EXECUTION COPY

Published CUSIP Number: 39060PAD1

Revolving Credit CUSIP Number: 39060PAE9

 

 

$175,000,000

CREDIT AGREEMENT

dated as of June 4, 2012

by and among

GREAT LAKES DREDGE & DOCK CORPORATION,

as Borrower,

THE OTHER CREDIT PARTIES HERETO,

as Credit Parties,

THE LENDERS REFERRED TO HEREIN,

as Lenders,

WELLS FARGO BANK, NATIONAL ASSOCIATION,

as Administrative Agent, Swingline Lender and an Issuing Lender,

BANK OF AMERICA, N.A.,

as Syndication Agent

and

PNC BANK, NATIONAL ASSOCIATION, BMO HARRIS BANK N.A. AND FIFTH THIRD BANK,

as Co-Documentation Agents

WELLS FARGO SECURITIES, LLC,

as Sole Lead Arranger and Sole Bookrunner

 

 

 

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TABLE OF CONTENTS

 

     Page  

ARTICLE I DEFINITIONS

     1   

SECTION 1.1 Definitions

     1   

SECTION 1.2 Other Definitions and Provisions

     36   

SECTION 1.3 Accounting Terms

     36   

SECTION 1.4 UCC Terms

     36   

SECTION 1.5 Rounding

     36   

SECTION 1.6 References to Agreement and Laws

     37   

SECTION 1.7 Times of Day

     37   

SECTION 1.8 Letter of Credit Amounts

     37   

SECTION 1.9 Guaranty Obligations

     37   

SECTION 1.10 Covenant Compliance Generally

     37   

ARTICLE II REVOLVING CREDIT FACILITY

     37   

SECTION 2.1 Revolving Credit Loans

     37   

SECTION 2.2 Swingline Loans

     38   

SECTION 2.3 Procedure for Advances of Revolving Credit Loans and Swingline Loans

     39   

SECTION 2.4 Repayment and Prepayment of Revolving Credit Loans and Swingline
Loans

     40   

SECTION 2.5 Permanent Reduction of the Aggregate Commitment

     42   

SECTION 2.6 Termination of Revolving Credit Facility

     42   

ARTICLE III LETTER OF CREDIT FACILITY

     43   

SECTION 3.1 L/C Commitment

     43   

SECTION 3.2 Procedure for Issuance of Letters of Credit

     44   

SECTION 3.3 Commissions and Other Charges

     44   

SECTION 3.4 L/C Participations

     45   

SECTION 3.5 Reimbursement Obligation of the Borrower

     46   

SECTION 3.6 Obligations Absolute

     46   

SECTION 3.7 Effect of Letter of Credit Application

     47   

ARTICLE IV COLLATERAL

     47   

SECTION 4.1 Perfection Trigger Event

     47   

SECTION 4.2 Substitution of Collateral

     48   

SECTION 4.3 Release of Collateral

     48   

SECTION 4.4 Escrow Agent

     50   

SECTION 4.5 Appraisals

     50   

SECTION 4.6 Further Assurances

     50   

SECTION 4.7 Collateral Covenants

     51   

ARTICLE V GENERAL LOAN PROVISIONS

     52   

SECTION 5.1 Interest

     52   

SECTION 5.2 Notice and Manner of Conversion or Continuation of Loans

     54   

SECTION 5.3 Fees

     55   

 

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SECTION 5.4 Manner of Payment

     55   

SECTION 5.5 Evidence of Indebtedness

     56   

SECTION 5.6 Adjustments

     56   

SECTION 5.7 Obligations of Lenders

     57   

SECTION 5.8 Changed Circumstances

     58   

SECTION 5.9 Indemnity

     59   

SECTION 5.10 Increased Costs

     59   

SECTION 5.11 Taxes

     61   

SECTION 5.12 Mitigation Obligations; Replacement of Lenders

     65   

SECTION 5.13 Incremental Loans

     66   

SECTION 5.14 Cash Collateral

     68   

SECTION 5.15 Defaulting Lenders

     69   

ARTICLE VI CONDITIONS OF CLOSING AND BORROWING

     72   

SECTION 6.1 Conditions to Closing and Initial Extensions of Credit

     72   

SECTION 6.2 Conditions to All Extensions of Credit

     76   

ARTICLE VII REPRESENTATIONS AND WARRANTIES OF THE CREDIT PARTIES

     77   

SECTION 7.1 Organization; Power; Qualification

     77   

SECTION 7.2 Ownership

     77   

SECTION 7.3 Authorization; Enforceability

     78   

SECTION 7.4 Compliance of Agreement, Loan Documents and Extensions of Credit
with Laws, Etc

     78   

SECTION 7.5 Compliance with Law; Governmental Approvals

     78   

SECTION 7.6 Tax Returns and Payments

     79   

SECTION 7.7 Intellectual Property Matters

     79   

SECTION 7.8 Environmental Matters

     79   

SECTION 7.9 Employee Benefit Matters

     80   

SECTION 7.10 Margin Stock

     81   

SECTION 7.11 Government Regulation

     81   

SECTION 7.12 Security Documents

     81   

SECTION 7.13 Insurance

     82   

SECTION 7.14 Burdensome Provisions

     82   

SECTION 7.15 Financial Statements

     82   

SECTION 7.16 No Material Adverse Change

     82   

SECTION 7.17 Solvency

     82   

SECTION 7.18 Titles to Properties; Liens

     83   

SECTION 7.19 Litigation

     83   

SECTION 7.20 OFAC

     83   

SECTION 7.21 Absence of Defaults

     83   

SECTION 7.22 Disclosure

     83   

ARTICLE VIII AFFIRMATIVE COVENANTS

     84   

SECTION 8.1 Financial Statements and Budgets

     84   

SECTION 8.2 Certificates; Other Reports

     85   

SECTION 8.3 Notice of Litigation and Other Matters

     88   

SECTION 8.4 Preservation of Corporate Existence and Related Matters

     89   

 

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SECTION 8.5 Maintenance of Property and Licenses

     89   

SECTION 8.6 Insurance

     89   

SECTION 8.7 Accounting Methods and Financial Records

     90   

SECTION 8.8 Payment of Taxes

     91   

SECTION 8.9 Compliance with Laws and Approvals

     91   

SECTION 8.10 Environmental Laws

     91   

SECTION 8.11 Compliance with ERISA

     91   

SECTION 8.12 Visits and Inspections

     91   

SECTION 8.13 Additional Subsidiaries

     92   

SECTION 8.14 Use of Proceeds

     92   

ARTICLE IX NEGATIVE COVENANTS

     92   

SECTION 9.1 Indebtedness

     93   

SECTION 9.2 Liens

     95   

SECTION 9.3 Investments

     98   

SECTION 9.4 Fundamental Changes

     101   

SECTION 9.5 Asset Dispositions

     102   

SECTION 9.6 Restricted Payments

     103   

SECTION 9.7 Transactions with Affiliates

     105   

SECTION 9.8 Accounting Changes; Organizational Documents

     105   

SECTION 9.9 Modifications of Material Agreements

     106   

SECTION 9.10 No Further Negative Pledges; Restrictive Agreements

     106   

SECTION 9.11 Nature of Business

     108   

SECTION 9.12 Sale Leasebacks

     108   

SECTION 9.13 Lease Obligations

     108   

SECTION 9.14 Financial Covenants

     108   

ARTICLE X DEFAULT AND REMEDIES

     108   

SECTION 10.1 Events of Default

     108   

SECTION 10.2 Remedies

     112   

SECTION 10.3 Rights and Remedies Cumulative; Non-Waiver; etc.

     113   

SECTION 10.4 Crediting of Payments and Proceeds

     113   

SECTION 10.5 Administrative Agent May File Proofs of Claim

     114   

SECTION 10.6 Credit Bidding

     115   

ARTICLE XI THE ADMINISTRATIVE AGENT

     115   

SECTION 11.1 Appointment and Authority

     115   

SECTION 11.2 Rights as a Lender

     116   

SECTION 11.3 Exculpatory Provisions

     116   

SECTION 11.4 Reliance by the Administrative Agent

     117   

SECTION 11.5 Delegation of Duties

     118   

SECTION 11.6 Resignation of Administrative Agent

     118   

SECTION 11.7 Non-Reliance on Administrative Agent and Other Lenders

     119   

SECTION 11.8 No Other Duties, etc

     119   

SECTION 11.9 Collateral and Guaranty Matters

     120   

SECTION 11.10 Facility Hedge Agreements and Facility Cash Management Agreements

     121   

 

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ARTICLE XII MISCELLANEOUS

     121   

SECTION 12.1 Notices

     121   

SECTION 12.2 Amendments, Waivers and Consents

     124   

SECTION 12.3 Expenses; Indemnity

     126   

SECTION 12.4 Right of Setoff

     128   

SECTION 12.5 Governing Law; Jurisdiction, Etc.

