affiliate)
party thereto (other than JPMCB) shall have delivered written notice to the
Administrative Agent that such a transaction has been entered into (or has been
amended, supplemented or otherwise modified, as the case may be) and that it
constitutes a Secured Obligation entitled to the benefits of the Collateral
Documents. Notwithstanding the foregoing, for purposes of clause (b) of this
defined term, the amount of Swap Obligations owing to one or more of the Lenders
or their respective Affiliates at any time shall be deemed to be reduced by the
aggregate amount of cash collateral provided in respect of such Swap Obligations
at such time pursuant to cash collateralization terms agreed to by the
applicable counterparties to such Swap Obligations.
“Secured Parties” means (a) the Lenders, (b) the Administrative Agent, (c) the
Issuing Bank, (d) each counterparty to any Swap Agreement with a Loan Party the
obligations under which constitute Secured Obligations, (e) each provider of
Banking Services which constitute Secured Obligations, (f) the beneficiaries of
each indemnification obligation undertaken by any Loan Party under any Loan
Document and (g) the successors and assigns of each of the foregoing.
“Securities Exchange Act” means the Securities Exchange Act of 1934, as amended.
“Security Agreement” means that certain Pledge and Security Agreement, dated as
of January 7, 2009, among the Collateral Parties and the Administrative Agent,
for the benefit of the Secured Parties.
“SPV” has the meaning assigned to such term in Section 9.04(e).
“Statutory Reserve Rate” means a fraction (expressed as a decimal), the
numerator of which is the number one and the denominator of which is the number
one minus the aggregate of the maximum reserve percentages (including any
marginal, special, emergency or supplemental reserves) expressed as a decimal
established by the Board to which the Administrative Agent is subject with
respect to the Adjusted LIBO Rate, for eurocurrency funding (currently referred
to as “Eurocurrency Liabilities” in Regulation D of the Board). Such reserve
percentages shall include those imposed pursuant to such Regulation D.
Eurodollar Loans shall be deemed to constitute eurocurrency funding and to be
subject to such reserve requirements without benefit of or credit for proration,
exemptions or offsets that may be available from time to time to any Lender
under such Regulation D or any comparable regulation. The Statutory Reserve Rate
shall be adjusted automatically on and as of the effective date of any change in
any reserve percentage.
“subsidiary” means, with respect to any Person (the “parent”) at any date, any
corporation, limited liability company, partnership, association or other entity
the accounts of which would be consolidated with those of the parent in the
parent’s consolidated financial statements if such financial statements were
prepared in accordance with GAAP, as well as any other corporation, limited
liability company, partnership, association or other entity of which securities
or other ownership interests representing more than 50% of the equity or more
than 50% of the ordinary voting power or, in the case of a partnership, more
than 50% of the general partnership interests are, as of such date, owned,
controlled or held.

 

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“Subsidiary” means any direct or indirect subsidiary of the Borrower.
“Swap Agreement” means any agreement with respect to any swap, forward, future
or derivative transaction or option or similar agreement involving, or settled
by reference to, one or more rates, currencies, commodities, equity or debt
instruments or securities, or economic, financial or pricing indices or measures
of economic, financial or pricing risk or value or any similar transaction or
any combination of these transactions, provided that no phantom stock or similar
plan providing for payments only on account of services provided by current or
former directors, officers, employees or consultants of the Borrower or the
Subsidiaries shall be a Swap Agreement.
“Swap Obligations” of a Loan Party means any and all obligations (including
obligations existing as of the Restatement Effective Date) of such Loan Party,
whether absolute or contingent and howsoever and whensoever created, arising,
evidenced or acquired (including all renewals, extensions and modifications
thereof and substitutions therefor), under (a) any and all Swap Agreements and
(b) any and all cancelations, buy backs, reversals, terminations or assignments
of any Swap Agreement transaction.
“Swingline Commitment” means the commitment of the Swingline Lender to make
Swingline Loans.
“Swingline Exposure” means, at any time, the aggregate principal amount of all
Swingline Loans outstanding at such time. The Swingline Exposure of any Lender
at any time shall be its Applicable Percentage of the Swingline Exposure at such
time.
“Swingline Lender” means JPMorgan Chase Bank, N.A., in its capacity as lender of
Swingline Loans hereunder.
“Swingline Loan” means a Loan made pursuant to Section 2.04.
“Taxes” means any and all present or future taxes, levies, imposts, duties,
deductions, charges or withholdings imposed by any Governmental Authority.
“Threshold Amount” means, at any time, an amount equal to the greater of (a)
$60,000,000 and (b) 20% of the lesser of (i) the aggregate Revolving Commitments
at such time and (ii) the Borrowing Base at such time.
“Transaction Costs” means all fees, costs and expenses incurred or payable by
the Borrower or any Subsidiary in connection with the Transactions, including
fees payable on the Restatement Effective Date pursuant to fee letters between
the Administrative Agent and the Borrower.
“Transactions” means (a) the execution, delivery and performance by the Loan
Parties of this Agreement and the other Loan Documents to which they are party,
the borrowing of Loans, the use of the proceeds thereof and the issuance of
Letters of Credit hereunder (including the Restatement Transactions) and (b) the
payment of the Transaction Costs.
“Type”, when used in reference to any Loan or Borrowing, refers to whether the
rate of interest on such Loan, or on the Loans comprising such Borrowing, is
determined by reference to the Adjusted LIBO Rate or the Alternate Base Rate.
“UCC” means the Uniform Commercial Code as in effect from time to time in the
State of New York or any other state the laws of which are required to be
applied in connection with the issue of perfection of security interests.

 

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“U.S.” means the United States of America.
“Vessel Loan Agreement” means the US$90,000,000 Secured Loan Agreement dated
October 21, 2008, among Gypsum Transportation Limited, the lenders from time to
time party thereto and DVB Bank SE, as agent and security trustee.
“Voting Securities” means the common stock and any other securities of the
Borrower of any kind or class having power generally to vote for the election of
directors of the Borrower.
“wholly owned Subsidiary” means, with respect to any Person at any date, a
subsidiary of such Person of which securities or other ownership interests
representing 100% of the Equity Interests (other than directors’ qualifying
shares) are, as of such date, owned, controlled or held by such Person or one or
more wholly owned Subsidiaries of such Person or by such Person and one or more
wholly owned Subsidiaries of such Person. Unless otherwise specified, “wholly
owned Subsidiary” means a wholly owned Subsidiary of the Borrower.
“Withdrawal Liability” means liability to a Multiemployer Plan as a result of a
complete or partial withdrawal from such Multiemployer Plan, as such terms are
defined in Part I of Subtitle E of Title IV of ERISA.
“Withholding Agent” means the Loan Party making the payment potentially subject
to withholding or the Administrative Agent.
SECTION 1.02. Classification of Loans and Borrowings. For purposes of this
Agreement, Loans may be classified and referred to by Type (e.g., a “Eurodollar
Loan”). Borrowings also may be classified and referred to by Type (e.g., a
“Eurodollar Borrowing”).
SECTION 1.03. Terms Generally. The definitions of terms herein shall apply
equally to the singular and plural forms of the terms defined. Whenever the
context may require, any pronoun shall include the corresponding masculine,
feminine and neuter forms. The words “include”, “includes” and “including” shall
be deemed to be followed by the phrase “without limitation”. The word “will”
shall be construed to have the same meaning and effect as the word “shall”.
Unless the context requires otherwise, (a) any definition of or reference to any
agreement, instrument or other document herein (other than the Existing Credit
Agreement) shall be construed as referring to such agreement, instrument or
other document as from time to time amended, amended and restated, supplemented
or otherwise modified (subject to any restrictions on such amendments,
supplements or modifications set forth herein), (b) any reference herein to any
Person shall be construed to include such Person’s successors and assigns,
(c) the words “herein”, “hereof” and “hereunder”, and words of similar import,
shall be construed to refer to this Agreement in its entirety and not to any
particular provision hereof, (d) all references herein to Articles, Sections,
Exhibits and Schedules shall be construed to refer to Articles and Sections of,
and Exhibits and Schedules to, this Agreement and (e) the words “asset” and
“property” shall be construed to have the same meaning and effect and to refer
to any and all tangible and intangible assets and properties, including cash,
securities, accounts and contract rights.
SECTION 1.04. Accounting Terms; GAAP. Except as otherwise expressly provided
herein, all terms of an accounting or financial nature shall be construed in
accordance with GAAP, as in effect from time to time, provided that (i) if the
Borrower notifies the Administrative Agent that the Borrower requests an
amendment to any provision (including any definition) hereof to eliminate the
effect of any change occurring after the Restatement Effective Date in GAAP or
in the application thereof on the operation of such provision (or if the
Administrative Agent notifies the Borrower that the Required Lenders request an
amendment to any provision hereof for such purpose), regardless of whether any
such notice is given before or after such change in GAAP or in the application
thereof, then such provision shall be interpreted on the basis of GAAP as in
effect and applied immediately before such change shall have become effective
until such notice shall have been withdrawn or such provision amended in
accordance herewith and (ii) notwithstanding any other provision contained
herein, all terms of an accounting or financial nature used herein shall be
construed, and all computations of amounts and ratios referred to herein shall
be made, without giving effect to any elections under Statement of Financial
Accounting Standards 159, The Fair Value Option for Financial Assets and
Financial Liabilities, or any successor thereto (including pursuant to
Accounting Standard Codifications), to value any Indebtedness of the Borrower or
any Subsidiary at “fair value”, as defined therein.

 

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SECTION 1.05. Pro Forma Calculations. With respect to any period during which
any acquisition, sale, transfer or other disposition of any material assets
outside the ordinary course of business occurs, for purposes of determining
Consolidated EBITDA, calculations with respect to such period shall be made on a
Pro Forma Basis.
ARTICLE II
The Credits
SECTION 2.01. Revolving Commitments. Subject to the terms and conditions set
forth herein, each Lender agrees to make Revolving Loans to the Borrower from
time to time during the Availability Period in an aggregate principal amount
that will not result in (a) such Lender’s Revolving Exposure exceeding such
Lender’s Revolving Commitment or (b) the aggregate Revolving Exposures exceeding
the lesser of (x) the aggregate Revolving Commitments and (y) the Borrowing
Base, in each case at such time, subject to the Administrative Agent’s
authority, in its sole discretion, to make Overadvances pursuant to the terms of
Section 2.04. Within the foregoing limits and subject to the terms and
conditions set forth herein, the Borrower may borrow, prepay and reborrow
Revolving Loans. All Loans shall be made in dollars. All Revolving Loans,
Swingline Loans and Letters of Credit outstanding under the Existing Credit
Agreement on the Restatement Effective Date shall remain outstanding hereunder
on the terms set forth herein.
SECTION 2.02. Loans and Borrowings. (a) Each Loan (other than a Swingline Loan
or Overadvance) shall be made as part of a Borrowing consisting of Loans of the
same Type made by the Lenders ratably in accordance with their respective
Revolving Commitments. Any Overadvance and any Swingline Loan shall be made in
accordance with the procedures set forth in Section 2.04. The failure of any
Lender to make any Loan required to be made by it hereunder shall not relieve
any other Lender of its obligations hereunder, provided that the Commitments of
the Lenders are several and no Lender shall be responsible for any other
Lender’s failure to make Loans as required.
(b) Subject to Section 2.13, each Revolving Borrowing shall be comprised
entirely of ABR Loans or Eurodollar Loans as the Borrower may request in
accordance herewith. Each Swingline Loan and Overadvance shall be an ABR Loan.
Each Lender at its option may make any Eurodollar Loan by causing any domestic
or foreign branch or Affiliate of such Lender to make such Loan, provided that
any exercise of such option shall not affect the obligation of the Borrower to
repay such Loan in accordance with the terms of this Agreement.
(c) At the commencement of each Interest Period for any Eurodollar Borrowing,
such Borrowing shall be in an aggregate amount that is an integral multiple of
$1,000,000 and not less than $5,000,000. At the time that each ABR Revolving
Borrowing is made, such Borrowing shall be in an aggregate amount that is an
integral multiple of $1,000,000 and not less than $1,000,000. Each Swingline
Loan shall be in an amount that is not less than $500,000. Borrowings of more
than one Type may be outstanding at the same time, provided that there shall not
at any time be more than a total of ten Eurodollar Borrowings outstanding.
Notwithstanding anything to the contrary in this Section 2.02(c), an ABR
Revolving Borrowing or a Swingline Loan may be in an aggregate amount that is
equal to the entire unused balance of the aggregate Revolving Commitments or
that is required to finance the reimbursement of an LC Disbursement as
contemplated by Section 2.05(e).

 

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(d) Notwithstanding any other provision of this Agreement, the Borrower shall
not be entitled to request, or to elect to convert or continue, any Borrowing if
the Interest Period requested with respect thereto would end after the Original
Maturity Date.
SECTION 2.03. Requests for Borrowings. To request a Revolving Borrowing, the
Borrower shall notify the Administrative Agent of such request by telephone
(a) in the case of a Eurodollar Borrowing, not later than 11:00 a.m., New York
City time, three Business Days before the date of the proposed Borrowing or
(b) in the case of an ABR Borrowing, not later than 11:00 a.m., New York City
time, one Business Day before the date of the proposed Borrowing, provided that
any such notice of an ABR Revolving Borrowing to finance the reimbursement of an
LC Disbursement as contemplated by Section 2.05(e) may be given not later than
10:00 a.m., New York City time, on the date of the proposed Borrowing. Each such
telephonic Borrowing Request shall be irrevocable and shall be confirmed
promptly by hand delivery or telecopy or Adobe pdf file to the Administrative
Agent of a written Borrowing Request substantially in the form of Exhibit C
signed by the Borrower. Each such telephonic and written Borrowing Request shall
specify the following information:
(i) the aggregate amount of such Borrowing;
(ii) the date of such Borrowing, which shall be a Business Day;
(iii) whether such Borrowing is to be an ABR Borrowing or a Eurodollar
Borrowing;
(iv) in the case of a Eurodollar Borrowing, the initial Interest Period to be
applicable thereto, which shall be a period contemplated by the definition of
the term “Interest Period”;
(v) the location and number of the Borrower’s account to which funds are to be
disbursed, which shall comply with the requirements of Section 2.06; and
(vi) that as of such date the conditions set forth in Sections 4.02(a) and
(b) are satisfied.
If no election as to the Type of Revolving Borrowing is specified, then the
requested Revolving Borrowing shall be an ABR Borrowing. If no Interest Period
is specified with respect to any requested Eurodollar Revolving Borrowing, then
the Borrower shall be deemed to have selected an Interest Period of one month’s
duration. Promptly following receipt of a Borrowing Request in accordance with
this Section, the Administrative Agent shall advise each Lender of the details
thereof and of the amount of such Lender’s Loan to be made as part of the
requested Borrowing.
SECTION 2.04. Swingline Loans and Overadvances. (a) Subject to the terms and
conditions set forth herein, the Swingline Lender agrees to make Swingline Loans
to the Borrower from time to time during the Availability Period, in an
aggregate principal amount at any time outstanding that will not result in
(i) the aggregate principal amount of outstanding Swingline Loans exceeding
$40,000,000 or (ii) the aggregate Revolving Exposures exceeding the lesser of
(x) the aggregate Revolving Commitments and (y) the Borrowing Base, in each case
at such time, provided that the Swingline Lender shall not be required to make a
Swingline Loan to refinance an outstanding Swingline Loan. Within the foregoing
limits and subject to the terms and conditions set forth herein, the Borrower
may borrow, prepay and reborrow Swingline Loans.

 

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(b) To request a Swingline Loan, the Borrower shall notify the Administrative
Agent of such request by telephone (confirmed by telecopy or by Adobe pdf file),
not later than 12:00 noon, New York City time, on the day of such proposed
Swingline Loan. Each such notice shall be irrevocable and shall specify the
requested date (which shall be a Business Day) and amount of the requested
Swingline Loan. The Administrative Agent will promptly advise the Swingline
Lender of any such notice received from the Borrower. The Swingline Lender shall
make each Swingline Loan available to the Borrower by means of a credit to the
general deposit account of the Borrower maintained with the Swingline Lender (or
(i) in the case of a Swingline Loan made to finance the reimbursement of an LC
Disbursement as provided in Section 2.05(e), by remittance to the Issuing Bank
or, to the extent that the Revolving Lenders have made payments pursuant to
Section 2.05(e) to reimburse the Issuing Bank, to such Lenders and the Issuing
Bank as their interests may appear and (ii) in the case of a Swingline Loan made
to finance the repayment of another Loan or fees or expenses as provided by
Section 2.17(c), by remittance to the Administrative Agent to be distributed to
the Lenders as their interests may appear) by 3:00 p.m., New York City time, on
the requested date of such Swingline Loan.
(c) The Swingline Lender may by written notice given to the Administrative Agent
not later than 12:00 noon, New York City time, on any Business Day (but, in any
event with respect to a Swingline Loan, not later than seven Business Days after
such Swingline Loan was funded by the Swingline Lender), require the Revolving
Lenders to acquire participations on such Business Day in all or a portion of
the Swingline Loans outstanding. Such notice shall specify the aggregate amount
of Swingline Loans in which Revolving Lenders will participate. Promptly upon
receipt of such notice, the Administrative Agent will give notice thereof to
each Revolving Lender, specifying in such notice such Lender’s Applicable
Percentage of such Swingline Loan or Swingline Loans. Each Revolving Lender
hereby absolutely and unconditionally agrees, upon receipt of notice as provided
above, to pay to the Administrative Agent, for the account of the Swingline
Lender, such Lender’s Applicable Percentage of such Swingline Loan or Swingline
Loans. Each Revolving Lender acknowledges and agrees that its obligation to
acquire participations in Swingline Loans pursuant to this paragraph is absolute
and unconditional and shall not be affected by any circumstance whatsoever,
including the occurrence and continuance of a Default or reduction or
termination of the Revolving Commitments, and that each such payment shall be
made without any offset, abatement, withholding or reduction whatsoever. Each
Revolving Lender shall comply with its obligation under this paragraph by wire
transfer of immediately available funds, in the same manner as provided in
Section 2.06 with respect to Loans made by such Lender (and Section 2.06 shall
apply, mutatis mutandis, to the payment obligations of the Revolving Lenders),
and the Administrative Agent shall promptly pay to the Swingline Lender the
amounts so received by it from the Revolving Lenders. The Administrative Agent
shall notify the Borrower of any participations in any Swingline Loan acquired
pursuant to this paragraph, and thereafter payments in respect of such Swingline
Loan shall be made to the Administrative Agent and not to the Swingline Lender.
Any amounts received by the Swingline Lender from the Borrower (or other party
on behalf of the Borrower) in respect of a Swingline Loan after receipt by the
Swingline Lender of the proceeds of a sale of participations therein shall be
promptly remitted to the Administrative Agent; any such amounts received by the
Administrative Agent shall be promptly remitted by the Administrative Agent to
the Revolving Lenders that shall have made their payments pursuant to this
paragraph and to the Swingline Lender, as their interests may appear, provided
that any such payment so remitted shall be repaid to the Swingline Lender or the
Administrative Agent, as the case may be, if and to the extent such payment is
required to be refunded to the Borrower for any reason. The purchase of
participations in a Swingline Loan pursuant to this paragraph shall not relieve
the Borrower of any default in the payment thereof.

 

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(d) Any provision of this Agreement to the contrary notwithstanding, at the
request of the Borrower, the Administrative Agent may in its sole discretion
(but with absolutely no obligation) make Loans to the Borrower, on behalf of the
Revolving Lenders, in amounts that exceed the Excess Availability immediately
prior to the making of such Loans (any such excess Loans are herein referred to
collectively as “Overadvances”), provided that no Overadvance shall result in a
Default due to the Borrower’s failure to comply with Section 2.01 for so long as
such Overadvance remains outstanding in accordance with the terms of this
paragraph, but solely with respect to the amount of such Overadvance. In
addition, Overadvances may be made even if the conditions precedent set forth in
Section 4.02 have not been satisfied. All Overadvances shall be ABR Borrowings.
The authority of the Administrative Agent to make Overadvances is limited to an
aggregate amount not to exceed $25,000,000 at any time, no Overadvance may
remain outstanding for more than 30 days and no Overadvance shall cause any
Lender’s Revolving Exposure to exceed its Revolving Commitment, provided that
the Required Lenders may at any time revoke the Administrative Agent’s
authorization to make Overadvances. Any such revocation must be in writing and
shall become effective prospectively upon the Administrative Agent’s receipt
thereof.
(e) Upon the making of an Overadvance by the Administrative Agent, each
Revolving Lender shall be deemed, without further action by any party hereto, to
have unconditionally and irrevocably purchased from the Administrative Agent
without recourse or warranty, an undivided interest and participation in such
Overadvance in proportion to its Applicable Percentage of the Revolving
Commitment. The Administrative Agent may, at any time, require the Revolving
Lenders to fund their participations in any Overadvance. From and after the
date, if any, on which any Revolving Lender is required to fund its
participation in any Overadvance purchased hereunder, the Administrative Agent
shall promptly distribute to such Lender, such Lender’s Applicable Percentage of
all payments of principal and interest and all proceeds of Collateral received
by the Administrative Agent in respect of such Overadvance.
SECTION 2.05. Letters of Credit. (a) General. As of the Restatement Effective
Date, each Existing Letter of Credit, automatically and without any action on
the part of any Person, has been deemed to be a Letter of Credit issued
hereunder for all purposes of this Agreement and the other Loan Documents.
Subject to the terms and conditions set forth herein, the Borrower may request
the issuance of Letters of Credit for its own account (or for the account of any
Subsidiary so long as the Borrower and such Subsidiary are co-applicants), in a
form reasonably acceptable to the Administrative Agent and the Issuing Bank, at
any time and from time to time during the Availability Period. In the event of
any inconsistency between the terms and conditions of this Agreement and the
terms and conditions of any form of letter of credit application or other
agreement submitted by the Borrower to, or entered into by the Borrower with,
the Issuing Bank relating to any Letter of Credit, the terms and conditions of
this Agreement shall control.
(b) Notice of Issuance, Amendment, Renewal, Extension; Certain Conditions. To
request the issuance of a Letter of Credit (or the amendment, renewal or
extension of an outstanding Letter of Credit), the Borrower shall hand deliver
or telecopy (or transmit by electronic communication, if arrangements for doing
so have been approved by the Issuing Bank) to the Issuing Bank (except that the
Issuing Bank in respect of Existing Letters of Credit shall not issue additional
Letters of Credit and, unless agreed by it, shall not be required to amend,
renew or extend an Existing Letter of Credit) and the Administrative Agent
(reasonably in advance of the requested date of issuance, amendment, renewal or
extension) a notice requesting the issuance of a Letter of Credit, or
identifying the Letter of Credit to be amended, renewed or extended, and
specifying the date of issuance, amendment, renewal or extension (which shall be
a Business Day), the date on which such Letter of Credit is to expire (which
shall comply with paragraph (c) of this Section), the amount of such Letter of
Credit, the name and address of the beneficiary thereof and such other
information as shall be necessary to prepare, amend, renew or extend such Letter
of Credit. If requested by the Issuing Bank, the Borrower also shall submit a
letter of credit application on the Issuing Bank’s standard form in connection
with any request for a Letter of Credit. A Letter of Credit shall be issued,
amended, renewed or extended only if (and upon issuance, amendment, renewal or
extension of each Letter of Credit the Borrower shall be deemed to represent and
warrant that), after giving effect to such issuance, amendment, renewal or
extension, (i) the LC Exposure shall not exceed $250,000,000 and (ii) the
aggregate Revolving Exposures shall not exceed the lesser of (x) the aggregate
Revolving Commitments and (y) the Borrowing Base, in each case at such time.

 

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(c) Expiration Date. Each Letter of Credit shall expire at or prior to the close
of business on the earlier of (i) the date that is one year after the date of
the issuance of such Letter of Credit (or, in the case of any renewal or
extension thereof, one year after such renewal or extension) and (ii) the date
that is five Business Days prior to the Original Maturity Date; provided,
however, that a Letter of Credit may, upon the request of the Borrower and with
the consent of the Issuing Bank, include a provision whereby such Letter of
Credit shall be renewed automatically for additional consecutive periods of one
year or less (but not beyond the date that is five Business Days prior to the
Original Maturity Date) unless the Issuing Bank, in its discretion, notifies the
beneficiary thereof at least 30 days prior to the then-applicable expiration
date that such Letter of Credit will not be renewed.
(d) Participations. By the issuance of a Letter of Credit (or an amendment to a
Letter of Credit increasing the amount thereof) and without any further action
on the part of the Issuing Bank or the Lenders, the Issuing Bank hereby grants
to each Revolving Lender, and each Revolving Lender hereby acquires from the
Issuing Bank, a participation in such Letter of Credit equal to such Lender’s
Applicable Percentage of the aggregate amount available to be drawn under such
Letter of Credit. In consideration and in furtherance of the foregoing, each
Revolving Lender hereby absolutely and unconditionally agrees to pay to the
Administrative Agent, for the account of the Issuing Bank, such Lender’s
Applicable Percentage of each LC Disbursement made by the Issuing Bank and not
reimbursed by the Borrower on the date due as provided in paragraph (e) of this
Section, or of any reimbursement payment required to be refunded to the Borrower
for any reason. Each Revolving Lender acknowledges and agrees that its
obligation to acquire participations pursuant to this paragraph in respect of
Letters of Credit is absolute and unconditional and shall not be affected by any
circumstance whatsoever, including any amendment, renewal or extension of any
Letter of Credit or the occurrence and continuance of a Default or reduction or
termination of the Commitments, and that each such payment shall be made without
any offset, abatement, withholding or reduction whatsoever.
(e) Reimbursement. If the Issuing Bank shall make any LC Disbursement in respect
of a Letter of Credit, the Borrower shall reimburse such LC Disbursement by
paying to the Administrative Agent an amount equal to such LC Disbursement not
later than 3:00 p.m., New York City time, on the date that such LC Disbursement
is made, if the Borrower shall have received notice of such LC Disbursement
prior to 10:00 a.m., New York City time, on such date, or, if such notice has
not been received by the Borrower prior to such time on such date, then not
later than (i) 3:00 p.m., New York City time, on the Business Day that the
Borrower receives such notice, if such notice is received prior to 10:00 a.m.,
New York City time, on the day of receipt, or (ii) 12:00 noon, New York City
time, on the Business Day immediately following the day that the Borrower
receives such notice, if such notice is not received prior to 10:00 a.m., New
York City time, on the day of receipt, provided that, if such LC Disbursement is
not less than $250,000, the Borrower may, subject to the conditions to borrowing
set forth herein (other than the minimum borrowing amount requirements set forth
in Section 2.02(c)), request in accordance with Section 2.03 or 2.04 that such
payment be financed with an ABR Revolving Borrowing or Swingline Loan in an
equivalent amount and, to the extent so financed, the Borrower’s obligation to
make such payment shall be discharged and replaced by the resulting ABR
Revolving Borrowing or Swingline Loan. If the Borrower fails to make such
payment when due, the Administrative Agent shall notify each Revolving Lender of
the applicable LC Disbursement, the payment then due from the Borrower in
respect thereof and such Lender’s Applicable Percentage thereof. Promptly
following receipt of such notice, each Revolving Lender shall pay to the
Administrative Agent its Applicable Percentage of the payment then due from the
Borrower, in the same manner as provided in Section 2.06 with respect to Loans
made by such Lender (and Section 2.06 shall apply, mutatis mutandis, to the
payment obligations of the Revolving Lenders), and the Administrative Agent
shall promptly pay to the Issuing Bank the amounts so received by it from the
Revolving Lenders. Promptly following receipt by the Administrative Agent of any
payment from the Borrower pursuant to this paragraph, the Administrative Agent
shall distribute such payment to the Issuing Bank or, to the extent that
Revolving Lenders have made payments pursuant to this paragraph to reimburse the
Issuing Bank, then to such Lenders and the Issuing Bank as their interests may
appear. Any payment made by a Revolving Lender pursuant to this paragraph to
reimburse the Issuing Bank for any LC Disbursement (other than the funding of
ABR Revolving Loans or a Swingline Loan as contemplated above) shall not
constitute a Loan and shall not relieve the Borrower of its obligation to
reimburse such LC Disbursement.

 

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

 

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(h) Interim Interest. If the Issuing Bank shall make any LC Disbursement, then,
unless the Borrower shall reimburse such LC Disbursement in full on the date
such LC Disbursement is made, the unpaid amount thereof shall bear interest, for
each day from and including the date such LC Disbursement is made to but
excluding the date that the Borrower reimburses such LC Disbursement, at the
rate per annum then applicable to ABR Revolving Loans, provided that, if the
Borrower fails to reimburse such LC Disbursement when due pursuant to paragraph
(e) of this Section, then Section 2.12(d) shall apply. Interest accrued pursuant
to this paragraph shall be for the account of the Issuing Bank, except that
interest accrued on and after the date of payment by any Revolving Lender
pursuant to paragraph (e) of this Section to reimburse the Issuing Bank shall be
for the account of such Lender to the extent of such payment.
(i) Replacement of the Issuing Bank. The Issuing Bank may be replaced at any
time by written agreement among the Borrower, the Administrative Agent, the
replaced Issuing Bank and the successor Issuing Bank. The Administrative Agent
shall notify the Lenders of any such replacement of the Issuing Bank. At the
time any such replacement shall become effective, the Borrower shall pay all
unpaid fees accrued for the account of the replaced Issuing Bank pursuant to
Section 2.11(d). From and after the effective date of any such replacement,
(i) the successor Issuing Bank shall have all the rights and obligations of the
Issuing Bank under this Agreement with respect to Letters of Credit to be issued
thereafter and (ii) references herein to the term “Issuing Bank” shall be deemed
to refer to such successor or to any previous Issuing Bank, or to such successor
and all previous Issuing Banks, as the context shall require. After the
replacement of an Issuing Bank hereunder, the replaced Issuing Bank shall remain
a party hereto and shall continue to have all the rights and obligations of an
Issuing Bank under this Agreement with respect to Letters of Credit issued by it
prior to such replacement, but shall not be required to issue additional Letters
of Credit.
(j) Cash Collateralization. If any Event of Default shall occur and be
continuing, on or after the Business Day on which the Borrower receives notice
from the Administrative Agent or the Required Lenders that the maturity of the
Loans has been accelerated and the Revolving Commitments have been terminated,
Revolving Lenders with LC Exposure representing greater than 50% of the LC
Exposure may demand the deposit of cash collateral pursuant to this paragraph,
and the Borrower shall deposit in an account with the Administrative Agent, in
the name of the Administrative Agent and for the benefit of the Lenders, an
amount in cash equal to the LC Exposure as of such date plus any accrued and
unpaid interest thereon, provided that the obligation to deposit such cash
collateral shall become effective immediately, and such deposit shall become
immediately due and payable, without demand or other notice of any kind, upon
the occurrence of any Event of Default with respect to the Borrower described in
paragraph (h) or (i) of Article VII. The Borrower also shall deposit cash
collateral pursuant to this paragraph as and to the extent required by
Section 2.10(b). Each such deposit shall be held by the Administrative Agent as
collateral for the payment and performance of the obligations of the Borrower
under this Agreement. The Administrative Agent shall have exclusive dominion and
control, including the exclusive right of withdrawal, over such account. Other
than any interest earned on the investment of such deposits, which investments
shall be made at the option and sole discretion of the Administrative Agent and
at the Borrower’s risk and expense, such deposits shall not bear interest.
Interest or profits, if any, on such investments shall accumulate in such
account. Moneys in such account shall be applied by the Administrative Agent to
reimburse the Issuing Bank for LC Disbursements for which it has not been
reimbursed and, to the extent not so applied, shall be held for the satisfaction
of the reimbursement obligations of the Borrower for the LC Exposure at such
time or, if the maturity of the Loans has been accelerated (but subject to the
consent of Revolving Lenders with LC Exposure representing greater than 50% of
the LC Exposure), be applied to satisfy other obligations of the Borrower under
this Agreement. If the Borrower is required to provide an amount of cash
collateral hereunder as a result of the occurrence of an Event of Default and
acceleration of the maturity of the Loans, as described above, such amount (to
the extent not applied as aforesaid) shall be returned to the Borrower within
three Business Days after all Events of Default have been cured or waived. If
the Borrower is required to provide an amount of cash collateral hereunder
pursuant to Section 2.10(b), such amount (to the extent not applied as
aforesaid) shall be returned to the Borrower as and to the extent that, after
giving effect to such return, the Borrower would remain in compliance with
Section 2.10(b) and no Default shall have occurred and be continuing.

