Exhibit 10.1

 

EXECUTION COPY

 

SECOND AMENDED AND RESTATED

CREDIT AND GUARANTY AGREEMENT

 

Among

 

MASTERCRAFT BOAT COMPANY, LLC,

MASTERCRAFT SERVICES, INC.,

MCBC HYDRA BOATS, LLC

and

MASTERCRAFT INTERNATIONAL SALES ADMINISTRATION, INC.

as Borrowers

and

 

the other Credit Parties

 

Various Lenders

From Time to Time Party Hereto

 

and

 

FIFTH THIRD BANK,

an Ohio banking corporation,

as Agent and L/C Issuer and Lender

 

Dated as of MAY 27, 2016

 

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FIFTH THIRD BANK,

as Lead Arranger and Sole Book Runner

 

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TABLE OF CONTENTS

 

 

 

Page

 

 

 

SECTION 1

DEFINITIONS; INTERPRETATION

2

 

 

Section 1.1

Definitions

2

Section 1.2

Interpretation

33

Section 1.3

Change in Accounting Principles

34

Section 1.4

Financial Covenant Calculations

35

Section 1.5

Outstanding Obligations

35

 

 

SECTION 2

THE CREDIT FACILITIES

36

 

 

Section 2.1

Term Loan Commitments

36

Section 2.2

Revolving Credit Commitments

36

Section 2.3

Letters of Credit

37

Section 2.4

Applicable Interest Rates

40

Section 2.5

Manner of Borrowing Loans and Designating Applicable Interest Rates; Funding

41

Section 2.6

Minimum Borrowing Amounts; Maximum Eurodollar Loans

43

Section 2.7

Maturity of Loans

44

Section 2.8

Prepayments

44

Section 2.9

Place and Application of Payments

47

Section 2.10

Commitment Terminations

49

Section 2.11

Swing Loans

50

Section 2.12

Evidence of Indebtedness

51

Section 2.13

Fees

52

Section 2.14

Account Debit

53

Section 2.15

Collections; Controlled Disbursement Accounts

53

 

 

SECTION 3

CONDITIONS PRECEDENT

55

 

 

Section 3.1

All Credit Events

55

Section 3.2

Initial Credit Event

56

 

 

SECTION 4

THE COLLATERAL, GUARANTIES

59

 

 

Section 4.1

Collateral

59

Section 4.2

Liens on Real Property; Collateral Access Agreements

60

Section 4.3

Guaranties

60

Section 4.4

Further Assurances

60

 

 

SECTION 5

REPRESENTATIONS AND WARRANTIES

61

 

 

Section 5.1

Organization and Qualification

61

Section 5.2

Authority and Enforceability

61

Section 5.3

Financial Reports

62

Section 5.4

No Material Adverse Change

62

 

i

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TABLE OF CONTENTS
(continued)

 

 

Page

 

 

 

Section 5.5

Litigation and Other Controversies

62

Section 5.6

True and Complete Disclosure

62

Section 5.7

Use of Proceeds; Margin Stock

62

Section 5.8

Taxes

63

Section 5.9

ERISA

63

Section 5.10

Subsidiaries

64

Section 5.11

Compliance with Laws

64

Section 5.12

Environmental Matters

64

Section 5.13

Investment Company

65

Section 5.14

Intellectual Property

65

Section 5.15

Good Title

65

Section 5.16

Labor Relations

65

Section 5.17

Capitalization

65

Section 5.18

Other Agreements

65

Section 5.19

Governmental Authority and Licensing

65

Section 5.20

Approvals

66

Section 5.21

Affiliate Transactions

66

Section 5.22

Solvency

66

Section 5.23

No Broker Fees

66

Section 5.24

PATRIOT Act; Foreign Corrupt Practices Act

66

Section 5.25

[Reserved]

67

Section 5.26

Security Interest in Collateral

67

Section 5.27

Common Enterprise

67

 

 

SECTION 6

COVENANTS

68

 

 

Section 6.1

Information Covenants

68

Section 6.2

Inspections; Books and Records

71

Section 6.3

Maintenance of Property, Insurance, Environmental Matters, etc.

72

Section 6.4

Preservation of Existence

73

Section 6.5

Compliance with Laws

73

Section 6.6

ERISA

73

Section 6.7

Payment of Taxes and Other Obligations

74

Section 6.8

Transactions with Affiliates

74

Section 6.9

Sale and Leaseback Transactions

74

Section 6.10

Interest Rate Protection

74

Section 6.11

Indebtedness

75

Section 6.12

Liens

76

Section 6.13

Consolidation, Merger, Sale of Assets, etc.

77

Section 6.14

Advances, Investments, Acquisitions and Loans

79

 

ii

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TABLE OF CONTENTS

(continued)

 

 

Page

 

 

 

Section 6.15

Restricted Payments

80

Section 6.16

Limitation on Restrictions

81

Section 6.17

Limitation on the Creation of Subsidiaries

81

Section 6.18

Material Contracts; Other Agreements

81

Section 6.19

OFAC; Anti-Corruption Laws; Sanctions

82

Section 6.20

Name, Fiscal Year Accounting and Organizational Documents

82

Section 6.21

Deposit Accounts and Cash Management Services

82

Section 6.22

Financial Covenants

82

Section 6.23

Holdings; Limitations

83

Section 6.24

Foreign Subsidiary Limitations

84

 

 

SECTION 7

EVENTS OF DEFAULT AND REMEDIES

84

 

 

Section 7.1

Events of Default

84

Section 7.2

Non-Bankruptcy Defaults

87

Section 7.3

Bankruptcy Defaults

87

Section 7.4

Collateral for Undrawn Letters of Credit

87

Section 7.5

Notice of Default

88

Section 7.6

Expenses

88

Section 7.7

Right to Cure Certain Financial Covenant Defaults

88

 

 

SECTION 8

CHANGE IN CIRCUMSTANCES AND CONTINGENCIES

89

 

 

Section 8.1

Funding Indemnity

89

Section 8.2

Illegality

90

Section 8.3

Unavailability of Deposits or Inability to Ascertain, or Inadequacy of, LIBOR

91

Section 8.4

Increased Costs

91

Section 8.5

Taxes

92

Section 8.6

Mitigation Obligations; Replacement of Lenders

96

Section 8.7

Defaulting Lenders

97

Section 8.8

Cash Collateral

100

 

 

SECTION 9

THE AGENT

101

 

 

Section 9.1

Appointment and Authority

101

Section 9.2

Rights as a Lender

101

Section 9.3

Exculpatory Provisions

101

Section 9.4

Reliance by Agent

102

Section 9.5

Delegation of Duties

102

Section 9.6

Resignation of Agent

103

Section 9.7

Non-Reliance on Agent and Other Lenders

104

Section 9.8

No Other Duties, etc.

104

Section 9.9

Agent May File Proofs of Claim

104

 

iii

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TABLE OF CONTENTS
(continued)

 

 

Page

 

 

 

Section 9.10

Collateral and Guaranty Matters

105

Section 9.11

Authorization to Enter into, and Enforcement of, the Collateral Documents

105

Section 9.12

Designation of Additional Agents

106

 

 

SECTION 10

MISCELLANEOUS

106

 

 

Section 10.1

No Waiver; Cumulative Remedies

106

Section 10.2

Non-Business Days

106

Section 10.3

Survival of Representations

106

Section 10.4

Survival of Indemnities

106

Section 10.5

Sharing of Set-Off

106

Section 10.6

Notices

107

Section 10.7

Counterparts

109

Section 10.8

Successors and Assigns; Assignments and Participations

109

Section 10.9

Amendments

116

Section 10.10

Headings

117

Section 10.11

Costs and Expenses; Indemnification

117

Section 10.12

Set-off

119

Section 10.13

Entire Agreement

120

Section 10.14

Governing Law

120

Section 10.15

Severability of Provisions

120

Section 10.16

Excess Interest

120

Section 10.17

Construction

121

Section 10.18

Lender’s and L/C Issuer’s Obligations Several

121

Section 10.19

USA PATRIOT Act

121

Section 10.20

Submission to Jurisdiction; Waiver of Jury Trial

121

Section 10.21

Treatment of Certain Information; Confidentiality

122

Section 10.22

Subordination of Intercompany Indebtedness

123

Section 10.23

Prior Agreements

124

 

 

SECTION 11

GUARANTY

124

 

 

Section 11.1

Guaranty

124

Section 11.2

Guaranty of Payment

125

Section 11.3

No Discharge or Diminishment of Guaranty

125

Section 11.4

Waiver of Defenses

126

Section 11.5

Rights of Subrogation

126

Section 11.6

Reinstatement; Stay of Acceleration

126

Section 11.7

Information

127

Section 11.8

Termination

127

Section 11.9

Severability

127

Section 11.10

Contribution

127

 

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TABLE OF CONTENTS
(continued)

 

 

Page

 

 

 

Section 11.11

Liability Cumulative

128

Section 11.12

Eligible Contract Participant

128

Section 11.13

Keepwell

128

 

 

SECTION 12

BORROWER REPRESENTATIVE

129

 

 

Section 12.1

Appointment; Nature of Relationship

129

Section 12.2

Powers

129

Section 12.3

Notices

129

Section 12.4

Successor Borrower Representative

129

Section 12.5

Execution of Loan Documents

129

Section 12.6

Reporting

130

 

Exhibit A

—

Notice of Payment Request

Exhibit B

—

Notice of Borrowing

Exhibit C

—

Notice of Continuation/Conversion

Exhibit D-1

—

Term Note

Exhibit D-2

—

Revolving Note

Exhibit D-3

—

Swing Note

Exhibit E

—

Compliance Certificate

Exhibit F

—

Assignment and Assumption

Exhibit G

—

Joinder Agreement

Exhibits H-1
through H-4

—

Tax Certificates

 

 

 

Schedule 1

—

Commitments

Schedule 5.9

—

ERISA

Schedule 5.10

—

Subsidiaries

Schedule 5.16

—

Labor Relations

Schedule 5.17

—

Capitalization of Credit Parties

Schedule 6.11

—

Indebtedness

Schedule 6.12

—

Liens

Schedule 6.14

—

Investments

Schedule 6.16

—

Restrictions

Schedule 10.8(b)

 

Prohibited Assignees

 

v

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SECOND AMENDED AND RESTATED
CREDIT AND GUARANTY AGREEMENT

 

This Second Amended and Restated Credit and Guaranty Agreement is entered into
as of May 27, 2016, by and among MASTERCRAFT BOAT COMPANY, LLC, a Delaware
limited liability company (“MasterCraft”), MASTERCRAFT SERVICES, INC., a
Tennessee corporation (“Services”), MCBC HYDRA BOATS, LLC, a Tennessee limited
liability company (“Hydra”), MASTERCRAFT INTERNATIONAL SALES
ADMINISTRATION, INC., a Delaware corporation (“Sales Administration”), and each
other Person that becomes a “Borrower” hereunder pursuant to a Joinder Agreement
(collectively, “Borrowers” and, individually, each a “Borrower”), MCBC
HOLDINGS, INC., a Delaware corporation (“Holdings”), as a Guarantor, the other
Credit Parties named herein from time to time, the various institutions from
time to time party to this Agreement, as Lenders, and FIFTH THIRD BANK, an Ohio
banking corporation, as Agent and L/C Issuer.

 

RECITALS

 

WHEREAS, Borrowers and Holdings and Agent and the Lenders entered into that
certain Amended and Restated Credit and Guaranty Agreement dated as of March 13,
2015 (as amended by that certain Amendment No. 1 dated as of February 18, 2016,
the “Existing Credit Agreement”), which amended and restated that certain Credit
and Guaranty Agreement dated as of December 20, 2013 (the “Original Loan
Agreement”), with the Existing Credit Agreement providing for Revolving Loans in
the maximum principal amount of $30,000,000, a Term Loan in the original
principal amount of $75,000,000 and other credit accommodations, for an
aggregate credit facility in the amount of  $105,000,000;

 

WHEREAS, in connection therewith, the parties thereto entered into that certain
Security Agreement dated as of December 20, 2013 (the “Original Security
Agreement”), and that certain Amended and Restated Security Agreement dated as
of March 13, 2015 (the “Existing Security Agreement”), which amended and
restated the Original Security Agreement, together with other ancillary
Collateral Documents and other Loan Documents (each as defined in the Existing
Credit Agreement);

 

WHEREAS, in connection with the IPO of Holdings in July of 2015, all Obligations
in respect of the Term Loan under and as defined in the Existing Credit
Agreement were paid in full;

 

WHEREAS, each of Borrowers and Holdings have requested that Agent and the
Lenders (i) modify the Loans and other credit accommodations under the Existing
Credit Agreement to provide for an aggregate credit facility in the amount of
$80,000,000 consisting of Revolving Credit Commitments in the aggregate amount
of $30,000,000 and Term Loan Commitments in the aggregate amount of $50,000,000,
(ii) permit the Second Restatement Dividend, (iii) extend the Maturity Date to
May 27, 2021, and (iv) make certain other modifications and amendments to the
Existing Credit Agreement, all as set forth in this Agreement;

 

WHEREAS, as set forth in the Loan Documents, each of the Credit Parties
(i) shall be Borrowers or Guarantors, as applicable, hereunder jointly and
severally liable for all Loans and

 

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related Obligations, (ii) shall guaranty the Obligations of each other Credit
Party hereunder as set forth in Section 11 hereof, and (iii) shall reaffirm and
grant to Agent, for the benefit of Agent and Lenders, a Lien on its Collateral
to secure such Obligations, and the Obligations of the Credit Parties under this
Agreement, as continued from the Original Loan Agreement and the Existing Credit
Agreement, shall continue to be secured by the Collateral pursuant to the
Existing Security Agreement, as amended on the date hereof in connection with
this Agreement; and

 

WHEREAS, this Agreement shall become effective, and shall amend and restate the
Existing Credit Agreement, upon the execution of this Agreement by Borrowers,
the other Credit Parties, Agent and the Lenders and upon the satisfaction of the
conditions contained in Section 3 hereof; and from and after such effective
time, (i) all references made to the Existing Credit Agreement in the Loan
Documents or in any other instrument or document executed and/or delivered
pursuant thereto shall, without any further action, be deemed to refer to this
Agreement and (ii) the Existing Credit Agreement shall be amended and restated
in its entirety hereby, provided, however, the obligations to repay the loans
and advances arising under the Existing Credit Agreement shall continue in full
force and effect to the extent provided in this Agreement and the Liens securing
payment thereof shall be continuing but shall now be governed by the terms of
this Agreement and the other Loan Documents.

 

NOW, THEREFORE, in consideration of any Loans (including any Loans by renewal or
extension) heretofore and hereafter made to Borrowers by Agent and/or Lenders,
and for other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged by the Credit Parties, the parties agree as
follows:

 

SECTION 1

 

DEFINITIONS; INTERPRETATION.

 

Section 1.1            Definitions.  The following terms when used herein shall
have the following meanings:

 

“ACH” is defined in Section 2.15(a) hereof.

 

“Acquired Business” means the entity or assets acquired by any Credit Party or a
Subsidiary in an Acquisition, whether before or after the date hereof.

 

“Acquisition” means any transaction or series of related transactions for the
purpose of or resulting, directly or indirectly, in (a) the acquisition of all
or substantially all of the assets of a Person, or of any business or division
of a Person, (b) the acquisition of in excess of 50% of the capital stock,
partnership interests, membership interests or equity of any Person (other than
a Person that is a Subsidiary), or otherwise causing any Person to become a
Subsidiary, or (c) a merger or consolidation or any other combination with
another Person (other than a Person that is a Subsidiary).

 

“Adjusted LIBOR” means, for any Borrowing of Eurodollar Loans, a rate per annum
equal to the quotient of (i) LIBOR, divided by (ii) one minus the Reserve
Percentage.

 

2

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

 

“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. 
Notwithstanding the foregoing, no portfolio company of Sponsor or its Affiliates
(other than the Credit Parties and their Subsidiaries) shall be deemed an
Affiliate of any Credit Party.

 

“Affiliated Lender” is defined in Section 10.08(g) hereof.

 

“Agent” means Fifth Third Bank, an Ohio banking corporation, in its capacity as
administrative agent for itself and the other Lenders and any successor pursuant
to Section 9.7 hereof.

 

“Agreement” means this Second Amended and Restated Credit and Guaranty
Agreement, as the same may be amended, modified, restated or supplemented from
time to time pursuant to the terms hereof.

 

“Applicable Advance Multiple” means 1.50.

 

“Applicable Loans” is defined in Section 10.08(g) hereof.

 

“Applicable Margin” means, with respect to Loans, Reimbursement Obligations, and
the Commitment Fees and L/C Fees payable under Section 2.13 hereof, until the
first Pricing Date, the rates per annum shown opposite Level III below, and
thereafter from one Pricing Date to the next the Applicable Margin means the
rates per annum determined in accordance with the following schedule:

 

LEVEL

 

SENIOR
LEVERAGE RATIO
FOR SUCH PRICING
DATE

 

APPLICABLE
MARGIN FOR BASE
RATE LOANS:

 

APPLICABLE
MARGIN FOR
EURODOLLAR
LOANS:

 

APPLICABLE
MARGIN FOR
COMMITMENT FEE:

 

I

 

Greater than or equal to 2.50 to 1.0

 

1.50

%

3.50

%

0.50

%

II

 

Less than 2.50 to 1.0, but greater than or equal to 2.00 to 1.0

 

1.25

%

3.25

%

0.50

%

III

 

Less than 2.0 to 1.0, but greater than or equal to 1.50 to 1.0

 

1.00

%

3.00

%

0.35

%

IV

 

Less than 1.50 to 1.0

 

0.75

%

2.75

%

0.35

%

 

3

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For purposes hereof, the term “Pricing Date” means, for any fiscal quarter of
the Credit Parties and their Subsidiaries ending on or after November 30, 2016,
the date on which the Agent is in receipt of Borrowers’ and their Subsidiaries’
most recent financial statements for the fiscal quarter then ended, pursuant to
Section 6.1 hereof.  The Applicable Margin shall be established based on the
Senior Leverage Ratio for the most recently completed fiscal quarter, and the
Applicable Margin established on a Pricing Date shall remain in effect until the
next Pricing Date.  If the Credit Parties have not delivered their financial
statements by the date such financial statements (and, in the case of the
year-end financial statements, audit report) are required to be delivered under
Section 6.1 hereof, until such financial statements and audit report are
delivered, the Applicable Margin shall be the highest Applicable Margin (i.e.,
the Senior Leverage Ratio shall be deemed to be greater than or equal to 2.50 to
1.0).  If the Credit Parties subsequently deliver such financial statements
before the next Pricing Date, the Applicable Margin established by such
late-delivered financial statements shall take effect from the date of delivery
until the next Pricing Date.  In all other circumstances, the Applicable Margin
established by such financial statements shall be in effect from the Pricing
Date that occurs immediately after the end of the fiscal quarter covered by such
financial statements until the next Pricing Date.  Each determination of the
Applicable Margin made by the Agent in accordance with the foregoing shall be
conclusive and binding on the Credit Parties and the Lenders absent manifest
error.

 

Without limitation of any other provision of this Agreement, or any other remedy
available to Agent or the Lenders under any of the Loan Documents, to the extent
that any financial statements delivered pursuant to Section 6.1 or any
information contained in any certificate delivered pursuant to Section 6.1 shall
be incorrect in any material manner that would have led to the application of a
higher Applicable Margin for any period, then (i) the Borrower Representative
shall deliver to the Agent restated financial statements or other corrected
information in an executed certificate (“Correction Certificate”), (ii) the
Applicable Margin for such period shall be the Applicable Margin corresponding
to such restated financial statements or other corrected information and, all
Loans shall bear interest based upon such recalculated Applicable Margin
retroactively from the date of the delivery of the erroneous financial
statements or other erroneous information in question, and (iii) any additional
amounts payable as a result of such retroactive application that are
attributable to prior periods shall be due and payable by Borrower
Representative upon delivery to Agent of the Correction Certificate.

 

“Applicable Percentage” means, with respect to any Revolving Lender, the
percentage of the total Revolving Credit Commitments represented by such
Revolving Lender’s Revolving Credit Commitment; provided that if the Revolving
Credit Commitments have terminated or expired, the Applicable Percentages shall
be determined based upon the Revolving Credit Commitments most recently in
effect, giving effect to any assignments.

 

“Application” is defined in Section 2.3(b) hereof.

 

“Approved Fund” means any Fund that is administered or managed by (a) a Lender,
(b) an Affiliate of a Lender or (c) an entity or an Affiliate of an entity that
administers or manages a Lender.

 

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

 

4

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

 

Section 10.8), and accepted by the Agent, in substantially the form of Exhibit F
attached hereto or any other form approved by the Agent.

 

“Authorized Representative” means those Persons shown on the list of officers or
other authorized individuals provided by the Credit Parties pursuant to
Section 3.2 hereof or on any update of any such list provided by the Credit
Parties to the Agent, or any further or different officers or authorized
individuals of the Credit Parties so named by any Authorized Representative of
the Credit Parties in a written notice to the Agent.

 

“Banking Services Obligations” means the liability of any Credit Party or any
Subsidiary owing to any of the Lenders, or any Affiliates of such Lenders,
arising out of (a) the execution or processing of electronic transfers of funds
by automatic clearing house (ACH) transfer, return items, overdrafts, interstate
depository network services, wire transfer or otherwise to or from the deposit
accounts of any Credit Party or any Subsidiary now or hereafter maintained with
any of the Lenders or their Affiliates, (b) the acceptance for deposit or the
honoring for payment of any check, draft or other item with respect to any such
deposit accounts, (c) credit card and purchasing card services provided to any
Credit Party by a Lender while such Person is a Lender hereunder, and (d) any
other deposit, disbursement, and cash management services afforded to any Credit
Party or any Subsidiary by any of such Lenders or their Affiliates.

 

“Bankruptcy Code” shall mean the United States Bankruptcy Code, 11 U.S.C. §101
et seq., as in effect from time to time, and any successor statute thereto.

 

“Base Rate” means for any day the greatest of:  (a) the rate of interest last
quoted by The Wall Street Journal (or such other national publication selected
by the Agent) from time to time as the “prime rate” as in effect on such day,
with any change in the Base Rate resulting from a change in said prime rate to
be effective as of the date of the relevant change in said prime rate (it being
acknowledged that such rate may not be the Agent’s best or lowest rate), (b) the
sum of (x) the Federal Funds Rate, plus (y) 1/2 of 1% and (c) the sum of (x) the
Adjusted LIBOR that would be applicable to a Eurodollar Loan with a 1 month
Interest Period advanced on such day (or, if such day is not a Business Day, the
immediately preceding Business Day) plus (y) one percent (1.00%).

 

“Base Rate Loan” means a Loan bearing interest at a rate specified in
Section 2.4(a) hereof.

 

“Borrower(s)” means, individually and collectively, jointly and severally (a) as
of the Original Closing Date, the Restatement Closing Date and the Second
Restatement Closing Date, (i) MasterCraft, (ii) Services, (iii) Hydra; and
(iv) Sales Administration, and (b) each other Person that becomes a “Borrower”
hereunder pursuant to a Joinder Agreement after the Second Restatement Closing
Date.

 

“Borrower Representative” is defined in Section 12.1 hereof; and as of the
Original Closing Date and Second Restatement Closing Date is MasterCraft.

 

“Borrowing” means the total of Loans of a single type advanced, continued for an
additional Interest Period, or converted from a different type into such type by
the Lenders under a Credit on a single date and, in the case of Eurodollar
Loans, for a single Interest Period.

 

5

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Borrowings of Loans are made and maintained ratably from each of the Lenders
under a Credit according to their Percentages of such Credit.  A Borrowing is
“advanced” on the day the Lenders advance funds comprising such Borrowing to
Borrower Representative, is “continued” on the date a new Interest Period for
the same type of Loans commences for such Borrowing, and is “converted” when
such Borrowing is changed from one type of Loans to the other, all as requested
by Borrower Representative pursuant to Section 2.5(a) hereof.  Borrowings of
Swing Loans are made by the Agent in accordance with the procedures set forth in
Section 2.11 hereof.

 

“Business Day” means (i) with respect to all notices and determinations in
connection with the Eurodollar Rate, any day (other than a Saturday or Sunday)
on which commercial banks are open in London, England, New York, New York, and
Cincinnati, Ohio for dealings in deposits in the London Interbank Market; and
(ii) in all other cases, any day on which commercial banks in Cincinnati, Ohio
are required by law to be open for business; provided that, notwithstanding
anything to the contrary in this definition of “Business Day”, at any time
during which a Rate Management Agreement with Lender is then in effect with
respect to all or a portion of this Agreement, then the definitions of “Business
Day” and “Banking Day”, as applicable, pursuant to such Rate Management
Agreement shall govern with respect to all applicable notices and determinations
in connection with such portion of this Agreement subject to such Rate
Management Agreement.  Periods of days referred to in this Agreement will be
counted in calendar days unless Business Days are expressly prescribed.

 

“Capital Expenditures” means, with respect to any Person for any period, the
aggregate amount of all expenditures (whether paid in cash or accrued as a
liability) by such Person during that period for the acquisition or leasing
(pursuant to a Capital Lease) of fixed or capital assets or additions to
property, plant, or equipment (including replacements, capitalized repairs, and
improvements) which should be capitalized on the balance sheet of such Person in
accordance with GAAP, but excluding expenditures made in connection with the
replacement, substitution or restoration of assets to the extent financed
(a) from insurance proceeds (or other similar recoveries) paid on account of the
loss of or damage to the assets being replaced or restored, or (b) with awards
of compensation arising from the taking by eminent domain or condemnation of the
assets being replaced.

 

“Capital Lease” means any lease of Property which in accordance with GAAP is
classified as a capital lease.

 

“Capitalized Lease Obligation” means, for any Person, the amount of the
liability shown on the balance sheet of such Person in respect of a Capital
Lease determined in accordance with GAAP.

 

“Cash Collateralize” means, to pledge and deposit with or deliver to the Agent,
(a) for the benefit of one or more of the L/C Issuers or Lenders, as collateral
for L/C Obligations or obligations of Lenders to fund participations in respect
of L/C Obligations, cash or deposit account balances in the Minimum Collateral
Amount or, if the Agent and each L/C Issuer shall agree in their sole
discretion, other credit support, in each case pursuant to documentation in form
and substance reasonably satisfactory to the Agent and L/C Issuer, or (b) for
the benefit of any Lender that has provided Banking Services Obligations.  “Cash
Collateral” shall have a

 

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meaning correlative to the foregoing and shall include the proceeds of such cash
collateral and other credit support.

 

“Cash Equivalents” shall mean, as to any Person:  (a) investments in direct
obligations of the United States of America or of any agency or instrumentality
thereof whose obligations constitute full faith and credit obligations of the
United States of America, provided that any such obligations shall mature within
one (1) year of the date of issuance thereof; (b) investments in commercial
paper rated at least P-1 by Moody’s and at least A-1 by S&P maturing within
ninety (90) days from the date of issuance thereof; (c) investments in
certificates of deposit issued by any Lender or by any United States commercial
bank having capital and surplus of not less than $250,000,000 which have a
maturity of one year or less; (d) investments in repurchase obligations with a
term of not more than seven (7) days for underlying securities of the types
described in clause (a) above entered into with any bank meeting the
qualifications specified in clause (c) above, provided all such agreements
require physical delivery of the securities securing such repurchase agreement,
except those delivered through the Federal Reserve Book Entry System; and
(e) investments in money market funds that invest solely, and which are
restricted by their respective charters to invest solely, in investments of the
type described in the immediately preceding subsections (a), (b), (c), and
(d) above; and (f) other short term liquid investments approved in writing by
the Agent.

 

“CERCLA” means the Comprehensive Environmental Response, Compensation and
Liability Act of 1980, as amended by the Superfund Amendments and
Reauthorization Act of 1986, 42 U.S.C. §§9601 et seq., and any future
amendments.

 

“Change in Law” means the occurrence, after the date of this Agreement, of any
of the following:  (a) the adoption or taking effect of any law, rule,
regulation or treaty, (b) any change in any law, rule, regulation or treaty or
in the administration, interpretation, implementation or application thereof by
any Governmental Authority or (c) the making or issuance of any request, rule,
guideline or directive (whether or not having the force of law) by any
Governmental Authority; provided that notwithstanding anything herein to the
contrary, (x) the Dodd-Frank Wall Street Reform and Consumer Protection Act and
all requests, rules, guidelines or directives thereunder or issued in connection
therewith and (y) all requests, rules, guidelines or directives promulgated by
the Bank for International Settlements, the Basel Committee on Banking
Supervision (or any successor or similar authority) or the United States or
foreign regulatory authorities, in each case pursuant to Basel III, shall in
each case be deemed to be a “Change in Law”, regardless of the date enacted,
adopted or issued.

 

“Change of Control” means the occurrence of one or more of the following events:
(i) any sale, lease, exchange or other transfer (in a single transaction or a
series of related transactions) of all or substantially all of the assets of any
Credit Party to any Person or “group” (within the meaning of the Exchange Act
and the rules of the SEC thereunder in effect on the date hereof) other than
pursuant to a transaction expressly permitted hereunder or approved by the
Required Lenders in accordance herewith, (ii) the acquisition of ownership,
directly or indirectly, beneficially or of record, by any Person or “group”
(within the meaning of the Exchange Act and the rules of the SEC thereunder as
in effect on the date hereof but excluding Sponsor and any Sponsor Entities) of
30% or more of the outstanding voting Equity Interests of Holdings,
(iii) Holdings ceases to own and control, directly or indirectly, beneficially
and of

 

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record 100% of the outstanding Equity Interests of Mastercraft, or (iv) during
any period of 12 consecutive months, a majority of the members of the board of
directors or other equivalent governing body of Holdings cease to be composed of
individuals who are Continuing Directors.

 

“Class” means when used in reference to any Loan or Borrowing, refers to whether
such Loan, or the Loans comprising such Borrowing, are Revolving Loans, Term
Loans or Swing Loans.

 

“Closing Date Transactions” means, collectively, the closing and consummation of
the financings contemplated by this Agreement as of the Second Restatement
Closing Date and the Term Loan Funding Date, including the Second Restatement
Dividend.

 

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

 

“Collateral” means all properties, rights, interests, and privileges from time
to time subject to the Liens granted to the Agent for the benefit of the
Lenders, or any security trustee therefor, by the Collateral Documents, but in
no event shall include any Excluded Assets or Excluded Vehicles.

 

“Collateral Access Agreement” is defined in the Security Agreement.

 

“Collateral Account” is defined in Section 7.4(b) hereof.

 

“Collateral Documents” means the Mortgages, the Security Agreement, the
Collateral Access Agreements, and all other mortgages, deeds of trust, security
agreements, pledge agreements, account control agreements, assignments,
financing statements and other documents as shall from time to time secure or
relate to the Obligations, the Rate Management Obligations, and the Banking
Services Obligations, or any part thereof.

 

“Collection Account” is defined in Section 2.15(a) hereof.

 

“Commitment Fee” is defined in Section 2.13(a) of this Agreement.

 

“Commitments” means the Revolving Credit Commitments, and the Term Loan
Commitments.

 

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

 

“Communications” has the meaning set forth in Section 10.6(d)(ii).

 

“Compliance Certificate” is defined in Section 6.1(d) of this Agreement.

 

“Connection Income Taxes” means Other Connection Taxes that are imposed on or
measured by net income (however denominated) or that are franchise Taxes or
branch profits Taxes.

 

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“Continuing Director” means, with respect to any period, any individuals (A) who
were members of the board of directors or other equivalent governing body of
Holdings on the first day of such period, (B) whose election or nomination to
that board or equivalent governing body was approved by individuals referred to
in clause (A) above constituting at the time of such election or nomination at
least a majority of that board or equivalent governing body, or (C) whose
election or nomination to that board or other equivalent governing body was
approved by individuals referred to in clauses (A) and (B) above constituting at
the time of such election or nomination at least a majority of that board or
equivalent governing body.

 

“Contingent Obligation” shall mean as to any Person, any obligation of such
Person guaranteeing or intended to guarantee any Indebtedness (“primary
obligations”) of any other Person (the “primary obligor”) in any manner, whether
directly or indirectly, including, without limitation, any obligation of such
Person, whether or not contingent, (i) to purchase any such primary obligation
or any Property constituting direct or indirect security therefor, (ii) to
advance or supply funds (x) for the purchase or payment of any such primary
obligation or (y) to maintain working capital or equity capital of the primary
obligor or otherwise to maintain the net worth or solvency of the primary
obligor, (iii) to purchase property, securities or services primarily for the
purpose of assuring the owner of any such primary obligation of the ability of
the primary obligor to make payment of such primary obligation or (iv) otherwise
to assure or hold harmless the holder of such primary obligation against loss in
respect thereof; provided, however, that the term Contingent Obligation shall
not include endorsements of instruments for deposit or collection in the
ordinary course of business.  The amount of any Contingent Obligation shall be
deemed to be an amount equal to the stated or determinable amount of the primary
obligation in respect of which such Contingent Obligation is made or, if not
stated or determinable, the maximum reasonably anticipated liability in respect
thereof (assuming such Person is required to perform thereunder) as determined
by such Person in good faith; provided, that with respect to Floorplan
Repurchase Obligations, the amount of such Contingent Obligations shall be
determined in accordance with GAAP.

 

“Contras” is defined in the definition of “Eligible Account”.

 

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

 

“Control Agreement” is defined in the Security Agreement.

 

“Controlled Disbursement Account” is defined in Section 2.15(a) hereof.

 

“Controlled Group” means all members of a controlled group of corporations, all
trades or businesses (whether or not incorporated) under common control and all
members of an affiliated service group which, together with any Credit Party,
are treated as a single employer under Section 414 of the Code.  Notwithstanding
the foregoing, no portfolio company of Sponsor or its Affiliates (other than the
Credit Parties and their Subsidiaries) shall be deemed part of a Controlled
Group.

 

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“Credit” means any of the Revolving Credit and the Term Credit.

 

“Credit Event” means the advancing of any Loan, the continuation of or
conversion into a Eurodollar Loan, or the issuance of, or extension of the
expiration date or increase in the amount of, any Letter of Credit.

 

“Credit Parties” means each Borrower and each Guarantor a party to this
Agreement.

 

“Curable Financial Covenant” means each of, and collectively, (a) the Total
Leverage Ratio financial covenant under Section 6.22(a) for each Curable Test
Period, and (b) the Fixed Charge Coverage Ratio financial covenant under
Section 6.22(b) for each Curable Test Period.

 

“Curable Test Period” is defined in Section 7.7(a) hereof.

 

“Cure Amount” is defined in Section 7.7(a) hereof.

 

“Cure Date” means with respect to the Curable Test Periods ending on the last
day of the fiscal month of each of March, June, September and December of each
fiscal year, the tenth (10th) Business Day after the date on which the
applicable Cure Notice is delivered to Agent pursuant to, and in accordance
with, Section 7.7(a) of this Agreement.

 

“Cure Notice” is defined in Section 7.7(a) hereof.

 

“Cure Right” is defined in Section 7.7(a) hereof.

 

“Damages” means all damages including, without limitation, punitive damages,
liabilities, costs, expenses, losses, judgments, diminutions in value, fines,
penalties, demands, claims, cost recovery actions, lawsuits, administrative
proceedings, orders, response actions, removal and remedial costs, compliance
costs, investigation expenses, consultant fees, reasonable and documented
attorneys’ and paralegals’ fees and litigation expenses.

 

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

 

“Default” means any event or condition the occurrence of which would, with the
passage of time or the giving of notice, or both, constitute an Event of
Default.

 

“Defaulting Lender” means, subject to Section 8.7(b), any Lender that (a) has
failed to (i) fund all or any portion of its Loans within three Business Days of
the date such Loans were required to be funded hereunder unless such Lender
notifies the Agent and Borrower Representative in writing that such failure is
the result of such Lender’s determination that one or more conditions precedent
to funding (each of which conditions precedent, together with any applicable
default, shall be specifically identified in such writing) has not been
satisfied, or (ii) pay to the Agent, any L/C Issuer, any Swing Line Lender or
any other Lender any other amount required to be paid by it hereunder (including
in respect of its participation in Letters of Credit or Swing Loans) within two
Business Days of the date when due, (b) has notified

 

10

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Borrower Representative, the Agent or any L/C Issuer or any Swing Line Lender in
writing that it does not intend to comply with its funding obligations
hereunder, or has made a public statement to that effect (unless such writing or
public statement relates to such Lender’s obligation to fund a Loan hereunder
and states that such position is based on such Lender’s determination that a
condition precedent to funding (which condition precedent, together with any
applicable default, shall be specifically identified in such writing or public
statement) cannot be satisfied), (c) has failed, within three Business Days
after written request by the Agent or Borrower Representative, to confirm in
writing to the Agent and Borrower Representative that it will comply with its
prospective funding obligations hereunder (provided that such Lender shall cease
to be a Defaulting Lender pursuant to this clause (c) upon receipt of such
written confirmation by the Agent and Borrower Representative), or (d) has, or
has a direct or indirect parent company that has, (i) become the subject of a
proceeding under any Debtor Relief Law, or (ii) had appointed for it a receiver,
custodian, conservator, trustee, administrator, assignee for the benefit of
creditors or similar Person charged with reorganization or liquidation of its
business or assets, including the Federal Deposit Insurance Corporation or any
other state or federal regulatory authority acting in such a capacity; provided
that a Lender shall not be a Defaulting Lender solely by virtue of the ownership
or acquisition of any equity interest in that Lender or any direct or indirect
parent company thereof by a Governmental Authority so long as such ownership
interest does not result in or provide such Lender 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 Lender (or such
Governmental Authority) to reject, repudiate, disavow or disaffirm any contracts
or agreements made with such Lender.  Any determination by the Agent that a
Lender is a Defaulting Lender under any one or more of clauses (a) through
(d) above shall be conclusive and binding absent manifest error, and such Lender
shall be deemed to be a Defaulting Lender (subject to Section 8.7(b)) upon
delivery of written notice of such determination to Borrower Representative, the
L/C Issuer, each Swing Line Lender and each Lender.

 

“Disposition” means the sale, lease, conveyance or other disposition of
Property, other than sales or other dispositions expressly permitted under
Sections 6.13 hereof (other than clause (h) thereof).

 

“Dollars” and “$” each means the lawful currency of the United States of
America.

 

“Domestic Subsidiary” means any Subsidiary that is organized under the laws of
any political subdivision of the United States.

 

“EBITDA” means as to the Credit Parties and their Subsidiaries on a consolidated
basis, with reference to any period, without duplication, Net Income for such
period plus the sum of all amounts deducted in arriving at such Net Income for
such period: (a) Interest Expense for such period, (b) tax expense (including
without limitation, federal, state, local and foreign income taxes) paid or
accrued for such period, (c) all distributions paid to the equity holders of
Borrowers for income tax liabilities attributable to their allocated share of
Borrowers’ taxable income for such period, (d) amounts attributable to
depreciation and amortization expense for such period, (e) non-recurring fees,
costs and expenses for such period incurred in connection with entering into
this Agreement, the other Loan Documents and the transactions contemplated
thereby on the Second Restatement Closing Date in an aggregate amount not to
exceed

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$1,500,000, (f) non-cash charges for such period (including, without limitation,
stock-based compensation expense, currency translations, impairment charges and
gains or losses on asset dispositions), (g) fees and reimbursed expenses paid to
Sponsor, Sponsor Entities and independent directors during such period for
advisory and board management services in an aggregate amount not to exceed
$250,000 in any fiscal year, (h) all other extraordinary or non-recurring
expenses and losses for such period in an amount reasonably acceptable to Agent,
(i) non-recurring fees, costs and expenses during such period incurred in
connection with any Permitted Acquisition, permitted disposition, permitted
equity issuance and/or permitted investment, in each case, whether or not
consummated, (j) the Management Bonus Payments, and (k) non-recurring fees,
costs and expenses for such period incurred in connection with litigation with
Malibu Boats, LLC concerning allegations of IP infringement and any related
actions not to exceed an aggregate amount of $2,500,000 in any fiscal year.
 With respect to any period during which any Permitted Acquisition has occurred,
for purposes of determining compliance with the financial covenants set forth in
Section 6.22, EBITDA shall be calculated with respect to such period on a pro
forma basis (provided, that any pro forma adjustments included therein shall
have been approved by the Agent, in its reasonable discretion) using the
historical audited financial statements of any business so acquired and the
financial statements of Holdings and its Subsidiaries which shall be
reformulated as if such Permitted Acquisition, and any Indebtedness incurred or
repaid in connection therewith, had been consummated or incurred or repaid at
the beginning of such period (and assuming that such Indebtedness bears interest
during any portion of the applicable measurement period prior to the relevant
acquisition at the weighted average of the interest rates applicable to
outstanding Loans incurred during such period).

 

“Eligible Assignee” means any Person that meets the requirements to be an
assignee under Section 10.8(b)(iii), (v) and (vi) (subject to such consents, if
any, as may be required under Section 10.8(b)(iii)).

 

“Environmental Claim” means any investigation, notice, violation, demand,
allegation, action, suit, injunction, judgment, order, consent decree, penalty,
fine, lien, proceeding or claim (whether administrative, judicial or private in
nature) arising (a) pursuant to, or in connection with an actual or alleged
violation of, any Environmental Law, (b) in connection with any Hazardous
Material, (c) from any abatement, removal, remedial, corrective or response
action in connection with a Hazardous Material, Environmental Law or order of a
Governmental Authority, issued pursuant to any Environmental Law, or (d) from
any actual or alleged damage, injury, threat or harm to health, environmental
safety, natural resources or the environment from any Hazardous Material.

 

“Environmental Law” means any current or future Legal Requirement pertaining to
(a) the protection of health, safety and the indoor or outdoor environment,
(b) the conservation, management or use of natural resources and wildlife,
(c) the protection or use of surface water or groundwater, (d) the management,
manufacture, possession, presence, use, generation, transportation, treatment,
storage, disposal, Release, threatened Release, abatement, removal, remediation
or handling of, or exposure to, any Hazardous Material or (e) pollution
(including any Release to air, land, surface water or groundwater), and any
amendment, rule, regulation, order or directive issued thereunder.

 

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“Equity Interests” shall mean, with respect to any Person, all shares,
interests, participations or other equivalents (however designated, whether
voting or non-voting) of such Person’s capital, including equity appreciation
rights, whether now outstanding or issued or acquired after the date of this
Agreement, including common shares, preferred shares, membership interests in a
limited liability company, limited or general partnership interests in a
partnership or any other equivalent of such ownership interest.

 

“ERISA” means the Employee Retirement Income Security Act of 1974, as amended,
or any successor statute thereto.

 

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

 

“ERISA Event” means (a) a “reportable event” within the meaning of Section 4043
of ERISA or the regulations thereunder (excluding those for which notice to the
PBGC has been waived as of the date hereof) with respect to a Pension Plan;
(b) the failure to meet the Pension Funding Rules with respect to any Pension
Plan (whether or not waived in accordance with Section 412(c) of the Code), the
failure to make by its due date any minimum required contribution or any
required installment under Section 430(j) of the Code with respect to any
Pension Plan or the failure to make by its due date any required contribution to
a Multiemployer Plan; (c) the withdrawal of the Borrower or any ERISA Affiliate
from a Pension Plan subject to Section 4063 of ERISA during a plan year in which
such entity was a “substantial employer” as defined in Section 4001(a)(2) of
ERISA or a cessation of operations that is treated as such a withdrawal under
Section 4062(e) of ERISA; (d) a complete or partial withdrawal by the Borrower
or any ERISA Affiliate from a Multiemployer Plan; (e) the filing of a notice of
intent to terminate, the treatment of a Pension Plan amendment as a termination
under Section 4041 or 4041A of ERISA; (f) the institution by the PBGC of
proceedings to terminate a Pension Plan under Section 4042 of ERISA for the
termination of, or the appointment of a trustee to administer, any Pension Plan;
(g) notification that a Multiemployer Plan is in endangered or critical status
within the meaning of Section 432 of the Code or Section 305 of ERISA; or
(h) the imposition of any material liability under Title IV of ERISA, other than
for PBGC premiums due but not delinquent under Section 4007 of ERISA, upon  the
Borrower or any ERISA Affiliate.

 

“Eurodollar Loan” means a Loan bearing interest at the rate specified in
Section 2.4(b) hereof.

 

“Event of Default” means any event or condition identified as such in
Section 7.1 hereof.

 

“Event of Loss” means, with respect to any Property, any of the following: 
(a) any loss, destruction or damage of such Property or (b) any condemnation,
seizure, or taking, by exercise of the power of eminent domain or otherwise, of
such Property, or confiscation of such Property or the requisition of the use of
such Property.

 

“Excess Availability” shall mean, as of any date of determination by Agent, the
Revolving Loan Availability in each case as of the close of business on such
date and assuming,

 

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for purposes of calculation, that all accounts payable which remain unpaid more
than sixty (60) days after the due dates thereof as the close of business on
such date are treated as additional Revolving Loans outstanding on such date.

 

“Excess Cash Flow” shall mean, for each of the Credit Parties’ Fiscal Years, the
EBITDA for such period (excluding any pro forma adjustments to EBITDA as a
result of any Permitted Acquisition (but, in any case, including the actual
EBITDA generated by the Person acquired in connection with the Permitted
Acquisition during any period, from the date of the consummation of the
Permitted Acquisition to the end of the applicable measurement period)), minus
cash taxes (including, without limitation, foreign, federal, state and local
income taxes paid during such period of the Credit Parties, including, without
limitation, Permitted Tax Distributions made in cash during such period, minus
actual principal and scheduled interest payments made with respect to
Indebtedness during such period (including, without limitation, those principal
payments required to be paid pursuant to Section 2.7(a) and (b) hereof), minus
all Capital Expenditures (other than Capital Expenditures financed with the
proceeds of purchase money indebtedness or capitalized lease obligations to the
extent permitted under this Agreement) by the Credit Parties during such period,
minus unfinanced consideration paid in such period with respect to any Permitted
Acquisition including earnout payments, minus all cash items added back to
EBITDA, excluding any Management Bonus Payments.

 

“Excess Interest” is defined in Section 10.16 hereof.

 

“Exchange Act” means the Securities Exchange Act of 1934, as amended from time
to time, and any successor statute and the rules promulgated thereunder.

 

“Excluded Assets” is defined in Section 4.1.

 

“Excluded Subsidiary” means, as of the Original Closing Date and the Second
Restatement Closing Date, Parts.

 

“Excluded Swap Obligation” means, with respect to any guarantor of a Swap
Obligation, including the grant of a security interest to secure the guaranty of
such Swap Obligation, any Swap Obligation if, and to the extent that, such Swap
Obligation is or becomes illegal under the Commodity Exchange Act or any rule,
regulation or order of the Commodity Futures Trading Commission (or the
application or official interpretation of any thereof) by virtue of such
guarantor’s failure for any reason to constitute an “eligible contract
participant” as defined in the Commodity Exchange Act and the regulations
thereunder at the time the guaranty or grant of such security interest becomes
effective with respect to such Swap Obligation.  If a Swap Obligation arises
under a master agreement governing more than one swap, such exclusion shall
apply only to the portion of such Swap Obligation that is attributable to swaps
for which such Swap Obligation or security interest is or becomes illegal.

 

“Excluded Taxes” means any of the following Taxes imposed on or with respect to
a Recipient or required to be withheld or deducted from a payment to a
Recipient, (a) Taxes imposed on or measured by net income (however denominated),
franchise Taxes, and branch profits Taxes, in each case, (i) imposed as a result
of such Recipient being organized under the laws of, or having its principal
office or, in the case of any Lender, its applicable lending office

 

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located in, the jurisdiction imposing such Tax (or any political subdivision
thereof) or (ii) that are Other Connection Taxes, (b) in the case of a Lender,
U.S. federal withholding Taxes imposed on amounts payable to or for the account
of such Lender with respect to an applicable interest in a Loan or Commitment
pursuant to a law in effect on the date on which (i) such Lender acquires such
interest in the Loan or Commitment (other than pursuant to an assignment request
by Borrower Representative under Section 8.6(b)) or (ii) such Lender changes its
lending office, except in each case to the extent that, pursuant to Section 8.5,
amounts with respect to such Taxes were payable either to such Lender’s assignor
immediately before such Lender became a party hereto or to such Lender
immediately before it changed its lending office, (c) Taxes attributable to such
Recipient’s failure to comply with Section 8.5(g) and (d) any U.S. federal
withholding Taxes imposed under FATCA.

 

“Excluded Vehicles” is defined in Section 4.1.

 

“Existing Credit Agreement” has the meaning assigned to that term in the
Recitals to this Agreement.

 

“Existing Security Agreement” has the meaning assigned to that term in the
Recitals to this Agreement.

 

“Facilities” means the Revolving Credit, and Term Credit.

 

“FATCA” means Sections 1471 through 1474 of the Code, as of the date of this
Agreement (or any amended or successor version that is substantively comparable
and not materially more onerous to comply with), any current or future
regulations or official interpretations thereof and any agreements entered into
pursuant to Section 1471(b)(1) of the Code.

 

“FCPA” is defined in Section 5.24 hereof.

 

“Federal Funds Rate” means for any day the rate determined by the Agent to be
the average (rounded upward, if necessary, to the next higher 1/100 of 1%) of
the rates per annum quoted to the Agent at approximately 10:00 a.m. (Eastern
time) (or as soon thereafter as is practicable) on such day (or, if such day is
not a Business Day, on the immediately preceding Business Day) by two or more
Federal funds brokers selected by the Agent for sale to the Agent at face value
of Federal funds in the secondary market in an amount equal or comparable to the
principal amount owed to the Agent for which such rate is being determined.

 

“Fee Letters” is defined in Section 2.13(c).

 

“Fifth Third” means Fifth Third Bank, an Ohio banking corporation, in its
individual capacity and any successor thereof.

 

“Fixed Charge Coverage Ratio” means, as of the date of determination thereof,
the ratio of (a) EBITDA for such period minus (i) unfinanced Capital
Expenditures for such period (for the avoidance of doubt, exclusive of Capital
Expenditures financed with the proceeds of purchase money Indebtedness or
Capital Leases to the extent permitted pursuant to Section 6.11 hereof),
(ii) income taxes paid in cash for such period, and (iii) distributions paid in
cash to the

 

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equity holders of the Credit Parties for income tax liabilities attributable to
their allocated share of taxable income for such period including Permitted Tax
Distributions, to (b) Fixed Charges, in each case, for the four fiscal quarters
then ended.

 

“Fixed Charges” means, with reference to any period, for the Credit Parties and
their Subsidiaries on a consolidated basis, without duplication, the sum of
(a) all scheduled payments of principal actually made during such period with
respect to Indebtedness of the Credit Parties and their Subsidiaries, plus
(b) the cash portion of any Interest Expense for such period.

 

“Floorplan Repurchase Obligations” means repurchase obligations of the Credit
Parties pursuant to the floorplan financing arrangements of the Credit Parties.

 

“Foreign Lender” means (a) if a Borrower is a U.S. Person, a Lender that is not
a U.S. Person, and (b) if a Borrower is not a U.S. Person, a Lender that is
resident or organized under the laws of a jurisdiction other than that in which
such Borrower is resident for tax purposes.

 

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

 

“Fronting Exposure” means, at any time there is a Defaulting Lender, (a) with
respect to any L/C Issuer, such Defaulting Lender’s Applicable Percentage of the
outstanding L/C Obligations with respect to Letters of Credit issued by such L/C
Issuer other than L/C Obligations as to which such Defaulting Lender’s
participation obligation has been reallocated to other Lenders or Cash
Collateralized in accordance with the terms hereof, and (b) with respect to any
Swing Line Lender, such Defaulting Lender’s Applicable Percentage of outstanding
Swing Loans made by such Swing Line Lender other than Swing Loans as to which
such Defaulting Lender’s participation obligation has been reallocated to other
Lenders.

 

“Fund” means any Person (other than a natural Person) that is (or will be)
engaged in making, purchasing, holding or otherwise investing in commercial
loans and similar extensions of credit in the ordinary course of its activities.

 

“Funding Account” is defined in Section 2.5(d) hereof.

 

“GAAP” means generally accepted accounting principles set forth from time to
time in the opinions and pronouncements of the Accounting Principles Board and
the American Institute of Certified Public Accountants and statements and
pronouncements of the Financial Accounting Standards Board (or agencies with
similar functions of comparable stature and authority within the U.S. accounting
profession), which are applicable to the circumstances as of the date of
determination.

 

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

 

“Guarantied Obligations” is defined in Section 11.1 hereof.