     129   

SECTION 12.6 Waiver of Jury Trial

     129   

SECTION 12.7 Reversal of Payments

     130   

SECTION 12.8 Injunctive Relief

     130   

SECTION 12.9 Accounting Matters

     130   

SECTION 12.10 Successors and Assigns; Participations

     130   

SECTION 12.11 Treatment of Certain Information; Confidentiality

     135   

SECTION 12.12 Performance of Duties

     136   

SECTION 12.13 All Powers Coupled with Interest

     136   

SECTION 12.14 Survival

     136   

SECTION 12.15 Titles and Captions

     136   

SECTION 12.16 Severability of Provisions

     137   

SECTION 12.17 Counterparts; Integration; Effectiveness; Electronic Execution

     137   

SECTION 12.18 Term of Agreement

     137   

SECTION 12.19 USA PATRIOT Act

     137   

SECTION 12.20 Inconsistencies with Other Documents

     137   

SECTION 12.21 No Advisory or Fiduciary Responsibility

     138   

 

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EXHIBITS

 

Exhibit A-1

  —    Form of Revolving Credit Note

Exhibit A-2

  —    Form of Swingline Note

Exhibit B

  —    Form of Notice of Borrowing

Exhibit C

  —    Form of Notice of Account Designation

Exhibit D

  —    Form of Notice of Prepayment

Exhibit E

  —    Form of Notice of Conversion/Continuation

Exhibit F

  —    Form of Officer’s Compliance Certificate

Exhibit G

  —    Form of Assignment and Assumption

Exhibit H

  —    Form of Lender-Surety Agreement

Exhibit I

  —    Form of Ship Mortgage

Exhibit J-1

  —    Form of U.S. Tax Compliance Certificate (Foreign Lenders That Are Not
Partnerships)

Exhibit J-2

  —    Form of U.S. Tax Compliance Certificate (Foreign Participants That Are
Not Partnerships)

Exhibit J-3

  —    Form of U.S. Tax Compliance Certificate (Foreign Participants That Are
Partnerships)

Exhibit J-4

  —    Form of U.S. Tax Compliance Certificate (Foreign Lenders That Are
Partnerships)

Exhibit K

  —    Form of Financial Condition/Solvency Certificate SCHEDULES

Schedule I

  —    Commitments

Schedule 1.1(a)

  —    Existing Hedge Banks

Schedule 1.1(b)

  —    Existing Letters of Credit

Schedule 1.1(c)

  —    Initial Subsidiary Guarantors

Schedule 7.1

  —    Jurisdictions of Organization and Qualification

Schedule 7.2

  —    Subsidiaries and Capitalization

Schedule 7.9

  —    ERISA Plans

Schedule 7.13

  —    List of Insurance Policies

Schedule 9.1

  —    Existing Indebtedness

Schedule 9.2

  —    Existing Liens

Schedule 9.3

  —    Existing Loans, Advances and Investments

Schedule 9.7

  —    Transactions with Affiliates

Schedule 12.10

  —    List of Competitors

 

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CREDIT AGREEMENT, dated as of June 4, 2012, by and among GREAT LAKES DREDGE &
DOCK CORPORATION, a Delaware corporation, as Borrower, the other CREDIT PARTIES
from time to time party hereto, the LENDERS who are party to this Agreement and
the lenders who may become a party to this Agreement pursuant to the terms
hereof, as Lenders, and WELLS FARGO BANK, NATIONAL ASSOCIATION, a national
banking association, as Administrative Agent for the Lenders, as Swingline
Lender and as an Issuing Lender.

STATEMENT OF PURPOSE

WHEREAS, the Borrower has requested, and, subject to the terms and conditions
hereof, the Administrative Agent and the Lenders have agreed, to extend a senior
revolving credit facility to the Borrower in an aggregate principal amount of up
to $175,000,000, with (i) the availability to increase the Aggregate Commitment
hereunder in an aggregate amount not to exceed $50,000,000 and
(ii) subfacilities for (A) Letters of Credit up to a $125,000,000 sublimit,
(B) Alternative Currency borrowings up to a $50,000,000 sublimit and
(C) Swingline Loans up to a $10,000,000 sublimit, in each case, on the terms and
conditions of this Agreement.

WHEREAS, the proceeds of the Extensions of Credit will be used to finance
(i) the Refinancing and (ii) the working capital and general corporate purposes
of the Borrower and its Subsidiaries, including Permitted Acquisitions and other
Investments permitted hereunder and the payment of fees, costs and expenses
incurred in connection with the Transactions and this Agreement.

WHEREAS, the Lenders and the Issuing Lenders are willing to make available to
the Borrower such credit facilities, upon the terms and subject to the
conditions set forth herein.

NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged by the parties hereto, such parties hereby
agree as follows:

ARTICLE I

DEFINITIONS

SECTION 1.1 Definitions. The following terms when used in this Agreement shall
have the meanings assigned to them below:

“Additional Subsidiary Guarantor” means (a) each Domestic Subsidiary of the
Borrower in existence on the Closing Date which hereafter ceases to be an
Immaterial Subsidiary and (b) each Domestic Subsidiary of the Borrower, other
than an Immaterial Subsidiary, formed or acquired after the Closing Date.

“Administrative Agent” means Wells Fargo, in its capacity as Administrative
Agent hereunder, and any successor thereto appointed pursuant to Section 11.6.

“Administrative Agent’s Office” means the office of the Administrative Agent
specified in or determined in accordance with the provisions of Section 12.1(c).

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

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

“Agreement” means this Credit Agreement, as amended, restated, supplemented or
otherwise modified from time to time.

“Aggregate Commitment” means, as to all Lenders, the aggregate Commitments of
all Lenders to make Loans, as such amount may be modified at any time or from
time to time pursuant to the terms hereof (including, without limitation,
Section 5.13). The Aggregate Commitment of all the Lenders on the Closing Date
shall be $175,000,000.

“Alternative Currency” means (i) in respect of any Loans, Euro and each other
lawful currency (other than Dollars) that is approved by the Administrative
Agent and the Lenders and (ii) in respect of any Letters of Credit, (A) Euro,
British Pounds Sterling, Canadian Dollars, Australian Dollars and each other
lawful currency (other than Dollars) which is freely transferable and
convertible into Dollars that is approved by the Administrative Agent and the
applicable Issuing Lender and (B) the lawful currencies of Bahrain, Qatar, Oman,
Kuwait, the United Arab Emirates, the Republic of India and all countries
located in South America, in each case, to the extent such currencies are freely
transferable and convertible into Dollars and approved by the Administrative
Agent and the applicable Issuing Lender.

“Alternative Currency Loan Commitment” means the lesser of (a) $50,000,000 and
(b) the Aggregate Commitment. The Alternative Currency Loan Commitment is part
of, and not in addition to, the Aggregate Commitment.

“Applicable Law” means all applicable provisions of constitutions, laws,
statutes, ordinances, rules, treaties, regulations, permits, licenses,
approvals, interpretations and orders of courts or Governmental Authorities and
all orders and decrees of all courts and arbitrators.

“Applicable Margin” means the corresponding percentages per annum as set forth
below based on the Consolidated Total Leverage Ratio:

 

Pricing
Level

 

Consolidated Total

Leverage Ratio

  Commitment
Fee     LIBOR Rate
Loans /
Financial
Letters of
Credit     Performance
Letters of
Credit     Base Rate
Loans  

I

  Greater than or equal to 3.75 to 1.00     0.45 %      2.50 %      1.25 %     
1.50 % 

II

  Greater than or equal to 3.00 to 1.00, but less than 3.75 to 1.00     0.40 % 
    2.25 %      1.125 %      1.25 % 

 

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Pricing
Level

 

Consolidated Total

Leverage Ratio

  Commitment
Fee     LIBOR Rate
Loans /
Financial
Letters of
Credit     Performance
Letters of
Credit     Base Rate
Loans  

III

  Greater than or equal to 2.25 to 1.00, but less than 3.00 to 1.00     0.35 % 
    2.00 %      1.00 %      1.00 % 

IV

  Greater than or equal to 1.50 to 1.00, but less than 2.25 to 1.00     0.30 % 
    1.75 %      0.875 %      0.75 % 

V

  Less than to 1.50 to 1.00     0.25 %      1.50 %      0.75 %      0.50 % 

The Applicable Margin shall be determined and adjusted quarterly on the date
(each a “Calculation Date”) which is two Business Days after the day on which
the Borrower is required to provide an Officer’s Compliance Certificate pursuant
to Section 8.2(a) for the most recently ended fiscal quarter of the Borrower;
provided that (a) the Applicable Margin shall be based on Pricing Level IV until
the first Calculation Date with respect to the fiscal quarter ending
September 30, 2012 and, thereafter the Pricing Level shall be determined by
reference to the Consolidated Total Leverage Ratio as of the last day of the
most recently ended fiscal quarter of the Borrower preceding the applicable
Calculation Date, and (b) if the Borrower fails to provide the Officer’s
Compliance Certificate as required by Section 8.2(a) for the most recently ended
fiscal quarter of the Borrower preceding the applicable Calculation Date, the
Applicable Margin from such Calculation Date shall be based on Pricing Level I
until such time as an appropriate Officer’s Compliance Certificate is provided,
at which time the Pricing Level shall be determined by reference to the
Consolidated Total Leverage Ratio as of the last day of the most recently ended
fiscal quarter of the Borrower preceding such Calculation Date. The Applicable
Margin shall be effective from one Calculation Date until the next Calculation
Date. Any adjustment in the Applicable Margin shall be applicable to all
Extensions of Credit then existing or subsequently made or issued.