 

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SECTION 2.06. Funding of Borrowings. (a) Each Lender shall make each Loan to be
made by it hereunder on the proposed date thereof by wire transfer of
immediately available funds by 12:00 noon, New York City time, to the account of
the Administrative Agent most recently designated by it for such purpose by
notice to the Lenders, provided that Swingline Loans shall be made as provided
in Section 2.04. The Administrative Agent will make such Loans available to the
Borrower by promptly, and in no event later than 3:00 p.m., New York City time,
crediting the amounts so received, in like funds, to an account of the Borrower
maintained with the Administrative Agent in New York City and designated by the
Borrower in the applicable Borrowing Request, provided that ABR Revolving Loans
made to finance the reimbursement of (i) an LC Disbursement as provided in
Section 2.05(e) shall be remitted by the Administrative Agent to the Issuing
Bank or, to the extent that the Revolving Lenders have made payments pursuant to
Section 2.05(e) to reimburse the Issuing Bank, then to such Lenders and the
Issuing Bank as their interests may appear or (ii) an Overadvance shall be
retained by the Administrative Agent or, to the extent that the Revolving
Lenders have made payments pursuant to Section 2.04(e) to reimburse the
Administrative Agent in respect of any such Overadvance, remitted by the
Administrative Agent to such Revolving Lenders as their interests may appear.
(b) Unless the Administrative Agent shall have received notice from a Lender
prior to the proposed date of any Borrowing that such Lender will not make
available to the Administrative Agent such Lender’s share of such Borrowing, the
Administrative Agent may assume that such Lender has made such share available
on such date in accordance with paragraph (a) of this Section and may, in
reliance upon such assumption and in its sole discretion, make available to the
Borrower a corresponding amount. In such event, if a Lender has not in fact made
its share of the applicable Borrowing available to the Administrative Agent,
then the applicable Lender and the Borrower severally agree to pay to the
Administrative Agent forthwith on demand such corresponding amount with interest
thereon, for each day from and including the date such amount is made available
to the Borrower to but excluding the date of payment to the Administrative
Agent, at (i) in the case of such Lender, the greater of the Federal Funds
Effective Rate and a rate determined by the Administrative Agent in accordance
with banking industry rules on interbank compensation or (ii) in the case of the
Borrower, the interest rate applicable to such Loan. If such Lender pays such
amount to the Administrative Agent, then such amount (less interest) shall
constitute such Lender’s Loan included in such Borrowing.
SECTION 2.07. Interest Elections. (a) Each Revolving Borrowing initially shall
be of the Type specified in the applicable Borrowing Request or designated by
Section 2.03 and, in the case of a Eurodollar Borrowing, shall have an initial
Interest Period as specified in such Borrowing Request or designated by
Section 2.03. Thereafter, the Borrower may elect to convert such Borrowing to a
different Type or to continue such Borrowing and, in the case of a Eurodollar
Borrowing, may elect Interest Periods therefor, all as provided in this Section.
The Borrower may elect different options with respect to different portions of
the affected Borrowing, in which case each such portion shall be allocated
ratably among the Lenders holding the Loans comprising such Borrowing, and the
Loans comprising each such portion shall be considered a separate Borrowing.
This Section shall not apply to Swingline Borrowings or Overadvances, which may
not be converted or continued.

 

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(b) To make an election pursuant to this Section, the Borrower shall notify the
Administrative Agent of such election by telephone by the time that a Borrowing
Request would be required under Section 2.03 if the Borrower were requesting a
Revolving Borrowing of the Type resulting from such election to be made on the
effective date of such election. Each such telephonic Interest Election Request
shall be irrevocable and shall be confirmed promptly by hand delivery or
telecopy or by Adobe pdf file to the Administrative Agent of a written Interest
Election Request substantially in the form of Exhibit D signed by the Borrower.
(c) Each telephonic and written Interest Election Request shall specify the
following information in compliance with Section 2.02:
(i) the Borrowing to which such Interest Election Request applies and, if
different options are being elected with respect to different portions thereof,
the portions thereof to be allocated to each resulting Borrowing (in which case
the information to be specified pursuant to clauses (iii) and (iv) below shall
be specified for each resulting Borrowing);
(ii) the effective date of the election made pursuant to such Interest Election
Request, which shall be a Business Day;
(iii) whether the resulting Borrowing is to be an ABR Borrowing or a Eurodollar
Borrowing; and
(iv) if the resulting Borrowing is a Eurodollar Borrowing, the Interest Period
to be applicable thereto after giving effect to such election, which shall be a
period contemplated by the definition of the term “Interest Period”.
If any such Interest Election Request requests a Eurodollar Borrowing but does
not specify an Interest Period, then the Borrower shall be deemed to have
selected an Interest Period of one month’s duration.
(d) Promptly following receipt of an Interest Election Request, the
Administrative Agent shall advise each Lender of the details thereof and of such
Lender’s portion of each resulting Borrowing.
(e) If the Borrower fails to deliver a timely Interest Election Request with
respect to a Eurodollar Borrowing prior to the end of the Interest Period
applicable thereto, then, unless such Borrowing is repaid as provided herein, at
the end of such Interest Period such Borrowing shall be converted to an ABR
Borrowing. Notwithstanding any contrary provision hereof, if an Event of Default
has occurred and is continuing and the Administrative Agent, at the request of
the Required Lenders, so notifies the Borrower, then, so long as an Event of
Default is continuing (i) no outstanding Borrowing may be converted to or
continued as a Eurodollar Borrowing and (ii) unless repaid, each Eurodollar
Borrowing shall be converted to an ABR Borrowing at the end of the Interest
Period applicable thereto.
SECTION 2.08. Termination and Reduction of Revolving Commitments. (a) Unless
previously terminated, the Revolving Commitments shall terminate on the Maturity
Date.
(b) The Borrower may at any time terminate, or from time to time reduce, in
either case, without premium or penalty (other than, with respect to Eurodollar
Borrowings, payments that may become due under Section 2.15), the Revolving
Commitments, provided that (i) each reduction of the Revolving Commitments shall
be in an amount that is an integral multiple of $1,000,000 and not less than
$5,000,000 and (ii) the Borrower shall not terminate or reduce the Revolving
Commitments if, after giving effect to any concurrent prepayment of the
Revolving Loans in accordance with Section 2.10, the aggregate Revolving
Exposure (excluding, in the case of any termination of the Revolving
Commitments, the portion of the Revolving Exposure attributable to outstanding
Letters of Credit if and to the extent that the Borrower has made arrangements
satisfactory to the Administrative Agent and the Issuing Bank with respect to
such Letters of Credit) would exceed the aggregate Revolving Commitments.

 

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(c) The Borrower shall notify the Administrative Agent of any election to
terminate or reduce the Revolving Commitments under paragraph (b) of this
Section at least three Business Days prior to the effective date of such
termination or reduction, specifying such election and the effective date
thereof. Promptly following receipt of any such notice, the Administrative Agent
shall advise the Lenders of the contents thereof. Each notice delivered by the
Borrower pursuant to this Section shall be irrevocable, provided that a notice
of termination or reduction of Revolving Commitments delivered by the Borrower
may state that such notice is conditioned upon the effectiveness of other credit
facilities or the receipt of the proceeds from the issuance of other
Indebtedness or any other event, in which case such notice may be revoked by the
Borrower (by notice to the Administrative Agent on or prior to the specified
effective date) if such condition is not satisfied. Any termination or reduction
of the Revolving Commitments shall be permanent. Each reduction of the Revolving
Commitments shall be made ratably among the Lenders in accordance with their
respective Revolving Commitments.
SECTION 2.09. Repayment of Loans; Evidence of Debt. (a) The Borrower hereby
unconditionally promises to pay (i) to the Administrative Agent for the account
of each Lender the then unpaid principal amount of each Revolving Loan of such
Lender on the Maturity Date, (ii) to the Swingline Lender the then unpaid
principal amount of each Swingline Loan on the Maturity Date, provided that on
each date that a Revolving Borrowing is made, the Borrower shall repay all
Swingline Loans that were outstanding on the date such Borrowing was requested,
and (iii) to the Administrative Agent the then unpaid principal amount of each
Overadvance on the earliest of (x) the Maturity Date, (y) the day that is
30 days after the making of such Overadvance and (z) demand by the
Administrative Agent.
(b) On each Business Day during any Cash Dominion Period, the Administrative
Agent shall apply all immediately available funds credited to the Collection
Account, first to prepay any Overadvances that may be outstanding, pro rata,
second to prepay any Swingline Loans and to reimburse any LC Disbursements that
may be outstanding, pro rata, and third to prepay any Revolving Loans that may
be outstanding and, if no such Loans are outstanding, to cash collateralize
outstanding Letters of Credit on terms reasonably acceptable to the
Administrative Agent and the Issuing Bank, it being understood that any
prepayments of Revolving Loans shall be applied in accordance with the
penultimate sentence of Section 2.17(b).
(c) Each Lender shall maintain in accordance with its usual practice an account
or accounts evidencing the indebtedness of the Borrower to such Lender resulting
from each Loan made by such Lender, including the amounts of principal and
interest payable and paid to such Lender from time to time hereunder.
(d) The Administrative Agent shall maintain accounts in which it shall record
(i) the amount of each Loan made hereunder, the Type thereof and the Interest
Period applicable thereto, (ii) the amount of any principal or interest due and
payable or to become due and payable from the Borrower to each Lender hereunder
and (iii) the amount of any sum received by the Administrative Agent hereunder
for the account of the Lenders and each Lender’s share thereof.
(e) The entries made in the accounts maintained pursuant to paragraph (c) or
(d) of this Section shall be prima facie evidence of the existence and amounts
of the obligations recorded therein, provided that the failure of any Lender or
the Administrative Agent to maintain such accounts or any error therein shall
not in any manner affect the obligation of the Borrower to repay the Loans and
pay interest thereon in accordance with the terms of this Agreement.

 

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(f) Any Lender may request that Revolving Loans made by it be evidenced by a
promissory note. In such event, the Borrower shall prepare, execute and deliver
to such Lender a promissory note, substantially in the form of Exhibit H,
payable to the order of such Lender (or, if requested by such Lender, to such
Lender and its registered assigns). Thereafter, the Loans evidenced by such
promissory note and interest thereon shall at all times (including after
assignment pursuant to Section 9.04) be represented by one or more promissory
notes in such form payable to the order of the payee named therein (or, if such
promissory note is a registered note, to such payee and its registered assigns).
SECTION 2.10. Prepayment of Loans. (a) The Borrower shall have the right at any
time and from time to time to prepay without premium or penalty (other than,
with respect to Eurodollar Borrowings, payments that may become due under
Section 2.15) any Borrowing in whole or in part, subject to the requirements of
this Section.
(b) Except for Overadvances permitted under Section 2.04, in the event and on
such occasion that the aggregate Revolving Exposure exceeds the lesser of
(x) the aggregate Revolving Commitments and (y) the Borrowing Base, in each case
as of the applicable date of determination, the Borrower shall prepay Revolving
Borrowings and/or Swingline Borrowings (or, if no such Borrowings are
outstanding, deposit cash collateral in an account with the Administrative Agent
to be retained pursuant to Section 2.05(j) for so long as such condition exists)
in an aggregate amount equal to such excess.
(c) Prior to any optional prepayment or mandatory prepayment of Borrowings
hereunder, the Borrower shall select the Borrowing or Borrowings to be prepaid
and shall specify such selection in the notice of such prepayment pursuant to
paragraph (d) of this Section.
(d) The Borrower shall notify the Administrative Agent (and, in the case of
prepayment of a Swingline Loan, the Swingline Lender) by telephone (confirmed by
telecopy or by Adobe pdf file) of any prepayment hereunder (i) in the case of
prepayment of a Eurodollar Borrowing, not later than 11:00 a.m., New York City
time, three Business Days before the date of prepayment, (ii) in the case of
prepayment of an ABR Borrowing, not later than 11:00 a.m., New York City time,
one Business Day before the date of prepayment or (iii) in the case of
prepayment of a Swingline Loan, not later than 12:00 noon, New York City time,
on the date of prepayment. Each such notice shall be irrevocable and shall
specify the prepayment date, the principal amount of each Borrowing or portion
thereof to be prepaid and, in the case of a mandatory prepayment, a reasonably
detailed calculation of the amount of such prepayment, provided that a notice of
optional prepayment may state that such notice is conditioned upon the
effectiveness of other credit facilities or the receipt of the proceeds from the
issuance of other Indebtedness or any other event, in which case such notice of
prepayment may be revoked by the Borrower (by notice to the Administrative Agent
on or prior to the specified date) if such condition is not satisfied. Promptly
following receipt of any such notice (other than a notice relating solely to
Swingline Loans) the Administrative Agent shall advise the Lenders of the
contents thereof. Each partial prepayment of any Revolving Borrowing shall be in
an amount that would be permitted in the case of an advance of a Revolving
Borrowing of the same Type as provided in Section 2.02, except as necessary to
apply fully the required amount of a mandatory prepayment. Each prepayment of a
Revolving Borrowing shall be applied ratably to the Revolving Loans included in
the prepaid Borrowing. Prepayments shall be accompanied by accrued interest to
the extent required by Section 2.12.
SECTION 2.11. Fees. (a) The Borrower agrees to pay to the Administrative Agent
for the account of each Lender a facility fee, which shall accrue at the rate of
0.75% per annum on the Revolving Commitment of such Lender during the period
from and including the Restatement Effective Date to but excluding the date on
which the Revolving Commitments terminate. Accrued facility fees shall be
payable in arrears on the third Business Day following the last day of each
March, June, September and December of each year and on the date on which the
Revolving Commitments terminate, commencing on the first such date to occur
after the Restatement Effective Date. All facility fees shall be computed on the
basis of a year of 360 days and shall be payable for the actual number of days
elapsed (including the first day but excluding the last day).

 

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(b) The Borrower agrees to pay (i) to the Administrative Agent for the account
of each Revolving Lender a participation fee with respect to its participations
in Letters of Credit, which shall accrue at the same Applicable Rate used to
determine the interest rate applicable to Eurodollar Revolving Loans on the
average daily amount of such Lender’s LC Exposure (excluding any portion thereof
attributable to unreimbursed LC Disbursements) during the period from and
including the Restatement Effective Date to but excluding the later of the date
on which such Lender’s Revolving Commitment terminates and the date on which
such Lender ceases to have any LC Exposure, and (ii) to the Issuing Bank a
fronting fee, which shall accrue at a rate equal to 0.25% per annum on the
average daily amount of the LC Exposure (excluding any portion thereof
attributable to unreimbursed LC Disbursements) during the period from and
including the Restatement Effective Date to but excluding the later of the date
of termination of the Revolving Commitments and the date on which there ceases
to be any LC Exposure, as well as the Issuing Bank’s standard fees with respect
to the issuance, amendment, renewal or extension of any Letter of Credit or
processing of drawings thereunder. Participation fees and fronting fees accrued
through and including the last day of March, June, September and December of
each year shall be payable on the third Business Day following such last day,
commencing on the first such date to occur after the Restatement Effective Date,
provided that all such fees shall be payable on the date on which the Revolving
Commitments terminate and any such fees accruing after the date on which the
Revolving Commitments terminate shall be payable on demand. Any other fees
payable to the Issuing Bank pursuant to this paragraph shall be payable within
10 days after demand. All participation fees and fronting fees shall be computed
on the basis of a year of 360 days and shall be payable for the actual number of
days elapsed (including the first day but excluding the last day).
(c) The Borrower agrees to pay to the Administrative Agent, for its own account,
fees payable in the amounts and at the times separately agreed upon in writing
between the Borrower and the Administrative Agent.
(d) All fees payable hereunder shall be paid on the dates due, in immediately
available funds, to the Administrative Agent (or to the Issuing Bank, in the
case of fees payable to it) for distribution, in the case of commitment fees and
participation fees, to the Lenders entitled thereto. Fees paid shall not be
refundable under any circumstances.
SECTION 2.12. Interest. (a) The Loans comprising each ABR Borrowing (including
each Swingline Loan) shall bear interest at the Alternate Base Rate plus the
Applicable Rate.
(b) The Loans comprising each Eurodollar Borrowing shall bear interest at the
Adjusted LIBO Rate for the Interest Period in effect for such Borrowing plus the
Applicable Rate.
(c) Each Overadvance shall bear interest at the Alternate Base Rate plus the
Applicable Rate plus 2.00%.
(d) Notwithstanding the foregoing, if any principal of or interest on any Loan
or any fee or other amount payable by the Borrower hereunder is not paid when
due, whether at stated maturity, upon acceleration or otherwise, such overdue
amount shall bear interest, after as well as before judgment, at a rate per
annum equal to (i) in the case of overdue principal of any Loan, 2.00% plus the
rate otherwise applicable to such Loan as provided in the preceding paragraphs
of this Section or (ii) in the case of any other amount, 2.00% plus the rate
applicable to ABR Revolving Loans as provided in paragraph (a) of this Section.

 

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(e) Accrued interest on each Loan shall be payable in arrears on each Interest
Payment Date for such Loan and upon termination of the Revolving Commitments,
provided that (i) interest accrued pursuant to paragraph (c) or (d) of this
Section shall be payable on demand, (ii) in the event of any repayment or
prepayment of any Loan (other than a prepayment of an ABR Revolving Loan prior
to the end of the Availability Period), accrued interest on the principal amount
repaid or prepaid shall be payable on the date of such repayment or prepayment
and (iii) in the event of any conversion of any Eurodollar Loan prior to the end
of the current Interest Period therefor, accrued interest on such Loan shall be
payable on the effective date of such conversion.
(f) All interest hereunder shall be computed on the basis of a year of 360 days,
except that interest computed by reference to the Alternate Base Rate at times
when the Alternate Base Rate is based on the Prime Rate shall be computed on the
basis of a year of 365 days (or 366 days in a leap year), and in each case shall
be payable for the actual number of days elapsed (including the first day but
excluding the last day). The applicable Alternate Base Rate or Adjusted LIBO
Rate shall be determined by the Administrative Agent, and such determination
shall be conclusive absent manifest error.
SECTION 2.13. Alternate Rate of Interest. If prior to the commencement of any
Interest Period for a Eurodollar Borrowing:
(a) the Administrative Agent determines (which determination shall be conclusive
absent manifest error) that adequate and reasonable means do not exist for
ascertaining the Adjusted LIBO Rate for such Interest Period; or
(b) the Administrative Agent is advised by the Required Lenders that the
Adjusted LIBO Rate for such Interest Period will not adequately and fairly
reflect the cost to such Lenders of making or maintaining their Loans included
in such Borrowing for such Interest Period;
then the Administrative Agent shall give notice thereof to the Borrower and the
Lenders by telephone or telecopy or by Adobe pdf file as promptly as practicable
thereafter and, until the Administrative Agent notifies the Borrower and the
Lenders that the circumstances giving rise to such notice no longer exist,
(i) any Interest Election Request that requests the conversion of any Borrowing
to, or continuation of any Borrowing as, a Eurodollar Borrowing shall be
ineffective and (ii) if any Borrowing Request requests a Eurodollar Borrowing,
such Borrowing shall be made as an ABR Borrowing, provided that following the
first day that such condition shall cease to exist, such Borrowings may be made
as or converted to Eurodollar Borrowings at the request of and in accordance
with the elections of the Borrower.
SECTION 2.14. Increased Costs. (a) 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 by, any Lender or the Issuing Bank
(except any such reserve requirement reflected in the Adjusted LIBO Rate); or
(ii) impose on any Lender or the Issuing Bank or the London interbank market any
other condition, cost or expense affecting this Agreement or Eurodollar Loans
made by such Lender or any Letter of Credit or participation therein;

 

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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 Loan (or of maintaining its
obligation to make any such Loan) or to increase the cost to such Lender or the
Issuing Bank of participating in, issuing or maintaining any Letter of Credit or
to reduce the amount of any sum received or receivable by such Lender or the
Issuing Bank hereunder (whether of principal, interest or otherwise), then, upon
the request of such Lender or the Issuing Bank, as applicable, the Borrower will
pay to such Lender or the Issuing Bank, as the case may be, such additional
amount or amounts as will compensate such Lender or the Issuing Bank, as the
case may be, for such additional costs incurred or reduction suffered.
(b) If any Lender or the Issuing Bank determines that any Change in Law
regarding capital requirements has or would have the effect of reducing the rate
of return on such Lender’s or the Issuing Bank’s capital or on the capital of
such Lender’s or the Issuing Bank’s holding company, if any, as a consequence of
this Agreement or the Loans made by, or participations in Letters of Credit held
by, such Lender, or the Letters of Credit issued by the Issuing Bank, to a level
below that which such Lender or the Issuing Bank or such Lender’s or the Issuing
Bank’s holding company could have achieved but for such Change in Law (taking
into consideration such Lender’s or the Issuing Bank’s policies and the policies
of such Lender’s or the Issuing Bank’s holding company with respect to capital
adequacy), then from time to time the Borrower will pay to such Lender or the
Issuing Bank, as the case may be, such additional amount or amounts as will
compensate such Lender or the Issuing Bank or such Lender’s or the Issuing
Bank’s holding company for any such reduction suffered.
(c) A certificate of a Lender or the Issuing Bank setting forth in reasonable
detail calculations of the amount or amounts necessary to compensate such Lender
or the Issuing Bank or its holding company, as the case may be, as specified in
paragraph (a) or (b) of this Section shall be delivered to the Borrower and
shall be conclusive absent manifest error. The Borrower shall pay such Lender or
the Issuing Bank, as the case may be, the amount shown as due on any such
certificate within 10 days after receipt thereof.
(d) Failure or delay on the part of any Lender or the Issuing Bank to demand
compensation pursuant to this Section shall not constitute a waiver of such
Lender’s or the Issuing Bank’s right to demand such compensation, provided that
the Borrower shall not be required to compensate a Lender or the Issuing Bank
pursuant to this Section for any increased costs or reductions incurred more
than 270 days prior to the date that such Lender or the Issuing Bank, as the
case may be, notifies the Borrower of the Change in Law giving rise to such
increased costs or reductions and of such Lender’s or the Issuing Bank’s
intention to claim compensation therefor; provided further that, if the Change
in Law giving rise to such increased costs or reductions is retroactive, then
the 270-day period referred to above shall be extended to include the period of
retroactive effect thereof.
SECTION 2.15. Break Funding Payments. In the event of (a) the payment of any
principal of any Eurodollar Loan other than on the last day of an Interest
Period applicable thereto (including as a result of an Event of Default),
(b) the conversion of any Eurodollar Loan other than on the last day of the
Interest Period applicable thereto, (c) the failure to borrow, convert, continue
or prepay any Eurodollar Loan (or to convert any ABR Loan into a Eurodollar
Loan) on the date specified in any notice delivered pursuant hereto (regardless
of whether such notice may be revoked under Section 2.10(d) and is revoked in
accordance therewith) or (d) the assignment of any Eurodollar Loan other than on
the last day of the Interest Period applicable thereto as a result of a request
by the Borrower to replace a Lender pursuant to Section 2.18(b) or Section
9.02(c), then, in any such event, the Borrower shall compensate each Lender for
the loss, cost and reasonable expense attributable to such event. In the case of
a Eurodollar Loan, such loss, cost or expense to any Lender shall be deemed to
include an amount determined by such Lender to be the excess, if any, of (i) the
amount of interest that would have accrued on the principal amount of such Loan
had such event not occurred, at the LIBO Rate (without consideration of the
Applicable Rate) that would have been applicable to such Loan, for the period
from the date of such event to the last day of the then current Interest Period
therefor (or, in the case of a failure to borrow, convert or continue, for the
period that would have been the Interest Period for such Loan), over (ii) the
amount of interest that would accrue on such principal amount for such period at
the interest rate that such Lender would bid were it to bid, at the commencement
of such period, for dollar deposits of a comparable amount and period from other
banks in the eurodollar market (without consideration of the Applicable Rate). A
certificate of any Lender setting forth any amount or amounts that such Lender
is entitled to receive pursuant to this Section shall be delivered to the
Borrower and shall be conclusive absent manifest error. The Borrower shall pay
such Lender the amount shown as due on any such certificate within 10 days after
the Borrower’s receipt thereof.

 

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SECTION 2.16. Taxes. (a) Any and all payments by or on account of any obligation
of the Borrower under any Loan Document shall be made free and clear of and
without deduction for any Indemnified Taxes or Other Taxes, provided that if the
Borrower shall be required to deduct any Indemnified Taxes or Other Taxes from
such payments, then (i) the sum payable shall be increased as necessary so that
after making all required deductions (including deductions applicable to
additional sums payable under this Section) the Administrative Agent, Lender or
Issuing Bank (as the case may be) receives an amount equal to the sum it would
have received had no such deductions been made, (ii) the Borrower shall make
such deductions and (iii) the Borrower shall pay the full amount deducted to the
relevant Governmental Authority in accordance with applicable law.
(b) Without limiting the provisions of paragraph (a) above, the Borrower shall
timely pay any Other Taxes to the relevant Governmental Authority in accordance
with applicable law.
(c) The Borrower shall indemnify the Administrative Agent, each Lender and the
Issuing Bank, within 10 days after written demand therefor, for the full amount
of any Indemnified Taxes or Other Taxes paid by the Administrative Agent, such
Lender or the Issuing Bank, as the case may be, on or with respect to any
payment by or on account of any obligation of the Borrower under any Loan
Document (including Indemnified Taxes or Other Taxes imposed or asserted on or
attributable to amounts payable under this Section) 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 as to the amount
of such payment or liability delivered to the Borrower by a Lender or the
Issuing Bank, or by the Administrative Agent on its own behalf or on behalf of a
Lender or the Issuing Bank, shall be conclusive absent manifest error.
(d) Each Lender shall indemnify the Administrative Agent within 10 days after
demand therefor, for the full amount of any Excluded Taxes attributable to such
Lender that are payable by the Administrative Agent, and reasonable expenses
arising therefrom or with respect thereto, whether or not such Excluded Taxes
were correctly or legally imposed or asserted by the relevant Governmental
Authority. A certificate as to the amount of such payment or liability delivered
to any Lender by the Administrative Agent shall be conclusive absent manifest
error.
(e) As soon as practicable after any payment of Indemnified Taxes or Other Taxes
by the Borrower to a Governmental Authority pursuant to Section 2.16(a), the
Borrower shall deliver to the Administrative Agent the original or a certified
copy of a receipt issued by such Governmental Authority evidencing such payment,
a copy of the return reporting such payment or other evidence of such payment
reasonably satisfactory to the Administrative Agent.
(f) (i) Any Foreign Lender that is entitled to an exemption from or reduction of
withholding tax under the law of the jurisdiction in which the Borrower is
located, or any treaty to which such jurisdiction is a party, with respect to
payments under this Agreement shall deliver to the Borrower (with a copy to the
Administrative Agent), at the time or times prescribed by applicable law or
reasonably requested by the Borrower or the Administrative Agent, such properly
completed and executed documentation prescribed by applicable law as will permit
such payments to be made without withholding or at a reduced rate. In addition,
any Lender, if requested by the Borrower or the Administrative Agent, shall
deliver such other documentation prescribed by applicable law or reasonably
requested by the Borrower or the Administrative Agent as will enable the
Borrower or the Administrative Agent to determine whether or not such Lender is
subject to backup withholding or information reporting requirements.

 

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(ii) Without limiting the generality of the foregoing, in the event that the
Borrower is resident for tax purposes in the U.S., any Foreign Lender shall
deliver to the Borrower and the Administrative Agent (in such number of copies
as shall be requested by the recipient) on or prior to the date on which such
Foreign Lender becomes a Lender under this Agreement (and from time to time
thereafter upon the request of the Borrower or the Administrative Agent, but
only if such Foreign Lender is legally entitled to do so), whichever of the
following is applicable:
(i) duly completed copies of Internal Revenue Service Form W-8BEN claiming
eligibility for benefits of an income tax treaty to which the U.S. is a party,
(ii) duly completed copies of Internal Revenue Service Form W-8ECI,
(iii) in the case of a Foreign Lender claiming the benefits of the exemption for
portfolio interest under section 881(c) of the Code, (x) a certificate to the
effect that such Foreign Lender is not (A) a “bank” within the meaning of
section 881(c)(3)(A) of the Code, (B) a “10 percent shareholder” of the Borrower
within the meaning of section 881(c)(3)(B) of the Code, or (C) a “controlled
foreign corporation” described in section 881(c)(3)(C) of the Code and (y) duly
completed copies of Internal Revenue Service Form W-8BEN, or
(iv) any other form prescribed by applicable law as a basis for claiming
exemption from or a reduction in U.S. Federal withholding Tax duly completed
together with such supplementary documentation as may be prescribed by
applicable law to permit the Borrower to determine the withholding or deduction
required to be made.
Each Lender agrees that if any form or certification previously delivered by
such Lender pursuant to this paragraph (f) expires or becomes obsolete or
inaccurate in any material respect, such Lender shall update such form or
certification or promptly notify the Borrower and the Administrative Agent in
writing of such Lender’s legal inability to do so.
(iii) If a payment made to a Lender under this Agreement or any Loan Document
would be subject to U.S. Federal withholding Tax imposed by FATCA if such Lender
were to fail to comply with the applicable reporting requirements of FATCA
(including those contained in Section 1471(b) or 1472(b) of the Code, as
applicable), such Lender shall deliver to the Withholding Agent, at the time or
times prescribed by law and at such time or times reasonably requested by the
Withholding Agent, such documentation prescribed by applicable law (including as
prescribed by Section 1471(b)(3)(C)(i) of the Code) and such additional
documentation reasonably requested by the Withholding Agent as may be necessary
for the Withholding Agent to comply with its obligations under FATCA, to
determine that such Lender has complied with such Lender’s obligations under
FATCA or to determine the amount to deduct and withhold from such payment.
(g) If the Administrative Agent, a Lender or the Issuing Bank 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 the Borrower or with respect to which the
Borrower has paid additional amounts pursuant to this Section 2.16, it shall pay
to the Borrower an amount equal to such refund. This paragraph shall not be
construed to require the Administrative Agent, any Lender or the Issuing Bank to
make available its Tax returns (or any other information relating to its taxes
that it deems confidential) to the Borrower or any other Person.