 

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“Guarantors” means, collectively, each Person who now or hereafter guarantees
payment or performance of the whole or any part of the Obligations.  Each
Borrower hereunder is a Guarantor of the Obligations of the other Borrowers
hereunder pursuant to Section 11 hereof.  As of the Original Closing Date, the
Restatement Closing Date and the Second Restatement Closing Date, Holdings is
the only non-Borrower Guarantor.

 

“Guaranty” and “Guaranties” means Section 11 of this Agreement and each separate
guaranty, in form and substance reasonably satisfactory to the Agent, delivered
by any Guarantor.

 

“Hazardous Material” means any substance, chemical, compound, product, solid,
gas, liquid, waste, byproduct, pollutant, contaminant or material which is
listed, identified, classified or regulated as “hazardous” or “toxic” or words
of like import pursuant to an Environmental Law, including without limitation,
asbestos, polychlorinated biphenyls and petroleum (including crude oil or any
fraction thereof).

 

“Holdings” means MCBC Holdings, Inc., a Delaware corporation and a Guarantor
hereunder.

 

“Hostile Acquisition” means the acquisition of the capital stock or other Equity
Interests of a Person through a tender offer or similar solicitation of the
owners of such capital stock or other Equity Interests which has not been
approved (prior to such acquisition) by resolutions of the Board of Directors of
such Person or by similar action if such Person is not a corporation, or, if
such acquisition has been so approved, as to which such approval has not been
withdrawn

 

“Hydra” means MCBC Hydra Boats, LLC, a Tennessee limited liability company and a
Borrower hereunder.

 

“Indebtedness” means for any Person (without duplication) (a) all indebtedness
of such Person for borrowed money, whether current or funded, or secured or
unsecured, (b) all indebtedness for the deferred purchase price of Property or
services, it being understood that the term “Indebtedness” shall not include
(i) trade payables or (ii) accrued expenses, in each case arising in the
ordinary course of business, (c) all indebtedness created or arising under any
conditional sale or other title retention agreement with respect to Property
acquired by such Person (even though the rights and remedies of the seller or
lender under such agreement in the event of a default are limited to
repossession or sale of such Property), (d) all indebtedness secured by a
purchase money mortgage or other Lien to secure all or part of the purchase
price of Property subject to such mortgage or Lien, (e) all obligations under
leases which shall have been or must be, in accordance with GAAP, recorded as
Capital Leases in respect of which such Person is liable as lessee, (f) any
liability in respect of bankers acceptances or letters of credit, (g) any
indebtedness, whether or not assumed, secured by Liens on Property acquired by
such Person at the time of acquisition thereof, (h) all obligations under any
so-called “synthetic lease” transaction entered into by such Person, (i) all
obligations under any so-called “asset securitization” transaction entered into
by such Person, (j) earnouts, seller notes and similar deferred purchase rice
payment obligations of such Person, (k) all Contingent Obligations with respect
to liabilities which otherwise constitute “Indebtedness” and (l) all Equity
Interests of

 

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such Person subject to repurchase or redemption  prior to the Maturity Date
(other than in connection with a Change of Control).

 

“Indemnified Taxes” means (a) Taxes, other than Excluded Taxes, imposed on or
with respect to any payment made by or on account of any obligation of any
Credit Party under any Loan Document and (b) to the extent not otherwise
described in (a), Other Taxes.

 

“Indemnitee” has the meaning set forth in Section 10.11.

 

“Information” is defined in Section 10.21 hereof.

 

“Intellectual Property” means (i) the names of the Credit Parties and all
fictional business names, trading names, registered and unregistered trademarks,
service marks, and applications thereof; (b) all patents, patent applications,
and inventions and discoveries that may be patentable;(c) all copyrights in both
published and unpublished works; and (d) all know-how, trade secrets,
confidential information, customer lists, software, technical information, data,
process technology, plans, drawings and blue prints, all of the foregoing being
owned, used, and/or licensed by Borrowers and the other Credit Parties (or any
one or more of them).

 

“Interest Expense” means, with reference to any period, the sum of all interest
charges (including fees incurred with respect to letters of credit and imputed
interest charges with respect to Capitalized Lease Obligations and all
amortization of debt discount and expense) of the Credit Parties and their
Subsidiaries for such period determined on a consolidated basis in accordance
with GAAP.

 

“Interest Period” means for each Eurodollar Loan, a period of 1, 2, 3 or 6
months, at Borrower Representative’s election, which period shall commence on a
Business Day selected by Borrower Representative subject to the terms of this
Agreement and shall be determined by Agent in accordance with this Agreement and
Agent’s loan systems and procedures periodically in effect, including, without
limitation, in accordance with the following terms and conditions, as
applicable:

 

(1)           In the case of immediately successive Interest Periods with
respect to a continued Eurodollar Loan, each successive Interest Period shall
commence on the day on which the immediately preceding Interest Period expires,
with interest for such day to be calculated based upon the LIBOR rate in effect
for the new Interest Period;

 

(2)           If an Interest Period would otherwise end on a day that is not a
Business Day, such Interest Period shall end on the next succeeding Business
Day; provided that, if the next succeeding Business Day falls in a new month,
such Interest Period shall end on the immediately preceding Business Day; and

 

(3)           If any Interest Period begins on a Business Day for which there is
no numerically corresponding day in the calendar month at the end of such
Interest Period, then the Interest Period shall end on the last Business Day of
the calendar month ending at the end of such Interest Period, and no Interest

 

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Period with respect to any portion of the Term Loan shall extend beyond the
final Maturity Date of the Term Loan.

 

“IPO” means a primary public offering (other than a public offering pursuant to
a registration statement on Form S-8 (or any successor form)) of the common
stock of Holdings or any IPO Issuer or any Credit Party (or a corporate
successor of any of the foregoing) pursuant to an effective registration
statement filed with the SEC in accordance with the Securities Act (whether
alone or in conjunction with a secondary public offering).

 

“IPO Issuer”  means any Person who directly or indirectly holds 100% of the
Equity Interests of Holdings or any Credit Party and is the issuer in an IPO.

 

“IRS” means the United States Internal Revenue Service.

 

“Joinder Agreement” means an agreement pursuant to which a new Credit Party
becomes a party to this Agreement, substantially in form of Exhibit G.

 

“L/C Fee” is defined in Section 2.13(b) of this Agreement.

 

“L/C Issuer” means Fifth Third, in its capacity as issuer of Letters of Credit
hereunder and any successor L/C Issuer.

 

“L/C Obligations” means the aggregate undrawn face amounts of all outstanding
Letters of Credit (including all automatic increases provided for in such
Letters of Credit, whether or not any such automatic increase has become
effective) and all unpaid Reimbursement Obligations.

 

“L/C Sublimit” means $5,000,000, as reduced pursuant to the terms hereof.

 

“Legal Requirement” means any treaty, convention, statute, law, regulation,
ordinance, license, permit, governmental approval, injunction, judgment, order,
consent decree or other requirement of any Governmental Authority.

 

“Lenders” means the Persons listed on Schedule 1 and any other Person that shall
have become party hereto pursuant to an Assignment and Assumption, other than
any such Person that ceases to be a party hereto pursuant to an Assignment and
Assumption.  Unless the context requires otherwise, the term “Lenders” includes
the Revolving Lenders, the Term Lenders and the Swing Line Lenders.  In addition
to the foregoing, for the purpose of identifying the Persons entitled to share
in the Collateral and the Proceeds thereof under, and in accordance with the
provisions of, this Agreement and the Collateral Documents, the term “Lender”
shall include Affiliates of a Lender to which any permitted Rate Management
Obligations or Banking Services Obligations is owed.

 

“Lending Office” is defined in Section 8.6 hereof.

 

“Letter of Credit” is defined in Section 2.3(a) hereof.

 

“LIBOR” means, for an Interest Period for a Borrowing of Eurodollar Loans, the
rate of interest per annum rounded upwards (the “Rounding Adjustment”), if
necessary, to the next 1/16

 

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of 1% fixed by ICE Benchmark Administration Limited (or any successor thereto,
or replacement thereof, reasonably approved by Agent, each an “Alternative LIBOR
Source”) at approximately 11:00 a.m., London, England time (or the relevant time
established by ICE Benchmark Administration Limited, an Alternate LIBOR Source,
or Agent, as applicable), two (2) Business Days prior to such date of
determination, relating to quotations for the applicable 1 month, 2 month, 3
month or 6 month London InterBank Offered Rates on U.S. Dollar deposits, as
displayed by Bloomberg LP (or any successor thereto or replacement thereof, as
reasonably approved by Agent, each an “Approved Bloomberg Successor”), or if no
longer displayed by Bloomberg LP (or any Approved Bloomberg Successor), such
rate of interest per annum as shall be determined in good faith by Agent from
such sources as it shall determine to be comparable to Bloomberg LP (or any
Approved Bloomberg Successor), all as determined by Agent in accordance with
this Agreement and Agent’s loan systems and procedures periodically in effect;
provided that, notwithstanding the foregoing, in no event shall the LIBOR Rate
be less than zero percent (0%) as of any date (the “LIBOR Rate Minimum”);
provided further that, at any time during which a Rate Management Agreement with
Agent is then in effect with respect to all or a portion of the Obligations, the
LIBOR Rate Minimum and the Rounding Adjustment shall all be disregarded and no
longer of any force and effect with respect to such portion of the Obligations
subject to such Rate Management Agreement.

 

“Lien” means any deed of trust, mortgage, lien, security interest, pledge,
charge or encumbrance of any kind in respect of any Property, including the
interests of a vendor or lessor under any conditional sale, Capital Lease or
other title retention arrangement.

 

“Loan” means any Revolving Loan, Term Loan or Swing Loan, whether outstanding as
a Base Rate Loan or Eurodollar Loan as permitted hereunder, each of which is a
“type” of Loan hereunder.

 

“Loan Documents” means this Agreement, the Notes, the Applications, the
Collateral Documents, the Guaranties, the Rate Management Agreements, Banking
Services Obligations agreements, any Subordination Agreement, the Fee Letters
and each other agreement, instrument or document to be delivered hereunder or
thereunder or otherwise in connection therewith, other than Hedge Agreements.

 

“Management Bonus Payments” is defined in Section 5.7 hereof.

 

“MasterCraft” means MasterCraft Boat Company, LLC, a Delaware limited liability
company, a Subsidiary of Holdings, and a Borrower and Borrower Representative
hereunder.

 

“Material Adverse Effect” means (a) a material adverse change in, or material
adverse effect upon, the operations, business, Property, or financial condition
of the Credit Parties and their Subsidiaries taken as a whole, (b) a material
impairment of the ability of the Credit Parties and their Subsidiaries taken as
a whole to perform their obligations under any Loan Document or (c) a material
adverse effect upon (i) the legality, validity, binding effect or enforceability
against any Credit Party or any Subsidiary of any Loan Document or the rights
and remedies of the Agent and the Lenders thereunder or (ii) the perfection or
priority of any Lien granted under any Collateral Document, other than as a
direct result of an action, inaction or failure of the Agent or any Lender.

 

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“Material Contract” means, with respect to any Person, each contract or
agreement (a) to which such Person is a party involving aggregate consideration
payable to or by such Person of $2,000,000 or more in any year or (b) contracts
involving Floorplan Repurchase Obligations in excess of $1,500,000, or (c) any
other contract, agreement, permit or license, written or oral, of such Person as
to which the breach, nonperformance, cancellation or failure to renew by any
party thereto, individually or in the aggregate, could reasonably be expected to
have a Material Adverse Effect.

 

“Material Plan” is defined in Section 7.1(h) hereof.

 

“Maturity Date” means May 27, 2021.

 

“Maximum Liability” is defined in Section 11.

 

“Maximum Rate” is defined in Section 10.16 hereof.

 

“Minimum Collateral Amount” means, at any time, with respect to Cash Collateral
consisting of cash or deposit account balances, an amount equal to 103% of the
Fronting Exposure of all L/C Issuers with respect to Letters of Credit issued
and outstanding at such time.

 

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

 

“Mortgages” means, collectively, each Mortgage and Security Agreement with
Assignment of Rents and Open-End Mortgage and Security Agreement with Assignment
of Rents between any Credit Party and the Agent relating to such Credit Party’s
real property, fixtures and interests in real property owned as of the Second
Restatement Closing Date and commonly known as 100 Cherokee Cove Drive, Monroe
County, Vonore Tennessee 37885 and any other mortgages or deeds of trust
delivered to the Agent pursuant to Section 4.2 hereof, as the same may be
amended, modified, supplemented or restated from time to time.

 

“Multiemployer Plan” means any employee benefit plan of the type described in
Section 4001(a)(3) of ERISA, to which Borrower or any ERISA Affiliate makes or
is obligated to make contributions, or during the preceding five (5) plan years,
has made or been obligated to make contributions.

 

“Multiple Employer Plan” means a Plan which has two or more contributing
sponsors (including Borrower or any ERISA Affiliate) at least two of whom are
not under common control, as such a plan is described in Section 4064 of ERISA

 

“Net Cash Proceeds” means, as applicable, (a) with respect to any Disposition by
a Person, cash and cash equivalent proceeds received by or for such Person’s
account, net of (i) reasonable direct costs relating to such Disposition
(ii) sale, use or other transactional taxes paid or payable by such Person as a
direct result of such Disposition, (iii) the amount of any Indebtedness secured
by any Permitted Lien on any asset which is required to be and is, repaid in
connection with such sale or disposition, and (iv) reasonable amounts held in
escrow or otherwise held as a reserve against any liabilities under any
indemnification obligations associated with such Disposition, (b) with respect
to any Event of Loss of a Person, cash and cash equivalent proceeds received by
or for such Person’s account (whether as a result of

 

21

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payments made under any applicable insurance policy therefor or in connection
with condemnation proceedings or otherwise), net of reasonable direct costs
incurred in connection with the collection of such proceeds, awards or other
payments, and (c) with respect to any offering of Equity Interests of a Person
or the issuance of any Indebtedness by a Person, cash and cash equivalent
proceeds received by or for such Person’s account, net of (i) reasonable legal,
underwriting, and other fees and expenses incurred as a direct result thereof
and (ii) taxes paid or payable by such Person as a direct result of such
offering or issuance.

 

“Net Income” means, with reference to any period, the net income (or net loss)
of the Credit Parties and their Subsidiaries for such period computed on a
consolidated basis in accordance with GAAP; provided that, there shall be
excluded from Net Income (a) the net income (or net loss) of any Person accrued
prior to the date it becomes a Subsidiary of, or has merged into or consolidated
with, any Credit Party or another Subsidiary, except to the extent that the
Credit Parties have delivered either (i) the financial statements of the
Acquired Business for such period, which financial statements shall have been
audited by an independent accounting firm reasonably satisfactory to the Agent
or otherwise in a form reasonably acceptable to Agent, or (ii) a quality of
earnings report of the Acquired Business covering such period, which quality of
earnings report is in a form reasonably satisfactory to Agent, and the Agent
agrees to the inclusion of such net income (or net loss) of such Person and
(b) the net income (or net loss) of any Person (other than a Subsidiary) in
which any Credit Party or any Subsidiary has an Equity Interest in, except to
the extent of the amount of dividends or other distributions actually paid to
any Credit Party or any Subsidiary during such period, (c) gains and losses or
charges relating to the disposition of assets (other than the sale of inventory
in the ordinary course of business), (d) gains and losses or charges relating to
discontinued operations, (e) extraordinary gains and losses or charges, and
(f) the impact of any purchase accounting treatment or changes in accounting
principles.

 

“Non-Consenting Lender” means any Lender that does not approve any consent,
waiver or amendment that (i) requires the approval of all affected Lenders in
accordance with the terms of Section 10.9 and (ii) has been approved by the
Required Lenders.

 

“Non-Defaulting Lender” means, at any time, each Lender that is not a Defaulting
Lender at such time.

 

“Non-Paying Guarantor” is defined in Section 11.10.

 

“Notes” means and includes the Revolving Notes, the Term Notes and the Swing
Note.

 

“Obligations” means all obligations of any Borrower to pay principal and
interest on the Loans, all Reimbursement Obligations owing under the
Applications, all fees and charges payable hereunder, and all other payment
obligations (monetary (including post-petition interest, allowed or not) or
otherwise) of any Credit Party or any Subsidiary of any Credit Party arising
under or in relation to any Loan Document, all Rate Management Obligations
permitted hereunder, and all Banking Services Obligations, in each case whether
now existing or hereafter arising, due or to become due, direct or indirect,
absolute or contingent, and howsoever evidenced, held or acquired. 
Notwithstanding the foregoing, the term Obligations shall exclude any Excluded
Swap Obligation.

 

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“OFAC” means the Office of Foreign Assets control of the U.S. Department of the
Treasury.

 

“OFAC Sanctions” means the country or list based economic and trade sanctions
administered and enforced by OFAC.

 

“Original Closing Date” means December 20, 2013.

 

“Original Loan Agreement” is defined in the Recitals hereto.

 

“Original Security Agreement” is defined in the Recitals hereto.

 

“Other Connection Taxes” means, with respect to any Recipient, Taxes imposed as
a result of a present or former connection between such Recipient and the
jurisdiction imposing such Tax (other than connections arising solely from such
Recipient having executed, delivered, become a party to, performed its
obligations under, received payments under, received or perfected a security
interest under, engaged in any other transaction pursuant to or enforced any
Loan Document, or sold or assigned an interest in any Loan or Loan Document).

 

“Other Taxes” means all present or future stamp, court or documentary,
intangible, recording, filing or similar Taxes that arise from any payment made
under, from the execution, delivery, performance, enforcement or registration
of, from the receipt or perfection of a security interest under, or otherwise
with respect to, any Loan Document, except any such Taxes that are Other
Connection Taxes imposed with respect to an assignment (other than an assignment
made pursuant to Section 8.6).

 

“Outstanding Indebtedness” is defined in Section 1.5 hereof.

 

“Outstanding Revolving Loans” is defined in Section 1.5 hereof.

 

“Outstanding Term Loans” is defined in Section 1.5 hereof.

 

“Participant” has the meaning assigned to such term in clause (d) of
Section 10.8.

 

“Participant Register” has the meaning specified in clause (d) of Section 10.8.

 

“Participating Interest” is defined in Section 2.3(d) hereof.

 

“Participating Lender” is defined in Section 2.3(d) hereof.

 

“Parts” means MasterCraft Parts, Ltd., a United Kingdom private limited company,
a wholly-owned Subsidiary of Holdings, and an Excluded Subsidiary hereunder.

 

“PATRIOT ACT” is defined in Section 5.24(b) hereof.

 

“Paying Guarantor” is defined in Section 11.10 hereof.

 

“Payment in Full” means, as of any date of determination, that (a) the
Obligations and the Guarantied Obligations (in each case, other than contingent
indemnification obligation and

 

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reimbursement obligations in respect of which no claim for payment has yet been
asserted by the Person entitled thereto, and Banking Services Obligations not
then due and owing), as applicable, are fully paid and satisfied, (b) all
Letters of Credit have been cancelled and returned to the L/C Issuer or either
(i) replaced by an irrevocable letter of credit, on terms acceptable to the L/C
Issuer, issued by a financial institution acceptable to the L/C Issuer, or
(ii) Cash Collateralized, in each case, in an amount at least equal to 103% of
the L/C Obligations, as of such date and on terms satisfactory to the L/C
Issuer, and (c) the Commitments and this Agreement are terminated.

 

“PBGC” means the Pension Benefit Guaranty Corporation or any Person succeeding
to any or all of its functions under ERISA.

 

“Pension Act” means the Pension Protection Act of 2006.

 

“Pension Funding Rules” means the rules of the Code and ERISA regarding minimum
required contributions (including any installment payment thereof) to Pension
Plans and set forth in, with respect to plan years ending prior to the effective
date of the Pension Act, Section 412 of the Code and Section 302 of ERISA, each
as in effect prior to the Pension Act and, thereafter, Section 412, 430, 431,
432 and 436 of the Code and Sections 302, 303, 304 and 305 of ERISA.

 

“Pension Plan” means any employee pension benefit plan (including a Multiple
Employer Plan or a Multiemployer Plan) that is maintained or is contributed to
by Borrower and any ERISA Affiliate and is either covered by Title IV of ERISA
or is subject to the minimum funding standards under Section 412 of the Code.

 

“Percentage” means for any Lender its Applicable Percentage, Term Loan
Percentage; and where the term “Percentage” is applied on an aggregate basis
(including, without limitation, Section 9.6 hereof), such aggregate percentage
shall be calculated by aggregating the separate components of the Applicable
Percentage, Term Loan Percentage, and expressing such components on a single
percentage basis.

 

“Permitted Acquisition” means (i) any Acquisition pursuant to which Agent and
Required Lenders grant their prior written consent (which consent may be granted
or withheld in each Person’s sole and absolute discretion) or (ii) any
Acquisition with respect to which all of the following conditions shall have
been satisfied (unless otherwise approved in writing by Required Lenders):

 

(a)                                 not less than twenty (20) Business Days
prior to the anticipated consummation thereof, Agent shall have received written
notice of a proposed Acquisition and, to the extent available (or, if later,
promptly after they become available) copies of all material Acquisition
documents (with appropriate updated drafts thereof to be delivered to Agent
promptly following the general distribution thereof);

 

(b)                                 Agent shall have received pro forma
financial statements and a pro forma Compliance Certificate demonstrating that,
after giving effect to such Acquisition, and on a trailing twelve (12) month
basis, the Credit Parties and their Subsidiaries shall have (i) a Total Leverage
Ratio equal to or less than the Total Leverage Ratio, required by
Section 6.22(a) for the most recent measurement period, and (ii) a Fixed Charge
Coverage Ratio equal to or greater

 

24

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than the Fixed Charge Coverage Ratio required by Section 6.22(b) for the most
recent measurement period;

 

(c)                                  following receipt of the notice and other
materials described in the preceding clause (a), upon the reasonable request of
Agent, Borrower shall promptly provide to Agent (and Agent shall promptly
provide copies to the Lenders) (i) historical financial statements of the
applicable target(s) for the most recent twelve (twelve (12) months prior to
such Acquisition for which such financial statements are available and (ii) all
material due diligence and other material background materials made available to
any Credit Party with respect to the entity or assets to be acquired in such
Acquisition, including without limitation, additional financial statements and
environmental reports, together with such other material information as Agent
may reasonably request;

 

(d)                                 no Default or Event of Default shall exist
prior to, or as the result of, such Acquisition;

 

(e)                                  no more than three (3) Permitted
Acquisitions shall be completed in a fiscal year of the Credit Parties;

 

(f)                                   at any time the Total Leverage Ratio is
greater than 2.25 to 1.0 on a pro forma basis after giving effect to a proposed
Acquisition, the Total Consideration for Permitted Acquisitions shall not exceed
$50,000,000 for any one Permitted Acquisition or $100,000,000 in the aggregate
for all Permitted Acquisitions during the term of the Credit Agreement;

 

(g)                                  the proposed Acquired Business must have
generated zero or positive EBITDA (with adjustments limited to shareholder
distributions, owners’ compensation and pro forma cost structure/headcount
adjustments and other adjustments as may be agreed by Agent and Borrower
Representative) in the preceding year;

 

(h)                                 after giving effect to the proposed
Acquisition, Borrowers shall have pro forma Revolving Loan Availability of at
least $10,000,000;

 

(i)                                     the Acquired Business is in the same or
similar line of business as Borrowers and has its primary operations in the
United States (and, if an entity is being acquired, such entity is organized
under the laws of a state of the United States);

 

(j)                                    the Permitted Acquisition shall not be a
Hostile Acquisition;

 

(k)                                 contemporaneously with the closing of such
Permitted Acquisition, Agent shall be granted a first priority perfected
security interest (subject to Permitted Liens) in all assets of the Acquired
Business and, if any entity is to be acquired, to the extent required by this
Agreement (i) the Equity Interests of such Acquired Business shall be pledged to
Agent, (ii) such entity shall become a Guarantor or Borrower (as determined by
Agent), and (iii) such entity shall execute and deliver to Agent a joinder
agreement to this Agreement and the Security Agreement and such other documents
and instruments as reasonably required by Agent and the Lenders; and

 

(l)                                     Borrower Representative shall certify
the satisfaction of the foregoing conditions on or prior to the date such
Acquisition is consummated.

 

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

 

“Permitted Lien” is defined in Section 6.12 hereof.

 

“Permitted Refinancing Indebtedness” means, with respect to any Indebtedness,
any extensions, renewals or refinancing of any such Indebtedness (as used in the
definition, the refinancing Indebtedness); provided, that (a) the principal
amount of such Indebtedness is not increased at the time of extension, renewal
or refinancing except by an amount equal to a reasonable premium or other
reasonable amount paid, and fees and expenses reasonably incurred, in connection
with such refinancing and by an amount equal to any existing commitments
unutilized thereunder; (b) the refinancing Indebtedness is on the whole and in
all material respects on terms no less favorable (as adjusted for current market
conditions) to the Credit Parties than such Indebtedness; (c) the weighted
average life to maturity of the refinancing Indebtedness is greater than the
weighted average life to maturity of such Indebtedness; (d) if such Indebtedness
is (i) Subordinated Debt, the refinancing Indebtedness is subordinated to the
Obligations to the same extent that such Indebtedness is subordinated to the
Obligations; or (ii) unsecured, such refinancing Indebtedness shall be
unsecured; and (e) the refinancing Indebtedness is incurred by the same Person
or Persons (or their successor(s)) that initially incurred (including, without
limitation, by Guaranty) such Indebtedness.

 

“Permitted Tax Distributions” means, for so long as any Borrower (i) is treated
as a disregarded entity of which Holdings is the sole owner for U.S. federal
income tax purposes or (ii) is a corporation that files consolidated, combined,
unitary or similar tax returns with Holdings for U.S. federal (or state and
local) income tax purposes, cash distributions by such Borrower to Holdings in
amounts sufficient to permit Holdings to pay federal, state and local income
taxes (including estimated taxes) then due and payable, to the extent such taxes
are attributable to income or gain of such Borrower or any Subsidiary of such
Borrower.

 

“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 covered by Title IV of ERISA or
subject to the minimum funding standards under Section 412 of the Code that
either (a) is maintained by a member of the Controlled Group for employees of a
member of the Controlled Group or (b) is a Multiemployer Plan (as defined in
Section 4001(a)(3) of ERISA) or any other arrangement under which more than one
employer makes contributions and to which a member of the Controlled Group is
then making or accruing an obligation to make contributions or has within the
preceding five (5) plan years made contributions.

 

“Post-Closing Agreement” means that certain Post-Closing Agreement between the
Credit Parties and Agent dated as of the Second Restatement Closing Date.

 

“Premises” means the real property owned or leased by any Credit Party or any
Subsidiary, including, without limitation, the real property and improvements
thereon owned by any Credit Party or any Subsidiary subject to the Lien of the
Mortgages or any other Collateral Documents.

 

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“Proceeding” is defined in Section 10.08(g) hereof.

 

“Property” means, as to any Person, all types of real, personal, tangible,
intangible or mixed property owned by such Person whether or not included in the
most recent balance sheet of such Person and its Subsidiaries under GAAP.

 

“Qualified ECP Guarantor” shall mean, in respect of any Swap Obligation, each
Credit Party that has total assets exceeding $10,000,000 at the time such Swap
Obligation is incurred or such other Person as constitutes an “eligible contract
participant” under the Commodity Exchange Act or any regulations promulgated
thereunder and can cause another Person to qualify as an “eligible contract
participant” at such time by entering into a keepwell, support or other
agreement as contemplated by Section 1a(18)(A)(v)(II) of the Commodity Exchange
Act.

 

“Rate Management Agreement” means any agreement, device or arrangement providing
for payments which are related to fluctuations of interest rates, exchange
rates, forward rates, or equity prices, including, but not limited to,
dollar-denominated or cross-currency interest rate exchange agreements, forward
currency exchange agreements, interest rate cap or collar protection agreements,
forward rate currency or interest rate options, puts and warrants, and any
agreement pertaining to equity derivative transactions (e.g., equity or equity
index swaps, options, caps, floors, collars and forwards), including without
limitation any ISDA Master Agreement between the Credit Parties (or any one or
more of them) and Agent, any Lender, or any Affiliate of Agent or any Lender,
and any schedules, confirmations and documents and other confirming evidence
between the parties confirming transactions thereunder, all whether now existing
or hereafter arising, and in each case as amended, modified or supplemented from
time to time.

 

“Rate Management Obligations” means any and all obligations of any Borrower to
Agent, any Lender, or any Affiliate of Agent or any Lender, whether absolute,
contingent or otherwise and howsoever and whensoever (whether now or hereafter)
created, arising, evidenced or acquired (including all renewals, extensions and
modifications thereof and substitutions therefor), under or in connection with
(i) any and all Rate Management Agreements, and (ii) any and all cancellations,
buy-backs, reversals, terminations or assignments of any Rate Management
Agreement.

 

“RCRA” means the Solid Waste Disposal Act, as amended by the Resource
Conservation and Recovery Act of 1976 and Hazardous and Solid Waste Amendments
of 1984, 42 U.S.C. §§6901 et seq., and any future amendments.

 

“Recipient” means (a) the Agent, (b) any Lender and (c) any L/C Issuer, as
applicable.

 

“Register” is defined in Section 10.8(c) hereof.

 

“Reimbursement Obligation” is defined in Section 2.3(c) hereof.

 

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

 

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“Release” shall mean any spilling, leaking, pumping, pouring, emitting,
emptying, discharging, injecting, escaping, leaching, dumping, disposing or
migration into the environment.

 

“Remittances” means all checks, drafts, money orders, electronic funds
transfers, and other items and all cash and other remittances of every kind due
any Borrower on its Accounts or other Collateral.

 

“Required Lenders” means, at any time, Lenders having Total Credit Exposures
representing more than 50% of the Total Credit Exposures of all Lenders;
provided, however, (a) if there are two (2) Lenders (not including Affiliated
Lenders), Required Lenders shall mean both Lenders, (b) if there are three
(3) Lenders (not including Affiliated Lenders), Required Lenders shall mean
Lenders (not including Affiliated Lenders) having Total Credit Exposures
representing at least 66 2/3% of the Total Credit Exposures of all Lenders, and
(c) Lenders that are Affiliates of one another shall be considered as one
Lender.  The Total Credit Exposure of any Defaulting Lender shall be disregarded
in determining Required Lenders at any time.

 

“Required Revolving Lenders” means, at any time, Revolving Lenders having Total
Credit Exposures representing more than 50% of the Total Credit Exposures of all
Revolving Lenders; provided, however, (a) if there are two (2) Revolving Lenders
(not including Affiliated Lenders), Required Lenders shall mean both Revolving
Lenders, (b) if there are three (3) Revolving Lenders (not including Affiliated
Lenders), Required Lenders shall mean Revolving Lenders (not including
Affiliated Lenders) having Total Credit Exposures representing at least 66 2/3%
of the Total Credit Exposures of all Revolving Lenders, and (c) Revolving
Lenders that are Affiliates of one another shall be considered as one Revolving
Lender.  The Total Credit Exposure of any Defaulting Lender shall be disregarded
in determining Required Revolving Lenders at any time.

 

“Reserve Percentage” means, for any Borrowing of Eurodollar Loans, the daily
average for the applicable Interest Period of the maximum rate, expressed as a
decimal, at which reserves (including, without limitation, any supplemental,
marginal, and emergency reserves) are imposed during such Interest Period by the
Board of Governors of the Federal Reserve System (or any successor) on
“eurocurrency liabilities”, as defined in such Board’s Regulation D (or in
respect of any other category of liabilities that includes deposits by reference
to which the interest rate on Eurodollar Loans is determined or any category of
extensions of credit or other assets that include loans by non-United States
offices of any Lender to United States residents), subject to any amendments of
such reserve requirement by such Board or its successor, taking into account any
transitional adjustments thereto.  For purposes of this definition, the
Eurodollar Loans shall be deemed to be “eurocurrency liabilities” as defined in
Regulation D without benefit or credit for any prorations, exemptions or offsets
under Regulation D.

 

“Responsible Officer” means each of the chief executive officer, the president,
the treasurer, the comptroller, the chief financial officer and principal
accounting officer of a Credit Party or Borrower Representative, as applicable,
or any other officer or individual having substantially the same authority and
responsibility.

 

“Restatement Closing Date” means March 13, 2015.

 

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“Restricted Payment” means (a) any dividend or other distribution, direct or
indirect, on account of any shares (or equivalent) of any class of capital stock
or other Equity Interest of any Credit Party or any of its Subsidiaries, now or
hereafter outstanding, (b) any redemption, retirement, sinking fund or similar
payment, purchase or other acquisition for value, direct or indirect, of any
shares (or equivalent) of any class of capital stock or other Equity Interest of
any Credit Party or any of its Subsidiaries, now or hereafter outstanding,
(c) any payment made to retire, or to obtain the surrender of, any outstanding
warrants, options or other rights to acquire shares of any class of capital
stock or other Equity Interest of any Credit Party or any of its Subsidiaries,
now or hereafter outstanding, (d) any payment or prepayment of principal of,
premium, if any, or interest on, redemption, purchase, retirement, defeasance,
sinking fund or similar payment with respect to, any Subordinated Debt (if any)
of any Credit Party or any of its Subsidiaries, (e) any payment from any Credit
Party to an owner of its Equity Interests not expressly permitted by
Section 6.15, and (f) the payment by any Credit Party or any of its Subsidiaries
of any management, advisory or consulting fee to any Person or the payment of
any extraordinary salary, bonus or other form of compensation to any Person who
is directly or indirectly a significant partner, shareholder, owner or executive
officer of any such Person, including, without limitation, pursuant to any
management fee agreements.

 

“Revolving Credit” means the credit facility for making Revolving Loans, and
Swing Loans and issuing Letters of Credit described in Sections 2.2, 2.3 and
2.11 hereof.

 

“Revolving Credit Commitment” means, as to any Lender, the obligation of such
Lender to make Revolving Loans and to participate in Swing Loans and Letters of
Credit issued for the account of Borrowers hereunder in an aggregate principal
or face amount at any one time outstanding not to exceed the amount set forth
opposite such Lender’s name on Schedule 1 attached hereto and made a part
hereof, as the same may be reduced, increased or otherwise modified at any time
or from time to time pursuant to the terms hereof.  Borrowers and the Lenders
acknowledge and agree that the Revolving Credit Commitments of the Lenders
aggregate $30,000,000 on the Second Restatement Closing Date.

 

“Revolving Credit Exposure” means, as to any Revolving Lender at any time, the
aggregate principal amount at such time of its outstanding Revolving Loans and
such Revolving Lender’s participation in L/C Obligations and Swing Loans at such
time.

 

“Revolving Credit Termination Date” means the Maturity Date or such earlier date
on which the Revolving Credit Commitments are terminated in whole pursuant to
Section 2.10, 7.2 or 7.3 hereof.

 

“Revolving Lender” means, as of any date of determination, a Lender with a
Revolving Credit Commitment or, if the Revolving Credit Commitments have
terminated or expired, a Lender with Revolving Credit Exposure

 

“Revolving Loan” is defined in Section 2.2 hereof and, as so defined, includes a
Base Rate Loan or a Eurodollar Loan, each of which is a “type” of Revolving Loan
hereunder.

 

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“Revolving Loan Availability” means, as at any time, an amount, in Dollars,
equal to:

 

(a)                                 an amount equal to the lesser of:  (i) the
then existing Revolving Loan Limit based upon the most recent Compliance
Certificate and (ii) the then effective total Revolving Credit Commitment;

 

less                             (b)                                 the
aggregate outstanding principal amount of all Revolving Loans and Swing Loans;
and

 

less                             (c)                                  the then
existing L/C Obligations.

 

“Revolving Loan Limit” means, as of any date of calculation, the product of
(a) EBITDA multiplied by (b) the Applicable Advance Multiple as of such date. 
For purposes of calculating the Revolving Loan Limit as of any date of
calculation, EBITDA shall be calculated for the twelve (12) month period ending
on the date most recently ended for which financial statements described in
Section 6.1(b) of the Credit Parties and their Subsidiaries on a consolidated
basis were delivered to Agent.

 

“Revolving Note” is defined in Section 2.12(d) hereof.

 

“S&P” means Standard & Poor’s Ratings Services Group, a division of The
McGraw-Hill Companies, Inc.

 

“Sales Administration” means MasterCraft International Sales
Administration, Inc., a Delaware corporation.

 

“Sanctioned Entity” means (a) a country or a government of a country, (b) an
agency of the government of a country, (c) an organization directly or
indirectly controlled by a country or its government, (d) a Person resident in
or determined to be resident in a country, in each case, that is subject to a
country sanctions program administered and enforced by OFAC.

 

“Sanctioned Person” means a person named on the OFAC-maintained list of
“Specially Designated Nationals” (as defined by OFAC).

 

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

 

“Second Restatement Closing Date” means May 27, 2016.

 

“Second Restatement Dividend” is defined in Section 5.7 hereof.

 

“Security Agreement” means the Existing Security Agreement, as the same may be
amended, modified, supplemented or restated from time to time, including as of
the Second Restatement Closing Date.

 

“Senior Funded Debt” means, at any time the same is to be determined, the
aggregate of all Indebtedness of the Credit Parties and their Subsidiaries at
such time determined on a consolidated basis in accordance with GAAP other than
(i) Subordinated Debt of the Credit Parties and their Subsidiaries, and
(ii) Floorplan Repurchase Obligations, as of such date.

 

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“Senior Leverage Ratio” means, as of the date of determination thereof, the
ratio of (a) Senior Funded Debt as of such date to (b) EBITDA for the period of
four fiscal quarters then ended.

 

“Services” means MasterCraft Services, Inc., a Tennessee corporation, a
Subsidiary of MasterCraft, and a Borrower hereunder.

 

“Settlement” is defined in Section 2.11(d) hereof.

 

“Settlement Date” is defined in Section 2.11(d) hereof.

 

“Sponsor” means Wayzata Investment Partners LLC, a Delaware limited liability
company.

 

“Sponsor Entities” means, individually and collectively, each Affiliate of
Sponsor.

 

“Subordinated Debt” shall mean, collectively, all Indebtedness of any Credit
Party or any Subsidiary that is subordinated to the Obligations pursuant to a
Subordination Agreement or the terms thereof in a manner reasonably satisfactory
to the Required Lenders, and contains terms, including, without limitation,
payment terms, reasonably satisfactory to the Agent.

 

“Subordinated Debt Documents” shall mean, collectively, any and all instruments,
documents and agreements executed and/or delivered in connection with any
Subordinated Debt, in each case as amended, restated, supplemented or otherwise
modified from time to time in accordance with the terms of the applicable
Subordination Agreement.

 

“Subordination Agreements” shall mean, individually and collectively, all
subordination agreements, intercreditor agreements, consent and similar
agreements among any Credit Party, the Agent or any Lender and any holder of
Indebtedness, whether entered into on or prior to the date hereof or from time
to time hereafter, together with all modifications, amendments and restatements
of any of the foregoing.

 

“Subsidiary” means, as to any particular parent corporation or organization, any
other corporation or organization more than 50% of the outstanding Voting Stock
of which is at the time directly or indirectly owned by such parent corporation
or organization or by any one or more other entities which are themselves
subsidiaries of such parent corporation or organization.  Unless the context
otherwise requires, the term “Subsidiary” means a Subsidiary of any Borrower and
any direct or indirect Subsidiaries of any of the foregoing.

 

“Swap Obligation” means any Rate Management Obligation that constitutes a “swap”
within the meaning of section 1a(47) of the Commodity Exchange Act, as amended
from time to time.

 

“Swing Line” means the credit facility for making one or more Swing Loans
described in Section 2.11 hereof.

 

“Swing Line Lender” means Fifth Third, in its capacity as lender of Swing Loans
hereunder and any successor Swing Line Lender hereunder.

 

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“Swing Line Sublimit” means $10,000,000, as reduced pursuant to the terms
hereof.

 

“Swing Loan” and “Swing Loans” each is defined in Section 2.11 hereof.

 

“Swing Note” is defined in Section 2.12(d) hereof.

 

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

 

“Term Credit” means the credit facility for the Term Loans described in
Section 2.1(a) hereof.

 

“Term Lender” means, as of any date of determination, a Lender with a Term Loan
Commitment.

 

“Term Loan” is defined in Section 2.1 hereof and, as so defined, includes aBase
Rate Loan or a Eurodollar Loan as permitted hereunder, each of which is a “type”
of Loan hereunder.

 

“Term Loan Commitment” means, as to any Term Lender, the obligation of such
Lender to make its Term Loan on the Second Restatement Closing Date, in the
principal amount not to exceed the amount set forth opposite such Lender’s name
on Schedule 1 attached hereto and made a part hereof, as of such date.  The Term
Loan Commitments of the Term Lenders aggregate $50,000,000 as of the Second
Restatement Closing Date. After advancing the Term Loan, each reference to a
Term Loan Commitment of a Term Lender shall refer to such Term Lender’s Term
Loan Percentage.

 

“Term Loan Funding Date” is defined in Section 2.1 hereof.

 

“Term Loan Notice of Borrowing” is defined in Section 2.1 hereof.

 

“Term Loan Percentage” means, for each Term Lender, the percentage of the Term
Loan Commitments represented by such Term Lender’s Term Loan Commitment or, if
the Term Loan Commitments have been terminated or have expired, the percentage
held by such Term Lender of the aggregate principal amount of all Term Loans
then outstanding.

 

“Term Note” is defined in Section 2.12 hereof.

 

“Total Consideration” means, with respect to an Acquisition, the total sum (but
without duplication) of (a) cash paid (or to be paid as an earn-out) in
connection with any Acquisition, plus (b) indebtedness payable to the seller in
connection with such Acquisition, plus (c) the fair market value of any Equity
Interests, including any warrants or options therefor, delivered in connection
with any Acquisition, plus (d) the amount of indebtedness assumed in connection
with such Acquisition.

 

“Total Credit Exposure” means, as to any Lender at any time, the Unused
Revolving Credit Commitments, Revolving Credit Exposure and outstanding Term
Loans of such Lender at such time.

 

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“Total Funded Debt” means, at any time the same is to be determined, the
aggregate of all Indebtedness of the Credit Parties and their Subsidiaries at
such time (other than Floorplan Repurchase Obligations) determined on a
consolidated basis in accordance with GAAP.

 

“Total Leverage Ratio” means, as of the date of determination thereof, the ratio
of (a) Total Funded Debt to (b) EBITDA for the period of four fiscal quarters
then ended.

 

“UCC” is defined in Section 1.2 hereof.

 

“United States” and “U.S.” means United States of America.

 

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

 

“Unused Revolving Credit Commitments” means, at any time, the difference between
the Revolving Credit Commitments then in effect and the aggregate outstanding
principal amount of Revolving Loans and L/C Obligations; provided that Swing
Loans outstanding from time to time shall be deemed to reduce the Unused
Revolving Credit Commitment of the Agent (but for the avoidance of doubt, no
other Lender) for purposes of computing the Commitment Fee under
Section 2.13(a) hereof.

 

“U.S. Borrower” means any Borrower that is a U.S. Person.

 

“U.S. Person” means any Person that is a “United States person” as defined in
Section 7701(a)(30) of the Code.

 

“U.S. Tax Compliance Certificate” has the meaning assigned to such term in
Section 8.5(g)(ii)(B)(iii).

 

“Voting Stock” of any Person means capital stock or other Equity Interests of
any class or classes (however designated) having ordinary power for the election
of directors or other similar governing body of such Person (including, without
limitation, general partners of a partnership), other than stock or other Equity
Interests having such power only by reason of the happening of a contingency.

 

“Wholly-Owned Subsidiary” means, at any time, any Subsidiary of which all of the
issued and outstanding shares of capital stock (other than directors’ qualifying
shares as required by law) or other Equity Interests are owned by any one or
more of Holdings and Holdings’ other Wholly-Owned Subsidiaries at such time.

 

“Withholding Agent” means any Credit Party and the Agent.

 

Section 1.2                                    Interpretation.  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,”

 

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“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
shall be construed as referring to such agreement, instrument or other document
as from time to time amended, supplemented or otherwise modified (subject to any
restrictions on such amendments, supplements or modifications set forth herein),
(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, (e) any reference to any law or regulation herein shall, unless
otherwise specified, refer to such law or regulation as amended, modified or
supplemented from time to time, and (f) the words “asset” and “property” shall
be construed to have the same meaning and effect and to refer to any and all
tangible and intangible assets and properties, including cash, securities,
accounts and contract rights.  All references to time of day herein are
references to Cincinnati, Ohio, time unless otherwise specifically provided. 
Where the character or amount of any asset or liability or item of income or
expense is required to be determined or any consolidation or other accounting
computation is required to be made for the purposes of this Agreement, it shall
be done in accordance with GAAP except where such principles are inconsistent
with the specific provisions of this Agreement.  All terms that are used in this
Agreement without definition and which are defined in the Uniform Commercial
Code of the State of Illinois as in effect from time to time (“UCC”) shall have
the same meanings herein as such terms are defined in the UCC, unless this
Agreement shall otherwise specifically provide.

 

Section 1.3                                    Change in Accounting Principles. 
All accounting terms not specifically or completely defined herein shall be
construed in conformity with, and all financial data required to be submitted
pursuant to this Agreement shall be prepared in conformity with, GAAP, as in
effect from time to time.  If, after the date of this Agreement, there shall
occur any change in GAAP from those used in the preparation of the financial
statements referred to in Section 5.3 hereof and such change shall result in a
change in the method of calculation of any financial covenant, standard or term
found in this Agreement, either Borrower Representative, Agent or the Required
Lenders may by notice to the Lenders, Agent and Borrower Representative,
respectively, require that the Lenders, Agent and Borrower Representative
negotiate in good faith to amend such covenants, standards, and term so as
equitably to reflect such change in accounting principles, with the desired
result being that the criteria for evaluating the financial condition of Credit
Parties and their Subsidiaries shall be the same as if such change had not been
made.  No delay by Borrower Representative, Agent or the Required Lenders in
requiring such negotiation shall limit their right to so require such a
negotiation at any time after such a change in accounting principles.  Until any
such covenant, standard, or term is amended in accordance with this Section 1.3,
financial covenants shall be computed and determined in accordance with GAAP in
effect prior to such change in accounting principles.  Without limiting the
generality of the foregoing, Credit Parties shall neither be deemed to be in
compliance with any financial covenant hereunder nor out of compliance with any
financial covenant hereunder if such state of compliance or noncompliance, as
the case may be, would not exist but for the occurrence of a change in
accounting principles after the date hereof.  Notwithstanding any other
provision contained herein, all terms of an accounting or financial nature used
herein shall be

 

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construed, and all computations of amounts and ratios referred to herein shall
be made, without giving effect to any election under Statement of Financial
Accounting Standards 159 (Codification of Accounting Standards 825-10) to value
any Indebtedness or other liabilities of any Credit Party or any Subsidiary at
“fair value”, as defined therein.  If at any time after the Second Restatement
Closing Date, any obligations of the Credit Parties that would not have
constituted Indebtedness as of the Second Restatement Closing Date are
re-characterized as Indebtedness in accordance with any relevant changes in
GAAP, such re-characterized obligations shall not be considered Indebtedness for
all purposes hereunder.

 

Section 1.4                                    Financial Covenant Calculations. 
The parties hereto acknowledge and agree that, for purposes of all calculations
made in determining compliance for any applicable period with the financial
covenants set forth in Section 6.7 and for purposes of determining the
Applicable Margin, (i) after consummation of any Permitted Acquisition,
(A) income statement items and other balance sheet items (whether positive or
negative) attributable to the target acquired in such transaction shall be
included in such calculations to the extent relating to such applicable period
(including by adding any cost saving synergies associated with such Permitted
Acquisition in a manner reasonably satisfactory to the Agent), subject to
adjustments mutually acceptable to Borrowers and the Agent and (B) Indebtedness
of a target which is retired in connection with a Permitted Acquisition shall be
excluded from such calculations and deemed to have been retired as of the first
day of such applicable period and (ii) after any Disposition permitted by
Section 6.8), (A) income statement items, cash flow statement items and balance
sheet items (whether positive or negative) attributable to the property or
assets disposed of shall be excluded in such calculations to the extent relating
to such applicable period, subject to adjustments mutually acceptable to
Borrowers and the Agent and (B) Indebtedness that is repaid with the proceeds of
such Disposition shall be excluded from such calculations and deemed to have
been repaid as of the first day of such applicable period.

 

Section 1.5                                    Outstanding Obligations.  Each of
the Credit Parties acknowledges and confirms that as of the Second Restatement
Closing Date, Borrowers are indebted to the Lenders without defense, set-off or
counter-claim under the Existing Credit Agreement in the principal amount of
(i) $0.00 in respect of the Term Loan under the Existing Credit Agreement (the
“Outstanding Term Loan”), and (ii) $0.00, the amount of the Revolving Loans
under the Existing Credit Agreement (the “Outstanding Revolving Loans” and
together with the Outstanding Term Loan, the “Outstanding Indebtedness”).  This
Agreement amends and restates the Existing Credit Agreement, and the Outstanding
Indebtedness shall be deemed to constitute a Loan hereunder.  The execution and
delivery of this Agreement and the other Loan Documents, however, does not
evidence or represent a refinancing, repayment, accord and/or satisfaction or
novation of the Outstanding Indebtedness.  All of Lenders’ obligations to
Borrowers with respect to Loans to be made concurrently herewith (including the
Outstanding Indebtedness, which is deemed to have been made on the Second
Restatement Closing Date) or after the date hereof are set forth in this
Agreement.  All Liens and security interests previously granted to Agent, for
the benefit of itself and the Lenders, pursuant to the Original Loan Agreement
and the Existing Credit Agreement and/or the loan documents entered into in
connection therewith, as applicable, are acknowledged and reconfirmed and remain
in full force and effect and are not intended to be released, replaced or
impaired.

 

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SECTION 2

 

THE CREDIT FACILITIES.

 

Section 2.1                                    Term Loan Commitments.  Each Term
Lender severally and not jointly agrees, subject to the terms and conditions
hereof, to make a loan (each individually a “Term Loan” and, collectively, the
“Term Loans”) in Dollars to Borrowers in the amount of such Lender’s Term Loan
Commitment.  The Term Loan shall be advanced in a single Borrowing on a date
requested in writing by Borrower Representative, which date shall be within
thirty (30) days after the Second Restatement Closing Date (the “Term Loan
Funding Date”), by delivery to Agent, at least three (3) Business Days prior to
the requested Term Loan Funding Date, of (i) a Notice of Borrowing,
substantially in the form of Exhibit B attached to this Agreement, that, in
addition to the other certifications set forth in the Exhibit B Notice of
Borrowing (“Term Loan Notice of Borrowing”), certifies to Agent and the Lenders
that all of the conditions set forth in Section 3.2 (Credit Event — Restatement
Closing Date and Term Loan Funding Date) of this Agreement are satisfied as of
the Term Loan Funding Date, and (ii) a fully executed Term Note dated as of the
Term Loan Funding Date.  As provided in Section 2.5(a), and subject to the terms
hereof, Borrowers may elect that all or any part of the Term Loan be outstanding
as Base Rate Loans or Eurodollar Loans.  No amount of the Term Loan may be
reborrowed once it is repaid.

 

Section 2.2                                    Revolving Credit Commitments. 
Any Outstanding Revolving Loans shall be deemed to constitute an initial
Revolving Loan on the Second Restatement Closing Date and thereupon, the
Revolving Lenders shall purchase and sell outstanding Revolving Loans among
themselves such that after giving effect to such sales, the Revolving Loans held
by each Revolving Lender equals its Applicable Percentage for Revolving Loans.
Prior to the Revolving Credit Termination Date, each Revolving Lender severally
and not jointly agrees, subject to the terms and conditions hereof, to make
revolving loans (each individually a “Revolving Loan” and, collectively, the
“Revolving Loans”) in Dollars to Borrowers from time to time up to the amount of
such Lender’s Revolving Credit Commitment in effect at such time; provided,
however, that no such Revolving Loan shall result in (a) such Lender’s Revolving
Credit Exposure exceeding such Lender’s Revolving Credit Commitment or (b) the
aggregate Revolving Credit Exposures of all Revolving Lenders exceeding the
lesser of (x) the total Revolving Credit Commitments and (y) the Revolving Loan
Limit. Subject to the terms and conditions of this Agreement, Revolving Loans
shall be made against the Revolving Loan Limit, subject to the provisions of
Section 2.11(b) (Overadvances).  The Revolving Loan Limit shall be determined by
Agent based upon the EBITDA of the Credit Parties as set forth on the most
recent Compliance Certificate delivered to Agent in accordance with
Section 6.1(d) hereof and such other information as may be available to Agent. 
If at any time the outstanding Revolving Loans exceed either the Revolving Loan
Limit or the aggregate Revolving Credit Commitments, the outstanding L/C
Obligations and the outstanding Swing Loans, Borrowers shall immediately, and
without the necessity of demand by Agent, pay to Agent such amount as may be
necessary to eliminate such excess and Agent shall apply such payment as follows
(i) to any outstanding Swing Loans and Overadvances until paid in full, (ii) to
outstanding Revolving Loans until paid in full, and (iii) to Cash Collateralize
outstanding L/C Obligations.  Each Borrowing of Revolving Loans shall be made
ratably by the Revolving Lenders in proportion to their respective Applicable
Percentages. As provided in Section 2.5(a), and subject to the terms hereof,
Borrower Representative may elect that each Borrowing of Revolving Loans be
either

 

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Base Rate Loans or Eurodollar Loans, provided that Revolving Loans that are
Eurodollar Loans shall bear interest based upon a one (1) month Interest Period,
floating from month to month, unless otherwise agreed by Agent and Borrower
Representative.  Revolving Loans may be repaid and reborrowed before the
Revolving Credit Termination Date, subject to the terms and conditions thereof.