Notwithstanding the foregoing, in the event that any financial statement or
Officer’s Compliance Certificate delivered pursuant to Section 8.1 or 8.2(a) is
shown to be inaccurate (regardless of whether (i) this Agreement is in effect,
(ii) the Aggregate Commitment is in effect, or (iii) any Extension of Credit is
outstanding when such inaccuracy is discovered or such financial statement or
Officer’s Compliance Certificate was delivered), and such inaccuracy, if
corrected, would have led to the application of a higher Applicable Margin for
any period (an “Applicable Period”) than the Applicable Margin applied for such
Applicable Period, then (A) the Borrower shall immediately deliver to the
Administrative Agent a corrected Officer’s Compliance Certificate for such
Applicable Period, (B) the Applicable Margin for such Applicable Period shall be
determined as if the Consolidated Total Leverage Ratio in the corrected
Officer’s Compliance Certificate were applicable for such Applicable Period, and
(z) the Borrower shall immediately and retroactively be obligated to pay to the
Administrative Agent the accrued

 

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additional interest and fees owing as a result of such increased Applicable
Margin for such Applicable Period, which payment shall be promptly applied by
the Administrative Agent in accordance with Section 5.4. Nothing in this
paragraph shall limit the rights of the Administrative Agent and Lenders with
respect to Sections 5.1(c) and 10.2 nor any of their other rights under this
Agreement. The Borrower’s obligations under this paragraph shall survive the
termination of the Aggregate Commitment and the repayment of all other
Obligations hereunder.

The Applicable Margins set forth above shall be increased as, and to the extent,
required by Section 5.13.

“Approved Appraiser” means North American Marine Consultants, LLC, or such other
appraiser reasonably satisfactory to the Administrative Agent.

“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.

“Arranger” means Wells Fargo Securities, LLC, in its capacity as sole lead
arranger and sole bookrunner, and its successors.

“Asset Disposition” means the disposition of any or all of the assets
(including, without limitation, any Capital Stock owned thereby) of any Credit
Party or any Subsidiary thereof whether by sale, lease, transfer or otherwise,
and any issuance of Capital Stock by any Subsidiary of the Borrower to any
Person that is not a Credit Party or any Subsidiary thereof. The term “Asset
Disposition” shall not include (a) any Equity Issuance, (b) the sale of
inventory in the ordinary course of business, (c) the transfer of assets to the
Borrower or any Subsidiary Guarantor pursuant to any other transaction permitted
pursuant to Section 9.4, (d) the write-off, discount, sale or other disposition
of defaulted or past-due receivables and similar obligations in the ordinary
course of business and not undertaken as part of an accounts receivable
financing transaction, (e) the disposition of any Hedge Agreement,
(f) dispositions of Investments in cash and Cash Equivalents, and (f) (i) the
transfer by any Credit Party of its assets to any other Credit Party, (ii) the
transfer by any Non-Guarantor Subsidiary of its assets to any Credit Party
(provided that in connection with any such transfer, such Credit Party shall not
pay more than an amount equal to the fair market value of such assets as
determined in good faith at the time of such transfer) and (iii) the transfer by
any Non-Guarantor Subsidiary of its assets to any other Non-Guarantor
Subsidiary.

“Assignment and Assumption” means an assignment and assumption entered into by a
Lender and an assignee (with the consent of any party whose consent is required
by Section 12.10), and accepted by the Administrative Agent, in substantially
the form attached as Exhibit G or any other form approved by the Administrative
Agent.

“Base Rate” means, at any time, the highest of (a) the Prime Rate, (b) the
Federal Funds Rate plus 0.50% and (c) except during any period of time during
which a notice delivered to the Borrower under Section 5.8 shall remain in
effect, LIBOR for an Interest Period of one month plus 1%; each change in the
Base Rate shall take effect simultaneously with the corresponding change or
changes in the Prime Rate, the Federal Funds Rate or LIBOR.

 

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“Base Rate Loan” means any Loan bearing interest at a rate based upon the Base
Rate as provided in Section 5.1(a).

“Bonding Agreement” means, collectively, the Zurich Agreement and any supplement
thereto or replacement thereof, and any similar contractual arrangement entered
into by the Borrower or any of its Subsidiaries with providers of bid,
performance or payment bonds.

“Bonding Obligations” means (a) obligations incurred by the Borrower and its
Subsidiaries (including guaranties thereof) with respect to bid, payment,
performance, surety, appeal or similar bonds and completion guaranties in the
ordinary course of business and (b) obligations incurred by the Borrower and its
Subsidiaries (including guaranties thereof) under any Bonding Agreement.

“Borrower” means Great Lakes Dredge & Dock Corporation, a Delaware corporation.

“Borrower Materials” has the meaning assigned thereto in Section 8.2.

“Business Day” means (a) for all purposes other than as set forth in clause (b)
below, any day (other than a Saturday, Sunday or legal holiday) on which banks
in New York, New York and Chicago, Illinois, are open for the conduct of their
commercial banking business, and (b) with respect to all notices and
determinations in connection with, and payments of principal and interest on,
any LIBOR Rate Loan, or any Base Rate Loan as to which the interest rate is
determined by reference to LIBOR, any day that is a Business Day described in
clause (a) and that is also a day for trading by and between banks in Dollar
deposits in the London interbank market.

“Calculation Date” has the meaning assigned thereto in the definition of
Applicable Margin.

“Capital Asset” means, with respect to the Borrower and its Subsidiaries, any
asset that should, in accordance with GAAP, be classified and accounted for as a
capital asset on a Consolidated balance sheet of the Borrower and its
Subsidiaries. Notwithstanding the foregoing, any obligations of a Person under a
lease (whether existing now or entered into in the future) that is not (or would
not be) a Capital Lease under GAAP as in effect on the Closing Date, shall not
be treated as a Capital Lease solely as a result of the adoption after the
Closing Date of changes in GAAP.

“Capital Expenditures” means, with respect to the Borrower and its Subsidiaries
for any period, the aggregate cost of all Capital Assets acquired by the
Borrower and its Subsidiaries during such period, as determined in accordance
with GAAP.

“Capital Lease” means any lease of any property by the Borrower or any of its
Subsidiaries, as lessee, that should, in accordance with GAAP, be classified and
accounted for as a capital lease on a Consolidated balance sheet of the Borrower
and its Subsidiaries. Notwithstanding the foregoing, any obligations of a Person
under a lease (whether existing now or entered into in the future) that is not
(or would not be) a Capital Lease under GAAP as in effect on the Closing Date,
shall not be treated as a Capital Lease solely as a result of the adoption after
the Closing Date of changes in GAAP.

 

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“Capital Stock” means (a) in the case of a corporation, capital stock, (b) in
the case of an association or business entity, any and all shares, interests,
participations, rights or other equivalents (however designated) of capital
stock, (c) in the case of a partnership, partnership interests (whether general
or limited), (d) in the case of a limited liability company, membership
interests, (e) any other interest or participation that confers on a Person the
right to receive a share of the profits and losses of, or distributions of
assets of, the issuing Person and (f) any and all warrants, rights or options to
purchase any of the foregoing.

“Cash Collateralize” means, to pledge and deposit with or deliver to the
Administrative Agent, for the benefit of one or more of the Issuing Lenders or
the Lenders, as collateral for L/C Obligations or obligations of the Lenders to
fund participations in respect of L/C Obligations, (a) cash or deposit account
balances (in an amount equal to 105% of the aggregate undrawn face amount
thereof), (b) backstop letters of credit entered into on terms, from issuers and
in amounts satisfactory to the Administrative Agent and the applicable Issuing
Lender, and/or (c) if the Administrative Agent and the applicable Issuing Lender
shall agree, in their sole discretion, other credit support, in each case, in
Dollars and pursuant to documentation in form and substance satisfactory to the
Administrative Agent and such Issuing Lender. “Cash Collateral” shall have a
meaning correlative to the foregoing and shall include the proceeds of such Cash
Collateral and other credit support.