 

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SECTION 2.17. Payments Generally; Allocation of Proceeds; Sharing of Setoffs.
(a) The Borrower shall make each payment required to be made by it under any
Loan Document (whether of principal, interest, fees or reimbursement of LC
Disbursements, or of amounts payable under Section 2.14, 2.15, 2.16 or 9.03, or
otherwise) at or prior to the time expressly required hereunder or under such
other Loan Document for such payment (or, if no such time is expressly required,
prior to 12:00 noon, New York City time), on the date when due, in immediately
available funds, without setoff or counterclaim. Any amounts received after such
time on any date may, in the discretion of the Administrative Agent, be deemed
to have been received on the next succeeding Business Day for purposes of
calculating interest thereon. All such payments shall be made to the
Administrative Agent at its offices at 270 Park Avenue, New York, New York or at
such other address that the Administrative Agent shall advise the Borrower in
writing, except payments to be made directly to the Issuing Bank or Swingline
Lender as expressly provided herein and except that payments pursuant to
Sections 2.14, 2.15, 2.16 and 9.03 shall be made directly to the Persons
entitled thereto and payments pursuant to other Loan Documents shall be made to
the Persons specified therein. The Administrative Agent shall distribute any
such payments received by it for the account of any other Person to the
appropriate recipient promptly following receipt thereof. If any payment under
any Loan Document shall be due on a day that is not a Business Day, the date for
payment shall be extended to the next succeeding Business Day and, in the case
of any payment accruing interest, interest thereon shall be payable for the
period of such extension. All payments under each Loan Document shall be made in
dollars.
(b) If at any time insufficient funds are received by and available to the
Administrative Agent to pay fully all amounts of principal, unreimbursed LC
Disbursements, interest and fees then due hereunder, such funds shall be applied
(i) first, towards payment of interest and fees then due hereunder, ratably
among the parties entitled thereto in accordance with the amounts of interest
and fees then due to such parties, and (ii) second, towards payment of principal
and unreimbursed LC Disbursements then due hereunder, ratably among the parties
entitled thereto in accordance with the amounts of principal and unreimbursed LC
Disbursements then due to such parties. Notwithstanding the immediately
preceding sentence, any proceeds of Collateral received by the Administrative
Agent (i) not constituting either (A) a specific payment of principal, interest,
fees, reimbursement of LC Disbursements or other sum payable under the Loan
Documents (which shall be applied as specified by the Borrower in accordance
with the terms hereof), (B) a mandatory prepayment (which shall be applied in
accordance with Section 2.10) or (C) amounts to be applied from the Collection
Account during any Cash Dominion Period (which shall be applied in accordance
with Section 2.09(b)) or (ii) after an Event of Default has occurred and is
continuing and the Administrative Agent so elects or the Required Lenders so
direct, shall be applied (in each case ratably as interests may appear) first,
to pay any fees, indemnities, or expense reimbursements then due to the
Administrative Agent from the Loan Parties (other than in connection with
Banking Services Obligations or Swap Obligations), second, to pay any fees or
expense reimbursements then due to the Lenders from the Loan Parties (other than
in connection with Banking Services Obligations or Swap Obligations), third, to
pay interest due in respect of the Overadvances, fourth, to pay the principal of
the Overadvances, fifth, to pay interest then due and payable on the Loans
(other than the Overadvances), sixth, to prepay principal on the Loans (other
than the Overadvances) and unreimbursed LC Disbursements, seventh, to pay an
amount to the Administrative Agent equal to 105% of the aggregate undrawn face
amount of all outstanding Letters of Credit to be held as cash collateral for
such Obligations, eighth, to the payment of any other Secured Obligation (other
than Banking Services Obligations and Swap Obligations) due to the
Administrative Agent or any Lender by the Loan Parties, and ninth, to pay any
amounts owing with respect to Banking Services Obligations and Swap Obligations
that are Secured Obligations. Notwithstanding anything to the contrary contained
in this Agreement, unless so directed by the Borrower, or unless an Event of
Default has occurred and is continuing, neither the Administrative Agent nor any
Lender shall apply any payment that it receives to a Eurodollar Loan, except
(x) on the expiration date of the Interest Period applicable to any such
Eurodollar Loan or (y) in the event, and only to the extent, that there are no
outstanding ABR Loans and, in any such event, the Borrower shall pay the break
funding payment required in accordance with Section 2.15. The Administrative
Agent and the Lenders shall have the continuing and exclusive right to apply and
reverse and reapply any and all such proceeds and payments to any portion of the
Secured Obligations in accordance with the terms of this Agreement.

 

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(c) At the election of the Administrative Agent, all payments of principal,
interest, fees, premiums, reimbursable expenses (including, without limitation,
all reimbursement for fees and expenses pursuant to Section 9.03) and other sums
payable under the Loan Documents that are not paid when due in accordance with
the Loan Documents (after giving effect to any applicable grace period(s)) may
be paid from the proceeds of Borrowings made hereunder whether made following a
request by the Borrower pursuant to Section 2.03 or a deemed request as provided
in this Section or may be deducted from any deposit account of the Borrower
maintained with the Administrative Agent. The Borrower hereby irrevocably
authorizes (i) the Administrative Agent to make a Borrowing in the name of the
Borrower for the purpose of paying each payment of principal, interest and fees
payable by the Borrower as it becomes due hereunder or any other amount due
under the Loan Documents and agrees that all such amounts charged shall
constitute Loans (including Swingline Loans and Overadvances, as the case may
be) and that all such Borrowings shall be deemed to have been requested pursuant
to Sections 2.03 or 2.04, as applicable, and (ii) the Administrative Agent to
charge any deposit account of the Borrower maintained with the Administrative
Agent for each payment of principal, interest and fees payable by such Borrower
as it becomes due hereunder or any other amount due under the Loan Documents.
(d) 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
its Revolving Loans or participations in LC Disbursements, Swingline Loans or
Overadvances resulting in such Lender receiving payment of a greater proportion
of the aggregate amount of its Revolving Loans and participations in LC
Disbursements, Swingline Loans and Overadvances and accrued interest thereon
than the proportion received by any other Lender, then the Lender receiving such
greater proportion shall purchase (for cash at face value) participations in the
Revolving Loans and participations in LC Disbursements, Swingline Loans and
Overadvances of other Lenders to the extent necessary so that the benefit of all
such payments shall be shared by the Lenders ratably in accordance with the
aggregate amount of principal of and accrued interest on their respective
Revolving Loans and participations in LC Disbursements, Swingline Loans and
Overadvances, provided that (i) if any such participations are purchased and all
or any portion of the payment giving rise thereto is recovered, such
participations shall be rescinded and the purchase price restored to the extent
of such recovery, without interest, and (ii) the provisions of this paragraph
shall not be construed to apply to any payment made by the Borrower pursuant to
and in accordance with the express terms of this Agreement or any payment
obtained by a Lender as consideration for the assignment of or sale of a
participation in any of its Loans or participations in LC Disbursements to any
assignee or participant, other than to the Borrower or any Subsidiary or other
Affiliate thereof (as to which the provisions of this paragraph shall apply).
The Borrower consents to the foregoing and agrees, to the extent it may
effectively do so under applicable law, that any Lender acquiring a
participation pursuant to the foregoing arrangements may exercise against the
Borrower rights of setoff and counterclaim with respect to such participation as
fully as if such Lender were a direct creditor of the Borrower in the amount of
such participation.

 

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(e) Unless the Administrative Agent shall have received notice from the Borrower
prior to the date on which any payment is due to the Administrative Agent for
the account of the Lenders or the Issuing Bank hereunder that the Borrower will
not make such payment, the Administrative Agent may assume that the Borrower has
made such payment on such date in accordance herewith and may, in reliance upon
such assumption and in its sole discretion, distribute to the Lenders or the
Issuing Bank, as the case may be, the amount due. In such event, if the Borrower
has not in fact made such payment, then each of the Lenders or the Issuing Bank,
as the case may be, severally agrees to repay to the Administrative Agent
forthwith on demand the amount so distributed to such Lender or the Issuing Bank
with interest thereon, for each day from and including the date such amount is
distributed to it to but excluding the date of payment to the Administrative
Agent, at the greater of the Federal Funds Effective Rate and a rate determined
by the Administrative Agent in accordance with banking industry rules on
interbank compensation.
(f) If any Lender shall fail to make any payment required to be made by it
pursuant to Section 2.04(c) or (e), 2.05 (d) or (e), 2.06(a) or (b), 2.17(e) or
9.03(c), then the Administrative Agent may, in its discretion (notwithstanding
any contrary provision hereof), apply any amounts thereafter received by the
Administrative Agent for the account of such Lender to satisfy such Lender’s
obligations under such Sections until all such unsatisfied obligations are fully
paid.
SECTION 2.18. Mitigation Obligations; Replacement of Lenders. (a) If any Lender
requests compensation under Section 2.14, or if the Borrower is required to pay
any additional amount to any Lender or any Governmental Authority for the
account of any Lender pursuant to Section 2.16, then such Lender shall use
reasonable efforts to designate a different lending office for funding or
booking its Loans hereunder or to assign its rights and obligations hereunder to
another of its offices, branches or affiliates, if, in the judgment of such
Lender, such designation or assignment (i) would eliminate or reduce amounts
payable pursuant to Section 2.14 or 2.16, as the case may be, in the future and
(ii) would not subject such Lender to any unreimbursed cost or expense and would
not be inconsistent with its internal policies or otherwise be disadvantageous
to such Lender. The Borrower hereby agrees to pay all reasonable costs and
expenses incurred by any Lender in connection with any such designation or
assignment.
(b) If any Lender requests compensation under Section 2.14, or if the Borrower
is required to pay any additional amount to any Lender or any Governmental
Authority for the account of any Lender pursuant to Section 2.16, or if any
Lender becomes a Defaulting Lender, then the Borrower may, at its sole expense
and effort, upon notice to such Lender and the Administrative Agent, require
such Lender to assign and delegate, without recourse (in accordance with and
subject to the restrictions contained in Section 9.04), all its interests,
rights and obligations under this Agreement to an assignee acceptable to the
Borrower that shall assume such obligations (which assignee may be another
Lender, if a Lender accepts such assignment), provided that (i) the Borrower
shall have received the prior written consent of the Administrative Agent (and,
if a Revolving Commitment is being assigned, the Issuing Bank and the Swingline
Lender), which consent shall not unreasonably be withheld, (ii) such Lender
shall have received payment of an amount equal to the outstanding principal of
its Loans and funded participations in LC Disbursements, Swingline Loans and
Overadvances, accrued interest thereon, accrued fees and all other amounts
payable to it hereunder from the assignee (to the extent of such outstanding
principal and accrued interest and fees) or the Borrower (in the case of all
other amounts), (iii) the Borrower or such assignee shall have paid to the
Administrative Agent the processing and recordation fee specified in
Section 9.04(b) and (iv) in the case of any such assignment resulting from a
claim for compensation under Section 2.14 or payments required to be made
pursuant to Section 2.16, such assignment will result in a reduction in such
compensation or payments. A Lender shall not be required to make any such
assignment and delegation if, prior thereto, as a result of a waiver by such
Lender or otherwise (including as a result of any action taken by such Lender
under paragraph (a) above), the circumstances entitling the Borrower to require
such assignment and delegation cease to apply.

 

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SECTION 2.19. Revolving Commitment Increases. (a) The Borrower may from time to
time (and more than one time), by written notice to the Administrative Agent
(which shall promptly deliver a copy to each of the Lenders), request that the
aggregate Revolving Commitments be increased by an amount not less than
$15,000,000 for any such increase, except to the extent necessary to utilize the
remaining unused amount of increase permitted under this Section 2.19(a),
provided that after giving effect to any such increase the sum of the total
Revolving Commitments shall not exceed $600,000,000. Such notice shall set forth
the amount of the requested increase in the Revolving Commitments and the date
on which such increase is requested to become effective (which shall be not less
than ten Business Days or more than 60 days after the date of such notice), and
shall offer each Lender (provided that such Lender shall be reasonably
satisfactory to the Administrative Agent) the opportunity to increase its
Revolving Commitment by such Lender’s Applicable Percentage of the proposed
increased amount. Each Lender shall, by notice to the Borrower and the
Administrative Agent given not more than ten days after the date of the
Borrower’s notice, either agree to increase its applicable Revolving Commitment
by all or a portion of the offered amount or decline to increase its applicable
Commitment (and any Lender that does not deliver such a notice within such
period of ten days shall be deemed to have declined to increase its Commitment).
In the event that, on the tenth day after the Borrower shall have delivered a
notice pursuant to the first sentence of this paragraph, the Lenders shall have
declined to increase their Revolving Commitments or have agreed pursuant to the
preceding sentence to increase their Revolving Commitments by an aggregate
amount less than the increase in the total Revolving Commitments requested by
the Borrower, the Borrower may arrange for one or more banks or other financial
institutions (any such bank or other financial institution, together with any
existing Lender that agrees to increase its applicable Revolving Commitment
pursuant to the immediately preceding sentence, being called an “Augmenting
Lender”) to provide Revolving Commitments or increase their existing Revolving
Commitments in an aggregate amount equal to the unsubscribed amount, provided
that each Augmenting Lender (other than any such Augmenting Lender that is a
Lender immediately prior to giving effect to the applicable Revolving Commitment
Increase, provided that (x) at any time after the Restatement Effective Date and
prior to giving effect to such Revolving Commitment Increase, the Borrower shall
not have requested any reduction to the Revolving Commitments, and the Revolving
Commitments shall not have otherwise been reduced, in accordance with
Section 2.08 and (y) immediately after giving effect to such Revolving
Commitment Increase, the aggregate amount of Revolving Commitments held by any
Lender shall not exceed 20% of the total Revolving Commitments at such time)
shall be subject to the approval of the Administrative Agent (which approval
shall not be unreasonably withheld) and shall not be subject to the approval of
any other Lenders, and the Borrower and each Augmenting Lender shall execute all
such documentation as the Administrative Agent shall reasonably specify to
evidence the Revolving Commitment of such Augmenting Lender and/or its status as
a Lender hereunder. Any increase in the aggregate Revolving Commitments may be
made in an amount that is less than the increase requested by the Borrower if
the Borrower is unable to arrange for, or chooses not to arrange for, Augmenting
Lenders.
(b) Each of the parties hereto hereby agrees that, upon the effectiveness of any
increase in the aggregate Revolving Commitments pursuant to this Section 2.19
(the “Revolving Commitment Increase”), this Agreement may be amended (such
amendment, a “Commitment Increase Amendment”) without the consent of any Lenders
to the extent (but only to the extent) necessary to reflect the existence and
terms of the Revolving Commitment Increase evidenced thereby as provided for in
Section 9.02(b). Upon each Revolving Commitment Increase pursuant to this
Section, (i) each Lender immediately prior to such increase will automatically
and without further act be deemed to have assigned to each Augmenting Lender
providing a portion of such Revolving Commitment Increase, and each such
Augmenting Lender will automatically and without further act be deemed to have
assumed, a portion of such Lender’s participations hereunder in outstanding
Letters of Credit, Swingline Loans and Overadvances such that, after giving
effect to such Revolving Commitment Increase and each such deemed assignment and
assumption of participations, the percentage of the aggregate outstanding
(A) participations hereunder in Letters of Credit, (B) participations hereunder
in Swingline

 

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Loans and (C) participations hereunder in Overadvances held by each Lender
(including each such Augmenting Lender) will equal such Lender’s Applicable
Percentage and (ii) if, on the date of such Revolving Commitment Increase, there
are any Revolving Loans outstanding, such Revolving Loans shall on or prior to
the effectiveness of such Revolving Commitment Increase be prepaid from the
proceeds of additional Revolving Loans made hereunder (reflecting such Revolving
Commitment Increase), which prepayment shall be accompanied by accrued interest
on the Revolving Loans being prepaid and any costs incurred by any Lender in
accordance with Section 2.15. The Administrative Agent and the Lenders hereby
agree that the minimum borrowing, pro rata borrowing and pro rata payment
requirements contained elsewhere in this Agreement shall not apply to the
transactions effected pursuant to the immediately preceding sentence.
(c) Increases and new Revolving Commitments created pursuant to this
Section 2.19 shall become effective on the date specified in the notice
delivered by the Borrower pursuant to the first sentence of paragraph (a) above
or on such other date as agreed upon by the Borrower, the Administrative Agent
and the applicable Augmenting Lenders.
(d) Notwithstanding the foregoing, no increase in the Revolving Commitments (or
in any Commitment of any Lender) or addition of an Augmenting Lender shall
become effective under this Section unless on the date of such increase, the
conditions set forth in paragraphs (a) and (b) of Section 4.02 shall be
satisfied as of such date (as though the effectiveness of such increase were a
Borrowing) and the Administrative Agent shall have received a certificate to
that effect dated such date and executed by a Financial Officer.
SECTION 2.20. Defaulting Lenders. Notwithstanding any provision of this
Agreement to the contrary, if any Revolving Lender becomes a Defaulting Lender,
then the following provisions shall apply for so long as such Revolving Lender
is a Defaulting Lender:
(a) fees shall cease to accrue on the unfunded portion of the Revolving
Commitment of such Defaulting Lender pursuant to Section 2.11(a);
(b) the Revolving Commitment and Revolving Exposure of such Defaulting Lender
shall not be included in determining whether the Required Lenders have taken or
may take any action hereunder (including any consent to any amendment, waiver or
other modification pursuant to Section 9.02), provided that this clause
(b) shall not apply to the vote of a Defaulting Lender in the case of an
amendment, waiver or other modification requiring the consent of such Lender or
each Lender affected thereby;
(c) if any Swingline Exposure or LC Exposure exists, or any Overadvance is
outstanding, at the time such Revolving Lender becomes a Defaulting Lender,
then:
(i) all or any part of the Swingline Exposure, LC Exposure or participation
interest in Overadvances of such Defaulting Lender shall be reallocated among
the non-Defaulting Lenders in accordance with their respective Applicable
Percentages but only to the extent that and so long as (A) the sum of all
non-Defaulting Lenders’ Revolving Exposure plus such Defaulting Lender’s
Swingline Exposure, LC Exposure and participation interest in Overadvances does
not exceed the total of all non-Defaulting Lenders’ Revolving Commitments,
(B) the sum of any non-Defaulting Lender’s Revolving Exposure plus such
non-Defaulting Lender’s Applicable Percentage of the Defaulting Lender’s
Swingline Exposure, LC Exposure and participation interest in Overadvances does
not exceed such non-Defaulting Lender’s Revolving Commitment and (C) the
conditions set forth in Sections 4.02(a) and (b) are satisfied as of the date of
such reallocation (assuming, solely for purpose of this clause (C), that such
reallocation is a “Borrowing” as such term is used in Section 4.02);

 

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(ii) if the reallocation described in clause (i) above cannot, or can only
partially, be effected, the Borrower shall within one Business Day following
notice by the Administrative Agent (x) first, prepay such Swingline Exposure
(or, if agreed by the Swingline Lender, cash collateralize the Swingline
Exposure of the Defaulting Lender on terms satisfactory to the Swingline
Lender), (y) second, prepay such Overadvance (or, if agreed by the
Administrative Agent, cash collateralize that portion of such Overadvance
attributable to such Defaulting Lender’s participation interest therein on terms
satisfactory to the Administrative Agent, and (z) third, cash collateralize for
the benefit of the Issuing Bank only the Borrower’s obligations corresponding to
such Defaulting Lender’s LC Exposure (after giving effect to any partial
reallocation pursuant to clause (i) above) in accordance with the procedures set
forth in Section 2.05(j) for so long as such LC Exposure is outstanding;
(iii) if the Borrower cash collateralizes any portion of such Defaulting
Lender’s LC Exposure (after giving effect to any partial reallocation pursuant
to clause (i) above) pursuant to clause (ii) above, the Borrower shall not be
required to pay any fees to such Defaulting Lender pursuant to Section 2.11(b)
with respect to such Defaulting Lender’s LC Exposure during the period such
Defaulting Lender’s LC Exposure is cash collateralized;
(iv) if the LC Exposure of the non-Defaulting Lenders is reallocated pursuant to
clause (i) above, then the fees payable to the Revolving Lenders pursuant to
Section 2.11(b) shall be adjusted in accordance with such non-Defaulting
Lenders’ respective Applicable Percentages; and
(v) if all or any portion of such Defaulting Lender’s LC Exposure is neither
reallocated nor cash collateralized pursuant to clause (i) or (ii) above, then,
without prejudice to any rights or remedies of the Issuing Bank or any other
Revolving Lender hereunder, all participation fees payable under Section 2.11(b)
with respect to such Defaulting Lender’s LC Exposure shall be payable to the
Issuing Bank until and to the extent that such LC Exposure is so reallocated
and/or cash collateralized; and
(d) so long as such Revolving Lender is a Defaulting Lender, the Administrative
Agent shall not be required to fund any Overadvance, the Swingline Lender shall
not be required to fund any Swingline Loan and the Issuing Bank shall not be
required to issue, amend or increase any Letter of Credit, in each case unless
it is satisfied that the related exposure and the Defaulting Lender’s then
outstanding LC Exposure, Swingline Exposure and participation interest in
Overadvances will be 100% covered by the Revolving Commitments of the
non-Defaulting Lenders and/or cash collateral will be provided by the Borrower
in accordance with Section 2.20(c), and participation interests in any
newly-made Swingline Loan or Overadvance or any newly-issued, amended or
increased Letter of Credit shall be allocated among the non-Defaulting Lenders
in a manner consistent with Section 2.20(c)(i) (and such Defaulting Lender shall
not participate therein).
If (i) a Bankruptcy Event with respect to a Parent of any Revolving Lender shall
occur following the date hereof and for so long as such event shall continue or
(ii) the Administrative Agent, the Swingline Lender or the Issuing Bank has a
good faith belief that any Revolving Lender has defaulted in fulfilling its
obligations under one or more other agreements in which such Revolving Lender
commits to extend credit, then the Administrative Agent shall not be required to
fund any Overadvance, the Swingline Lender shall not be required to fund any
Swingline Loan and the Issuing Bank shall not be required to issue, amend or
increase any Letter of Credit, unless (A) the Administrative Agent, the
Swingline Lender or the Issuing Bank, as the case may be, shall have entered
into arrangements with the Borrower or such Lender, satisfactory to the
Administrative Agent, the Swingline Lender or the Issuing Bank, as the case may
be, to address any risk to it in respect of such Revolving Lender hereunder or
(B) in the case of an event specified in clause (i) of this paragraph, the
requirements set forth in Section 2.20(d) are satisfied in respect of such
Revolving Lender, in which case such Revolving Lender shall be deemed to be a
Defaulting Lender for purposes of this Section 2.20.

 

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In the event that the Administrative Agent, the Borrower, the Swingline Lender
and the Issuing Bank each agrees that a Defaulting Lender has adequately
remedied all matters that caused such Lender to be a Defaulting Lender, then the
Swingline Exposure, the LC Exposure and the participations in Overadvances of
the Revolving Lenders shall be readjusted to reflect the inclusion of such
Revolving Lender’s Commitment and on such date such Lender shall purchase at par
such of the Loans of the other Revolving Lenders (other than Swingline Loans) as
the Administrative Agent shall determine may be necessary in order for such
Lender to hold such Loans in accordance with its Applicable Percentage.
ARTICLE III
Representations and Warranties
The Borrower represents and warrants to the Lenders that:
SECTION 3.01. Organization; Powers. The Borrower and each of the Material
Subsidiaries is duly organized, validly existing and in good standing under the
laws of the jurisdiction of its organization, has all requisite power and
authority to carry on its business as now conducted and as proposed to be
conducted, to execute, deliver and perform its obligations under each Loan
Document to which it is a party and to effect the Transactions and, except where
the failure to do so, individually or in the aggregate, could not reasonably be
expected to result in a Material Adverse Effect, is qualified to do business in,
and is in good standing in, every jurisdiction where such qualification is
required.
SECTION 3.02. Authorization; Enforceability. The Transactions to be entered into
by each Loan Party have been duly authorized by all necessary corporate or other
action and, if required, action by the holders of such Loan Party’s Equity
Interests. This Agreement has been duly executed and delivered by the Borrower
and constitutes, and each other Loan Document to which any Loan Party is to be a
party, when executed and delivered by such Loan Party, will constitute, a legal,
valid and binding obligation of the Borrower or such Loan Party (as the case may
be), enforceable in accordance with its terms, subject to applicable bankruptcy,
insolvency, reorganization, moratorium or other laws affecting creditors’ rights
generally and subject to general principles of equity, regardless of whether
considered in a proceeding in equity or at law.
SECTION 3.03. Governmental Approvals; No Conflicts. The Transactions (a) do not
require any consent or approval of, registration or filing with, or any other
action by, any Governmental Authority, except (i) filings with any Governmental
Authority necessary to perfect Liens created under the Loan Documents and
(ii) such as have been obtained or made and are in full force and effect, except
such consents, approvals, registrations or filings, the failure of which to have
been obtained, received or made will not materially impair the effectiveness of
the Transactions or materially adversely affect the operations of the Borrower
and the Subsidiaries, taken as a whole, (b) will not violate any material
Requirement of Law applicable to the Borrower or any Material Subsidiary,
(c) will not violate or result in a material default under any material
indenture, agreement or other instrument binding upon the Borrower or any
Material Subsidiary or their respective assets, or give rise to a right
thereunder to require any material payment to be made by the Borrower or any
Material Subsidiary or give rise to a right of, or result in, termination,
cancelation or acceleration of any material obligation thereunder, and (d) will
not result in the creation or imposition of any Lien (other than a Lien
permitted under Section 6.02) on any asset of the Borrower or any Material
Subsidiary.

 

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SECTION 3.04. Financial Condition; No Material Adverse Change. (a) The Borrower
has heretofore furnished to the Lenders its consolidated balance sheet and
consolidated statements of income, stockholders’ equity and cash flows (i) as of
and for the fiscal year ended December 31, 2009, reported on by Deloitte &
Touche LLP, independent public accountants, and (ii) as of and for the fiscal
quarters and the portions of the fiscal year ended March 31, 2010, June 30,
2010, and September 30, 2010 (and comparable period for the prior fiscal year).
Such financial statements present fairly, in all material respects, the
financial position and results of operations and cash flows of the Borrower and
the Subsidiaries as of such dates and for such periods in accordance with GAAP
consistently applied, subject to year end audit adjustments and the absence of
footnotes in the case of the statements referred to in clause (ii) above.
(b) On and as of the Restatement Effective Date, no event, change or condition
has occurred that has had, or could reasonably be expected to have, a material
adverse effect on the business, operations, properties, assets, condition
(financial or otherwise), liabilities (including contingent liabilities) or
prospects of the Borrower and the Subsidiaries, taken as a whole, since
December 31, 2009, provided that it is understood that the Lenders are satisfied
with (and no such material adverse effect shall be deemed to have occurred with
respect to) the results of operations and financial conditions set forth in the
financial statements for the period ended September 30, 2010, as set forth in
the Borrower’s Form 10-Q filed with the SEC on October 29, 2010, and the
projections for the fiscal quarter of the Borrower ending December 31, 2010, and
the fiscal year of the Borrower ending December 31, 2011, as set forth in the
“Discussions with Lenders” dated November 2010, delivered by the Borrower to the
Administrative Agent and the Lenders.
SECTION 3.05. Properties. (a) The Borrower and each of the Material Subsidiaries
has good title to, or valid leasehold interests in, all its real and personal
property, except for any defects that, individually or in the aggregate, could
not reasonably be expected to result in a Material Adverse Effect.
(b) The Borrower and each of the Material Subsidiaries owns, or is licensed to
use, all trademarks, tradenames, copyrights, patents and other intellectual
property material to its business, and the use thereof by the Borrower and the
Material Subsidiaries does not infringe upon the rights of any other Person,
except for any such infringements that, individually or in the aggregate, could
not reasonably be expected to result in a Material Adverse Effect.
SECTION 3.06. Litigation and Environmental Matters. (a) There are no actions,
suits or proceedings by or before any arbitrator or Governmental Authority
pending against or, to the knowledge of the Borrower or any Material Subsidiary,
threatened against or affecting the Borrower or any Material Subsidiary (i) as
to which there is a reasonable likelihood of an adverse determination and that,
if adversely determined, could reasonably be expected, individually or in the
aggregate, to result in a Material Adverse Effect (other than the Disclosed
Matters) or (ii) that involve any of the Loan Documents or the Transactions.
(b) Except for the Disclosed Matters and except with respect to any other
matters that, individually or in the aggregate, could not reasonably be expected
to result in a Material Adverse Effect, neither the Borrower nor any Material
Subsidiary (i) has failed to comply with any Environmental Law or to obtain,
maintain or comply with any permit, license or other approval required under any
Environmental Law, (ii) has become subject to any Environmental Liability, (iii)
has received notice of any claim with respect to any Environmental Liability or
(iv) knows of any basis for any Environmental Liability.

 

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SECTION 3.07. Compliance with Laws and Agreements. The Borrower and each of the
Material Subsidiaries is in compliance with (a) all Requirements of Law
applicable to it or its property and (b) all indentures, agreements and other
instruments binding upon it or its property, except, in each of the cases of
(a) and (b) above, where the failure to do so, individually or in the aggregate,
could not reasonably be expected to result in a Material Adverse Effect.
SECTION 3.08. Investment Company Status. Neither the Borrower nor any Subsidiary
is an “investment company” as defined in, or subject to regulation under, the
Investment Company Act of 1940.
SECTION 3.09. Taxes. The Borrower and each of the Subsidiaries (a) has timely
filed or caused to be filed all Tax returns and reports required to have been
filed, except to the extent that failure to do so could not reasonably be
expected to result in a Material Adverse Effect, and (b) has paid or caused to
be paid all Taxes required to have been paid by it, except any Taxes that are
being contested in good faith by appropriate proceedings, provided that the
Borrower or such Subsidiary, as the case may be, has set aside on its books
adequate reserves therefor and the failure to pay such Taxes would not
reasonably be expected to result in a Material Adverse Effect.
SECTION 3.10. ERISA. No ERISA Event has occurred or is reasonably expected to
occur that, when taken together with all other such ERISA Events for which
liability is reasonably expected to occur, could reasonably be expected to
result in a Material Adverse Effect.
SECTION 3.11. Disclosure. None of (i) the Borrower’s Quarterly Reports on Form
10-Q for the periods ended March 31, 2010, June 30, 2010, and September 30,
2010, its Annual Report on Form 10-K for the fiscal year ended December 31, 2009
(collectively, the “SEC Filings”), and the other filings of the Borrower made
with the SEC in 2010 (but prior to the Restatement Effective Date) nor (ii) any
of the other reports, financial statements, certificates or other information
furnished by or on behalf of the Borrower to the Administrative Agent or any
Lender pursuant to any Loan Document or delivered thereunder (as modified or
supplemented by other information furnished by or on behalf of the Borrower to
the Administrative Agent in connection herewith), as of the date such
disclosures are delivered, contains any material misstatement of fact or omits
to state any material fact necessary to make the statements therein, in the
light of the circumstances under which they were made, not misleading, provided
that, with respect to projected financial information, the Borrower represents
only that such information was prepared in good faith based upon assumptions
believed by it to be reasonable at the time delivered (unless otherwise updated
subsequent thereto, in which case such information was prepared in good faith
based upon assumptions believed by it to be reasonable at the time updated).
SECTION 3.12. Insurance. On the Restatement Effective Date, the Borrower
provided to the Administrative Agent a description of all insurance maintained
by or on behalf of the Loan Parties and the Material Subsidiaries as of the
Restatement Effective Date. As of the Restatement Effective Date, all premiums
due in respect of such insurance have been paid.
SECTION 3.13. Security Interest in Collateral. The provisions of this Agreement
and the other Loan Documents create legal and valid Liens on all the Collateral
in favor of the Administrative Agent, for the benefit of the Secured Parties,
and, for so long as UCC financing statements or Deposit Account Control
Agreements, as the case may be, with respect to such Collateral have not been
terminated by the Administrative Agent (or otherwise amended by the
Administrative Agent in a manner that adversely affects the Lien in favor of the
Secured Parties thereby perfected), such Liens constitute perfected and
continuing Liens on the Collateral, securing the Secured Obligations,
enforceable against the applicable Loan Party and all third parties, and having
priority over all other Liens on the Collateral except in the case of Liens
permitted under clauses (ii) through (iv), (vi) and (xi) of Section 6.02, to the
extent any such Liens would have priority over the Liens in favor of the
Administrative Agent pursuant to any applicable law.