 

Section 2.3                                    Letters of Credit.

 

(a)                                 General Terms.  Subject to the terms and
conditions hereof, as part of the Revolving Credit, the L/C Issuer shall issue
commercial and standby letters of credit (each a “Letter of Credit”) for the
account of Borrowers’ in an aggregate undrawn face amount up to the L/C
Sublimit; provided, however, no such Letter of Credit shall result in (a) such
Lender’s Revolving Credit Exposure exceeding such Lender’s Revolving Credit
Commitment or (b) the aggregate Revolving Credit Exposures of all Lenders
exceeding the lesser of (x) the total Revolving Credit Commitments and (y)  the
Revolving Loan Limit.  Each Lender shall be obligated to reimburse the L/C
Issuer for such Lender’s Applicable Percentage of the amount of each drawing
under a Letter of Credit and, accordingly, each Letter of Credit shall
constitute usage of the Revolving Credit Commitment of each Lender pro rata in
an amount equal to its Applicable Percentage of the L/C Obligations then
outstanding.

 

(b)                                 Applications.  At any time before the
Revolving Credit Termination Date, the L/C Issuer shall, at the request of
Borrower Representative, issue one or more Letters of Credit in Dollars, in form
and substance acceptable to the L/C Issuer, with expiration dates no later than
the earlier of (i) 12 months from the date of issuance (or which are cancelable
not later than 12 months from the date of issuance and each renewal), or
(ii) the Revolving Credit Termination Date, in an aggregate face amount as set
forth above, upon the receipt of a duly executed application for the relevant
Letter of Credit in the form then customarily prescribed by the L/C Issuer for
the Letter of Credit requested (each an “Application”), provided that any Letter
of Credit may provide by its terms for the automatic renewal thereof for
additional 12 month periods, but in no event beyond the Maturity Date unless
such Letter of Credit is Cash Collateralized in an amount equal to 103% of the
L/C Obligations pursuant to documentation reasonably satisfactory to the Agent
in which case such Letter of Credit shall expire no later than the date that is
15 days prior to the first anniversary of the Revolving Credit Termination
Date.  If any Letter of Credit when issued would extend beyond the Maturity
Date, Borrowers shall deliver to the Agent on the date such Letter of Credit is
issued, Cash Collateral in an amount equal to 103% of the L/C Obligations
pursuant to documentation reasonably satisfactory to the Agent and any L/C
Issuer if not the Agent.  Notwithstanding anything contained in any Application
to the contrary:  (x) Borrowers shall pay fees in connection with each Letter of
Credit as set forth in Section 2.13(b) hereof, and (y) if the L/C Issuer is not
timely reimbursed for the amount of any drawing under a Letter of Credit on the
date such drawing is paid, Borrowers’ obligation to reimburse such L/C Issuer
for the amount of such drawing shall bear interest (which each Borrower hereby
promises to pay) from and after the date such drawing is paid at a rate per
annum equal to the sum of 2.0% plus the Applicable Margin plus the Base Rate
from time to time in effect (computed on the basis of a year of 365 or 366 days,
as the case may be, and the actual number of days elapsed).  Without limiting
the foregoing, the L/C Issuer’s obligation to issue, amend or extend the
expiration date of a Letter of Credit is subject to the

 

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terms or conditions of this Agreement (including the conditions set forth in
Section 3.1 and the other terms of this Section 2.3).

 

(c)                                  The Reimbursement Obligations.  Subject to
Section 2.3(b) hereof, the obligation of Borrowers to reimburse the L/C Issuer
for all drawings under a Letter of Credit (a “Reimbursement Obligation”) shall
be governed by the Application related to such Letter of Credit and this
Agreement, except that reimbursement shall be made on the date when each drawing
is to be paid if Borrower Representative has been informed of such drawing by
such L/C Issuer on or before 11:00 a.m. (Eastern time) on the date when such
drawing is to be paid or, if notice of such drawing is given to Borrower
Representative after 11:00 a.m. (Eastern time) on the date when such drawing is
to be paid, by the next succeeding Business Day, in immediately available funds
at the Agent’s principal office in Cincinnati, Ohio or such other office as the
Agent may designate in writing to Borrower Representative, and the Agent shall
thereafter cause to be distributed to such L/C Issuer such amount(s) in like
funds; provided that Borrower Representative shall be deemed to have requested,
subject to the conditions to borrowing set forth in this Agreement, that such
Reimbursement Obligation be financed with a Base Rate Revolving Loan in an
equivalent amount and, to the extent so financed, Borrowers’ obligation to make
such payment shall be discharged and replaced by the resulting Base Rate
Revolving Loan; provided that Borrower Representative shall be deemed to have
requested, subject to the conditions to borrowing set forth in this Agreement,
that such Reimbursement Obligation be financed with a Base Rate Revolving Loan
in an equivalent amount and, to the extent so financed, Borrowers’ obligation to
make such payment shall be discharged and replaced by the resulting Base Rate
Revolving Loan.  If Borrowers do not make any such reimbursement payment on the
date due and the Participating Lenders fund their participations in the manner
set forth in Section 2.3(d) below, then all payments thereafter received by the
Agent in discharge of any of the relevant Reimbursement Obligations shall be
distributed in accordance with Section 2.3(d) below.  In addition, for the
benefit of the Agent, the L/C Issuer and each Lender, each Borrower agrees that,
notwithstanding any provision of any Application, its obligations under this
Section 2.3(c) and each Application shall be absolute, unconditional and
irrevocable, and shall be performed strictly in accordance with the terms of
this Agreement and the Applications, under all circumstances whatsoever,
including without limitation (i) any lack of validity or enforceability of any
Loan Document; (ii) any amendment or waiver of or any consent to departure from
all or any of the provisions of any Loan Document; (iii) the existence of any
claim, set-off, defense or other right any Borrower may have at any time against
a beneficiary of a Letter of Credit (or any Person for whom a beneficiary may be
acting), the Agent, any L/C Issuer, any Lender or any other Person, whether in
connection with this Agreement, another Loan Document, the transaction related
to the Loan Document or any unrelated transaction; (iv) any statement or any
other document presented under a Letter of Credit proving to be forged,
fraudulent, invalid or insufficient in any respect or any statement therein
being untrue or inaccurate in any respect; (v) payment by the Agent or a L/C
Issuer under a Letter of Credit against presentation to the Agent or a L/C
Issuer of a draft or certificate that does not comply with the terms of the
Letter of Credit, provided that the Agent’s or L/C Issuer’s determination that
documents presented under the Letter of Credit comply with the terms thereof did
not constitute gross negligence or willful misconduct of the Agent or L/C
Issuer; or (vi) any other act or omission to act or delay of any kind by the
Agent or a L/C Issuer, any Lender or any other Person or any other event or
circumstance whatsoever that might, but for the provisions of this
Section 2.3(c), constitute a legal or equitable discharge of any Borrower’s
obligations

 

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hereunder or under an Application; provided that the foregoing shall not be
construed to excuse any L/C Issuer from liability to any Borrower to the extent
of any direct damages (as opposed to consequential damages, claims in respect of
which are hereby waived by each Credit Party to the extent permitted by
applicable law) suffered by any Credit Party that are caused by such L/C
Issuer’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 bad faith, gross
negligence or willful misconduct on the part of the L/C Issuer (as determined by
a final non-appealable decision of a court of competent jurisdiction), such L/C
Issuer shall be deemed to have exercised care in each such determination.  In
furtherance of the foregoing and without limiting the generality thereof, the
parties agree that, with respect to documents presented which appear on their
face to be in substantial compliance with the terms of a Letter of Credit, the
L/C Issuer 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.

 

(d)                                 The Participating Interests.  Each Lender
(other than the Lender acting as L/C Issuer) severally and not jointly agrees to
purchase from the L/C Issuer, and such L/C Issuer hereby agrees to sell to each
such Lender (a “Participating Lender”), an undivided participating interest (a
“Participating Interest”) to the extent of its Applicable Percentage in each
Letter of Credit issued by, and each Reimbursement Obligation owed to, such L/C
Issuer.  Upon any Borrower’s failure to pay any Reimbursement Obligation on the
date and at the time required, or if any L/C Issuer is required at any time to
return to any Borrower or to a trustee, receiver, liquidator, custodian or other
Person any portion of any payment of any Reimbursement Obligation, each
Participating Lender shall, not later than the Business Day it receives a
certificate in the form of Exhibit A attached hereto from such L/C Issuer (with
a copy to the Agent) to such effect, if such certificate is received before
1:00 p.m. (Eastern time), or not later than 1:00 p.m. (Eastern time) the
following Business Day, if such certificate is received after such time, pay to
the Agent for the account of such L/C Issuer an amount equal to such
Participating Lender’s Applicable Percentage of such unpaid Reimbursement
Obligation together with interest on such amount accrued from the date such L/C
Issuer made the related payment to the date of such payment by such
Participating Lender at a rate per annum equal to:  (i) from the date such L/C
Issuer made the related payment to the date two (2) Business Days after payment
by such Participating Lender is due hereunder, the Federal Funds Rate for each
such day and (ii) from the date two (2) Business Days after the date such
payment is due from such Participating Lender to the date such payment is made
by such Participating Lender, the Base Rate in effect for each such day.  Each
such Participating Lender shall, after making its appropriate payment, be
entitled to receive its Applicable Percentage of each payment received in
respect of the relevant Reimbursement Obligation and of interest paid thereon,
with the L/C Issuer retaining its Applicable Percentage thereof as a Lender
hereunder.

 

The several obligations of the Participating Lenders to the L/C Issuers under
this Section 2.3 shall be absolute, irrevocable and unconditional under any and
all circumstances and shall not be subject to any set-off, counterclaim or
defense to payment which any Participating Lender may have or has had against
any Borrower, any L/C Issuer, the Agent, any Lender or any other Person. 
Without limiting the generality of the foregoing, such obligations shall not be
affected by any Default or Event of Default or by any reduction or termination
of the Revolving

 

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Credit Commitment of any Lender, and each payment by a Participating Lender
under this Section 2.3 shall be made without any offset, abatement, withholding
or reduction whatsoever.

 

(e)                                  Indemnification.  The Participating Lenders
shall, to the extent of their respective Applicable Percentages, indemnify the
L/C Issuer (to the extent not reimbursed by any Borrower) against any cost,
expense (including reasonable counsel fees and disbursements), claim, demand,
action, loss or liability (except such as result from such L/C Issuer’s gross
negligence or willful misconduct as determined by a final non-appealable
decision of a court of competent jurisdiction) that such L/C Issuer may suffer
or incur in connection with any Letter of Credit issued by it.  The obligations
of the Participating Lenders under this Section 2.3(e) and all other parts of
this Section 2.3 shall survive termination of this Agreement and of all
Applications, Letters of Credit, and all drafts and other documents presented in
connection with drawings thereunder.

 

(f)                                   Manner of Requesting a Letter of Credit. 
Borrower Representative shall provide at least three (3) Business Days’ advance
written notice to the Agent (or such lesser notice as the Agent and the L/C
Issuer may agree in their sole discretion) of each request for the issuance of a
Letter of Credit, each such notice to be accompanied by a properly completed and
executed Application for the requested Letter of Credit and, in the case of an
extension or amendment or an increase in the amount of a Letter of Credit, a
written request therefor, in a form acceptable to the Agent and the L/C Issuer,
in each case, together with the fees called for by this Agreement.  The Agent
shall promptly notify the L/C Issuer of the Agent’s receipt of each such notice
and such L/C Issuer shall promptly notify the Agent and the Lenders of the
issuance of a Letter of Credit.

 

Section 2.4                                    Applicable Interest Rates.

 

(a)                                 Base Rate Loans.  Each Base Rate Loan made
or maintained by a Lender shall bear interest (computed on the basis of a year
of 365 or 366 days, as the case may be, and the actual days elapsed) on the
unpaid principal amount thereof from the date such Loan is advanced or created
by conversion from a Eurodollar Loan until maturity (whether by acceleration or
otherwise) at a rate per annum equal to the sum of the Applicable Margin plus
the Base Rate from time to time in effect, payable in arrears on the last
Business Day of each month and at maturity (whether by acceleration or
otherwise).

 

(b)                                 Eurodollar Loans.  Each Eurodollar Loan made
or maintained by a Lender shall bear interest during each Interest Period it is
outstanding (computed on the basis of a year of 360 days and actual days
elapsed) on the unpaid principal amount thereof from the date such Loan is
advanced, continued or created by conversion from a Base Rate Loan until
maturity (whether by acceleration or otherwise) at a rate per annum equal to the
sum of the Applicable Margin plus the Adjusted LIBOR applicable for such
Interest Period, payable in arrears on the last day of the Interest Period and
at maturity (whether by acceleration or otherwise), provided that if the
applicable Interest Period is longer than three (3) months, interest shall be
payable on that day that is ninety (90)  days after the commencement of such
Interest Period.

 

(c)                                  Default Rate.  While any Event of Default
exists or after acceleration, Borrowers shall pay interest (after as well as
before entry of judgment thereon to the extent

 

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permitted by law) on the principal amount of all overdue amounts hereunder at a
rate per annum equal to:

 

(i)                                     for any Base Rate Loan (including any
Swing Loan), the sum of two percent (2.0%) per annum plus the Applicable Margin
plus the Base Rate from time to time in effect; and

 

(ii)                                  for any Eurodollar Loan, the sum of two
percent (2.0%) per annum plus the rate of interest in effect thereon at the time
of such default until the end of the Interest Period applicable thereto and,
thereafter, at a rate per annum equal to the sum of two percent (2.0%) plus the
Applicable Margin for Base Rate Loans plus the Base Rate from time to time in
effect;

 

provided, however, that in the absence of acceleration, any increase in interest
rates pursuant to this Section shall be made at the election of the Agent,
acting at the request or with the consent of the Required Lenders, with written
notice to Borrower Representative.  While any Event of Default exists or after
acceleration, accrued interest shall be paid on demand of the Agent at the
request or with the consent of the Required Lenders.

 

(d)                                 Rate Determinations.  The Agent shall
determine each interest rate applicable to the Loans and the Reimbursement
Obligations hereunder, and its determination thereof shall be conclusive and
binding except in the case of demonstrable error.

 

Section 2.5                                    Manner of Borrowing Loans and
Designating Applicable Interest Rates; Funding.

 

(a)                                 Notice to the Agent. Borrower Representative
shall give notice to the Agent by no later than 12:00 p.m. (Noon) (Eastern
time):  (x) at least three (3) Business Days before the date on which Borrower
Representative requests the Lenders to advance a Borrowing of Eurodollar Loans
and (y) on the date Borrower Representative requests the Lenders to advance a
Borrowing of Base Rate Loans.  The Loans included in each Borrowing shall bear
interest initially at the type of rate specified in such notice.  Thereafter,
with respect to all such Loans, Borrower Representative may from time to time
elect to change or continue the type of interest rate borne by each Borrowing
or, subject to Section 2.6 hereof, a portion thereof, as follows:  (i) if such
Borrowing is of Eurodollar Loans, on the last day of the Interest Period
applicable thereto, Borrower Representative may continue part or all of such
Borrowing as Eurodollar Loans or convert part or all of such Borrowing into Base
Rate Loans or (ii) if such Borrowing is of Base Rate Loans, on any Business Day,
Borrower Representative may convert all or part of such Borrowing into
Eurodollar Loans for an Interest Period or Interest Periods specified by
Borrower Representative.  Borrower Representative shall give all such notices
requesting the advance, continuation or conversion of a Borrowing to the Agent
by telephone or telecopy (which notice shall be irrevocable once given and, if
by telephone, shall be promptly confirmed in writing), substantially in the form
attached hereto as Exhibit B (Notice of Borrowing) or Exhibit C (Notice of
Continuation/Conversion), as applicable, or in such other form acceptable to the
Agent.  Notice of the continuation of a Borrowing of Eurodollar Loans for an
additional Interest Period or of the conversion of part or all of a Borrowing of
Base Rate Loans into Eurodollar Loans must be given by no later than
1:00 p.m. (Eastern time) at least

 

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three (3) Business Days before the date of the requested continuation or
conversion.  All notices concerning the advance, continuation or conversion of a
Borrowing shall specify the date of the requested advance, continuation or
conversion of a Borrowing (which shall be a Business Day), the amount of the
requested Borrowing to be advanced, continued or converted, the type of Loans to
comprise such new, continued or converted Borrowing and, if such Borrowing is to
be comprised of Eurodollar Loans, the Interest Period applicable thereto.  Each
Borrower agrees that the Agent may rely on any such telephonic or telecopy
notice given by any Person the Agent in good faith believes is an Authorized
Representative of Borrower Representative without the necessity of independent
investigation (each Borrower hereby indemnifies the Agent from any liability or
loss ensuing from such reliance other than any liability or loss incurred as a
result of Agent’s gross negligence or willful misconduct as determined by a
final non-appealable decision of a court of competent jurisdiction) and, in the
event any such notice by telephone conflicts with any written confirmation, such
telephonic notice shall govern if the Agent has acted in reliance thereon. 
Notwithstanding anything to the contrary set forth in this Agreement, Swing
Loans and Overadvances shall be Base Rate Loans and may not be converted or
continued.

 

(b)                                 Notice to the Lenders.  The Agent shall give
prompt telephonic or telecopy notice to each Lender of any notice from Borrower
Representative received pursuant to Section 2.5(a) above and, if such notice
requests the Lenders to make Eurodollar Loans, the Agent shall give notice to
Borrower Representative and each Lender of the interest rate applicable thereto
promptly after the Agent has made such determination.

 

(c)                                  Borrower Representative’s Failure to
Notify; Automatic Continuations and Conversions.  If Borrower Representative
fails to give proper notice of the continuation or conversion of any outstanding
Borrowing of Eurodollar Loans before the last day of its then current Interest
Period within the period required by Section 2.5(a) or, whether or not such
notice has been given, one or more of the conditions set forth in Section 3.1
for the continuation or conversion of a Borrowing of Eurodollar Loans would not
be satisfied, and such Borrowing is not prepaid in accordance with
Section 2.8(a), such Borrowing shall automatically be converted into a Borrowing
of Base Rate.  In the event Borrower Representative fails to give notice
pursuant to Section 2.5(a) of a Borrowing equal to the amount of a Reimbursement
Obligation and has not notified the Agent by 1:00 p.m. (Eastern time) on the day
such Reimbursement Obligation becomes due that it intends to repay such
Reimbursement Obligation through funds not borrowed under this Agreement,
Borrower Representative shall be deemed to have requested a Borrowing of Base
Rate Loans (or, at the option of the Agent, under the Swing Line) under the
Revolving Credit on such day in the amount of the Reimbursement Obligation then
due, which Borrowing shall be applied to pay the Reimbursement Obligation then
due.

 

(d)                                 Disbursement of Loans.  Not later than
3:00 p.m. (Eastern time) on the date of any requested advance of a new
Borrowing, subject to Section 3 hereof, each Lender shall make available its
Loan comprising part of such Borrowing in funds immediately available at the
principal office of the Agent in Cincinnati, Ohio.  The Agent shall make the
proceeds of each new Borrowing available to Borrower Representative by deposit
into a non-interest bearing, disbursement funding account maintained at the
Agent (the “Funding Account”); provided that Base Rate Revolving Loans made to
finance the reimbursement of a Reimbursement Obligation shall be remitted by the
Agent to the L/C Issuer or if an Overadvance shall be retained by the Agent.

 

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(e)                                  Funding by Lenders; Presumption by Agent. 
Unless the Agent shall have received notice from a Lender (x) in the case of
Base Rate Loans, four (4) hours prior to the proposed time of such Borrowing and
(y) otherwise, prior to the proposed date of any Borrowing that such Lender will
not make available to the Agent such Lender’s share of such Borrowing, the Agent
may assume that such Lender has made such share available on such date in
accordance with Section 2.5 and may, in reliance upon such assumption, make
available to Borrowers a corresponding amount.  In such event, if a Lender has
not in fact made its share of the applicable Borrowing available to the Agent,
then the applicable Lender and Borrowers severally agree to pay to the Agent
forthwith on demand such corresponding amount with interest thereon, for each
day from and including the date such amount is made available to Borrowers to
but excluding the date of payment to the Agent, at (i) in the case of a payment
to be made by such Lender, the greater of the Federal Funds Rate and a rate
determined by the Agent in accordance with banking industry rules on interbank
compensation, and (ii) in the case of a payment to be made by Borrowers, the
interest rate applicable to Base Rate Loans.  If Borrowers and such Lender shall
pay such interest to the Agent for the same or an overlapping period, the Agent
shall promptly remit to Borrower Representative the amount of such interest paid
by Borrowers for such period.  If such Lender pays its share of the applicable
Borrowing to the Agent, then the amount so paid shall constitute such Lender’s
Loan included in such Borrowing.  Any payment by Borrowers shall be without
prejudice to any claim Borrowers may have against a Lender that shall have
failed to make such payment to the Agent.

 

(f)                                   For the purposes of calculating interest
and fees, determining Revolving Loan Availability and the amount of Eligible
Accounts, all Remittances and other proceeds of Accounts and other Collateral
deposited into any collection account shall be credited (conditional on final
collection) against the Obligations as set forth in Section 2.15 hereof and the
then Eligible Accounts as funds become collected and available in accordance
with Agent’s designated funds availability policies from time to time in
effect.  For the avoidance of doubt, on the Second Restatement Closing Date, the
Agent’s designated funds availability policy is as follows:  the Agent shall,
(i) within two (2) Business Days after receipt by the Agent at its identified
collection office of checks, (ii) within one (1) Business Day of receipt by the
Agent at its identified collection office of cash by ACH or other immediately
available funds, and (iii) within the same Business Day upon receipt by the
Agent at its identified collection office of cash by wire transfer, apply the
whole or any part of such collections or Proceeds against the Revolving Loans
and Swing Loans and other Obligations in accordance with the terms and
conditions of this Agreement.

 

Section 2.6                                    Minimum Borrowing Amounts;
Maximum Eurodollar Loans.  Each Borrowing of Base Rate Loans advanced under a
Credit shall be in an amount not less than $500,000 (other than Swing Loans and
Overadvances) or such greater amount that is an integral multiple of $50,000. 
Each Borrowing of Eurodollar Loans advanced, continued or converted under a
Credit shall be in an amount equal to $1,000,000 or such greater amount that is
an integral multiple of $100,000.  Without the Agent’s consent, there shall not
be more than six (6) Borrowings of Eurodollar Loans outstanding at any one time.

 

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Section 2.7                                    Maturity of Loans.

 

(a)                                 Scheduled Payments of Term Loans.  Borrowers
shall make principal payments on the Term Loans in consecutive quarterly
installments on the last Business Day of each March, June, September, and
December in each year, in the amounts set forth below for each corresponding
quarter; it being further agreed that a final payment comprised of all principal
and interest not sooner paid on the Term Loans, shall be due and payable on the
Maturity Date.  Each principal payment on the Term Loans shall be applied to the
Term Lenders holding the Term Loans pro rata based upon their Term Loan
Percentages.

 

Term Loan

 

Quarter End Date/
Payment Date

 

Principal Installment
Amount

 

Principal Installment
Percentage

 

9/30/2016

 

$

1,250,000.00

 

2.50

%

12/31/2016

 

$

1,250,000.00

 

2.50

%

3/31/2017

 

$

1,250,000.00

 

2.50

%

6/30/2017

 

$

1,250,000.00

 

2.50

%

9/30/2017

 

$

1,250,000.00

 

2.50

%

12/31/2017

 

$

1,250,000.00

 

2.50

%

3/31/2018

 

$

1,250,000.00

 

2.50

%

6/30/2018

 

$

1,250,000.00

 

2.50

%

9/30/2018

 

$

1,875,000.00

 

3.75

%

12/31/2018

 

$

1,875,000.00

 

3.75

%

3/31/2019

 

$

1,875,000.00

 

3.75

%

6/30/2019

 

$

1,875,000.00

 

3.75

%

9/30/2019

 

$

1,875,000.00

 

3.75

%

12/31/2019

 

$

1,875,000.00

 

3.75

%

3/31/2020

 

$

1,875,000.00

 

3.75

%

6/30/2020

 

$

1,875,000.00

 

3.75

%

9/30/2020

 

$

1,875,000.00

 

3.75

%

12/31/2020

 

$

1,875,000.00

 

3.75

%

3/31/2021

 

$

1,875,000.00

 

3.75

%

Maturity Date

 

the then outstanding principal
balance

 

 

 

 

(b)                                 Revolving Loans.  Each Revolving Loan, both
for principal and interest, shall mature and become due and payable by Borrowers
on the Revolving Credit Termination Date.

 

Section 2.8                                    Prepayments.

 

(a)                                 Voluntary.  Borrowers may prepay without
premium or penalty (except as set forth in Section 8.1 below) and in whole or in
part any Borrowing of Eurodollar Loans at any time upon three (3) Business Days’
prior notice by Borrower Representative to the Agent or, in the case of a
Borrowing of Base Rate Loans, notice delivered by Borrower Representative to the
Agent no later than 10:00 a.m. (Eastern time) on the date of prepayment, such
prepayment to be

 

44

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made by the payment of the principal amount to be prepaid and, in the case of
any Term Loans, Eurodollar Loans, Overadvances or Swing Loans accrued interest
thereon to the date fixed for prepayment plus any amounts due the Lenders under
Section 8.1; provided, however, Borrowers may not partially repay a Borrowing
(i) if such Borrowing is of Base Rate Loans (other than Swing Loans), in a
principal amount less than $500,000, (ii) if such Borrowing is of Eurodollar
Loans, in a principal amount less than $1,000,000, and (iii) in each case,
unless such Borrowing is in an amount such that the minimum amount required for
a Borrowing pursuant to Section 2.6 remains outstanding.  Any such voluntary
prepayments of the Term Loan shall be applied against the remaining installments
of principal of the Term Loan on a pro rata basis until the Term Loan is repaid
in full.

 

(b)                                 Mandatory.

 

(i)                                     If any Credit Party or any Subsidiary
shall at any time or from time to time make or agree to make a Disposition or
shall suffer an Event of Loss resulting in Net Cash Proceeds in excess of
$250,000 individually or on a cumulative basis in any fiscal year of Credit
Parties, then (x) Borrower Representative shall promptly notify the Agent of
such proposed Disposition or Event of Loss (including the amount of the
estimated Net Cash Proceeds to be received by such Credit Party or such
Subsidiary in respect thereof) and (y) promptly (and in any event within five
(5) Business Days) upon receipt by any Credit Party or the Subsidiary of the Net
Cash Proceeds of such Disposition or such Event of Loss, Borrowers shall prepay
the Obligations in an aggregate amount equal to 100% of the amount of all such
Net Cash Proceeds in excess of $250,000; provided that in the case of each
Disposition and Event of Loss, if Borrower Representative states in its notice
of such event that the applicable Credit Party or Subsidiary intends to invest
or reinvest, as applicable, within one hundred eighty (180) days of the
applicable Disposition or receipt of Net Cash Proceeds from an Event of Loss,
the Net Cash Proceeds thereof in similar like-kind assets, then so long as no
Default or Event of Default then exists, Borrowers shall not be required to make
a mandatory prepayment under this Section in respect of such Net Cash Proceeds
to the extent such Net Cash Proceeds are either (x) actually invested or
reinvested or (y) committed to be invested or reinvested, in each case as
described in Borrower Representative’s notice with such 180-day period. 
Promptly after the end of such 180-day period, Borrower Representative shall
notify the Agent whether such Credit Party or such Subsidiary has invested or
reinvested such Net Cash Proceeds as described in Borrower Representative’s
notice, and to the extent such Net Cash Proceeds have not been so invested or
reinvested, Borrowers shall promptly prepay the Obligations in the amount of
such Net Cash Proceeds not so invested or reinvested.  The amount of each such
prepayment shall be applied first to any outstanding Overadvances, then to the
outstanding Term Loans until paid in full (applied on a pro rata basis over the
remaining principal amortization payments thereof), and, then to (in the order
determined by Agent but without a reduction in Revolving Credit Commitments) the
Revolving Loans, Swing Loans, Reimbursement Obligations.

 

(ii)                                  If after the Second Restatement Closing
Date any Credit Party or any Subsidiary shall issue any new equity securities
(other than (a) equity securities issued in connection with the exercise of
employee stock options, (b) equity securities

 

45

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

 

issued in connection with the exercise of the Cure Right, (c) equity securities
issued by a Subsidiary to another Credit Party, (d) equity securities sold to
management and/or any employees of any Credit Party or any Subsidiary or
(e) equity securities issued in connection with any capital contributions by
Holdings or incur or assume any Indebtedness (other than that permitted by
Section 6.11 hereof), then in each such case Borrower Representative shall
promptly notify the Agent of the estimated Net Cash Proceeds of such issuance,
incurrence or assumption to be received by or for the account of such Credit
Party or such Subsidiary in respect thereof.  Promptly (and in any event within
five (5) Business Days) upon receipt by such Credit Party or such Subsidiary of
Net Cash Proceeds of such issuance, incurrence or assumption Borrowers shall
prepay the Obligations in the amount of such Net Cash Proceeds.  The amount of
each such prepayment shall be applied first to any outstanding Overadvances,
then to the outstanding Term Loans until paid in full (applied on a pro rata
basis over the remaining principal amortization payments thereof), and, then to
(in the order determined by Agent but without a reduction in Revolving Credit
Commitments) the Revolving Loans, Swing Loans and Reimbursement Obligations. 
Each Credit Party acknowledges that its performance hereunder shall not limit
the rights and remedies of the Lenders for any breach of Section 6.11 or any
other terms of this Agreement.

 

(iii)                               No later than five (5) Business Days after
the earlier of (a) receipt by Agent of the audited financial statements required
by Section 6.1(c) hereof and (b) the due date of the delivery of the audited
financial statements required by Section 6.1(c) hereof, beginning with the
fiscal year ending June 30, 2017, Borrowers shall prepay the then-outstanding
Loans by an amount equal to 50% of Excess Cash Flow of Credit Parties and their
Subsidiaries for the most recently completed fiscal year of Credit Parties;
provided, however, that if the Senior Leverage Ratio (determined as of the last
day of any applicable fiscal year by reference to the financial statements
delivered pursuant to Section 6.1(c) for such fiscal year) is less than
1.00:1.00, Borrowers shall not be required to make a prepayment of Excess Cash
Flow for such fiscal year.  The amount of each such prepayment shall be applied
first to the outstanding Term Loan until paid in full (applied on a pro rata
basis over the remaining principal amortization payments thereof) and then to
the Revolving Loans until paid in full, and, then to (in the order determined by
Agent but without a reduction in Revolving Credit Commitments) any Overadvances,
Swing Loans, Reimbursement Obligations, without any reduction in commitments. 
Any voluntary prepayments of principal of the Term Loans and, solely to the
extent accompanied by a permanent reduction on commitments, the Revolving Loans,
made during any year shall reduce, by the amount of such voluntary prepayments,
the amount required to be paid by Borrowers under this
Section 2.8(b)(iii) during the year immediately subsequent to the year such
voluntary prepayments were made; provided that, the amount required to be paid
under this Section 2.8(b)(iii) shall not in any event be reduced to less than
zero, and no such voluntary prepayments shall reduce payments required to be
made under this Section 2.8(b)(iii) in any year following the year immediately
subsequent to the year such voluntary payments were made.

 

(iv)                              Borrowers shall, (A) on each date the
Revolving Credit Commitments are reduced pursuant to Section 2.10, prepay any
Overadvances, the Revolving Loans, Swing Loans, Reimbursement Obligations and,
if necessary, Cash

 

46

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Collateralize the L/C Obligations by the amount, if any, necessary to reduce the
amount of the aggregate Revolving Credit Exposures of all Lenders then
outstanding to the amount of the Revolving Credit Commitments or the amounts to
which the Revolving Credit Commitments have been so reduced and (B) on each date
the aggregate amount of Revolving Credit Exposures of all Lenders then
outstanding exceeds the lesser of (x) the Revolving Loan Limit as determined
based on the most recent Compliance Certificate (plus any Overadvances pursuant
to Section 2.11(b)) and (y) the total Revolving Credit Commitments, prepay the
Revolving Loans, Swing Loans, Reimbursement Obligations and, if necessary, Cash
Collateralize the L/C Obligations and repay any Overadvances then due and
payable pursuant to Section 2.11(b), in an amount equal to such excess.

 

(v)                                 Borrowers shall pay to the Agent when and as
received by Borrowers and as a mandatory prepayment of the Obligations, a sum
equal to the Cure Amount determined in accordance with Credit Parties’ exercise
of Cure Rights pursuant to and in accordance with Section 7.7 hereof.  The
prepayment shall be applied unless otherwise agreed by the Agent (x) 100% of
such Cure Amount first to any outstanding Overadvances, then to the Term Loan,
ratably, each such ratable amount to be applied against the remaining
installments of principal of the Term Loan in the inverse order of their
maturities, and thereafter to repay outstanding principal of the Revolving Loans
(without a concomitant reduction in the Revolving Credit Commitments), and
(y) if no Overandvances are outstanding and if the Term Loan, and Revolving
Loans are paid in full, thereafter against the other Obligations, in such order
as the Agent determines.

 

(vi)                              Unless Borrower Representative otherwise
directs, prepayments of Loans under this Section 2.8(b) shall be applied first
to Borrowings of Base Rate Loans until payment in full thereof with any balance
applied to Borrowings of Eurodollar Loans in the order in which their Interest
Periods expire.  Each prepayment of Loans under this Section 2.8(b) shall be
made by the payment of the principal amount to be prepaid and, in the case of
any Term Loans, Swing Loans or Eurodollar Loans, accrued interest thereon to the
date of prepayment together with any amounts due the Lenders under Section 8.1. 
Each prefunding of L/C Obligations shall be made in accordance with Section 7.4.

 

(c)                                  Notice of Prepayment.  The Agent will
promptly advise each Lender of any notice of prepayment it receives from
Borrower Representative, and in the case of any partial prepayment, such
prepayment shall be applied to the remaining amortization payments on the
relevant Loans in accordance with this Section 2.8.

 

Section 2.9                                    Place and Application of
Payments.  All payments of principal of and interest on the Loans and the
Reimbursement Obligations, and of all other Obligations payable by Borrowers
under this Agreement and the other Loan Documents, shall be made by Borrowers to
the Agent by no later than 2:00 p.m. (Eastern time) on the due date thereof at
the office of the Agent in Cincinnati, Ohio (or such other location as the Agent
may designate to Borrower Representative) for the benefit of the Lender or
Lenders entitled thereto.  Any payments received after such time shall be deemed
to have been received by the Agent on the next Business Day.  All such payments
shall be made in Dollars, in immediately available funds at the place of
payment, in each case without set-off or counterclaim.  The Agent will promptly
thereafter cause to be distributed like funds relating to the payment of
principal or interest on Loans and on

 

47

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Reimbursement Obligations in which the Lenders have purchased Participating
Interests ratably to the Lenders and like funds relating to the payment of any
other amount payable to any Lender to such Lender, in each case to be applied in
accordance with the terms of this Agreement.  Unless the Agent shall have
received notice from Borrower Representative prior to the date on which any
payment is due to the Agent for the account of the Lenders or the L/C Issuers
hereunder that Borrowers will not make such payment, the Agent may assume that
Borrowers have made such payment on such date in accordance herewith and may, in
reliance upon such assumption, distribute to the Lenders or the L/C Issuers, as
the case may be, the amount due.  In such event, if Borrowers have not in fact
made such payment, then each of the Lenders or the L/C Issuers, as the case may
be, severally agrees to repay to the Agent forthwith on demand the amount so
distributed to such Lender or L/C Issuer, 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 Agent, at the greater of the Federal Funds Rate and a
rate determined by the Agent in accordance with banking industry rules on
interbank compensation.

 

Anything contained herein to the contrary notwithstanding, (x) pursuant to the
exercise of remedies under Sections 7.2 and 7.3 hereof or (y) after written
instruction by the Required Lenders after the occurrence and during the
continuation of an Event of Default, all payments and collections received in
respect of the Obligations and all proceeds of the Collateral received, in each
instance, by the Agent or any of the Lenders shall be remitted to the Agent and
distributed as follows:

 

(a)                                 first, to the payment of any outstanding
costs and expenses incurred by the Agent, and any security trustee therefor, in
monitoring, verifying, protecting, preserving or enforcing the Liens on the
Collateral, in protecting, preserving or enforcing rights under the Loan
Documents, and in any event all costs and expenses of a character which Credit
Parties have agreed to pay the Agent under Section 10.13 hereof (such funds to
be retained by the Agent for its own account unless it has previously been
reimbursed for such costs and expenses by the Lenders, in which event such
amounts shall be remitted to the Lenders to reimburse them for payments
theretofore made to the Agent);

 

(b)                                 second, to the payment of principal and
interest on the Swing Loans and Overadvances until paid in full;

 

(c)                                  third, to payment of reimbursable costs and
expenses of the Lenders (other than Agent);

 

(d)                                 fourth, to the payment of any outstanding
interest and fees due under the Loan Documents to be allocated pro rata in
accordance with the aggregate unpaid amounts owing to each holder thereof;

 

(e)                                  fifth, to the payment of principal on the
Loans (other than Swing Loans and Overadvances), unpaid Reimbursement
Obligations, together with amounts to be held by the Agent as collateral
security for any outstanding L/C Obligations pursuant to Section 7.4 hereof
(until the Agent is holding an amount of cash equal to the then outstanding
amount of all such L/C Obligations), and Rate Management Obligations, the
aggregate amount paid to, or held as collateral security for, the Lenders and,
in the case of Rate Management Obligations, their

 

48

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Affiliates to be allocated pro rata in accordance with the aggregate unpaid
amounts owing to each holder thereof;

 

(f)                                   sixth to the payment of Banking Services
Obligations and Rate Management Obligations;

 

(g)                                  seventh, to the payment of all other unpaid
Obligations and all other indebtedness, obligations, and liabilities of Credit
Parties and their Subsidiaries secured by the Collateral Documents to be
allocated pro rata in accordance with the aggregate unpaid amounts owing to each
holder thereof; and

 

(h)                                 eighth, to Borrowers or whoever else may be
lawfully entitled thereto;  provided that in respect of the foregoing, no
payments by a Guarantor and no proceeds of Collateral of a Guarantor shall be
applied to any Excluded Swap Obligation of such Guarantor.

 

Excluded Swap Obligations with respect to any Guarantor shall not be paid with
amounts received from such Guarantor or such Guarantor’s assets, but appropriate
adjustments shall be made with respect to payments from other Credit Parties to
preserve the allocation to Obligations otherwise set forth above in this
Section.

 

Notwithstanding the foregoing, Rate Management Obligations and Banking Services
Obligations shall be excluded from the application described above if the Agent
has not received written notice that describes in detail the Rate Management
Obligations and Banking Services Obligations to be secured by the Collateral,
together with such supporting documentation as the Agent may request, from the
applicable Lender (other than Fifth Third).  Any such Person not a party to this
Agreement that has given the notice contemplated by the preceding sentence
shall, by such notice, be deemed to have acknowledged and accepted the
appointment of the Agent pursuant to the terms of Section 9 for itself and its
Affiliates as if a “Lender” party hereto.

 

No Rate Management Agreement or agreement in respect of Banking Services
Obligations will create (or be deemed to create) in favor of any Person that is
a party thereto any rights in connection with the management or release of any
Collateral or of the obligations of any Borrower or any other Credit Party under
the Loan Documents, except as expressly provided herein or in the other Loan
Documents.  By accepting the benefits of the Collateral, each such Person shall
be deemed to have appointed the Agent as its agent and agreed to be bound by the
Loan Documents as a holder of the Obligations, subject to the limitations set
forth in this Section 2.9.  Furthermore, it is understood and agreed that each
such Person, in their capacity as such, shall not have any right to notice of
any action or to consent to, direct or object to any action hereunder or under
any of the other Loan Documents or otherwise in respect of the Collateral
(including the release or impairment of any Collateral, or to any notice of or
consent to any amendment, waiver or modification of the provisions hereof or of
the other Loan Documents) other than in its capacity as a Lender and, in any
case, only as expressly provided herein.

 

Section 2.10                             Commitment Terminations.  Borrower
Representative shall have the right at any time and from time to time, upon
three (3) Business Days’ prior written notice to the Agent, to terminate the
Revolving Credit Commitments in whole or in part, any partial

 

49

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termination to be (i) in an amount not less than $500,000 or any greater amount
that is an integral multiple of $100,000 and (ii) allocated ratably among the
Lenders in proportion to their respective Applicable Percentages, provided that
the Revolving Credit Commitments may not be reduced to an amount less than the
amount of the aggregate Revolving Credit Exposures of all Lenders then
outstanding.  Any termination of the Revolving Credit Commitments below the L/C
Sublimit then in effect shall reduce the L/C Sublimit by a like amount.  Any
termination of the Revolving Credit Commitments below the Swing Line Sublimit
then in effect shall reduce the Swing Line Sublimit by a like amount.  The Agent
shall give prompt notice to each Lender of any such termination of the Revolving
Credit Commitments.  Any termination of the Commitments pursuant to this
Section 2.10 may not be reinstated.

 

Section 2.11                             Swing Loans.

 

(a)                                 Generally.  The Agent and the Lenders agree
that in order to facilitate the administration of this Agreement and the other
Loan Documents, promptly after Borrower Representative requests a Base Rate
Revolving Loan, the Agent and the applicable Swing Line Lender may elect to have
the terms of this Section 2.11(a) apply to such Borrowing request by such Swing
Line Lender advancing, on behalf of the Lenders and in the amount requested,
same day funds (each such Loan made solely by a Swing Line Lender pursuant to
this Section 2.11(a) is referred to in this Agreement as a “Swing Loan”) to
Borrowers on the applicable Borrowing date to the Funding Account, with
settlement among the Lenders as to the Swing Loans to take place on a periodic
basis as set forth in Section 2.11(d).  Each Swing Loan shall be subject to all
the terms and conditions applicable to other Base Rate Loans funded by the
Lenders, except that all payments thereon shall be payable to a Swing Line
Lender solely for its own account.  In addition, each Borrower hereby authorizes
Agent in its capacity as a Swing Line Lender to, and such Swing Line Lender
shall, subject to the terms and conditions set forth herein (but without any
further written notice required), not later than 1:00 p.m. (Eastern time), on
each Business Day, make available to Borrowers by means of a credit to the
Funding Account, the proceeds of a Swing Loan to the extent necessary to pay
items to be drawn on the Controlled Disbursement Account that Business Day;
provided that, if on any Business Day there is insufficient borrowing capacity
to permit such Swing Line Lender to make available to Borrowers a Swing Loan in
the amount necessary to pay all items to be so drawn on any the Controlled
Disbursement Account on such Business Day, then Borrowers shall be deemed to
have requested a Base Rate Revolving Loan pursuant to Section 2.2 in the amount
of such deficiency to be made on such Business Day.  The aggregate amount of
Swing Loans outstanding at any time shall not exceed the Swing Line Sublimit. 
No Swing Line Lender shall make any Swing Loan if the requested Swing Loan
exceeds Revolving Loan Availability (before giving effect to such Swing Loan). 
All Swing Loans shall be Base Rate Borrowings.

 

(b)                                 Overadvances.  Any provision of this
Agreement to the contrary notwithstanding, at the request of Borrower
Representative, the Lenders, with the consent of the Required Lenders, may (but
shall have no obligation to do so), make Revolving Loans to Borrower, in amounts
that exceed the Revolving Loan Limit (any such excess Revolving Loans are herein
referred to collectively as “Overadvances”); provided that, no Overadvance shall
result in an Event of Default due to Borrowers’ failure to comply with
Section 2.8(b)(iv) for so long as such Overadvance remains outstanding in
accordance with the terms of this Section 2.11(b), but solely with respect to
the amount of such Overadvance.  In addition,

 

50

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Overadvances may be made even if the condition precedent set forth in
Section 3.1(c) has not been satisfied.  All Overadvances shall constitute Base
Rate Borrowings.  Such Overadvances shall be limited to an aggregate amount not
to exceed $2,000,000 at any time, and no Overadvance shall cause any Lender’s
Revolving Credit Exposure to exceed its Revolving Credit Commitment.  Each
Overadvance, both principal and interest, shall mature and become payable by
Borrowers on the earlier of (i) the Revolving Credit Termination Date, (ii) the
120th day after such Overadvance is made, and (iii) demand by the Required
Lenders.

 

(c)                                  Participation.  Upon the making of a Swing
Loan or an Overadvance (whether before or after the occurrence of an Event of
Default and regardless of whether a Settlement has been requested with respect
to such Swing Loan or Overadvance), each Lender shall be deemed, without further
action by any party hereto, to have unconditionally and irrevocably purchased
from each Swing Line Lender, without recourse or warranty, an undivided interest
and participation in such Swing Loan or Overadvance in proportion to its
Applicable Percentage of the Revolving Credit Commitment. Each Swing Line Lender
may, at any time, require the Lenders to fund their participations.  From and
after the date, if any, on which any Lender is required to fund its
participation in any Swing Loan or Overadvance purchased hereunder, such Swing
Line Lender 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 such Swing Line Lender in respect of such Swing Loan or
Overadvance.

 

(d)                                 Settlement.  Each Swing Line Lender shall
request settlement (a “Settlement”) with the Lenders on at least a weekly basis
or on any date that such Swing Line Lender elects, by notifying the Lenders of
such requested Settlement by facsimile, telephone, or e-mail no later than 12:00
noon Eastern time on the date of such requested Settlement (the “Settlement
Date”).  Each Lender (other than a Swing Line Lender with respect to its Swing
Loans) shall transfer the amount of such Lender’s Applicable Percentage of the
outstanding principal amount of the applicable Loan with respect to which
Settlement is requested to such Swing Line Lender, to such account of such Swing
Line Lender as such Swing Line Lender may designate, not later than 2:00 p.m.,
Eastern time, on such Settlement Date.  Settlements may occur during the
existence of an Event of Default and whether or not the applicable conditions
precedent set forth in Section 3.1 have then been satisfied.  Such amounts
transferred to such Swing Line Lender shall be applied against the amounts of
such Swing Line Lender’s Swing Loans or Overadvances and, together with each
Swing Line Lender’s Applicable Percentage of such Swing Loan or Overadvance,
shall constitute Revolving Loans of such Lenders, respectively.  If any such
amount is not transferred to such Swing Line Lender by any Lender on such
Settlement Date, such Swing Line Lender shall be entitled to recover from such
Lender on demand such amount, together with interest thereon, as specified in
Section 2.5.

 

Section 2.12                             Evidence of Indebtedness.

 

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

 

51

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(b)                                 The Agent shall also maintain accounts in
which it will record (i) the amount of each Loan made hereunder, the type
thereof and, with respect to Eurodollar Loans, the Interest Period with respect
thereto, (ii) the amount of any principal or interest due and payable or to
become due and payable from Borrowers to each Lender hereunder and (iii) the
amount of any sum received by the Agent hereunder from Borrowers and each
Lender’s share thereof.

 

(c)                                  The entries maintained in the accounts
maintained pursuant to paragraphs (a) and (b) above shall be prima facie
evidence of the existence and amounts of the Obligations therein recorded;
provided, however, that the failure of the Agent or any Lender to maintain such
accounts or any error therein shall not in any manner affect the obligation of
any Borrower to repay the Obligations in accordance with their terms.

 

(d)                                 The Loans may be evidenced by a promissory
note or notes in the forms of Exhibit D-1 (in the case of its Term Loan and
referred to herein as a “Term Note”), , D-2 (in the case of its Revolving Loans
and referred to herein as a “Revolving Note”), or D-3 (in the case of its Swing
Loans and referred to herein as a “Swing Note”), as applicable (the Term Notes,
Revolving Notes and Swing Note being hereinafter referred to collectively as the
“Notes” and individually as a “Note”).  Upon request, Borrowers shall prepare,
execute and deliver to each Lender a Note payable to the order of such Lender in
the amount of the Term Loan, or Revolving Credit Commitment, or Swing Line
Sublimit, as applicable.  The Loans evidenced by such Note or Notes and interest
thereon shall at all times (including after any assignment pursuant to
Section 10.8) be represented by one or more Notes payable to the payee named
therein or any assignee pursuant to Section 10.8, except to the extent that any
such Lender or assignee subsequently returns any such Note for cancellation and
requests that such Loans once again be evidenced as described in
subsections (a) and (b) above.

 

Section 2.13                             Fees.

 

(a)                                 Revolving Credit Commitment Fee.  Borrowers
shall pay to the Agent for the ratable account of the Lenders according to their
Applicable Percentages a commitment fee (“Commitment Fee”) at the rate per annum
equal to the Applicable Margin (computed on the basis of a year of 360 days and
the actual number of days elapsed) on the average daily Unused Revolving Credit
Commitments.  Such Commitment Fee shall be payable monthly in arrears on the
last Business Day of each calendar month and on the Revolving Credit Termination
Date, unless the Revolving Credit Commitments are terminated in whole on an
earlier date, in which event the Commitment Fee for the period to the date of
such termination in whole shall be paid on the date of such termination.

 

(b)                                 Letter of Credit Fees.  On the date of
issuance or extension, or increase in the amount, of any Letter of Credit issued
by a L/C Issuer pursuant to Section 2.3 hereof, Borrowers shall pay to such L/C
Issuer for its own account a fronting fee equal to 0.125% of the face amount of
(or of the increase in the face amount of) such Letter of Credit.  On the date
of issuance of any Letter of Credit, and on each anniversary thereof, Borrowers
shall pay to the Agent, for the ratable benefit of the Lenders according to
their Applicable Percentages, a letter of credit fee (“L/C Fee”) at a rate per
annum equal to the then applicable Applicable Margin for Eurodollar Loans
(computed on the basis of a year of 360 days and the actual number of days
elapsed) in effect on such date applied to the daily average face amount of
Letters of Credit

 

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outstanding on such date; provided that, while any Event of Default exists or
after acceleration, such rate shall increase by 2% over the rate otherwise
payable and such fee shall be paid on demand of the Agent at the request or with
the consent of the Required Lenders; provided, however, that in the absence of
acceleration, any rate increase pursuant to the foregoing proviso shall be made
at the direction of the Agent, acting at the request or with the consent of the
Required Lenders.

 

(c)                                  Fee Letters.  Agent and each Lender shall
receive, for its own use and benefit, the fees agreed to with the Credit Parties
as set forth in the following fee letter agreements (“Fee Letters”): (i) Fifth
Third and the Credit Parties in that certain fee letter dated as of the Second
Restatement Closing Date, and (ii) Bank of America, N. A. and the Credit Parties
in that certain fee letter dated as of the Second Restatement Closing Date, or
as otherwise agreed to in writing between such parties.

 

Section 2.14                             Account Debit.  Each Borrower hereby
irrevocably authorizes the Agent to charge any of such Borrower’s deposit
accounts maintained with the Agent for the amounts from time to time necessary
to pay any then due Obligations; provided that such Borrower acknowledges and
agrees that the Agent shall not be under an obligation to do so and the Agent
shall not incur any liability to any Borrower or any other Person for the
Agent’s failure to do so.

 

Section 2.15                             Collections; Controlled Disbursement
Accounts.