“Cash Equivalents” means, at any time, Investments of the Borrower or any of its
Subsidiaries in (a) any obligation, maturing not more than one hundred twenty
(120) days from the date of creation thereof, which is issued or guaranteed by
the United States Government or issued by an agency thereof and backed by the
full faith and credit of the United States; (b) commercial paper, maturing not
more than one hundred twenty (120) days from the date of creation thereof, which
is issued by (i) a corporation (other than an Affiliate of any Credit Party)
organized under the laws of any state of the United States or of the District of
Columbia which has a short-term credit rating of at least A-1 by S&P and P-1 by
Moody’s, or (ii) any Lender (or its holding company) having a long-term credit
rating of at least A by S&P and A2 by Moody’s; (c) any certificate of deposit,
time or demand deposit (including Eurodollar time deposits) or bankers
acceptance, maturing not more than one hundred twenty (120) days from the date
of creation thereof, which is issued by either (i) a commercial banking
institution organized under the laws of the United States or any State thereof
or the District of Columbia that has a combined capital, surplus and undivided
profits of not less than $500,000,000 and has a long-term credit rating of at
least A by S&P and A2 by Moody’s, (ii) any Lender with a long-term credit rating
of at least A by S&P and A2 by Moody’s, or (iii) (A) any branch of any Lender
having a long-term credit rating of at least A by S&P and A2 by Moody’s, (B) any
commercial banking institution organized under the laws of the United States or
any State thereof or any Organization for Economic Co-operation and Development
country which has a combined capital, surplus and undivided profits of not less
than $500,000,000 and has a long-term credit rating of at least A by S&P and A2
by Moody’s or (C) any financial institution organized under the laws of a
country where the Borrower or any of its Subsidiaries is engaged in a dredging
or construction project to the extent such certificates of deposit, time or
demand deposits (including Eurodollar time deposits) or bankers acceptances are
reasonably necessary in connection with such dredging or construction project
with a long-term credit rating of at least A by S&P and A2 by Moody’s; (d) fully
collateralized repurchase agreements with a term of not more than 30 days for
underlying securities of the type described in clause (a) above, entered into
with any institution

 

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meeting the qualifications specified in clause (c) above; (e) short-term asset
management accounts offered by any Lender for the purpose of investing in notes
issued by a corporation (other than an Affiliate of any Credit Party) organized
under the laws of any state of the United States or of the District of Columbia
and having a short-term credit rating of at least A-1 by S&P and P-1 by Moody’s;
(f) Dollars or money in other currencies received in the ordinary course of
business; or (g) money market funds at least 95% of the assets of which
constitute Cash Equivalents of the kinds described in clauses (a), (b), (c) and
(f) of this definition.

“Cash Management Agreement” means any agreement to provide cash management
services, including treasury, depository, overdraft, credit or debit card,
electronic funds transfer and other cash management arrangements.

“Cash Management Bank” means any Person that, at the time (i) it enters into a
Cash Management Agreement, is a Lender, an Affiliate of a Lender, the
Administrative Agent or an Affiliate of the Administrative Agent, in its
capacity as a party to such Cash Management Agreement or (ii) it (or its
Affiliate) becomes a Lender or the Administrative Agent, is a party to a Cash
Management Agreement with a Credit Party.

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

(a) any “person” or “group” (as such terms are used in Sections 13(d) and 14(d)
of the Exchange Act, but excluding any employee benefit plan of such person or
its Subsidiaries, and any person or entity acting in its capacity as trustee,
agent or other fiduciary or administrator of any such plan) becomes the
“beneficial owner” (as defined in Rules 13d-3 and 13d-5 under the Exchange Act,
except that a “person” or “group” shall be deemed to have “beneficial ownership”
of all Capital Stock that such “person” or “group” has the right to acquire,
whether such right is exercisable immediately or only after the passage of time
(such right, an “option right”)), directly or indirectly, of more than
thirty-five percent (35%) of the Capital Stock of the Borrower entitled to vote
in the election of members of the board of directors (or equivalent governing
body) of Borrower; or

(b) any “Change of Control” (or any similar or comparable definition or
provision) occurs under any agreement governing Note Indenture Obligations; or

(c) a majority of the members of the board of directors (or other equivalent
governing body) of the Borrower are not Continuing Directors.

“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, (i) the Dodd-Frank Wall Street Reform and Consumer Protection Act and
all requests, rules, guidelines or directives thereunder or issued in connection
therewith and (ii) 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.

 

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“Closing Date” means June 4, 2012.

“Closing Escrowed Documents” has the meaning assigned thereto in
Section 6.1(b)(i).

“Closing Leverage Ratio” has the meaning assigned thereto in Section 6.1(f)(iv).

“Code” means the Internal Revenue Code of 1986, and the rules and regulations
promulgated thereunder, each as amended or modified from time to time.

“Collateral” has the meaning assigned thereto in Section 4.1(a).

“Commitment Fee” has the meaning assigned thereto in Section 5.3(a).

“Commitment Percentage” means, as to any Lender, the ratio of (a) the amount of
the Commitment of such Lender to (b) the Aggregate Commitment.

“Commitment” means, as to any Lender, the obligation of such Lender to make
Loans to the account of the Borrower hereunder and to participate in Letters of
Credit in an aggregate principal amount at any time outstanding not to exceed
the amount set forth opposite such Lender’s name on Schedule I attached hereto,
as such amount may be modified at any time or from time to time pursuant to the
terms hereof (including, without limitation, Section 5.13).

“Computation Date” means (a) with respect to any Revolving Credit Loan, each of
the following: (i) each date of a borrowing of a Revolving Credit Loan in an
Alternative Currency, (ii) the continuation or conversion of a Revolving Credit
Loan in an Alternative Currency and (iii) such additional dates as the
Administrative Agent shall determine or the Required Lenders shall require; and
(b) with respect to any Letter of Credit, each of the following: (i) each date
of issuance of a Letter of Credit denominated in an Alternative Currency,
(ii) each date of an amendment of any such Letter of Credit having the effect of
increasing the amount thereof (solely with respect to the increased amount),
(iii) each date of any payment by an Issuing Lender under any Letter of Credit
denominated in an Alternative Currency and (iv) such additional dates as the
Administrative Agent or the applicable Issuing Lender shall determine or the
Required Lenders shall require.

“Consolidated” means, when used with reference to financial statements or
financial statement items of any Person, such statements or items on a
consolidated basis in accordance with applicable principles of consolidation
under GAAP.

“Consolidated Cash Interest Expense” means, for any period, the sum of the
following determined on a Consolidated basis, without duplication, for the
Borrower and its Subsidiaries in accordance with GAAP, interest expense (net of
interest income received in cash) paid in cash (including, without limitation,
interest expense paid in cash which is attributable to Capital Leases and all
net payment obligations paid in cash pursuant to Hedge Agreements) for such
period.

 

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“Consolidated EBITDA” means, for any period, the sum of the following determined
on a Consolidated basis, without duplication, for the Borrower and its
Subsidiaries in accordance with GAAP: (a) Consolidated Net Income for such
period plus (b) the sum of the following, without duplication, to the extent
deducted in determining Consolidated Net Income for such period: (i) federal,
state, local and foreign income and franchise taxes, (ii) total interest expense
(net of interest income) for such period, (iii) depreciation, depletion and
amortization expense (including amortization of intangible assets (including
goodwill)), (iv) non-cash charges and losses (excluding any such non-cash
charges or losses to the extent (x) there were cash charges with respect to such
charges and losses in past accounting periods, (y) there is a reasonable
expectation that there will be cash charges with respect to such charges and
losses in future accounting periods or (z) they consist of write-downs of
accounts receivable that exceed $5,000,000 in the aggregate during any Fiscal
Year), (v) Transaction Costs (other than Transaction Costs incurred in
connection with (x) the Transactions that exceed $5,000,000 in the aggregate or
(y) any Permitted Acquisition or the amendment, consent or waiver of any Loan
Document or otherwise unrelated to the Transactions that exceed $1,000,000 in
the aggregate during any Fiscal Year), (vi) any amounts included in the
calculation of Consolidated Net Income for amortization or non-cash charges for
the write-off or impairment of goodwill, intangibles or other purchase
accounting adjustments related to the accounting for the Transactions or other
acquisitions under GAAP (including Financial Accounting Standards Codification
350 and 805), (vii) non-recurring restructuring charges or reserves and business
optimization expense (including any non-recurring restructuring costs and
integration costs incurred in connection with Permitted Acquisitions after the
Closing Date), costs related to the closure or consolidation of facilities,
relocation and severance expenses, systems establishment costs and conversion
costs, provided that the aggregate amount of add-backs made pursuant to this
clause (vii), shall not exceed $5,000,000 during any Fiscal Year, (viii) fees
and expenses incurred in connection with the negotiation or entering into of any
Bonding Agreement or any amendment, restatement, supplement or other
modification of any Bonding Agreement, and (ix) Consolidated Net Income
attributable to the minority equity interest that is owned, directly or
indirectly, by the Borrower in Yankee or any other non-wholly owned Subsidiary
to the extent the Net Income in respect of such minority equity interest is
received by the Borrower, less (c) without duplication and to the extent
reflected as a gain or otherwise included in the calculation of such
Consolidated Net Income for such period, (i) non-cash gains (excluding any such
non-cash gains to the extent (x) there were cash gains with respect to such
gains in past accounting periods or (y) there is a reasonable expectation that
there will be cash gains with respect to such gains in future accounting
periods) and (ii) Consolidated Net Income attributable to the minority equity
interest that is not owned, directly or indirectly, by the Borrower in Yankee or
any other non-wholly owned Subsidiary to the extent the Net Income in respect of
such minority equity interest is distributed to the holder or holders of such
minority equity interest and plus, (d) without duplication, cash dividends
received by the Borrower or any Subsidiary from Amboy Aggregates, a New Jersey
joint venture, and any other equity joint ventures. For purposes of this
Agreement, Consolidated EBITDA shall be adjusted on a Pro Forma Basis.