 

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SECTION 3.14. Labor Matters. As of the Restatement Effective Date, there are no
material strikes, lockouts or slowdowns or any other material labor disputes
against the Borrower or any Material Subsidiary pending or, to the knowledge of
the Borrower or any Material Subsidiary, threatened or planned.
ARTICLE IV
Conditions
SECTION 4.01. [Intentionally Omitted]
SECTION 4.02. Each Credit Event. The obligation of each Lender to make a Loan on
the occasion of any Borrowing (other than a deemed Borrowing under
Section 2.17(c) and an Overadvance made under Section 2.04), and of the Issuing
Bank to issue, amend, renew or extend any Letter of Credit, is subject to the
receipt by the Administrative Agent of the request therefor in accordance
herewith and to the satisfaction of the following conditions:
(a) Other than the representation and warranty set forth in Section 3.04(b), the
representations and warranties of the Loan Parties set forth in the Loan
Documents that are qualified by materiality shall be true and correct and the
representations and warranties that are not so qualified shall be true and
correct in all material respects on and as of the date of such Borrowing or the
date of issuance, amendment, renewal or extension of such Letter of Credit, as
the case may be, except to the extent such representations and warranties
expressly relate to an earlier date (in which case such representations and
warranties shall be true and correct as of such earlier date).
(b) At the time of and immediately after giving effect to such Borrowing or the
issuance, amendment, renewal or extension of such Letter of Credit, as the case
may be, no Default shall have occurred and be continuing.
Each Borrowing (provided that a conversion or a continuation of a Borrowing
shall not constitute a “Borrowing” for purposes of this Section) and each
issuance, amendment, renewal or extension of a Letter of Credit shall be deemed
to constitute a representation and warranty by the Borrower on the date thereof
as to the matters specified in paragraphs (a) and (b) of this Section.
ARTICLE V
Affirmative Covenants
Until the Commitments have expired or been terminated and the principal of and
interest on each Loan and all fees, expenses and other amounts (other than
contingent amounts not yet due) payable under any Loan Document shall have been
paid in full and all Letters of Credit shall have expired or been terminated (or
cash collateralized in an amount equal to 105% of the aggregate undrawn amount
of all outstanding Letters of Credit) and all LC Disbursements shall have been
reimbursed, the Borrower covenants and agrees with the Lenders that:

 

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SECTION 5.01. Financial Statements; Borrowing Base and Other Information. The
Borrower will furnish to the Administrative Agent for prompt delivery to each
Lender:
(a) within 90 days after the end of each fiscal year of the Borrower, the
Borrower’s audited consolidated balance sheet and audited consolidated
statements of operations, stockholders’ equity and cash flows as of the end of
and for such year, and related notes thereto, setting forth in each case in
comparative form the figures for the previous fiscal year, all reported on by
Deloitte & Touche LLP or other independent public accountants of recognized
national standing (without a “going concern” or like qualification or exception
and without any qualification or exception as to the scope of such audit) to the
effect that such consolidated financial statements present fairly in all
material respects the financial condition and results of operations of the
Borrower and the Subsidiaries on a consolidated basis in accordance with GAAP
consistently applied;
(b) within 45 days after the end of each of the first three fiscal quarters of
each fiscal year of the Borrower, the Borrower’s unaudited consolidated balance
sheet and unaudited consolidated statements of operations, stockholders’ equity
and cash flows as of the end of and for such fiscal quarter and the then elapsed
portion of the fiscal year, setting forth in each case in comparative form the
figures for the corresponding period or periods of (or, in the case of the
balance sheet, as of the end of) the previous fiscal year, all certified by a
Financial Officer as presenting fairly in all material respects the financial
condition and results of operations of the Borrower and the Subsidiaries on a
consolidated basis in accordance with GAAP consistently applied, subject to
normal year-end audit adjustments and the absence of footnotes;
(c) concurrently with any delivery or deemed delivery of financial statements
under paragraph (a) or (b) above, a certificate of a Financial Officer
substantially in the form of Exhibit E (i) certifying as to whether a Default
has occurred and, if a Default has occurred, specifying the details thereof and
any action taken or proposed to be taken with respect thereto, (ii) setting
forth reasonably detailed calculations of the financial covenant (and the
components thereof) contained in Section 6.12 and (iii) stating whether any
change in GAAP or in the application thereof has occurred since the later of the
date of the Borrower’s most recent audited financial statements referred to in
Section 3.04 and the date of the prior certificate delivered pursuant to this
paragraph (c) indicating such a change and, if any such change has occurred,
specifying the effect of such change on the financial statements accompanying
such certificate;
(d) not later than 90 days subsequent to the commencement of each fiscal year of
the Borrower, a detailed consolidated budget for such fiscal year (including a
projected consolidated balance sheet and consolidated statements of projected
operations, comprehensive income and cash flows as of the end of and for such
fiscal year and setting forth the assumptions used for purposes of preparing
such budget) and, promptly when available, any significant revisions of such
budget;
(e) as soon as available but in any event within 13 Business Days of the end of
each calendar month, as of the last day of the preceding calendar month, a
Borrowing Base Certificate and supporting information in connection therewith,
together with any additional reports with respect to the Borrowing Base as the
Administrative Agent may reasonably request. Notwithstanding any provision of
this Agreement to the contrary, subsequent to each date on which Excess
Availability is less than the Threshold Amount (or if a Borrowing or the
issuance of a Letter of Credit would cause Excess Availability to fall below the
Threshold Amount), the Borrower shall not be permitted to make any additional
Borrowings or such Borrowing or request the issuance of additional Letters of
Credit or such Letter of Credit, as the case may be (provided that a conversion
or a continuation of a Borrowing shall not constitute a “Borrowing” for purposes
of this sentence), unless the Borrower shall have delivered to the
Administrative Agent a Borrowing Base Certificate as of a date no earlier than
three Business Days prior to the date of such Borrowing or the issuance of such
Letter of Credit; provided, however, the Borrower shall not be required to
deliver a Borrowing Base Certificate pursuant to the second sentence of this
paragraph if Excess Availability shall have exceeded the Threshold Amount for a
period of five consecutive Business Days prior to the date of such Borrowing or
the issuance of such Letter of Credit;

 

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(f) concurrently with the delivery of each Borrowing Base Certificate, and at
such other times as may be reasonably requested by the Administrative Agent, all
Borrowing Base Supplemental Documentation for the month (or such shorter period
as contemplated by clause (e) of this Section) then ended;
(g) promptly as reasonably practicable after the request therefor, such
additional information concerning the Accounts and Inventory of the Collateral
Parties or adjustments thereto as may be reasonably requested by the
Administrative Agent from time to time;
(h) promptly after the same become publicly available, copies of all periodic
and other reports, proxy statements and other materials filed by the Borrower or
any Subsidiary with the SEC or with any national securities exchange, or
distributed by the Borrower to the holders of its Equity Interests generally, as
the case may be;
(i) promptly upon obtaining knowledge of any such event, circumstance or change,
a written notice of any event, circumstance or change that has occurred since
the delivery of the most recent Borrowing Base Certificate in accordance with
the terms of this Agreement that would materially reduce the aggregate amount of
the Eligible Accounts or the Eligible Inventory or result in a material portion
of the Eligible Accounts ceasing to be Eligible Accounts or a material portion
of the Eligible Inventory ceasing to be Eligible Inventory; and
(j) promptly following any request therefor, such other information regarding
the operations, business affairs and financial condition of the Borrower or any
Subsidiary, or compliance with the terms of any Loan Document, as the
Administrative Agent (on behalf of any Lender) may reasonably request.
Information required to be delivered pursuant to Sections 5.01(a), (b) and
(h) shall be deemed to have been delivered on the date on which the Borrower
provides notice to the Administrative Agent that such information has been
posted on the SEC website on the Internet at www.sec.gov, or through a link on
the Borrower’s website at www.usg.com, or at another website identified in such
notice and accessible by the Lenders without charge, provided that such notice
may be included in a certificate delivered pursuant to Section 5.01(c).
SECTION 5.02. Notices of Material Events. The Borrower will furnish to the
Administrative Agent (for prompt distribution to each Lender through the
Administrative Agent) written notice promptly, but in any event within five
Business Days of, when any of the Chief Executive Officer, the President or the
General Counsel of the Borrower or any Financial Officer obtains actual
knowledge of the following:
(a) the occurrence of any Default;

 

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(b) the filing or commencement of any action, suit or proceeding by or before
any arbitrator or Governmental Authority against or, to the knowledge of a
Financial Officer or another executive officer of the Borrower or any
Subsidiary, affecting the Borrower or any Affiliate thereof that has a
reasonable likelihood of being adversely determined, and, if adversely
determined, could reasonably be expected to result in a Material Adverse Effect;
(c) any Lien (other than Liens permitted by clauses (i) through (iv), (vi) or
(xi) of Section 6.02) or claim made or asserted against any of the Collateral;
(d) the occurrence of any ERISA Event or any fact or circumstance that gives
rise to a reasonable expectation that any ERISA Event will occur that, in either
case, alone or together with any other ERISA Events that have occurred or are
reasonably expected to occur, could reasonably be expected to result in a
Material Adverse Effect;
(e) any change in the Borrower’s corporate credit rating by S&P or Moody’s, or
any notice from either such agency indicating its intent to effect such a change
or to place the credit facilities on a “CreditWatch” or “WatchList” or any
similar list, in each case with negative implications, or its cessation of, or
its intent to cease, issuing a corporate credit rating for the Borrower; and
(f) any other development (including notice of any Environmental Liability) that
results in, or could reasonably be expected to result in, a Material Adverse
Effect.
Each notice delivered under this Section shall be accompanied by a written
statement of a Financial Officer or other executive officer of the Borrower
setting forth the details of the event or development requiring such notice and
any action taken or proposed to be taken with respect thereto.
SECTION 5.03. Existence; Conduct of Business. The Borrower will, and will cause
each Material Subsidiary to, do or cause to be done all things necessary to
obtain, preserve, renew and keep in full force and effect its legal existence
and, except where the failure to do so could not reasonably be expected to have
a Material Adverse Effect, the rights, licenses, permits, privileges,
franchises, patents, copyrights, trademarks and trade names material to the
conduct of its business, provided that the foregoing shall not prohibit any
merger, consolidation, liquidation or dissolution permitted under Section 6.03.
SECTION 5.04. Payment of Taxes. The Borrower will, and will cause each
Subsidiary to, pay its liabilities for Taxes, the amounts of which are material
to the Borrower and its Subsidiaries taken as a whole, before such liabilities
shall become delinquent or in default, except where (a) the validity or amount
thereof is being contested in good faith by appropriate proceedings, (b) the
Borrower or such Subsidiary has set aside on its books adequate reserves with
respect thereto in accordance with GAAP, (c) such contest effectively suspends
collection of the contested obligation and the enforcement of any Lien securing
such obligation and (d) the failure to make payment pending such contest could
not reasonably be expected to result in a Material Adverse Effect.
SECTION 5.05. Maintenance of Properties. The Borrower will, and will cause each
Subsidiary to, keep and maintain all property used in the conduct of its
business in good working order and condition, ordinary wear and tear excepted,
except for properties, the failure of which to maintain, could not reasonably be
expected to result in a Material Adverse Effect.
SECTION 5.06. Insurance. (a) The Borrower will, and will cause each Material
Subsidiary to, maintain, with financially sound and reputable insurance
companies, (i) insurance in such amounts (with no greater risk retention) and
against such risks as is (A) customarily maintained by companies of established
repute engaged in the same or similar businesses operating in the same or
similar locations and (B) considered adequate by the Borrower and (ii) all other
insurance as may be required by law, provided that self-insurance through any
captive insurance Subsidiary or through deductibles or copayments shall not be
deemed a violation of this covenant to the extent that companies engaged in
similar businesses similarly self-insure. The Borrower will furnish to the
Lenders, upon the reasonable request of the Administrative Agent, information in
reasonable detail as to the insurance so maintained.

 

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(b) All insurance policies required under paragraph (a) of this Section 5.06, to
the extent such insurance policies insure any portion of the Collateral, shall
name the Administrative Agent (for the benefit of the Secured Parties) as an
additional insured or as loss payee, as applicable, and shall contain loss
payable clauses or mortgagee clauses, through endorsements in form and substance
reasonably satisfactory to the Administrative Agent, that provide that (i) all
proceeds thereunder with respect to any Collateral shall be payable to the
Administrative Agent and (ii) such policy and loss payable or mortgagee clauses
may be canceled, amended or terminated only upon at least 30 days’ prior written
notice given to the Administrative Agent.
(c) If the Borrower or any Material Subsidiary shall fail to obtain any
insurance as required by paragraph (a) of this Section 5.06, the Administrative
Agent may obtain such insurance at the Borrower’s expense. By purchasing such
insurance, the Administrative Agent shall not be deemed to have waived any
Default arising from the Borrower’s or such Material Subsidiary’s failure to
maintain such insurance.
SECTION 5.07. Books and Records; Inspection Rights; Field Examinations;
Inventory Appraisals. (a) The Borrower will, and will cause each Subsidiary to,
keep proper books of record and account in which entries that are full, true and
correct in all material respects are made of all material dealings and
transactions in relation to its business and activities. The Borrower will, and
will cause each Loan Party to, permit any representatives designated by the
Administrative Agent (who may be accompanied by a representative of any Lender
at such Lender’s expense), upon reasonable prior notice and during normal
workings hours, periodically (but no more frequently than annually, except if an
Event of Default shall be continuing), to visit and inspect its properties, to
examine and make extracts from its books and records, and to discuss its
affairs, finances and condition with its officers and independent accountants.
(b) The Administrative Agent shall be entitled to conduct, at its reasonable
discretion, on reasonable prior notice and during normal working hours, periodic
field examinations of the books and records relating to the Accounts of the
Collateral Parties and the Inventory of the Collateral Parties, in each case to
ensure the adequacy of the Collateral that constitutes the Borrowing Base and
the related reporting and control systems; provided, however, that so long as no
Event of Default has occurred and is continuing, (x) if no Loans are then
outstanding hereunder, the Administrative Agent shall be limited in any
twelve-calendar-month period to one such field examination and (y) if any Loans
are then outstanding hereunder, then the Administrative Agent shall be entitled
to two such field examinations during any twelve-calendar-month period.
(c) At any time that the Administrative Agent requests, each of the Collateral
Parties will provide the Administrative Agent with appraisals or updates thereof
of its Inventory from an appraiser selected and engaged by the Administrative
Agent, and prepared on a basis satisfactory to the Administrative Agent, and
such appraisals or updates, as the case may be, will include information
required by applicable law and regulations; provided, however, that (unless the
Borrower otherwise requests in writing to the Administrative Agent that
additional appraisals of Inventory be conducted in the relevant
twelve-calendar-month period) so long as no Event of Default has occurred and is
continuing (x) if no Loans are then outstanding hereunder, the Administrative
Agent shall be limited in any twelve-calendar-month period to one such appraisal
and (y) if any Loans are then outstanding hereunder, then the Administrative
Agent shall be entitled to two such appraisals during any twelve-calendar-month
period. Each such appraisal shall be at the sole expense of the Collateral
Parties.

 

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(d) The Borrower acknowledges that the Administrative Agent, after exercising
its rights of inspection, field examination or appraisal pursuant to this
Section 5.07, may prepare and distribute to the Lenders certain Reports
pertaining to the Loan Parties’ assets for internal use by the Administrative
Agent and the Lenders.
SECTION 5.08. Compliance with Laws. The Borrower will, and will cause each
Subsidiary to, comply with all Requirements of Law with respect to it or its
property, except where non-compliance could not reasonably be expected to result
in a Material Adverse Effect or where the necessity of compliance therewith is
contested in good faith by appropriate proceedings.
SECTION 5.09. Use of Proceeds and Letters of Credit. The proceeds of the Loans
will be used only to finance general working capital needs and for other general
corporate purposes (including acquisitions), in each case of the Borrower and
the Subsidiaries. No part of the proceeds of any Loan will be used, whether
directly or indirectly, for any purpose that entails a violation of any of the
Regulations of the Board, including Regulations T, U and X. Letters of Credit
will be used only for general corporate purposes.
SECTION 5.10. Further Assurances. (a) The Borrower shall cause (i) (A) each
Domestic Material Subsidiary formed or acquired on or after the date of this
Agreement in compliance with the terms of this Agreement and (B) each Subsidiary
that otherwise qualifies as a Domestic Material Subsidiary on or after the date
of this Agreement, in each case, to become a Loan Party by executing a
supplement to the Guarantee Agreement in the form attached to the Guarantee
Agreement and (ii) (A) each Domestic Material Subsidiary that is a wholly owned
Subsidiary and formed or acquired on or after the date of this Agreement in
compliance with the terms of this Agreement and (B) each Subsidiary that
otherwise qualifies as a Domestic Material Subsidiary that is a wholly owned
Subsidiary on or after the date of this Agreement, in each case, to become a
Collateral Party by executing a supplement to the Security Agreement in the form
attached to the Security Agreement, provided that the terms of this
Section 5.10(a) shall not be required to be satisfied with respect to any
Subsidiary (x) that is subject to any legal or any contractual restriction (to
the extent such restriction does not violate any of the terms of any Loan
Document) preventing or prohibiting it from satisfying such requirement or
(y) with respect to which the Administrative Agent determines that the cost of
satisfaction of such requirement with respect thereto exceeds the value afforded
thereby (and any such Subsidiary that does not so satisfy the terms of this
Section 5.10(a) shall not become a Loan Party and/or a Collateral Party
hereunder).
(b) Subject to the limitations set forth in the Security Agreement, the Borrower
will, and will cause each Loan Party to, execute any and all further documents,
financing statements, agreements and instruments, and take all such further
actions (including the filing and recording of financing statements and other
documents), that may be required under any applicable law, or that the
Administrative Agent or the Required Lenders may reasonably request, to carry
out the terms and conditions of this Agreement and the other Loan Documents, and
to ensure perfection and priority of the Liens created or intended to be created
by the Collateral Documents, all at the expense of the Loan Parties. The
Borrower also agrees to provide to the Administrative Agent, from time to time
upon request, evidence reasonably satisfactory to the Administrative Agent as to
the perfection and priority of the Liens created or intended to be created by
the Collateral Documents.

 

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ARTICLE VI
Negative Covenants
Until the Commitments have expired or been terminated and the principal of and
interest on each Loan and all fees, expenses and other amounts payable (other
than contingent amounts not yet due) under any Loan Document have been paid in
full and all Letters of Credit have expired or been terminated (or cash
collateralized in an amount equal to 105% of the aggregate undrawn amount of all
outstanding Letters of Credit) and all LC Disbursements shall have been
reimbursed, the Borrower covenants and agrees with the Lenders that:
SECTION 6.01. Indebtedness. (a) Neither the Borrower nor any of the Subsidiaries
shall directly or indirectly create, incur, assume or otherwise become or remain
directly or indirectly liable with respect to any Indebtedness, the incurrence
of which would cause the Borrower to violate the financial covenant set forth in
Section 6.12 (giving effect to such incurrence of Indebtedness on a pro forma
basis as if such incurrence (and the application of any proceeds therefrom,
including the repayment of any Indebtedness with the proceeds of the
Indebtedness being so incurred) occurred on the first day of the applicable four
fiscal quarter period ended immediately prior to such incurrence) to the extent
such Section is in effect as of the date of such determination (or would be in
effect after giving effect to such incurrence of Indebtedness). It is understood
and agreed that any Indebtedness incurred under Section 6.01(a) of the Existing
Credit Agreement, to the extent such Indebtedness was, at the time of such
incurrence, permitted to be so incurred thereunder, shall be deemed to have been
incurred under, and in compliance with, this Section 6.01(a) as of the
Restatement Effective Date.
(b) Neither the Borrower nor any of its Subsidiaries shall at any time permit
the sum, without duplication, of (i) all Indebtedness of the Borrower and the
Subsidiaries secured by Liens plus (ii) all Indebtedness of the Subsidiaries
(including Subsidiaries acquired after the Restatement Effective Date) to exceed
$500,000,000 at any time outstanding.
(c) Notwithstanding anything to the contrary in paragraph (b) of this
Section 6.01, the following Indebtedness of the Borrower and the Subsidiaries
(including Subsidiaries acquired after the Restatement Effective Date) shall not
be prohibited by Section 6.01(b) and shall not be included in calculating the
levels of Indebtedness permitted under Section 6.01(b) regardless of whether
such Indebtedness is secured as permitted by Section 6.02:
(i) (x) Indebtedness created under the Loan Documents and (y) other Indebtedness
existing on the Restatement Effective Date and set forth in Schedule 6.01 and
extensions, renewals and replacements of any such Indebtedness, provided that
such extending, renewal or replacement Indebtedness (A) shall not be
Indebtedness of an obligor that was not an obligor with respect to the original
Indebtedness being extended, renewed or replaced (other than in the case of
Guarantees otherwise permitted by clause (iii) of this Section 6.01(c)),
(B) shall not be in a principal amount that exceeds the principal amount of the
Indebtedness being extended, renewed or replaced (plus any accrued but unpaid
interest and redemption premium thereon), (C) shall not have an earlier maturity
date or shorter weighted average life to maturity than the Indebtedness being
extended, renewed or replaced and (D) shall be subordinated to the Obligations
to the same extent as the Indebtedness being extended, renewed or replaced, if
applicable;
(ii) Indebtedness of the Borrower to any Subsidiary and of any Subsidiary to the
Borrower or any other Subsidiary, provided that (A) Indebtedness of any
Subsidiary (other than a Loan Party) owing to any Loan Party shall be subject to
Section 6.04 and (B) Indebtedness of the Borrower to any Subsidiary or of any
other Loan Party to any other Subsidiary (other than a Loan Party) shall be
subordinated to the Obligations on terms reasonably satisfactory to the
Administrative Agent;

 

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(iii) Guarantees by the Borrower of Indebtedness of any Subsidiary, and by any
Subsidiary of Indebtedness of the Borrower or any other Subsidiary, provided
that (A) the Indebtedness so Guaranteed shall not be prohibited by this Section
(other than clause (c)(ii)) and (B) Guarantees by any Loan Party of Indebtedness
of any Subsidiary (other than a Loan Party) shall be subject to Section 6.04;
(iv) (A) Indebtedness of the Borrower or any Subsidiary incurred to finance the
acquisition, construction or improvement of any fixed or capital assets,
including Capital Lease Obligations and any Indebtedness that is assumed by the
Borrower or any Subsidiary or that remains Indebtedness of an acquired entity in
connection with the acquisition of any such assets or secured by a Lien on any
such assets prior to the acquisition thereof, provided that such Indebtedness is
incurred prior to or within 90 days after such acquisition or the completion of
such construction or improvement, and (B) extensions, renewals and replacements
of any such Indebtedness so long as the outstanding principal amount of such
extensions, renewals and replacements does not exceed the principal of the
Indebtedness being extended, renewed or replaced (plus any accrued but unpaid
interest and premium thereon), provided that the aggregate principal amount of
Indebtedness permitted by this clause (iv) incurred after the Restatement
Effective Date shall not exceed $100,000,000 at any time outstanding;
(v) Indebtedness in respect of Swap Agreements permitted by Section 6.06; and
(vi) Indebtedness in respect of any financing or capital lease financing
relating to the Borrower’s or the Subsidiaries’ sea vessels in an amount not to
exceed $75,000,000 at any time outstanding.
SECTION 6.02. Liens. The Borrower will not, and will not permit any Subsidiary
to, create, incur, assume or permit to exist any Lien on any property or asset
now owned or hereafter acquired by it, or assign or sell any income or revenues
(including accounts receivable) or rights in respect of any thereof, except:
(i) Liens created pursuant to any Loan Document;
(ii) Permitted Encumbrances;
(iii) any Lien on any property or asset of the Borrower or any Subsidiary
existing on the Restatement Effective Date and set forth in Schedule 6.02,
provided that (A) such Lien shall not apply to any other property or asset of
the Borrower or any Subsidiary (other than assets financed by the same financing
source pursuant to the same financing scheme in the ordinary course of business)
and (B) such Lien shall secure only those obligations that it secured on the
Restatement Effective Date and extensions, renewals and replacements thereof so
long as the principal amount of such extensions, renewals and replacements does
not exceed the principal amount of the obligations being extended, renewed or
replaced (plus any accrued but unpaid interest and premium thereon);

 

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(iv) any Lien existing on any property or asset prior to the acquisition thereof
by the Borrower or any Subsidiary or existing on any property or asset of any
Person that becomes a Subsidiary after the Restatement Effective Date prior to
the time such Person becomes a Subsidiary, provided that (A) such Lien is not
created in contemplation of or in connection with such acquisition or such
Person becoming a Subsidiary, as the case may be, (B) such Lien shall not apply
to any other property or asset of the Borrower or any Subsidiary (other than
assets financed by the same financing source pursuant to the same financing
scheme in the ordinary course of business) and (C) such Lien shall secure only
those obligations that it secures on the date of such acquisition or the date
such Person becomes a Subsidiary, as the case may be, and extensions, renewals
and replacements thereof so long as the principal amount of such extensions,
renewals and replacements does not exceed the principal amount of the
obligations being extended, renewed or replaced (plus any accrued but unpaid
interest and premium thereon);
(v) Liens on fixed or capital assets acquired, constructed or improved
(including any such assets made the subject of a Capital Lease Obligation
incurred) by the Borrower or any Subsidiary after the Restatement Effective
Date, provided that (A) such Liens secure Indebtedness incurred to finance such
acquisition, construction or improvement and permitted by clause (iv)(A) of
Section 6.01(c) or to extend, renew or replace such Indebtedness and permitted
by clause (iv)(B) of Section 6.01(c), (B) such Liens and the Indebtedness
secured thereby are incurred prior to or within 90 days after such acquisition
or the completion of such construction or improvement (provided that this clause
(B) shall not apply to any Indebtedness permitted by clause (iv)(B) of
Section 6.01(c) or any Lien securing such Indebtedness), (C) the Indebtedness
secured thereby does not exceed the lesser of the cost of acquiring,
constructing or improving such fixed or capital asset or, in the case of
Indebtedness permitted by clause (iv)(A) of Section 6.01(c), its fair market
value at the time such security interest attaches, and in any event, the
aggregate principal amount of such Indebtedness does not exceed $100,000,000 at
any time outstanding and (D) such Liens shall not apply to any other property or
assets of the Borrower or any Subsidiary (except assets financed by the same
financing source pursuant to the same financing scheme in the ordinary course of
business);
(vi) Liens of a collecting bank arising in the ordinary course of business under
Section 4-208 of the Uniform Commercial Code in effect in the relevant
jurisdiction covering only the items being collected upon;
(vii) Liens granted by a Subsidiary in respect of Indebtedness permitted by
Section 6.01;
(viii) Liens securing obligations under Swap Agreements (and related netting
agreements) entered into after the Restatement Effective Date and permitted
under Section 6.06 in an amount not to exceed $150,000,000 on a marked-to-market
basis at any time outstanding;
(ix) Liens existing or deemed to exist securing the ship financing Indebtedness
described in Section 6.01(c)(vi) in an amount not to exceed $75,000,000,
provided that such Liens shall apply only to those assets and rights of the type
pledged under the Vessel Loan Agreement and the collateral documents entered
into in connection therewith (as the Vessel Loan Agreement and such other
documents are in effect on the Restatement Effective Date) and shall not apply
to any other property or asset of the Borrower or any Subsidiary;
(x) Liens not otherwise permitted by this Section to the extent that the
aggregate outstanding principal amount of the obligations secured thereby does
not at any time exceed $100,000,000; and
(xi) Liens created by sales contracts documenting unconsummated asset
dispositions permitted hereby, provided that such Liens attach only to those
assets that are the subject of the applicable sales contract.