 

(a)                                 Collections.  To the extent not previously
completed, within forty-five (45) days after the Second Restatement Closing
Date, each Borrower will notify all of its customers and Account Debtors, which
pay their Accounts by electronic funds transfer, to forward all Remittances
directly to a collection, non-interest bearing DDA depository account maintained
at Agent (“Collection Account”) by wire transfer or automated clearinghouse
funds transfer (“ACH”) (such notices to be in such form and substance as Agent
may require in its reasonable discretion from time to time).  For all of any
Borrower’s customers and account debtors that forward their Remittances in paper
form to such Borrower, such Borrower, to the extent not previously completed,
within forty-five (45) days after the Second Restatement Closing Date, will
utilize the Agent’s electronic deposit and cash management system (i.e., remote
capture) to deposit such Remittances directly into the Collection Account.  If
any Borrower should neglect or refuse to notify any customer or Account Debtor
to pay any Remittance to the Collection Account in the case of electronic
payments, the Agent will be entitled to make such notification.  Any Remittance
or other Proceeds of Accounts or other Collateral received by any Borrower shall
be deemed held by such Borrower in trust for the Agent, and such Borrower
immediately shall utilize the remote capture system as provided above or deliver
the same, in its original form, to the Agent by overnight delivery for deposit
into the Collection Account.  Pending such deposit whether via remote capture or
overnight delivery, no Borrower will commingle any such Remittance or other
Proceeds of Accounts or other Collateral with any of its other funds or
property, but such Borrower will hold it separate and apart therefrom in trust
for the Agent until delivery is made to the Agent as described above.  All
deposits to the Collection Account will be the Agent’s property to be applied
against the Obligations as provided in this Section 2.15, except to the extent a
different application is required pursuant to the provisions of Section 2.9. 
The Agent shall have sole access to the Collection Account.  Each Business Day,
the Agent, in accordance with the Agent’s policies and

 

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procedures, will transfer all collected and available funds in the Collection
Account pursuant to the Agent’s automated sweep program, automatically and
without notice, request or demand by any Borrower for application against the
unpaid principal balance of (in the order determined by Agent) the Revolving
Loans, Swing Loans and Reimbursement Obligations.  If, after such application by
the Agent, there remains excess available funds in the Collection Account and an
Event of Default is not then existing, then the Agent will deposit such excess
funds into the Funding Account.  Pursuant to such automatic sweep program of the
Agent, the Agent will make Swing Loans or Revolving Loans as described in
Section 2.11 to cover presentments to the controlled disbursement
account(s) maintained by Borrowers with Agent (the “Controlled Disbursement
Account”).  Until a payment is received by the Agent for the Agent’s account in
finally collected funds, all risks associated with such payment will be borne
solely by Borrowers.  If any Remittance deposited in the Collection Account is
dishonored or returned unpaid for any reason, the Agent, in its discretion, may
charge the amount of such dishonored or returned Remittance directly against any
Borrower and any account maintained by any Borrower with the Agent and such
amount shall be deemed part of the Obligations. For the purposes of calculating
interest and fees, determining Revolving Loan Availability and the amount of
Eligible Accounts, all Remittances and other Proceeds of Accounts and other
Collateral deposited into the Collection Account shall be credited (conditional
on final collection) against the Obligations as set forth in this Section 2.15
and the then Eligible Accounts as funds become collected and available in
accordance with Agent’s designated funds availability policies from time to time
in effect, and as described in Section 2.5(f) hereof as of the Second
Restatement Closing Date.

 

(b)                                 Cash Management Charges.  Agent’s standard
service charges and costs related to the establishment and maintenance of the
Funding Account, the Controlled Disbursement Account, the Collection Account,
the automatic sweep program, and the Agent’s treasury and cash management
services shall be the sole responsibility of Borrowers, whether the same are
incurred by the Agent or any Borrower, and the Agent, at its discretion,
exercised in good faith, may charge the same against any Borrower and any
account maintained by any Borrower with the Agent and the same shall be deemed
part of the Obligations, subject to the provisions of Section 2.9 hereof. 
Without limitation of the provisions of the Security Agreement, and without
limitation to the provisions below relating to the ownership of the Collection
Account and the deposits and funds therein, the Agent shall have, and each
Borrower hereby grants to the Agent, for the benefit of itself and the Lenders,
a Lien on all funds held in the Funding Account, the Controlled Disbursement
Account, and the Collection Account as security for the Obligations.  The
Funding Account, the Controlled Disbursement Account, and the Collection Account
will not be subject to any deduction, set-off, banker’s lien or any other right
in favor of any Person other than the Agent, for the benefit of the Lenders and
any L/C Issuer and their respective Affiliates.

 

(c)                                  Cash Management Policies.  From time to
time, the Agent may adopt such regulations and procedures and changes as it may
deem reasonable and appropriate with respect to the operation of the Funding
Account, the Controlled Disbursement Account, the Collection Account, the
automatic sweep program and the other services to be provided by the Agent under
this Agreement, and such regulations, procedures and changes need not be
reflected by an amendment to this Agreement in order to be effective.  The Agent
will give notice of such regulations, procedures and changes to Borrower
Representative in the ordinary course of the Agent’s business.  For the
avoidance of doubt, the provisions of this clause (c) will not affect the

 

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order of application of funds pursuant to the preceding paragraphs of this
Section 2.15.  The Agent shall not be liable for any loss or damage resulting
from any error, omission, failure or negligence on the part of the Agent in good
faith with respect to the operation of the Funding Account, Controlled
Disbursement Account, Collection Account, or the services to be provided by the
Agent under this Agreement except to the extent, but only to the extent, of any
direct damages, as opposed to any consequential, special or lost profit damages,
suffered by any Borrower from gross negligence or willful misconduct of the
Agent as determined by a final and non-appealable decision of a court of
competent jurisdiction.

 

SECTION 3

 

CONDITIONS PRECEDENT.

 

The obligation of each Lender to advance, continue or convert any Loan (other
than the continuation of, or conversion into, a Base Rate Loan) or of any L/C
Issuer to issue, extend the expiration date (including by not giving notice of
non-renewal) of or increase the amount of any Letter of Credit under this
Agreement, shall be subject to the following conditions precedent:

 

Section 3.1                                    All Credit Events.  At the time
of each Credit Event hereunder:

 

(a)                                 each of the representations and warranties
set forth herein and in the other Loan Documents shall be true and correct
(i) in all respects if such date is the Second Restatement Closing Date, on and
as of such date, and (ii) otherwise, in all material respects (provided that if
any representation or warranty is by its terms qualified by concepts of
materiality, such representation and warranty shall be true and correct in all
respects) on and as of such date, in each case except to the extent the same
expressly relate to an earlier date in which case such representations and
warranties shall be true and correct in all material respects as of such earlier
date;

 

(b)                                 no Default or Event of Default shall have
occurred and be continuing or would occur as a result of such Credit Event,
unless such Default or Event of Default shall have been waived in writing in
accordance with this Agreement;

 

(c)                                  after giving effect to any requested
extension of credit, the aggregate principal amount of the Revolving Credit
Exposures of all Lenders shall not exceed the lesser of (x) the Revolving Loan
Limit based upon the most recent Compliance Certificate, and (y) the total
Revolving Credit Commitments in effect at such time; and

 

(d)                                 in the case of a Borrowing, the Agent shall
have received the notice required by Section 2.5 hereof, in the case of the
issuance of any Letter of Credit the L/C Issuer shall have received a duly
completed Application together with any fees called for by Section 2.13 hereof,
and, in the case of an extension or increase in the amount of a Letter of
Credit, a written request therefor in a form reasonably acceptable to such L/C
Issuer together with fees called for by Section 2.13 hereof.

 

Each request for a Borrowing hereunder and each request for the issuance of,
increase in the amount of, or extension of the expiration date of, a Letter of
Credit shall be deemed to be a

 

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representation and warranty by Credit Parties on the date of such Credit Event
as to the facts specified in subsections (a) through (d), both inclusive, of
this Section.

 

Section 3.2                                    Credit Event — Restatement
Closing Date and Term Loan Funding Date.  Before or concurrently with the Credit
Event on each of the Restatement Closing Date and the Term Loan Funding Date
(and in addition to the conditions set forth in Section 3.1):

 

(a)                                 Credit Agreement and Loan Documents- Second
Amended and Restated.  The Agent (or its counsel) shall have received (x) on the
Restatement Closing Date (i) from each party hereto either (A) a counterpart of
this Agreement signed on behalf of such party or (B) written evidence reasonably
satisfactory to the Agent (which may include facsimile or other electronic
transmission of a signed signature page of this Agreement) that such party has
signed a counterpart of this Agreement and (ii) duly executed copies of the Loan
Documents, including any promissory notes requested by a Lender pursuant to
Section 2.12 payable to the order of each such requesting Lender and a written
opinion of the Credit Parties’ counsel, addressed to the Agent, the L/C Issuers
and the Lenders, and (y) on the Term Loan Funding Date, an executed Term Note
dated as of the Term Loan Funding Date.

 

(b)                                 Authorized Representatives.  The Agent shall
have received a list of each Credit Party’s Authorized Representatives (which
shall be deemed to be reaffirmed as delivered on the Second Restatement Closing
Date as of the Term Loan Funding Date);

 

(c)                                  Closing Certificates; Certified Certificate
of Incorporation; Good Standing Certificates.  The Agent shall have received
(i) on the Restatement Closing Date, a certificate of each Credit Party, dated
as of the Second Restatement Closing Date and executed by its Secretary or
Assistant Secretary, managing or sole member, or manager, as applicable, which
shall (A) certify the resolutions of its Board of Directors, members or other
body authorizing the execution, delivery and performance of the Loan Documents
to which it is a party, (B) identify by name and title and bear the signatures
of the Responsible Officers and any other officers of such Credit Party
authorized to sign the Loan Documents to which it is a party, and (C) contain
appropriate attachments, including the certificate or articles of incorporation
or organization of each Credit Party certified by the relevant authority of the
jurisdiction of organization of such Credit Party and a true and correct copy of
its by-laws or operating, management or partnership agreement, (ii) on the
Second Restatement Closing Date, and on the Term Loan Funding Date if such date
is more than 20 days after the Second Restatement Closing Date, a long form good
standing certificate for each Credit Party from its jurisdiction of
organization, and (iii) on the Term Loan Funding Date, an opinion of counsel to
Borrower, in form and substance reasonably satisfactory to Agent;

 

(d)                                 No Default Certificate.  The Agent shall
have received a certificate, signed by a Responsible Officer of each Credit
Party on the Second Restatement Closing Date (i) stating that no Default or
Event of Default has occurred and is continuing, and (ii) stating that the
representations and warranties contained in Section 5 of this Agreement and in
the other Loan Documents are true and correct in all respects as of such date,
except to the extent the same expressly relate to an earlier date in which case
such representations and warranties shall be true and correct in all respects as
of such earlier date (which certification may be within the Term Loan Notice of
Borrowing on the Term Loan Funding Date);

 

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(e)                                  Financial Condition Certificate.  The Agent
shall have received a financial condition and solvency certificate from the
Chief Financial Officer (or other Responsible Officer of each Credit Party with
similar duties) together with, attached thereto, (i) the “Interim Balance Sheet”
(as defined therein), and (ii) the financial projections described in clause
“(q)” below, as of the Second Restatement Closing Date (which shall be deemed to
be reaffirmed as delivered on the Second Restatement Closing Date as of the Term
Loan Funding Date);

 

(f)                                   Excess Availability.  After giving effect
to all Borrowings to be made on (i) the Second Restatement Closing Date and the
issuance of any Letters of Credit on the Second Restatement Closing Date and
payment of all fees and expenses due hereunder, and (ii) the Term Loan Funding
Date, and with all Indebtedness, liabilities and obligations of the Credit
Parties current, Excess Availability shall not be less than $19,000,000;

 

(g)                                  Lien Searches.  The Agent shall have
received financing statement and, as appropriate, tax and judgment lien search
results against the Property of each of the Credit Parties evidencing the
absence of Liens on its Property except for Permitted Liens (with such delivery
to the extent satisfactory to Agent as of the Second Restatement Closing Date to
be deemed satisfied on the Term Loan Funding Date);

 

(h)                                 Material Adverse Change.  There shall be no
material adverse change in, or material adverse effect upon, the operations,
business, Property, or financial condition of the Credit Parties and their
Subsidiaries taken as a whole as determined by Agent and the Lenders from May 6,
2016 to the Restatement Closing Date, and the Term Loan Funding Date, as
applicable;

 

(i)                                     Insurance.  The Agent shall have
received evidence of insurance required to be maintained under the Loan
Documents, naming the Agent as additional insured and lender’s loss payee (with
such delivery to the extent satisfactory to Agent as of the Second Restatement
Closing Date to be deemed satisfied on the Term Loan Funding Date) ;

 

(j)                                    Fees.  The Agent and each of the Lenders
shall have received the fees called for by Section 2.13 hereof as of the Second
Restatement Closing Date (and to the extent paid thereon, shall be deemed
satisfied as of the Term Loan Funding Date);

 

(k)                                 [Reserved];

 

(l)                                     [Reserved];

 

(m)                             Pledged Stock; Stock Powers; Pledged Notes.  The
Agent shall have received (i) the certificates representing the Equity Interests
pledged pursuant to the Security Agreement, together with an undated equity
power for each such certificate executed in blank by a Responsible Officer of
the pledgor thereof and (ii) each promissory note (if any) pledged to the Agent
pursuant to the Security Agreement endorsed (without recourse) in blank (or
accompanied by an executed transfer form in blank) by the pledgor thereof (with
such delivery to the extent satisfactory to Agent as of the Second Restatement
Closing Date to be deemed satisfied on the Term Loan Funding Date) .

 

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(n)                                 Mortgage.  The Agent shall have received,
with respect to each parcel of real property which is required to be subject to
a Lien in favor of the Agent, each of the following, in form and substance
reasonably satisfactory to the Agent (with such delivery to the extent
satisfactory to Agent as of the Second Restatement Closing Date to be deemed
satisfied on the Term Loan Funding Date):

 

(i)                                     a Mortgage (as amended or amended and
restated as may be required by Agent on the Second Restatement Closing Date) on
such property;

 

(ii)                                  mortgagee’s title insurance policies (or
binding commitments therefore) in an aggregate amount acceptable to the Lenders
insuring the Liens of the Mortgages to be valid first priority Liens subject to
no defects or objections that are unacceptable to the Agent, together with such
endorsements as the Agent may require;

 

(iii)                               the Agent shall have received a survey in
form and substance acceptable to the Agent prepared by a licensed surveyor on
each parcel of real property subject to the Lien of the Mortgages, which survey
shall also state whether or not any portion of such property is in a federally
designated flood hazard area;

 

(iv)                              the Agent shall have received a report of an
independent firm of environmental engineers acceptable to the Agent concerning
the environmental hazards and matters with respect to the parcels of real
property subject to the Lien of the Mortgages, together with a reliance letter
thereon acceptable to the Agent;

 

(v)                                 the Agent shall have received a flood
determination report for each parcel of real property subject to the Lien of the
Mortgages prepared for the Agent by a flood determination company selected by
the Agent stating whether or not any portion of such property is in a federally
designated flood hazard area and, if applicable, flood insurance satisfactory to
the Lenders;

 

(o)                                 Capital Structure.  The capital and
organizational structure of the Credit Parties shall be reasonably satisfactory
to the Agent (to the extent satisfactory to Agent as of the Second Restatement
Closing Date, such capital and organizational structure to be deemed satisfied
on the Term Loan Funding Date);

 

(p)                                 Litigation.  No injunction, temporary
restraining order or other legal action that would prohibit the Credit Event on
each of the Restatement Closing Date and the Term Loan Funding Date, or other
litigation which could reasonably be expected to have a Material Adverse Effect,
shall be pending or, to the knowledge of any Credit Party, threatened;

 

(q)                                 Financial Statements; Projections.  The
Agent shall have received, each in form and substance acceptable to Agent,
(i) such financial statements as required by Agent and (ii) satisfactory
financial projections through June 30, 2021 (with such delivery to the extent
satisfactory to Agent as of the Second Restatement Closing Date to be deemed
satisfied on the Term Loan Funding Date) ;

 

(r)                                    Financial Covenants.  The Agent shall
have received evidence from the Credit Parties, in form and substance acceptable
to Agent, calculated on a pro forma basis after

 

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giving effect to the Closing Date Transactions, that the Total Leverage Ratio of
the Credit Parties and their Subsidiaries, for the twelve month period then
ending, is not greater than 1.60 to 1.00, as of each of the Second Restatement
Closing Date and the Term Loan Funding Date; and

 

(s)                                   Other.  The Agent shall have received such
other agreements, instruments, documents, certificates, and opinions as the
Agent may reasonably request including, without limitation, those listed on any
document checklist prepared by Agent.  Each such closing delivery set forth in
this Section required by this Section 3.2(b) shall be in form and substance
reasonably satisfactory to the Agent and the Lenders.

 

SECTION 4

 

THE COLLATERAL, GUARANTIES.

 

Section 4.1                                    Collateral.  The Obligations,
including, without limitation, Rate Management Obligations and Banking Services
Obligations, shall be secured by (a) valid, perfected, and enforceable Liens on
all right, title, and interest of each of the Credit Parties and each Subsidiary
in all capital stock and other Equity Interests held by such Person in each of
its Subsidiaries, whether now owned or hereafter formed or acquired, and all
Proceeds thereof, and (b) valid, perfected, first priority and enforceable Liens
on all right, title, and interest of each of the Credit Parties and each
Subsidiary in all personal property, fixtures, and real estate, whether now
owned or hereafter acquired or arising, and all Proceeds thereof, in each case
subject to Permitted Liens.  Holdings will cause 100% of the issued and
outstanding Equity Interests of each of direct and indirect Subsidiary of
Holdings to be subject at all times to a first priority, perfected Lien and
pledge in favor of Agent pursuant to the terms and conditions of this Agreement,
and the applicable Collateral Documents or other security documents as Agent
shall reasonably request.

 

Notwithstanding the foregoing, the Lien of Agent shall not extend to and
Collateral (or any asset or property comprising the Collateral) shall not
include the following Property (all of the following being the “Excluded
Assets”): (i) other than Accounts, any lease, license, permit or agreement to
which any Credit Party is a party to the extent, but only to the extent, that
such a grant would, under the terms of such lease, license, permit or agreement,
result in a breach of the terms of, invalidate, or constitute a default under,
such lease, license, permit or agreement or to the extent any requirement of law
prohibits the grant of a Lien thereon; (ii) any “intent to use” applications for
Trademarks for which a statement of use has not been filed and accepted with the
United States Patent and Trademark Office; (iii) those assets as to which Agent
determines in its Permitted Discretion the cost of obtaining a Lien therein in
favor of Agent or the perfection thereof are excessive in relation to the
benefit to the Lenders afforded by such Lien, (iv) equipment owned by a Credit
Party that is subject to a purchase money lien or Capitalized Lease permitted
hereunder, (v) any other Intellectual Property if, after giving effect to
Sections 9-406, 9-407, 9-408 or 9-409 of the UCC, the grant of a Lien or a
security interest in such Intellectual Property would result in the cancellation
or voiding of such Intellectual Property.

 

Furthermore, the Lien of Agent need not be perfected, until otherwise required
by the Agent or the Required Lenders, on vehicles which are subject to a
certificate of title law (collectively, the “Excluded Vehicles”).

 

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Section 4.2                                    Liens on Real Property;
Collateral Access Agreements.

 

(a)                                 In the event that any Credit Party or any
Subsidiary owns or hereafter acquires a fee estate in any real property, with a
fair market value in excess of $500,000 individually or in the aggregate for any
such real property, the Credit Parties shall, or shall cause such Subsidiary to,
execute and deliver to the Agent (or a security trustee therefor) a mortgage or
deed of trust reasonably acceptable in form and substance to the Agent for the
purpose of granting to the Agent, for the benefit of itself and the Lenders, a
Lien on such real property to secure the Obligations, shall pay all taxes,
costs, and expenses incurred by the Agent in recording such mortgage or deed of
trust, and shall supply to the Agent at Borrowers’ cost and expense a survey,
environmental report, hazard insurance policy, a flood determination report and,
if applicable, flood insurance satisfactory to the Lenders, and a mortgagee’s
policy of title insurance from a title insurer acceptable to the Agent insuring
the validity of such mortgage or deed of trust and its status as a first Lien
(subject to Permitted Liens) on the real property encumbered thereby and such
other instrument, documents, certificates, and opinions reasonably required by
the Agent in connection therewith.

 

(b)                                 As of the Second Restatement Closing Date,
the Credit Parties shall use commercially reasonable efforts to deliver to the
Agent a Collateral Access Agreement with respect to the chief executive office
(if leased) and each of the other locations set forth on Schedule 3.4 of the
Security Agreement where Credit Parties maintain books and records or Inventory
and Equipment with a fair market value in excess of $300,000. The Credit Parties
shall use commercially reasonable efforts to deliver Collateral Access
Agreements with respect to any new chief executive office (if leased)
established after the Second Restatement Closing Date, each location of original
books and records and, to the extent required by Section 4.3 of the Security
Agreement, each other Collateral location established after the Second
Restatement Closing Date where Credit Parties maintain books and records or
Inventory and Equipment with a fair market value in excess of $300,000.

 

Section 4.3                                    Guaranties.  The payment and
performance of the Obligations of each Credit Party shall at all times be
jointly and severally guaranteed by the Credit Parties and their Domestic
Subsidiaries.

 

Section 4.4                                    Further Assurances.  Each of the
Credit Parties agrees that it shall, and shall cause each Subsidiary (other than
an Excluded Subsidiary) to, from time to time at the request of the Agent or the
Required Lenders, execute and deliver such documents and do such acts and things
as the Agent or the Required Lenders may reasonably request in order to provide
for or perfect or protect such Liens on the Collateral.  In the event any Credit
Party or any Subsidiary forms or acquires any other Subsidiary after the date
hereof the Credit Parties shall (i) provide prior written notice to Agent as to
the creation of such Subsidiary and the purpose thereof, and (ii) forty-five
(45) days following such formation or acquisition cause such newly formed or
acquired Subsidiary to become a Borrower or Guarantor hereunder as Agent shall
direct and to execute and deliver to Agent a Joinder Agreement, Collateral
Documents and such other instruments, documents, certificates, and opinions
required by the Agent in connection therewith; provided that such requirement
shall not apply to a newly formed or acquired Foreign Subsidiary, if Borrower
Representative reasonably determines that such act could reasonably be

 

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expected to have adverse tax consequences to the Credit Parties so long as no
Collateral or Loan proceeds are transferred to such Foreign Subsidiary, as
provided in Section 6.24 hereof.

 

SECTION 5

 

REPRESENTATIONS AND WARRANTIES.

 

Each of the Credit Parties represents and warrants to each Lender and the Agent,
and agrees, that:

 

Section 5.1                                    Organization and Qualification. 
Each of the Credit Parties and each of their Subsidiaries (i) is duly organized,
validly existing and in good standing under the laws of the jurisdiction of its
organization, (ii) has the corporate or limited liability company power and
authority to own its property and to transact the business in which it is
engaged and proposes to engage and (iii) is duly qualified and in good standing
in each jurisdiction where the ownership, leasing or operation of property or
the conduct of its business requires such qualification, except where the
failure to be so qualified and in good standing could not be reasonably expected
to have, either individually or in the aggregate, a Material Adverse Effect.

 

Section 5.2                                    Authority and Enforceability. 
Each Credit Party has full right and authority to enter into this Agreement and
the other Loan Documents executed by it, to make Borrowings herein provided for,
to issue its Notes, to grant to the Agent, for the benefit of itself and the
Lenders, the Liens described in the Collateral Documents executed by such Credit
Party, and to perform all of its obligations hereunder and under the other Loan
Documents executed by it.  Each Credit Party has full right and authority to
enter into the Loan Documents executed by it, to guarantee the Obligations,
including, without limitation, Rate Management Obligations and Banking Services
Obligations, to grant to the Agent, for the benefit of itself and the Lenders,
the Liens described in the Collateral Documents executed by such Person, and to
perform all of its obligations under the Loan Documents executed by it.  The
Loan Documents delivered by each of the Credit Parties and by each Subsidiary,
if any, have been duly authorized, executed, and delivered by such Person and
constitute valid and binding obligations of such Person enforceable against it
in accordance with their terms, except as enforceability may be limited by
bankruptcy, insolvency, fraudulent conveyance or similar laws affecting
creditors’ rights generally and general principles of equity (regardless of
whether the application of such principles is considered in a proceeding in
equity or at law); and this Agreement and the other Loan Documents do not, nor
does the performance or observance by any Credit Party or any Subsidiary, if
any, of any of the matters and things herein or therein provided for,
(a) contravene or constitute a default under any provision of any material law
or any material judgment, injunction, order or decree binding upon any Credit
Party or any Subsidiary, if any, or any provision of the organizational
documents (e.g., charter, articles of incorporation, by-laws, articles of
association, operating agreement, partnership agreement or other similar
document) of any Credit Party or any Subsidiary, (b) contravene or constitute a
default under any covenant, indenture or agreement of or affecting any Credit
Party or any Subsidiary or any of such Person’s Property, in each case where
such contravention or default, individually or in the aggregate, could
reasonably be expected to have a Material Adverse Effect or (c) result in the
creation or imposition of any Lien on any Property of any Credit Party or any
Subsidiary other than the Liens granted in favor of the Agent pursuant to the
Collateral Documents.

 

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Section 5.3                                    Financial Reports.  The audited
consolidated financial statements of Holdings and its Subsidiaries as at
June 30, 2015, and the unaudited interim consolidated financial statements of
Holdings and its Subsidiaries as at March 27, 2016, for the nine (9) months then
ended (the “Interim Balance Sheet”), heretofore furnished to the Agent, have
been prepared in accordance with GAAP in all material respects (except in the
case of the Interim Balance Sheet, which is subject to year-end adjustments and
the absence of footnotes) applied on a consistent basis throughout the periods
covered thereby (except as noted therein), present fairly in all material
respects the financial condition of Holdings and its Subsidiaries as of such
dates and the results of operations and cash flows of Holdings and its
Subsidiaries for such periods, are correct and complete in all material
respects, and are consistent in all material respects with the books and records
of Holdings and its Subsidiaries.

 

Section 5.4                                    No Material Adverse Change. 
Since June 30, 2015, other than the IPO in July 2015, there has been no change
in the financial condition or operations of the Credit Parties and the
Subsidiaries taken as a whole, except those occurring in the ordinary course of
business, none of which individually or in the aggregate could reasonably be
expected to have a Material Adverse Effect.

 

Section 5.5                                    Litigation and Other
Controversies.  There is no litigation, arbitration or governmental proceeding
pending or, to the knowledge of any Credit Party and/or any Subsidiary,
threatened against any Credit Party or any Subsidiary that could reasonably be
expected to have a Material Adverse Effect.

 

Section 5.6                                    True and Complete Disclosure. 
All information furnished by or on behalf of any Credit Party or any Subsidiary
in writing to the Agent or any Lender for purposes of or in connection with this
Agreement, or any transaction contemplated herein, is, when taken as a whole,
true and accurate in all material respects and not incomplete by omitting to
state any fact necessary to make such information not misleading in light of the
circumstances under which such information was provided when taken as a whole;
provided that, with respect to projected financial information furnished by or
on behalf of the Credit Parties or any of their Subsidiaries, each of the Credit
Parties only represents and warrants that such information is prepared in good
faith based upon assumptions believed to be reasonable at the time prepared (it
being understood that no assurance can be given that such projections will be
realized and that actual results may differ from such projections).

 

Section 5.7                                    Use of Proceeds; Margin Stock. 
All proceeds of the Term Loans made on the Term Loan Funding Date shall be used
by Borrowers, together with a certain amount of cash on hand, and certain
Revolving Loans, for the payment of a dividend to Holdings on the Term Loan
Funding Date in the amount of $80,000,000 (“Second Restatement Dividend”) and
all proceeds of the Revolving Loans and Swing Loans, made after the Second
Restatement Closing Date, shall be used by Borrowers for working capital
purposes, including, without limitation, Capital Expenditures permitted
hereunder, and other general corporate purposes (and Permitted Acquisitions of
Borrowers and their Subsidiaries).  No part of the proceeds of any Loan or other
extension of credit hereunder will be used by any Borrower or any Subsidiary
thereof to purchase or carry any margin stock (within the meaning of Regulation
U of the Board of Governors of the Federal Reserve System, “Margin Stock”) or to
extend credit to others for the purpose of purchasing or carrying any Margin
Stock.  Neither the making of any Loan or other

 

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extension of credit hereunder nor the use of the proceeds thereof will violate
or be inconsistent with the provisions of Regulations T, U or X of the Board of
Governors of the Federal Reserve System and any successor to all or any portion
of such regulations.  Margin Stock (as defined above) constitutes less than 25%
of the value of those assets of the Credit Parties and their Subsidiaries that
are subject to any limitation on sale, pledge or other restriction hereunder.

 

Section 5.8                                    Taxes.  Each of the Credit
Parties and each of their Subsidiaries has timely filed or caused to be timely
filed all federal income Tax returns and all other material Tax returns required
to be filed by any Credit Party and/or any Subsidiary.  Each of the Credit
Parties and each Subsidiary has paid all federal income Taxes and all other
material Taxes, assessments and other governmental charges due and payable by
them (or any one or more of them) other than Taxes, assessments and other
governmental charges which are not delinquent, except those (a) that are being
contested in good faith and by proper legal proceedings, and (b) as to which
appropriate reserves have been provided for in accordance with GAAP.  There is
no proposed tax assessment (excluding any generally applicable changes in Tax
rates) against any Credit Party or any Subsidiary that would, if made, have a
Material Adverse Effect, nor is there any tax sharing agreement applicable to
any Credit Party or any Subsidiary that could reasonably be expect to result in
an Material Adverse Effect. As of the Second Restatement Closing Date, no
Borrower has any permanent establishment outside of the United States.

 

Section 5.9                                    ERISA.  (a) Each Plan of a Credit
Party is in compliance with the applicable provisions of ERISA, the Code and
other federal or state laws, except such noncompliance as could not reasonably
be expected to have, either individually or in the aggregate, a Material Adverse
Effect.  Each Pension Plan of a Credit Party that is intended to be a qualified
plan under Section 401(a) of the Code has received a favorable determination
letter or is subject to a favorable opinion letter from the IRS to the effect
that the form of such Plan is qualified under Section 401(a) of the Code and the
trust related thereto has been determined by the IRS to be exempt from federal
income tax under Section 501(a) of the Code, or an application for such a letter
is currently being processed by the IRS.  To the best knowledge of the Credit
Parties, nothing has occurred that would prevent or cause the loss of such
tax-qualified status as of the Second Restatement Closing Date;

 

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

 

(c)                                  (i) No ERISA Event has occurred with
respect to a Plan, and no Credit Party is aware of any fact, event or
circumstance that could reasonably be expected to constitute or result in an
ERISA Event with respect to any Pension Plan, in each case, that could
reasonably be expected to have a Material Adverse Effect; (ii) each Credit Party
has met all applicable requirements under the Pension Funding Rules in respect
of each Pension Plan of a Credit Party, and no waiver of the minimum funding
standards under the Pension Funding Rules has been applied for or obtained;
(iii) as of the most recent valuation date for any Plan of a Credit Party, the
funding target attainment percentage (as defined in Section 430(d)(2) of the
Code) is 60% or higher and no Credit Party knows of any facts or circumstances
that could reasonably be

 

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expected to cause the funding target attainment percentage for any such plan to
drop below 60% as of the most recent valuation date; (iv) no Credit Party has
incurred any liability to the PBGC other than for the payment of premiums, and
there are no premium payments which have become due that are unpaid; (v) no
Credit Party has incurred any liability under Section 4069 or Section 4212(c) of
ERISA; and (vi) no Pension Plan of a Credit Party has been terminated by the
plan administrator thereof nor by the PBGC, and no event or circumstance has
occurred or exists that could reasonably be expected to cause the PBGC to
institute proceedings under Title IV of ERISA to terminate any Pension Plan.

 

(d)                                 No Credit Party maintains or contributes to,
or has any unsatisfied obligation to contribute to, or liability under, any
active or terminated Pension Plan other than (i) on the Second Restatement
Closing Date, those listed on Schedule 5.9 hereto and (ii) thereafter, Pension
Plans not otherwise prohibited by this Agreement.

 

Section 5.10                             Subsidiaries.  Schedule 5.10 correctly
sets forth, as of the Second Restatement Closing Date, each Subsidiary of the
Credit Parties, its respective jurisdiction of organization and the percentage
ownership (direct and indirect) of such Credit Party in each class of capital
stock or other Equity Interests of each of its Subsidiaries and also identifies
the direct owner thereof.

 

Section 5.11                             Compliance with Laws.  Each of the
Credit Parties and each Subsidiary is in compliance with all applicable
statutes, regulations and orders of, and all applicable restrictions imposed by,
all Governmental Authorities in respect of the conduct of their businesses and
the ownership of their property, except such non-compliances as could not
reasonably be expected to have, either individually or in the aggregate, a
Material Adverse Effect.

 

Section 5.12                             Environmental Matters.  Each of the
Credit Parties and each Subsidiary is in compliance with all applicable
Environmental Laws and the requirements of any permits issued under such
Environmental Laws, except to the extent that the aggregate effect of all
non-compliances could not reasonably be expected to have a Material Adverse
Effect.  There are no pending or, to the best knowledge of any Credit Party or
any Subsidiary after due inquiry, threatened Environmental Claims, including any
such claims (regardless of materiality) for liabilities under CERCLA relating to
the disposal of Hazardous Materials, against any Credit Party or any Subsidiary
or any real property, including leaseholds, owned or operated by any Credit
Party or any Subsidiary, except such claims as could not reasonably be expected
to have, either individually or in the aggregate, a Material Adverse Effect. 
Except as could not reasonably be expected to have, either individually or in
the aggregate, a Material Adverse Effect, there are no facts, circumstances,
conditions or occurrences on any real property, including leaseholds, owned or
operated by any Credit Party or any Subsidiary that, to the best knowledge of
any Credit Party or any Subsidiary after due inquiry, could reasonably be
expected (i) to form the basis of an Environmental Claim against any Credit
Party or any Subsidiary or any such real property, or (ii) to cause any such
real property to be subject to any restrictions on the ownership, occupancy, use
or transferability of such real property by any Credit Party or any Subsidiary
under any applicable Environmental Law.  Hazardous Materials have not been
Released on or from any real property, including leaseholds, owned or operated
by any Credit

 

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Party or any Subsidiary where such Release, individually, or when combined with
other Releases, in the aggregate, may reasonably be expected to have a Material
Adverse Effect.

 

Section 5.13                             Investment Company.  No Credit Party
nor any Subsidiary is an “investment company” or a company “controlled” by an
“investment company” within the meaning of the Investment Company Act of 1940,
as amended.

 

Section 5.14                             Intellectual Property.  Each of the
Credit Parties and each Subsidiary owns all the Intellectual Property,
franchises or rights with respect to the foregoing, or each has obtained
licenses of all other rights of whatever nature necessary for the present
conduct of its businesses, in each case without any known conflict with the
rights of others which, or the failure to obtain which, as the case may be,
could reasonably be expected to result in a Material Adverse Effect.

 

Section 5.15                             Good Title.  Each of the Credit Parties
and each Subsidiary have good and marketable title, or valid leasehold
interests, to their assets necessary for the operation of its business as
reflected on the most recent consolidated balance sheet of the Credit Parties
and their Subsidiaries provided to the Agent (except for sales of assets in the
ordinary course of business, and such defects in title that could not reasonably
be expected to have, either individually or in the aggregate, a Material Adverse
Effect) and is subject to no Liens, other than Permitted Liens.

 

Section 5.16                             Labor Relations.  No Credit Party nor
any Subsidiary is engaged in any unfair labor practice that could reasonably be
expected to have a Material Adverse Effect.  There is (i) no strike, labor
dispute, slowdown or stoppage pending against any Credit Party or any Subsidiary
or, to the best knowledge of any Credit Party or any Subsidiary, threatened
against any Credit Party or any Subsidiary and (ii) to the best knowledge of the
Credit Parties and their Subsidiaries, no union representation proceeding is
pending with respect to the employees of any Credit Party or any Subsidiary. 
All collective bargaining agreements and similar labor relations agreements to
which any Credit Party is a party as of the Second Restatement Closing Date are
described on Schedule 5.16 hereto, together with the expiration date thereof,
and such Credit Party is in compliance with all such collective bargaining
agreements except to the extent that a failure to be in compliance would
reasonably be expected to result in a Material Adverse Effect.

 

Section 5.17                             Capitalization.  All outstanding Equity
Interests of the Credit Parties and the Subsidiaries have been duly authorized
and validly issued, and are fully paid and non-assessable. Schedule 5.17
describes (i) the capitalization of each of the Credit Parties, and (ii) any
outstanding commitments or other obligations of any Credit Party or any
Subsidiary to issue, and any rights of any Person to acquire, any Equity
Interests in any Credit Party or any Subsidiary.

 

Section 5.18                             Other Agreements.  No Credit Party nor
any Subsidiary is in default under (i) the Subordinated Debt Documents, or
(ii) the terms of any covenant, indenture or agreement of or affecting any
Credit Party, any Subsidiary or any of their respective Property, which default
if uncured could reasonably be expected to have a Material Adverse Effect.

 

Section 5.19                             Governmental Authority and Licensing. 
Each of the Credit Parties and their Subsidiaries have received all licenses,
permits, and approvals of each Governmental

 

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Authority necessary to conduct their businesses, in each case where the failure
to obtain or maintain the same could reasonably be expected to have a Material
Adverse Effect.  No investigation or proceeding that, if adversely determined,
could reasonably be expected to result in revocation or denial of any license,
permit or approval is pending or, to the knowledge of any Credit Party or any
Subsidiary, threatened, except where such revocation or denial could not
reasonably be expected to have, either individually or in the aggregate, a
Material Adverse Effect.

 

Section 5.20                             Approvals.  No authorization, consent,
license or exemption from, or filing or registration with, any Governmental
Authority, nor any approval or consent of any other Person, is or will be
necessary to the valid execution, delivery or performance by any Credit Party or
any Subsidiary of any Loan Document, except for the filing of UCC financing
statements and Intellectual Property security agreements and such approvals
which have been obtained prior to the date of this Agreement and remain in full
force and effect.

 

Section 5.21                             Affiliate Transactions.  No Credit
Party nor any Subsidiary is a party to any contracts or agreements with any of
its Affiliates (other than with Wholly-Owned Subsidiaries) on terms and
conditions which are less favorable to such Credit Party or such Subsidiary than
would be usual and customary in similar contracts or agreements between Persons
not affiliated with each other, other than as permitted pursuant to Section 6.8
hereof.

 

Section 5.22                             Solvency.  The Credit Parties and their
Subsidiaries, taken as a whole, are able to generally pay their debts as they
become due in the ordinary course of business and do not have an unreasonably
small amount of capital with which to carry on their businesses; and the amount
that will be required to pay the probable liabilities of the Credit Parties and
their Subsidiaries as they become absolute and mature in the ordinary course of
business is less than the sum of the present fair sale value of their assets
valued on a going concern basis.

 

Section 5.23                             No Broker Fees.  No broker’s or
finder’s fee or commission will be payable with respect hereto or any of the
transactions contemplated hereby; and each of the Credit Parties hereby agrees
to indemnify the Agent and the Lenders against, and agree that they will hold
the Agent and the Lenders harmless from, any claim, demand, or liability for any
such broker’s or finder’s fees alleged to have been incurred in connection
herewith or therewith and any expenses (including reasonable and documented
attorneys’ fees) arising in connection with any such claim, demand, or
liability.

 

Section 5.24                             PATRIOT Act; Foreign Corrupt Practices
Act.

 

(a)                                 Each Credit Party and its subsidiaries are
in compliance with the (i) Trading with the Enemy Act, and each of the foreign
assets control regulations of the United States Treasury Department (31 CFR,
Subtitle B, Chapter V, as amended) and any other enabling legislation or
executive order relating thereto, and (ii) Uniting and Strengthening America by
Providing Appropriate Tools Required to Intercept and Obstruct Terrorism (USA
PATRIOT Act of October 26, 2001) (the “PATRIOT Act”).

 

(b)                                 No Credit Party nor any of its domestic
Subsidiaries nor, to the knowledge of any Credit Party, any director, officer,
agent, employee or other person acting on behalf of any

 

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Credit Party or any of its domestic subsidiaries has taken any action, directly
or indirectly, that would result in a violation by such persons of the Foreign
Corrupt Practices Act of 1977, as amended, and the rules and regulations
thereunder (the “FCPA”) or any other applicable anti-corruption law; and the
Credit Parties have instituted and maintain policies and procedures designed to
ensure continued compliance therewith. No part of the proceeds of the Loans will
be used, directly or indirectly, for any payments to any governmental official
or employee, political party, official of a political party, candidate for
political office, or anyone else acting in an official capacity, in order to
obtain, retain or direct business or obtain any improper advantage, in violation
of the FCPA.

 

(c)                                  Neither any Credit Party nor any Subsidiary
or any Affiliate thereof is in violation of any of the OFAC Sanctions.  Neither
any Credit Party nor any subsidiary thereof, nor to the knowledge of such Credit
Party or any of its subsidiaries, any director, officer, employee, agent,
Affiliate or representative thereof (i) is a Sanctioned Person or a Sanctioned
Entity, (ii) has its assets located in a Sanctioned Entity, (iii) derives
revenues from investments in, or transactions with a Sanctioned Person or a
Sanctioned Entity or (iv) is owned or controlled by a Sanctioned Entity or a
Sanctioned Person.

 

Section 5.25                             [Reserved].

 

Section 5.26                             Security Interest in Collateral.  The
provisions of the Collateral Documents create and continue legal and valid Liens
on all the Collateral in favor of the Agent, for the benefit of the Agent and
the Lenders, and such Liens constitute perfected and continuing Liens on the
Collateral, securing the Obligations, enforceable against the applicable Credit
Party and all third parties (except as enforceability may be limited by
bankruptcy, insolvency, fraudulent conveyance or similar laws affecting
creditors’ rights generally and general principles of equity (regardless of
whether the application of such principles is considered in a proceeding in
equity or at law), and having priority over all other Liens on the Collateral
except, in the case of Permitted Liens, to the extent any such Permitted Liens
would have priority over the Liens in favor of the Agent pursuant to any
applicable law or agreement.

 

Section 5.27                             Common Enterprise.  The successful
operation and condition of each of the Credit Parties is dependent on the
continued successful performance of the functions of the group of the Credit
Parties as a whole and the successful operation of each of the Credit Parties is
dependent on the successful performance and operation of each other Credit
Party.  Each Credit Party expects to derive benefit (and its board of directors
or other governing body has determined that it may reasonably be expected to
derive benefit), directly and indirectly, from (i) successful operations of each
of the other Credit Parties and (ii) the credit extended by the Lenders to
Borrowers hereunder, both in their separate capacities and as members of the
group of companies.  Each Credit Party has determined that execution, delivery,
and performance of this Agreement and any other Loan Documents to be executed by
such Credit Party is within its purpose, in furtherance of its direct and/or
indirect business interests, will be of direct and/or indirect benefit to such
Credit Party, and is in its best interest.

 

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SECTION 6

 

COVENANTS.

 

Each of the Credit Parties covenants and agrees that, so long as any Credit is
available to Borrowers hereunder and until the Payment in Full of the
Obligations:

 

Section 6.1                                    Information Covenants.  The
Credit Parties will furnish to the Agent and each Lender:

 

(a)                                 [Reserved]

 

(b)                                 Quarterly Reports.  As soon as available
(but only if Holdings is no longer required under the Exchange Act to file
periodic reports with the SEC, e.g. Quarterly Reports on Form 10-Q), and in any
event within the earlier of (i) five (5) days after such related filing (if any)
is due, and (ii) thirty (30) days after the end of each fiscal quarter of the
Credit Parties and their Subsidiaries, the consolidated and consolidating
balance sheet of the Credit Parties and their Subsidiaries as at the end of such
fiscal quarter and the related consolidated and consolidating statements of
income and retained earnings and of cash flows for such fiscal quarter and for
the elapsed portion of the fiscal year-to-date period then ended, each in
reasonable detail, prepared by the Credit Parties in accordance with GAAP, in
all material respects (subject to year-end audit adjustments, the absence of
footnotes and treatment of research and development), setting forth comparative
figures for the corresponding fiscal quarter in the prior fiscal year and
comparable budgeted figures for such fiscal quarter, all of which shall be
certified by the chief financial officer or other officer of the Credit Parties
acceptable to the Agent that they fairly present in all material respects in
accordance with GAAP the financial condition of the Credit Parties and their
Subsidiaries as of the dates indicated and the results of their operations and
changes in their cash flows for the periods indicated, subject to normal
year-end audit adjustments and the absence of footnotes.

 

(c)                                  Annual Statements.  As soon as available
(but only if Holdings is no longer required under the Exchange Act to file
periodic reports with the SEC, e.g. Annual Reports on Form 10-K), and in any
event within the earlier of (i) five (5) days after such related filing (if any)
is due, and (ii) within one hundred twenty (120) days after the close of each
fiscal year of the Credit Parties and their Subsidiaries, rules and regulations
(as provided in Section 6.1(i) hereof) after the close of each fiscal year of
the Credit Parties and their Subsidiaries, a copy of the consolidated and
consolidating balance sheet of the Credit Parties and their Subsidiaries as of
the last day of the fiscal year then ended and the consolidated and
consolidating statements of income, retained earnings, and cash flows of the
Credit Parties and their Subsidiaries for the fiscal year then ended, and
accompanying notes thereto, each in reasonable detail showing in comparative
form the figures for the previous fiscal year, accompanied by an unqualified
opinion of a firm of independent public accountants of recognized national
standing, selected by the Credit Parties and acceptable to the Agent, to the
effect that the consolidated financial statements have been prepared in
accordance with GAAP and present fairly in accordance with GAAP the consolidated
financial condition of the Credit Parties and their Subsidiaries as of the close
of such fiscal year and the results of their operations and cash flows for the
fiscal year then ended and that an examination of such accounts in

 

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connection with such financial statements has been made in accordance with
generally accepted auditing standards.

 

(d)                                 Officer’s Certificates; Reports

 

(i)                                     Within the earlier of (x) thirty (30)
days after the end of each fiscal quarter of the Credit Parties and their
Subsidiaries, and (y) concurrently with the delivery of the financial statements
provided for in Section 6.1(b), (A) a certificate of the chief financial officer
or other officer of the Credit Parties acceptable to the Agent in the form of
Exhibit E (a “Compliance Certificate”) (1) stating that no Default or Event of
Default has occurred during the period covered by such statements or, if a
Default or Event of Default exists, a detailed description of the Default or
Event of Default and all actions any Credit Party is taking with respect to such
Default or Event of Default, (2) confirming that the representations and
warranties stated in Section 5 of this Agreement and in the other Loan Documents
are true and correct in all material respects (provided that if any
representation or warranty is by its terms qualified by concepts of materiality,
such representation and warranty shall be true and correct in all respects) as
though made on and as of date thereof (except to the extent such representations
and warranties relate to an earlier date, in which case they are true and
correct in all respects as of such date), (3) showing the Credit Parties’
compliance with the covenants set forth in Section 6.22 and calculation of the
Revolving Loan Limit, and (4) providing a summary of Credit Parties’ and their
Subsidiaries’ contingent liabilities or judgments, order or injunctions against
any one or more of them that are material to any one or more of them other than
as indicated on the corresponding financial statements delivered pursuant
hereto, and (B) a comparison of the current year-to-date financial results
(other than in respect of the balance sheets included therein) against the
budgets required to be submitted pursuant to clause 6.1(d).

 

(ii)                                  Within thirty (30) days after the end of
each month and, if any Default or Event of Default has occurred and is
continuing, at such other times as may be requested by Agent, a Compliance
Certificate showing the calculation of the Revolving Loan Limit.

 

(e)                                  Budgets.  As soon as available, but in any
event at least sixty (60) days after the first day of each fiscal year of the
Credit Parties and their Subsidiaries, a budget in form reasonably satisfactory
to the Agent (including, without limitation, a breakdown of the projected
results of each line of business of the Credit Parties and their Subsidiaries,
and budgeted consolidated and consolidating statements of income, and sources
and uses of cash and balance sheets for Credit Parties and their Subsidiaries)
of Credit Parties and their Subsidiaries in reasonable detail reasonably
satisfactory to the Agent for each fiscal month and the four fiscal quarters of
the immediately succeeding fiscal year and, with appropriate discussion, the
principal assumptions upon which such budget is based.

 

(f)                                   Notice of Default or Litigation;
Collateral.  Promptly, and in any event within three (3) Business Days after any
Responsible Officer of any Credit Party obtains knowledge thereof, notice of
(i) the occurrence of any event which constitutes a Default or an Event of
Default or any other event which could reasonably be expected to have a Material

 

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Adverse Effect, which notice shall specify the nature thereof, the period of
existence thereof and what action Credit Parties propose to take with respect
thereto, (ii) the commencement of, or threat of, or any significant development
in, any litigation, labor controversy, arbitration or governmental proceeding
pending against any Credit Party or any Subsidiary which, if adversely
determined, could reasonably be expected to have a Material Adverse Effect or
(iii) other than a Permitted Lien, any claim or Lien securing a claim, in excess
of $250,000 is asserted or made against any of the Collateral or any loss,
damage or destruction of Collateral in the amount of $250,000 or more, whether
or not covered by insurance.

 

(g)                                  Management Letters.  Promptly, and in any
event within five (5) Business Days after any Credit Party’s receipt thereof, a
copy of each report or any “management letter” submitted to any Credit Party or
any Subsidiary by its certified public accountants and the management’s
responses thereto.

 

(h)                                 Environmental Matters.  Promptly upon, and
in any event within five (5) Business Days after any officer of any Credit Party
obtains knowledge thereof, notice of one or more of the following environmental
matters which individually, or in the aggregate, may reasonably be expected to
have a Material Adverse Effect:  (i) any notice of Environmental Claim against
any Credit Party or any Subsidiary or any real property owned or operated by any
Credit Party or any Subsidiary; (ii) any condition or occurrence on or arising
from any real property owned or operated by any Credit Party or any Subsidiary
that (a) results in noncompliance by any Credit Party or any Subsidiary with any
applicable Environmental Law or (b) could reasonably be expected to form the
basis of an Environmental Claim against any Credit Party or any Subsidiary or
any such real property; (iii) any condition or occurrence on any real property
owned or operated by any Credit Party or any Subsidiary that could reasonably be
expected to cause such real property to be subject to any restrictions on the
ownership, occupancy, use or transferability by any Credit Party or any
Subsidiary of such real property under any Environmental Law; and (iv) any
removal or remedial actions to be taken in response to the actual or alleged
presence of any Hazardous Material on any real property owned or operated by any
Credit Party or any Subsidiary as required by any Environmental Law or any
Governmental Authority.  All such notices shall describe in reasonable detail
the nature of the claim, investigation, condition, occurrence or removal or
remedial action and such Credit Party’s or such Subsidiary’s response thereto. 
In addition, each of the Credit Parties agrees to provide to Agent and the
Lenders copies of all material written communications by any Credit Party or any
Subsidiary with any Person or Governmental Authority relating to any of the
matters set forth in clauses (i)-(iv) above, and such detailed reports relating
to any of the matters set forth in clauses (i)-(iv) above as may reasonably be
requested by the Agent or the Required Lenders.

 

(i)                                     Public Filings.  Promptly after the same
is publically available, one copy of each financial statement, report, notice or
proxy statement sent or made available by any Credit Party or Subsidiary to its
stockholders generally, and within the time period specified in the SEC’s
rules and regulations, annual reports on Form 10-K, Quarterly Reports on
Form 10-Q, Current Reports on Form 8-K (or any successor or comparable form) and
other information required to be filed with or furnished to the SEC, in each
case containing the information required to be contained therein (or required in
such successor or comparable form) and that are required to be filed with or
furnished to the SEC by any Credit Party or Subsidiary.  Contemporaneously with
the delivery by the Credit Parties of the Quarterly Reports on Form 10-

 

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Q and the Annual Reports on Form 10-K, the Credit Parties shall deliver to Agent
and each Lender a Compliance Certificate that includes the requirements set
forth in Section 6.1(d)(i) (A)  & (B). So long as Holdings is required to file
periodic reports under Section 13(a) or Section 15(d) of the Exchange Act,
Holdings may satisfy its obligations to deliver the financial statements
described in Sections 6.1(b) and 6.1(c) by electronic mail or internet posting
as agreed between Agent and Holdings. Each of the Credit Parties agrees to
provide to Agent and the Lenders all material notifications received from the
SEC pursuant to the Exchange Act.  Holdings shall include Agent and the Lenders
on its standard distribution lists for all press releases made available
generally to the public concerning material developments in the business of
Holdings or any Credit Party.