“Consolidated Fixed Charges” means, for any period, the sum of the following
determined on a Consolidated basis for such period, without duplication, for the
Borrower and its Subsidiaries in accordance with GAAP: (a) Consolidated Cash
Interest Expense and (b) scheduled principal payments with respect to
Indebtedness (including, without limitation, scheduled principal payments which
are attributable to Capital Leases).

 

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“Consolidated Fixed Charge Coverage Ratio” means, as of any date of
determination, the ratio of (a) the sum of (i) Consolidated EBITDA for the
period of four (4) consecutive fiscal quarters ending on or immediately prior to
such date, minus (ii) Capital Expenditures accrued with respect to the
maintenance of Capital Assets of the Borrower and its Subsidiaries for the
period, minus (iii) Restricted Payments paid in cash for the period, minus
(iv) federal, state, local and foreign income taxes paid in cash for the period,
to (b) Consolidated Fixed Charges for the period of four (4) consecutive fiscal
quarters ending on or immediately prior to such date.

“Consolidated Net Income” means, for any period, the net income (or loss) of the
Borrower and its Subsidiaries for such period, determined on a Consolidated
basis, without duplication, in accordance with GAAP (exclusive of all amounts in
respect of any extraordinary or non-recurring gains or losses).

“Consolidated Net Worth” means, as of any time of determination thereof, an
amount equal to the consolidated stockholders’ equity of the Borrower and its
Subsidiaries determined in accordance with GAAP as of the date of the most
recent consolidated balance sheet of the Borrower and its Subsidiaries that has
been or is required to be delivered pursuant to Section 8.1 (less amounts
attributable to Disqualified Capital Stock) at such time.

“Consolidated Total Indebtedness” of the Borrower, means as of any date of
determination, the sum of (without duplication), (a) all Indebtedness (other
than any Operating Lease) of the Borrower and its Subsidiaries on a Consolidated
basis which, in accordance with GAAP, should be included as liabilities in the
consolidated balance sheet of the Borrower and its Subsidiaries at such time,
plus (b) the undrawn face amount of letters of credit (other than (i) letters of
credit issued to (x) Zurich in an amount not to exceed $12,500,000 to support
the Bonding Obligations held by Zurich and (y) Travelers pursuant to the terms
set forth in the Travelers’ Termination Agreement, (ii) Performance Letters of
Credit and (iii) standby letters of credit issued pursuant to the Wells Fargo
Agreement) and bank guarantees (other than those issued to support performance
obligations), plus (c) the principal amount of all guarantees executed by such
Person.

“Consolidated Total Leverage Ratio” means, as of any date of determination, the
ratio of (a) the sum of (i) the Consolidated Total Indebtedness on such date
minus (ii) the aggregate amount of unrestricted cash and Cash Equivalents of the
Borrower and its Subsidiaries in the United States on such date, to
(b) Consolidated EBITDA for the period of four (4) consecutive fiscal quarters
ending on or immediately prior to such date.

“Continuing Directors” means the directors of the Borrower on the Closing Date
and each other director of the Borrower, if, in each case, such other director’s
nomination for election to the board of directors (or equivalent governing body)
of the Borrower is recommended by at least 51% of the then Continuing Directors.

“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.

 

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“Credit Parties” means, collectively, the Borrower and the Subsidiary
Guarantors.

“Debt Issuance” shall mean the issuance of any Indebtedness for borrowed money
by any Credit Party or any of its Subsidiaries.

“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 of the events specified in Section 10.1 which with the
passage of time, the giving of notice or any other condition, would constitute
an Event of Default.

“Defaulting Lender” means, subject to Section 5.15(b), any Lender that (a) has
failed to (i) fund all or any portion of the Revolving Credit Loans,
participations in L/C Obligations or participations in Swingline Loans required
to be funded by it hereunder within two Business Days of the date such Loans or
participations were required to be funded hereunder, unless such Lender notifies
the Administrative Agent and the Borrower 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 Administrative Agent, the applicable Issuing
Lender, the Swingline 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 Swingline Loans) within two Business Days of the date when due,
(b) has notified the Borrower, the Administrative Agent, any Issuing Lender or
the Swingline 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 Administrative Agent or the Borrower,
to confirm in writing to the Administrative Agent and the Borrower 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 Administrative Agent and the
Borrower), 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

 

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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 Administrative Agent that a Lender is a
Defaulting Lender under 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 5.15(b)) upon delivery of written notice
of such determination to the Borrower, the Issuing Lenders, the Swingline Lender
and each Lender.

“Designated Vessels” means, on any date of determination prior to the Springing
Lien Termination Date, those certain flag vessels subject to a Ship Mortgage
whether or not a Perfection Period shall be in effect.

“Disqualified Capital Stock” means any Capital Stock that, by its terms (or by
the terms of any security or other Capital Stock into which it is convertible or
for which it is exchangeable) or upon the happening of any event or condition,
(a) matures or is mandatorily redeemable (other than solely for Qualified
Capital Stock), pursuant to a sinking fund obligation or otherwise (except as a
result of a change of control or asset sale so long as any rights of the holders
thereof upon the occurrence of a change of control or asset sale event shall be
subject to the prior repayment in full of the Loans and all other Obligations
that are accrued and payable and the termination of the Aggregate Commitment),
(b) is redeemable at the option of the holder thereof (other than solely for
Qualified Capital Stock) (except as a result of a change of control or asset
sale so long as any rights of the holders thereof upon the occurrence of a
change of control or asset sale event shall be subject to the prior repayment in
full of the Loans and all other Obligations that are accrued and payable and the
termination of the Aggregate Commitment), in whole or in part, (c) provides for
the scheduled payment of dividends in cash or (d) is or becomes convertible into
or exchangeable for Indebtedness or any other Capital Stock that would
constitute Disqualified Capital Stock, in each case for clauses (a) through
(d) above, prior to the date that is 91 days after the Revolving Credit Maturity
Date; provided, that if such Capital Stock is issued pursuant to a plan for the
benefit of the Borrower or its Subsidiaries or by any such plan to such
employees, such Capital Stock shall not constitute Disqualified Capital Stock
solely because it may be required to be repurchased by the Borrower or its
Subsidiaries in order to satisfy applicable statutory or regulatory obligations.

“Dollar Equivalent Amount” means, at any time, (a) with respect to any amount
denominated in Dollars, such amount, and (b) with respect to any amount
denominated in any Alternative Currency, the equivalent amount thereof in
Dollars as determined by the Administrative Agent or the applicable Issuing
Lender at such time on the basis of the Exchange Rate (determined in respect of
the most recent Computation Date) for the purchase of Dollars with such
Alternative Currency.

“Dollars” or “$” means, unless otherwise qualified, dollars in lawful currency
of the United States.

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

 

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“Eligible Assignee” means any Person that meets the requirements to be an
assignee under Sections 12.10(b)(iii), (v) and (vi) (subject to such consents,
if any, as may be required under Section 12.10(b)(iii)).

“Employee Benefit Plan” means any employee benefit plan within the meaning of
Section 3(2) of ERISA that is maintained for employees of any Credit Party or
any ERISA Affiliate including any Pension Plan that has at any time within the
preceding six (6) years been maintained, funded or administered for the
employees of any Credit Party or any current or former ERISA Affiliate.

“Environmental Claims” means any and all administrative, regulatory or judicial
actions, suits, demands, demand letters, claims, liens, notices of violation,
investigations (other than internal reports prepared by any Person in the
ordinary course of business and not in response to any Governmental Authority)
or proceedings relating in any way to any actual or alleged violation of or
liability under any Environmental Law or relating to any permit issued, under
any such Environmental Law, including, without limitation, any and all orders by
Governmental Authorities for enforcement, cleanup, removal, response, remedial
or other actions, contribution, cost recovery, compensation or injunctive relief
resulting from any release of Hazardous Materials giving rise to any alleged
injury or threat of injury to human health or the environment.

“Environmental Laws” means any and all federal, foreign, state, provincial and
local laws, statutes, ordinances, codes, rules, standards and regulations,
permits, licenses and orders of courts or Governmental Authorities, relating to
the protection of human health or the environment, including, but not limited
to, requirements pertaining to the manufacture, processing, distribution, use,
treatment, storage, disposal, transportation, handling, reporting, licensing,
permitting, investigation or remediation of Hazardous Materials.

“Equipment Utilization Agreement” means the Equipment Utilization Agreement,
dated as of the date hereof, among the Borrower, certain Subsidiaries of the
Borrower as indemnitors, the Administrative Agent and Zurich, as surety
thereunder, as may be amended, restated, supplemented or otherwise modified from
time to time in accordance with the terms thereof.

“Equity Issuance” means (a) any issuance by any Credit Party or any Subsidiary
thereof to any Person that is not a Credit Party or a Subsidiary thereof, of
(i) shares of its Capital Stock, (ii) any shares of its Capital Stock pursuant
to the exercise of options or warrants or (iii) any shares of its Capital Stock
pursuant to the conversion of any debt securities to equity and (b) any capital
contribution from any Person that is not a Credit Party into any Credit Party or
any Subsidiary thereof. The term “Equity Issuance” shall not include (A) any
Asset Disposition or (B) any Debt Issuance.