 

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Notwithstanding the foregoing, none of the Liens permitted pursuant to this
Section 6.02 may at any time attach to any Collateral, other than those
permitted under clauses (i) through (iv), (vi) and (xi) of this Section 6.02.
SECTION 6.03. Fundamental Changes. (a) The Borrower will not, and will not
permit any Material Subsidiary to, merge into or consolidate with any other
Person, or permit any other Person to merge into or consolidate with it, or
liquidate or dissolve, except that, if at the time thereof and immediately after
giving effect thereto no Default shall have occurred and be continuing (i) any
Person may merge into the Borrower in a transaction in which the Borrower is the
surviving corporation and (ii) any Person (other than the Borrower) may merge
into any Subsidiary in a transaction in which the surviving entity is a
Subsidiary and (if any party to such merger is a Restricted Collateral Party, a
Collateral Party or a Loan Party) is a Restricted Collateral Party, a Collateral
Party or a Loan Party, as the case may be, provided that any such merger
involving a Person that is not a wholly owned Subsidiary immediately prior to
such merger shall not be permitted unless also permitted by Section 6.04.
(b) The Borrower will not, and will not permit any Material Subsidiary to,
engage to any material extent in any business other than businesses of the type
conducted by the Borrower and the Subsidiaries on the Restatement Effective Date
and businesses reasonably related thereto.
(c) The Borrower will not, and will not permit any other Loan Party, to sell,
transfer, lease or otherwise dispose of all or substantially all its assets,
provided that this clause (c) shall not prohibit any such sale, transfer, lease
or other disposition (i) by any Collateral Party to any other Collateral Party,
(ii) by any wholly owned Subsidiary (other than a Collateral Party) to the
Borrower or any other wholly owned Subsidiary or (iii) of assets the aggregate
fair value of which, determined as of the date of such sale, transfer, lease or
other disposition and when combined with the aggregate fair value of all assets
sold, transferred, leased or otherwise disposed of pursuant to this clause (iii)
(in each case, determined as of the date of the sale, transfer, lease or other
disposition of the applicable assets), does not exceed 15% of the consolidated
assets of the Loan Parties as determined on such date. Notwithstanding the
foregoing, (A) no Restricted Collateral Party may issue any Equity Interests
(other than to the Borrower or to another wholly owned Subsidiary), (B) neither
the Borrower nor any other Subsidiary may sell, transfer or otherwise dispose of
any Equity Interests of any Restricted Collateral Party (other than to the
Borrower or to any wholly owned Subsidiary) except in a transaction pursuant to
clause (iii) of this paragraph (c) in which 100% of the Equity Interests of such
Restricted Collateral Party are sold, transferred or otherwise disposed of and
(C) neither the Borrower nor any Restricted Collateral Party may sell, transfer,
lease or otherwise dispose of all or substantially all its assets (other than to
the Borrower or to another Restricted Collateral Party) except in a transaction
pursuant to clause (iii) of this paragraph (c).
SECTION 6.04. Investments. The Borrower will not, and will not permit any Loan
Party to, purchase or acquire (including pursuant to any merger with such
Person) any Equity Interests in or evidences of Indebtedness or other securities
(including any option, warrant or other right to acquire any of the foregoing)
of, make any loans or advances to, or Guarantee any Indebtedness of, any other
Person (other than a Loan Party), or purchase or otherwise acquire (in one
transaction or a series of transactions) any assets of any other Person (other
than a Loan Party, provided that only a Collateral Party may acquire such assets
of any other Collateral Party pursuant to this exception) constituting a
business unit, or incur an obligation (contingent or otherwise) to do any of the
foregoing (each, an “Investment”), at any time when (x) the Excess Availability
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(y) a Default or Event of Default has occurred and is continuing, provided that
so long as no Default or Event of Default shall have occurred and is continuing,
the Borrower may make Investments in an aggregate amount (each such Investment
being valued at the amount determined therefor at the date made net of any
return of capital or sale proceeds actually received in cash (which shall not
exceed the cost of such Investment) in respect of such Investment) not to exceed
$150,000,000 at any time outstanding; provided further that the Borrower shall
not, nor shall it permit any Loan Party to, make an Investment that would
otherwise be permitted by this Section if, in the Borrower’s reasonable business
judgment (taking into account, among other things, the likelihood that the
Borrower or any other Loan Party would be required to make a cash payment in
respect of such Investment as well as alternate sources of cash (other than
proceeds from Borrowings hereunder) that are reasonably likely to be available
for the funding of such Investment at the time a cash payment in respect of such
Investment would become due), such Investment (when taken together with each
other Investment made pursuant to this Section 6.04, excluding clauses
(a) through (j) of this Section 6.04) would result in Excess Availability being
less than $50,000,000 (after giving effect to any cash payments, and any
Borrowings hereunder, made (or to be made) in connection with such Investments).
Notwithstanding the foregoing, the following Investments shall be deemed not to
be covered or restricted by this Section:
(a) Investments existing on the Restatement Effective Date and set forth on
Schedule 6.04 and Permitted Investments;
(b) payroll, travel and similar advances to cover matters that are expected at
the time of such advances ultimately to be treated as expenses of the Borrower
or any Subsidiary for accounting purposes and that are made in the ordinary
course of business;
(c) Investments received in connection with the bankruptcy or reorganization of,
or settlement of delinquent accounts and disputes with, customers and suppliers,
in each case in the ordinary course of business;
(d) Investments in the form of Swap Agreements permitted by Section 6.06;
(e) Investments of any Person existing at the time such Person becomes a
Subsidiary or consolidates or merges with the Borrower or any Subsidiary so long
as such Investments were not made in contemplation of such Person becoming a
Subsidiary or of such consolidation or merger;
(f) Investments resulting from pledges or deposits described in clause (c) or
(d) of the definition of the term “Permitted Encumbrance”;
(g) Investments received in connection with the disposition of any asset
permitted by Section 6.03(c);
(h) receivables or other trade payables owing to the Borrower or a Subsidiary if
created or acquired in the ordinary course of business and payable or
dischargeable in accordance with customary trade terms, provided that such trade
terms may include such concessionary trade terms as the Borrower or any
Subsidiary deems reasonable under the circumstances;
(i) Investments in or to any Loan Party; and
(j) Investments to the extent funded with the proceeds of any substantially
concurrent issuance of Qualified Equity Interests to the extent that such
issuance does not result in a Change in Control.

 

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SECTION 6.05. Sale and Leaseback Transactions. Neither the Borrower nor any of
the Subsidiaries shall become liable, directly or by way of a Guarantee, with
respect to any lease, whether or not such lease results in a Capital Lease
Obligation, of any property (whether real or personal or mixed) whether now
owned or hereafter acquired, that the Borrower or any Subsidiary has sold or
transferred or is to sell or transfer to any other Person after the Restatement
Effective Date (a “Sale and Leaseback Transaction”), provided that the Borrower
or a Subsidiary may enter into a Sale and Leaseback Transaction if (a) at the
time of such Sale and Leaseback Transaction, no Event of Default is continuing,
(b) the proceeds from the sale of the subject property shall be at least equal
to 80% of its fair market value and (c) if such Sale and Leaseback Transaction
results in a Capital Lease Obligation, such Capital Lease Obligation is not
prohibited by Section 6.01 and any Lien made the subject of such Capital Lease
Obligation is not prohibited by Section 6.02.
SECTION 6.06. Swap Agreements. The Borrower will not, and will not permit any
Subsidiary to, enter into any Swap Agreement for speculative purposes.
SECTION 6.07. Restricted Payments. (a) The Borrower will not, and will not
permit any Subsidiary to, declare or make, or agree to pay or make, directly or
indirectly, any Restricted Payment, or incur any obligation (contingent or
otherwise) to do so, if (i) a Default has occurred and is continuing or would
result therefrom or (ii) such Restricted Payment is not at the time permitted by
a Requirement of Law or any agreement or instrument applicable to the Borrower
or such Subsidiary, provided that this paragraph (a) shall not restrict
dividends or similar distributions payable solely in Qualified Equity Interests
or made by Subsidiaries to wholly owned Subsidiaries or to the Borrower (it
being understood that this proviso shall not permit any such dividend or similar
distribution (A) from a Domestic Subsidiary to a Foreign Subsidiary or (B) in
the case of any such dividend or distribution comprised of Collateral, from a
Collateral Party to an entity that is not a Collateral Party).
(b) Notwithstanding anything in Section 6.07(a) to the contrary, the aggregate
amount of Restricted Payments permitted to be made (or with respect to which
obligations (contingent or otherwise) to do so are permitted to be incurred) by
the Borrower and the Subsidiaries pursuant to this Section 6.07 (excluding any
Restricted Payments made (or with respect to which obligations (contingent or
otherwise) to do so have been entered into) by the Borrower or any Subsidiary at
any time when (x) Excess Availability at such time is equal to or greater than
the Threshold Amount, (y) the Fixed Charge Coverage Ratio at such time,
determined for the period of four consecutive fiscal quarters most recently
ended at or prior to such time, is equal to or greater than 1.10 to 1.00 and
(z) no Default or Event of Default has occurred and is continuing) shall not
exceed (i) $25,000,000 in any calendar year and (ii) $50,000,000 in the
aggregate for the term of this Agreement, provided that this paragraph (b) shall
not restrict dividends or similar distributions payable solely in Qualified
Equity Interests or made by Subsidiaries to wholly owned Subsidiaries or to the
Borrower (it being understood that this proviso shall not permit any such
dividend or similar distribution (A) from a Domestic Subsidiary to a Foreign
Subsidiary or (B) in the case of any such dividend or distribution comprised of
Collateral, from a Collateral Party to an entity that is not a Collateral
Party).
SECTION 6.08. Transactions with Affiliates. The Borrower shall not, and shall
not suffer or permit any Material Subsidiary to, enter into any transaction with
any Affiliate (other than the Borrower or a wholly owned Subsidiary) of the
Borrower, except transactions (a) entered into in good faith and (b) at prices
and on terms and conditions not less favorable to the Borrower or such
Subsidiary than could be obtained on an arm’s-length basis from unrelated third
parties.

 

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SECTION 6.09. Restrictive Agreements. The Borrower will not, and will not permit
any Material Subsidiary to, directly or indirectly, enter into, incur or permit
to exist any agreement or other arrangement that prohibits, restricts or imposes
any condition upon (a) the ability of the Borrower or any Material Subsidiary to
create, incur or permit to exist any Lien upon any of its property or assets or
(b) the ability of any Material Subsidiary to pay dividends or other
distributions with respect to any of its Equity Interests or to make or repay
loans or advances to the Borrower or any other Subsidiary or to Guarantee
Indebtedness of the Borrower or any other Subsidiary, provided that (i) the
foregoing shall not apply to restrictions and conditions imposed by (A) law or
(B) any Loan Document, (ii) the foregoing shall not apply to restrictions or
conditions existing on the Restatement Effective Date and identified on
Schedule 6.09 (but shall apply to any extension or renewal of, or any amendment,
modification or replacement expanding the scope of, any such restriction or
condition), (iii) the foregoing shall not apply to customary restrictions and
conditions contained in agreements relating to the sale of a Subsidiary or any
assets pending such sale, provided that such restrictions and conditions apply
only to the Subsidiary or assets that is or are to be sold and such sale is
permitted hereunder, (iv) paragraph (a) of the foregoing shall not apply to
restrictions or conditions imposed by any agreement relating to secured
Indebtedness permitted by this Agreement if such restrictions or conditions
apply only to the property or assets securing such Indebtedness, (v) paragraph
(a) of the foregoing shall not apply to customary provisions in leases and other
contracts restricting the assignment thereof, (vi) paragraph (a) of the
foregoing shall not apply to any existing or future joint venture agreement that
restricts the ability of any party to such agreement to create, incur or permit
a Lien on the equity interests in the joint venture, provided that the Borrower
and any Material Subsidiary party to such agreement collectively own no more
than 81 percent of the equity interests in such joint venture and
(vii) paragraph (a) of the foregoing shall not apply to restrictions or
conditions imposed by any agreement if the terms of such agreement expressly
permit the creation, incurrence and existence of Liens to secure Indebtedness or
other Secured Obligations under this Agreement and extensions, renewals and
replacements of any such Indebtedness or other Secured Obligations.
SECTION 6.10. Amendment of Material Documents. The Borrower will not, and will
not permit any Subsidiary to, amend, modify, waive, terminate or release its
certificate of incorporation, by-laws or other organizational documents, if the
effect of such amendment, modification, waiver, termination or release is
materially adverse to the Borrower and the Subsidiaries, taken as a whole, or
the Lenders.
SECTION 6.11. Changes in Fiscal Periods. Without the prior consent of the
Administrative Agent, the Borrower will neither (a) permit its fiscal year or
the fiscal year of any Subsidiary to end on a day other than December 31, nor
(b) change its method of determining fiscal quarters.
SECTION 6.12. Fixed Charge Coverage Ratio. If, at any time, Excess Availability
is less than the greater of (a) $40,000,000 and (b) 15% of the lesser of (i) the
aggregate Revolving Commitments at such time and (ii) the Borrowing Base at such
time, then the Borrower will not permit the Fixed Charge Coverage Ratio at such
time, determined for the period of four consecutive fiscal quarters most
recently ended at or prior to such time, to be less than 1.10 to 1.00.
ARTICLE VII
Events of Default
If any of the following events (any such event, an “Event of Default”) shall
occur:
(a) the Borrower shall fail to pay any principal of any Loan or any
reimbursement obligation in respect of any LC Disbursement when and as the same
shall become due and payable, whether at the due date thereof or at a date fixed
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(b) the Borrower shall fail to pay any interest on any Loan or any fee or any
other amount (other than an amount referred to in paragraph (a) of this Article)
payable under any Loan Document, when and as the same shall become due and
payable, and such failure shall continue unremedied for a period of five
Business Days;
(c) any representation or warranty made or deemed made by or on behalf of the
Borrower or any Material Subsidiary in or in connection with the Existing Credit
Agreement (to the extent made prior to the Restatement Effective Date and not
waived), any Loan Document or any amendment or modification thereof or waiver
thereunder, or in any report, certificate, financial statement or other document
furnished pursuant to or in connection with any Loan Document or any amendment
or modification thereof or waiver thereunder that is qualified by materiality
shall prove to have been incorrect or any representation or warranty that is not
so qualified shall prove to have been incorrect in any material respect when
made or deemed made;
(d) the Borrower shall fail to observe or perform any covenant, condition or
agreement contained in Section 5.02, 5.03 (with respect to the existence of the
Borrower) or 5.09 or in Article VI of this Agreement or any Collateral Party
shall fail to observe or perform any covenant, condition or agreement contained
in Section 4.01(j) or Article VII, in each case of the Security Agreement;
provided, however, that, without limiting the effect of any other Default or
Event of Default under this Article VII, any Default arising under Section 5.02
(or any Default arising under a failure of the conditions set forth in
Section 4.02 arising solely as a result of a failure to comply with
Section 5.02) shall be deemed to be cured upon the giving of such notice by the
Borrower;
(e) the Borrower or any other Loan Party shall fail to observe or perform any
covenant, condition or agreement contained in any Loan Document (other than
those specified in paragraph (a), (b) or (d) of this Article), and, except as
otherwise provided in such Loan Document, such failure shall continue unremedied
for a period of 30 days after notice thereof from any Lender or the
Administrative Agent to the Borrower;
(f) the Borrower or any Subsidiary shall fail to make any payment (whether of
principal or interest and regardless of amount) in respect of any Material
Indebtedness, when and as the same shall become due and payable after the
expiration of any applicable grace periods;
(g) any event or condition occurs (including the triggering of any change in
control or similar event with respect to the Borrower) (i) that results in any
Material Indebtedness becoming due prior to its scheduled maturity or that
enables or permits (with all applicable grace periods having expired, provided
that, during the applicable grace period, no additional consideration is paid or
additional rights are granted in respect of such Material Indebtedness) the
holder or holders of any Material Indebtedness or any trustee or agent on its or
their behalf to cause any Material Indebtedness to become due or to require the
prepayment, repurchase, redemption or defeasance thereof, prior to its scheduled
maturity or (ii) the effect of which event or condition is to cause, or to
permit the holder or holders of any Material Indebtedness (or a trustee or agent
on behalf of such holder or holders) to require, with the giving of notice if
required, any Material Indebtedness to be repurchased, prepaid, defeased or
redeemed (automatically or otherwise), prior to its stated maturity, provided
that this paragraph (g) shall not apply to secured Indebtedness that becomes due
as a result of the sale, transfer or other disposition (including as a result of
a casualty or condemnation event) of the property or assets securing such
Indebtedness (to the extent such sale, transfer or other disposition is not
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(h) an involuntary proceeding shall be commenced or an involuntary petition
shall be filed seeking (i) liquidation, reorganization or other relief in
respect of the Borrower or any Material Subsidiary or their debts, or of a
substantial part of their assets, under any Federal, state or foreign
bankruptcy, insolvency, receivership or similar law now or hereafter in effect
or (ii) the appointment of a receiver, trustee, custodian, sequestrator,
conservator or similar official for the Borrower or any Material Subsidiary or
for a substantial part of their assets, and, in any such case, such proceeding
or petition shall continue undismissed or unstayed for 60 days or an order or
decree approving or ordering any of the foregoing shall be entered;
(i) the Borrower or any Material Subsidiary shall (i) voluntarily commence any
proceeding or file any petition seeking liquidation, reorganization or other
relief under any Federal, state or foreign bankruptcy, insolvency, receivership
or similar law now or hereafter in effect, (ii) consent to the institution of,
or fail to contest in a timely and appropriate manner, any proceeding or
petition described in paragraph (h) of this Article, (iii) apply for or consent
to the appointment of a receiver, trustee, custodian, sequestrator, conservator
or similar official for the Borrower or any Material Subsidiary or for a
substantial part of their assets, (iv) file an answer admitting the material
allegations of a petition filed against it in any such proceeding, (v) make a
general assignment for the benefit of creditors or (vi) take any action for the
purpose of effecting any of the foregoing;
(j) the Borrower or any Material Subsidiary shall become unable, admit in
writing its inability or fail generally to pay its debts as they become due;
(k) one or more judgments for the payment of money in an aggregate amount in
excess of $50,000,000 shall be rendered against the Borrower, any Material
Subsidiary or any combination thereof (provided that in determining whether the
foregoing threshold is satisfied, there shall be excluded any portion of such
judgments that is fully covered by a third party insurance company rated not
less that “B++” by A.M. Best (less any applicable deductible) and as to which
the insurer has not disputed, in writing, its responsibility to cover such
judgment) and the same shall remain unpaid or undischarged for a period of 30
consecutive days during which execution shall not be effectively stayed, or any
action shall be legally taken by a judgment creditor to attach or levy upon any
assets of the Borrower or any Material Subsidiary to enforce any such judgment;
(l) an ERISA Event shall have occurred that, in the opinion of the Required
Lenders, when taken together with all other ERISA Events that have occurred,
could reasonably be expected to have a Material Adverse Effect;
(m) any Loan Document shall for any reason be asserted by the Borrower not to be
a legal, valid and binding obligation of the Borrower;
(n) a Change in Control shall occur;
(o) the Guarantee Agreement shall fail to remain in full force or effect or any
action shall be taken by any Loan Party to discontinue or to assert the
invalidity or unenforceability of the Guarantee Agreement, or any Loan Party
shall deny that it has any further liability under the Guarantee Agreement to
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(p) any Collateral Document shall for any reason fail to create a valid and
perfected first priority security interest in any Collateral purported to be
covered thereby, except as permitted by the terms hereof or of any Collateral
Document, or any Collateral Document shall fail to remain in full force or
effect or any action shall be taken to discontinue or to assert the invalidity
or unenforceability of any Collateral Document, then, and in every such event
(other than an event with respect to the Borrower described in paragraph (h) or
(i) of this Article), and at any time thereafter during the continuance of such
event, the Administrative Agent may, and at the request of the Required Lenders
shall, by notice to the Borrower, take either or both of the following actions,
at the same or different times: (i) terminate the Commitments, and thereupon the
Commitments shall terminate immediately, and (ii) declare the Loans then
outstanding to be due and payable in whole (or in part, in which case any
principal not so declared to be due and payable may thereafter be declared to be
due and payable), and thereupon the principal of the Loans so declared to be due
and payable, together with accrued interest thereon and all fees and other
obligations of the Borrower accrued hereunder, shall become due and payable
immediately, without presentment, demand, protest or other notice of any kind,
all of which are hereby waived by the Borrower; and in case of any event with
respect to the Borrower described in paragraph (h) or (i) of this Article, the
Commitments shall automatically terminate and the principal of the Loans then
outstanding, together with accrued interest thereon and all fees and other
obligations of the Borrower accrued hereunder, shall automatically become due
and payable, without presentment, demand, protest or other notice of any kind,
all of which are hereby waived by the Borrower.
ARTICLE VIII
The Administrative Agent
Each of the Lenders and the Issuing Bank hereby irrevocably appoints the
Administrative Agent as its agent and authorizes the Administrative Agent to
take such actions on its behalf, including execution of the other Loan
Documents, and to exercise such powers as are delegated to the Administrative
Agent by the terms of the Loan Documents, together with such actions and powers
as are reasonably incidental thereto. The provisions of this Article are solely
for the benefit of the Administrative Agent, the Lenders and the Issuing Bank,
and the Borrower shall not have rights as a third party beneficiary of any of
such provisions.
The bank serving as the Administrative 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 the Administrative Agent, and such bank
and its Affiliates may accept deposits from, lend money to and generally engage
in any kind of business with the Borrower or any Subsidiary or other Affiliate
thereof as if it were not the Administrative Agent hereunder.
The Administrative Agent shall not have any duties or obligations except those
expressly set forth in the Loan Documents. Without limiting the generality of
the foregoing, (a) the Administrative Agent shall not be subject to any
fiduciary or other implied duties, regardless of whether a Default has occurred
and is continuing, (b) the Administrative Agent shall not have any duty to take
any discretionary action or exercise any discretionary powers, except
discretionary rights and powers expressly contemplated by the Loan Documents
that the Administrative Agent is required to exercise in writing as directed by
the Required Lenders (or such other number or percentage of the Lenders as shall
be necessary or believed by the Administrative Agent in good faith to be
necessary under the circumstances as provided in Section 2.05(j) or
Section 9.02), and (c) except as expressly set forth in the Loan Documents, the
Administrative Agent shall not have any duty to disclose, and shall not be
liable for the failure to disclose, any information relating to the Borrower or
any Subsidiary that is communicated to or obtained by the bank serving as
Administrative Agent or any of its Affiliates in any capacity. The
Administrative Agent shall not be liable for any action taken or not taken by it
with the consent or at the request of the Required Lenders (or such other number
or percentage of the Lenders as shall be necessary under the circumstances as
provided in Section 2.05(j) or Section 9.02 or believed by the Administrative
Agent in good faith to be necessary) or in the absence of its own gross
negligence or wilful misconduct. The Administrative Agent shall be deemed not to
have knowledge of any Default unless and until written notice thereof is given
to the Administrative Agent by the Borrower or a Lender, and the Administrative
Agent shall not be responsible for or have any duty to ascertain or inquire into
(i) any statement, warranty or representation made in or in connection with any
Loan Document, (ii) the contents of any certificate, report or other document
delivered thereunder or in connection therewith, (iii) the performance or
observance of any of the covenants, agreements or other terms or conditions set
forth in any Loan Document or the occurrence of any Default, (iv) the validity,
enforceability, effectiveness or genuineness of any Loan Document or any other
agreement, instrument or document, (v) the creation, perfection or priority of
Liens on the Collateral or the existence of the Collateral, or (vi) the
satisfaction of any condition set forth in Article IV or elsewhere in any Loan
Document, other than to confirm receipt of items expressly required to be
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The Administrative Agent shall be entitled to rely upon, and shall not incur any
liability for relying upon, any notice, request, certificate, consent,
statement, instrument, document or other writing (including any electronic
message, Adobe pdf file, Internet or intranet website posting or other
distribution) believed by it to be genuine and to have been signed or sent or
otherwise authenticated by the proper Person. The Administrative Agent also may
rely upon any statement made to it orally or by telephone and believed by it to
be made by the proper Person, and shall not incur any liability for relying
thereon. The Administrative Agent may consult with legal counsel (who may be
counsel for the Loan Parties), 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.
The Administrative Agent may perform any and all its duties and exercise its
rights and powers by or through any one or more sub-agents appointed by the
Administrative Agent, provided that the Administrative Agent shall remain liable
for the performance of such obligations and duties. The Administrative Agent and
any such sub-agent may perform any and all its duties and exercise its rights
and powers by or through their respective Related Parties, provided that the
Administrative Agent shall remain liable for the performance of such obligations
and duties. The exculpatory provisions of this Article shall apply to any such
sub-agent and to the Related Parties of the Administrative 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 Administrative Agent.
In determining compliance with any condition hereunder to the making of a Loan,
or the issuance, amendment, renewal or extension of a Letter of Credit, that by
its terms must be fulfilled to the satisfaction of a Lender or the Issuing Bank,
the Administrative Agent may presume that such condition is satisfactory to such
Lender or the Issuing Bank unless the Administrative Agent shall have received
notice to the contrary from such Lender or the Issuing Bank prior to the making
of such Loan or the issuance, amendment, renewal or extension of such Letter of
Credit.
Subject to the appointment and acceptance of a successor Administrative Agent as
provided in this paragraph, the Administrative Agent may resign at any time upon
notice to the Lenders, the Issuing Bank and the Borrower. Upon any such
resignation, the Required Lenders shall have the right, with the consent of the
Borrower in the absence of a continuing Event of Default, to appoint a
successor. If no successor shall have been so appointed by the Borrower and the
Required Lenders and shall have accepted such appointment within 30 days after
the retiring Administrative Agent gives notice of its resignation, then the
retiring Administrative Agent may, on behalf of the Lenders and the Issuing
Bank, appoint a successor Administrative Agent that shall be a commercial bank
with an office in New York, New York, or an Affiliate of any such commercial
bank, in either case, acceptable to the Borrower in the absence of a continuing
Event of Default (such acceptance not to be unreasonably withheld or delayed).
Upon the acceptance of its appointment as Administrative Agent hereunder by a
successor, such successor shall succeed to and become vested with all the
rights, powers, privileges and duties of the retiring Administrative Agent, and
the retiring Administrative Agent shall be discharged from all its duties and
obligations under the Loan Documents. The fees payable by the Borrower to a
successor Administrative Agent shall be the same as those payable to its
predecessor unless otherwise agreed in writing between the Borrower and such
successor. After the Administrative Agent’s resignation hereunder, the
provisions of this Article and Section 9.03 shall continue in effect for the
benefit of such retiring Administrative Agent, its sub-agents and their
respective Related Parties in respect of any actions taken or omitted to be
taken by any of them while the retiring Administrative Agent was acting as
Administrative Agent.

 

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Each Lender and the Issuing Bank acknowledges that it has, independently and
without reliance upon the Administrative 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 and the Issuing Bank also acknowledges that it will,
independently and without reliance upon the Administrative 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 any Loan
Document or any related agreement or any document furnished thereunder.
Notwithstanding anything herein to the contrary, none of the Arrangers and the
other agents listed on the cover page hereof shall have any powers, duties or
responsibilities under any Loan Document, except in its capacity, as applicable,
as the Administrative Agent, a Lender or the Issuing Bank hereunder.
Each Lender hereby agrees that (a) it has requested a copy of each Report
prepared by or on behalf of the Administrative Agent; (b) the Administrative
Agent (i) makes no representation or warranty, express or implied, as to the
completeness or accuracy of any Report or any of the information contained
therein or any inaccuracy or omission contained in or relating to a Report and
(ii) shall not be liable for any information contained in any Report; (c) the
Reports are not comprehensive audits or examinations, and that any Person
performing any field examination will inspect only specific information
regarding the Loan Parties and will rely significantly upon the Loan Parties’
books and records, as well as on representations of the Loan Parties’ personnel
and that the Administrative Agent undertakes no obligation to update, correct or
supplement the Reports; (d) it will keep all Reports confidential and strictly
for its internal use, not share the Report with any Loan Party or any other
Person except as otherwise permitted pursuant to this Agreement; and (e) without
limiting the generality of any other indemnification provision contained in this
Agreement, it will pay and protect, and indemnify, defend, and hold the
Administrative Agent and any such other Person preparing a Report harmless from
and against, the claims, actions, proceedings, damages, costs, expenses, and
other amounts (including reasonable attorney fees) incurred by such Person as
the direct or indirect result of disclosure of any such Report to a third party
by such indemnifying Lender in violation of the terms hereof.
ARTICLE IX
Miscellaneous
SECTION 9.01. Notices. (a) Except in the case of notices and other
communications expressly permitted to be given by telephone, 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 telecopy or Adobe pdf file, as follows:
(i) if to the Borrower or any Loan Party, to the Borrower at:
550 West Adams Street
Chicago, IL 60661
Attention: Vice President and Treasurer
Telecopy No.: (312) 672-3883
with a copy to:
Corporate Secretary
Telecopy No.: (312) 672-7748;

 

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(ii) if to the Administrative Agent, the Issuing Bank or the Swingline Lender,
to:
JPMorgan Chase Bank, N.A.
1111 Fannin, 10th Floor
Houston, Texas 77002
Attention: Marshella B. Williams
Telecopy No.: (713) 427-6307
email: Marshella.B.Williams@chase.com
with a copy to:
JPMorgan Chase Bank, N.A.
383 Madison Avenue
New York, NY 10179
Attention: Peter Predun
Telecopy No.: (212) 270-5100
email: peter.predun@jpmorgan.com; and
(iii) if to any other Lender, to it at its address (or telecopy number) set
forth in its Administrative Questionnaire.
All such notices and other communications (i) sent by hand or overnight courier
service, or mailed by certified or registered mail, shall be deemed to have been
given when received or (ii) sent by telecopy or by Adobe pdf file shall be
deemed to have been given when sent, provided that if not given during normal
business hours for the recipient, shall be deemed to have been given at the
opening of business on the next Business Day for the recipient.
(b) Any party hereto may change its address or telecopy number for notices and
other communications hereunder by notice to the other parties hereto. Notices
and other communications to the Lenders and the Issuing Bank hereunder may also
be delivered or furnished by electronic communication (including e-mail, Adobe
pdf file and Internet or intranet websites) pursuant to procedures approved by
the Administrative Agent, provided that the foregoing shall not apply to notices
to any Lender or the Issuing Bank pursuant to Article II if such Lender or the
Issuing Bank, as applicable, has notified the Administrative Agent that it is
incapable of receiving notices under such Article by electronic communication.
The Administrative Agent or the Borrower (on behalf of the Loan Parties) may, in
its discretion, agree to accept notices and other communications to it hereunder
by electronic communications pursuant to procedures approved by it, provided
that approval of such procedures may be limited to particular notices or
communications. All notices and other communications given to any party hereto
in accordance with the provisions of this Agreement shall be deemed to have been
given on the date of receipt.

 

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SECTION 9.02. Waivers; Amendments. (a) No failure or delay by the Administrative
Agent, the Issuing Bank or any Lender in exercising any right or power under any
Loan Document shall operate as a waiver thereof, nor shall any single or partial
exercise of any such right or power, or any abandonment or discontinuance of
steps to enforce such a right or power, preclude any other or further exercise
thereof or the exercise of any other right or power. The rights and remedies of
the Administrative Agent, the Issuing Bank and the Lenders hereunder and under
the other Loan Documents are cumulative and are not exclusive of any rights or
remedies that they would otherwise have. No waiver of any provision of any Loan
Document or consent to any departure by any Loan Party therefrom shall in any
event be effective unless the same shall be permitted by paragraph (b) of this
Section, and then such waiver or consent shall be effective only in the specific
instance and for the purpose for which given. Without limiting the generality of
the foregoing, the making of a Loan or the issuance, amendment, renewal or
extension of a Letter of Credit shall not be construed as a waiver of any
Default, regardless of whether the Administrative Agent, any Lender or the
Issuing Bank may have had notice or knowledge of such Default at the time. No
notice to or demand on the Borrower or any other Loan Party in any case shall
entitle the Borrower or any other Loan Party to any other or further notice or
demand in similar or other circumstances.
(b) Except as provided in Section 2.19 with respect to any Revolving Commitment
Increase, neither any Loan Document nor any provision thereof may be waived,
amended or modified except, in the case of this Agreement, pursuant to an
agreement or agreements in writing entered into by the Borrower and the Required
Lenders or, in the case of any other Loan Document, pursuant to an agreement or
agreements in writing entered into by the Administrative Agent and the
applicable Loan Parties, in each case with the consent of the Required Lenders,
provided that no such agreement shall (i) increase the Commitment of any Lender
without the written consent of such Lender, (ii) reduce the principal amount of
any Loan or LC Disbursement or reduce the rate of interest thereon, or reduce or
forgive any fees payable hereunder, without the written consent of each Lender
affected thereby, (iii) postpone the maturity of any Loan, or the required date
of reimbursement of any LC Disbursement, or any date for the payment of any
interest or fees payable hereunder, or reduce or forgive the amount of, waive or
excuse any such payment, or postpone the scheduled date of expiration of any
Commitment, without the written consent of each Lender affected thereby,
(iv) change Section 2.17(b) or (d) or any other provision of this Agreement in a
manner that would alter the pro rata sharing of payments required thereby,
without the written consent of each Lender adversely affected thereby,
(v) change any of the provisions of this Section or the percentage set forth in
the definition of “Required Lenders” or any other provision of any Loan Document
specifying the number or percentage of Lenders required to waive, amend or
modify any rights thereunder or make any determination or grant any consent
thereunder, without the written consent of each Lender (it being understood
that, with the consent of the Required Lenders, additional extensions of credit
pursuant to this Agreement may be included in the determination of the Required
Lenders on substantially the same basis as the Revolving Commitments on the
Restatement Effective Date), (vi) modify the protections afforded to an SPV
pursuant to the provisions of Section 9.04(e) without the written consent of
such SPV, (vii) release any material Loan Party from its Guarantee under the
Guarantee Agreement (except as expressly provided in the Guarantee Agreement),
or limit its liability in respect of such Guarantee, without the written consent
of each Lender, (viii) release all or substantially all the Collateral from the
Liens of the Collateral Documents, without the written consent of each Lender or
(ix) change any of the provisions of the definitions of “Eligible Accounts”,
“Eligible Inventory” or “Borrowing Base” (including the advance rates referenced
therein and any defined term used therein relevant to the determination of the
Borrowing Base), without the written consent of Lenders having Revolving
Exposure and unused Revolving Commitments, if any, representing more than 75% of
the sum of the total Revolving Exposure and unused Revolving Commitments at such
time; provided further that no such agreement shall amend, modify or otherwise
affect the rights or duties of the Administrative Agent, the Issuing Bank or the
Swingline Lender without the prior written consent of the Administrative Agent,
the Issuing Bank or the Swingline Lender, as the case may be.