 

(j)            Third Party Collateral Locations Reporting and Collateral Access
Language. As set forth in Section 4.3 of the Security Agreement, in connection
with Inventory or Equipment comprised of boats and trailers held by third
parties in connection with promotional boat arrangements or endorsement
arrangements or otherwise, such Grantor shall take the following actions: 
(i) provide to Agent a written report, as of each fiscal quarter (to be
delivered within thirty (30) days after the end of each fiscal quarter of the
Credit Parties together with the other quarterly reports required by
Section 6.1(b) of this Agreement) that describes in detail all Inventory or
Equipment comprised of boats and/or trailers that are held by third parties
pursuant to such promotional arrangements or endorsement arrangements,
including, without limitation, the name of such person or entity in possession
thereof, the common address and location, and the boat model and serial numbers
for such boat and trailer, the value of such boat and trailer, whether or not
such arrangement is evidence by a written agreement, and a description of the
date and term of such agreement if applicable, with such report otherwise in
form and substance reasonably satisfactory to Agent; and  (ii) use commercially
reasonable efforts to cause the third party in possession thereof to enter into
a Collateral Access Agreement with Agent or, to the extent that such Grantor
enters into a promotional boat agreement, endorsement agreement or similar
agreement with such party, cause collateral access language, substantially
similar to that set forth in Schedule 4.3 to the Security Agreement, to be
included in such agreement.

 

(k)           Other Information.  From time to time, such other information or
documents (financial or otherwise) as the Agent or any Lender may reasonably
request.

 

Section 6.2            Inspections; Books and Records..  Each of the Credit
Parties will, and will cause each Subsidiary to, (a) keep proper books of record
and account in which full, true and correct entries are made of all material
dealings and transactions in relation to its business and activities and
(b) permit officers, representatives and agents of the Agent or any Lender, to
visit and inspect any Property of any Credit Party or any Subsidiary, and to
examine the books of account of such Credit Party or such Subsidiary and discuss
the affairs, finances and accounts of such Credit Party or such Subsidiary with
its and their officers and independent accountants, all at such reasonable times
as the Agent or any Lender may request; provided that, (i) prior written notice
of any such visit, inspection or examination shall be provided to Borrower
Representative, (ii) such visit, inspection or examination shall be performed at
reasonable times to be agreed to by Borrower Representative, which agreement
will not be unreasonably withheld, (iii) the Credit Parties shall pay the
reasonable out-of-pocket costs and expenses of such visit, inspection or
examination, and (iv) so long as no Event of Default exists, the Agent and the
Lenders shall only be entitled to one (1) such visit, inspection or examination
per fiscal year of Borrowers.

 

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Section 6.3            Maintenance of Property, Insurance, Environmental
Matters, etc.

 

(a)           Each of the Credit Parties will, and will cause each of its
Subsidiaries to, keep its property, plant and equipment in good repair, working
order and condition, normal wear and tear excepted, and shall from time to time
make all needful and proper repairs, renewals, replacements, extensions,
additions, betterments and improvements thereto so that at all times such
property, plant and equipment are reasonably preserved and maintained.

 

(b)           (i)  Each of the Credit Parties will, and will cause each of its
Subsidiaries to, maintain, with good and responsible insurance companies, such
insurance coverage as may be required by any law or governmental regulation or
court decree or order applicable to it and such other insurance, to such extent
and against such hazards and liabilities, as is customarily maintained by
companies similarly situated (including, without limitation, business
interruption, employers’ and public liability risks), in such amounts and with
such deductibles as is customarily maintained by companies similarly situated
and reasonably acceptable to the Agent; and, upon request of the Agent or any
Lender, furnish to the Agent or such Lender original or electronic copies of
policies evidencing such insurance, and a certificate setting forth in
reasonable detail the nature and extent of all insurance maintained by such
Credit Party or such Subsidiary.  The Credit Parties shall cause each issuer of
an insurance policy to provide the Agent with a copy of endorsements (A) showing
the Agent as lender’s loss payable with respect to each policy of property or
casualty insurance and naming the Agent as an additional insured with respect to
each policy of liability insurance and business interruption insurance,
(B) providing that thirty (30) days’ notice will be given to the Agent prior to
any cancellation of, material reduction or change in coverage provided by or
other material modification to such policy  for any statutorily permitted reason
other than non-payment of premium, and 10 days’ notice for cancellation due to
non-payment of premium, and (C) reasonably acceptable in all other respects to
the Agent.  (ii) UNLESS THE CREDIT PARTIES PROVIDE THE AGENT WITH EVIDENCE OF
THE INSURANCE COVERAGE REQUIRED BY THIS AGREEMENT, THE AGENT MAY PURCHASE
INSURANCE AT BORROWER’S EXPENSE TO PROTECT THE AGENT’S AND THE LENDERS’
INTERESTS IN THE COLLATERAL.  THIS INSURANCE MAY, BUT NEED NOT, PROTECT ANY
CREDIT PARTY’S OR SUBSIDIARY’S INTERESTS.  THE COVERAGE THAT THE AGENT PURCHASES
MAY NOT PAY ANY CLAIM THAT IS MADE AGAINST SUCH CREDIT PARTY OR SUCH SUBSIDIARY
IN CONNECTION WITH THE COLLATERAL.  BORROWER MAY LATER CANCEL ANY INSURANCE
PURCHASED BY THE AGENT, BUT ONLY AFTER PROVIDING THE AGENT WITH EVIDENCE THAT
THE CREDIT PARTIES HAVE OBTAINED INSURANCE AS REQUIRED BY THIS AGREEMENT.  IF
THE AGENT PURCHASES INSURANCE FOR THE COLLATERAL, BORROWER WILL BE RESPONSIBLE
FOR THE COSTS OF THAT INSURANCE, INCLUDING INTEREST AND ANY OTHER CHARGES THAT
MAY BE IMPOSED WITH THE PLACEMENT OF THE INSURANCE, UNTIL THE EFFECTIVE DATE OF
THE CANCELLATION OR EXPIRATION OF THE INSURANCE.  THE COSTS OF THE INSURANCE
MAY BE ADDED TO THE PRINCIPAL AMOUNT OF THE LOANS OWING HEREUNDER.  THE COSTS OF
THE INSURANCE MAY BE MORE THAN THE COST OF THE INSURANCE ANY SUCH CREDIT PARTY
AND ANY SUCH SUBSIDIARY MAY BE ABLE TO OBTAIN ON THEIR OWN.

 

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(c)           Without limiting the generality of Section 6.3(a), each of the
Credit Parties and their Subsidiaries: (i) shall comply with, and maintain all
real property in compliance with, any applicable Environmental Laws, except to
the extent that the aggregate effect of all compliance failures could not
reasonably be expected to have a Material Adverse Effect; (ii) shall obtain and
maintain in full force and effect all governmental approvals required for its
operations at or on its properties by any applicable Environmental Laws except
to the extent any failure to obtain or maintain such approvals could not
reasonably be expected to have a Material Adverse Effect; (iii) shall cure as
soon as reasonably practicable any violation of applicable Environmental Laws
with respect to any of its properties which individually or in the aggregate
could reasonably be expected to have a Material Adverse Effect; (iv) shall not,
and shall not permit any other Person to, own or operate on any of its owned or
operated real property, including leaseholds, any landfill or dump site which is
used for the ultimate disposal of solid waste; (v) shall not, and shall not
permit any other Person to, own or operate any or hazardous waste treatment,
storage or disposal facility as defined pursuant to the RCRA, or any comparable
state law, at any real property owned or operated by the Credit Parties or its
Subsidiaries, except when undertaken in material compliance with all applicable
Environmental Laws; and (vi) shall not use, generate, treat, store, Release or
dispose of Hazardous Materials at or on any of the real property except in the
ordinary course of its business and in material compliance with all
Environmental Laws.  With respect to any material Release of Hazardous Materials
occurring at any real property owned or operated by the Credit Parties or its
Subsidiaries, including leaseholds, each of the Credit Parties and their
Subsidiaries shall conduct any necessary or required investigation, study,
sampling and testing, and undertake any cleanup, removal, remedial or other
response action necessary to remove, cleanup or abate any material quantity of
Hazardous Materials released at or on any of its properties, which  in each case
is required by any applicable Environmental Law.

 

Section 6.4            Preservation of Existence.  Each of the Credit Parties
will, and will cause each Subsidiary to, (a) do or cause to be done all things
necessary to (i) preserve, renew and keep in full force and effect its legal
existence, the material rights, qualifications, licenses, permits, franchises,
governmental authorizations, intellectual property rights, licenses and permits
material to the conduct of its business, and (ii) maintain all requisite
authority to conduct its business in each jurisdiction in which its business is
conducted, except where the failure to maintain such authority could not
reasonably be expected to have a Material Adverse Effect, provided that the
foregoing shall not prohibit any merger, consolidation, liquidation or
dissolution permitted under Section 6.13, and (b) carry on and conduct its
business in substantially the same fields of enterprise as it is conducted as of
the Second Restatement Closing Date and reasonable extensions thereof.

 

Section 6.5            Compliance with Laws.  Each of the Credit Parties shall,
and shall cause each Subsidiary to, comply in all respects with the requirements
of all laws, rules, regulations, ordinances and orders applicable to its
property or business operations of any Governmental Authority, where any such
non-compliance, individually or in the aggregate, could reasonably be expected
to have a Material Adverse Effect or result in a Lien upon any of its Property.

 

Section 6.6            ERISA.  Each of the Credit Parties shall, and shall cause
each Subsidiary to, promptly notify the Agent and each Lender of the occurrence
of any ERISA Event that could reasonably be expected to have a Material Adverse
Effect.

 

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Section 6.7            Payment of Taxes and Other Obligations.  Each of the
Credit Parties will, and will cause each of its Subsidiaries to, pay and
discharge as the same shall become due and payable all of its obligations and
liabilities, including (a) all federal income Taxes and other material Taxes,
assessments, fees and other governmental charges imposed upon it or any of its
Property, before becoming delinquent and before any penalties accrue thereon,
unless and to the extent that (i) the same are being contested in good faith and
by proper proceedings, and (ii) the Credit Party or Subsidiary, as applicable,
has established appropriate reserves in accordance with GAAP, (b) all lawful
claims which, if unpaid, would by law become a Lien upon its property; and
(c) all Indebtedness, as and when due and payable, but subject to any
subordination provisions contained in any instrument or agreement evidencing
such Indebtedness.

 

Section 6.8            Transactions with Affiliates.  No Credit Party shall, nor
shall it permit any Subsidiary to, enter into any contract, agreement or
business arrangement with any of its Affiliates on terms and conditions which
are less favorable to such Credit Party or such Subsidiary than would be usual
and customary in similar contracts, agreements or business arrangements between
Persons not affiliated with each other, except (a) transactions between or among
any Borrower and any Subsidiary that is a Credit Party not involving any other
Affiliate, (b) any investment permitted by Section 6.14(e), (c) any Restricted
Payment permitted by Section 6.15, (d) loans or advances to employees permitted
under Section 6.14, (e) the payment of reasonable fees and expense
reimbursements to directors of any Borrower or any Subsidiary who are not
employees of any Borrower or any Subsidiary, and compensation and employee
benefit arrangements paid to, and indemnities provided for the benefit of,
directors, officers or employees of any Borrower or its Subsidiaries in the
ordinary course of business, (f) any issuances of securities or other payments,
awards or grants in cash, securities or otherwise pursuant to, or the funding
of, employment agreements, stock options and stock ownership plans approved by
any Borrower’s board of directors, and (g) any contribution to the capital of
Holdings by the Sponsor Entities or any purchase of Equity Interests of Holdings
by the Sponsor Entities. Any Credit Party may also pay indemnities and expense
reimbursements it is required to pay under the Management Fee Agreement provided
that no Default or Event of Default then exists or would result after taking
into effect any such payment.

 

Section 6.9            Sale and Leaseback Transactions.  No Credit Party will,
nor will it permit any Subsidiary to, enter into any arrangement, directly or
indirectly, whereby it shall sell or transfer any property, real or personal,
used or useful in its business, whether now owned or hereafter acquired, and
thereafter rent or lease such property or other property that it intends to use
for substantially the same purpose or purposes as the property sold or
transferred, except for any such sale of any fixed or capital assets by Credit
Parties or any such Subsidiary that is made for cash consideration in an amount
not less than the fair value of such fixed or capital asset and is consummated
within 90 days after such Credit Party or such Subsidiary acquires or completes
the construction of such fixed or capital asset

 

Section 6.10          Interest Rate Protection.  (a) No Credit Party will, nor
will it permit any  Subsidiary to, enter into any Rate Management Agreement,
except (a) Rate Management Agreements entered into to hedge or mitigate risks to
which the Credit Party or Subsidiary has actual exposure (other than those in
respect of Equity Interests of Borrower or any of its Subsidiaries), and
(b) Rate Management Agreements entered into in order to effectively cap, collar
or exchange interest rates (from fixed to floating rates, from one floating rate
to another

 

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floating rate or otherwise) with respect to any interest-bearing liability or
investment of the Credit Party or any Subsidiary.

 

(b)           Within ninety (90) days after the Term Loan Funding Date,
Borrowers shall hedge their interest rate risk on 50% of the principal amount of
the Term Loan for a period of twenty-four (24) months (collectively, the
“Notional Amount”) through the use of one or more interest Rate Management
Agreements with one or more financial institutions acceptable to Agent to
effectively limit the amount of interest that Borrowers must pay on the Notional
Amount to not more than a rate reasonably acceptable to the Agent and such Rate
Management Agreements shall be outstanding for a period of not less than 2
years; provided that, notwithstanding the foregoing, no such hedge or Rate
Management Agreements shall be required if the Notional Amount of the Term Loan
is less than or equal to $25,000,000.

 

Section 6.11          Indebtedness.  No Credit Party shall, nor shall it permit
any Subsidiary to, contract, create, incur, assume or suffer to exist any
Indebtedness, including, without limitation, any guaranty with respect to the
Indebtedness of any Person, except:

 

(a)           the Obligations, including, without limitation, Rate Management
Obligations and Banking Services Obligations, of the Credit Parties and their
Subsidiaries owing to the Agent and the Lenders (and their Affiliates);

 

(b)           Indebtedness existing on the date hereof and set forth in
Schedule 6.11 and any Permitted Refinancing Indebtedness with respect thereto;

 

(c)           purchase money Indebtedness and Capitalized Lease Obligations of
Borrowers and their Subsidiaries in an amount not to exceed $2,000,000 in the
aggregate at any one time outstanding and any Permitted Refinancing Indebtedness
with respect thereto;

 

(d)           Indebtedness of any Borrower to any Subsidiary that is a Borrower
and of any Subsidiary that is a Borrower to any Borrower, provided that any such
Indebtedness shall be unsecured and subordinated to the Obligations pursuant to
Section 10.22 hereof;

 

(e)           Contingent Obligations of any Credit Party of Indebtedness of any
other Credit Party, provided that (i) any Indebtedness so guaranteed is
permitted by this Section 6.11, and (ii) Contingent Obligations permitted under
this clause (e) shall be subordinated to the Obligations of the applicable
Subsidiary on the same terms as the Indebtedness so guaranteed is subordinated
to the Obligations;

 

(f)            [Reserved];

 

(g)           to the extent incurred in connection with, and actually used to
consummate, a Permitted Acquisition, unsecured Indebtedness (including seller
debt and earnouts) subordinated in right of payment and having payment
restrictions acceptable to Agent, pursuant to documentation reasonably
satisfactory to the Agent, all at the time it is incurred;

 

(h)           unsecured Indebtedness of Borrowers and their Subsidiaries not
otherwise permitted by this Section in an amount not to exceed $1,000,000 in the
aggregate at any one time outstanding and any Permitted Refinancing Indebtedness
with respect thereto;

 

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(i)            contingent obligations arising from agreements of any Credit
Party for customary indemnification obligations in favor of sellers and any
adjustment of purchase price or acquisition price or similar obligations
(excluding earn-outs) incurred in connection with Permitted Acquisitions; and

 

(j)            Floorplan Repurchase Obligations.

 

Section 6.12          Liens.  No Credit Party shall, nor shall it permit any
Subsidiary to, create, incur or suffer to exist any Lien on any of its Property;
provided that the foregoing shall not prevent the following (the Liens described
below, the “Permitted Liens”):

 

(a)           inchoate Liens for the payment of Taxes which are not yet due and
payable or the payment of which is not required by Section 6.7;

 

(b)           Liens arising by statute or with respect to bonds obtained in
connection with worker’s compensation, unemployment insurance, old-age benefits,
social security obligations, assessments, statutory obligations or other similar
charges (other than Liens arising under ERISA), good-faith cash deposits or
bonds obtained in connection with tenders, contracts or leases to which any
Borrower or any Subsidiary is a party or other cash deposits required to be made
in the ordinary course of business, provided in each case that the obligation is
not for borrowed money and that the obligation secured is not overdue or, if
overdue, is being contested in good faith by appropriate proceedings which
prevent enforcement of the Lien with respect to such matter under contest and
adequate reserves have been established therefor;

 

(c)           mechanics’, workmen’s, materialmen’s, landlords’, carriers’,
warehousemen’s, processors’, suppliers’ or other similar Liens arising in the
ordinary course of business with respect to obligations which are not delinquent
for more than 60 days or which are being contested in good faith by appropriate
proceedings which prevent enforcement of the matter under contest;

 

(d)           Liens created by or pursuant to this Agreement and the Collateral
Documents;

 

(e)           Liens on property of any Borrower or any Subsidiary created solely
for the purpose of securing indebtedness permitted by Section 6.11(c) hereof,
representing or incurred to finance the purchase price of Property (including
replacement Liens on the Property currently subject to such Liens), provided
that no such Lien shall extend to or cover other Property of any Borrower or
such Subsidiary other than the respective Property so acquired and the proceeds
thereof, and the principal amount of indebtedness secured by any such Lien shall
at no time exceed the purchase price of such Property (including taxes, shipping
and installation charges), as reduced by repayments of principal thereon;

 

(f)            zoning restrictions, easements, rights-of-way, licenses,
covenants and other similar encumbrances against real Property incurred in the
ordinary course of business which, in the aggregate, are not substantial in
amount and which do not materially detract from the value of the Property
subject thereto or materially interfere with the ordinary conduct of the
business of any Credit Party or any Subsidiary;

 

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(g)           “bankers” liens arising by operation of law in respect of any
deposit accounts of any Credit Party or any Subsidiary that are maintained in
accordance with the terms of this Agreement;

 

(h)           Liens arising out of the existence or the bonding of any
judgments, writs or similar processes not giving rise to an Event of Default
under Section 7.1(g); provided that the execution or other enforcement of such
Liens is effectively stayed and the claims secured thereby are the subject of a
contest maintained in good faith by appropriate proceedings diligently conducted
and with respect to which such reserve or other appropriate provision, if any,
as shall be required in conformity with GAAP shall have been made;

 

(i)            any Lien on any property or asset of any Borrower or any
Subsidiary existing on the date hereof and set forth in Schedule 6.12;
(including replacement Liens on the property or asset currently subject to such
Lien); provided that (i) such Lien shall not apply to any other Property of any
Borrower or Subsidiary and (ii) such Lien shall secure only those obligations
which it secures on the date hereof;

 

(j)            Liens arising from precautionary UCC financing statements filed
under any operating lease permitted hereunder;

 

(k)           Liens of counterparties attaching solely to cash earnest money
deposits made by any Credit Party or any of their respective Subsidiaries in
connection with any letter of intent or purchase agreement entered into with
respect to Capital Expenditures or Acquisitions otherwise permitted hereunder;

 

(l)            [Reserved]; and

 

(m)          Liens not described above securing Indebtedness (other than
Indebtedness for borrowed money) of any Credit Party or any Subsidiary in an
aggregate outstanding amount at any time not to exceed $250,000.

 

Section 6.13          Consolidation, Merger, Sale of Assets, etc.  No Credit
Party shall, nor shall it permit any Subsidiary to, wind up, liquidate or
dissolve its affairs or agree to any merger or consolidation, or convey, sell,
lease or otherwise dispose of all or any part of its property, including any
disposition as part of any sale-leaseback transactions, except that this
Section shall not prevent:

 

(a)           the sale and lease of inventory in the ordinary course of
business;

 

(b)           the sale, transfer or other disposition of any tangible personal
property that, in the reasonable judgment of the Credit Parties and their
Subsidiaries, has become uneconomic, obsolete or worn out;

 

(c)           sales, transfers and dispositions of assets to a Borrower or any
other Credit Party (other than Holdings);

 

(d)           any Borrower or any Subsidiary of a Borrower may merge into a
Borrower in a transaction in which such Borrower is the surviving corporation,
and (ii) any Subsidiary

 

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(other than a Credit Party) may merge into any other Subsidiary (other than a
Credit Party), in each case with at least twenty (20) Business Days prior
written notice to Agent;

 

(e)           the disposition or sale of Cash Equivalents in consideration for
cash;

 

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

 

(g)           sales which are permitted to occur under Section 6.9 hereof;

 

(h)           the sale, transfer, lease, or other disposition of Property not
otherwise permitted hereunder (excluding any disposition of Property as part of
a sale and leaseback transaction and any Equity Interests of any Subsidiary and
Accounts) of any Credit Party or any Subsidiary aggregating for Credit Parties
and their Subsidiaries, so long as no Event of Default exists or would occur as
a result thereof, with an aggregate net book value of  not more than $500,000
during any fiscal year of the Credit Parties;

 

(i)            the sale, transfer or other disposition of accounts receivable
constituting bad debts in connection with the compromise, settlement or
collection thereof in the ordinary course of business (and not as part of a bulk
sale or receivables financing);

 

(j)            to the extent constituting dispositions, Permitted Liens;

 

(k)           leases, subleases, licenses and sublicenses of real or personal
property entered into by the Credit Parties or their Subsidiaries in the
ordinary course of business at arm’s length and on market terms;

 

(l)            the forgiveness of loans made in accordance with Section 6.14(m);

 

(m)          the abandonment of intellectual property which is no longer
material to the business of the Credit Parties;

 

(n)           Permitted Acquisitions and mergers or consolidations in connection
with a Permitted Acquisition; and

 

(o)           (i) any issuance of Equity Interests issued in connection with the
exercise of stock options, Equity Interests issued as compensation or Equity
Interests issued to the seller of an Acquired Business in connection with a
Permitted Acquisition in accordance with the terms hereof, (ii) any Restricted
Payment permitted by Section 6.15, (iii) any issuance of Equity Interests
permitted by Section 6.8, and (iv) any issuance of Equity Interests permitted by
Section 7.7.

 

Notwithstanding the foregoing, in order to be permitted by this Section 6.13,
all sales, transfers, leases and other dispositions permitted hereby (other than
those permitted by paragraphs (c) and (f) above) shall be made for fair value
and for at least 75% cash consideration.  So long as no Default or Event of
Default has occurred and is continuing or would arise as a result thereof,

 

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upon the written request of Borrower Representative, the Agent shall release its
Lien on any Property sold pursuant to the foregoing provisions.

 

Section 6.14          Advances, Investments, Acquisitions and Loans.  No Credit
Party shall, nor shall it permit any Subsidiary to, directly or indirectly, make
loans or advances to or make, retain or have outstanding any investments
(whether through purchase of all or substantially all of the assets or Equity
Interests or obligations or otherwise) in, any Person or enter into any
partnerships or joint ventures, or purchase or own a futures contract or
otherwise become liable for the purchase or sale of currency or other
commodities at a future date in the nature of a futures contract, except that
this Section shall not prevent:

 

(a)           receivables created in the ordinary course of business and payable
or dischargeable in accordance with customary trade terms;

 

(b)           investments in Cash Equivalents subject to Control Agreements
(subject to the limitations referred to in Section 4 hereof);

 

(c)           investments (including debt obligations) received in connection
with the bankruptcy or reorganization of suppliers and customers and in
settlement of delinquent obligations of, and other disputes with, customers and
suppliers arising in the ordinary course of business;

 

(d)           investments in existence on the date hereof and described in
Schedule 6.14;

 

(e)           Investments by the Credit Parties and their Subsidiaries in the
Equity Interests of their Subsidiaries;

 

(f)            loans or advances made by any Borrower to any Subsidiary that is
a Borrower and made by any Subsidiary that is a Borrower to any Borrower,
provided that any such loans and advances made by a Credit Party shall be
evidenced by a promissory note pledged pursuant to the Security Agreement;

 

(g)           Contingent Obligations permitted by Section 6.11;

 

(h)           loans or advances made by a Credit Party (other than Holdings) to
its employees on an arms-length basis in the ordinary course of business
consistent with past practices for travel and entertainment expenses, relocation
costs and similar purposes up to a maximum of $50,000 to any employee and up to
a maximum of $100,000 in the aggregate at any one time outstanding;

 

(i)            investments in the form of Rate Management Agreements permitted
by Section 6.11;

 

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

 

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(k)           non-cash investments received in connection with the dispositions
of assets permitted by Section 6.13;

 

(l)            investments constituting deposits described in clause (b) of
Section 6.12;

 

(m)          Permitted Acquisitions and investments in connection with a
Permitted Acquisition;

 

(n)           Investments by the Credit Parties in Parts in an aggregate amount
not to exceed in any fiscal year (i) $250,000 plus (ii) the annual aggregate
amount that Parts repatriates to the Credit Parties;

 

(o)           investments permitted pursuant to Section 6.13(o) hereof; and

 

(p)           other investments, loans and advances in addition to those
otherwise permitted by this Section in an amount not to exceed $500,000 in the
aggregate at any one time outstanding.

 

Section 6.15          Restricted Payments.  No Credit Party shall, nor shall it
permit any Subsidiary to, make any Restricted Payment or incur any obligation to
do so, except that:

 

(a)           Any Wholly-Owned Subsidiary of any Borrower may make dividends or
distributions to such Borrower;

 

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

 

(c)           Borrowers may make to Holdings distributions to permit Holdings to
pay reasonable and customary corporate and operating expenses and franchise fees
or similar taxes and fees required to maintain its corporate existence;

 

(d)           The applicable Credit Party may pay to Sponsor, the Sponsor
Entities or independent directors fees, indemnification payments and
reimbursable costs and expenses;

 

(e)           Any Credit Party may make Permitted Tax Distributions; and

 

(f)            Borrowers may make to Holdings the Second Restatement Dividend.

 

(g)           any Credit Party may make Restricted Payments in an aggregate
amount not to exceed $20,000,000 during the period commencing on the Second
Restatement Closing Date and ending on the last day of the term of this
Agreement in order to repurchase any class of Equity Interest of any Credit
Party or any of its Subsidiaries pursuant to a share repurchase program or other
share repurchase authorized by the Board of Directors of any of the Credit
Parties, including the repurchase of Equity Interests from certain members of
senior management of the Credit Party; provided that (i) no Default as a result
of non-payment or Event of Default exists as of the date of such share

 

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repurchase, and (ii) the Credit Party delivers to Agent written notice of such
repurchase, including the number of shares and aggregate purchase price for such
shares, not later than within one week of such share repurchase.

 

Section 6.16          Limitation on Restrictions.  No Credit Party shall, nor
shall it permit any Subsidiary to, directly or indirectly, create or otherwise
cause or suffer to exist or become effective any restriction on the ability of
any such Subsidiary to (a) pay dividends or make any other distributions on its
capital stock or other Equity Interests owned by any Credit Party or any other
Subsidiary, (b) pay or repay any Indebtedness owed to any Credit Party or any
other Subsidiary, (c) make loans or advances to any Credit Party or any other
Subsidiary, (d) transfer any of its Property to any Credit Party or any other
Subsidiary, (e) encumber or pledge any of its assets to or for the benefit of
the Agent or (f) guaranty the Obligations, including, without limitation, Rate
Management Obligations and Banking Services Obligations; provided that (i) the
foregoing shall not apply to restrictions and conditions imposed by law or by
any Loan Document, (ii) the foregoing shall not apply to restrictions and
conditions existing on the date hereof identified on Schedule 6.16 (but shall
apply to any extension or renewal of, or any amendment or modification expanding
the scope of, any such restriction or condition), (iii) the foregoing shall not
apply to customary restrictions and conditions contained in agreements relating
to the sale of a Subsidiary pending such sale, provided such restrictions and
conditions apply only to the Subsidiary that is to be sold and such sale is
permitted hereunder, (iv) clauses (d) and (e) 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 securing such Indebtedness and (v) clauses (d) and
(e) of the foregoing shall not apply to customary provisions in leases licenses
and other contracts customarily restricting the assignment thereof and
restrictions on licenses, sublicenses and assignments of intellectual property.

 

Section 6.17          Limitation on the Creation of Subsidiaries. 
Notwithstanding anything to the contrary contained in this Agreement, no Credit
Party shall, nor shall it permit any Subsidiary to, establish or create after
the Second Restatement Closing Date any Subsidiary; provided that any Borrower
and its Wholly-Owned Subsidiaries shall be permitted to establish or create
Wholly-Owned Subsidiaries so long as the Credit Parties and their Subsidiaries
timely comply with the requirements of Section 4.4 hereof.

 

Section 6.18          Material Contracts; Other Agreements.  Each Credit Party
shall perform and observe in all material respects all the terms and provisions
of each Material Contract to be performed or observed by it, maintain each such
Material Contract in full force and effect (unless such Material Contract
expires by its terms and is terminated in the ordinary course of business),
enforce each such Material Contract in accordance with its terms, take all such
action to such end as may be from time to time reasonably requested by the Agent
and, upon request of the Agent, make to each other party to each such Material
Contract such demands and requests for information and reports or for action as
any Credit Party or any of its Subsidiaries is entitled to make under such
Material Contract, and cause each of its Subsidiaries to do so, except, in any
case, where the failure to do so, either individually or in the aggregate, could
not reasonably be expected to have a Material Adverse Effect. The Credit Parties
shall provide prompt written notice to Agent of any termination, by the
floorplan financing party, of any agreement regarding floor planning financing
arrangements, that includes Floorplan Repurchase Obligations.

 

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Section 6.19          OFAC; Anti-Corruption Laws; Sanctions .  Each Credit Party
shall conduct  its, and cause its Subsidiaries to conduct their, business in
compliance in all material respects with the FCPA, and other similar and
applicable anti-corruption laws in other applicable jurisdictions and institute
and maintain policies and procedures designed to promote and achieve compliance
with such laws.  Each Credit Party will not, and will not permit any Subsidiary
to, use any Loan or the proceeds of any Loan, or lend, contribute or otherwise
make available any Loan or the proceeds of any Loan to any Sanctioned Person, to
fund any activities of or business with any Sanctioned Person or any Sanctioned
Entity, or in any other manner that will result in a violation by any party
hereto of OFAC Sanctions. Each Credit Party will not, and will not permit any
Subsidiary to, use any Loan or the proceeds therefrom for any purpose that would
violate the FCPA or any similar anti-corruption laws in any other applicable
jurisdiction.

 

Section 6.20          Name, Fiscal Year Accounting and Organizational
Documents.  No Credit Party shall, nor shall it permit any Subsidiary to,
without at least twenty (20) Business Days prior written notice to agent
(a) change, from that as of the Second Restatement Closing Date, its name, its
fiscal year, or its method of accounting, except as required by GAAP, or
(b) amend or modify any of the terms or provisions of its certificate
incorporation or by-laws or any other organizational document in a manner that
would be materially adverse to Agent or any Lender.

 

Section 6.21          Deposit Accounts and Cash Management Services.  Each of
the Credit Parties shall, and shall cause each of its Subsidiaries (other than
Parts) to, within sixty (60) days of the Second Restatement Closing Date, to the
extent not previously completed, maintain each of its domestic deposit accounts
and general checking/controlled disbursement accounts solely with a Lender, and
Fifth Third shall be the principal depository and principal bank of account in
which substantially all funds of the Credit Parties and their Subsidiaries are
deposited, except to the extent otherwise agreed in writing by Fifth Third. 
Each of the Credit Parties shall, and shall cause each of its Subsidiaries to,
shall enter into agreements with Fifth Third for all of its needs in connection
with cash management services and shall grant to Fifth Third an opportunity to
provide any business banking services required by any of them, including payroll
and employee benefit plan services. Deposit account control agreements shall be
required for any such deposit accounts which, with the prior written consent of
Fifth Third, are maintained at financial institutions other than Fifth Third;
provided, that notwithstanding anything to the contrary in this Section 6.21,
Parts shall not be required to (A) move to Fifth Third, or maintain at any time
with Fifth Third, any deposit accounts, general checking/ controlled
disbursement accounts or any other accounts of any kind or nature or (B) enter
into any deposit account control agreement with respect to its accounts.

 

Section 6.22          Financial Covenants.

 

(a)           Total Leverage Ratio.  The Credit Parties shall not, as of the
last day of each fiscal quarter of Holdings and its Subsidiaries during the
periods specified below, permit the Total Leverage Ratio to be greater than:

 

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Fiscal Quarter Ending

 

The Total Leverage Ratio
Shall Not Be Greater Than:

6/30/2016

 

3.25 to 1.0

10/2/2016

 

3.25 to 1.0

1/1/2017

 

3.25 to 1.0

4/2/2017

 

2.75 to 1.0

6/30/2017

 

2.75 to 1.0

10/1/2017

 

2.75 to 1.0

12/31/2017

 

2.75 to 1.0

4/1/2018
and each Fiscal Quarter Ending thereafter through the Maturity Date

 

2.50 to 1.0

 

(b)           Fixed Charge Coverage Ratio.  As of the last day of each fiscal
quarter of the Credit Parties and their Subsidiaries ending during the periods
specified below, the Credit Parties shall maintain a ratio of (i) EBITDA for the
four fiscal quarters of the Credit Parties and their Subsidiaries then ended to
(ii) Fixed Charges for the same four fiscal quarters then ended of not less
than:

 

Fiscal Quarter Ending

 

Fixed Charge Coverage Ratio
shall not be less than:

March 29, 2015 and the last day of each fiscal quarter thereafter

 

1.15 to 1.0

 

(c)           Capital Expenditures.  The Credit Parties will not, nor will they
permit any Subsidiary to, incur or make any Capital Expenditures during any
fiscal year in an amount exceeding $7,500,000 plus the unused amount available
for Capital Expenditures under this Section 6.22(c) for the immediately
preceding fiscal year (excluding any carry forward available from any prior
fiscal year); provided, that with respect to any fiscal year, capital
expenditures made during any such fiscal year shall be deemed to be made first
with respect to the applicable limitation for such year and then with respect to
any carry forward amount to the extent applicable.

 

Section 6.23          Holdings; Limitations.  Each of Holdings and Borrowers
hereby agrees that, until such time as all of the Obligations (other than
contingent indemnification obligations for which no claim has been made) have
been paid or performed in full and all Commitments of all Lenders shall have
terminated and no L/C Obligations or other Obligations are outstanding or have
been Cash Collateralized, as set forth in this Agreement:

 

(a)           Holdings agrees that its sole purpose shall be to hold a
Controlling percentage of the Equity Interests in MasterCraft, Sales
Administration, Parts and Hydra and engage in activities ancillary thereto as
permitted by this Agreement.  Without limiting the foregoing, Holdings agrees
that it shall not (i) engage in any business or investment activity other

 

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than owning the Equity Interests in MasterCraft, Sales Administration, Parts and
Hydra and engaging in activities ancillary thereto expressly permitted under
this Agreement; (ii) become obligated for any Indebtedness, whether directly or
indirectly, (iii) permit any Lien to exist on any of its assets except for
Permitted Liens, to the extent applicable; or (iv) consolidate with or merge
with or into any other Person or acquire substantially all of the assets of any
other Person, or sell any of its assets, whether in one or a series of
transactions.

 

(b)           Holdings owns, as of the Second Restatement Closing Date, all of
the issued and outstanding voting Equity Interests of MasterCraft, Sales
Administration, Parts and Hydra.  Holdings agrees that it will not, by act or
omission:  (i) sell, assign (by operation of law or otherwise) or otherwise
dispose of, or grant any option with respect to, any of its Equity Interests in
MasterCraft, Sales Administration, Parts or Hydra; or (ii) create or permit to
exist any Lien (other than Permitted Liens) upon or with respect to any of such
Equity Interests, except for applicable transfer restrictions set forth in its
governing documents or applicable law.

 

Section 6.24          Foreign Subsidiary Limitations.  Each of Parts and
Borrowers hereby agrees that, until such time as all of the Obligations (other
than contingent indemnification obligations for which no claim has been made)
have been paid or performed in full and all Commitments of all Lenders shall
have terminated and no L/C Obligations or other Obligations are outstanding or
have been Cash Collateralized, neither Parts nor any Foreign Subsidiary created
after the date hereof, shall, without the prior written consent of Agent,
(i) receive any proceeds from any Loan hereunder or any Collateral except to the
extent provided in Section 6.14(n) hereof.

 

SECTION 7

 

EVENTS OF DEFAULT AND REMEDIES.

 

Section 7.1            Events of Default.  Any one or more of the following
shall constitute an “Event of Default” hereunder:

 

(a)           default in the payment (i) when due (whether at the stated
maturity thereof or at any other time provided for in this Agreement) of all or
any part of the principal of or interest on any Loan or (ii) within three
(3) Business Days after the same shall be due, any other Obligation payable
hereunder or under any other Loan Document;

 

(b)           default in the observance or performance of any covenant set forth
in (i) Sections 6.3(c), 6.4, 6.11, 6.12, 6.13, 6.14, 6.15, 6.19, 6.20 and 6.22
hereof or of any provision in any Loan Document dealing with the use,
disposition or remittance of the Proceeds of Collateral or requiring the
maintenance of insurance thereon, or (ii) Section 6.1 which is not remedied
within three (3) Business Days after the earlier of (x) the date on which such
default shall first become known to any officer of any Credit Party or (y) the
date on which written notice of such default is given to Borrowers by the Agent
except in the case of Section 6.1(d)(ii), in which case (x) and (y) will not
apply;

 

(c)           default in the observance or performance of any other provision
hereof or of any other Loan Document which is not remedied within thirty (30)
days after the earlier of

 

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(i) the date on which such default shall first become known to any officer of
any Credit Party or (ii) the date on which written notice of such default is
given to Borrower Representative by the Agent;

 

(d)           any representation or warranty by any Credit Party made herein or
in any other Loan Document or in any certificate delivered by any Credit Party
to the Agent or the Lenders pursuant hereto or thereto or in connection with any
transaction contemplated hereby or thereby proves untrue in any material respect
as of the date of the issuance or making or deemed making thereof, except to the
extent the same expressly relate to an earlier date in which case such
representations and warranties shall be true and correct in all material
respects as of such earlier date;

 

(e)           any event occurs or condition exists (other than those described
in subsections (a) through (d) above) which is specified as an event of default
under any of the other Loan Documents, or any of the Loan Documents shall for
any reason not be or shall cease to be in full force and effect or is declared
to be null and void in any material respect, or any of the Collateral Documents
shall for any reason fail to create a valid and perfected first priority Lien
(subject to Permitted Liens) in favor of the Agent, for the benefit of itself
and the Lenders, in any Collateral purported to be covered thereby except as
expressly permitted by the terms thereof and except with respect to assets with
an aggregate fair market value not exceeding $1,000,000, or any Credit Party or
any Subsidiary takes any action for the purpose of terminating, repudiating or
rescinding any Loan Document executed by it or any of its obligations thereunder
(except in connection with activities expressly permitted under this Agreement);

 

(f)            any default shall occur under any (i) Indebtedness of any Credit
Party or any Subsidiary aggregating in excess of $1,000,000, or under any
indenture, agreement or other instrument under which the same may be issued, and
such default shall continue for a period of time sufficient to permit
acceleration of the maturity of any such Indebtedness (whether or not such
Indebtedness is in fact accelerated) or any such Indebtedness shall not be paid
when due (whether by demand, lapse of time, acceleration or otherwise) after
giving effect to the applicable grace or cure periods, if any, or (ii) Floorplan
Repurchase Obligations aggregating in excess of $1,000,000, or (iii) any Rate
Management Agreement of any Credit Party or any Subsidiary with any Lender or an
affiliate of any Lender;

 

(g)           any judgment or judgments, order or orders, writ or writs or
warrant or warrants of attachment, or any similar process or processes, shall be
entered or filed against any Credit Party or any Subsidiary, or against any of
its Property, (i) for the payment of money in an aggregate amount in excess of
$1,500,000, except to the extent (x) fully and unconditionally covered by
insurance pursuant to which the insurer has accepted liability therefor in
writing or (y) fully and unconditionally covered by an appeal bond, for which
such Credit Party or such Subsidiary has established in accordance with GAAP a
cash or Cash Equivalent reserve an amount equal to such judgment, writ or
warrant, or (ii) for any non-monetary award, which individually or in the
aggregate could reasonably be expected to have a Material Adverse Effect, and in
either case which remains undischarged, unvacated, unbonded or unstayed for a
period of thirty (30) days or enforcement proceedings are commenced by any
creditor upon such judgment or order;

 

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(h)           (i) An ERISA Event that results or is expected to result in
liability of any Credit Party under Title IV of ERISA to the Pension Plan,
Multiemployer Plan or the PBGC in an aggregate amount in excess of $250,000, or
(ii) any Credit Party or any ERISA Affiliate fails to pay when due, after the
expiration of any applicable grace period, any installment payment with respect
to its withdrawal liability under Section 4201 of ERISA under a Multiemployer
Plan and such failure results or is expected to result in liability of any
Credit Party in an aggregate amount in excess of $250,000;

 

(i)            any Change of Control shall occur;

 

(j)            any Credit Party or any Subsidiary shall (i) have entered
involuntarily against it an order for relief under the Bankruptcy Code, as
amended, (ii) not pay, or admit in writing its inability to pay, its debts
generally as they become due, (iii) make an assignment for the benefit of
creditors, (iv) apply for, seek, consent to or acquiesce in, the appointment of
a receiver, custodian, trustee, examiner, liquidator or similar official for it
or any substantial part of its Property, (v) institute any proceeding seeking to
have entered against it an order for relief under the Bankruptcy Code, as
amended, to adjudicate it insolvent, or seeking dissolution, winding up,
liquidation, reorganization, arrangement, adjustment or composition of it or its
debts under any law relating to bankruptcy, insolvency or reorganization or
relief of debtors or fail to file an answer or other pleading denying the
material allegations of any such proceeding filed against it, (vi) take any
action in furtherance of any matter described in parts (i) through (v) above, or
(vii) fail to contest in good faith any appointment or proceeding described in
Section 7.1(k) hereof;

 

(k)           a custodian, receiver, trustee, examiner, liquidator or similar
official shall be appointed for any Credit Party or any Subsidiary, or any
substantial part of any of its Property, or a proceeding described in
Section 7.1(j)(v) shall be instituted against any Credit Party or any
Subsidiary, and such appointment continues undischarged or such proceeding
continues undismissed or unstayed for a period of sixty (60) days;

 

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

 

(m)          any default or event of default shall occur under any other of the
Subordinated Debt Documents beyond the applicable notice and cure period
provided for therein, any subordination or intercreditor provision in any
Subordination Agreement or in any document or instrument governing Subordinated
Debt, shall cease to be in full force and effect, or any Credit Party or any
other Person (including the holder of any applicable Subordinated Debt) shall
contest in any manner the validity, binding nature or enforceability of any such
provision; or

 

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(n)           the failure of the Credit Parties to observe and comply in all
respects with Sections 6.23 (Holdings; Limitations) and 6.24 (Certain Subsidiary
Limitations) hereof.

 

Section 7.2            Non-Bankruptcy Defaults.  When any Event of Default other
than those described in subsection (j) or (k) of Section 7.1 hereof has occurred
and is continuing, the Agent shall, by written notice to Borrower
Representative: (a) if so directed by the Required Lenders, terminate or suspend
the remaining Commitments and all other obligations of the Lenders hereunder on
the date stated in such notice (which may be the date thereof); (b) if so
directed by the Required Lenders, declare the principal of and the accrued
interest on all outstanding Loans to be forthwith due and payable and thereupon
all outstanding Loans, including both principal and interest thereon, shall be
and become immediately due and payable together with all other amounts payable
under the Loan Documents without further demand, presentment, protest or notice
of any kind; and (c) if so directed by the Required Lenders, and otherwise may,
demand that Borrowers immediately pay to the Agent an amount equal to 102% of
the then full available amount for drawing under each or any Letter of Credit,
including, without limitation, any and all L/C Obligations and each Borrower
agrees to immediately make such payment and acknowledges and agrees that the
Lenders would not have an adequate remedy at law for failure by any Borrower to
honor any such demand and that the Agent, for the benefit of itself and the
Lenders, shall have the right to require each Borrower to specifically perform
such undertaking whether or not any drawings or other demands for payment have
been made under any Letter of Credit.  The Agent, after giving notice to
Borrower Representative pursuant to Section 7.1(c) or this Section 7.2, shall
also promptly send a copy of such notice to the other Lenders, but the failure
to do so shall not impair or annul the effect of such notice.

 

Section 7.3            Bankruptcy Defaults.  When any Event of Default described
in subsections (j) or (k) of Section 7.1 hereof has occurred and is continuing,
then all outstanding Loans shall immediately become due and payable together
with all other amounts payable under the Loan Documents without presentment,
demand, protest or notice of any kind, the Commitments and any and all other
obligations of the Lenders to extend further credit pursuant to any of the terms
hereof shall immediately terminate and Borrowers shall immediately pay to the
Agent the full amount then available for drawing under all outstanding Letters
of Credit, including, without limitation, any and all L/C Obligations, each
Borrower acknowledging and agreeing that the Lenders would not have an adequate
remedy at law for failure by any Borrower to honor any such demand and that the
Lenders, and the Agent on their behalf, shall have the right to require each
Borrower to specifically perform such undertaking whether or not any draws or
other demands for payment have been made under any of the Letters of Credit.

 

Section 7.4            Collateral for Undrawn Letters of Credit.

 

(a)           If the prepayment of the amount available for drawing under any or
all outstanding Letters of Credit, including, without limitation, any and all
L/C Obligations, is required under Section 2.8(b) or under Section 7.2 or 7.3
above, Borrowers shall forthwith pay the amount required to be so prepaid, to be
held by the Agent as provided in subsection (b) below.

 

(b)           All amounts prepaid pursuant to subsection (a) above shall be held
by the Agent in one or more separate collateral accounts (each such account, and
the credit balances,

 

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properties, and any investments from time to time held therein, and any
substitutions for such account, any certificate of deposit or other instrument
evidencing any of the foregoing and all proceeds of and earnings on any of the
foregoing being collectively called the “Collateral Account”) as security for,
and for application by the Agent (to the extent available) to, the reimbursement
of any payment under any Letter of Credit then or thereafter made by the L/C
Issuer, and to the payment of the unpaid balance of any other Obligations.  The
Collateral Account shall be held in the name of and subject to the exclusive
dominion and control of the Agent for the benefit of the Agent, the Lenders, and
the L/C Issuer.  If and when requested by Borrower Representative, the Agent
shall invest funds held in the Collateral Account from time to time in direct
obligations of, or obligations the principal of and interest on which are
unconditionally guaranteed by, the United States of America with a remaining
maturity of one year or less, provided that the Agent is irrevocably authorized
to sell investments held in the Collateral Account when and as required to make
payments out of the Collateral Account for application to amounts due and owing
from any Borrower to the L/C Issuer, the Agent or the Lenders; provided,
however, that if (i) any Borrower shall have made payment of all such
obligations referred to in subsection (a) above, (ii) all relevant preference or
other disgorgement periods relating to the receipt of such payments have passed,
and (iii) no Letters of Credit, Commitments, Loans or other Obligations remain
outstanding hereunder, then the Agent shall release to Borrower Representative
any remaining amounts held in the Collateral Account.

 

Section 7.5            Notice of Default.  The Agent shall give notice to
Borrower Representative under Section 7.1(c) hereof promptly upon being
requested to do so by any Lender and shall at such time also notify all the
Lenders thereof.

 

Section 7.6            Expenses.  Each of the Credit Parties agrees to pay to
the Agent and each Lender, and any other holder of any Note outstanding
hereunder, all reasonable costs and expenses incurred or paid by the Agent and
such Lender or any such holder, including reasonable and documented attorneys’
fees and court costs, in connection with any Default or Event of Default or the
enforcement (or forbearance) of any of the Loan Documents (including all such
costs and expenses incurred in connection with any proceeding under the
Bankruptcy Code involving any Credit Party or any Subsidiary as a debtor
thereunder).

 

Section 7.7            Right to Cure Certain Financial Covenant Defaults.

 

(a)           Notwithstanding anything to the contrary in this Agreement or the
other Loan Documents but subject to clause (d) of this Section 7.7, if:  (i) the
Credit Parties fail to comply with a financial covenant set forth in
Sections 6.22(a) and/or 6.22(b) for any applicable test period (each a “Curable
Test Period”) and (ii) there is no other Event of Default then in existence, the
Credit Parties may cure any such non-compliance (collectively, the “Cure Right”)
by (A) giving an irrevocable notice to the Agent that the Credit Parties will
exercise the Cure Right (a “Cure Notice”), such Cure Notice to be given on or
before the date which is five (5) Business Days after the earlier of (x) the
delivery of the financial statements by the Credit Parties to the Agent for the
applicable test period or (y) the date on which financial statements with
respect to such applicable test period are required to be delivered pursuant to
Section 6.1(b), and (B) receiving cash contributions to the equity capital of
Credit Parties (in accordance with this Section 7.7) in an amount sufficient
(the “Cure Amount”) to cause pro forma compliance with

 

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the Curable Financial Covenants for such Curable Test Period (assuming such
contributions constitute a dollar-for-dollar increase to EBITDA of the Credit
Parties).

 

(b)           Upon the Agent’s receipt of the Cure Amount in accordance with
Section 2.8(b)(i)(y), (i) EBITDA for the period corresponding to such Curable
Test Period (and the subsequent three (3) fiscal quarters) shall be deemed to
include, for all purposes of the Loan Documents, the Cure Amount as if such Cure
Amount were received on the last day of such Curable Test Period and (ii) the
Curable Financial Covenants for such Curable Test Period shall be recalculated,
on a pro forma basis, after giving effect to the inclusion of such Cure Amount
in EBITDA, pursuant to the immediately preceding clause (i).  If, after
recalculating the Curable Financial Covenants in accordance with the immediately
preceding sentence, the Credit Parties shall then be in compliance with the
requirements of Sections 6.21(a) or 6.21(b), as applicable, for such Curable
Test Period, the Credit Parties shall be deemed to have satisfied the Curable
Financial Covenants as of the relevant date of determination with the same
effect as though there had been no failure to comply therewith at such date, and
the applicable Event of Default(s) arising from such violation of the Curable
Financial Covenants that had occurred shall be deemed cured for all purposes of
this Agreement and the other Loan Documents.

 

(c)           The Cure Amount for any Curable Test Period shall be received by
Borrowers, and deposited with the Agent for application against the outstanding
Obligations in accordance with Section 2.8(b), on or before the applicable Cure
Date.

 

(d)           Notwithstanding anything to the contrary in this Section 7.7,
(i) the Credit Parties will not have the right to exercise the Cure Right
(A) more than once in any two (2) consecutive Curable Test Periods and (B) more
than a total of three (3) times during the term of this Agreement; (ii) the Cure
Amount shall be no greater than, and the calculation of the Curable Financial
Covenants shall be deemed to include only, the amount necessary to be in
compliance with the Curable Financial Covenants; (iii) all Cure Amounts shall be
disregarded for all other purposes under this Agreement and the other Loan
Documents (including, without limitation, calculating EBITDA for purposes of
determining any basket levels, the Applicable Margin and other items governed by
reference to, or calculated using EBITDA); (iv) no Cure Amount may be
contributed after the applicable Cure Date; and (v) the Cure Amount shall not
exceed (A) the greater of (x) the amount necessary to be in compliance with the
Curable Financial Covenants, or (y) $3,500,000, or (B) together with all prior
Cure Amounts, an aggregate principal amount of $10,500,000.

 

SECTION 8

 

CHANGE IN CIRCUMSTANCES AND CONTINGENCIES.

 

Section 8.1            Funding Indemnity.  If any Lender shall incur any loss,
cost or expense (including, without limitation, any loss of profit, and any
loss, cost or expense incurred by reason of the liquidation or re-employment of
deposits or other funds acquired by such Lender to fund or maintain any
Eurodollar Loan or the relending or reinvesting of such deposits or amounts paid
or prepaid to such Lender or by reason of breakage of interest rate swap
agreements or the liquidation of other hedging contracts or agreements) as a
result of:

 

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(a)           any payment, prepayment or conversion of a Eurodollar Loan on a
date other than the last day of its Interest Period,

 

(b)           any failure (because of a failure to meet the conditions of
Section 3 or otherwise) by any Borrower to borrow or continue a Eurodollar Loan,
or to convert a Base Rate Loan into a Eurodollar Loan, on the date specified in
a notice given pursuant to Section 2.5(a) hereof,

 

(c)           any failure by any Borrower to make any payment of principal on
any Eurodollar Loan when due (whether by acceleration or otherwise),

 

(d)           any acceleration of the maturity of a Eurodollar Loan as a result
of the occurrence of any Event of Default hereunder, or

 

(e)           any assignment required by Section 8.6(b),

 

then, upon the demand of such Lender, Borrowers shall pay to such Lender such
amount as will reimburse such Lender for such loss, cost or expense.  If any
Lender makes such a claim for compensation, it shall provide to Borrower
Representative, with a copy to the Agent, a certificate setting forth the amount
of such loss, cost or expense in reasonable detail (including an explanation of
the basis for and the computation of such loss, cost or expense) and the amounts
shown on such certificate shall be conclusive absent manifest error. 
Notwithstanding any other provision of this Agreement, each Lender shall be
entitled to fund and maintain its funding of all or any part of its Loans in any
manner it sees fit, it being understood, however, that for the purposes of this
Agreement all determinations hereunder with respect to Eurodollar Loans shall be
made as if each Lender had actually funded and maintained each Eurodollar Loan
through the purchase of deposits in the interbank eurodollar market having a
maturity corresponding to such Loan’s Interest Period, and bearing an interest
rate equal to LIBOR for such Interest Period.