“ERISA” means the Employee Retirement Income Security Act of 1974, and the rules
and regulations thereunder, each as amended or modified from time to time.

“ERISA Affiliate” means any Person who together with any Credit Party or any of
its Subsidiaries is treated as a single employer within the meaning of
Section 414(b), (c), (m) or (o) of the Code or Section 4001(b) of ERISA.

“Escrow Agent” means JPMorgan Chase Bank, N.A. and its successors and assigns.

 

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“Escrow Agreement” means that certain Escrow Agreement dated as of June 4, 2012,
among the Borrower, the Administrative Agent and the Escrow Agent, as amended,
restated, supplemented or otherwise modified from time to time in accordance
with the terms thereof.

“Escrowed Documents” means the Closing Escrowed Documents and the Replacement
Escrowed Documents.

“Eurodollar Reserve Percentage” means, for any day, the percentage (expressed as
a decimal and rounded upwards, if necessary, to the next higher 1/100th of 1%)
which is in effect for such day as prescribed by the Board of Governors of the
Federal Reserve System (or any successor) for determining the maximum reserve
requirement (including, without limitation, any basic, supplemental or emergency
reserves) in respect of eurocurrency liabilities or any similar category of
liabilities for a member bank of the Federal Reserve System in New York City.

“Event of Default” means any of the events specified in Section 10.1; provided
that any requirement for passage of time, giving of notice, or any other
condition, has been satisfied.

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

“Exchange Rate” means, on any day, with respect to any Alternative Currency, the
rate quoted by the Administrative Agent or the applicable Issuing Lender as the
spot rate for the purchase by the Administrative Agent or such Issuing Lender of
such Alternative Currency through its principal foreign exchange trading office
at approximately 11:00 a.m. on the date two Business Days prior to the date as
of which the foreign exchange computation is made.

“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, imposed (i) by the
jurisdiction (or any political subdivision thereof) under the laws of which such
Recipient is organized or in which its principal office is located or, in the
case of any Lender or Issuing Lender, in which its applicable lending office is
located or (ii) that are Other Connection Taxes, (b) in the case of a Foreign
Lender, U.S. federal withholding Taxes imposed on amounts payable to or for the
account of such Lender or Issuing Lender pursuant to a law in effect on the date
on which (i) such Issuing Lender or Lender acquires its applicable ownership
interest in the Loan or Commitment (other than pursuant to an assignment request
by the Borrower under Section 5.12(b)) or (ii) such Lender or Issuing Lender
changes its lending office, except in each case to the extent that, pursuant to
Section 5.11(a), amounts with respect to such Taxes were payable either to such
Lender’s or Issuing Lender’s assignor immediately before such Lender or Issuing
Lender became a party hereto or to such Lender or Issuing Lender immediately
before it changed its lending office, (c) Taxes attributable to such Recipient’s
failure to comply with Section 5.11(f) and (d) any U.S. federal Taxes imposed
under FATCA.

“Existing Credit Agreement” means that certain Credit Agreement, dated as of
June 12, 2007, among the Borrower, the Subsidiaries of the Borrower party
thereto, the lenders party thereto and Bank of America, N.A., as swing line
lender, issuing lender, and administrative agent (as amended, restated,
supplemented or otherwise modified prior to the Closing Date).

 

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“Existing Hedge Banks” means those Hedge Banks existing on the Closing Date and
identified on Schedule 1.1(a).

“Existing Issuing Lender” means Bank of America, N.A. in its capacity as an
issuing bank with respect to the Existing Letters of Credit, or any successor
thereto.

“Existing Letters of Credit” means those letters of credit existing, undrawn and
outstanding, on the Closing Date and identified on Schedule 1.1(b).

“Extensions of Credit” means, as to any Lender at any time, (a) an amount equal
to the sum of (i) the aggregate principal amount of all Revolving Credit Loans
made by such Lender then outstanding, (ii) such Lender’s Commitment Percentage
of the L/C Obligations then outstanding, and (iii) such Lender’s Commitment
Percentage of the Swingline Loans then outstanding, or (b) the making of any
Loan or participation in any Letter of Credit by such Lender, as the context
requires.

“Facility Cash Management Agreement” means any Cash Management Agreement that is
entered into by and between any Credit Party and any Cash Management Bank.

“Facility Hedge Agreement” means any Hedge Agreement permitted under Article IX,
in each case that is entered into by and between any Credit Party and any Hedge
Bank.

“Facility Obligations” means, collectively, (a) the Obligations and (b) all
existing or future payment and other obligations owing by any Credit Party
(i) under any Facility Hedge Agreement, (ii) under any Facility Cash Management
Agreement and (iii) to each Person entitled to indemnification pursuant to
Section 12.3(b).

“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) and any current or future
regulations or official interpretations thereof.

“FDIC” means the Federal Deposit Insurance Corporation, or any successor
thereto.

“Federal Funds Rate” means, for any day, the rate per annum equal to the
weighted average of the rates on overnight Federal funds transactions with
members of the Federal Reserve System arranged by federal funds brokers on such
day (or, if such day is not a Business Day, for the immediately preceding
Business Day), as published by the Federal Reserve Bank of New York on the
Business Day next succeeding such day, provided that if such rate is not so
published for any day which is a Business Day, the average of the quotation for
such day on such transactions received by the Administrative Agent from three
Federal Funds brokers of recognized standing selected by the Administrative
Agent.

“Fee Letter” means the separate fee letter agreement, dated March 1, 2012, among
the Borrower, the Administrative Agent and the Arranger.

“Financial Letter of Credit” means any Letter of Credit issued pursuant to this
Agreement, other than a Performance Letter of Credit. The Administrative Agent
shall determine whether any Letter of Credit constitutes a “Financial Letter of
Credit” in its reasonable discretion in consultation with the Borrower.

 

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“Fiscal Year” means the fiscal year of the Borrower, and the other Credit
Parties existing on the Closing Date, ending on December 31.

“Foreign Lender” means (a) if the Borrower is a U.S. Person, a Lender that is
not a U.S. Person, and (b) if the 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 the 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 the Issuing Lenders, such Defaulting Lender’s Commitment Percentage
of the outstanding L/C Obligations 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 the Swingline Lender, such Defaulting Lender’s Commitment Percentage
of Swingline Loans other than Swingline 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.

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

“Governmental Approvals” means all authorizations, consents, approvals, permits,
licenses and exemptions of, registrations and filings with, and reports to, all
Governmental Authorities.

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

“Guaranty Obligation” means, with respect to the Borrower and its Subsidiaries,
without duplication, any obligation, contingent or otherwise, of any such Person
pursuant to which such Person has directly or indirectly guaranteed any
Indebtedness or other obligation of any other Person and, without limiting the
generality of the foregoing, any obligation, direct or indirect, contingent or
otherwise, of any such Person (a) to purchase or pay (or advance or supply funds
for the purchase or payment of) such Indebtedness or other obligation (whether
arising by virtue

 

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of partnership arrangements, by agreement to keep well, to purchase assets,
goods, securities or services, to take-or-pay, or to maintain financial
statement condition or otherwise) or (b) entered into for the purpose of
assuring in any other manner the obligee of such Indebtedness or other
obligation of the payment thereof or to protect such obligee against loss in
respect thereof (in whole or in part); provided, that the term Guaranty
Obligation shall not include endorsements for collection or deposit in the
ordinary course of business.

“Hazardous Materials” means any substances or materials (a) which are or become
defined as hazardous wastes, hazardous substances, pollutants, contaminants,
chemical substances or mixtures or toxic substances under any Environmental Law,
(b) which are toxic, explosive, corrosive, flammable, infectious, radioactive,
carcinogenic, mutagenic or otherwise harmful to human health or the environment
and are or become regulated by any Governmental Authority, (c) the presence of
which require investigation or remediation under any Environmental Law, (d) the
discharge or emission or release of which requires a permit under any
Environmental Law or (e) which are or contain, without limitation, asbestos,
polychlorinated biphenyls, urea formaldehyde, petroleum hydrocarbons, petroleum
derived substances or waste, crude oil, natural gas or synthetic gas.

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

“Hedge Bank” means (a) any Existing Hedge Bank and (b) any Person that, at the
time it enters into a Hedge Agreement permitted under Article IX, is a Lender,
an Affiliate of a Lender, the Administrative Agent or an Affiliate of the
Administrative Agent, in its capacity as a party to such Hedge Agreement.

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

 

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“Immaterial Subsidiaries” means, at any date of determination, one or more
Subsidiaries of the Borrower which individually and in the aggregate comprise
less than 5% of (a) the consolidated total assets of the Borrower and its
Subsidiaries as set forth on the consolidated balance sheet of the Borrower as
of the most recent period for which financial statements were delivered, or were
required to be delivered, pursuant to Section 8.1 and (b) the consolidated
revenues of the Borrower and its Subsidiaries, in each case, as of the most
recent four quarter period for which financial statements were delivered, or
were required to be delivered, pursuant to Section 8.1.