 

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(c) In connection with any proposed amendment, modification, waiver or
termination (a “Proposed Change”) requiring the consent of all Lenders or all
affected Lenders, if the consent of the Required Lenders to such Proposed Change
is obtained, but the consent to such Proposed Change of other Lenders whose
consent is required is not obtained (any such Lender whose consent is not
obtained as described in paragraph (b) of this Section being referred to as a
“Non-Consenting Lender”), then, so long as the Lender that is acting as
Administrative Agent is not a Non-Consenting Lender, the Borrower may, at its
sole expense and effort, upon notice to such Non-Consenting Lender and the
Administrative Agent, require such Non-Consenting Lender to assign and delegate,
without recourse (in accordance with and subject to the restrictions contained
in Section 9.04), all its interests, rights and obligations under this Agreement
to an assignee that shall assume such obligations (which assignee may be another
Lender, if a Lender accepts such assignment), provided that (i) the Borrower
shall have received the prior written consent of the Administrative Agent, the
Issuing Bank and the Swingline Lender, which consent shall not unreasonably be
withheld or delayed, (ii) such Non-Consenting Lender shall have received payment
of an amount equal to the outstanding principal of its Loans and participations
in LC Disbursements, Swingline Loans and Overadvances, accrued interest thereon,
accrued fees and all other amounts payable to it hereunder from the assignee (to
the extent of such outstanding principal and accrued interest and fees) or the
Loan Parties (in the case of all other amounts) and (iii) the Loan Parties or
such assignee shall have paid to the Administrative Agent the processing and
recordation fee specified in Section 9.04(b).
SECTION 9.03. Expenses; Indemnity; Damage Waiver. (a) The Borrower shall pay (i)
all reasonable out-of-pocket expenses (including reasonable expenses incurred in
connection with due diligence) incurred by the Administrative Agent and its
Affiliates, including the reasonable fees, charges and disbursements of counsel
for the Administrative Agent, in connection with the syndication of the credit
facilities provided for herein, the preparation and administration of the Loan
Documents or any amendments, modifications or waivers of the provisions thereof
(whether or not the transactions contemplated hereby or thereby shall be
consummated), (ii) all reasonable out-of-pocket expenses incurred by the Issuing
Bank in connection with the issuance, amendment, renewal or extension of any
Letter of Credit or any demand for payment thereunder and (iii) all reasonable
out-of-pocket expenses incurred by the Administrative Agent, the Issuing Bank or
any Lender, including the fees, charges and disbursements of any counsel for the
Administrative Agent, the Issuing Bank or any Lender, in connection with the
enforcement or protection of its rights in connection with the Loan Documents,
including its rights under this Section, or in connection with the Loans made or
Letters of Credit issued hereunder, including all such reasonable out-of-pocket
expenses incurred during any workout or restructuring (and related negotiations)
in respect of such Loans or Letters of Credit.
(b) The Borrower shall indemnify the Administrative Agent, the Issuing Bank and
each Lender, and each Related Party of any of the foregoing Persons (each such
Person being called an “Indemnitee”) against, and hold each Indemnitee harmless
from, any and all out-of-pocket losses, claims, damages, liabilities and related
reasonable expenses, including the reasonable fees, charges and disbursements of
any counsel for any Indemnitee, incurred by or asserted against any Indemnitee
by any third party or by the Borrower or any Subsidiary arising out of, in
connection with, or as a result of (i) the execution or delivery of any Loan
Document or any other agreement or instrument contemplated thereby, the
performance by the parties to the Loan Documents of their respective obligations
thereunder or the consummation of the Transactions or any other transactions
contemplated thereby, (ii) any Loan or Letter of Credit or the use of the
proceeds therefrom (including any refusal by the Issuing Bank to honor a demand
for payment under a Letter of Credit if the documents presented in connection
with such demand do not strictly comply with the terms of such Letter of
Credit), (iii) any actual or alleged presence or Release of Hazardous Materials
on, at, to or from any property currently or formerly owned or operated by the
Borrower or any Subsidiary, or any other Environmental Liability related in any
way to the Borrower or any Subsidiary or (iv) any actual or prospective claim,
litigation, 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 the Borrower or any Subsidiary and regardless of whether any
Indemnitee is a party thereto, provided that such indemnity shall not, as to any
Indemnitee, be available to the extent that such losses, claims, damages,
liabilities or related expenses are determined by a court of competent
jurisdiction by final, non-appealable judgment to have resulted from the gross
negligence or wilful misconduct of such Indemnitee.

 

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(c) To the extent that the Borrower fails to pay any amount required to be paid
by it to the Administrative Agent, the Issuing Bank or the Swingline Lender
under paragraph (a) or (b) of this Section and without limiting the Borrower’s
obligation to do so, each Lender severally agrees to pay to the Administrative
Agent, the Issuing Bank or the Swingline Lender, as the case may be, such
Lender’s Applicable Percentage (determined as of the time that the applicable
unreimbursed expense or indemnity payment is sought) of such unpaid amount,
provided that the unreimbursed expense or indemnified loss, claim, damage,
liability or related expense, as the case may be, was incurred by or asserted
against the Administrative Agent, the Issuing Bank or the Swingline Lender in
its capacity as such. The obligations of the Lenders under this paragraph (c)
are subject to the last sentence of Section 2.02(a) (which shall apply mutatis
mutandis to the Lenders’ obligations under this paragraph (c)).
(d) To the fullest extent permitted by applicable law, the Borrower shall not
assert, and 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, any Loan Document or any agreement or instrument contemplated thereby, the
Transactions, any Loan or Letter of Credit or the use of the proceeds thereof.
(e) All amounts due under this Section shall be payable not later than three
Business Days after written demand therefor setting forth the basis for such
claim in reasonable detail.
SECTION 9.04. Successors and Assigns. (a) The provisions of this Agreement shall
be binding upon and inure to the benefit of the parties hereto and their
respective successors and assigns permitted hereby (including any Affiliate of
the Issuing Bank that issues any Letter of Credit), except that (i) the Borrower
may not assign or otherwise transfer any of its rights or obligations hereunder
without the prior written consent of each Lender (and any attempted assignment
or transfer by the Borrower without such consent shall be null and void) and
(ii) no Lender may assign or otherwise transfer its rights or obligations
hereunder except in accordance with this Section. Nothing in this Agreement,
expressed or implied, shall be construed to confer upon any Person (other than
the parties hereto, their respective successors and assigns permitted hereby
(including any Affiliate of the Issuing Bank that issues any Letter of Credit),
Participants (to the extent provided in paragraph (c) of this Section) and, to
the extent expressly contemplated hereby, the Related Parties of each of the
Administrative Agent, the Issuing Bank and the Lenders) any legal or equitable
right, remedy or claim under or by reason of this Agreement.
(b) (i) Subject to the conditions set forth in paragraph (b)(ii) below, any
Lender may assign to one or more assignees all or a portion of its rights and
obligations under this Agreement (including all or a portion of its Commitment
and the Loans at the time owing to it) with the prior written consent (such
consent not to be unreasonably withheld or delayed) of (A) the Borrower,
provided that no consent of the Borrower shall be required for an assignment to
a Lender, an Affiliate of a Lender, an Approved Fund (as defined below) or, if
an Event of Default has occurred and is continuing, any other assignee; (B) the
Administrative Agent; and (C) the Issuing Bank.
(ii) Assignments shall be subject to the following additional conditions:
(A) except in the case of an assignment to a Lender or an Affiliate of a Lender
or an assignment of the entire remaining amount of the assigning Lender’s
Commitment or Loans, the amount of the Commitment or Loans of the assigning
Lender subject to each such assignment (determined as of the trade date
specified in the Assignment and Assumption with respect to such assignment or,
if no date is so specified, as of the date the

 

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Assignment and Assumption with respect to such assignment is delivered to the
Administrative Agent) shall not be less than $5,000,000 unless each of the
Borrower and the Administrative Agent otherwise consent (such consent not to be
unreasonably withheld or delayed), provided that no such consent of the Borrower
shall be required if an Event of Default has occurred and is continuing;
(B) each partial assignment shall be made as an assignment of a proportionate
part of all the assigning Lender’s rights and obligations under this Agreement;
(C) the parties to each assignment shall execute and deliver to the
Administrative Agent an Assignment and Assumption, together with a processing
and recordation fee of $3,500, provided that assignments made pursuant to
Section 2.18(b) or Section 9.02(c) shall not require the signature of the
assigning Lender to become effective; and (D) the assignee, if it shall not be a
Lender, shall deliver to the Administrative Agent any Tax forms required by
Section 2.16(f) and an Administrative Questionnaire in which the assignee
designates one or more credit contacts to whom all syndicate-level information
(which may contain material non-public information about the Loan Parties and
their Related Parties or their respective securities) will be made available and
who may receive such information in accordance with the assignee’s compliance
procedures and applicable laws, including Federal and state securities laws.
For purposes of paragraph (b) of this Section, the term “Approved Fund” and
“CLO” have the following meanings:
“Approved Fund” means (a) a CLO and (b) with respect to any Lender that is a
fund that invests in bank loans and similar extensions of credit, any other fund
that invests in bank loans and similar extensions of credit and is managed by
the same investment advisor as such Lender or by an Affiliate of such investment
advisor.
“CLO” means an entity (whether a corporation, partnership, trust or otherwise)
that is engaged in making, purchasing, holding or otherwise investing in bank
loans and similar extensions of credit in the ordinary course of its business
and is administered or managed by a Lender or an Affiliate of such Lender.
(iii) Subject to acceptance and recording thereof pursuant to paragraph (b)(iv)
of this Section, from and after the effective date specified in each Assignment
and Assumption the assignee thereunder shall be a party hereto and, to the
extent of the interest assigned by such Assignment and Assumption, have the
rights and obligations of a Lender under this Agreement, and the assigning
Lender thereunder shall, to the extent of the interest assigned by such
Assignment and Assumption, be released from its obligations under this Agreement
(and, in the case of an Assignment and Assumption covering all of the assigning
Lender’s rights and obligations under this Agreement, such Lender shall cease to
be a party hereto but shall continue to be entitled to the benefits of
Sections 2.14, 2.15, 2.16 and 9.03) and to any fees payable hereunder that have
accrued for such Lender’s account but have not yet been paid Any assignment or
transfer by a Lender of rights or obligations under this Agreement that does not
comply with this Section 9.04 shall be treated for purposes of this Agreement as
a sale by such Lender of a participation in such rights and obligations in
accordance with paragraph (c) of this Section.
(iv) The Administrative Agent, acting for this purpose as an agent of the
Borrower, shall maintain at one of its offices a copy of each Assignment and
Assumption delivered to it and a register for the recordation of the names and
addresses of the Lenders, and the Commitment of, and principal amount of the
Loans and LC Disbursements owing to, each Lender pursuant to the terms hereof
from time to time (the “Register”). The entries in the Register shall be
conclusive, and the Borrower, the Administrative Agent, the Issuing Bank and the
Lenders shall treat each Person whose name is recorded in the Register pursuant
to the terms hereof as a Lender hereunder for all purposes of this Agreement,
notwithstanding notice to the contrary. The Register shall be available for
inspection by the Borrower, the Issuing Bank and any Lender, at any reasonable
time and from time to time upon reasonable prior notice.

 

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(v) Upon its receipt of a duly completed Assignment and Assumption executed by
an assigning Lender and an assignee, the assignee’s completed Administrative
Questionnaire and any Tax forms required by Section 2.16(f) (unless the assignee
shall already be a Lender hereunder), the processing and recordation fee
referred to in paragraph (b) of this Section and any written consent to such
assignment required by paragraph (b) of this Section, the Administrative Agent
shall accept such Assignment and Assumption and record the information contained
therein in the Register. No assignment shall be effective for purposes of this
Agreement unless it has been recorded in the Register as provided in this
paragraph.
(vi) 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.
(c) (i) Any Lender may, without the consent of the Borrower, the Administrative
Agent, the Issuing Bank or the Swingline Lender, sell participations to one or
more banks or other entities (a “Participant”) in all or a portion of such
Lender’s rights and obligations under this Agreement (including all or a portion
of its Commitment and the Loans owing to it), provided that (A) such Lender’s
obligations under this Agreement shall remain unchanged, (B) such Lender shall
remain solely responsible to the other parties hereto for the performance of
such obligations and (C) the Borrower, the Administrative Agent, the Issuing
Bank and the other Lenders shall continue to deal solely and directly with such
Lender in connection with such Lender’s rights and obligations under this
Agreement.
(ii) 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 the Loan Documents and to approve any amendment, modification or waiver
of any provision of the Loan Documents, provided that such agreement or
instrument may provide that such Lender will not, without the consent of the
Participant, agree to any amendment, modification or waiver described in the
first proviso to Section 9.02(b) that affects such Participant. Subject to
paragraph (c)(iii) of this Section, the Borrower agrees that each Participant
shall be entitled to the benefits of Sections 2.14, 2.15 and 2.16 (subject to
the requirements and limitations therein) to the same extent as if it were a
Lender and had acquired its interest by assignment pursuant to paragraph (b) of
this Section, provided that such Participant shall be subject to Section 2.18 as
though it were a Lender. To the extent permitted by law, each Participant also
shall be entitled to the benefits of Section 9.08 as though it were a Lender,
provided that such Participant shall be subject to Section 2.17(d) as though it
were a Lender.
(iii) A Participant shall not be entitled to receive any greater payment under
Section 2.14, 2.15 or 2.16 than the applicable Lender would have been entitled
to receive with respect to the participation sold to such Participant, unless
the sale of the participation to such Participant is made with the Borrower’s
prior written consent. A Participant that would be a Foreign Lender if it were a
Lender shall not be entitled to the benefits of Section 2.16 unless the Borrower
is notified of the participation sold to such Participant and such Participant
complies with Section 2.16(f) as though it were a Lender.

 

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(d) Any Lender may at any time, without the consent of the Borrower or the
Administrative Agent, pledge or assign a security interest in all or any portion
of its rights under this Agreement to secure obligations of such Lender,
including any pledge or assignment to secure obligations to a Federal Reserve
Bank, and this Section shall not apply to any such pledge or assignment of a
security interest, provided that no such pledge or assignment of a security
interest shall release a Lender from any of its obligations hereunder or
substitute any such pledgee or assignee for such Lender as a party hereto.
(e) Notwithstanding anything to the contrary contained herein, any Lender (a
“Granting Lender”) may grant to a special purpose funding vehicle (an “SPV”),
identified as such in writing from time to time by the Granting Lender to the
Administrative Agent and the Borrower, the option to provide to the Borrower all
or any part of any Loan that such Granting Lender would otherwise be obligated
to make to the Borrower pursuant to this Agreement, provided that (i) nothing
herein shall constitute a commitment by any SPV to make any Loan and (ii) if an
SPV elects not to exercise such option or otherwise fails to provide all or any
part of such Loan, the Granting Lender shall be obligated to make such Loan
pursuant to the terms hereof. The making of a Loan by an SPV hereunder shall
utilize the Commitment of the Granting Lender to the same extent, and as if,
such Loan were made by such Granting Lender. Each party hereto hereby agrees
that no SPV shall be liable for any indemnity or similar payment obligation
under this Agreement (all liability for which is hereby assumed by and shall
remain with the Granting Lender). In furtherance of the foregoing, each party
hereto hereby agrees (which agreement shall survive the termination of this
Agreement) that, prior to the date that is one year and one day after the
payment in full of all outstanding commercial paper or other senior indebtedness
of any SPV, such party will not institute against, or join any other person in
instituting against, such SPV any bankruptcy, reorganization, arrangement,
insolvency or liquidation proceedings under the laws of the U.S. or any State
thereof. In addition, notwithstanding anything to the contrary contained in this
Section 9.04, any SPV may (i) with notice to, but without the prior written
consent of, the Borrower and the Administrative Agent and without paying any
processing fee therefor, assign all or a portion of its interests in any Loans
to the Granting Lender or to any financial institutions (consented to by the
Borrower and Administrative Agent) providing liquidity or credit support to or
for the account of such SPV to support the funding or maintenance of Loans and
(ii) disclose on a confidential basis any non-public information relating to its
Loans to any rating agency, commercial paper dealer or provider of any surety,
guarantee or credit or liquidity enhancement to such SPV.
SECTION 9.05. Survival. All covenants, agreements, representations and
warranties made by the Borrower and the Loan Parties in the Loan Documents and
in the certificates or other instruments delivered in connection with or
pursuant to this Agreement or any other Loan Document shall be considered to
have been relied upon by the other parties hereto and shall survive the
execution and delivery of the Loan Documents and the making of any Loans and the
issuance of any Letters of Credit, regardless of any investigation made by any
such other party or on its behalf and notwithstanding that the Administrative
Agent, the Issuing Bank or any Lender may have had notice or knowledge of any
Default or incorrect representation or warranty at the time any credit is
extended hereunder, and shall continue in full force and effect as long as the
principal of or any accrued interest on any Loan or any fee or any other
Obligation (as distinguished from the Secured Obligations) under this Agreement
is outstanding and unpaid or any Letter of Credit is outstanding and so long as
the Revolving Commitments have not expired or terminated. The provisions of
Sections 2.14, 2.15, 2.16 and 9.03 and Article VIII shall survive and remain in
full force and effect regardless of the consummation of the transactions
contemplated hereby, the repayment of the Loans, the expiration or termination
of the Letters of Credit and the Commitments or the termination of this
Agreement or any provision hereof.

 

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SECTION 9.06. Counterparts; Integration; Effectiveness. This Agreement may be
executed in counterparts (and by different parties hereto on different
counterparts), each of which shall constitute an original, but all of which when
taken together shall constitute a single contract. This Agreement, the other
Loan Documents and any separate letter agreements with respect to fees payable
to the Administrative Agent or the syndication of the Loans and Commitments
constitute the entire contract among the parties relating to the subject matter
hereof and supersede any and all previous agreements and understandings, oral or
written, relating to the subject matter hereof. Except as provided in
Section 4.01, this Agreement shall become effective when it shall have been
executed by the Administrative Agent and when the Administrative Agent shall
have received counterparts hereof that, when taken together, bear the signatures
of each of the other parties hereto, and thereafter shall be binding upon and
inure to the benefit of the parties hereto and their respective successors and
assigns. Delivery of an executed counterpart of a signature page of this
Agreement by telecopy or by Adobe pdf file shall be effective as delivery of a
manually executed counterpart of this Agreement.
SECTION 9.07. Severability. Any provision of this Agreement held to be invalid,
illegal or unenforceable in any jurisdiction shall, as to such jurisdiction, be
ineffective to the extent of such invalidity, illegality or unenforceability
without affecting the validity, legality and enforceability of the remaining
provisions hereof; and the invalidity of a particular provision in a particular
jurisdiction shall not invalidate such provision in any other jurisdiction.
SECTION 9.08. Right of Setoff. If an Event of Default shall have occurred and be
continuing, each Lender, the Issuing Bank and each of their respective
Affiliates is hereby authorized at any time and from time to time, to the
fullest extent permitted by law, to set off and apply any and all deposits
(general or special, time or demand, provisional or final, in whatever currency)
at any time held and other obligations (in whatever currency) at any time owing
by such Lender, the Issuing Bank or any such Affiliate to or for the credit or
the account of the Borrower against any of and all the obligations of the
Borrower now or hereafter existing under this Agreement held by such Lender or
the Issuing Bank, irrespective of whether or not such Lender or the Issuing Bank
shall have made any demand under this Agreement and although such obligations
may be unmatured or are owed to a branch or office of such Lender or the Issuing
Bank different from the branch or office holding such deposit or obligated on
such Indebtedness. The applicable Lender and the Issuing Bank shall notify the
Borrower and the Administrative Agent of such setoff and application, provided
that any failure to give or any delay in giving such notice shall not affect the
validity of any such setoff and application under this Section. The rights of
each Lender, the Issuing Bank and their respective Affiliates under this Section
are in addition to other rights and remedies (including other rights of setoff)
that such Lender, the Issuing Bank and their respective Affiliates may have.
SECTION 9.09. Governing Law; Jurisdiction; Consent to Service of Process.
(a) This Agreement shall be construed in accordance with and governed by the law
of the State of New York.
(b) Each party hereto hereby irrevocably and unconditionally submits, for itself
and its property, to the exclusive jurisdiction of the Supreme Court of the
State of New York sitting in New York County and of the U.S. District Court of
the Southern District of New York, and any appellate court from any thereof, in
any action or proceeding arising out of or relating to any Loan Document, or for
recognition or enforcement of any judgment, and each of the parties hereto
hereby irrevocably and unconditionally agrees that all claims in respect of any
such action or proceeding may be heard and determined in such New York State or,
to the extent permitted by law, in such Federal court. Each of the parties
hereto agrees that a final judgment in any such action or proceeding shall be
conclusive and may be enforced in other jurisdictions by suit on the judgment or
in any other manner provided by law.

 

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(c) Each party hereto hereby irrevocably and unconditionally waives, to the
fullest extent it may legally and effectively do so, any objection that it may
now or hereafter have to the laying of venue of any suit, action or proceeding
arising out of or relating to any Loan Document in any court referred to in
paragraph (b) of this Section. Each of the parties hereto hereby irrevocably
waives, to the fullest extent permitted by law, the defense of an inconvenient
forum to the maintenance of such action or proceeding in any such court.
(d) Each party to this Agreement irrevocably consents to service of process in
the manner provided for notices in Section 9.01. Nothing in any Loan Document
will affect the right of any party to this Agreement to serve process in any
other manner permitted by law.
SECTION 9.10. WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY WAIVES, TO THE
FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY
JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING
TO ANY LOAN DOCUMENT OR THE TRANSACTIONS CONTEMPLATED THEREBY (WHETHER BASED ON
CONTRACT, TORT OR ANY OTHER THEORY). EACH PARTY HERETO (A) CERTIFIES THAT NO
REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY
OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK
TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER
PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER
THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.
SECTION 9.11. Headings. Article and Section headings and the Table of Contents
used herein are for convenience of reference only, are not part of this
Agreement and shall not affect the construction of, or be taken into
consideration in interpreting, this Agreement.
SECTION 9.12. Confidentiality. Each of the Administrative Agent, the Issuing
Bank and the Lenders agrees to maintain the confidentiality of the Information
(as defined below), except that Information may be disclosed (a) to its and its
Affiliates’ directors, officers, employees and agents, including accountants,
legal counsel and other advisors (it being understood that the Persons to whom
such disclosure is made will be informed of the confidential nature of such
Information and instructed to keep such Information confidential), (b) to the
extent requested by any regulatory authority, (c) to the extent required by
applicable laws or regulations or by any subpoena or similar legal process,
(d) to any other party to this Agreement, (e) in connection with the exercise of
any remedies hereunder or any suit, action or proceeding relating to any Loan
Document or the enforcement of rights 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
Agreement relating to the Loan Parties and their obligations under the Loan
Documents, (g) with the consent of the Borrower or (h) to the extent such
Information (i) becomes publicly available other than as a result of a breach of
this Section or (ii) becomes available to the Administrative Agent, the Issuing
Bank or any Lender on a nonconfidential basis from a source other than a Loan
Party. For the purposes of this Section, “Information” means all information
received from a Loan Party and/or its Related Parties or representatives
relating to any Loan Party, its Subsidiaries or their respective businesses,
other than any such information that is available to the Administrative Agent,
the Issuing Bank or any Lender on a nonconfidential basis prior to disclosure by
any Loan Party and/or its Related Parties or representatives, provided that, in
the case of information received from the Borrower and/or its Related Parties or
any Subsidiary after the Restatement Effective Date, such information is clearly
identified at the time of delivery as confidential. Any Person required to
maintain the confidentiality of Information as provided in this Section shall be
considered to have complied with its obligation to do so if such Person has
exercised the same degree of care to maintain the confidentiality of such
Information as such Person would accord to its own confidential information.

 

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(b) Each Lender acknowledges that information as defined in Section 9.12(a)
furnished to it pursuant to this Agreement may include material non-public
Information concerning the Loan Parties and their Related Parties or their
respective securities, and confirms that it has developed compliance procedures
regarding the use of material non-public Information and that it will handle
such material non-public Information in accordance with those procedures,
applicable law, including Federal and state securities laws, and the terms
hereof.
(c) All information, including waivers and amendments, furnished by the Loan
Parties, their Related Parties or representatives or the Administrative Agent
pursuant to, or in the course of administering, this Agreement will be
syndicate-level information, which may contain material non-public Information
about the Loan Parties and their Related Parties or their respective securities
and its securities. Accordingly, each Lender represents to the Borrower (on
behalf of the Loan Parties) and the Administrative Agent that it has identified
in its Administrative Questionnaire a credit contact who may receive Information
that may contain material non-public Information in accordance with its
compliance procedures, applicable law and the terms hereof.
SECTION 9.13. USA PATRIOT Act. Each Lender that is subject to the requirements
of the USA Patriot Act (Title III of Pub. L. 107-56 (signed into law October 26,
2001)) (the “Act”) hereby notifies the Borrower that pursuant to the
requirements of the Act, it is required to obtain, verify and record information
that identifies the Loan Parties, which information includes the names and
addresses of the Loan Parties and other information that will allow such Lender
to identify the Borrower in accordance with the Act.
SECTION 9.14. Disclosure. The Borrower and each Lender hereby acknowledges and
agrees that the Administrative Agent and/or its Affiliates from time to time may
hold investments in, make other loans to or have other relationships with any of
the Loan Parties and their respective Affiliates.
SECTION 9.15. Appointment for Perfection. Each Lender hereby appoints each other
Lender as its agent for the purpose of perfecting Liens, for the benefit of the
Administrative Agent and the Lenders, in assets which, in accordance with
Article 9 of the UCC or any other applicable law, can be perfected only by
possession. Should any Lender (other than the Lender serving hereunder as the
Administrative Agent) obtain possession of any such Collateral, such Lender
shall notify the Administrative Agent thereof, and, promptly upon the
Administrative Agent’s request therefor shall deliver such Collateral to the
Administrative Agent or otherwise deal with such Collateral in accordance with
the Administrative Agent’s instructions.
SECTION 9.16. Interest Rate Limitation. Notwithstanding anything herein to the
contrary, if at any time the interest rate applicable to any Loan or
participation in any LC Disbursement, together with all fees, charges and other
amounts that are treated as interest on such Loan or LC Disbursement or
participation therein under applicable law (collectively the “Charges”), shall
exceed the maximum lawful rate (the “Maximum Rate”) that may be contracted for,
charged, taken, received or reserved by the Lender holding such Loan or LC
Disbursement or participation therein in accordance with applicable law, the
rate of interest payable in respect of such Loan or LC Disbursement or
participation therein hereunder, together with all Charges payable in respect
thereof, shall be limited to the Maximum Rate and, to the extent lawful, the
interest and Charges that would have been payable in respect of such Loan or LC
Disbursement or participation therein but were not payable as a result of the
operation of this Section shall be cumulated and the interest and Charges
payable to such Lender in respect of other Loans or LC Disbursements or
participation therein or periods shall be increased (but not above the Maximum
Rate therefor) until such cumulated amount, together with interest thereon at
the Federal Funds Effective Rate to the date of repayment, shall have been
received by such Lender.

 

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SECTION 9.17. Existing Credit Agreement; Effectiveness of Amendment and
Restatement. Until this Agreement becomes effective in accordance with the terms
of the Amendment and Restatement Agreement, the Existing Credit Agreement shall
remain in full force and effect and shall not be affected hereby. After the
Restatement Effective Date, all obligations of the Borrower under the Existing
Credit Agreement shall become obligations of the Borrower hereunder and the
provisions of the Existing Credit Agreement shall be superseded by the
provisions hereof.
SECTION 9.18. No Fiduciary Relationship. The Borrower, on behalf of itself and
the Subsidiaries, agrees that in connection with all aspects of the transactions
contemplated hereby and any communications in connection therewith, the
Borrower, the Subsidiaries and their respective Affiliates, on the one hand, and
the Administrative Agent, the Lenders and their respective Affiliates, on the
other hand, will have a business relationship that does not create, by
implication or otherwise, any fiduciary duty on the part of the Administrative
Agent, the Lenders or their respective Affiliates, and no such duty will be
deemed to have arisen in connection with any such transactions and
communications.

 

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SCHEDULE 1.01(a)
USG CORPORATION
STATEMENT OF INVESTMENT OBJECTIVE AND GUIDELINES
(see following attached pages)

 

 

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(USG LOGO) [c10185c1018500.gif]
Investment Policy
Dated: November 5, 2010
Scope
This policy shall apply to USG Corporation and the corporate cash managed by
internal treasury staff of USG Corporation as well as external managers that are
utilized. This policy does not cover cash managed by foreign entities, pension
assets or the 401K plan. All investments covered under this policy will be
purchased in U.S. dollars.
USG Corporate cash will be segmented into two categories based in the different
characteristics of each and the business needs. As the cash levels change, the
segmentation strategy may be updated.
Tier I: Operating Cash: Cash balances, overnight sweep investments and
short-term investments that are held for working capital and daily operating
needs. This segment of cash requires preservation of principal, late-day access
and liquidity.
Tier II: Reserve Cash: Excess cash that is not required for operating cash and
set aside for specific purposes such as the $300 million maturity of the Senior
Notes on August 1, 2014.
Investment Objectives
The investment objectives of this policy are, in priority order:

  •  
Maintain safety and preservation of principal through a well-diversified
portfolio of high-grade fixed income securities.

  •  
Provide sufficient liquidity of investments to meet projected operating cash
requirements.

  •  
Deliver yields in excess of selected benchmarks, in relationship to the
guidelines and tax considerations. At the time of the inception of this
Investment Policy, USG Corporation is not a current taxpaying entity.

Roles and Responsibilities

  •  
The CFO and Treasurer are authorized to approve and amend the investment policy.

  •  
The Assistant Treasurer and his/her staff are responsible for executing the
policy.

  •  
Tier I cash is managed by the treasury staff at the Corporate Headquarters and
Tier II cash is managed by outside investment managers.