 

Section 8.2            Illegality.  Notwithstanding any other provisions of this
Agreement or any other Loan Document, if at any time any Change in Law, makes it
unlawful for any Lender to make or continue to maintain any Eurodollar Loans or
to perform its obligations as contemplated hereby, such Lender shall promptly
give notice thereof to Borrower Representative and the Agent and such Lender’s
obligations to make or maintain Eurodollar Loans under this Agreement shall be
suspended until it is no longer unlawful for such Lender to make or maintain
Eurodollar Loans.  Borrowers shall prepay on demand the outstanding principal
amount of any such affected Eurodollar Loans, together with all interest accrued
thereon and all other amounts then due and payable to such Lender under this
Agreement; provided, however, subject to all of the terms and conditions of this
Agreement, Borrower Representative may then elect to borrow the principal amount
of the affected Eurodollar Loans from such Lender by means of Base Rate Loans
from such Lender, which Base Rate Loans shall not be made ratably by the Lenders
but only from such affected Lender.

 

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Section 8.3            Unavailability of Deposits or Inability to Ascertain, or
Inadequacy of, LIBOR.  If on or prior to the first day of any Interest Period
for any Borrowing of Eurodollar Loans:

 

(a)           the Agent determines that deposits in Dollars (in the applicable
amounts) are not being offered to it in the interbank eurodollar market for such
Interest Period, or that by reason of circumstances affecting the interbank
eurodollar market adequate and reasonable means do not exist for ascertaining
the applicable LIBOR, or

 

(b)           the Required Lenders advise the Agent that (i) LIBOR as determined
by the Agent will not adequately and fairly reflect the cost to such Lenders of
funding their Eurodollar

 

Loans for such Interest Period or (ii) that the making or funding of Eurodollar
Loans has become impracticable,

 

then the Agent shall forthwith give notice thereof to Borrower Representative
and the Lenders, whereupon until the Agent notifies Borrower Representative that
the circumstances giving rise to such suspension no longer exist, the
obligations of the Lenders to make Eurodollar Loans shall be suspended.

 

Section 8.4            Increased Costs.

 

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

 

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

 

(ii)           subject any Recipient to any Taxes (other than (A) Indemnified
Taxes, (B) Taxes described in clauses (b) through (d) of the definition of
Excluded Taxes and (C) Connection Income Taxes) on its loans, loan principal,
letters of credit, commitments, or other obligations, or its deposits, reserves,
other liabilities or capital attributable thereto; or

 

(iii)          impose on any Lender or any L/C Issuer or the London interbank
market any other condition, cost or expense (other than Taxes) affecting this
Agreement or Loans made by such Lender or any Letter of Credit or participation
therein;

 

and the result of any of the foregoing shall be to increase the cost to such
Lender or such other Recipient of making, converting to, continuing or
maintaining any Loan or of maintaining its obligation to make any such Loan, or
to increase the cost to such Lender, such L/C Issuer or such other Recipient of
participating in, issuing or maintaining any Letter of Credit (or of maintaining
its obligation to participate in or to issue any Letter of Credit), or to reduce
the amount of any sum received or receivable by such Lender, L/C Issuer or other
Recipient hereunder (whether of principal, interest or any other amount) then,
upon request of such Lender, L/C Issuer or other Recipient, Borrowers will pay
to such Lender, L/C Issuer or other Recipient, as the case may be, such
additional amount or amounts as will compensate such Lender, L/C Issuer or other
Recipient, as the case may be, for such additional costs incurred or reduction
suffered.

 

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(b)           Capital Requirements.  If any Lender or L/C Issuer determines that
any Change in Law affecting such Lender or L/C Issuer or any lending office of
such Lender or such Lender’s or L/C Issuer’s holding company, if any, regarding
capital or liquidity requirements, has or would have the effect of reducing the
rate of return on such Lender’s or L/C Issuer’s capital or on the capital of
such Lender’s or L/C Issuer’s holding company, if any, as a consequence of this
Agreement, the Commitments of such Lender or the Loans made by, or
participations in Letters of Credit or Swing Loans held by, such Lender, or the
Letters of Credit issued by any L/C Issuer, to a level below that which such
Lender or L/C Issuer or such Lender’s or L/C Issuer’s holding company could have
achieved but for such Change in Law (taking into consideration such Lender’s or
L/C Issuer’s policies and the policies of such Lender’s or L/C Issuer’s holding
company with respect to capital adequacy), then from time to time Borrowers will
pay to such Lender or L/C Issuer, as the case may be, such additional amount or
amounts as will compensate such Lender or L/C Issuer or such Lender’s or L/C
Issuer’s holding company for any such reduction suffered.

 

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

 

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

 

Section 8.5            Taxes.

 

(a)           Defined Terms.  For purposes of this Section 8.5, the term
“Lender” includes any L/C Issuer and the term “applicable law” includes FATCA.

 

(b)           Payments Free of Taxes.  Any and all payments by or on account of
any obligation of any Credit Party under any Loan Document shall be made without
deduction or withholding for any Taxes, except as required by applicable law. 
If any applicable law (as determined in the good faith discretion of an
applicable Withholding Agent) requires the deduction or withholding of any Tax
from any such payment by a Withholding Agent, then the applicable Withholding
Agent shall be entitled to make such deduction or withholding and shall timely
pay the full amount deducted or withheld to the relevant Governmental Authority
in accordance with applicable law and, if such Tax is an Indemnified Tax, then
the sum payable by the applicable Credit Party shall be increased as necessary
so that after such deduction or

 

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withholding has been made (including such deductions and withholdings applicable
to additional sums payable under this Section) the applicable Recipient receives
an amount equal to the sum it would have received had no such deduction or
withholding been made.

 

(c)           Payment of Other Taxes by the Credit Parties.  The Credit Parties
shall timely pay to the relevant Governmental Authority in accordance with
applicable law, or at the option of the Agent timely reimburse it for the
payment of, any Other Taxes.

 

(d)           Indemnification by the Credit Parties.  The Credit Parties shall
jointly and severally indemnify each Recipient, within 10 days after demand
therefor, for the full amount of any Indemnified Taxes (including Indemnified
Taxes imposed or asserted on or attributable to amounts payable under this
Section) payable or paid by such Recipient or required to be withheld or
deducted from a payment to such Recipient and any reasonable expenses arising
therefrom or with respect thereto, whether or not such Indemnified Taxes were
correctly or legally imposed or asserted by the relevant Governmental
Authority.  A certificate setting forth in reasonable detail the nature and
amount of such payment or liability delivered to Borrower Representative by a
Lender (with a copy to the Agent), or by the Agent on its own behalf or on
behalf of a Lender, shall be conclusive absent manifest error.

 

(e)           Indemnification by the Lenders.  Each Lender shall severally
indemnify the Agent, within 10 days after demand therefor, for (i) any
Indemnified Taxes attributable to such Lender (but only to the extent that any
Credit Party has not already indemnified the Agent for such Indemnified Taxes
and without limiting the obligation of the Credit Parties to do so), (ii) any
Taxes attributable to such Lender’s failure to comply with the provisions of
Section 10.8 relating to the maintenance of a Participant Register and (iii) any
Excluded Taxes attributable to such Lender, in each case, that are payable or
paid by the Agent in connection with any Loan Document, and any reasonable
expenses arising therefrom or with respect thereto, whether or not such Taxes
were correctly or legally imposed or asserted by the relevant Governmental
Authority.  A certificate setting forth in reasonable detail the nature and
amount of such payment or liability delivered to any Lender by the Agent shall
be conclusive absent manifest error.  Each Lender hereby authorizes the Agent to
set off and apply any and all amounts at any time owing to such Lender under any
Loan Document or otherwise payable by the Agent to the Lender from any other
source against any amount due to the Agent under this paragraph (e).

 

(f)            Evidence of Payments.  As soon as practicable after any payment
of Taxes by any Credit Party to a Governmental Authority pursuant to this
Section 8.5, such Credit Party shall deliver to the 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 Agent.

 

(g)           Status of Lenders.  (i) Any Lender that is entitled to an
exemption from or reduction of withholding Tax with respect to payments made
under any Loan Document shall deliver to Borrower Representative and the Agent,
at the time or times reasonably requested by Borrower Representative or the
Agent, such properly completed and executed documentation reasonably requested
by Borrower Representative or the Agent as will permit such payments to be made
without withholding or at a reduced rate of withholding.  In addition, any
Lender, if reasonably requested by Borrower Representative or the Agent, shall
deliver to Borrower

 

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Representative such other documentation prescribed by applicable law or
reasonably requested by Borrower Representative or the Agent as will enable
Borrower Representative or the Agent to determine whether or not such Lender is
subject to backup withholding or information reporting requirements. 
Notwithstanding anything to the contrary in the preceding two sentences, the
completion, execution and submission of such documentation (other than such
documentation set forth in Section 8.5(g)(ii)(A), (ii)(B) and (ii)(D) below)
shall not be required if in the Lender’s reasonable judgment such completion,
execution or submission would subject such Lender to any material unreimbursed
cost or expense or would materially prejudice the legal or commercial position
of such Lender.

 

(ii)           Without limiting the generality of the foregoing, in the event
that any Borrower is a U.S. Borrower,

 

(A)          any Lender that is a U.S. Person shall deliver to such Borrower and
the Agent on or prior to the date on which such Lender becomes a Lender under
this Agreement (and from time to time thereafter upon the reasonable request of
Borrower Representative or the Agent), executed originals of IRS Form W-9
certifying that such Lender is exempt from U.S. federal backup withholding tax;

 

(B)          any Foreign Lender shall, to the extent it is legally entitled to
do so, deliver to such Borrower and the 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 reasonable request of Borrower Representative or the Agent), whichever
of the following is applicable:

 

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

 

(ii)           executed originals of IRS Form W-8ECI;

 

(iii)          in the case of a Foreign Lender claiming the benefits of the
exemption for portfolio interest under Section 881(c) of the Code, (x) a
certificate substantially in the form of Exhibit H-1 to the effect that such
Foreign Lender is not a “bank” within the meaning of Section 881(c)(3)(A) of the
Code, a “10 percent shareholder” of such Borrower within the meaning of
Section 881(c)(3)(B) of the Code, or a “controlled foreign corporation”
described in Section 881(c)(3)(C) of the

 

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Code (a “U.S. Tax Compliance Certificate”) and (y) executed originals of IRS
Form W-8BEN or W-8BEN-E; or

 

(iv)          to the extent a Foreign Lender is not the beneficial owner,
executed originals of IRS Form W-8IMY, accompanied by IRS Form W-8ECI, IRS
Form W-8BEN or W-8BEN-E, a U.S. Tax Compliance Certificate substantially in the
form of Exhibit H-2 or Exhibit H-3, IRS Form W-9, and/or other certification
documents from each beneficial owner, as applicable; provided that if the
Foreign Lender is a partnership and one or more direct or indirect partners of
such Foreign Lender are claiming the portfolio interest exemption, such Foreign
Lender may provide a U.S. Tax Compliance Certificate substantially in the form
of Exhibit H-4 on behalf of each such direct and indirect partner;

 

(C)          any Foreign Lender shall, to the extent it is legally entitled to
do so, deliver to such Borrower and the 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 reasonable request of Borrower Representative or the Agent), executed
originals of 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 such Borrower or the Agent to determine the withholding
or deduction required to be made; and

 

(D)          if a payment made to a Lender under any Loan Document would be
subject to U.S. federal withholding Tax imposed by FATCA if such Lender were to
fail to comply with the applicable reporting requirements of FATCA (including
those contained in Section 1471(b) or 1472(b) of the Code, as applicable), such
Lender shall deliver to such Borrower and the Agent at the time or times
prescribed by law and at such time or times reasonably requested by Borrower
Representative or the 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 such Borrower or the Agent as
may be necessary for Borrower Representative and the Agent to comply with their
obligations under FATCA and 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.  Solely for purposes of this clause (D), “FATCA”
shall include any amendments made to FATCA after the date of this Agreement.

 

Each Lender agrees that if any form or certification it previously delivered
expires or becomes obsolete or inaccurate in any respect, it shall update such
form or certification or promptly notify such Borrower, Borrower Representative
and the Agent in writing of its legal inability to do so.

 

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(h)           Treatment of Certain Refunds.  If any party determines, in its
sole discretion exercised in good faith, that it has received a refund of any
Taxes as to which it has been indemnified pursuant to this Section 8.5
(including by the payment of additional amounts pursuant to this Section 8.5),
it shall pay to the indemnifying party an amount equal to such refund (but only
to the extent of indemnity payments made under this Section with respect to the
Taxes giving rise to such refund), net of all out-of-pocket expenses (including
Taxes) of such indemnified party and without interest (other than any interest
paid by the relevant Governmental Authority with respect to such refund).  Such
indemnifying party, upon the request of such indemnified party, shall repay to
such indemnified party the amount paid over pursuant to this paragraph (h) (plus
any penalties, interest or other charges imposed by the relevant Governmental
Authority) in the event that such indemnified party is required to repay such
refund to such Governmental Authority.  Notwithstanding anything to the contrary
in this paragraph (h), in no event will the indemnified party be required to pay
any amount to an indemnifying party pursuant to this paragraph (h) the payment
of which would place the indemnified party in a less favorable net after-Tax
position than the indemnified party would have been in if the Tax subject to
indemnification and giving rise to such refund had not been deducted, withheld
or otherwise imposed and the indemnification payments or additional amounts with
respect to such Tax had never been paid.  This paragraph shall not be construed
to require any indemnified party to make available its Tax returns (or any other
information relating to its Taxes that it deems confidential) to the
indemnifying party or any other Person.

 

(i)            Survival.  Each party’s obligations under this Section 8.5 shall
survive the resignation or replacement of the Agent or any assignment of rights
by, or the replacement of, a Lender, the termination of the Commitments and the
repayment, satisfaction or discharge of all obligations under any Loan Document.

 

(j)            For purposes of determining withholding Taxes imposed under
FATCA, from and after the Second Restatement Closing Date, Borrowers and the
Agent shall treat (and the Lenders hereby authorize the Agent to treat) the
Agreement as not qualifying as a “grandfathered obligation” within the meaning
of Treasury Regulation Section 1.1471-2(b)(2)(i).

 

Section 8.6            Mitigation Obligations; Replacement of Lenders.

 

(a)           Designation of a Different Lending Office.  If any Lender requests
compensation under Section 8.4, or requires any Borrower to pay any Indemnified
Taxes or additional amounts to any Lender or any Governmental Authority for the
account of any Lender pursuant to Section 8.5, then such Lender shall (at the
request of Borrower Representative) 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 8.4 or 8.5, as
the case may be, in the future, and (ii) would not subject such Lender to any
unreimbursed cost or expense and would not otherwise be disadvantageous to such
Lender.  Borrowers hereby agree to pay all reasonable costs and expenses
incurred by any Lender in connection with any such designation or assignment.

 

(b)           Replacement of Lenders.  If any Lender requests compensation under
Section 8.4, or if any Borrower is required to pay any Indemnified Taxes or
additional amounts

 

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to any Lender or any Governmental Authority for the account of any Lender
pursuant to Section 8.5 and, in each case, such Lender has declined or is unable
to designate a different lending office in accordance with Section 8.6(a), or if
any Lender is a Defaulting Lender or a Non-Consenting Lender, then Borrower
Representative may, at its sole expense and effort, upon notice to such Lender
and the Agent, require such Lender to assign and delegate, without recourse (in
accordance with and subject to the restrictions contained in, and consents
required by, Section 10.8), all of its interests, rights (other than its
existing rights to payments pursuant to Section 8.4 or Section 8.5) and
obligations under this Agreement and the related Loan Documents to an Eligible
Assignee that shall assume such obligations (which assignee may be another
Lender, if a Lender accepts such assignment); provided that:

 

(i)            Borrowers shall have paid to the Agent the assignment fee (if
any) specified in Section 10.8;

 

(ii)           such Lender shall have received payment of an amount equal to the
outstanding principal of its Loans and participations in Reimbursement
Obligations, accrued interest thereon, accrued fees and all other amounts
payable to it hereunder and under the other Loan Documents (including any
amounts under Section 8.1) from the assignee (to the extent of such outstanding
principal and accrued interest and fees) or Borrowers (in the case of all other
amounts);

 

(iii)          in the case of any such assignment resulting from a claim for
compensation under Section 8.4 or payments required to be made pursuant to
Section 8.5, such assignment will result in a reduction in such compensation or
payments thereafter;

 

(iv)          such assignment does not conflict with applicable law; and

 

(v)           in the case of any assignment resulting from a Lender becoming a
Non-Consenting Lender, the applicable assignee shall have consented to the
applicable amendment, waiver or consent.

 

A Lender shall not be required to make any such assignment or delegation if,
prior thereto, as a result of a waiver by such Lender or otherwise, the
circumstances entitling Borrower Representative to require such assignment and
delegation cease to apply.

 

Section 8.7            Defaulting Lenders.

 

(a)           Defaulting Lender Adjustments.  Notwithstanding anything to the
contrary contained in this Agreement, if any Lender becomes a Defaulting Lender,
then, until such time as such Lender is no longer a Defaulting Lender, to the
extent permitted by applicable law:

 

(i)            Waivers and Amendments.  Such Defaulting Lender’s right to
approve or disapprove any amendment, waiver or consent with respect to this
Agreement shall be restricted as set forth in the definition of Required
Lenders.

 

(ii)           Defaulting Lender Waterfall.  Any payment of principal, interest,
fees or other amounts received by the Agent for the account of such Defaulting
Lender (whether voluntary or mandatory, at maturity, pursuant to Section 7 or
otherwise) or

 

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received by the Agent from a Defaulting Lender pursuant to Section 10.12 shall
be applied at such time or times as may be determined by the Agent as follows: 
first, to the payment of any amounts owing by such Defaulting Lender to the
Agent hereunder; second, to the payment on a pro rata basis of any amounts owing
by such Defaulting Lender to any L/C Issuer or Swing Line Lender hereunder;
third, to Cash Collateralize the L/C Issuers’ Fronting Exposure with respect to
such Defaulting Lender in accordance with Section 8.8; fourth, as Borrower
Representative may request (so long as no Default or Event of Default exists),
to the funding of any Loan in respect of which such Defaulting Lender has failed
to fund its portion thereof as required by this Agreement, as determined by the
Agent; fifth, if so determined by the Agent and Borrowers, to be held in a
deposit account and released pro rata in order to (x) satisfy such Defaulting
Lender’s potential future funding obligations with respect to Loans under this
Agreement and (y) Cash Collateralize the L/C Issuers’ future Fronting Exposure
with respect to such Defaulting Lender with respect to future Letters of Credit
issued under this Agreement, in accordance with Section 8.8; sixth, to the
payment of any amounts owing to the Lenders, the L/C Issuers or Swing Line
Lenders as a result of any judgment of a court of competent jurisdiction
obtained by any Lender, the L/C Issuers or Swing Line Lenders against such
Defaulting Lender as a result of such Defaulting Lender’s breach of its
obligations under this Agreement; seventh, so long as no Default or Event of
Default exists, to the payment of any amounts owing to Borrowers as a result of
any judgment of a court of competent jurisdiction obtained by any Borrower
against such Defaulting Lender as a result of such Defaulting Lender’s breach of
its obligations under this Agreement; and eighth, to such Defaulting Lender or
as otherwise directed by a court of competent jurisdiction; provided that if
(x) such payment is a payment of the principal amount of any Loans or
Reimbursement Obligations in respect of which such Defaulting Lender has not
fully funded its appropriate share, and (y) such Loans were made or the related
Letters of Credit were issued at a time when the conditions set forth in
Section 3.1 were satisfied or waived, such payment shall be applied solely to
pay the Loans of, and Reimbursement Obligations owed to, all Non-Defaulting
Lenders on a pro rata basis prior to being applied to the payment of any Loans
of, or Reimbursement Obligations owed to, such Defaulting Lender until such time
as all Loans and funded and unfunded participations in L/C Obligations and Swing
Loans are held by the Lenders pro rata in accordance with the Commitments under
the applicable Facility without giving effect to Section 8.7(a)(iv).  Any
payments, prepayments or other amounts paid or payable to a Defaulting Lender
that are applied (or held) to pay amounts owed by a Defaulting Lender or to post
Cash Collateral pursuant to this Section 8.7(a)(ii) shall be deemed paid to and
redirected by such Defaulting Lender, and each Lender irrevocably consents
hereto.

 

(iii)          Certain Fees.  (A) No Defaulting Lender shall be entitled to
receive any Commitment Fee for any period during which that Lender is a
Defaulting Lender (and Borrowers shall not be required to pay any such fee that
otherwise would have been required to have been paid to that Defaulting Lender).

 

(B)          Each Defaulting Lender shall be entitled to receive L/C Fees for
any period during which that Lender is a Defaulting Lender only to the extent
allocable to its Applicable Percentage of the stated amount of Letters of Credit
for which it has provided Cash Collateral pursuant to Section 8.8.

 

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(C)          With respect to any L/C Fee not required to be paid to any
Defaulting Lender pursuant to clause (B) above, Borrowers shall (x) pay to each
Non-Defaulting Lender that portion of any such fee otherwise payable to such
Defaulting Lender with respect to such Defaulting Lender’s participation in L/C
Obligations that has been reallocated to such Non-Defaulting Lender pursuant to
clause (iv) below, (y) pay to the L/C Issuer the amount of any such fee
otherwise payable to such Defaulting Lender to the extent allocable to such L/C
Issuer’s Fronting Exposure to such Defaulting Lender, and (z) not be required to
pay the remaining amount of any such fee.

 

(iv)          Reallocation of Participations to Reduce Fronting Exposure.  All
or any part of such Defaulting Lender’s participation in L/C Obligations and
Swing Loans shall be reallocated among the Non-Defaulting Lenders in accordance
with their respective Applicable Percentages (calculated without regard to such
Defaulting Lender’s Commitment) but only to the extent that (x) the conditions
set forth in Section 3.1 are satisfied at the time of such reallocation (and,
unless Borrowers shall have otherwise notified the Agent at such time, Borrowers
shall be deemed to have represented and warranted that such conditions are
satisfied at such time), and (y) such reallocation does not cause the aggregate
Revolving Credit Exposure of any Non-Defaulting Lender to exceed such
Non-Defaulting Lender’s Revolving Credit Commitment.  No reallocation hereunder
shall constitute a waiver or release of any claim of any party hereunder against
a Defaulting Lender arising from that Lender having become a Defaulting Lender,
including any claim of a Non-Defaulting Lender as a result of such
Non-Defaulting Lender’s increased exposure following such reallocation.

 

(v)           Cash Collateral, Repayment of Swing Loans.  If the reallocation
described in clause (iv) above cannot, or can only partially, be effected,
Borrowers shall, without prejudice to any right or remedy available to them
hereunder or under law, (x) first, prepay Swing Loans in an amount equal to the
Swing Line Lenders’ Fronting Exposure and (y) second, Cash Collateralize the L/C
Issuers’ Fronting Exposure in accordance with the procedures set forth in
Section 8.8.

 

(b)           Defaulting Lender Cure.  If Borrower Representative, the Agent and
each Swing Line Lender and L/C Issuer agree in writing that a Lender is no
longer a Defaulting Lender, the Agent will so notify the parties hereto,
whereupon as of the effective date specified in such notice and subject to any
conditions set forth therein (which may include arrangements with respect to any
Cash Collateral), that Lender will, to the extent applicable, purchase at par
that portion of outstanding Loans of the other Lenders or take such other
actions as the Agent may determine to be necessary to cause the Loans and funded
and unfunded participations in Letters of Credit and Swing Loans to be held pro
rata by the Lenders in accordance with the Commitments under the applicable
Facility (without giving effect to Section 8.7(a)(iv), whereupon such Lender
will cease to be a Defaulting Lender; provided that no adjustments will be made
retroactively with respect to fees accrued or payments made by or on behalf of
Borrowers while that Lender was a Defaulting Lender; and provided, further, that
except to the extent otherwise expressly agreed by the affected parties, no
change hereunder from Defaulting Lender to Lender will constitute a waiver or
release of any claim of any party hereunder arising from that Lender’s having
been a Defaulting Lender.

 

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(c)           New Swing Loans/Letters of Credit.  So long as any Lender is a
Defaulting Lender, (i) no Swing Line Lender shall be required to fund any Swing
Loans unless it is satisfied that it will have no Fronting Exposure after giving
effect to such Swing Loan and (ii) no L/C Issuer shall be required to issue,
extend, renew or increase any Letter of Credit unless it is satisfied that it
will have no Fronting Exposure after giving effect thereto.

 

Section 8.8            Cash Collateral.

 

(a)           Cash Collateral.  At any time that there shall exist a Defaulting
Lender, within one Business Day following the written request of the Agent or
any L/C Issuer (with a copy to the Agent) Borrowers shall Cash Collateralize the
L/C Issuers’ Fronting Exposure with respect to such Defaulting Lender
(determined after giving effect to Section 8.7(a)(iv) and any Cash Collateral
provided by such Defaulting Lender) in an amount not less than the Minimum
Collateral Amount.

 

(b)           Grant of Security Interest.  Each Borrower, and to the extent
provided by any Defaulting Lender, such Defaulting Lender, hereby grants to the
Agent, for the benefit of the L/C Issuers, and agrees to maintain, a first
priority security interest in all such Cash Collateral as security for the
Defaulting Lenders’ obligation to fund participations in respect of L/C
Obligations, to be applied pursuant to clause (b) below.  If at any time the
Agent determines that Cash Collateral is subject to any right or claim of any
Person other than the Agent and the L/C Issuers as herein provided, or that the
total amount of such Cash Collateral is less than the Minimum Collateral Amount,
Borrowers will, promptly upon demand by the Agent, pay or provide to the Agent
additional Cash Collateral in an amount sufficient to eliminate such deficiency
(after giving effect to any Cash Collateral provided by the Defaulting Lender).

 

(c)           Application.  Notwithstanding anything to the contrary contained
in this Agreement, Cash Collateral provided under this Section 8.8 or
Section 8.7 in respect of Letters of Credit shall be applied to the satisfaction
of the Defaulting Lender’s obligation to fund participations in respect of L/C
Obligations (including, as to Cash Collateral provided by a Defaulting Lender,
any interest accrued on such obligation) for which the Cash Collateral was so
provided, prior to any other application of such property as may otherwise be
provided for herein.

 

(d)           Termination of Requirement.  Cash Collateral (or the appropriate
portion thereof) provided to reduce any L/C Issuer’s Fronting Exposure shall no
longer be required to be held as Cash Collateral pursuant to this Section 8.8
following (i) the elimination of the applicable Fronting Exposure (including by
the termination of Defaulting Lender status of the applicable Lender), or
(ii) the determination by the Agent and the L/C Issuer that there exists excess
Cash Collateral; provided that, subject to Section 8.7, the Person providing
Cash Collateral and the L/C Issuer may agree that Cash Collateral shall be held
to support future anticipated Fronting Exposure or other obligations and
provided further that to the extent that such Cash Collateral was provided by
Borrowers, such Cash Collateral shall remain subject to the security interest
granted pursuant to the Loan Documents.

 

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SECTION 9

 

THE AGENT.

 

Section 9.1                                    Appointment and Authority.  Each
of the Lenders and the L/C Issuers hereby irrevocably appoints Fifth Third to
act on its behalf as the Agent hereunder and under the other Loan Documents and
authorizes the Agent to take such actions on its behalf and to exercise such
powers as are delegated to the Agent by the terms hereof or thereof, together
with such actions and powers as are reasonably incidental thereto.  The
provisions of this Article are solely for the benefit of the Agent, the Lenders
and the L/C Issuers, and no Credit Party shall have rights as a third-party
beneficiary of any of such provisions.  It is understood and agreed that the use
of the term “agent” herein or in any other Loan Documents (or any other similar
term) with reference to the Agent is not intended to connote any fiduciary or
other implied (or express) obligations arising under agency doctrine of any
applicable law.  Instead such term is used as a matter of market custom, and is
intended to create or reflect only an administrative relationship between
contracting parties.

 

Section 9.2                                    Rights as a Lender.  The Person
serving as the 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 Agent, and the term “Lender” or “Lenders” shall, unless otherwise
expressly indicated or unless the context otherwise requires, include the Person
serving as the Agent hereunder in its individual capacity.  Such Person and its
Affiliates may accept deposits from, lend money to, own securities of, act as
the financial advisor or in any other advisory capacity for, and generally
engage in any kind of business with, any Credit Party or any Subsidiary or other
Affiliate thereof as if such Person were not the Agent hereunder and without any
duty to account therefor to the Lenders.

 

Section 9.3                                    Exculpatory Provisions.  (a) The
Agent shall not have any duties or obligations except those expressly set forth
herein and in the other Loan Documents, and its duties hereunder shall be
administrative in nature.  Without limiting the generality of the foregoing, the
Agent:

 

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

 

(ii)                                  shall not have any duty to take any
discretionary action or exercise any discretionary powers, except discretionary
rights and powers expressly contemplated hereby or by the other Loan Documents
that the Agent is required to exercise as directed in writing by the Required
Lenders (or such other number or percentage of the Lenders as shall be expressly
provided for herein or in the other Loan Documents); provided that the Agent
shall not be required to take any action that, in its opinion or the opinion of
its counsel, may expose the Agent to liability or that is contrary to any Loan
Document or applicable law, including for the avoidance of doubt any action that
may be in violation of the automatic stay under any Debtor Relief Law or that
may effect a forfeiture, modification or termination of property of a Defaulting
Lender in violation of any Debtor Relief Law; and

 

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

 

(b)                                 The Agent shall not be liable for any action
taken or not taken by it (i) with the consent or at the request of the Required
Lenders (or such other number or percentage of the Lenders as shall be
necessary, or as the Agent shall believe in good faith shall be necessary, under
the circumstances as provided in Sections 10.11, 7.2 or 7.3), or (ii) in the
absence of its own gross negligence or willful misconduct as determined by a
court of competent jurisdiction by final and nonappealable judgment.  The Agent
shall be deemed not to have knowledge of any Default and/or Event of Default
unless and until notice describing such Default and/or Event of Default is given
to the Agent in writing by Borrower Representative, a Lender or an L/C Issuer.

 

(c)                                  The Agent shall not be responsible for or
have any duty to ascertain or inquire into (i) any statement, warranty or
representation made in or in connection with this Agreement or any other Loan
Document, (ii) the contents of any certificate, report or other document
delivered hereunder or thereunder or in connection herewith or therewith,
(iii) the performance or observance of any of the covenants, agreements or other
terms or conditions set forth herein or therein or the occurrence of any Default
and/or Event of Default, (iv) the validity, enforceability, effectiveness or
genuineness of this Agreement, any other Loan Document or any other agreement,
instrument or document, or (v) the satisfaction of any condition set forth in
Section 3 or elsewhere herein, other than to confirm receipt of items expressly
required to be delivered to the Agent.

 

Section 9.4                                    Reliance by Agent.  The Agent
shall be entitled to rely upon, and shall not incur any liability for relying
upon, any notice, request, certificate, consent, statement, instrument, document
or other writing (including any electronic message, Internet or intranet website
posting or other distribution) believed by it to be genuine and to have been
signed, sent or otherwise authenticated by the proper Person.  The Agent also
may rely upon any statement made to it orally or by telephone and believed by it
to have been made by the proper Person, and shall not incur any liability for
relying thereon.  In determining compliance with any condition hereunder to the
making of a Loan, or the issuance, extension, renewal or increase of a Letter of
Credit, that by its terms must be fulfilled to the satisfaction of a Lender or
an L/C Issuer, the Agent may presume that such condition is satisfactory to such
Lender or L/C Issuer unless the Agent shall have received notice to the contrary
from such Lender or L/C Issuer prior to the making of such Loan or the issuance
of such Letter of Credit.  The Agent may consult with legal counsel (who may be
counsel for Borrower Representative), 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.

 

Section 9.5                                    Delegation of Duties.  The Agent
may perform any and all of its duties and exercise its rights and powers
hereunder or under any other Loan Document by or through any one or more
sub-agents appointed by the Agent.  The Agent and any such sub-agent may perform
any and all of its duties and exercise its rights and powers by or through their
respective Related Parties.  The exculpatory provisions of this Article shall
apply to any such sub-agent and

 

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to the Related Parties of the Agent and any such sub-agent, and shall apply to
their respective activities in connection with the syndication of the Facilities
as well as activities as Agent.  The Agent shall not be responsible for the
negligence or misconduct of any sub-agents except to the extent that a court of
competent jurisdiction determines in a final and nonappealable judgment that the
Agent acted with gross negligence or willful misconduct in the selection of such
sub-agents.

 

Section 9.6                                    Resignation of Agent.  (a) The
Agent may at any time give notice of its resignation to the Lenders, the L/C
Issuers and Borrower Representative.  Upon receipt of any such notice of
resignation, the Required Lenders shall have the right, in consultation with
Borrower Representative, to appoint a successor, which shall be a bank with an
office in the United States, or an Affiliate of any such bank with an office in
the United States.  If no such successor shall have been so appointed by the
Required Lenders and shall have accepted such appointment within 30 days after
the retiring Agent gives notice of its resignation (or such earlier day as shall
be agreed by the Required Lenders) (the “Resignation Effective Date”), then the
retiring Agent may (but shall not be obligated to), on behalf of the Lenders and
the L/C Issuers, appoint a successor Agent meeting the qualifications set forth
above.  Whether or not a successor has been appointed, such resignation shall
become effective in accordance with such notice on the Resignation Effective
Date.

 

(b)                                 If the Person serving as Agent is a
Defaulting Lender pursuant to clause (d) of the definition thereof, the Required
Lenders may, to the extent permitted by applicable law, by notice in writing to
Borrower Representative and such Person remove such Person as Agent and, in
consultation with Borrower Representative, appoint a successor.  If no such
successor shall have been so appointed by the Required Lenders and shall have
accepted such appointment within 30 days (or such earlier day as shall be agreed
by the Required Lenders) (the “Removal Effective Date”), then such removal shall
nonetheless become effective in accordance with such notice on the Removal
Effective Date.

 

(c)                                  With effect from the Resignation Effective
Date or the Removal Effective Date (as applicable) (1) the retiring or removed
Agent shall be discharged from its duties and obligations hereunder and under
the other Loan Documents (except that in the case of any collateral security
held by the Agent on behalf of the Lenders or the L/C Issuers under any of the
Loan Documents, the retiring or removed Agent shall continue to hold such
collateral security until such time as a successor Agent is appointed and has
become perfected in the Collateral) and (2) except for any indemnity payments
owed to the retiring or removed Agent, all payments, communications and
determinations provided to be made by, to or through the Agent shall instead be
made by or to each Lender and L/C Issuer directly, until such time, if any, as
the Required Lenders appoint a successor Agent as provided for above.  Upon the
acceptance of a successor’s appointment as Agent hereunder, such successor shall
succeed to and become vested with all of the rights, powers, privileges and
duties of the retiring or removed Agent (other than any rights to indemnity
payments owed to the retiring or removed Agent), and the retiring or removed
Agent shall be discharged from all of its duties and obligations hereunder or
under the other Loan Documents.  The fees payable by Borrowers to a successor
Agent shall be the same as those payable to its predecessor unless otherwise
agreed between Borrower Representative and such successor.  After the retiring
or removed Agent’s resignation or removal hereunder and under the other Loan
Documents, the provisions of this Article and Section 10.11 shall continue

 

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in effect for the benefit of such retiring or removed 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 or removed Agent was acting as Agent.

 

Section 9.7                                    Non-Reliance on Agent and Other
Lenders.  Each Lender and L/C Issuer acknowledges that it has, independently and
without reliance upon the 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 L/C Issuer also acknowledges that it will,
independently and without reliance upon the Agent or any other Lender or any of
their Related Parties and based on such documents and information as it shall
from time to time deem appropriate, continue to make its own decisions in taking
or not taking action under or based upon this Agreement, any other Loan Document
or any related agreement or any document furnished hereunder or thereunder.

 

Section 9.8                                    No Other Duties, etc.  Anything
herein to the contrary notwithstanding, none of the Bookrunners, Arrangers, any
Syndication Agent, Documentation Agent or Collateral Agent, or other titles as
necessary listed on the cover page hereof shall have any powers, duties or
responsibilities under this Agreement or any of the other Loan Documents, except
in its capacity, as applicable, as the Agent, a Lender or an L/C Issuer
hereunder.

 

Section 9.9                                    Agent May File Proofs of Claim. 
In case of the pendency of any proceeding under any Debtor Relief Law or any
other judicial proceeding relative to any Credit Party, the Agent (irrespective
of whether the principal of any Loan or L/C Obligation shall then be due and
payable as herein expressed or by declaration or otherwise and irrespective of
whether the Agent shall have made any demand on Borrower Representative) shall
be entitled and empowered (but not obligated) by intervention in such proceeding
or otherwise:

 

(a)                                 to file and prove a claim for the whole
amount of the principal and interest owing and unpaid in respect of the Loans,
L/C Obligations and all other Obligations that are owing and unpaid and to file
such other documents as may be necessary or advisable in order to have the
claims of the Lenders, the L/C Issuers and the Agent (including any claim for
the reasonable compensation, expenses, disbursements and advances of the
Lenders, the L/C Issuers and the Agent and their respective agents and counsel
and all other amounts due the Lenders, the L/C Issuers and the Agent under
Sections 2.13 and 10.13) allowed in such judicial proceeding; and

 

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

 

and any custodian, receiver, assignee, trustee, liquidator, sequestrator or
other similar official in any such judicial proceeding is hereby authorized by
each Lender and L/C Issuer to make such payments to the Agent and, in the event
that the Agent shall consent to the making of such payments directly to the
Lenders and the L/C Issuers, to pay to the Agent any amount due for the
reasonable compensation, expenses, disbursements and advances of the Agent and
its agents and counsel, and any other amounts due the Agent under Sections 2.13
and 10.13.

 

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Section 9.10                             Collateral and Guaranty Matters. 
(a) The Lenders irrevocably authorize the Agent, at its option and in its
discretion,

 

(i)                                     to release any Lien on any property
granted to or held by the Agent under any Loan Document (x) upon termination of
all Commitments and Payment in Full of all Obligations and the expiration or
termination of all Letters of Credit (other than Letters of Credit as to which
other arrangements reasonably satisfactory to the Agent and the L/C Issuer shall
have been made), (y) that is sold or otherwise disposed of or to be sold or
otherwise disposed of as part of or in connection with any sale or other
disposition permitted under the Loan Documents, or (z) subject to Section 10.9, 
if approved, authorized or ratified in writing by the Required Lenders;

 

(ii)                                  to subordinate any Lien on any property
granted to or held by the Agent under any Loan Document to the holder of any
Lien on such property that is permitted by Section 6.12(e); and

 

(iii)                               to release any Guarantor from its
obligations under the Guaranty if such Person ceases to be a Subsidiary as a
result of a transaction permitted under the Loan Documents.

 

Upon request by the Agent at any time, the Required Lenders will confirm in
writing the Agent’s authority to release or subordinate its interest in
particular types or items of property, or to release any Guarantor from its
obligations under the Guaranty pursuant to this Section 10.

 

(b)                                 The Agent shall not be responsible for or
have a duty to ascertain or inquire into any representation or warranty
regarding the existence, value or collectability of the Collateral, the
existence, priority or perfection of the Agent’s Lien thereon, or any
certificate prepared by any Credit Party in connection therewith, nor shall the
Agent be responsible or liable to the Lenders for any failure to monitor or
maintain any portion of the Collateral.

 

Section 9.11                             Authorization to Enter into, and
Enforcement of, the Collateral Documents.  The Agent is hereby irrevocably
authorized by each of the Lenders to execute and deliver the Collateral
Documents on behalf of each of the Lenders and their Affiliates and to take such
action and exercise such powers under the Collateral Documents as the Agent
considers appropriate; provided that the Agent shall not amend the Collateral
Documents unless such amendment is agreed to in writing by the Required Lenders;
provided further that the consent of the Required Lenders shall not be required
to amend any account control agreement, landlord waiver, bailee waiver or
similar agreement.  Each Lender acknowledges and agrees that it will be bound by
the terms and conditions of the Collateral Documents upon the execution and
delivery thereof by the Agent.  Except as otherwise specifically provided for
herein, no Lender (or its Affiliates) other than the Agent shall have the right
to institute any suit, action or proceeding in equity or at law for the
foreclosure or other realization upon any Collateral or for the execution of any
trust or power in respect of the Collateral or for the appointment of a receiver
or for the enforcement of any other remedy under the Collateral Documents; it
being understood and intended that no one or more of the Lenders (or their
Affiliates) shall have any right in any manner whatsoever to affect, disturb or
prejudice the Lien of the Agent (or any security trustee therefor) under the
Collateral Documents by its or their action or to enforce any right thereunder,

 

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and that all proceedings at law or in equity shall be instituted, had, and
maintained by the Agent (or its security trustee) in the manner provided for in
the relevant Collateral Documents for the benefit of the Lenders and their
Affiliates.

 

Section 9.12                             Designation of Additional Agents.  The
Agent shall have the continuing right, for purposes hereof, at any time and from
time to time to designate one or more of the Lenders (and/or its or their
Affiliates) as “syndication agents,” “documentation agents,” “arrangers” or
other designations for purposes hereto, but such designation shall have no
substantive effect, and such Lenders and their Affiliates shall have no
additional powers, duties or responsibilities as a result thereof.

 

SECTION 10

 

MISCELLANEOUS.

 

Section 10.1                             No Waiver; Cumulative Remedies.  No
delay or failure on the part of the Agent or any Lender or on the part of the
holder or holders of any of the Obligations in the exercise of any power or
right under any Loan Document shall operate as a waiver thereof or as an
acquiescence in any default, nor shall any single or partial exercise of any
power or right preclude any other or further exercise thereof or the exercise of
any other power or right.  The rights and remedies hereunder of the Agent, the
Lenders and of the holder or holders of any of the Obligations are cumulative
to, and not exclusive of, any rights or remedies which any of them would
otherwise have.

 

Section 10.2                             Non-Business Days.  If any payment
hereunder becomes due and payable on a day which is not a Business Day, the due
date of such payment shall be extended to the next succeeding Business Day on
which date such payment shall be due and payable.  In the case of any payment of
principal falling due on a day which is not a Business Day, interest on such
principal amount shall continue to accrue during such extension at the rate per
annum then in effect, which accrued amount shall be due and payable on the next
scheduled date for the payment of interest.

 

Section 10.3                             Survival of Representations.  All
representations and warranties made herein or in any other Loan Document or in
certificates given pursuant hereto or thereto shall survive the execution and
delivery of this Agreement and the other Loan Documents, and shall continue in
full force and effect with respect to the date as of which they were made as
long as any Lender or the L/C Issuer has any Commitment hereunder or any
Obligations remain unpaid hereunder.

 

Section 10.4                             Survival of Indemnities.  All
indemnities and other provisions relative to reimbursement to the Lenders of
amounts sufficient to protect the yield of the Lenders with respect to the Loans
and Letters of Credit, including, but not limited to, Sections 8.1, 8.4, 10.1,
10.4 and 10.13 hereof, shall survive the termination of this Agreement and the
other Loan Documents and the Payment in Full of the Obligations.

 

Section 10.5                             Sharing of Set-Off.  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

 

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its Loans or other obligations hereunder resulting in such Lender receiving
payment of a proportion of the aggregate amount of its Loans and accrued
interest thereon or other such obligations greater than its pro rata share
thereof as provided herein, then the Lender receiving such greater proportion
shall (a) notify the Agent of such fact, and (b) purchase (for cash at face
value) participations in the Loans and such other obligations of the other
Lenders, or make such other adjustments as shall be equitable, so that the
benefit of all such payments shall be shared by the Lenders ratably in
accordance with the aggregate amount of principal of and accrued interest on
their respective Loans and other amounts owing them; provided that:

 

(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 (x) any payment made by Borrowers pursuant to and in
accordance with the express terms of this Agreement (including the application
of funds arising from the existence of a Defaulting Lender), or (y) 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 Reimbursement Obligations
to any assignee or participant, other than to any Borrower or any Subsidiary
thereof (as to which the provisions of this paragraph shall apply).

 

Each Credit Party consents to the foregoing and agrees, to the extent it may
effectively do so under applicable law, that any Lender acquiring a
participation pursuant to the foregoing arrangements may exercise against each
Credit Party rights of setoff and counterclaim with respect to such
participation as fully as if such Lender were a direct creditor of each Credit
Party in the amount of such participation.

 

Section 10.6                             Notices.

 

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

 

(i)                                     if to any Credit Party, c/o Borrower
Representative, to it at 100 Cherokee Cove Drive, Vonore, Tennessee 37885,
Attention of Tim Oxley (Facsimile No. (423) 884-2222; Telephone No. (423)
884-7829), with a copy to Wayzata Investment Partners, 701 East Lake Street,
Suite 300, Wayzata, MN 55391, Attention:  Susan D. Peterson (Facsimile
No. 952-345-8901; Telephone No. 952-345-0700), with a copy to Wayzata Investment
Partners, 701 East Lake Street, Suite 300, Wayzata, MN 55391, Attention:  Ray T.
Wallander (Facsimile No. 952-345-8901; Telephone No. 952-345-0700), with a copy
(which shall not constitute notice) to King & Spalding LLP, 100 N. Tryon Street,
Suite 3900, Charlotte, North Carolina, Attention: W. Todd Holleman (Facsimile
No. 704-503-2622; Telephone No. 704-503-2567).

 

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(ii)                                  if to the Agent, to Fifth Third at Fifth
Third Bank, as Agent, 222 South Riverside Plaza, 30th Floor, Chicago, Illinois
60606, Attention of Adolph Letke (Facsimile No. 312-704-4127; Telephone
No. (312) 704-6164;

 

(iii)                               if to Fifth Third Bank in its capacity as
L/C Issuer, to it at 222 South Riverside Plaza, 30th Floor, Chicago, Illinois
60606, Attention of Adolph Letke (Facsimile No. 312-704-4127; Telephone
No. (312) 704-6164), and if to any other L/C Issuer, to it at the address
provided in writing to the Agent and Borrower Representative at the time of its
appointment as an L/C Issuer hereunder;

 

(iv)                              if to a Lender, to it at its address (or
facsimile number) set forth in its Administrative Questionnaire or on the
signature pages hereto.

 

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

 

(b)                                 Electronic Communications.  Notices and
other communications to the Lenders and the L/C Issuers hereunder may be
delivered or furnished by electronic communication (including e-mail and
Internet or intranet websites) pursuant to procedures approved by the Agent,
provided that the foregoing shall not apply to notices to any Lender or L/C
Issuer pursuant to Section 2.5 if such Lender or L/C Issuer, as applicable, has
notified the Agent that it is incapable of receiving notices under such
Article by electronic communication.  The Agent or Borrower Representative may,
in its discretion, agree to accept notices and other communications to it
hereunder by electronic communications pursuant to procedures approved by it;
provided that approval of such procedures may be limited to particular notices
or communications.

 

Unless the Agent otherwise prescribes, (i) notices and other communications sent
to an e-mail address shall be deemed received upon the sender’s receipt of an
acknowledgement from the intended recipient (such as by the “return receipt
requested” function, as available, return e-mail or other written
acknowledgement), and (ii) notices or communications posted to an Internet or
intranet website shall be deemed received upon the deemed receipt by the
intended recipient, at its e-mail address as described in the foregoing
clause (i), of notification that such notice or communication is available and
identifying the website address therefor; provided that, for both
clauses (i) and (ii) above, if such notice, email or other communication is not
sent during the normal business hours of the recipient, such notice or
communication shall be deemed to have been sent at the opening of business on
the next business day for the recipient.

 

(c)                                  Change of Address, etc.  Any party hereto
may change its address or facsimile number for notices and other communications
hereunder by notice to the other parties hereto.

 

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(d)                                 Platform.

 

(i)                                     Each Credit Party agrees that the Agent
may, but shall not be obligated to, make the Communications (as defined below)
available to the L/C Issuers and the other Lenders by posting the Communications
on Debt Domain, Intralinks, Syndtrak or a substantially similar electronic
transmission system (the “Platform”).

 

(ii)                                  The Platform is provided “as is” and “as
available.”  The Agent Parties (as defined below) do not warrant the adequacy of
the Platform and expressly disclaim liability for errors or omissions in the
Communications.  No warranty of any kind, express, implied or statutory,
including, without limitation, any warranty of merchantability, fitness for a
particular purpose, non-infringement of third-party rights or freedom from
viruses or other code defects, is made by any Agent Party in connection with the
Communications or the Platform.  In no event shall the Agent or any of its
Related Parties (collectively, the “Agent Parties”) have any liability to any
Credit Party, any Lender or any other Person or entity for damages of any kind,
including, without limitation, direct or indirect, special, incidental or
consequential damages, losses or expenses (whether in tort, contract or
otherwise) arising out of any Credit Party’s or the Agent’s transmission of
communications through the Platform.  “Communications” means, collectively, any
notice, demand, communication, information, document or other material provided
by or on behalf of any Credit Party pursuant to any Loan Document or the
transactions contemplated therein which is distributed to the Agent, any Lender
or any L/C Issuer by means of electronic communications pursuant to this
Section, including through the Platform.

 

Section 10.7                             Counterparts.  This Agreement may be
executed in counterparts (and by different parties hereto in different
counterparts), each of which shall constitute an original, but all of which when
taken together shall constitute a single contract.  This Agreement and the other
Loan Documents, and any separate letter agreements with respect to fees payable
to the Agent, constitute the entire contract among the parties relating to the
subject matter hereof and supersede any and all previous agreements and
understandings, oral or written, relating to the subject matter hereof.  Except
as provided in Section 3, this Agreement shall become effective when it shall
have been executed by the Agent and when the Agent shall have received
counterparts hereof that, when taken together, bear the signatures of each of
the other parties hereto.  Delivery of an executed counterpart of a signature
page of this Agreement by facsimile or in electronic (i.e., “pdf” or “tif”)
format shall be effective as delivery of a manually executed counterpart of this
Agreement.

 

Section 10.8                             Successors and Assigns; Assignments and
Participations.

 

(a)                                 Successors and Assigns Generally.  The
provisions of this Agreement shall be binding upon and inure to the benefit of
the parties hereto and their respective successors and assigns permitted hereby,
except that no Credit Party assign or otherwise transfer any of its rights or
obligations hereunder without the prior written consent of the Agent and each
Lender, and no Lender may assign or otherwise transfer any of its rights or
obligations hereunder except (i) to an assignee in accordance with the
provisions of paragraph (b) of this Section, (ii) by way of participation in
accordance with the provisions of paragraph (d) of this Section, or (iii) by way

 

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of pledge or assignment of a security interest subject to the restrictions of
paragraph (f) of this Section (and any other attempted assignment or transfer by
any party hereto shall be null and void).  Nothing in this Agreement, expressed
or implied, shall be construed to confer upon any Person (other than the parties
hereto, their respective successors and assigns permitted hereby, Participants
to the extent provided in paragraph (d) of this Section and, to the extent
expressly contemplated hereby, the Related Parties of each of the Agent and the
Lenders) any legal or equitable right, remedy or claim under or by reason of
this Agreement.

 

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

 

(i)                                     Minimum Amounts.

 

(A)                               in the case of an assignment of the entire
remaining amount of the assigning Lender’s Commitment and/or the Loans at the
time owing to it (in each case with respect to any Facility) or contemporaneous
assignments to related Approved Funds that equal at least the amount specified
in paragraph (b)(i)(B) of this Section in the aggregate or in the case of an
assignment to a Lender, an Affiliate of a Lender or an Approved Fund, no minimum
amount need be assigned; and

 

(B)                               in any case not described in
paragraph (b)(i)(A) of this Section, the aggregate amount of the Commitment
(which for this purpose includes Loans outstanding thereunder) or, if the
applicable Commitment is not then in effect, the principal outstanding balance
of the Loans of the assigning Lender subject to each such assignment (determined
as of the date the Assignment and Assumption with respect to such assignment is
delivered to the Agent or, if “Trade Date” is specified in the Assignment and
Assumption, as of the Trade Date) shall not be less than $1,000,000 in the case
of any assignment in respect of the Revolving Loans, or $1,000,000, in the case
of any assignment in respect of the Term Loan, unless each of the Agent and, so
long as no Event of Default has occurred and is continuing, Borrower
Representative otherwise consents (each such consent not to be unreasonably
withheld or delayed).