“Increased Amount Date” has the meaning assigned thereto in Section 5.13.

“Incremental Lender” has the meaning assigned thereto in Section 5.13.

“Incremental Commitment Increase” and “Incremental Commitment Increases” have
the meaning assigned thereto in Section 5.13.

“Incremental Loan” has the meaning assigned thereto in Section 5.13.

“Indebtedness” means, with respect to any Person at any date and without
duplication, the sum of the following:

(a) all indebtedness for borrowed money including, but not limited to,
obligations evidenced by bonds, debentures, notes or other similar instruments
of such Person;

(b) all obligations of such Person to pay the deferred purchase price of
property or services (including, without limitation, all obligations under
earn-out agreements), except (i) trade payables incurred in the ordinary course
of such Person’s business, and (ii) liabilities associated with customer
prepayments and deposits in the ordinary course of such Person’s business;

(c) the capitalized amount of all obligations of such Person as lessee under
Capital Leases and Synthetic Leases (if such lease were accounted for as a
Capital Lease) that would appear on a balance sheet of such Person prepared in
accordance with GAAP that is attributable to the principal amount of such
obligations;

(d) all obligations of such Person under conditional sale or other title
retention agreements relating to property purchased by such Person (other than
customary reservations or retentions of title under agreements with suppliers
entered into in the ordinary course of business);

(e) all Indebtedness of any other Person secured by a Lien on any asset owned by
such Person even though such Person has not assumed or become liable for the
payment of such obligations;

(f) all obligations, contingent or otherwise, of such Person relative to the
face amount of letters of credit or bank guarantees, whether or not drawn,
including, without limitation, any Reimbursement Obligation, and banker’s
acceptances issued for the account of such Person;

 

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(g) all obligations of any such Person in respect of Disqualified Capital Stock;

(h) all net obligations of such Person under any Hedge Agreements;

(i) all Bonding Obligations; and

(j) all Guaranty Obligations of such Person with respect to any of the
foregoing.

For all purposes hereof, the Indebtedness of any Person shall include the
Indebtedness of any partnership in which such Person is a general partner,
unless such Indebtedness is expressly made non-recourse to such Person. The
amount of any net obligation under any Hedge Agreement on any date shall be
deemed to be the Hedge Termination Value thereof as of such date.

“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 the
Borrower under any Loan Documents and (b) to the extent not otherwise described
in (a), Other Taxes.

“Initial Subsidiary Guarantor” means each Domestic Subsidiary of the Borrower
listed on Schedule 1.1(c) hereto.

“Insurance and Condemnation Event” means any event that gives rise to the
receipt by any Credit Party or any of its Subsidiaries of any cash casualty
insurance proceeds or condemnation awards in respect of any Property to replace,
restore or repair, or compensate for the loss of, such Property; provided,
however, that such proceeds or awards shall not include cash receipts received
from (a) proceeds of insurance or condemnation (or payments in lieu thereof) to
the extent that such proceeds or awards are received by any Person in respect of
any third party claim against such Person and applied to pay (or to reimburse
such Person for its prior payment of) such claim and the costs and expenses of
such Person with respect thereto or (b) proceeds from awards, judgments,
settlements or other recoveries for lost profits, lost business opportunities or
incidental, consequential, exemplary, special, punitive or indirect damages
related to or arising from any such Insurance and Condemnation Event.

“Intangibles” means, for purposes of calculating Tangible Net Worth on any date
of determination (without duplication): the general intangibles; software
developed in-house or purchased, licensed or leased; accounts receivable and
advances due from officers, directors, stockholders, members, and owners;
licenses; good will; covenants not to complete; franchise fees; finance reserves
held for recourse obligations; capitalized research and development costs; and
the capitalized cost of patents, trademarks, service marks and copyrights net of
amortization, in each case, owned by the Borrower and its Subsidiaries on a
consolidated basis.

“Interest Period” has the meaning assigned thereto in Section 5.1(b).

“Investment” means, as to any Person, any direct or indirect acquisition or
investment by such Person, whether by means of (a) the purchase or other
acquisition of Capital Stock or debt or other securities of another Person,
(b) a loan, advance or capital contribution to, guaranty or assumption of debt
of, or purchase or other acquisition of any other debt or equity participation
or interest in, another Person, including any partnership or joint venture
interest in such other

 

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Person and any arrangement pursuant to which the investor incurs debt of the
type referred to in clause (j) of the definition of “Indebtedness” set forth in
this Section 1.1 in respect of such Person, or (c) the purchase or other
acquisition (in one transaction or a series of transactions) of all or
substantially all of the property and assets or business of another Person or
assets constituting a business unit, line of business or division of such
Person.

“IRS” means the United States Internal Revenue Service, or any successor
thereto.

“ISP98” means the International Standby Practices (1998 Revision, effective
January 1, 1999), International Chamber of Commerce Publication No. 590.

“Issuing Lender” means (a) with respect to (i) Letters of Credit (other than
bank guarantees) issued hereunder on or after the Closing Date, Wells Fargo or
Bank of America, N.A., in their respective capacities as issuer thereof, or any
successor thereto, or (ii) Letters of Credit constituting bank guarantees, Bank
of America, N.A. or any other Lender or Affiliate of a Lender selected by the
Borrower which agrees to be an “Issuing Lender” for such purpose; provided, that
the Borrower may designate another Lender or Affiliate of a Lender as an
“Issuing Lender” if (x) requested by the Borrower and approved by the
Administrative Agent in its discretion (which approval shall not be unreasonably
withheld or delayed) or (y) the Letter of Credit is to be issued in an
Alternative Currency not provided by Wells Fargo and, in the case of clause (x)
or (y), such Lender has consented to such designation as an Issuing Lender
(which consent may be evidenced by an electronic message from such Lender to the
Administrative Agent); provided, further, that at no time shall there be more
than two (2) “Issuing Lenders” in addition to Wells Fargo and its Affiliates,
Bank of America, N.A. and its Affiliates, and the Existing Issuing Lender; and
(b) with respect to the Existing Letters of Credit, the Existing Issuing Lender.

“L/C Commitment” means the lesser of (a) $125,000,000 and (b) the Aggregate
Commitment.

“L/C Obligations” means at any time, an amount equal to the sum of (a) the
aggregate undrawn and unexpired amount of the then outstanding Letters of Credit
and (b) the aggregate amount of drawings under Letters of Credit which have not
then been reimbursed pursuant to Section 3.5.

“L/C Participants” means the collective reference to all the Lenders other than
the Issuing Lenders.

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

“Lender Joinder Agreement” means a joinder agreement in form and substance
reasonably satisfactory to the Administrative Agent delivered in connection with
Section 5.13.

 

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“Lender-Surety Agreement” means a Lender-Surety Priority Agreement,
substantially in the form attached as Exhibit H (as the same may be amended,
restated, supplemented, modified or replaced from time to time in accordance
with the terms thereof) or such other form as may be reasonably acceptable to
the Administrative Agent and is not materially adverse to the Lenders as
compared to the terms of Exhibit H.

“Lending Office” means, with respect to any Lender, the office of such Lender
maintaining such Lender’s Extensions of Credit.

“Letter of Credit Application” means an application or reimbursement agreement,
in the form specified by the applicable Issuing Lender from time to time,
requesting such Issuing Lender to issue a Letter of Credit.

“Letter of Credit Facility” means the letter of credit and bank guarantee
facility established pursuant to Article III.

“Letters of Credit” means the collective reference to letters of credit and bank
guarantees issued pursuant to Section 3.1 and the Existing Letters of Credit.

“LIBOR” means:

(a) for any interest rate calculation with respect to a LIBOR Rate Loan, the
rate of interest per annum determined on the basis of the rate for deposits in
Dollars for a period equal to the applicable Interest Period which appears on
Reuters Screen LIBOR01 Page (or any applicable successor page) at approximately
11:00 a.m. (London time) two (2) Business Days prior to the first day of the
applicable Interest Period (rounded upward, if necessary, to the nearest 1/100th
of 1%). If, for any reason, such rate does not appear on Reuters Screen LIBOR01
Page (or any applicable successor page), then “LIBOR” shall be determined by the
Administrative Agent to be the arithmetic average of the rate per annum at which
deposits in Dollars in minimum amounts of at least $5,000,000 would be offered
by first class banks in the London interbank market to the Administrative Agent
at approximately 11:00 a.m. (London time) two (2) Business Days prior to the
first day of the applicable Interest Period for a period equal to such Interest
Period.

(b) for any interest rate calculation with respect to a Base Rate Loan, the rate
of interest per annum determined on the basis of the rate for deposits in
Dollars in minimum amounts of at least $5,000,000 for a period equal to one
month (commencing on the date of determination of such interest rate) which
appears on the Reuters Screen LIBOR01 Page (or any applicable successor page) at
approximately 11:00 a.m. (London time) on such date of determination, or, if
such date is not a Business Day, then the immediately preceding Business Day
(rounded upward, if necessary, to the nearest 1/100th of 1%). If, for any
reason, such rate does not appear on Reuters Screen LIBOR01 Page (or any
applicable successor page) then “LIBOR” for such Base Rate Loan shall be
determined by the Administrative Agent to be the arithmetic average of the rate
per annum at which deposits in Dollars in minimum amounts of at least $5,000,000
would be offered by first class banks in the London interbank market to the
Administrative Agent at approximately 11:00 a.m. (London time) on such date of
determination for a period equal to one month commencing on such date of
determination.