Investment Parameters
Specific eligible securities for U.S. cash Investments— see Appendix 1
Credit Rating Requirements1
Investments must be rated by at least one of the three following credit rating
agencies at the time of purchase: if rated by more than one agency the lowest
rating shall prevail.
Moody’s Investors Service
 

      1  
Excludes Money Market Mutual Funds

 

 

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Average Credit Quality
The minimum average credit quality for each tier of the investment portfolio at
the individual portfolio level must maintain a weighted rating of “AA-“ or
higher. The weighted average quality will be calculated by using mapping tables
for each rating agency that assign numerical values for each credit. Then the
weighted average of those numbers (based on % market value) will be applied to
get the average credit rating on the portfolio. In the case of a security being
rated by more than one agency, the lowest rating shall prevail.
Security Downgrade
In the event a security in the portfolio is downgraded below the minimum credit
quality allowed for the category, the external investment manager and/or
Treasury personnel responsible for the internal management of the corporate cash
will contact the Assistant Treasurer as soon as possible. A plan of action will
be determined in a reasonable time. It is not mandatory that the security must
be sold. However, if the decision is made to hold the investment, the reason for
the decision must be documented.
Realized Gains/Losses
USG Corporation will instill no restriction on gains earned from investments
managed in house or by an external manager. For each quarter, the portfolio must
adhere to a zero realized net loss policy (excluding realized losses from
securities sold due to a credit downgrade).
Duration Limit
Portfolios managed by an external manager must maintain a weighted average
duration not to exceed 1 year.
Benchmark
Tier I: The iMoneyNet First Tier Institutional Index will be used as the
benchmark for the operating cash.
Tier II: The ML 3 month Treasury Bill Index will be the benchmark for the
reserve cash. Ticker: <GO01>
Reporting and Evaluation and Compliance
The external investment manager(s) must communicate regularly with the Treasurer
and Assistant Treasurer, with formal meetings at least annually. The investment
manager(s) must provide detailed monthly reporting on each investment portfolio.
Electronic reporting should be provided in a timely manner consistent with the
Company’s calendar and cutoff dates provided by the Assistant Treasurer. The
portfolio’s performance and risk profile is to be reported on a monthly,
quarterly and annual basis. These reports should support accounting
classifications such as “Available for Sale”, performance of the portfolio and
should at least include:

  *  
Total securities held in the portfolio, including maturity date, coupon rate and
current yield to maturity
    *  
Mark to market valuations
    *  
Liquidity/cash flow schedule
    *  
Portfolio value
    *  
Investment income
    *  
Performance figures
    *  
Comparisons to the selected benchmark index
    *  
Realized gains/losses
    *  
Portfolio risk profile

Finally, the investment manager(s) should provide a certification of compliance
with the stated investment policy and a related report that explains any
exceptions.

 

 

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Appendix 1
USG Corporation — Tier I: Operating Cash
INVESTMENT POLICY

                      MINIMUM   MAXIMUM   MAXIMUM   MAXIMUM SECURITY TYPE  
CREDIT RATING   MATURITY   PORTFOLIO EXPOSURE   ISSUER EXPOSURE
Obligations of :US Treasury,
  Aaa/AAA   6 Months   100%   N/A
Government & Agency Securities
Includes: US Treasury Bills, Notes & Bonds, Agency and GSE securities
               
Commercial Paper
  A-1/P-1   90 days   30%   5%
Money Market Mutual Funds2
  Stable NAV, 2a-7   Daily   100%   Our exposure cannot
Includes: Taxable & Tax-exempt
  compliant           be greater than 5%
 
              of total assets of
 
              the money market
 
              fund*
Certificates of Deposit
  A-1/P-1   6 Months   30%   5%
Includes: (Domestic, Eurodollar, and Yankee), Eurodollar Deposits, Time Deposits
               
Obligations of Foreign Governments
  AAA/Aaa   6 Months   50%   5%
and Supranational Organizations
               

      •   Note: Securities issued under rule 144A or other private placements
are eligible

 

      *   At no time may the total investment in any single Money Market Mutual
Fund exceed $100MM.

      2   Due diligence review will be conducted on Money Market Fund providers.
See Appendix 2.

 

 

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USG Corporation —Tier II: Reserve Cash
INVESTMENT POLICY

                      MINIMUM   MAXIMUM   MAXIMUM   MAXIMUM SECURITY TYPE  
CREDIT RATING   MATURITY   PORTFOLIO EXPOSURE   ISSUER EXPOSURE
US Treasury, Government & Agency Securities

  Aaa/AAA   3 Years   100%   N/A
Includes: US Treasury Bills, Notes & Bonds, Agency and GSE securities
               
Repurchase Agreements
  Refer to rating   7 Days   50%   25%
Collateral type: Treasuries, Agencies, Corporates
  applicable to collateral type            
Collateral margin: 102% of the face value
               
Commercial Paper
  A-1/P-1   13 Months   50%   5%
Asset Backed Commercial Paper
  A-1/P-1   13 Months   50%   5%
Money Market Mutual Funds3
  Stable NAV, 2a-7   Daily   100%   Our exposure cannot
Includes: Taxable & Tax-exempt
  compliant           be greater than 5%
 
              of total assets of
 
              the money market
 
              fund.
Variable Rate Demand Notes
  A-1/P-1/ VMIG1   7 days   50%   5%
Includes: Taxable & Tax-exempt
               
Corporate Bonds (US & Foreign)
  A3/A-   3 Years   50%   5%
Includes: US & Foreign corporate notes, bonds & debentures, Eurodollar/Yankee
debt obligations, fixed and floating
               
Local, City, State Government & Agency Obligations
  A-1/P-1/VMIG1
BBB-/Baa3*   3 Years   50%   5%
Including but not limited to: General
          * No more than 25%    
obligation bonds, revenue bonds, non-rated
          of the portfolio    
and non-rerated pre-refunded bonds and project bonds
          in BBB-/Baa3    
Certificates of Deposit
Includes: (Domestic, Eurodollar, and Yankee), Eurodollar Deposits, Time Deposits
  A-1/P-1   2 years   50%   5%
Obligations of Foreign Governments and
  AAA/Aaa   3 years   50%   5%
Supranational Organizations
               
Credit Card and Auto Asset Backed Securities
  AAA/Aaa   13 Months*   15%   5%

 

      3   Due diligence review will be conducted on Money Market Fund providers.
See Appendix 2.

•   Minimum credit criteria is “at time of purchase”   •   Maximum issuer
exposure is “at time of purchase”   •   Maximum maturity is defined as “from
settlement date”

  •   Note: Securities issued under rule 144A or other private placements are
eligible     •   * For Asset Backed Securities Weighted Average Life (WAL) will
be used as final maturity for the purposes of duration calculation.

 

 

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Appendix 2
Money Market Fund Guidelines

  •   Fund must have at least $10B in Assets under Management(AUM). If fund is
smaller, then an exception must be approved by the Treasurer.     •   Fund must
be bank sponsored by a strong financial entity or be part of a large fund
provider.     •   The liquidity business must be a key component of the overall
business of the asset management firm.     •   Our exposure cannot be greater
than 5% of total assets of the money market fund.     •   The portfolio manager
and credit team must be accessible and available upon request.     •   Fund must
be willing to provide, holdings, and Weighted Average Maturity (WAM) at request.
    •   Fund must comply with Rule 2a(7) of the Investment Company Act

 

 

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Approved by:

                 
 
      Dated:        
 
Brian Misiunas
         
 
   
Assistant Treasurer
               
 
               
 
      Dated:        
 
Karen Leets
         
 
   
VP and Treasurer
               
 
               
 
      Dated:        
 
Richard Fleming
         
 
   
EVP and CFO
               

 

 

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Schedule 1.01 (b)
to Credit Agreement
USG Corporation
Schedule of Borrowing Base Supplemental Documentation
Documents to be Submitted to the Administrative Agent
The following information is to be submitted, pursuant to Section 5.01 of the
Credit Agreement, for USG Corporation as noted below:

                  Monthly             Reporting:   Semi-   Weekly     Due within
  Annually   Reporting:     Fifteen   (per the   Due within     (15)   terms of
the   Three (3)     Business   Credit   Business Reporting Frequency   Days  
Agreement)   Days
Borrowing Base Certificate in the form of Exhibit.
  X       X
 
           
Accounts Receivable Supporting Documents:
           
1. Accounts receivable summary aging aged by invoice date or due date, as
applicable, by operating division in an electronic format suitable to the
Administrative Agent
  X       X
2. Accounts receivable rollforward by operating division in a format suitable to
the Administrative Agent
  X       X
3. Top 10 accounts receivable balances aged per the most recent summary aging by
operating division
  X       X
4. Reconciliation of A/R aging report to the general ledger and financial
statements by operating division
  X       X
5. Top 10 Sales Concentration for Prior Twelve months by operating division
  X       X
6. Supporting documentation (system generated extract report where applicable)
for the A/R ineligibles/ reserves reported on the Borrowing Base Certificate by
operating division
  X       X
7. U.S. updated customer list by operating division
  X   X    
 
           
Inventory Supporting Documents:
           
1. An inventory perpetual report and schedules detailing each operating
division’s inventory, in a form satisfactory to the Administrative Agent, (i) by
summarized locations, (ii) by department, (iii) by volume on hand and (iv) other
schedules as reasonably requested
  X       X
2. Gross margin and turnover by product segment by operating division
  X        
3. Reconciliation of perpetual inventory reports to the general ledger and
financial statements by operating division
  X        
4. Schedule of monthly rent or unpaid fees related to leased or unowned
locations (eg: outside processors, third party warehouses or other locations for
which landlord waivers or bailee letters have not been received)
  X        
5. Inventory value stated at cost by location for each operating division
  X        
6. Supporting documentation (system generated extract report where applicable)
for the inventory ineligibles/ reserves reported on the Borrowing Base
Certificate by operating division
  X       X

 

 

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                  Monthly             Reporting:   Semi-   Weekly     Due within
  Annually   Reporting:     Fifteen   (per the   Due within     (15)   terms of
the   Three (3)     Business   Credit   Business Reporting Frequency   Days  
Agreement)   Days
Other Supporting Documents:
           
1. Accounts payable summary aging by vendor and by operating division in a
format suitable to the Administrative Agent
  X       X
2. Top 10 accounts payable vendor balances by aging category and operating
division
  X       X
3. Year-to-date top 10 purchases concentration by vendor and operating division
  X       X
4. Reconciliation of A/P aging to general ledger and financial statements per
operating division
  X       X
5. Cash and Cash Equivalents Balance
  X       X

Submit to:
JPMorgan Chase Bank, N.A.
CBC Structuring & Portfolio Group
Attn: Robert A. Kaulius
270 Park Avenue, 44th Floor
New York, NY 10017
Phone: (212) 270 - 0285
Fax: (646) 534 - 2288
E-Mail: robert.a.kaulius@jpmorgan.com

 

 

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Schedule 2.01
Commitments

              Revolving   Bank   Commitments  
 
       
JPMorgan Chase Bank, N.A.
  $ 81,565,217.39  
Bank of America, N.A.
    81,565,217.39  
Wells Fargo Bank, N.A.
    75,000,000.00  
State of California Public Employees’ Retirement System
    31,000,000.00  
Citibank, N.A.
    25,000,000.00  
U.S. Bank National Association
    25,000,000.00  
Goldman Sachs Lending Partners LLC
    25,000,000.00  
Royal Bank of Canada
    25,000,000.00  
The Northern Trust Company
    20,000,000.00  
Morgan Stanley Bank, N.A.
    10,869,565.22  
 
     
Total:
  $ 400,000,000.00  
 
     

 

 

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Schedule 3.06
Disclosed Matters
The inclusion of the following information in this Schedule 3.06 shall not
constitute an admission of liability with respect to any such matter or that any
such matter will have, or could reasonably be expected to have, a Material
Adverse Effect.
We are named as defendants in litigation arising from our operations, including
claims and lawsuits arising from the operation of our vehicles and claims
arising from product warranties, workplace or job site injuries, and general
commercial disputes. This litigation includes multiple lawsuits, including class
actions relating to Chinese-manufactured drywall distributed by L&W Supply
Corporation in the southeastern United States in 2006 and 2007. In those cases,
the plaintiffs allege that the Chinese-manufactured drywall is defective and
emits excessive sulfur compounds which have caused property damage to the homes
in which the drywall was installed and potential health hazards to the residents
of those homes.
We have also been notified by state and federal environmental protection
agencies of possible involvement as one of numerous “potentially responsible
parties” in a number of Superfund sites in the United States. As a potentially
responsible party, we may be responsible to pay for some part of the cleanup of
hazardous waste at those sites. In most of these sites, our involvement is
expected to be minimal. In addition, we are involved in environmental cleanups
of other property that we own or owned.
We believe that appropriate accruals have been established for our potential
liability in connection with these matters, taking into account the probability
of liability, whether our exposure can be reasonably estimated and, if so, our
estimate of our liability or the range of our liability. However, we continue to
review these accruals as additional information becomes available and revise
them as appropriate. We do not expect the environmental matters or any other
litigation matters involving USG to have a material adverse effect upon our
results of operations, financial position or cash flows.

 

 

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Schedule 6.01
Existing Indebtedness

                  Obligor(s)     Description of Indebtedness   Amount   USG
Corporation  
Industrial Revenue Bonds
               
Ohio Air Quality Development Authority
  $ 45,000,000          
Ohio Air Quality Development Authority
  $ 44,400,000          
Ohio Air Quality Development Authority
  $ 9,000,000          
City of East Chicago, Indiana
  $ 10,000,000          
City of East Chicago, Indiana
  $ 10,000,000          
Pennsylvania Economic Development Financing Authority
  $ 110,000,000          
Oregon Economic & Community Development Commission
  $ 11,000,000   CGC, Inc.  
Windsor & Hantsport Railroad Guaranty
  CAN $7,000,000          
Secured Credit Line with Toronto Dominion
  CAN $30,000,000   USG Deutschland GmbH  
Credit Line Agreement with Postbank
  € 1,950,000          
Indebtedness of the following Joint Venture entity has been guaranteed by
indirect subsidiaries of USG Corporation
        USG Middle East Ltd. (Saudi Arabia)  
Loans of Saudi-French Bank and Saudi Industrial Development Fund, guaranteed in
proportion to equity ownership (i.e. 45%) but limited to value of investment in
USG Manufacturing Worldwide Ltd.
  $ 8,900,000  

 

 

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

 

Schedule 6.02
Existing Liens

1.  
CGC Inc.’s credit agreement with The Toronto-Dominion Bank is secured by a
general security interest in substantially all of CGC’s assets other than
intellectual property.

 

 

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

 

Schedule 6.04

Existing Investments

1.  
Beltship Management Ltd., a joint venture — 50% owned by Gypsum Transportation,
Limited
  2.  
USG Middle East, Ltd., a joint venture — 45% owned by USG Manufacturing
Worldwide, Ltd.
  3.  
Donn South Africa (PTY) Ltd., a joint venture — 33% owned by USG Interiors
International, Inc.
  4.  
Knauf/USG Systems GmbH & Co. KG, a joint venture — 50% owned by USG
Ventures-Europe GmbH.
  5.  
Knauf-USG Verwaltungs GmbH, a joint venture — 50% owned by USG Ventures-Europe
GmbH.
  6.  
Knauf USG Building Systems ABEE, LLC — 99% owned by Knauf/USG Systems GmbH & Co.
KG.
  7.  
MRC Duracrete Co., Ltd. — 10% owned by Gypsum Engineering Company.
  8.  
STAR-USG Building Materials Co., Ltd. — 50% owned by USG China Lux S.ar.l.
  9.  
Gas Natural Caxitlán, S. de R.L. de C.V. — 50% owned by USG de México, S.A. de
C.V.

 

 

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

 

Schedule 6.09
Existing Restrictions
The equity ownership of the Borrower or a Subsidiary in the following joint
venture entities is subject to provisions which either (1) provide the other
parties to the joint ventures with rights of first refusal or buy/sell rights
with respect to such equity ownership, or (2) prohibit using such equity
ownership as security for indebtedness:

1.  
Knauf/USG Systems GmbH & Co. KG and Knauf-USG Verwaltungs GmbH, its general
partner
  2.  
USG Middle East, Ltd. (Saudi Arabia)
  3.  
Donn South Africa (PTY) Ltd. (South Africa)
  4.  
MRC Duracrete Co., Ltd. (Japan)
  5.  
Beltship Management Limited (Bermuda)
  6.  
Gas Natural Caxitlán, S. de R.L. de C.V.

 

 

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

 

EXECUTION COPY
EXHIBIT A
[FORM OF]
ASSIGNMENT AND ASSUMPTION
This Assignment and Assumption (the “Assignment and Assumption”) is dated as of
the Effective Date set forth below and is entered into by and between [Insert
name of Assignor] (the “Assignor”) and [Insert name of Assignee] (the
“Assignee”). Capitalized terms used but not defined herein shall have the
meanings given to them in the Credit Agreement identified below (as amended,
supplemented or otherwise modified from time to time, the “Credit Agreement”),
receipt of a copy of which is hereby acknowledged by the Assignee. The Standard
Terms and Conditions set forth in Annex 1 attached hereto are hereby agreed to
and incorporated herein by reference and made a part of this Assignment and
Assumption as if set forth herein in full.
For an agreed consideration, the Assignor hereby irrevocably sells and assigns
to the Assignee, and the Assignee hereby irrevocably purchases and assumes from
the Assignor, subject to and in accordance with the Standard Terms and
Conditions and the Credit Agreement, as of the Effective Date inserted by the
Administrative Agent as contemplated below (i) all of the Assignor’s rights and
obligations in its capacity as a Lender under the Credit Agreement and any other
documents or instruments delivered pursuant thereto to the extent related to the
amount and percentage interest identified below of all of such outstanding
rights and obligations of the Assignor under the respective facilities
identified below (including guarantees and swingline loans included in such
facilities) and (ii) to the extent permitted to be assigned under applicable
law, all claims, suits, causes of action and any other right of the Assignor (in
its capacity as a Lender) against any Person, whether known or unknown, arising
under or in connection with the Credit Agreement, any other documents or
instruments delivered pursuant thereto or the loan transactions governed thereby
or in any way based on or related to any of the foregoing, including contract
claims, tort claims, malpractice claims, statutory claims and all other claims
at law or in equity related to the rights and obligations sold and assigned
pursuant to clause (i) above (the rights and obligations sold and assigned
pursuant to clauses (i) and (ii) above being referred to herein collectively as
the “Assigned Interest”). Such sale and assignment is without recourse to the
Assignor and, except as expressly provided in this Assignment and Assumption,
without representation or warranty by the Assignor.

         
1.
  Assignor:                                                               
 
       
2.
  Assignee:                                                               

 
      [and is an Affiliate/Approved Fund of [identify Lender]1]
 
       
3.
  Borrower:   USG Corporation, a Delaware corporation
 
       
4.
  Administrative Agent:   JPMorgan Chase Bank, N.A.

 

      1  
Select as applicable.

 

Exhibit A

 

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

 

         
5.
  Credit Agreement:  
The $400,000,000 Third Amended and Restated Credit Agreement dated as of
December [      ], 2010, among USG Corporation, a Delaware corporation, the
Lenders from time to time party thereto, JPMorgan Chase Bank, N.A., as
Administrative Agent, and Bank of America, N.A. and Wells Fargo Bank, N.A., as
co-syndication agents
 
       
6.
  Assigned Interest:    

                  Aggregate Amount of   Amount of         Commitment/Loans for
all   Commitment/Loans     Percentage Assigned of   Lenders   Assigned    
Commitment/Loans1  
$
  $           %

Effective Date: __ ___, 20_____ [TO BE INSERTED BY ADMINISTRATIVE AGENT AND
WHICH SHALL BE THE EFFECTIVE DATE OF RECORDATION OF TRANSFER IN THE REGISTER
THEREFOR.]
The Assignee agrees to deliver to the Administrative Agent a completed
Administrative Questionnaire in which the Assignee designates one or more credit
contacts to whom all syndicate-level information (which may contain material
non-public information about the Parent Borrower, the Loan Parties and their
Related Parties or their respective securities) will be made available and who
may receive such information in accordance with the Assignee’s compliance
procedures and applicable laws, including U.S. Federal and State securities
laws.
The terms set forth in this Assignment and Assumption are hereby agreed to:

            ASSIGNOR

[NAME OF ASSIGNOR]
      By:           Name:           Title:        

 

      1  
Set forth, to at least 9 decimals, as a percentage of the Commitment/Loans of
all Lenders thereunder.

Exhibit A

 

2

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

 

            ASSIGNEE

[NAME OF ASSIGNEE]
      By:           Name:           Title:      

Exhibit A

 

3

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

 

          Consented to and Accepted:    
 
        JPMORGAN CHASE BANK, N.A., as
Administrative Agent    
 
       
By 
       
 
 
 
Name:    
 
  Title:    
 
        [Consented to:    
 
        USG CORPORATION    
 
       
By 
       
 
 
 
Name:    
 
  Title:]2    

 

      2   To the extent required pursuant to Section 9.04(b)(i) of the Credit
Agreement.

Exhibit A

 

4

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

 

ANNEX 1
STANDARD TERMS AND CONDITIONS FOR
ASSIGNMENT AND ASSUMPTION
1. Representations and Warranties.
1.1 Assignor. The Assignor (a) represents and warrants that (i) it is the legal
and beneficial owner of the Assigned Interest, (ii) the Assigned Interest is
free and clear of any lien, encumbrance or other adverse claim and (iii) it has
full power and authority, and has taken all action necessary, to execute and
deliver this Assignment and Assumption and to consummate the transactions
contemplated hereby; and (b) assumes no responsibility with respect to (i) any
statements, warranties or representations made in or in connection with the
Credit Agreement or any other Loan Document, (ii) the execution, legality,
validity, enforceability, genuineness, sufficiency or value of the Loan
Documents or any collateral thereunder, (iii) the financial condition of the
Borrower, any of their Subsidiaries or Affiliates or any other Person obligated
in respect of any Loan Document or (iv) the performance or observance by the
Borrower, any of its Subsidiaries or Affiliates or any other Person of any of
their respective obligations under any Loan Document.
1.2. Assignee. The Assignee (a) represents and warrants that (i) it has full
power and authority, and has taken all action necessary, to execute and deliver
this Assignment and Assumption and to consummate the transactions contemplated
hereby and to become a Lender under the Credit Agreement, (ii) it satisfies the
requirements, if any, specified in the Credit Agreement that are required to be
satisfied by it in order to acquire the Assigned Interest and become a Lender,
(iii) from and after the Effective Date, it shall be bound by the provisions of
the Credit Agreement as a Lender thereunder and, to the extent of the Assigned
Interest, shall have the obligations of a Lender thereunder, (iv) it has
received a copy of the Credit Agreement, together with copies of the most recent
financial statements delivered pursuant to Section 5.01 thereof, as applicable,
and such other documents and information as it has deemed appropriate to make
its own credit analysis and decision to enter into this Assignment and
Assumption and to purchase the Assigned Interest on the basis of which it has
made such analysis and decision independently and without reliance on the
Administrative Agent or any other Lender, and (v) if it is a Foreign Lender,
attached to this Assignment and Assumption is any documentation required to be
delivered by it pursuant to the terms of the Credit Agreement, duly completed
and executed by the Assignee; and (b) agrees that (i) it will, independently and
without reliance on the Administrative Agent, the Assignor or any other Lender,
and based on such documents and information as it shall deem appropriate at the
time, continue to make its own credit decisions in taking or not taking action
under the Loan Documents, and (ii) it will perform in accordance with their
terms all of the obligations which by the terms of the Loan Documents are
required to be performed by it as a Lender.
Exhibit A

 

 

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

 

2. Payments. From and after the Effective Date, the Administrative Agent shall
make all payments in respect of the Assigned Interest (including payments of
principal, interest, fees and other amounts) to the Assignor for amounts which
have accrued to but excluding the Effective Date and to the Assignee for amounts
which have accrued from and after the Effective Date.
3. General Provisions. This Assignment and Assumption shall be binding upon, and
inure to the benefit of, the parties hereto and their respective successors and
assigns. This Assignment and Assumption may be executed in any number of
counterparts, which together shall constitute one instrument. Delivery of an
executed counterpart of a signature page of this Assignment and Assumption by
telecopy shall be effective as delivery of a manually executed counterpart of
this Assignment and Assumption. This Assignment and Assumption shall be governed
by, and construed in accordance with, the law of the State of New York.
Exhibit A

 

 

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

 

EXHIBIT B
USG CORPORATION
[FORM OF]
BORROWING BASE CERTIFICATE
For the period ended ______________ (in $000’s)

                        A.    
Available Accounts Receivable (page 2 of 3 )
  $ —                
 
                B.    
Available Raw Materials (page 3 of 3 )
  $ —                
 
                C.    
Available Work-In-Process (page 3 of 3)
  $ —                
 
                D.    
Available Finished Goods (page 3 of 3 )
  $ —                
 
                E.    
Less Reserves:
                     
Rent Reserve and Reserves for Bailee’s Charges
    —                
Other Reserves (per terms of Credit Agreement)
    —                
 
                   
 
                F.    
Borrowing Base (lines A+B+C+D-E)
          $ —        
 
                   
 
                G.    
Lower of:
                     
(i) Borrowing Base
  $ —                
(ii) Revolving Commitment
  $ —     $ —        
 
                 
 
                H.    
Revolving Exposure:
                     
Aggregate principal amount of Loans outstanding:
                     
LC Exposure Outstanding
                     
Swingline Exposure Outstanding
                     
Total Revolving Exposure
          $ —        
 
                   
 
                I.    
Excess Availability (lines G-H)
          $ —        
 
             

Officer’s Certification:
Pursuant to the Third Amended and Restated Credit Agreement dated as of December
[*], 2010, the undersigned Financial Officer of USG Corporation certifies that
the information provided in this certificate to JPMorgan Chase Bank, N.A. as
Administrative Agent, is true and correct based on the accounting records of USG
Corporation.
USG Corporation

         
 
Name
 
 
Date    
Title
       

 

Page 1 of 4

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

 

EXHIBIT B
USG CORPORTATION
[FORM OF]
BORROWING BASE CERTIFICATE
For the period ended ______________ (in $000’s)

                                      Gypsum     Interiors     L&W    
Consolidated  
 
                               
Net Aging Balance
  $ —     $ —     $ —     $ —  
 
             
Addback: General Accrual Reserves included in Aging
    —       —       —       —  
 
                       
 
             
Total Aging Balance (including Accrual Reserves)
  $ —     $ —     $ —     $ —  
 
                               
Less ineligibles:
                               
Affiliate Receivables
    —       —       —       —  
 
                               
Concentration Limit 15% (20% if investment rated)
    —       —       —       —  
Defaulted Receivables
    —       —       —       —  
 
                               
Deductions
    —       —       —       —  
 
                               
Foreign Obligors
    —       —       —       —  
 
                               
Payment Terms Greater than 60 Days
    —       —       —       —  
 
                               
Rebate Accrual Amount
    —       —       —       —  
 
                               
Credits Greater than 30 days past due, 90 days past invoice
    —       —       —       —  
 
                               
Cross-Aged Receivables (50%)
    —       —       —       —  
 
                               
Obligors with Cash in Advance terms
    —       —       —       —  
 
                               
Accrued Sales & Use Taxes
    —       —       —       —  
 
                               
Unbilled receivables
    —       —       —       —  
 
                               
A/R Reconciliation Items
    —       —       —       —  
 
                               
Notes Receivable
    —       —       —       —  
 
                               
Receivables Subject to Offset or Claim
    —       —       —       —  
 
                               
A/R not Denominated / Payable in USD
    —       —       —       —  
 
                               
Government Receivables
    —       —       —       —  
 
                               
Bankrupt Obligors
    —       —       —       —  
 
                               
Bill and hold receivables
    —       —       —       —  
 
                               
Progress billing receivables
    —       —       —       —  
 
                               
Other (per terms of Credit Agreement)
    —       —       —       —  
 
                       
 
                               
Total ineligibles:
  $ —     $ —     $ —     $ —  
 
                               
Eligible Accounts Receivable before dilution reserve
  $ —     $ —     $ —     $ —  
 
                               
Dilution Percentage (>5%)
                               
Dilution Reserve $
  $ —     $ —     $ —     $ —  
 
                             

Exhibit C

Page 2 of 4

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EXHIBIT B
USG CORPORTATION
[FORM OF]
BORROWING BASE CERTIFICATE
For the period ended ______________ (in $000’s)

                                      Gypsum     Interiors     L&W    
Consolidated  
Raw Materials Inventory
                               
 
                               
Raw Materials Per Perpetual
  $ —     $ —     $ —     $ —  
 
                               
Less Ineligibles and Inventory Reserves:
                               
Spare parts, packaging, supplies
    —       —       —       —  
 
                               
Damaged, defective, return to vendor, discontinued, nonsalable
    —       —       —       —  
Inventory locations <$100,000 (b)
    —       —       —       —  
 
                               
Subject to consignment
    —       —       —       —  
 
                               
Detonators & Explosives
    —       —       —       —  
 
                               
Items without assigned product class
    —       —       —       —  
 
                               
Intercompany profits included in inventory
    —       —       —       —  
 
                               
Re-stocking and delivery fees included in inventory
    —       —       —       —  
Testing prototypes display items
    —       —       —       —  
 
                               
Shrink reserve (a)
    —       —       —       —  
 
                               
Slow moving and obsolete reserve
    —       —       —       —  
Lower of cost or market reserve
    —       —       —       —  
 
                               
Capitalized favorable variances
    —       —       —       —  
 
                               
Vendor rebate reserve
    —       —       —       —  
Other (per terms of the Credit Agreement)
    —       —       —       —  
 
                       
 
                               
Total Ineligible
    —       —       —       —  
 
                       
 
             
Eligible Raw Materials
    —       —       —       —  
 
             
Lesser of:
                               
 
                               
(i) Advance Rate
    60.0 %     60.0 %     60.0 %        
NOLV %
                               
(ii) 85% of Net Orderly Liquidation Rate
    0.0 %     0.0 %     0.0 %        
 
                       
 
                               
Available Raw Materials
  $ —     $ —     $ —     $ —  
 
                       
 
                               
Work In Process Inventory
                               
 
                               
Work In Process Per Perpetual
  $ —     $ —     $ —     $ —  
 
                               
Less Ineligibles and Inventory Reserves:
                               
Spare parts, packaging, supplies
    —       —       —       —  
 
                               
Damaged, defective, return to vendor, discontinued, nonsalable
    —       —       —       —  
Inventory locations <$100,000 (b)
    —       —       —       —  
 
                               
Detonators & Explosives
    —       —       —       —  
 
                               
Items without assigned product class
    —       —       —       —  
 
                               
Intercompany profits included in inventory
    —       —       —       —  
 
                               
Re-stocking and delivery fees included in inventory
    —       —       —       —  
Testing prototypes display items
    —       —       —       —  
 
                               
Shrink reserve (a)
    —       —       —       —  
 
                               
Slow moving and obsolete reserve
    —       —       —       —  
Lower of cost or market reserve
    —       —       —       —  
 
                               
Capitalized favorable variances
    —       —       —       —  
 
                               
Vendor rebate reserve
    —       —       —       —  
 
                               
Other (per terms of the Credit Agreement)
    —       —       —       —  
 
                       
 
                               
Total Ineligibles
    —       —       —       —  
 
                       

Exhibit C

Page 3 of 4

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

 

                                      Gypsum     Interiors     L&W    
Consolidated  
Eligible Work In Process Inventory
    —       —       —       —  
 
             
Lesser of:
                               
 
             
(i) Advance Rate
    60.0 %     60.0 %     60.0 %        
NOLV %
                               
(ii) 85% of Net Orderly Liquidation Rate
    0.0 %     0.0 %     0.0 %        
 
                       
 
                               
Available Work In Process Inventory
  $ —     $ —     $ —     $ —  
 
                       
 
                               
Finished Goods Inventory
                               
 
                               
Finished Goods Per Perpetual
  $ —     $ —     $ —     $ —  
 
                               
Less Ineligibles and Inventory Reserves:
                               
Spare parts, packaging, supplies
    —       —       —       —  
 
                               
Damaged, defective, return to vendor, discontinued, nonsalable
    —       —       —       —  
Inventory locations <$100,000 (b)
    —       —       —       —  
 
                               
Subject to consignment
    —       —       —       —  
 
                               
Detonators & Explosives
    —       —       —       —  
 
                               
Items without assigned product class
    —       —       —       —  
 
                               
Intercompany profits included in inventory
    —       —       —       —  
 
                               
Re-stocking and delivery fees included in inventory
    —       —       —       —  
Testing prototypes display items
    —       —       —       —  
 
                               
Shrink reserve (a)
    —       —       —       —  
 
                               
Slow moving and obsolete reserve
    —       —       —       —  
Lower of cost or market reserve
    —       —       —       —  
 
                               
Capitalized favorable variances
    —       —       —       —  
 
                               
Vendor rebate reserve
    —       —       —       —  
Other (per terms of the Credit Agreement)
    —       —       —       —  
 
                       
 
                               
Total Ineligibles
    —       —       —       —  
 
                       
 
                               
Eligible Finished Goods
    —       —       —       —  
 
                               
Lesser of:
                               
 
                               
Advance Rate
    60.0 %     60.0 %     60.0 %        
NOLV %
                               
85% of Net Orderly Liquidation Rate
    0.0 %     0.0 %     0.0 %        
 
                       
 
                               
Available Finished Goods Inventory
  $ —     $ —     $ —     $ —  
 
                       

      (a)   Shrink reserve will represent % of physical inventory discrepancy
observed from most recent field exam.   (b)   Provided that the aggregate value
of RM, WIP, and FG stated at cost is less than $100,000 at a location.