 

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

 

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

 

(A)                               the consent of Borrower Representative (such
consent not to be unreasonably withheld or delayed) shall be required unless
(x) an Event of Default has occurred and is continuing at the time of such
assignment, or (y) such assignment is to a Lender, an Affiliate of a Lender or
an Approved Fund; provided that Borrower Representative shall be deemed to have
consented to any such assignment unless it shall object thereto by written
notice to the Agent within 5 Business Days after having received notice thereof
and provided, further, that Borrower Representative’s consent shall not be
required during the primary syndication of the Facilities;

 

(B)                               the consent of the Agent (such consent not to
be unreasonably withheld or delayed) shall be required for assignments in
respect of (i) the Revolving Loans or any unfunded Commitments with respect to
the Term Loan if such assignment is to a Person that is not a Lender with a
Commitment in respect of such Loan, an Affiliate of such Lender or an Approved
Fund with respect to such Lender, or (ii) any Term Loans to a Person who is not
a Lender, an Affiliate of a Lender or an Approved Fund;

 

and

 

(C)                               the consent of the L/C Issuer and each Swing
Line Lender shall be required for any assignment in respect of the Revolving
Loans.

 

(iv)                              Assignment and Assumption.  The parties to
each assignment shall execute and deliver to the Agent an Assignment and
Assumption, together with a processing and recordation fee of $3,500; provided
that the Agent may, in its sole discretion, elect to waive such processing and
recordation fee in the case of any assignment.  The assignee, if it is not a
Lender, shall deliver to the Agent an Administrative Questionnaire.

 

(v)                                 No Assignment to Certain Persons.  No such
assignment shall be made to (A) any Credit Party, the Sponsor or any of their
respective Affiliates or Subsidiaries, except as permitted under Sections 10.08
(g) and 10.08 (h), (B) to any Defaulting Lender or any of its Subsidiaries, or
any Person who, upon becoming a Lender hereunder, would constitute any of the
foregoing Persons described in this clause (B) or (C) to any of the entities
listed on Schedule 10.8(b).

 

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

 

(vii)                           Certain Additional Payments.  In connection with
any assignment of rights and obligations of any Defaulting Lender hereunder, no
such assignment shall be effective unless and until, in addition to the other
conditions thereto set forth herein, the parties to the assignment shall make
such additional payments to the Agent in an

 

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aggregate amount sufficient, upon distribution thereof as appropriate (which may
be outright payment, purchases by the assignee of participations or
subparticipations, or other compensating actions, including funding, with the
consent of Borrower Representative and the Agent, the applicable pro rata share
of Loans previously requested but not funded by the Defaulting Lender, to each
of which the applicable assignee and assignor hereby irrevocably consent), to
(x) pay and satisfy in full all payment liabilities then owed by such Defaulting
Lender to the Agent, the L/C Issuer, each Swing Line Lender and each other
Lender hereunder (and interest accrued thereon), and (y) acquire (and fund as
appropriate) its full pro rata share of all Loans and participations in Letters
of Credit and Swing Loans in accordance with its Applicable Percentage. 
Notwithstanding the foregoing, in the event that any assignment of rights and
obligations of any Defaulting Lender hereunder shall become effective under
applicable law without compliance with the provisions of this paragraph, then
the assignee of such interest shall be deemed to be a Defaulting Lender for all
purposes of this Agreement until such compliance occurs.

 

Subject to acceptance and recording thereof by the Agent pursuant to
paragraph (c) of this Section, from and after the effective date specified in
each Assignment and Assumption, the assignee thereunder shall be a party to this
Agreement and, to the extent of the interest assigned by such Assignment and
Assumption, have the rights and obligations of a Lender under this Agreement,
and the assigning Lender thereunder shall, to the extent of the interest
assigned by such Assignment and Assumption, be released from its obligations
under this Agreement (and, in the case of an Assignment and Assumption covering
all of the assigning Lender’s rights and obligations under this Agreement, such
Lender shall cease to be a party hereto) but shall continue to be entitled to
the benefits of Sections 8.4 and 10.11 with respect to facts and circumstances
occurring prior to the effective date of such assignment; provided, that except
to the extent otherwise expressly agreed by the affected parties, no assignment
by a Defaulting Lender will constitute a waiver or release of any claim of any
party hereunder arising from that Lender’s having been a Defaulting Lender.  Any
assignment or transfer by a Lender of rights or obligations under this Agreement
that does not comply with this paragraph 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 (d) of this Section.

 

(c)                                  Register.  The Agent, acting solely for
this purpose as an agent of Borrowers, shall maintain at one of its offices in
Cincinnati, Ohio a copy of each Assignment and Assumption delivered to it and a
register for the recordation of the names and addresses of the Lenders, and the
Commitments of, and principal amounts (and stated interest) of the Loans owing
to, each Lender pursuant to the terms hereof from time to time (the
“Register”).  The entries in the Register shall be conclusive absent manifest
error, and the Credit Parties, the Agent and the Lenders shall treat each Person
whose name is recorded in the Register pursuant to the terms hereof as a Lender
hereunder for all purposes of this Agreement.  The Register shall be available
for inspection by Borrower Representative and any Lender, at any reasonable time
and from time to time upon reasonable prior notice. This Section 10.8(c) is
intended to qualify the Loans as obligations in “registered form” for purposes
of the Code including Treasury Regulation 1.871-14(c) promulgated thereunder,
and shall be interpreted consistently therewith.

 

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(d)                                 Participations.  Any Lender may at any time,
without the consent of, or notice to, Borrower Representative or the Agent, sell
participations to any Person (other than a natural Person or any Credit Party or
any Credit Party’s Affiliates or Subsidiaries) (each, a “Participant”) in all or
a portion of such Lender’s rights and/or obligations under this Agreement
(including all or a portion of its Commitment and/or the Loans owing to it);
provided that (i) such Lender’s obligations under this Agreement shall remain
unchanged, (ii) such Lender shall remain solely responsible to the other parties
hereto for the performance of such obligations, and (iii) the Credit Parties,
the Agent, the L/C Issuers and Lenders shall continue to deal solely and
directly with such Lender in connection with such Lender’s rights and
obligations under this Agreement.  For the avoidance of doubt, each Lender shall
be responsible for the indemnity under Section 10.11(c) with respect to any
payments made by such Lender to its Participant(s).

 

Any agreement or instrument pursuant to which a Lender sells such a
participation shall provide that such Lender shall retain the sole right to
enforce this Agreement and to approve any amendment, modification or waiver of
any provision of this Agreement; provided that such agreement or instrument may
provide that such Lender will not, without the consent of the Participant, agree
to any amendment, modification or waiver described in Section 10.9(b) that
affects such Participant.  Each Credit Party agrees that each Participant shall
be entitled to the benefits of Sections 8.4, 8.1 and 8.5 (subject to the
requirements and limitations therein, including the requirements under
Section 8.5(g) (it being understood that the documentation required under
Section 8.5(g) shall be delivered to the participating Lender)) to the same
extent as if it were a Lender and had acquired its interest by assignment
pursuant to paragraph (b) of this Section; provided that such Participant
(A) agrees to be subject to the provisions of Section 8.6 as if it were an
assignee under paragraph (b) of this Section; and (B) shall not be entitled to
receive any greater payment under Sections 8.4 or 8.5, with respect to any
participation, than its participating Lender would have been entitled to
receive, except to the extent such entitlement to receive a greater payment
results from a Change in Law that occurs after the Participant acquired the
applicable participation.  Each Lender that sells a participation agrees, at
Borrower Representative’s request and expense, to use reasonable efforts to
cooperate with Borrower Representative to effectuate the provisions of
Section 8.6 with respect to any Participant.  To the extent permitted by law,
each Participant also shall be entitled to the benefits of Section 10.12 as
though it were a Lender; provided that such Participant agrees to be subject to
Section 10.5 as though it were a Lender.  Each Lender that sells a participation
shall, acting solely for this purpose as an agent of Borrowers, maintain a
register on which it enters the name and address of each Participant and the
principal amounts (and stated interest) of each Participant’s interest in the
Loans or other obligations under the Loan Documents (the “Participant
Register”); provided that no Lender shall have any obligation to disclose all or
any portion of the Participant Register (including the identity of any
Participant or any information relating to a Participant’s interest in any
commitments, loans, letters of credit or its other obligations under any Loan
Document) to any Person except to the extent that such disclosure is necessary
to establish that such commitment, loan, letter of credit or other obligation is
in registered form under Section 5f.103-1(c) of the United States Treasury
Regulations.  The entries in the Participant Register shall be conclusive absent
manifest error, and such Lender shall treat each Person whose name is recorded
in the Participant Register as the owner of such participation for all purposes
of this Agreement notwithstanding any notice to the contrary.  For the avoidance
of doubt, the Agent (in its capacity as Agent) shall have no responsibility for
maintaining a Participant Register.

 

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

 

(f)                                   Electronic Execution of Assignments.  The
words “execution,” “signed,” “signature,” and words of like import in any
Assignment and Assumption shall be deemed to include electronic signatures or
the keeping of records in electronic form, each of which shall be of the same
legal effect, validity or enforceability as a manually executed signature or the
use of a paper-based recordkeeping system, as the case may be, to the extent and
as provided for in any applicable law, including the Federal Electronic
Signatures in Global and National Commerce Act, the Illinois Electronic Commerce
Security Act, or any other similar state laws whether or not based on the
Uniform Electronic Transactions Act.

 

(g)                                  Affiliated Lenders.  (i) Subject to
Section 10.08(b) and this Section 10.08(g), any Lender shall have the right at
any time to sell, transfer and assign all or a portion of its Term Loan
(“Applicable Loan”) to the Sponsor or any of the Sponsor Entities (the
“Affiliated Lenders”), to the extent that:

 

(A)                               the aggregate principal amount of all Term
Loans which may be assigned to the Affiliated Lenders shall in no event exceed,
as calculated at the time of the consummation of any aforementioned assignments,
25% of the aggregate principal amount of the Term Loans then outstanding;

 

(B)                               each Term Lender shall have the right to sell,
transfer and assign to such Affiliated Lender, in its sole discretion, on a pro
rata basis, the amount of its Term Loan Percentage in such Applicable Loans; and

 

(C)                               the assigning Lender and the Affiliated Lender
purchasing such Lender’s Applicable Loans shall execute and deliver to the Agent
an assignment agreement substantially in the form of Exhibit F (an “Affiliated
Lender Assignment and Assumption”).

 

Notwithstanding anything to the contrary in this Agreement, no Affiliated Lender
shall have any right to (A) attend (including by telephone) any meeting or
discussions (or portion thereof) among the Agent or any Lender to which
representatives of the Credit Parties are not invited, or (B) receive any
information or material prepared by the Agent or any Lender or any communication
by or among the Agent and/or one or more Lenders, except to the extent such
information or materials have been made available to any Credit Party or its
representatives.

 

(ii)                                  Notwithstanding anything in Section 10.09
or the definition of “Required Lenders” to the contrary, for purposes of
determining whether the Required Lenders or all affected Lenders or all Lenders
have (A) consented (or not consented) to any amendment, modification, waiver,
consent or other action with respect to any of the terms of any Loan Document or
any departure by any Credit Party therefrom, (B) otherwise acted on any matter
related to any Loan Document, or (C) directed or

 

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required the Agent or any Lender to undertake any action (or refrain from taking
any action) with respect to or under any Loan Document, an Affiliated Lender
shall be deemed to have voted its interest as a Lender without discretion in the
same proportion as the allocation of voting with respect to such matter by
Lenders who are not Affiliated Lenders; provided that (x) under no circumstances
shall any Affiliated Lenders be permitted to exercise any voting rights or other
privileges with respect to any Applicable Loans and any Applicable Loans that
are assigned to, owned by, or maintained for the benefit of, any Affiliated
Lender shall have no voting rights or other privileges under the Loan Documents
(and all voting percentages shall be recalculated to give effect to such voting
nullification), except as permitted under Section 10.9 (b) (2) and (3) hereof;
and in furtherance of the foregoing, the Affiliated Lender agrees to execute and
deliver to the Agent any instrument reasonably requested by the Agent to
evidence the voting of its interest as a Lender in accordance with the
provisions of this Section 10.08(g); provided, further, that if the Affiliated
Lender fails to promptly execute such instrument such failure shall in no way
prejudice any of the Agent’s or any Lender’s rights under this paragraph.

 

(iii)                               Each Affiliated Lender, solely in its
capacity as a Lender, hereby agrees, and each Affiliated Lender Assignment and
Assumption shall provide a confirmation that, if any Credit Party shall be
subject to any voluntary or involuntary proceeding commenced under any
insolvency or liquidation proceeding or proceeding under the Bankruptcy Code
(collectively, a “Proceeding”), (i) such Affiliated Lender shall not take any
step or action in such Proceeding to object to, impede, or delay the exercise of
any right or the taking of any action by the Agent (or the taking of any action
by a third party that is supported by the Agent) in relation to such Affiliated
Lender’s claim with respect to its Applicable Loans (including, without
limitation, objecting to any debtor in possession financing, use of cash
collateral, grant of adequate protection, sale or disposition, compromise, or
plan of reorganization) so long as such Affiliated Lender in its capacity as a
Lender is treated in connection with such exercise or action on the same or
better terms as the other Lenders and (ii) with respect to any matter requiring
the vote of Lenders during the pendency of any such Proceeding (including,
without limitation, voting on any plan of reorganization), the Applicable Loans
held by such Affiliated Lender (and any claim with respect thereto) shall be
deemed to be voted in accordance with clause (iii) of this Section 10.08(g), so
long as such Affiliated Lender in its capacity as a Lender is treated in
connection with the exercise of such right or taking of such action on the same
or not materially worse terms as the other Lenders.  For the avoidance of doubt,
the Lenders and each Affiliated Lender agree and acknowledge that the provisions
set forth in this clause (iii), and the related provisions set forth in each
Affiliated Lender Assignment and Assumption, constitute a “subordination
agreement” as such term is contemplated by, and utilized in, Section 510(a) of
the Bankruptcy Code, and, as such, would be enforceable for all purposes in any
case where a Credit Party has filed for protection under any law relating to
bankruptcy, insolvency or reorganization or relief of debtors applicable to such
Credit Party.

 

(iv)                              (A) With respect to all purchases made by, or
assignments to, an Affiliated Lender pursuant to this Section 10.08(g), such
Affiliated Lender shall pay to the applicable assigning Lender all accrued and
unpaid interest, if any, on the purchased

 

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Applicable Loans to the date of purchase of such Applicable Loans and (B) with
respect to all purchases made by, assignments to, or assignments made by, an
Affiliated Lender pursuant to this Section 10.08(g), such Affiliated Lender
shall represent to the Lender assigning or purchasing such Term Loan and the
Agent that, as of the effective date of any Affiliated Lender Assignment and
Assumption, it is not in possession of any material non-public information
regarding the Credit Parties, or their assets or securities, that (x) has not
been disclosed generally to the Lenders which are not Public Lenders prior to
such date and (y) could reasonably be expected to have a material effect upon,
or otherwise be material to, a Lender’s decision to assign Applicable Loans to
such Person.

 

(h)                                 Assignments to Borrower.  Notwithstanding
anything to the contrary contained herein, any Lender may sell, transfer and
assign all or any portion of its Term Loan to any Borrower, but only if any such
Loans shall be automatically and permanently cancelled immediately upon
acquisition thereof by such Borrower; provided that each Term Lender shall have
the right to sell, transfer and assign, in its sole discretion, on a pro rata
basis, the amount of its Term Loan Percentage in such Applicable Loans. Agent
will not consent to such assignment unless it has notified each Term Lender, as
applicable, of such proposed assignment to any Borrower and given such Lender at
least three (3) Business Days to decide whether it will participate in such
assignment.

 

Section 10.9                             Amendments.  Any (a) No failure or
delay by the Agent, any L/C Issuer or any Lender in exercising any right or
power hereunder or under any other Loan Document shall operate as a waiver
thereof, nor shall any single or partial exercise of any such right or power, or
any abandonment or discontinuance of steps to enforce such 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 Agent, the L/C Issuers and the
Lenders hereunder and under any other Loan Document are cumulative and are not
exclusive of any rights or remedies that they would otherwise have.  No waiver
of any provision of any Loan Document or consent to any departure by any Credit
Party therefrom shall in any event be effective unless the same shall be
permitted by paragraph (b) of this Section, and then such waiver or consent
shall be effective only in the specific instance and for the purpose for which
given.  Without limiting the generality of the foregoing, the making of a Loan
or issuance of a Letter of Credit shall not be construed as a waiver of any
Default, regardless of whether the Agent, any Lender or any L/C Issuer may have
had notice or knowledge of such Default at the time.

 

(b)                                 Neither this Agreement nor any other Loan
Document nor any provision hereof or thereof may be waived, amended or modified
except (i) in the case of this Agreement, pursuant to an agreement or agreements
in writing entered into by Borrowers and the Required Lenders or (ii) in the
case of any other Loan Document, pursuant to an agreement or agreements in
writing entered into by the Agent and the Credit Parties that are parties
thereto, with the consent of the Required Lenders; provided that no such
agreement shall (A) increase the Commitment of any Lender without the written
consent of such Lender (including any such Lender that is a Defaulting Lender),
(B) reduce or forgive the principal amount of any Loan or LC Disbursement or
reduce the rate of interest thereon, or reduce or forgive any interest or fees
payable hereunder, without the written consent of each Lender (including any
such Lender that is a Defaulting Lender) affected thereby, (C) postpone any
scheduled date of payment of the principal amount of any Loan or LC
Disbursement, or any date for the payment of any interest,

 

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fees or other Obligations payable hereunder, or reduce the amount of, waive or
excuse any such payment, or postpone the scheduled date of expiration of any
Commitment, without the written consent of each Lender (including any such
Lender that is a Defaulting Lender) affected thereby, (D) change Section 2.9
(Place and Application of Payments) in a manner that would alter the manner in
which payments are shared, without the written consent of each Lender (including
any such Lender that is a Defaulting Lender), (E) amend the definition of
“Applicable Advance Multiple” without the written consent of each Revolving
Lender (other than any Defaulting Lender), (F) change any of the provisions of
this Section or the definition of “Required Lenders” or any other provision of
any Loan Document specifying the number or percentage of Lenders (or Lenders of
any Class) 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 (including any such Lender that is a Defaulting Lender) directly
affected thereby, (G) change Section 8.7 (Defaulting Lenders), without the
consent of each Lender (other than any Defaulting Lender), (H) release any
Guarantor from its Guarantied Obligations (except as otherwise permitted herein
or in the other Loan Documents), without the written consent of each Lender
(other than any Defaulting Lender), or (I) except as provided in this
Section 10.9 or in any Collateral Document, release all or substantially all of
the Collateral, without the written consent of each Lender (other than any
Defaulting Lender); provided further that (i) no such agreement shall amend,
modify or otherwise affect the rights or duties of the Agent, any L/C Issuer or
the Swing Loan Lender hereunder without the prior written consent of the Agent,
such L/C Issuer or the Swing Loan Lender, as the case may be (it being
understood that any change to Section 8.7 (Defaulting Lenders) shall require the
consent of the Agent, each L/C Issuer and the Swing Loan Lender), (ii) any
amendment, modification or waiver of the definitions of Revolving Loan Limit,
Applicable Advance Multiple, or Revolving Loan Availability, and any amendment,
modification or waiver of the conditions to making Revolving Loans set forth in
Section 3.2, shall require the consent of the Required Revolving Lenders and the
Term Lenders shall have no vote in respect thereof, and (iii) any waiver or
amendment to cure any ambiguity, omission, defect or inconsistency in any Loan
Document shall only require the signature of Agent and Borrowers.  The Agent may
also amend the Schedule 1 (Commitments) to reflect assignments entered into
pursuant to Section 10.8.

 

Notwithstanding anything to the contrary herein, no Defaulting Lender shall have
any right to approve or disapprove any amendment, waiver or consent hereunder,
except that the Commitments of such Lender may not be increased or extended
without the consent of such Lender.

 

Section 10.10                      Headings.  Section headings used in this
Agreement are for reference only and shall not affect the construction of this
Agreement.

 

Section 10.11                      Costs and Expenses; Indemnification.

 

(a)                                 Costs and Expenses.  The Credit Parties
shall pay (i) all reasonable out-of-pocket expenses incurred by the Agent and
its Affiliates (including the reasonable fees, charges and disbursements of
counsel for the Agent), in connection with the syndication of the Facilities,
the preparation, negotiation, execution, delivery and administration of this
Agreement and the other Loan Documents, or any amendments, modifications or
waivers of the provisions hereof or thereof (whether or not the transactions
contemplated hereby or thereby shall be consummated),

 

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(ii) all reasonable out-of-pocket expenses incurred by any L/C Issuer in
connection with the issuance, amendment, renewal or extension of any Letter of
Credit or any demand for payment thereunder, and (iii) all out-of-pocket
expenses incurred by the Agent, any Lender or any L/C Issuer (including the
fees, charges and disbursements of any counsel for the Agent, any Lender or any
L/C Issuer), any Lender or any L/C Issuer, in connection with the enforcement or
protection of its rights (A) in connection with this Agreement and the other
Loan Documents, including its rights under this Section, or (B) in connection
with the Loans made or Letters of Credit issued hereunder, including all such
out-of-pocket expenses incurred during any workout, restructuring or
negotiations in respect of such Loans or Letters of Credit.

 

(b)                                 Indemnification by the Credit Parties.  The
Credit Parties shall indemnify the Agent (and any sub-agent thereof), each
Lender and the L/C Issuer, and each Related Party of any of the foregoing
Persons (each such Person being called an “Indemnitee”) against, and hold each
Indemnitee harmless from, any and all losses, claims, damages, liabilities and
related expenses (including the fees, charges and disbursements of any counsel
for any Indemnitee),  incurred by any Indemnitee or asserted against any
Indemnitee by any Person (including any Credit Party) arising out of, in
connection with, or as a result of (i) the execution or delivery of this
Agreement, any other Loan Document or any agreement or instrument contemplated
hereby or thereby, the performance by the parties hereto of their respective
obligations hereunder or thereunder or the consummation of the transactions
contemplated hereby or thereby, (ii) any Loan or Letter of Credit or the use or
proposed use of the proceeds therefrom (including any refusal by any L/C Issuer
to honor a demand for payment under a Letter of Credit if the documents
presented in connection with such demand do not strictly comply with the terms
of such Letter of Credit), (iii) any actual or alleged presence or Release of
Hazardous Materials on or from any property owned or operated by any Credit
Party or any of its Subsidiaries, or any Environmental Liability related in any
way to any Credit Party or any of its Subsidiaries, 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 any Credit Party or any Subsidiary or Affiliates
of any Credit Party, 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 (x) are determined by a court of competent jurisdiction by
final and nonappealable judgment to have resulted from the gross negligence or
willful misconduct of such Indemnitee or (y) result from a claim brought by any
Credit Party against an Indemnitee for breach in bad faith of such Indemnitee’s
obligations hereunder or under any other Loan Document, such Credit Party has
obtained a final and nonappealable judgment in its favor on such claim as
determined by a court of competent jurisdiction or (z) are limited as provided
in the Environmental Indemnity Agreement, dated of even date herewith, of the
Credit Parties in favor of Agent and the Lenders.  This Section 10.11 (b) shall
not apply with respect to Taxes other than any Taxes that represent losses,
claims, damages, etc. arising from any non-Tax claim.

 

(c)                                  Reimbursement by Lenders.  To the extent
that the Credit Parties for any reason fail to indefeasibly pay any amount
required under paragraph (a) or (b) of this Section to be paid by it to the
Agent (or any sub-agent thereof), any L/C Issuer, any Swing Line Lender or any
Related Party of any of the foregoing, each Lender severally agrees to pay to
the Agent (or any such sub-agent), such L/C Issuer, such Swing Line Lender or
such Related Party, as the case may be, such Lender’s pro rata share (determined
as of the time that the applicable unreimbursed

 

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expense or indemnity payment is sought based on each Lender’s share of the Total
Credit Exposure at such time) of such unpaid amount (including any such unpaid
amount in respect of a claim asserted by such Lender); provided that with
respect to such unpaid amounts owed to any L/C Issuer or Swing Line Lender
solely in its capacity as such, only the Revolving Lenders shall be required to
pay such unpaid amounts, such payment to be made severally among them based on
such Revolving Lenders’ Applicable Percentage (determined as of the time that
the applicable unreimbursed expense or indemnity payment is sought) provided,
further, 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 Agent (or any such sub-agent), such L/C Issuer or such Swing Line
Lender in its capacity as such, or against any Related Party of any of the
foregoing acting for the Agent (or any such sub-agent), such L/C Issuer or any
such Swing Line Lender in connection with such capacity.  The obligations of the
Lenders under this paragraph (c) are subject to the provisions of Section 10.18.

 

(d)                                 Waiver of Consequential Damages, Etc.  To
the fullest extent permitted by applicable law, none of Agent, any Lender, L/C
Issuer, Swing Line Lender or any Credit Party,  shall assert, and hereby waives,
any claim against any Indemnitee and any Credit Party, on any theory of
liability, for special, indirect, consequential or punitive damages (as opposed
to direct or actual damages) arising out of, in connection with, or as a result
of, this Agreement, any other Loan Document or any agreement or instrument
contemplated hereby, the transactions contemplated hereby or thereby, any Loan
or Letter of Credit, or the use of the proceeds thereof.  No Indemnitee referred
to in paragraph (b) above shall be liable for any damages arising from the use
by unintended recipients of any information or other materials distributed by it
through telecommunications, electronic or other information transmission systems
in connection with this Agreement or the other Loan Documents or the
transactions contemplated hereby or thereby.

 

(e)                                  Payments.  All amounts due under this
Section shall be payable promptly (and, in any event within 3 Business Days)
after demand therefor.

 

(f)                                   Survival.  Each party’s obligations under
this Section shall survive the termination of the Loan Documents and payment of
the obligations hereunder.

 

Section 10.12                      Set-off.  Subject to Section 2.15(b), if an
Event of Default shall have occurred and be continuing, each Lender, the L/C
Issuer, and each of their respective Affiliates is hereby authorized at any time
and from time to time, with prior written notice to Agent, to the fullest extent
permitted by applicable law, to set off and apply any and all deposits (general
or special, time or demand, provisional or final, in whatever currency) at any
time held, and other obligations (in whatever currency) at any time owing, by
such Lender, such L/C Issuer or any such Affiliate, to or for the credit or the
account of any Credit Party against any and all of the Obligations of such
Credit Party now or hereafter existing under this Agreement or any other Loan
Document to such Lender or such L/C Issuer or their respective Affiliates,
irrespective of whether or not such Lender, L/C Issuer or Affiliate shall have
made any demand under this Agreement or any other Loan Document and although
such obligations of such Credit Party may be contingent or unmatured or are owed
to a branch, office or Affiliate of such Lender or such L/C Issuer different
from the branch, office or Affiliate holding such deposit or obligated on such
indebtedness; provided that in the event that any Defaulting Lender shall
exercise any such right of setoff, (x) all amounts so set off shall be paid over
immediately to the Agent for further

 

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application in accordance with the provisions of Section 8.7 and, pending such
payment, shall be segregated by such Defaulting Lender from its other funds and
deemed held in trust for the benefit of the Agent, the L/C Issuers, and the
Lenders, and (y) the Defaulting Lender shall provide promptly to the Agent a
statement describing in reasonable detail the Obligations owing to such
Defaulting Lender as to which it exercised such right of setoff.  The rights of
each Lender, the L/C Issuer and their respective Affiliates under this
Section are in addition to other rights and remedies (including other rights of
setoff) that such Lender, such L/C Issuer or their respective Affiliates may
have.  Each Lender and L/C Issuer agrees to notify Borrower Representative and
the Agent promptly after any such setoff and application; provided that the
failure to give such notice shall not affect the validity of such setoff and
application.

 

Section 10.13                      Entire Agreement.  The Loan Documents
constitute the entire understanding of the parties thereto with respect to the
subject matter thereof and any prior agreements, whether written or oral, with
respect thereto are superseded hereby.

 

Section 10.14                      Governing Law.  This Agreement and the other
Loan Documents and any claims, controversy, dispute or cause of action (whether
in contract or tort or otherwise) based upon, arising out of or relating to this
Agreement or any other Loan Document (except, as to any other Loan Document, as
expressly set forth therein) and the transactions contemplated hereby and
thereby shall be governed by, and construed in accordance with, internal laws of
the State of Illinois (including, without limitation, 735 ILCS Section 105/5-1
et seq., but otherwise without regard to the conflict of laws provisions) of the
State of Illinois.

 

Section 10.15                      Severability of Provisions.  Any provision of
any Loan Document which is unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such unenforceability without
invalidating the remaining provisions hereof or affecting the validity or
enforceability of such provision in any other jurisdiction.  All rights,
remedies and powers provided in this Agreement and the other Loan Documents may
be exercised only to the extent that the exercise thereof does not violate any
applicable mandatory provisions of law, and all the provisions of this Agreement
and other Loan Documents are intended to be subject to all applicable mandatory
provisions of law which may be controlling and to be limited to the extent
necessary so that they will not render this Agreement or the other Loan
Documents invalid or unenforceable.

 

Section 10.16                      Excess Interest.  Notwithstanding any
provision to the contrary contained herein or in any other Loan Document, no
such provision shall require the payment or permit the collection of any amount
of interest in excess of the maximum amount of interest permitted by applicable
law to be charged for the use or detention, or the forbearance in the
collection, of all or any portion of the Loans or other obligations outstanding
under this Agreement or any other Loan Document (“Excess Interest”).  If any
Excess Interest is provided for, or is adjudicated to be provided for, herein or
in any other Loan Document, then in such event (a) the provisions of this
Section shall govern and control, (b) neither any Credit Party, any other
obligor or endorser shall be obligated to pay any Excess Interest, (c) any
Excess Interest that the Agent or any Lender may have received hereunder shall,
at the option of the Agent, be (i) applied as a credit against the then
outstanding principal amount of Obligations hereunder and accrued and unpaid
interest thereon (not to exceed the maximum amount permitted by applicable law),
(ii) refunded to Borrowers, or (iii) any combination of the foregoing, (d) the
interest rate payable hereunder or

 

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under any other Loan Document shall be automatically subject to reduction to the
maximum lawful contract rate allowed under applicable usury laws (the “Maximum
Rate”), and this Agreement and the other Loan Documents shall be deemed to have
been, and shall be, reformed and modified to reflect such reduction in the
relevant interest rate, and (e) neither any Credit Party or any other obligor or
endorser shall have any action against the Agent or any Lender for any Damages
whatsoever arising out of the payment or collection of any Excess Interest. 
Notwithstanding the foregoing, if for any period of time interest on any of the
Obligations is calculated at the Maximum Rate rather than the applicable rate
under this Agreement, and thereafter such applicable rate becomes less than the
Maximum Rate, the rate of interest payable on the Obligations shall remain at
the Maximum Rate until the Lenders have received the amount of interest which
such Lenders would have received during such period on the Obligations had the
rate of interest not been limited to the Maximum Rate during such period.

 

Section 10.17                      Construction.  The parties acknowledge and
agree that the Loan Documents shall not be construed more favorably in favor of
any party hereto based upon which party drafted the same, it being acknowledged
that all parties hereto contributed substantially to the negotiation of the Loan
Documents.  The provisions of this Agreement relating to Subsidiaries shall
apply only during such times as any Credit Party has one or more Subsidiaries. 
Nothing contained herein shall be deemed or construed to permit any act or
omission which is prohibited by the terms of any Collateral Document, the
covenants and agreements contained herein being in addition to and not in
substitution for the covenants and agreements contained in the Collateral
Documents.

 

Section 10.18                      Lender’s and L/C Issuer’s Obligations
Several.  The obligations of the Lenders and L/C Issuers hereunder are several
and not joint.  Nothing contained in this Agreement and no action taken by the
Lenders or L/C Issuers pursuant hereto shall be deemed to constitute the Lenders
or L/C Issuers a partnership, association, joint venture or other entity.

 

Section 10.19                      USA PATRIOT Act.  Each Lender hereby notifies
each of the Credit Parties that pursuant to the requirements of the PATRIOT Act
it is required to obtain, verify and record information that identifies each of
the Credit Parties, which information includes the name and address of each of
the Credit Parties and other information that will allow such Lender to identify
each of the Credit Parties in accordance with the PATRIOT Act.

 

Section 10.20                      Submission to Jurisdiction; Waiver of Jury
Trial.

 

(a)                                 Jurisdiction.  Each Credit Party irrevocably
and unconditionally agrees that it will not commence any action, litigation or
proceeding of any kind or description, whether in law or equity, whether in
contract or in tort or otherwise, against the Agent, any Lender, any L/C Issuer,
or any Related Party of the foregoing in any way relating to this Agreement or
any other Loan Document or the transactions relating hereto or thereto, in any
forum other than the courts of the State of Illinois sitting in Cook County, and
of the United States District Court of the Northern District of Illinois
(Eastern Division), and any appellate court from any thereof, and each of the
parties hereto irrevocably and unconditionally submits to the jurisdiction of
such courts and agrees that all claims in respect of any such action, litigation
or proceeding may be heard and determined in such Illinois State court or, to
the fullest extent permitted by applicable law, in such federal court.  Each of
the parties hereto agrees that a final judgment in any such

 

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action, litigation or proceeding shall be conclusive and may be enforced in
other jurisdictions by suit on the judgment or in any other manner provided by
law.  Nothing in this Agreement or in any other Loan Document shall affect any
right that the Agent, any Lender or any L/C Issuer may otherwise have to bring
any action or proceeding relating to this Agreement or any other Loan Document
against any Credit Party or its properties in the courts of any jurisdiction.

 

(b)                                 Waiver of Venue.  Each Credit Party
irrevocably and unconditionally waives, to the fullest extent permitted by
applicable law, any objection that it may now or hereafter have to the laying of
venue of any action or proceeding arising out of or relating to this Agreement
or any other Loan Document in any court referred to in paragraph (b) of this
Section.  Each of the parties hereto hereby irrevocably waives, to the fullest
extent permitted by applicable law, the defense of an inconvenient forum to the
maintenance of such action or proceeding in any such court.

 

(c)                                  Service of Process.  Each party hereto
irrevocably consents to service of process in the manner provided for notices in
Section 10.6.  Nothing in this Agreement will affect the right of any party
hereto to serve process in any other manner permitted by applicable law.

 

(d)                                 WAIVER OF JURY TRIAL.  EACH PARTY HERETO
HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW,
ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR
INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER LOAN
DOCUMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY (WHETHER BASED ON
CONTRACT, TORT OR ANY OTHER THEORY).  EACH PARTY HERETO (A) CERTIFIES THAT NO
REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PERSON HAS REPRESENTED, EXPRESSLY
OR OTHERWISE, THAT SUCH OTHER PERSON WOULD NOT, IN THE EVENT OF LITIGATION, SEEK
TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER
PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT AND THE OTHER LOAN
DOCUMENTS BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS
SECTION.

 

Section 10.21                      Treatment of Certain Information;
Confidentiality.  Each of the Agent, the Lenders and the L/C Issuers agree to
maintain the confidentiality of the Information (as defined below), except that
Information may be disclosed (a) to its Affiliates and to its Related Parties
(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 required or requested by any
regulatory authority purporting to have jurisdiction over such Person or its
Related Parties (including any self-regulatory authority, such as the National
Association of Insurance Commissioners); (c) to the extent required by
applicable laws or regulations or by any subpoena or similar legal process;
(d) to any other party hereto; (e) in connection with the exercise of any
remedies hereunder or under any other Loan Document or any action or proceeding
relating to this Agreement or any other Loan Document or the enforcement of
rights hereunder or thereunder; (f) subject to an agreement containing
provisions substantially the same as those of this Section, to (i) any assignee
of or Participant in, or any

 

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prospective assignee of or Participant in, any of its rights and obligations
under this Agreement, or (ii) any actual or prospective party (or its Related
Parties) to any swap, derivative or other transaction under which payments are
to be made by reference to any Borrower and its obligations, this Agreement or
payments hereunder; (g) on a confidential basis to (i) any rating agency in
connection with rating any Credit Party or its Subsidiaries or the Facilities or
(ii) the CUSIP Service Bureau or any similar agency in connection with the
issuance and monitoring of CUSIP numbers with respect to the Facilities;
(h) with the consent of Borrower Representative; or (i) to the extent such
Information (x) becomes publicly available other than as a result of a breach of
this Section, or (y) becomes available to the Agent, any Lender, any L/C Issuer
or any of their respective Affiliates on a nonconfidential basis from a source
other than any Credit Party.

 

For purposes of this Section, “Information” means all information received from
any Credit Party or any of its Subsidiaries relating to any Credit Party or any
of its Subsidiaries or any of their respective businesses, other than any such
information that is available to the Agent, any Lender or any L/C Issuer on a
nonconfidential basis prior to disclosure by any Credit Party or any of its
Subsidiaries; provided that, in the case of information received from any Credit
Party or any of its Subsidiaries after the date hereof, such information is
clearly identified at the time of delivery as confidential.  Any Person required
to maintain the confidentiality of Information as provided in this Section shall
be considered to have complied with its obligation to do so if such Person has
exercised the same degree of care to maintain the confidentiality of such
Information as such Person would accord to its own confidential information.

 

Section 10.22                      Subordination of Intercompany Indebtedness. 
Each Credit Party hereby agrees that any Indebtedness of any other Credit Party
or any Subsidiary of such Credit Party or any other Credit Party now or
hereafter owing to such Credit Party, whether heretofore, now or hereafter
created (the “Credit Party Subordinated Debt”), is hereby subordinated to all of
the Obligations and that, upon the occurrence and during the continuance of an
Event of Default, the Credit Party Subordinated Debt shall not be paid in whole
or in part until Payment in Full of the Obligations.  No Credit Party shall make
or accept any payment of or on account of any Credit Party Subordinated Debt at
any time in contravention of the foregoing.  Each payment on the Credit Party
Subordinated Debt received in violation of any of the provisions hereof shall be
deemed to have been received by such Credit Party as trustee for the Agent and
shall be paid over to the Agent immediately on account of the Obligations, but
without otherwise affecting in any manner such Credit Party’s liability
hereunder.  Each Credit Party agrees to file all claims against the Credit Party
from whom the Credit Party Subordinated Debt is owing in any bankruptcy or other
proceeding in which the filing of claims is required by law in respect of any
Credit Party Subordinated Debt, and the Agent shall be entitled to all of such
Credit Party’s rights thereunder.  If for any reason any Credit Party fails to
file such claim at least ten (10) Business Days prior to the last date on which
such claim should be filed, such Credit Party hereby irrevocably appoints the
Agent as its true and lawful attorney-in-fact, and the Agent is hereby
authorized to act as attorney-in-fact in such Credit Party’s name to file such
claim or, in the Agent’s discretion, to assign such claim to and cause proof of
claim to be filed in the name of the Agent or its nominee.  In all such cases,
whether in administration, bankruptcy or otherwise, the Person or Persons
authorized to pay such claim shall pay to the Agent the full amount payable on
the claim in the proceeding, and, to the full extent necessary for that purpose,
each Credit Party hereby assigns to the Agent all of such Credit Party’s rights
to any payments or

 

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distributions to which such Credit Party otherwise would be entitled.  If the
amount so paid is greater than such Credit Party’s liability hereunder, the
Agent shall pay the excess amount to the party entitled thereto.  In addition,
each Credit Party hereby irrevocably appoints the Agent as its attorney-in-fact
to exercise all of such Credit Party’s voting rights in connection with any
bankruptcy proceeding or any plan for the reorganization of any Borrower or any
Credit Party from whom the Credit Party Subordinated Debt is owing.

 

Section 10.23                      Prior Agreements.

 

(a)                                 This Agreement shall become effective, and
shall amend and restate the Existing Credit Agreement, upon the execution of
this Agreement by Borrowers, Holdings, Agent and the Lenders and upon the
satisfaction of the conditions contained in herein; and from and after the
Second Restatement Closing Date (i) all references made to the Existing Credit
Agreement in the other Loan Documents or in any other instrument or document
executed and/or delivered pursuant thereto shall, without any further action, be
deemed to refer to this Agreement, and (ii) the Existing Credit Agreement shall
be deemed amended and restated in its entirety hereby.

 

(b)                                 This Agreement and the other Loan Documents
executed and delivered in connection herewith are entered into and delivered to
Agent and the Lenders in replacement of and substitution for, and not in payment
of or satisfaction for, the Existing Credit Agreement and related documents and
instruments.  This Agreement and the other Loan Documents, including, the other
instruments, documents and agreements executed and delivered in connection with
the Existing Credit Agreement, as the same may be or have been amended, restated
or otherwise modified on or prior to the Second Restatement Closing Date, are
hereby reaffirmed and shall continue in full force and effect.  Each of the
Credit Parties acknowledges that the Loans and other Obligations evidenced by
the Existing Credit Agreement as of the Second Restatement Closing Date have not
been satisfied but instead have become part of the joint and several Loans and
Obligations under this Agreement and under the other Loan Documents executed
and/or delivered in connection herewith.  Each of the Credit Parties further
acknowledges that (1) all of the Liens granted by Borrowers and Holdings under
the Existing Security Agreement and any other Collateral Document, and (2) all
instruments, documents and agreements executed in connection with the Original
Loan Agreement and the Existing Credit Agreement, as the same may be or have
been amended, restated or otherwise modified on or prior to the Second
Restatement Closing Date, are hereby reaffirmed and shall continue hereafter to
secure the Obligations under this Agreement and the other Loan Documents so long
as any portion of the Obligations remains outstanding.

 

SECTION 11

 

GUARANTY.

 

Section 11.1                             Guaranty.  Each Credit Party (each to
be referred to in this Section 11 as a Guarantor and collectively as the
Guarantors) hereby agrees that it is jointly and severally liable for, and, as
primary obligor and not merely as surety, absolutely and unconditionally
guarantees to the Lenders the prompt payment when due, whether at stated
maturity, upon acceleration or otherwise, and at all times thereafter, of
Obligations as a Guarantor and all costs and expenses

 

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including, without limitation, all court costs and reasonable and documented
attorneys’ and paralegals’ fees (including allocated costs of in-house counsel
and paralegals) and expenses paid or incurred by the Agent, the L/C Issuers and
the Lenders in endeavoring to collect all or any part of such specific
Obligations from, or in prosecuting any action against, the obligor thereof
(such costs and expenses, together with the Obligations, collectively the
“Guarantied Obligations”).  Each Guarantor further agrees that the Guarantied
Obligations may be extended or renewed in whole or in part without notice to or
further assent from it, and that it remains bound upon its guarantee
notwithstanding any such extension or renewal.

 

Section 11.2                             Guaranty of Payment.  This Guaranty is
a guaranty of payment and not of collection.  Each Guarantor waives any right to
require the Agent, any L/C Issuer or any Lender to sue any Borrower, any
Guarantor, any other guarantor, or any other Person obligated for all or any
part of the Guarantied Obligations, or otherwise to enforce its payment against
any collateral securing all or any part of the Guarantied Obligations.

 

Section 11.3                             No Discharge or Diminishment of
Guaranty.

 

(a)                                 Except as otherwise provided for herein and
to the extent provided for herein, the obligations of each Guarantor hereunder
are unconditional and absolute and not subject to any reduction, limitation,
impairment or termination for any reason (other than the Payment in Full in cash
of the Guarantied Obligations), including: (i) any claim of waiver, release,
extension, renewal, settlement, surrender, alteration, or compromise of any of
the Guarantied Obligations, by operation of law or otherwise; (ii) any change in
the corporate existence, structure or ownership of any Borrower or any other
guarantor of or other Person liable for any of the Guarantied Obligations;
(iii) any insolvency, bankruptcy, reorganization or other similar proceeding
affecting any Borrower, any Guarantor, or any other guarantor of or other Person
liable for any of the Guarantied Obligations, or their assets or any resulting
release or discharge of any obligation of any Borrower, any Guarantor, or any
other guarantor of or other Person liable for any of the Guarantied Obligations;
or (iv) the existence of any claim, setoff or other rights which any Guarantor
may have at any time against any Borrower, any Guarantor, any other guarantor of
the Guarantied Obligations, the Agent, any L/C Issuer, any Lender, or any other
Person, whether in connection herewith or in any unrelated transactions.

 

(b)                                 The obligations of each Guarantor hereunder
are not subject to any defense or setoff, counterclaim, recoupment, or
termination whatsoever by reason of the invalidity, illegality, or
unenforceability of any of the Guarantied Obligations or otherwise, or any
provision of applicable law or regulation purporting to prohibit payment by any
Borrower, any Guarantor or any other guarantor of or other Person liable for any
of the Guarantied Obligations, of the Guarantied Obligations or any part
thereof.

 

(c)                                  Further, the obligations of any Guarantor
hereunder are not discharged or impaired or otherwise affected by: (i) the
failure of the Agent, any L/C Issuer or any Lender to assert any claim or demand
or to enforce any remedy with respect to all or any part of the Guarantied
Obligations; (ii) any waiver or modification of or supplement to any provision
of any agreement relating to the Guarantied Obligations; (iii) any release,
non-perfection, or invalidity of any indirect or direct security for the
obligations of any Borrower for all or any part of the Guarantied Obligations or
any obligations of any other guarantor of or other Person liable for

 

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any of the Guarantied Obligations; (iv) any action or failure to act by the
Agent, any L/C Issuer or any Lender with respect to any collateral securing any
part of the Guarantied Obligations; (v) any default, failure or delay, willful
or otherwise, in the payment or performance of any of the Guarantied
Obligations, or any other circumstance, act, omission or delay that might in any
manner or to any extent vary the risk of such Guarantor or that would otherwise
operate as a discharge of any Guarantor as a matter of law or equity (other than
the Payment in Full of the Guarantied Obligations).

 

Section 11.4                             Waiver of Defenses.  To the fullest
extent permitted by applicable law, each Guarantor hereby waives any defense
based on or arising out of any defense of any Borrower or any Guarantor or the
unenforceability of all or any part of the Guarantied Obligations from any
cause, or the cessation from any cause of the liability of any Borrower or any
Guarantor, other than the Payment in Full of the Guarantied Obligations. 
Without limiting the generality of the foregoing, each Guarantor irrevocably
waives acceptance hereof, presentment, demand, protest and, to the fullest
extent permitted by law, any notice not provided for herein, as well as any
requirement that at any time any action be taken by any Person against any
Borrower, any Guarantor, any other guarantor of any of the Guarantied
Obligations, or any other Person.  The Agent may, at its election, foreclose on
any Collateral held by it by one or more judicial or nonjudicial sales, accept
an assignment of any such Collateral in lieu of foreclosure or otherwise act or
fail to act with respect to any collateral securing all or a part of the
Guarantied Obligations, compromise or adjust any part of the Guarantied
Obligations, make any other accommodation with any Borrower, any Guarantor, any
other guarantor or any other Person liable on any part of the Guarantied
Obligations or exercise any other right or remedy available to it against any
Borrower, any Guarantor, any other guarantor or any other Person liable on any
of the Guarantied Obligations, without affecting or impairing in any way the
liability of such Guarantor under this Guaranty except to the extent the Payment
in Full of the Guarantied Obligations.  To the fullest extent permitted by
applicable law, each Guarantor waives any defense arising out of any such
election even though that election may operate, pursuant to applicable law, to
impair or extinguish any right of reimbursement or subrogation or other right or
remedy of any Guarantor against any Borrower, any other guarantor or any other
Person liable on any of the Guarantied Obligations, as the case may be, or any
security.

 

Section 11.5                             Rights of Subrogation.  No Guarantor
will assert any right, claim or cause of action, including, without limitation,
a claim of subrogation, contribution or indemnification that it has against any
Borrower, any Guarantor, any Person liable on the Guarantied Obligations, or any
collateral, until the Payment in Full in cash of the Obligations.

 

Section 11.6                             Reinstatement; Stay of Acceleration. 
If at any time any payment of any portion of the Guarantied Obligations is
rescinded or must otherwise be restored or returned upon the insolvency,
bankruptcy, or reorganization of any Borrower or otherwise, each Guarantor’s
obligations under this Guaranty with respect to that payment shall be reinstated
at such time as though the payment had not been made and whether or not the
Agent, the L/C Issuers and the Lenders are in possession of this Guaranty.  If
acceleration of the time for payment of any of the Guarantied Obligations is
stayed upon the insolvency, bankruptcy or reorganization of any Borrower, all
such amounts otherwise subject to acceleration under the terms of any agreement
relating to the Guarantied Obligations shall nonetheless be payable by the
Guarantors forthwith on demand by the Lender.

 

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Section 11.7                             Information.  Each Guarantor assumes
all responsibility for being and keeping itself informed of Borrowers’ financial
condition and assets, and of all other circumstances bearing upon the risk of
nonpayment of the Guarantied Obligations and the nature, scope and extent of the
risks that each Guarantor assumes and incurs under this Guaranty, and agrees
that neither the Agent, any L/C Issuer nor any Lender shall have any duty to
advise any Guarantor of information known to it regarding those circumstances or
risks.

 

Section 11.8                             Termination.  The Lenders may continue
to make loans or extend credit to any Borrower based on this Guaranty until five
(5) days after the Agent receives written notice of termination from any
Guarantor.  Notwithstanding receipt of any such notice, each Guarantor will
continue to be liable to the Lender for any Guarantied Obligations created,
assumed or committed to prior to the fifth day after receipt of the notice, and
all subsequent renewals, extensions, modifications and amendments with respect
to, or substitutions for, all or any part of that Guarantied Obligations.

 

Section 11.9                             Severability.  The provisions of this
Guaranty are severable, and in any action or proceeding involving any state
corporate law, or any state, federal or foreign bankruptcy, insolvency,
reorganization or other law affecting the rights of creditors generally, if the
obligations of any Guarantor under this Guaranty would otherwise be held or
determined to be avoidable, invalid or unenforceable on account of the amount of
such Guarantor’s liability under this Guaranty, then, notwithstanding any other
provision of this Guaranty to the contrary, the amount of such liability shall,
without any further action by the Guarantors or the Lenders, be automatically
limited and reduced to the highest amount that is valid and enforceable as
determined in such action or proceeding (such highest amount determined
hereunder being the relevant Guarantor’s “Maximum Liability”.  This Section with
respect to the Maximum Liability of each Guarantor is intended solely to
preserve the rights of the Lenders to the maximum extent not subject to
avoidance under applicable law, and no Guarantor nor any other Person or entity
shall have any right or claim under this Section with respect to such Maximum
Liability, except to the extent necessary so that the obligations of any
Guarantor hereunder shall not be rendered voidable under applicable law. Each
Guarantor agrees that the Guarantied Obligations may at any time and from time
to time exceed the Maximum Liability of each Guarantor without impairing this
Guaranty or affecting the rights and remedies of the Lenders hereunder, provided
that, nothing in this sentence shall be construed to increase any Guarantor’s
obligations hereunder beyond its Maximum Liability.

 

Section 11.10                      Contribution.  In the event any Guarantor (a
“Paying Guarantor”) shall make any payment or payments under this Guaranty or
shall suffer any loss as a result of any realization upon any collateral granted
by it to secure its obligations under this Guaranty, each other Guarantor (each
a “Non-Paying Guarantor”) shall contribute to such Paying Guarantor an amount
equal to such Non-Paying Guarantor’s “Pro Rata Share” of such payment or
payments made, or losses suffered, by such Paying Guarantor.  For purposes of
this Section 11, each Non-Paying Guarantor’s “Pro Rata Share” with respect to
any such payment or loss by a Paying Guarantor shall be determined as of the
date on which such payment or loss was made by reference to the ratio of
(i) such Non-Paying Guarantor’s Maximum Liability as of such date (without
giving effect to any right to receive, or obligation to make, any contribution
hereunder) or, if such Non-Paying Guarantor’s Maximum Liability has not been
determined, the aggregate amount of all monies received by such Non-Paying
Guarantor from Borrowers after the date

 

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hereof (whether by loan, capital infusion or by other means) to (ii) the
aggregate Maximum Liability of all Guarantors hereunder (including such Paying
Guarantor) as of such date (without giving effect to any right to receive, or
obligation to make, any contribution hereunder), or to the extent that a Maximum
Liability has not been determined for any Guarantor, the aggregate amount of all
monies received by such Guarantors from Borrowers after the date hereof (whether
by loan, capital infusion or by other means).  Nothing in this provision shall
affect any Guarantor’s several liability for the entire amount of the Guarantied
Obligations (up to such Guarantor’s Maximum Liability).  Each of the Guarantors
covenants and agrees that its right to receive any contribution under this
Guaranty from a Non-Paying Guarantor shall be subordinate and junior in right of
payment to the Payment in Full of the Guarantied Obligations.  This provision is
for the benefit of both the Agent, the L/C Issuers, the Lenders and the
Guarantors and may be enforced by any one, or more, or all of them in accordance
with the terms hereof.

 

Section 11.11                      Liability Cumulative.  The liability of each
Credit Party as a Guarantor under this Section 11 is in addition to and shall be
cumulative with all liabilities of each Credit Party to the Agent, the L/C
Issuers and the Lenders under this Agreement and the other Loan Documents to
which such Credit Party is a party or in respect of any obligations of
liabilities of the other Credit Parties, without any limitation as to amount,
unless the instrument or agreement evidencing or creating such other liability
specifically provides to the contrary.

 

Section 11.12                      Eligible Contract Participant. 
Notwithstanding anything to the contrary in any Loan Document, no Guarantor
shall be deemed under this Section 11 to be a guarantor of any Swap Obligations
if such Guarantor was not an “eligible contract participant” as defined in
§1a(18) of the Commodity Exchange Act, at the time the guarantee under this
Section 11 becomes effective with respect to such Swap Obligation and to the
extent that the providing of such guarantee by such Guarantor would violate the
Commodity Exchange Act; provided however that in determining whether any
Guarantor is an “eligible contract participant” under the Commodity Exchange
Act, the guarantee of the Credit Party Obligations of such Guarantor under this
Section 11 by a Guarantor that is also a Qualified ECP Guarantor shall be taken
into account.

 

Section 11.13                      Keepwell.  Without limiting anything in this
Section 11, each Qualified ECP Guarantor hereby jointly and severally
absolutely, unconditionally and irrevocably undertakes to provide such funds or
other support as may be needed from time to time to each Guarantor that is not
an “eligible contract participant” under the Commodity Exchange Act at the time
the guarantee under this Section 11 becomes effective with respect to any Swap
Obligation, to honor all of the Obligations of such Guarantor under this
Section 11 in respect of such Swap Obligations (provided, however, that each
Qualified ECP Guarantor shall only be liable under this Section 11.13 for the
maximum amount of such liability that can be hereby incurred without rendering
its undertaking under this Section 11.13, or otherwise under this Section 11,
voidable under applicable law relating to fraudulent conveyance or fraudulent
transfer, and not for any greater amount). The undertaking of each Qualified ECP
Guarantor under this Section 11.13 shall remain in full force and effect until
termination of the Commitments and Payment in Full of all Loans and other
Obligations. Each Qualified ECP Guarantor intends that this Section 11.13
constitute, and this Section 11.13 shall be deemed to constitute, a “keepwell,
support, or other agreement” for the benefit of each Guarantor that would
otherwise not constitute an “eligible contract participant” under the Commodity
Exchange Act.

 

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SECTION 12

 

BORROWER REPRESENTATIVE.

 

Section 12.1                             Appointment; Nature of Relationship. 
MasterCraft is hereby appointed by each of the Credit Parties as its contractual
representative (“Borrower Representative”) hereunder and under each other Loan
Document, and each of the Credit Parties irrevocably authorizes Borrower
Representative to act as the contractual representative of such Borrower with
the rights and duties expressly set forth herein and in the other Loan
Documents.  Borrower Representative agrees to act as such contractual
representative upon the express conditions contained in this Section 12. 
Additionally, Borrowers hereby appoint Borrower Representative as their agent to
receive all of the proceeds of the Loans in the Funding Account, at which time
Borrower Representative shall promptly disburse such Loans to the appropriate
Borrower.  The Agent and the Lenders, and their respective officers, directors,
agents or employees, shall not be liable to Borrower Representative, any
Borrower or any other Person for any action taken or omitted to be taken by
Borrower Representative or Borrowers pursuant to this Section 12.

 

Section 12.2                             Powers.  Borrower Representative shall
have and may exercise such powers under the Loan Documents as are specifically
delegated to Borrower Representative by the terms of each thereof, together with
such powers as are reasonably incidental thereto.  Borrower Representative may
execute any of its duties as Borrower Representative hereunder and under any
other Loan Document by or through Responsible Officers.

 

Section 12.3                             Notices.  Each Credit Party shall
immediately notify Borrower Representative of the occurrence of any Default or
Event of Default hereunder referring to this Agreement describing such Default
or Event of Default and stating that such notice is a “notice of default.”  In
the event that Borrower Representative receives such a notice, Borrower
Representative shall give prompt notice thereof to the Agent and the Lenders. 
Any notice provided to Borrower Representative hereunder shall constitute notice
to each Credit Party on the date received by Borrower Representative.

 

Section 12.4                             Successor Borrower Representative. 
Upon the prior written consent of the Agent, Borrower Representative may resign
at any time, such resignation to be effective upon the appointment of a
successor Borrower Representative.  Agent shall give prompt written notice of
such resignation to the Lenders.

 

Section 12.5                             Execution of Loan Documents.  Credit
Parties hereby empower and authorize Borrower Representative, on behalf of the
Credit Parties, to execute and deliver to the Agent and the Lenders the Loan
Documents and all related agreements, certificates, documents, or instruments as
shall be necessary or appropriate to effect the purposes of the Loan Documents,
including without limitation, the Compliance Certificates.  Each Credit Party
agrees that any action taken by Borrower Representative or the Credit Parties in
accordance with the terms of this Agreement or the other Loan Documents, and the
exercise by Borrower Representative of its powers set forth therein or herein,
together with such other powers that are reasonably incidental thereto, shall be
binding upon all of the Credit Parties.

 

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Section 12.6                             Reporting.  Each Credit Party hereby
agrees that such Credit Party shall furnish to Borrower Representative all
reports, notices, information and other documents required hereunder or
requested by Borrower Representative to enable Borrower Representative to
fulfill its duties hereunder and under the other Loan Documents on which
Borrower Representative shall rely to prepare the certificates, reports, notices
and other documents required pursuant to the provisions of this Agreement and
the other Loan Documents.

 

(Signature Pages Follow)

 

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(Signature Page to Second Amended and Restated Credit and Guaranty Agreement)

 

This Agreement is entered into between us for the uses and purposes hereinabove
set forth as of the date first above written.

 

BORROWERS:

MASTERCRAFT BOAT COMPANY, LLC, a Delaware limited liability company

 

 

 

 

By

/s/ Timothy M. Oxley

 

 

Timothy M. Oxley

 

 

Chief Financial Officer, Treasurer & Secretary

 

 

 

MCBC HYDRA BOATS, LLC, a Tennessee limited liability company

 

 

 

 

By

/s/ Timothy M. Oxley

 

 

Timothy M. Oxley

 

 

Chief Financial Officer, Treasurer & Secretary

 

 

 

MASTERCRAFT SERVICES, INC., a Tennessee corporation

 

 

 

 

By

/s/ Timothy M. Oxley

 

 

Timothy M. Oxley

 

 

Chief Financial Officer, Treasurer & Secretary

 

 

 

MASTERCRAFT INTERNATIONAL SALES ADMINISTRATION, INC., a Delaware corporation

 

 

 

 

By

/s/ Timothy M. Oxley

 

 

Timothy M. Oxley

 

 

Chief Financial Officer, Treasurer & Secretary

 

 

 

 

OTHER CREDIT PARTIES:

MCBC HOLDINGS, INC., a Delaware corporation

 

 

 

 

By

/s/ Timothy M. Oxley

 

 

Timothy M. Oxley

 

 

Chief Financial Officer, Treasurer & Secretary

 

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(Signature Page to Second Amended and Restated Credit and Guaranty Agreement)

 

AGENT AND LENDER:

FIFTH THIRD BANK, an Ohio banking corporation, as a Lender, as L/C Issuer, and
as Agent

 

 

 

 

By

/s/ Carrie Glick

 

 

Carrie Glick

 

 

Vice President

 

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

 

(Signature Page to Second Amended and Restated Credit and Guaranty Agreement)

 

LENDER:

BANK OF AMERICA, N.A.,

 

as a Lender

 

 

 

 

By

/s/ Nursultan Fidelbek Uulu

 

 

Authorized Signatory

 

 

 

 

 

Address for Notices:

 

 

 

214 North Tryon Street

 

Charlotte, North Carolina 28255

 

NC1-027-21-01

 

 

 

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EXHIBIT A

 

NOTICE OF PAYMENT REQUEST

 

 

[Date]

 

[Name of Lender]
[Address]

 

Attention:

 

Reference is made to the Second Amended and Restated Credit and Guaranty
Agreement, dated as of May 27, 2016, among MASTERCRAFT BOAT COMPANY, LLC, a
Delaware limited liability company (“MasterCraft”), MASTERCRAFT SERVICES, INC.,
a Tennessee corporation (“Services”), MCBC HYDRA BOATS, LLC, a Tennessee limited
liability company (“Hydra”), MASTERCRAFT INTERNATIONAL SALES
ADMINISTRATION, INC., a Delaware corporation (“Sales Administration”),
(collectively, “Borrowers” and, individually, each a “Borrower”), MCBC
HOLDINGS, INC., a Delaware corporation (“Holdings”), as a Guarantor, the Lenders
party thereto, and Fifth Third Bank, an Ohio banking corporation, as Agent (as
amended, restated, supplemented or otherwise modified from time to time, the
“Credit Agreement”).  Capitalized terms used herein and not defined herein have
the meanings assigned to them in the Credit Agreement.  [Borrower has failed to
pay its Reimbursement Obligation in the amount of $          .  Your Applicable
Percentage of the unpaid Reimbursement Obligation is $             ] or
[                           has been required to return a payment by Borrower of
a Reimbursement Obligation in the amount of $               .  Your Applicable
Percentage of the returned Reimbursement Obligation is $               .]

 

 

Very truly yours,

 

 

 

FIFTH THIRD BANK, as L/C Issuer

 

 

 

 

By

 

 

Name

 

 

Title

 

 

1

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EXHIBIT B

 

NOTICE OF BORROWING

 

 

Date:                   ,      

 

To:                             Fifth Third Bank, an Ohio banking corporation,
as Agent for the Lenders parties to the Second Amended and Restated Credit and
Guaranty Agreement dated as of May 27, 2016 (as extended, renewed, amended or
restated from time to time, the “Credit Agreement”), among MASTERCRAFT BOAT
COMPANY, LLC, a Delaware limited liability company (“MasterCraft”), MASTERCRAFT
SERVICES, INC., a Tennessee corporation (“Services”), MCBC HYDRA BOATS, LLC, a
Tennessee limited liability company (“Hydra”), MASTERCRAFT INTERNATIONAL SALES
ADMINISTRATION, INC., a Delaware corporation (“Sales Administration”),
(collectively, “Borrowers” and, individually, each a “Borrower”), MCBC
HOLDINGS, INC., a Delaware corporation (“Holdings”), as a Guarantor, certain
Lenders which are signatories thereto, and Fifth Third Bank, an Ohio banking
corporation, as Agent

 

Ladies and Gentlemen:

 

The undersigned Borrower Representative refers to the Credit Agreement, the
terms defined therein being used herein as therein defined, and hereby gives you
notice irrevocably, pursuant to Section 2.5 of the Credit Agreement, of
Borrowing specified below:

 

1.                                      The Business Day of the proposed
Borrowing is            ,     .

 

2.                                      The aggregate amount of the proposed
Borrowing is $              .

 

3.                                      Borrowing is being advanced under the
[Revolving] [Term] Credit.

 

4.                                      Borrowing is to be comprised of
$            of [Base Rate] [Eurodollar] Loans.

 

[5.                                  The duration of the Interest Period for the
Eurodollar Loans included in Borrowing shall be              months.]

 

The undersigned hereby certifies that the following statements are true on the
date hereof, and will be true on the date of the proposed Borrowing, before and
after giving effect thereto and to the application of the proceeds therefrom:

 

(a)                                 the representations and warranties of Credit
Parties contained in Section 5 of the Credit Agreement and in the other Loan
Documents are true and correct in all material respects (provided that if any
representation or warranty is by its terms qualified by concepts of materiality,
such representation and warranty is true and correct in all respects) as though
made on and as of the date hereof (except to the extent such representations and
warranties relate to an earlier date, in which case they are true and correct in
all material respects (provided that if any

 

1

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representation or warranty is by its terms qualified by concepts of materiality,
such representation and warranty is true and correct in all respects) as of such
earlier date); and

 

(b)                                 no Default or Event of Default has occurred
and is continuing or would result from such proposed Borrowing.

 

(c)                                  [with respect to any Revolving Loan
Borrowing, such Borrowing will not result in the aggregate Revolving Credit
Exposures of all Lenders exceeding the lesser of (x) the total Revolving Credit
Commitments, and (y) the Revolving Loan Limit, as determined based upon the most
recent Compliance Certificate, in each case minus the L/C Obligations.]

 

[with respect to the Borrowing of the Term Loan, all of the Credit Event
conditions set forth in Section 3.2 of the Credit Agreement are satisfied as of
the Term Loan Funding Date.]

 

 

 

 

MasterCraft Boat Company, LLC,

 

as Borrower Representative

 

 

 

 

By

 

 

Name

 

 

Title

 

 

2

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EXHIBIT C

 

NOTICE OF CONTINUATION/CONVERSION

 

 

Date:                 ,      

 

To:                             Fifth Third Bank, as Agent for the Lenders
parties to the Second Amended and Restated Credit and Guaranty Agreement dated
as of May 27, 2016 (as extended, renewed, amended or restated from time to time,
the “Credit Agreement”) among MASTERCRAFT BOAT COMPANY, LLC, a Delaware limited
liability company (“MasterCraft”), MASTERCRAFT SERVICES, INC., a Tennessee
corporation (“Services”), MCBC HYDRA BOATS, LLC, a Tennessee limited liability
company (“Hydra”), MASTERCRAFT INTERNATIONAL SALES ADMINISTRATION, INC., a
Delaware corporation (“Sales Administration”), (collectively, “Borrowers” and,
individually, each a “Borrower”), MCBC HOLDINGS, INC., a Delaware corporation
(“Holdings”), as a Guarantor, certain Lenders which are signatories thereto, and
Fifth Third Bank, as Agent

 

Ladies and Gentlemen:

 

The undersigned Borrower Representative refers to the Credit Agreement, the
terms defined therein being used herein as therein defined, and hereby gives you
notice irrevocably, pursuant to Section 2.5 of the Credit Agreement, of the
[conversion] [continuation] of the Loans specified herein, that:

 

1.                                      The conversion/continuation Date is
          ,     .

 

2.                                      The aggregate amount of the [Revolving]
[Term] Loans to be [converted] [continued] is $              .

 

3.                                      The Loans are to be [converted into]
[continued as] [Eurodollar] [Base Rate] Loans.

 

4.                                      [If applicable:]  The duration of the
Interest Period for the [Revolving] [Term] Loans included in the [conversion]
[continuation] shall be           months.

 

Borrower Representative hereby certifies that the following statements are true
on the date hereof, and will be true on the proposed conversion/continuation
date, before and after giving effect thereto and to the application of the
proceeds therefrom:

 

(a)                                 the representations and warranties of Credit
Parties contained in Section 5 of the Credit Agreement and in the other Loan
Documents are true and correct in all material respects (provided that if any
representation or warranty is by its terms qualified by concepts of materiality,
such representation and warranty is true and correct in all respects) as though
made on and as of the date hereof (except to the extent such representations and
warranties relate to an earlier date, in which case they are true and correct in
all material respects (provided that if any

 

1

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representation or warranty is by its terms qualified by concepts of materiality,
such representation and warranty is true and correct in all respects) as of such
earlier date); provided, however, that this condition shall not apply to the
conversion of an outstanding Eurodollar Loan to a Base Rate Loan; and

 

(b)                                 no Default or Event of Default has occurred
and is continuing, or would result from such proposed [conversion]
[continuation].

 

 

MasterCraft Boat Company, LLC,

 

as Borrower Representative

 

 

 

 

By

 

 

Name

 

 

Title

 

 

2

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

 

EXHIBIT D-1

 

TERM NOTE

 

$

,            

 

FOR VALUE RECEIVED, each of the undersigned, MASTERCRAFT BOAT COMPANY, LLC, a
Delaware limited liability company (“MasterCraft”), MASTERCRAFT SERVICES, INC.,
a Tennessee corporation (“Services”), MCBC HYDRA BOATS, LLC, a Tennessee limited
liability company (“Hydra”), MASTERCRAFT INTERNATIONAL SALES
ADMINISTRATION, INC., a Delaware corporation (“Sales Administration”),
(collectively, “Borrowers” and, individually, each a “Borrower”), MCBC
HOLDINGS, INC., a Delaware corporation (“Holdings”), as a Guarantor, hereby
jointly and severally promises to pay to                            (the
“Lender”) at the principal office of Fifth Third Bank, an Ohio banking
corporation, as administrative agent (in such capacity, together with its
successors or assigns, “Agent”), in Cincinnati, Ohio, in immediately available
funds, the principal sum of                     Dollars ($          ) or, if
less, the aggregate unpaid principal amount of the Term Loan made or maintained
by the Lender to Borrower pursuant to the Credit Agreement, in installments in
the amounts called for by Section 2.7 of the Credit Agreement, together with
interest on the principal amount of such Term Loan from time to time outstanding
hereunder at the rates, and payable in the manner and on the dates, specified in
the Credit Agreement.

 

This Term Note (this “Note”) is one of the Term Notes referred to in the Second
Amended and Restated Credit and Guaranty Agreement dated as of May 27, 2016
among Borrowers, the other Credit Parties party thereto from time to time, the
Agent and the Lenders party thereto (as amended, restated, supplemented or
otherwise modified from time to time, the “Credit Agreement”), and this Note and
the holder hereof are entitled to all the benefits and security provided for
thereby or referred to therein, to which Credit Agreement reference is hereby
made for a statement thereof.  All defined terms used in this Note, except terms
otherwise defined herein, shall have the same meaning as in the Credit
Agreement.  This Note shall be governed by and construed in accordance with the
internal laws (including, without limitation, 735 ILCS Section 105/5-1 et seq.,
but otherwise without regard to the conflict of laws provisions) of the State of
Illinois.

 

Voluntary prepayments may be made hereon, certain prepayments are required to be
made hereon, and this Note may be declared due prior to the expressed maturity
hereof, all in the events, on the terms and in the manner as provided for in the
Credit Agreement.

 

Each Borrower hereby waives demand, presentment, protest or notice of any kind
hereunder.  This Note is binding upon Borrowers and their respective successors
and assigns, and shall inure to the benefit of Lender and its successors and
assigns.  Borrowers and their successors and assigns shall be jointly and
severally obligated hereunder.

 

This Term Note is a registered obligation, transferable only upon notation in
the Register, and no assignment hereof shall be effective until recorded
therein.

 

1

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

 

 

[INSERT NAME OF BORROWER]

 

 

 

 

By

 

 

Name

 

 

Title

 

 

2

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

 

EXHIBIT D-2

 

REVOLVING NOTE

 

$

,            

 

FOR VALUE RECEIVED, each of the undersigned, MASTERCRAFT BOAT COMPANY, LLC, a
Delaware limited liability company (“MasterCraft”), MASTERCRAFT SERVICES, INC.,
a Tennessee corporation (“Services”), MCBC HYDRA BOATS, LLC, a Tennessee limited
liability company (“Hydra”), MASTERCRAFT INTERNATIONAL SALES
ADMINISTRATION, INC., a Delaware corporation (“Sales Administration”),
(collectively, “Borrowers” and, individually, each a “Borrower”), MCBC
HOLDINGS, INC., a Delaware corporation (“Holdings”), as a Guarantor, hereby
jointly and severally promises to pay to                              (the
“Lender”) on the Revolving Credit Termination Date of the hereinafter defined
Credit Agreement, at the principal office of Fifth Third Bank, an Ohio banking
corporation, as administrative agent (in such capacity, together with its
successors or assigns, the “Agent”), in Cincinnati, Ohio, in immediately
available funds, the principal sum of                     Dollars ($          )
or, if less, the aggregate unpaid principal amount of all Revolving Loans made
by the Lender to Borrowers pursuant to the Credit Agreement, together with
interest on the principal amount of each Revolving Loan from time to time
outstanding hereunder at the rates, and payable in the manner and on the dates,
specified in the Credit Agreement.

 

This Revolving Note (this “Note”) is one of the Revolving Notes referred to in
the Second Amended and Restated Credit and Guaranty Agreement dated as of
May 27, 2016 among Borrowers, the other Credit Parties party thereto from time
to time, Agent and the Lenders party thereto (as amended, restated, supplemented
or otherwise modified from time to time, the “Credit Agreement”), and this Note
and the holder hereof are entitled to all the benefits and security provided for
thereby or referred to therein, to which Credit Agreement reference is hereby
made for a statement thereof.  All defined terms used in this Note, except terms
otherwise defined herein, shall have the same meaning as in the Credit
Agreement.  This Note shall be governed by and construed in accordance with the
internal laws (including, without limitation, 735 ILCS Section 105/5-1 et seq.,
but otherwise without regard to the conflict of laws provisions) of the State of
Illinois.

 

Voluntary prepayments may be made hereon, certain prepayments are required to be
made hereon, and this Note may be declared due prior to the expressed maturity
hereof, all in the events, on the terms and in the manner as provided for in the
Credit Agreement.

 

Each Borrower hereby waives demand, presentment, protest or notice of any kind
hereunder.  This Note is binding upon Borrowers and their respective successors
and assigns, and shall inure to the benefit of Lender and its successors and
assigns.  Borrowers and their successors and assigns shall be jointly and
severally obligated hereunder.

 

1

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

 

This Revolving Note is a registered obligation, transferable only upon notation
in the Register, and no assignment hereof shall be effective until recorded
therein.

 

 

[INSERT NAME OF BORROWER]

 

 

 

 

By

 

 

Name

 

 

Title

 

 

2

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

 

EXHIBIT D-3

 

SWING NOTE

 

$10,000,000

,            

 

FOR VALUE RECEIVED, each of the undersigned, MASTERCRAFT BOAT COMPANY, LLC, a
Delaware limited liability company (“MasterCraft”), MASTERCRAFT SERVICES, INC.,
a Tennessee corporation (“Services”), MCBC HYDRA BOATS, LLC, a Tennessee limited
liability company (“Hydra”), MASTERCRAFT INTERNATIONAL SALES
ADMINISTRATION, INC., a Delaware corporation (“Sales Administration”),
(collectively, “Borrowers” and, individually, each a “Borrower”), MCBC
HOLDINGS, INC., a Delaware corporation (“Holdings”), as a Guarantor, hereby
jointly and severally promises to pay to FIFTH THIRD BANK, an Ohio banking
corporation, as the Swing Line Lender (the “Lender”), on the Revolving Credit
Termination Date of the hereinafter defined Credit Agreement, at the principal
office of Fifth Third Bank, an Ohio banking corporation, as administrative agent
(in such capacity, together with its successors or assigns, the “Agent”), in
Cincinnati, Ohio, in immediately available funds, the principal sum of Ten
Million Dollars ($10,000,000.00) or, if less, the aggregate unpaid principal
amount of all Swing Loans made by the Lender to Borrowers pursuant to the Credit
Agreement, together with interest on the principal amount of each Swing Loan
from time to time outstanding hereunder at the rates, and payable in the manner
and on the dates, specified in the Credit Agreement.

 

This Swing Note (this “Note”) is the Swing Note referred to in the Amended and
Second Restated Credit and Guaranty Agreement dated as of May 27, 2016 among
Borrowers, the other Credit Parties party thereto from time to time, the Agent
and the Lenders party thereto, (as amended, restated, supplemented or otherwise
modified from time to time, the “Credit Agreement”), and this Note and the
holder hereof are entitled to all the benefits and security provided for thereby
or referred to therein, to which Credit Agreement reference is hereby made for a
statement thereof.  All defined terms used in this Note, except terms otherwise
defined herein, shall have the same meaning as in the Credit Agreement.  This
Note shall be governed by and construed in accordance with the internal laws
(including, without limitation, 735 ILCS Section 105/5-1 et seq., but otherwise
without regard to the conflict of laws provisions) of the State of Illinois.

 

Voluntary prepayments may be made hereon, certain prepayments are required to be
made hereon, and this Note may be declared due prior to the expressed maturity
hereof, all in the events, on the terms and in the manner as provided for in the
Credit Agreement.

 

Each Borrower hereby waives demand, presentment, protest or notice of any kind
hereunder.  This Note is binding upon Borrowers and their respective successors
and assigns, and shall inure to the benefit of Lender and its successors and
assigns.  Borrowers and their successors and assigns shall be jointly and
severally obligated hereunder.

 

1

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

 

This Swing Note is a registered obligation, transferable only upon notation in
the Register, and no assignment hereof shall be effective until recorded
therein.

 

 

[INSERT NAME OF BORROWER]

 

 

 

 

By

 

 

Name

 

 

Title

 

 

2

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

 

EXHIBIT E

 

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

 

COMPLIANCE CERTIFICATE

 

To:                             Fifth Third Bank, as Agent under, and the
Lenders party to, the Credit Agreement described below

 

This Compliance Certificate is furnished to the Agent and the Lenders pursuant
to that certain Second Amended and Restated Credit and Guaranty Agreement dated
as of May 27, 2016 (as amended, restated, supplemented or otherwise modified
from time to time, the “Credit Agreement”).  Unless otherwise defined herein,
the terms used in this Compliance Certificate have the meanings ascribed thereto
in the Credit Agreement.

 

The Undersigned hereby certifies, solely in his/her capacity as an officer of
Borrower Representative, and not individually that:

 

1.                                      I am the duly elected              of
the undersigned Borrower Representative;

 

2.                                      I have reviewed the terms of the Credit
Agreement and I have made, or have caused to be made under my supervision, a
detailed review of the transactions and conditions of the Credit Parties and
their Subsidiaries during the accounting period covered by the attached
financial statements;

 

3.                                      The examinations described in paragraph
2 did not disclose, and I have no knowledge of, the existence of any condition
or the occurrence of any event which constitutes an Event of Default during or
at the end of the accounting period covered by the attached financial statements
or as of the date of this Compliance Certificate, except as set forth below;

 

4.                                      The financial statements required by
Section 6.1 of the Credit Agreement and being furnished to you concurrently with
this Compliance Certificate are true, correct and complete in all material
respects as of the date and for the periods covered thereby;

 

5.                                      The representations and warranties of
Borrower contained in Section 5 of the Credit Agreement and in the other Loan
Documents are true and correct in all material respects (provided that if any
representation or warranty is by its terms qualified by concepts of materiality,
such representation and warranty is true and correct in all respects) as though
made on and as of the date hereof (except to the extent such representations and
warranties relate to an earlier date, in which case they are true and correct in
all material respects (provided that if any representation or warranty is by its
terms qualified by concepts of materiality, such representation and warranty is
true and correct in all respects) as of such earlier date);

 

1

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

 

6.                                      The Schedule I hereto sets forth
financial data and computations evidencing Borrower’s compliance with certain
covenants of the Credit Agreement, all of which data and computations are, to
the best of my knowledge, true, complete and correct and have been made in
accordance with the relevant Sections of the Credit Agreement; and

 

7.                                      The Schedule II hereto sets forth a
comparison of current financials against the budget for such period as required
by Sections 6.1(d) and (e) of the Credit Agreement.

 

Described below are the exceptions, if any, to paragraph 3 by listing, in
detail, the nature of the condition or event, the period during which it has
existed and the action which the Credit parties have taken, is taking, or
proposes to take with respect to each such condition or event:

 

 

The foregoing certifications, together with the computations set forth in
Schedule I and Schedule II hereto and the financial statements delivered with
this Certificate in support hereof, are made and delivered this        day of
                  , 20   .  Under no circumstances shall the undersigned officer
of Borrower Representative have any personal liability hereunder.

 

 

 

MASTERCRAFT BOAT COMPANY,

LLC, a Delaware limited liability company,

 

as Borrower Representative

 

 

 

 

By

 

 

Name

 

 

Title

 

 

2

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

 

SCHEDULE I

 

TO COMPLIANCE CERTIFICATE

 

MasterCraft Boat Company, LLC

 

Compliance Calculations

 

for Second Amended and Restated Credit and Guaranty
Agreement dated as of May 27, 2016

 

Calculations as of              ,

 

A.

Total Leverage Ratio (Section 6.22(a))

 

 

 

 

[see attached calculations]

 

 

 

-

Total Leverage Ratio:

 

      to 1.0

 

-

The Credit Parties are in compliance (circle yes or no)

 

yes/no

 

-

The change in Total Leverage Ratio requires an interest rate adjustment per
definition of Applicable Margin (Pricing Grid)

 

yes/no

 

 

 

 

B.

Fixed Charge Coverage Ratio (Section 6.22(b))

 

 

 

 

[see attached calculations]

 

 

 

-

Fixed Charge Coverage Ratio:

 

      to 1.0

 

-

The Credit Parties are in compliance (with requirement of 1.15 to 1.0) (circle
yes or no)

 

yes/no

 

 

 

 

C.

Capital Expenditures (Section 6.22(c))

 

 

 

 

 

 

 

-

Capital Expenditures

 

$          

 

-

Capital Expenditures must be less than

 

$7,500,000

 

-

The Credit Parties are in compliance (circle yes or no)

 

yes/no

 

1

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

 

EXHIBIT F

 

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
[the][each](1) Assignor identified in item 1 below ([the][each, an] “Assignor”)
and [the][each](2) Assignee identified in item 2 below ([the][each, an]
“Assignee”).  [It is understood and agreed that the rights and obligations of
[the Assignors][the Assignees](3) hereunder are several and not joint.](4) 
Capitalized terms used but not defined herein shall have the meanings given to
them in the Credit Agreement identified below (as amended, the “Credit
Agreement”), receipt of a copy of which is hereby acknowledged by [the][each]
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][each] Assignor hereby irrevocably sells and
assigns to [the Assignee][the respective Assignees], and [the][each] Assignee
hereby irrevocably purchases and assumes from [the Assignor][the respective
Assignors], subject to and in accordance with the Standard Terms and Conditions
and the Credit Agreement, as of the Effective Date inserted by the Agent as
contemplated below (i) all of [the Assignor’s][the respective Assignors’] rights
and obligations in [its capacity as a Lender][their respective capacities as
Lenders] 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][the respective Assignors] under the respective facilities
identified below (including without limitation any letters of credit,
guarantees, and Swing 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)][the
respective Assignors (in their respective capacities as Lenders)] 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, but not limited to, 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 by [the][any]
Assignor to [the][any] Assignee pursuant to clauses (i) and (ii) above being
referred to herein collectively as [the][an] “Assigned Interest”).  Each such
sale and assignment is without recourse to [the][any] Assignor and, except as
expressly provided in this Assignment and Assumption, without representation or
warranty by [the][any] Assignor.

 

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

(1)  For bracketed language here and elsewhere in this form relating to the
Assignor(s), if the assignment is from a single Assignor, choose the first
bracketed language.  If the assignment is from multiple Assignors, choose the
second bracketed language.

(2)  For bracketed language here and elsewhere in this form relating to the
Assignee(s), if the assignment is to a single Assignee, choose the first
bracketed language.  If the assignment is to multiple Assignees, choose the
second bracketed language.

(3)  Select as appropriate.

(4)  Include bracketed language if there are either multiple Assignors or
multiple Assignees.

 

1

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

 

1.

 

Assignor[s]:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

[Assignor [is] [is not] a Defaulting Lender]

2.

 

Assignee[s]:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

[for each Assignee, indicate [Affiliate][Approved Fund] of [identify Lender]

3.

 

Borrower(s):

 

 

 

 

 

 

 

4.

 

Agent:

 

                      , as the Agent under the Credit Agreement

 

 

 

 

 

5.

 

Credit Agreement:

 

The Second Amended and Restated Credit and Guaranty Agreement, dated as of
May 27, 2016 among MasterCraft Boat Company, LLC and the other Credit Parties
named therein, the Lenders parties thereto, and Fifth Third Bank, as Agent

 

 

 

 

 

6.

 

Assigned Interest[s]:

 

 

 

Assignor[s](5)

 

Assignee[s](6)

 

Facility
Assigned(7)

 

Aggregate Amount of
Commitment/Loans
for all Lenders(8)

 

Amount of
Commitment/Loans
Assigned(8)

 

Percentage
Assigned of
Commitment/
Loans(9)

 

CUSIP
Number

 

 

 

 

 

 

 

$

 

 

$

 

 

 

%

 

 

 

 

 

 

 

 

$

 

 

$

 

 

 

%

 

 

 

 

 

 

 

 

$

 

 

$

 

 

 

%

 

 

 

7.

 

Trade Date:

 

              ](10)

 

[Page break]

 

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

(5)  List each Assignor, as appropriate.

(6)  List each Assignee, as appropriate.

(7)  Fill in the appropriate terminology for the types of facilities under the
Credit Agreement that are being assigned under this Assignment (e.g., “Revolving
Credit Commitment,” “Term Loan Commitment,” etc.)

(8)  Amount to be adjusted by the counterparties to take into account any
payments or prepayments made between the Trade Date and the Effective Date.

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

(10)  To be completed if the Assignor(s) and the Assignee(s) intend that the
minimum assignment amount is to be determined as of the Trade Date.

 

2

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

 

Effective Date:                   , 20    [TO BE INSERTED BY AGENT AND WHICH
SHALL BE THE EFFECTIVE DATE OF RECORDATION OF TRANSFER IN THE REGISTER
THEREFOR.]

 

The terms set forth in this Assignment and Assumption are hereby agreed to:

 

 

ASSIGNOR[S](11)

 

 

 

[NAME OF ASSIGNOR]

 

 

 

 

 

 

By:

 

 

 

Title:

 

 

 

[NAME OF ASSIGNOR]

 

 

 

 

 

 

By:

 

 

 

Title:

 

 

 

 

ASSIGNEE[S](12)

 

 

 

[NAME OF ASSIGNEE]

 

 

 

 

 

 

By:

 

 

 

Title:

 

 

 

[NAME OF ASSIGNEE]

 

 

 

 

 

 

By:

 

 

 

Title:

 

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

(11)  Add additional signature blocks as needed.  Include both Fund/Pension Plan
and manager making the trade (if applicable).

(12)  Add additional signature blocks as needed.  Include both Fund/Pension Pl
an and manager making the trade (if applicable).

 

3

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

 

[Consented to and](13) Accepted:

 

 

 

Fifth Third Bank, as Agent

 

 

 

 

 

 

By:

 

 

 

 

Title:

 

 

 

[Consented to:](14)

 

 

 

[NAME OF RELEVANT PARTY]

 

 

 

 

 

 

By:

 

 

 

 

Title:

 

 

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

(13)  To be added only if the consent of the Administrative Agent is required by
the terms of the Credit Agreement.

(14)  To be added only if the consent of Borrower and/or other parties (e.g.
Swing Line Lender, L/C Issuer) is required by the terms of the Credit Agreement.

 

4

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

 

[                  ](15)

 

ANNEX 1

 

Standard Terms and Conditions for
Assignment and Assumption

 

1.                                      Representations and Warranties.

 

1.1                               Assignor[s].  [The][Each] Assignor
(a) represents and warrants that (i) it is the legal and beneficial owner of
[the][the relevant] Assigned Interest, (ii) [the][such] Assigned Interest is
free and clear of any lien, encumbrance or other adverse claim, (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 (iv) it is [not] a Defaulting Lender; 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(16), (ii) the execution, legality, validity, enforceability,
genuineness, sufficiency or value of the Loan Documents or any collateral
thereunder, (iii) the financial condition of any Credit Party, any of its
Subsidiaries or Affiliates or any other Person obligated in respect of any Loan
Document, or (iv) the performance or observance by any Credit Party, any of its
Subsidiaries or Affiliates or any other Person of any of their respective
obligations under any Loan Document.

 

1.2.                            Assignee[s].  [The][Each] 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 meets all the requirements to be an
assignee under Section   (b)(iii), (v) and (vi) of the Credit Agreement (subject
to such consents, if any, as may be required under Section   (b)(iii) of the
Credit Agreement), (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][the relevant] Assigned Interest, shall have the obligations of a Lender
thereunder, (iv) it is sophisticated with respect to decisions to acquire assets
of the type represented by the Assigned Interest and either it, or the Person
exercising discretion in making its decision to acquire the Assigned Interest,
is experienced in acquiring assets of such type, (v) it has received a copy of
the Credit Agreement, and has received or has been accorded the opportunity to
receive copies of the most recent financial statements delivered pursuant to
Section     thereof, as applicable, and such other documents and information as
it deems appropriate to make its own credit analysis and decision to enter into
this Assignment and Assumption and to purchase [the][such] Assigned Interest,
(vi) it has, independently and without reliance upon the Agent or any other
Lender and based on such documents and information as it has deemed appropriate,
made its own credit analysis and decision to enter into this Assignment and
Assumption and to purchase [the][such] Assigned Interest, and (vii) [if it is a
Foreign

 

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

(15)  Describe Credit Agreement at option of Administrative Agent.

(16)  The term “Loan Document” should be conformed to that used in the Credit
Agreement.

 

1

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

 

Lender](17) attached to the Assignment and Assumption is any documentation
required to be delivered by it pursuant to the terms of the Credit Agreement,
duly completed and executed by [the][such] Assignee; and (b) agrees that (i) it
will, independently and without reliance on the Agent, [the][any] Assignor or
any other Lender, and based on such documents and information as it shall deem
appropriate at the time, continue to make its own credit decisions in taking or
not taking action under the Loan Documents, and (ii) it will perform in
accordance with their terms all of the obligations which by the terms of the
Loan Documents are required to be performed by it as a Lender.

 

2.                                      Payments.  From and after the Effective
Date, the Agent shall make all payments in respect of [the][each] Assigned
Interest (including payments of principal, interest, fees and other amounts) to
[the][the relevant] Assignor for amounts which have accrued to but excluding the
Effective Date and to [the][the relevant] Assignee for amounts which have
accrued from and after the Effective Date.(18)  Notwithstanding the foregoing,
the Agent shall make all payments of interest, fees or other amounts paid or
payable in kind from and after the Effective Date to [the][the relevant]
Assignee.

 

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 internal laws of the State of Illinois.

 

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

(17)  The concept of “Foreign Lender” should be conformed to the section in the
Credit Agreement governing withholding taxes and gross-up.  If Borrower is a
U.S. Borrower, the bracketed language should be deleted.

(18)  The Administrative Agent should consider whether this method conforms to
its systems.  In some circumstances, the following alternative language may be
appropriate:

“From and after the Effective Date, the Administrative Agent shall make all
payments in respect of [the][each] Assigned Interest (including payments of
principal, interest, fees and other amounts) to [the][the relevant] Assignee
whether such amounts have accrued prior to, on or after the Effective Date.  The
Assignor[s] and the Assignee[s] shall make all appropriate adjustments in
payments by the Administrative Agent for periods prior to the Effective Date or
with respect to the making of this assignment directly between themselves.”

 

2

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

 

EXHIBIT G

 

JOINDER AGREEMENT

 

THIS JOINDER AGREEMENT (this “Agreement”), dated as of           ,     , 200 ,
is entered into between                                 , a                  
(the “New Subsidiary”) and FIFTH THIRD BANK, an Ohio banking corporation, as
Agent under that certain Second Amended and Restated Credit and Guaranty
Agreement, dated as of May 27, 2016 among MasterCraft Boat Company, LLC, a
Delaware limited liability company, the other Credit Parties named therein, the
Lenders party thereto and the Agent (as may be amended, restated, supplemented
or otherwise modified from time to time, the “Credit Agreement”).  All
capitalized terms used herein and not otherwise defined shall have the meanings
set forth in the Credit Agreement.

 

The New Subsidiary and the Agent, for the benefit of Agent and the Lenders,
hereby agree as follows:

 

1.                                      The New Subsidiary hereby acknowledges,
agrees and confirms that, by its execution of this Agreement, the New Subsidiary
will be deemed to be a [if required by Agent: Borrower and] Credit Party for all
purposes of the Credit Agreement and shall have all of the obligations of a
[Borrower and] Credit Party thereunder as if it had been an original signatory
to the Credit Agreement.  The New Subsidiary hereby ratifies, as of the date
hereof, and agrees to be bound by, all of the terms, provisions and conditions
contained in the Credit Agreement, including without limitation (a) all of the
representations and warranties of the Credit Parties set forth in Section 5 of
the Credit Agreement, (b) all of the covenants set forth in Section 6 of the
Credit Agreement and (c) all of the guaranty and other obligations set forth in
Section 11 of the Credit Agreement.  In furtherance of, and without limiting the
foregoing, the New Subsidiary, subject to the limitations set forth in
Section 11.9 of the Credit Agreement, hereby guarantees, jointly and severally
with the other Guarantors, to the Agent and the Lenders, as provided in
Section 11 of the Credit Agreement, the prompt payment and performance of the
Guaranteed Obligations in full when due (whether at stated maturity, as a
mandatory prepayment, by acceleration or otherwise) strictly in accordance with
the terms thereof and agrees that if any of the Guarantied Obligations are not
paid or performed in full when due (whether at stated maturity, as a mandatory
prepayment, by acceleration or otherwise), the New Subsidiary will, jointly and
severally together with the other Guarantors, promptly pay and perform the same,
without any demand or notice whatsoever, and that in the case of any extension
of time of payment or renewal of any of the Guarantied Obligations, the same
will be promptly paid in full when due (whether at extended maturity, as a
mandatory prepayment, by acceleration or otherwise) in accordance with the terms
of such extension or renewal.

 

2.                                      The New Subsidiary is, simultaneously
with the execution of this Agreement, executing and delivering the Joinder
Agreement to the Security Agreement and such Collateral Documents (and such
other documents and instruments) as requested by the Agent in accordance with
the Credit Agreement.

 

1

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3.                                      The address of the New Subsidiary for
purposes of Section 10.8 of the Credit Agreement is as follows:

 

 

4.                                      The New Subsidiary hereby waives
acceptance by the Agent and the Lenders of the guaranty by the New Subsidiary
upon the execution of this Agreement by the New Subsidiary.

 

5.                                      This Agreement may be executed in any
number of counterparts, each of which when so executed and delivered shall be an
original, but all of which shall constitute one and the same instrument. 
Signature by telecopy or other electronic transmission shall bind the parties
hereto.

 

6.                                      This Agreement and the other Loan
Documents (other than those containing an express choice-of-law provision), and
the rights and duties of the parties hereto, shall be governed and construed in
accordance with the internal laws (including, without limitation, 735 ILCS
Section 105/5-1 et seq., but otherwise without regard to the conflict of laws
provisions) of the State of Illinois.

 

IN WITNESS WHEREOF, the New Subsidiary has caused this Agreement to be duly
executed by its authorized officer, and the Agent, for the benefit of the
Lenders, has caused the same to be accepted by its authorized officer, as of the
day and year first above written.

 

 

[NEW SUBSIDIARY]

 

 

 

 

 

By:

 

 

Name:

 

 

Title:

 

 

 

 

Acknowledged and accepted:

 

 

 

FIFTH THIRD BANK, as Agent

 

 

 

 

 

By:

 

 

Name:

 

 

Title:

 

 

2

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EXHIBIT H-1

 

[Form of]

 

U.S. Tax Compliance Certificate
(For Foreign Lenders That Are Not Partnerships For U.S. Federal Income Tax
Purposes)

 

Reference is hereby made to the Second Amended and Restated Credit and Guaranty
Agreement dated as of May 27, 2016 (as amended, supplemented or otherwise
modified from time to time, the “Credit Agreement”), among Mastercraft Boat
Company, LLC et. al. as Credit Parties, and each lender from time to time party
thereto.

 

Pursuant to the provisions of Section 8.5 of the Credit Agreement, the
undersigned hereby certifies that (i) it is the sole record and beneficial owner
of the Loan(s) (as well as any Note(s) evidencing such Loan(s)) in respect of
which it is providing this certificate, (ii) it is not a bank within the meaning
of Section 881(c)(3)(A) of the Code, (iii) it is not a ten percent shareholder
of Borrower within the meaning of Section 871(h)(3)(B) of the Code and (iv) it
is not a controlled foreign corporation related to Borrower as described in
Section 881(c)(3)(C) of the Code.

 

The undersigned has furnished the Agent and Borrower with a certificate of its
non-U.S. Person status on IRS Form W-8BEN or W-8BEN-E.  By executing this
certificate, the undersigned agrees that (1) if the information provided on this
certificate changes, the undersigned shall promptly so inform Borrower, Borrower
Representative and the Agent, and (2) the undersigned shall have at all times
furnished Borrower and the Agent with a properly completed and currently
effective certificate in either the calendar year in which each payment is to be
made to the undersigned, or in either of the two calendar years preceding such
payments.

 

Unless otherwise defined herein, terms defined in the Credit Agreement and used
herein shall have the meanings given to them in the Credit Agreement.

 

 

[NAME OF LENDER]

 

 

 

 

 

 

 

By:

 

 

 

Name:

 

 

Title:

 

 

 

 

 

 

Dated:                 , 20[  ]

 

 

 

1

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EXHIBIT H-2

 

[Form of]

 

U.S. Tax Compliance Certificate
(For Foreign Participants That Are Not Partnerships For U.S. Federal Income Tax
Purposes)

 

Reference is hereby made to the Second Amended and Restated Credit and Guaranty
Agreement dated as of May 27, 2016 (as amended, supplemented or otherwise
modified from time to time, the “Credit Agreement”), among Mastercraft Boat
Company, LLC et. al. as Credit Parties, and each lender from time to time party
thereto.

 

Pursuant to the provisions of Section 8.5 of the Credit Agreement, the
undersigned hereby certifies that (i) it is the sole record and beneficial owner
of the participation in respect of which it is providing this certificate,
(ii) it is not a bank within the meaning of Section 881(c)(3)(A) of the Code,
(iii) it is not a ten percent shareholder of Borrower within the meaning of
Section 871(h)(3)(B) of the Code, and (iv) it is not a controlled foreign
corporation related to Borrower as described in Section 881(c)(3)(C) of the
Code.

 

The undersigned has furnished its participating Lender with a certificate of its
non-U.S. Person status on IRS Form W-8BEN or W-8BEN-E.  By executing this
certificate, the undersigned agrees that (1) if the information provided on this
certificate changes, the undersigned shall promptly so inform such Lender in
writing, and (2) the undersigned shall have at all times furnished such Lender
with a properly completed and currently effective certificate in either the
calendar year in which each payment is to be made to the undersigned, or in
either of the two calendar years preceding such payments.

 

Unless otherwise defined herein, terms defined in the Credit Agreement and used
herein shall have the meanings given to them in the Credit Agreement.

 

 

[NAME OF PARTICIPANT]

 

 

 

 

 

 

 

By:

 

 

 

Name:

 

 

Title:

 

 

 

 

 

 

Dated:                 , 20[  ]

 

 

 

1

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EXHIBIT H-3

 

[Form of]

 

U.S. Tax Compliance Certificate
(For Foreign Participants That Are Partnerships For U.S. Federal Income Tax
Purposes)

 

Reference is hereby made to the Amended and Restated Credit and Guaranty
Agreement dated as of May 27, 2016 (as amended, supplemented or otherwise
modified from time to time, the “Credit Agreement”), among Mastercraft Boat
Company, LLC et. al. as Credit Parties, and each lender from time to time party
thereto.

 

Pursuant to the provisions of Section 8.5 of the Credit Agreement, the
undersigned hereby certifies that (i) it is the sole record owner of the
participation in respect of which it is providing this certificate, (ii) its
direct or indirect partners/members are the sole beneficial owners of such
participation, (iii) with respect such participation, neither the undersigned
nor any of its direct or indirect partners/members is a bank extending credit
pursuant to a loan agreement entered into in the ordinary course of its trade or
business within the meaning of Section 881(c)(3)(A) of the Code, (iv) none of
its direct or indirect partners/members is a ten percent shareholder of Borrower
within the meaning of Section 871(h)(3)(B) of the Code and (v) none of its
direct or indirect partners/members is a controlled foreign corporation related
to Borrower as described in Section 881(c)(3)(C) of the Code.

 

The undersigned has furnished its participating Lender with IRS Form W-8IMY
accompanied by one of the following forms from each of its partners/members that
is claiming the portfolio interest exemption:  (i) an IRS Form W-8BEN or
W-8BEN-E or (ii) an IRS Form W-8IMY accompanied by an IRS Form W-8BEN or
W-8BEN-E from each of such partner’s/member’s beneficial owners that is claiming
the portfolio interest exemption.  By executing this certificate, the
undersigned agrees that (1) if the information provided on this certificate
changes, the undersigned shall promptly so inform such Lender and (2) the
undersigned shall have at all times furnished such Lender with a properly
completed and currently effective certificate in either the calendar year in
which each payment is to be made to the undersigned, or in either of the two
calendar years preceding such payments.

 

Unless otherwise defined herein, terms defined in the Credit Agreement and used
herein shall have the meanings given to them in the Credit Agreement.

 

 

[NAME OF PARTICIPANT]

 

 

 

 

 

 

 

By:

 

 

 

Name:

 

 

Title:

 

 

 

 

 

 

Dated:                 , 20[  ]

 

 

 

1

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EXHIBIT H-4

 

[Form of]

 

U.S. Tax Compliance Certificate
(For Foreign Lenders That Are Partnerships For U.S. Federal Income Tax Purposes)

 

Reference is hereby made to the Second Amended and Restated Credit and Guaranty
Agreement dated as of May 27, 2016 (as amended, supplemented or otherwise
modified from time to time, the “Credit Agreement”), among Mastercraft Boat
Company, LLC et. al. as Credit Parties, and each lender from time to time party
thereto.

 

Pursuant to the provisions of Section 8.5 of the Credit Agreement, the
undersigned hereby certifies that (i) it is the sole record owner of the
Loan(s) (as well as any Note(s) evidencing such Loan(s)) in respect of which it
is providing this certificate, (ii) its direct or indirect partners/members are
the sole beneficial owners of such Loan(s) (as well as any Note(s) evidencing
such Loan(s)), (iii) with respect to the extension of credit pursuant to this
Credit Agreement or any other Loan Document, neither the undersigned nor any of
its direct or indirect partners/members is a bank extending credit pursuant to a
loan agreement entered into in the ordinary course of its trade or business
within the meaning of Section 881(c)(3)(A) of the Code, (iv) none of its direct
or indirect partners/members is a ten percent shareholder of Borrower within the
meaning of Section 871(h)(3)(B) of the Code and (v) none of its direct or
indirect partners/members is a controlled foreign corporation related to
Borrower as described in Section 881(c)(3)(C) of the Code.

 

The undersigned has furnished the Agent and Borrower with IRS Form W-8IMY
accompanied by one of the following forms from each of its partners/members that
is claiming the portfolio interest exemption:  (i) an IRS Form W-8BEN or
W-8BEN-Eor (ii) an IRS Form W-8IMY accompanied by an IRS Form W-8BEN or W-8BEN-E
from each of such partner’s/member’s beneficial owners that is claiming the
portfolio interest exemption.  By executing this certificate, the undersigned
agrees that (1) if the information provided on this certificate changes, the
undersigned shall promptly so inform Borrower, Borrower Representative and the
Agent, and (2) the undersigned shall have at all times furnished Borrower and
the Agent with a properly completed and currently effective certificate in
either the calendar year in which each payment is to be made to the undersigned,
or in either of the two calendar years preceding such payments.

 

Unless otherwise defined herein, terms defined in the Credit Agreement and used
herein shall have the meanings given to them in the Credit Agreement.

 

 

[NAME OF LENDER]

 

 

 

 

 

 

 

By:

 

 

 

Name:

 

 

Title:

 

 

 

 

 

 

Dated:                 , 20[  ]

 

 

 

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Schedule 1

 

Commitments

 

MASTERCRAFT

 

Lender

 

Revolving
Loan
Commitment

 

Term Loan
Commitment

 

Total

 

Percentage

 

Fifth Third Bank

 

$

16,900,000.00

 

$

28,100,000.00

 

$

45,000,000.00

 

56.25

%

 

 

 

 

 

 

 

 

 

 

Bank of America

 

$

13,100,000.00

 

$

21,900,000.00

 

$

35,000,000.00

 

43.75

%

 

 

 

 

 

 

 

 

 

 

Total

 

$

30,000,000.00

 

$

50,000,000.00

 

$

80,000,000.00

 

100.00

%

 

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