Exhibit C

 

Page 4 of 4

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EXHIBIT C

[FORM OF]
BORROWING REQUEST
[Date]
JPMorgan Chase Bank, N.A.,
     as Administrative Agent
     for the Lenders referred to below
Loan and Agency Services Group
1111 Fannin, 10th Floor
Houston, Texas 77002
Attention: Marshella B. Williams
Telecopy No.: (713) 427-6307
Ladies and Gentlemen:
The undersigned Borrower refers to the Third Amended and Restated Credit
Agreement dated as of December [ ], 2010 (as amended, supplemented or otherwise
modified from time to time, the “Credit Agreement”), among USG Corporation, a
Delaware corporation, the Lenders from time to time party thereto (the
“Lenders”), JPMorgan Chase Bank, N.A., as administrative agent (in such
capacity, the “Administrative Agent”), and Bank of America, N.A. and Wells Fargo
Bank, N.A., as co-syndication agents. Capitalized terms used herein and not
otherwise defined herein shall have the meanings assigned to such terms in the
Credit Agreement. The undersigned Borrower hereby gives you notice pursuant to
Section 2.03 of the Credit Agreement that it requests a Borrowing under the
Credit Agreement and in that connection sets forth below the terms on which such
Borrowing is requested to be made:

  1.   Aggregate Amount of Borrowing1:                          2.   Date of
Borrowing2:                     

 

      1  
In the case of a Eurodollar Borrowing, not less than $5,000,000 and in an
integral multiple of $1,000,000. In the case of an ABR Borrowing, not less than
$1,000,000 and in an integral multiple of $1,000,000.
  2  
This date must be (a) a Business Day and (b)(i) in the case of a Eurodollar
Borrowing, a date not earlier than three Business Days after telephonic notice
of the related Borrowing Request or (ii) in the case of an ABR Borrowing, a date
not earlier than one Business Day after telephonic notice of the related
Borrowing Request, in each case delivered before 11:00 a.m., New York City time.

Exhibit C

 

 

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  3.  
Type of Borrowing3:                     
    4.  
Interest Period4:                     
    5.  
Location and number of the undersigned Borrower’s account to which funds are to
be disbursed:                     

[REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK]
 

      3  
Eurodollar Borrowing or ABR Borrowing.
  4  
Applicable only to a Eurodollar Borrowing, and subject to the definition of
“Interest Period”.

Exhibit C

 

2

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The undersigned Borrower hereby represents and warrants to the Administrative
Agent and the Lenders that, on the date of this Borrowing Request and on the
date of the related Borrowing, the conditions to lending specified in
Section 4.02 of the Credit Agreement are and shall be satisfied.

            Very truly yours,

USG CORPORATION,
      By:           Name:           Title:      

Exhibit C

 

3

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EXHIBIT D
[FORM OF]
INTEREST ELECTION REQUEST
[Date]
JPMorgan Chase Bank, N.A.,
     as Administrative Agent
     for the Lenders referred to below
Loan and Agency Services Group
1111 Fannin, 10th Floor
Houston, Texas 77002
Attention: Marshella B. Williams
Telecopy No.: (713) 427-6307
Ladies and Gentlemen:
The undersigned Borrower refers to the Third Amended and Restated Credit
Agreement dated as of December [       ], 2010 (as amended, supplemented or
otherwise modified from time to time, the “Credit Agreement”), among USG
Corporation, a Delaware corporation, the Lenders from time to time party thereto
(the “Lenders”), JPMorgan Chase Bank, N.A., as administrative agent (in such
capacity, the “Administrative Agent”), and Bank of America, N.A. and Wells Fargo
Bank, N.A., as co-syndication agents. Capitalized terms used herein and not
otherwise defined herein shall have the meanings assigned to such terms in the
Credit Agreement. This notice constitutes a notice of conversion or notice of
continuation, as applicable, under Section 2.07 of the Credit Agreement, and the
undersigned Borrower hereby irrevocably notifies the Administrative Agent of the
following information with respect to the conversion or continuation requested
hereby:

  1.   Borrowing to which this request applies1:        
 
    2.   Principal amount of Borrowing to be converted/continued2:        
 

 

      1  
Specify last day of current Interest Period.
  2  
If different options are being elected with respect to different portions of the
Borrowing, indicate the portions thereof to be allocated to each resulting
Borrowing.

Exhibit D

 

 

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

 

  3.   Effective date of election3:        
 
    4.   Type of resulting Borrowing(s)4:        
 
    5.   Interest Period of resulting Borrowing(s)5:        
 

            Very truly yours,

USG CORPORATION,
      By:           Name:           Title:      

 

      3  
This date must be (a) a Business Day and (b)(i) in the case of a resulting
Eurodollar Borrowing, a date not earlier than three Business Days after
telephonic notice of the related Interest Election Request or (ii) in the case
of a resulting ABR Borrowing, a date not earlier than one Business Day after
telephonic notice of the related Interest Election Request, in each case
delivered before 11:00 a.m., New York City time.
  4  
Eurodollar Borrowing or ABR Borrowing. If different options are being elected
with respect to different portions of the Borrowing, specify type for each
resulting Borrowing.
  5  
Applicable only if the resulting Borrowing is to be a Eurodollar Borrowing, and
subject to the definition of “Interest Period”. Must comply with the definition
of “Interest Period” and end not later than the Maturity Date. If different
options are being elected with respect to different portions of the Borrowing,
specify for each resulting Borrowing.

Exhibit D

 

2

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Exhibit E
[FORM OF]
COMPLIANCE CERTIFICATE
[For the fiscal Quarter ending]
[For the fiscal Year ending]
The undersigned, duly authorized, qualified and acting Financial Officer of USG
Corporation, a corporation organized under the laws of Delaware (“USG”), hereby
certifies that:
(a) This certificate (“Certificate”) is furnished pursuant to Section 5.01(c) of
the Third Amended and Restated Credit Agreement dated as of December
[          ], 2010 (as amended, supplemented or otherwise modified from time to
time, the “Credit Agreement”), among USG, the Lenders from time to time party
thereto (the “Lenders”), JPMorgan Chase Bank, N.A., as administrative agent, and
Bank of America, N.A. and Wells Fargo Bank, N.A., as co-syndication agents.
Capitalized terms used herein have the meanings attributed thereto in the Credit
Agreement unless otherwise defined herein.
(b) As of the date hereof, no Default has occurred [.][except as follows:]
(c) No change in GAAP or in the application of GAAP, in either case, that would
be required to be disclosed to the Securities and Exchange Commission, has
occurred that has affected the financial statements accompanying this
Certificate since the later of December 31, 2009, and the date of the prior
certificate delivered under Section 5.01(c) of the Credit Agreement, except for
those changes disclosed in the report of USG on Form 10-Q or 10-K, as
applicable, for the period ending                     , attached hereto as
Exhibit A (the “Current Report”)[.] [except as follows:]
(d) The financial statements referred to in Section 5.01[(a)][(b)] of the Credit
Agreement which are delivered concurrently with the delivery of this Compliance
Certificate, together with the footnotes and supplemental information related
thereto disclosed in the Current Report, fairly present in all material respects
the financial condition and results of operations of USG and its Subsidiaries on
a consolidated basis for the fiscal [year][quarter] then ended [(subject to
normal year-end audit adjustments and the absence of footnote disclosure)]. Such
financial statements have been prepared in accordance with GAAP applied
consistently throughout the period involved.
(e) The covenant listed and calculated below is based on the financial
statements referred to in Section 5.01[(a)][(b)] of the Credit Agreement which
are delivered concurrently with the delivery of this Certificate, together with
the financial statements previously delivered pursuant to Section 5.01(a) or
(b) that are necessary to determine compliance with such covenant under the
Credit Agreement.
Exhibit E

 

 

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

 

Fixed Charge Coverage Ratio (Section 6.12)
The ratio of

         
(i) Consolidated EBITDA (plus the aggregate amount of Transaction Costs incurred
or accrued, minus the unfinanced portion of Capital Expenditures) for the period
of four consecutive fiscal quarters most recently ended at or prior to the date
of this certificate (the “Measurement Period”)
  $                       
 
       
To
       
 
       
(ii) Fixed Charges for the Measurement Period
  $                       
 
       
Ratio:
       
 
     
 
       
must not exceed:
    1.10 to 1.00  
 
     

Please refer to Schedule 1 for a detailed calculation of the amounts set forth
above.
Exhibit E

 

2

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IN WITNESS WHEREOF, I have hereto set my name.

Dated:

            USG CORPORATION,
      By           Name:           Title:   Financial Officer   

Exhibit E

 

3

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Schedule 1 to
Compliance Certificate
Format to be agreed between JPMorgan and USG.
Exhibit E

 

 

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EXHIBIT F
(JPMORGAN LOGO) [c10185c1018501.gif]
[FORM OF]
ADMINISTRATIVE QUESTIONNAIRE
USG CORPORATION

             
Agent Address:
  JPMorgan Chase Bank, N.A.   Return form to:    
 
           
 
           
 
  JPMorgan Loan Services   Telephone:    
 
           
 
           
 
  1111 Fannin Street, 10th Fl.   Facsimile:    
 
           
 
           
 
  Houston, TX 77002   E-mail:    
 
           

It is very important that all of the requested information be completed
accurately and that this questionnaire be returned promptly. If your institution
is sub-allocating its allocation, please fill out an administrative
questionnaire for each legal entity.
Legal Name of Lender to appear in Documentation:
 
Signature Block
Information:                                                                
                                    

             
•
  Signing Credit Agreement   Yes   No
 
           
 
  •        
 
           
•
  Coming in via Assignment   Yes   No

Type of Lender:
Bank | Asset Manager | Broker/Dealer | CLO/CDO | Finance Company | Hedge Fund |
Insurance | Mutual Fund | Pension Fund | Other Regulated Investment Fund |
Special Purpose Vehicle | Other-please specify) |
Lender Parent:                                                                  
                                                            

      Domestic Address   Eurodollar Address                                    

Exhibit F

 

 

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(JPMORGAN LOGO) [c10185c1018501.gif]
Contacts/Notification Methods: Borrowings, Paydowns, Interest, Fees, etc.
Syndicate-level information (which may contain material non-public information
about the Borrower and its related parties or their respective securities) will
be made available to the Credit Contact(s). The Credit Contacts identified must
be able to receive such information in accordance with his/her institution’s
compliance procedures and applicable laws, including Federal and state
securities laws.

              Primary Credit Contact   Secondary Credit Contact
Name:
       
 
       
 
       
Company:
       
 
       
 
       
Title
       
 
       
 
       
Address:
       
 
       
 
       
 
       
 
       
 
       
 
       
Telephone:
       
 
       
 
       
Facsimile:
       
 
       
 
       
Email Address:
       
 
       

              Primary Operations Contact   Secondary Operations Contact
Name:
       
 
       
 
       
Company:
       
 
       
 
       
Title
       
 
       
 
       
Address:
       
 
       
 
       
 
       
 
       
 
       
 
       
Telephone:
       
 
       
 
       
Facsimile:
       
 
       
 
       
Email Address:
       
 
       

              Bid Contact    
Name:
       
 
 
 
   
 
       
Company:
       
 
 
 
   
 
       
Title
       
 
 
 
   
 
       
Address:
       
 
 
 
   
 
       
 
 
 
   
 
       
 
 
 
   
 
       
Telephone:
       
 
 
 
   
 
       
Facsimile:
       
 
 
 
   
 
       
Email Address:
       
 
 
 
   

Exhibit F

 

2

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(JPMORGAN LOGO) [c10185c1018501.gif]
Lender’s Domestic Wire Instructions

     
Bank Name:
   
 
   
 
   
ABA/Routing No.:
   
 
   
 
   
Account Name:
   
 
   
 
   
Account No.:
   
 
   
 
   
FFC Account Name:
   
 
   
 
   
FFC Account No.:
   
 
   
 
   
Attention:
   
 
   
 
   
Reference:
   
 
   

Agent’s Wire Instructions

     
Bank Name:
   
 
   
 
   
ABA/Routing No.:
   
 
   
 
   
Account Name:
   
 
   
 
   
Account No.:
   
 
   
 
   
FFC Account Name:
   
 
   
 
   
FFC Account No.:
   
 
   
 
   
Attention:
   
 
   
 
   
Reference:
   
 
   

Exhibit F

 

3

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Tax Documents
NON-U.S. LENDER INSTITUTIONS:
I. Corporations:
If your institution is incorporated outside of the United States for U.S.
federal income tax purposes, and is the beneficial owner of the interest and
other income it receives, you must complete one of the following three tax
forms, as applicable to your institution: a.) Form W-8BEN (Certificate of
Foreign Status of Beneficial Owner), b.) Form W-8ECI (Income Effectively
Connected to a U.S. Trade or Business), or c.) Form W-8EXP (Certificate of
Foreign Government or Governmental Agency).
A U.S. taxpayer identification number is required for any institution submitting
Form W-8ECI. It is also required on Form W-8BEN for certain institutions
claiming the benefits of a tax treaty with the U.S. Please refer to the
instructions when completing the form applicable to your institution. In
addition, please be advised that U.S. tax regulations do not permit the
acceptance of faxed forms. An original tax form must be submitted.
II. Flow-Through Entities:
If your institution is organized outside the U.S., and is classified for U.S.
federal income tax purposes as either a Partnership, Trust, Qualified or
Non-Qualified Intermediary, or other non-U.S. flow-through entity, an original
Form W-8IMY (Certificate of Foreign Intermediary, Foreign Flow-Through Entity,
or Certain U.S. Branches for United States Tax Withholding) must be completed by
the intermediary together with a withholding statement. Flow-through entities
other than Qualified Intermediaries are required to include tax forms for each
of the underlying beneficial owners.
Please refer to the instructions when completing this form. In addition, please
be advised that U.S. tax regulations do not permit the acceptance of faxed
forms. Original tax form(s) must be submitted.
U.S. LENDER INSTITUTIONS:
If your institution is incorporated or organized within the United States, you
must complete and return Form W-9 (Request for Taxpayer Identification Number
and Certification). Please be advised that we request that you submit an
original Form W-9.
Pursuant to the language contained in the tax section of the Credit Agreement,
the applicable tax form for your institution must be completed and returned
prior to the first payment of income. Failure to provide the proper tax form
when requested may subject your institution to U.S. tax withholding.
Exhibit F

 

4

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EXHIBIT G
[FORM OF]
PERFECTION CERTIFICATE
Reference is made to the Third Amended and Restated Credit Agreement dated as of
December [          ], 2010 (as amended, supplemented or otherwise modified from
time to time, the “Credit Agreement”), among USG Corporation, a Delaware
corporation (the “Borrower”), the Lenders from time to time party thereto,
JPMorgan Chase Bank, N.A., as administrative agent (in such capacity, the
“Administrative Agent”), and Bank of America, N.A. and Wells Fargo Bank, N.A.,
as co-syndication agents. Capitalized terms used but not defined herein have the
meanings assigned in the Credit Agreement or the Security Agreement referred to
therein, as applicable. For purposes of this Perfection Certificate (this
“Certificate”), “Grantors” shall mean the Borrower and each Loan Party that is a
wholly-owned Subsidiary.
The undersigned, a Financial Officer of the Borrower, hereby certifies to the
Administrative Agent and each other Secured Party as follows:
1. Names. (a) The exact legal name of each Grantor, as such name appears in its
respective certificate of formation, is as follows:
(b) Set forth below is each other legal name each Grantor has had in the past
two years, together with the date of the relevant change:
(c) Except as set forth in Schedule 1 hereto, no Grantor has changed its
identity or corporate structure in any way within the past two years. Changes in
identity or corporate structure would include mergers, consolidations and
acquisitions, as well as any change in the form, nature or jurisdiction of
organization. If any such change has occurred, include in Schedule 1 the
information required by Sections 1 and 2 of this certificate as to each acquiree
or constituent party to a merger or consolidation.
(d) The following is a list of all other names (including trade names or similar
appellations) used by each Grantor or any of its divisions or other business
units in connection with the conduct of its business or the ownership of its
properties at any time during the past two years:
(e) Set forth below is the Organizational Identification Number, if any, issued
by the jurisdiction of formation of each Grantor that is a registered
organization:
(f) Set forth below is the Federal Taxpayer Identification Number of each
Grantor:1
2. Current Locations. (a) The chief executive office of each Grantor is located
at the address set forth opposite its name below:

              Grantor   Mailing Address   County   State              

 

      1   Necessary only for Grantors organized under the laws of North Dakota
or South Dakota.

Exhibit G

 

 

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

 

(b) Set forth below opposite the name of each Grantor are all locations where
such Grantor maintains any books or records relating to any Accounts:

              Grantor   Mailing Address   County   State              

(c) Set forth below opposite the name of each Grantor are all locations where
such Grantor maintains any Collateral other than that referred to in
Section 2(b):

              Grantor   Mailing Address   County   State              

(d) The jurisdiction of formation of each Grantor that is a registered
organization is set forth opposite its name below:

      Grantor:   Jurisdiction:

(e) Set forth below opposite the name of each Grantor are all the places of
business of such Grantor not identified in paragraph (a), (b), (c) or (d) above:

              Grantor   Mailing Address   County   State              

(f) Set forth below opposite the name of each Grantor are the names and
addresses of all Persons other than such Grantor that have possession of any of
the Collateral of such Grantor:

              Grantor   Mailing Address   County   State              

Exhibit G

 

 

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

 

3. Unusual Transactions. All Accounts have been originated by the Grantors in
the ordinary course of business.
4. File Search Reports. File search reports have been obtained from each Uniform
Commercial Code filing office identified with respect to such Grantor in
Section 2 hereof, and such search reports reflect no liens against any of the
Collateral other than those permitted under the Credit Agreement.
5. UCC Filings. Financing statements in substantially the form of Schedule 5
hereto have been prepared for filing in the proper Uniform Commercial Code
filing office in the jurisdiction in which each Grantor is located.
6. Schedule of Filings. Attached hereto as Schedule 6 is a schedule setting
forth, with respect to the filings described in Section 5 above, each filing and
the filing office in which such filing is to be made.
7. Deposit Accounts. Attached hereto as Schedule 7 is a true and correct list of
Collateral Deposit Accounts maintained by each Grantor, including the name and
address of the depositary institution, the type of account and the account
number.
Exhibit G

 

 

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

 

IN WITNESS WHEREOF, the undersigned have duly executed this Certificate on this
[          ] day of December, 2010.

            USG CORPORATION,
      By           Name:           Title:   Financial Officer   

Exhibit G

 

 

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EXHIBIT H
[FORM OF]
REVOLVING NOTE

      $[Amount]   New York, New York

FOR VALUE RECEIVED, the undersigned (the “Borrower”) hereby unconditionally
promises to pay to the order of [LENDER NAME] or its registered assigns (the
“Lender”), at the offices of JPMorgan Chase Bank, N.A. (“Administrative Agent”)
at 270 Park Avenue, New York, NY 10017, or such other place as Administrative
Agent shall have specified, in dollars and in immediately available funds, in
accordance with Section 2.09 of the Credit Agreement (as defined below) on the
Maturity Date (capitalized terms used and not otherwise defined herein shall
have the meanings assigned to such terms in the Credit Agreement), the principal
amount of [Amount in words] dollars and 0/100 ($[Amount]) or, if less, the then
unpaid principal amount of all Revolving Loans made by the Lender to the
Borrower pursuant to the Credit Agreement.
The Borrower further unconditionally promises to pay interest on the unpaid
principal amount of each Revolving Loan made by the Lender to the Borrower in
like money at said office until paid at the rate or rates per annum, from the
dates and payable on the dates set forth in the Credit Agreement.
This revolving note (this “Note”) is one of the promissory notes referred to in
Section 2.09(f) of the Third Amended and Restated Credit Agreement dated as of
December [       ], 2010 (as amended, supplemented or otherwise modified from
time to time, the “Credit Agreement”), among USG Corporation, a Delaware
corporation, the Lenders from time to time party thereto (the “Lenders”),
JPMorgan Chase Bank, N.A., as Administrative Agent, and Bank of America, N.A.
and Wells Fargo Bank, N.A., as co-syndication agents, and is entitled to the
benefits thereof and of the other Loan Documents.
In case an Event of Default shall occur and be continuing, the principal of and
accrued interest on this Note may be declared to be due and payable in the
manner and with the effect provided in the Credit Agreement.
The Borrower hereby waives presentment, demand, protest or notice of any kind in
connection with this Note.
Exhibit H

 

 

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

 

THIS NOTE SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAW OF THE
STATE OF NEW YORK.

            USG CORPORATION,
      By           Name:           Title:      

Exhibit H

 

2

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EXHIBIT I
REAFFIRMATION AGREEMENT (this “Agreement”) dated as of December 21, 2010, among
USG CORPORATION, a Delaware corporation (“Borrower”), each subsidiary of the
Borrower that is a signatory hereto (each, a “Subsidiary Party” and, together
with the Borrower, the “Reaffirming Parties”) and JPMORGAN CHASE BANK, N.A.
(“JPMCB”), as Administrative Agent under the Existing Credit Agreement (as
defined in the Restatement Agreement referred to below).
WHEREAS the Borrower, the Lenders (such term and each other capitalized term
used but not defined herein having the respective meanings assigned to such
terms in the Restatement Agreement (as defined below) or the Existing Credit
Agreement, as the case may be) and JPMCB, as Administrative Agent, Issuing Bank
and Swingline Lender, have entered into the Third Amendment and Restatement
Agreement dated as of December 21, 2010 (the “Restatement Agreement”);
WHEREAS each of the Reaffirming Parties is party to one or more of the
Collateral Documents and the Guarantee Agreement (collectively, the “Reaffirmed
Agreements”);
WHEREAS each Reaffirming Party expects to realize, or has realized, substantial
direct and indirect benefits as a result of the Restatement Agreement becoming
effective and the consummation of the transactions contemplated thereby; and
WHEREAS the execution and delivery of this Agreement is a condition precedent to
the consummation of the transactions contemplated by the Restatement Agreement.
NOW, THEREFORE, in consideration of the foregoing and for other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
ARTICLE I.
Reaffirmation/Third Amendment and Restatement
SECTION 1.01. Reaffirmation. (a) Each of the Reaffirming Parties hereby consents
to the Restatement Agreement and the transactions contemplated thereby and
hereby confirms its guarantees, pledges, grants of security interests and other
agreements, as applicable, under each of the Reaffirmed Agreements to which it
is party and agrees that, notwithstanding the effectiveness of the Restatement
Agreement and the consummation of the transactions contemplated thereby
(including, without limitation, the amendment and restatement of the Existing
Credit Agreement), such guarantees, pledges, grants of security interests and
other agreements shall continue to be in full force and effect and shall accrue
to the benefit of the Lenders under the Restated Credit Agreement. Each of the
Reaffirming Parties further agrees to take any action that may be required under
any applicable law or that is reasonably requested by the Administrative Agent
to ensure compliance by the Borrower with Section 5.10 of the Restated Credit
Agreement and hereby reaffirms its obligations under each similar provision of
each Reaffirmed Agreement to which it is a party.
Exhibit I

 

 

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(b) Each of the Reaffirming Parties party to each of the Reaffirmed Agreements
securing the Obligations hereby confirms and agrees that the Revolving Loans,
the Letters of Credit, the Swingline Loans and the Overadvances (in each case,
if any) have constituted and continue to constitute Obligations (or any word of
like import) under such documents.
SECTION 1.02. Amendment and Restatement. On and after the effectiveness of the
Restatement Agreement, (i) each reference in each Reaffirmed Agreement to the
“Credit Agreement”, “thereunder”, “thereof” or words of like import shall mean
and be a reference to the Restated Credit Agreement, as such agreement may be
amended, modified or supplemented and in effect from time to time and (ii) the
definition of any term defined in any Reaffirmed Agreement by reference to the
terms defined in the “Credit Agreement” shall be amended to be defined by
reference to the defined term in the Restated Credit Agreement, as the same may
be amended, modified or supplemented and in effect from time to time.
ARTICLE II.
Representations and Warranties
Each Reaffirming Party hereby represents and warrants, which representations and
warranties shall survive execution and delivery of this Agreement, as follows:
SECTION 2.01. Organization. Such Reaffirming Party is duly organized and validly
existing and, to the extent such concept is applicable in the corresponding
jurisdiction, in good standing under the laws of the jurisdiction of its
organization.
SECTION 2.02. Authority; Enforceability. Such Reaffirming Party has the
requisite power and authority to execute, deliver and perform its obligations
under this Agreement and has taken all necessary action to authorize the
execution, delivery and performance by it of this Agreement. Such Reaffirming
Party has duly executed and delivered this Agreement, and this Agreement
constitutes its legal, valid and binding obligation, enforceable against it in
accordance with its terms, subject to (a) the effects of bankruptcy, insolvency,
moratorium, reorganization, fraudulent conveyance or other similar laws
affecting creditors’ rights generally, (b) general principles of equity
(regardless of whether such enforceability is considered in a proceeding in
equity or at law) and (c) implied covenants of good faith and fair dealing.
Exhibit I

 

2

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SECTION 2.03. Reaffirmed Agreements. The representations and warranties of such
Reaffirming Party contained in each Reaffirmed Agreement that are qualified by
materiality are true and correct and the representations and warranties of such
Reaffirming Party contained in each Reaffirmed Agreement that are not so
qualified are true and correct in all material respects, in each case on and as
of the date hereof with the same effect as though made on and as of such date,
except to the extent such representations and warranties expressly relate to an
earlier date (in which case such representations and warranties shall have been
true and correct (or true and correct in all material respect, as the case may
be) as of such earlier date).
ARTICLE III.
Miscellaneous
SECTION 3.01. Notices. All notices and other communications hereunder shall be
made at the addresses, in the manner and with the effect provided in
Section 9.01 of the Restated Credit Agreement.
SECTION 3.02. Loan Document. This Agreement is a Loan Document executed pursuant
to the Restated Credit Agreement and shall (unless otherwise expressly indicated
herein) be construed, administered and applied in accordance with the terms and
provisions thereof.
SECTION 3.03. Section Captions. Section captions used in this Agreement are for
convenience of reference only and shall not affect the construction of this
Agreement.
SECTION 3.04. Successors and Assigns. This Agreement shall inure to the benefit
of and be binding upon the parties hereto and their respective successors and
assigns.
SECTION 3.05. Amendment. This Agreement may be waived, modified or amended only
by a written agreement executed by each of the parties hereto.
SECTION 3.06. Counterparts. This Agreement may be executed in any number of
counterparts and by the different parties hereto on separate counterparts, each
of which when so executed and delivered shall be an original but all of which
shall together constitute one and the same agreement. Delivery of an executed
counterpart of a signature page of this Agreement by facsimile or other
electronic transmission shall be effective as delivery of a manually executed
counterpart of this Agreement.
SECTION 3.07. Applicable Law; Waiver of Jury Trial. (A) THIS AGREEMENT SHALL BE
CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE STATE OF NEW YORK.
(B) EACH PARTY HERETO HEREBY AGREES AS SET FORTH IN SECTIONS 9.09 AND 9.10 OF
THE RESTATED CREDIT AGREEMENT AS IF SUCH SECTION WERE SET FORTH IN FULL HEREIN.
Exhibit I

 

3

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SECTION 3.08. No Novation. Neither this Agreement nor the execution, delivery or
effectiveness of the Restatement Agreement shall discharge or release the Lien
or priority of any Loan Document or any other security therefor. Nothing herein
contained shall be construed as a substitution or novation of the obligations
outstanding under the Existing Credit Agreement or instruments securing or
guaranteeing the same, which shall remain in full force and effect, except to
any extent modified hereby or by instruments executed concurrently herewith.
Nothing implied in this Agreement, the Restatement Agreement, the Restated
Credit Agreement or in any other document contemplated hereby or thereby shall
be construed as a release or other discharge of the Borrower or any Subsidiary
Party under any Reaffirmed Agreement from any of its obligations and liabilities
as the “Borrower”, a “Grantor” or a “Guarantor” under the Existing Credit
Agreement or the Reaffirmed Agreements. Each of the Reaffirmed Agreements shall
remain in full force and effect until (as applicable) and except to any extent
modified hereby or in connection herewith.
[Signature Pages Follow]
Exhibit I

 

4

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IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement as of
the day and year first above written.

                  USG CORPORATION,    
 
           
 
  by        
 
     
 
Name:    
 
      Title:    
 
                UNITED STATES GYPSUM COMPANY,    
 
           
 
  by        
 
           
 
      Name:    
 
      Title:    
 
                USG INTERIORS, INC.,    
 
           
 
  by        
 
           
 
      Name:    
 
      Title:    
 
                L & W SUPPLY CORPORATION,    
 
           
 
  by        
 
           
 
      Name:    
 
      Title:    
 
                CALIFORNIA WHOLESALE MATERIAL SUPPLY, LLC,    
 
           
 
  by        
 
           
 
      Name:    
 
      Title:    

Exhibit I

 

 

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                  LIVONIA BUILDING MATERIALS, LLC,    
 
           
 
  by        
 
     
 
Name:    
 
      Title:    
 
                USG FOREIGN INVESTMENTS, LTD.,    
 
           
 
  by        
 
           
 
      Name:    
 
      Title:    
 
                OTSEGO PAPER, INC.,    
 
           
 
  by        
 
           
 
      Name:    
 
      Title:    

Exhibit I

 

 

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                  JPMORGAN CHASE BANK, N.A., as Administrative Agent,    
 
           
 
  by        
 
     
 
Name:    
 
      Title:    

Exhibit I