 

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Each calculation by the Administrative Agent of LIBOR shall be conclusive and
binding for all purposes, absent manifest error.

“LIBOR Rate” means a rate per annum (rounded upwards, if necessary, to the next
higher 1/100th of 1%) determined by the Administrative Agent pursuant to the
following formula:

 

LIBOR Rate =    LIBOR       1.00-Eurodollar Reserve Percentage   

“LIBOR Rate Loan” means any Loan bearing interest at a rate based upon the LIBOR
Rate as provided in Section 5.1(a).

“Lien” means, with respect to any asset, any mortgage, leasehold mortgage, lien,
pledge, charge, security interest, hypothecation or encumbrance of any kind in
respect of such asset. For the purposes of this Agreement, a Person shall be
deemed to own subject to a Lien any asset which it has acquired or holds subject
to the interest of a vendor or lessor under any conditional sale agreement,
Capital Lease or other title retention agreement relating to such asset;
provided, however, that in no event shall an Operating Lease in and of itself be
deemed a Lien regardless of GAAP treatment.

“Loan Documents” means, collectively, this Agreement, each Note, the Letter of
Credit Applications, the Subsidiary Guaranty Agreement, the Security Documents,
the Fee Letter, each Lender-Surety Agreement, the Escrow Agreement and each
other document, instrument, certificate and agreement executed and delivered by
the Credit Parties or any of their respective Subsidiaries in favor of or
provided to the Administrative Agent or any Secured Party in connection with
this Agreement (excluding any Facility Hedge Agreement and any Facility Cash
Management Agreement), all as may be amended, restated, supplemented or
otherwise modified from time to time.

“Loans” means the collective reference to the Revolving Credit Loans and the
Swingline Loans, and “Loan” means any of such Loans.

“Material Adverse Effect” means, with respect to the Borrower and its
Subsidiaries, (a) a material adverse effect on the properties, business,
operations, assets, liabilities or condition (financial or otherwise) of such
Persons, taken as a whole, (b) a material impairment of the rights and remedies
of the Administrative Agent or any Lender under any Loan Document or (c) a
material impairment of the legality, validity, binding effect or enforceability
against any Credit Party of any Loan Document to which it is a party.

“Minimum Collateral Amount” means, at any time, (i) with respect to Cash
Collateral consisting of cash or deposit account balances, an amount equal to
102% of the Fronting Exposure of all Issuing Lenders with respect to Letters of
Credit issued and outstanding at such time and (ii) otherwise, an amount
determined by the Administrative Agent and the applicable Issuing Lender in
their sole discretion.

“Moody’s” means Moody’s Investors Service, Inc. and any successor thereto.

 

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“Multiemployer Plan” means a “multiemployer plan” as defined in
Section 4001(a)(3) of ERISA to which any Credit Party or any ERISA Affiliate is
making, or is accruing an obligation to make, or has accrued an obligation to
make contributions within the preceding six (6) years.

“Net Cash Proceeds” means, as applicable, with respect to any Asset Disposition
or Insurance and Condemnation Event, the cash and Cash Equivalent proceeds
received by any Credit Party or any of its Subsidiaries therefrom (including any
cash or Cash Equivalents received by way of deferred payment pursuant to, or by
monetization of, a note receivable or otherwise, but only as and when so
received) less the sum of (i) United States federal, state, provincial, foreign
and local taxes reasonably estimated (on a Consolidated basis) to be actually
payable within the current or the immediately succeeding tax year as a result of
any gain recognized in connection therewith, (ii) all reasonable and customary
out-of-pocket fees and expenses incurred in connection with such transaction or
event, (iii) the principal amount of, premium, if any, and interest on any
Indebtedness secured by a Lien on the asset (or a portion thereof) disposed of,
which Indebtedness is required to be repaid in connection with such transaction
or event, and (iv) any reserve for adjustment in respect of (x) the sale price
of such asset or assets established in accordance with GAAP and (y) any
liabilities associated with such asset or assets and retained by the Borrower or
any of its Subsidiaries after such sale or other disposition thereof, including,
without limitation, pension and other post-employment benefit liabilities and
liabilities related to environmental matters or against any indemnification
obligations associated with such transaction; provided, however, that Net Cash
Proceeds shall exclude any cash or Cash Equivalents received by the Borrower or
any of its Subsidiaries from the sale of any assets or equity interests
(including, without limitation, by way of merger, consolidation, reorganization
or similar transaction) of any non-wholly owned Subsidiary to the extent that
(a) the Borrower or such Subsidiary is required to distribute such proceeds as
an equity distribution to the holders of such Subsidiary’s equity interests
other than the Borrower or any of its Subsidiaries (including, without
limitation, distributions of available cash flow and liquidating distributions)
pursuant to such Subsidiary’s organizational documents and (b) the aggregate
amount so excluded does not exceed 35% of the gross amount of such cash proceeds
(including the amount of cash subsequently received in respect of any non-cash
proceeds) received by the Borrower and its Subsidiaries from such sale or
similar transaction.

“Non-Consenting Lender” means any Lender that does not approve any consent,
waiver, amendment, modification or termination that (i) requires the approval of
all Lenders or all affected Lenders in accordance with the terms of Section 12.2
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-Guarantor Subsidiary” means any Subsidiary of the Borrower that is not a
Subsidiary Guarantor.

“Note Indenture” that certain Indenture, dated as of January 28, 2011, between
Wells Fargo, as trustee, and the Borrower and the Subsidiary Guarantors, as the
same may be amended, restated, supplemented or otherwise modified from time to
time.

 

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“Note Indenture Obligations” means all of (a) the Borrower’s obligations under
and with respect to the Note Indenture, including, without limitation, all
obligations to pay principal in an aggregate principal amount not to exceed
$250,000,000 under its 7-3/8% Senior Notes due 2019, and all interest, premium,
fees, charges, expenses and indemnities with respect thereto, and all
obligations to effect redemptions, repurchases and prepayments with respect
thereto, in any case, whether fixed, contingent, matured or unmatured, and
(b) the Borrower’s obligations under and with respect to such other unsecured
Indebtedness the net proceeds of which are, in whole or in part, designated to
be used, and are used reasonably promptly after the incurrence thereof, to
refinance in whole or in part the then existing Note Indenture Obligations
(including any subsequent refinancing thereof from time to time which
constitutes a Permitted Note Refinancing); provided, that (i) the aggregate
principal amount of such refinancing Indebtedness and any remaining Indebtedness
under the Note Indenture (and any Permitted Note Refinancing thereof) does not
exceed $300,000,000, (ii) immediately after giving effect to the incurrence of
such refinancing Indebtedness and the application of proceeds thereof, the
Borrower and its Subsidiaries will be in pro forma compliance (giving effect to
such refinancing as if it occurred as of the first day of the relevant period of
calculation) with each financial covenant ratio set forth in Section 9.14 as of
the most recently ended fiscal quarter for which financial statements (and the
related compliance certificate) have been delivered pursuant to Section 8.1(b)
(it being understood and agreed that the Borrower shall provide a certification
of such pro forma compliance but shall not be required to provide an Officer’s
Compliance Certificate), (iii) such refinancing Indebtedness has a final
maturity more than 180 days after the Revolving Credit Maturity Date and
requires no scheduled payment of principal in cash prior to such date, and
(iv) the terms of such refinancing Indebtedness, including the covenants, events
of default and other terms and provisions (including quantities thereof), are
reasonably acceptable to the Administrative Agent, such acceptance not to be
unreasonably withheld so long as such terms are no more restrictive, when taken
as a whole, to the Borrower and its Subsidiaries than are (x) in the case of any
public issuance (including through a 144A or other similar issuance) of
Indebtedness by the Borrower, customary at the time of such refinancing of such
type for issuers with a debt rating similar to that of the Borrower and (y) in
the case of any private issuance of Indebtedness by the Borrower, as set forth
in the Note Indenture (any such refinancing as described in this clause (b), a
“Permitted Note Refinancing”).

“Notes” means the collective reference to the Revolving Credit Notes and the
Swingline Note.

“Notice of Account Designation” has the meaning assigned thereto in
Section 2.3(b).

“Notice of Borrowing” has the meaning assigned thereto in Section 2.3(a).

“Notice of Conversion/Continuation” has the meaning assigned thereto in
Section 5.2.

“Notice of Prepayment” has the meaning assigned thereto in Section 2.4(c).

“NVDC” means the United States Coast Guard’s National Vessel Documentation
Center in Falling Waters, West Virginia.

 

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“Obligations” means, in each case, whether now in existence or hereafter
arising: (a) the principal of and interest on (including interest accruing after
the filing of any bankruptcy or similar petition) the Loans, (b) the L/C
Obligations and (c) all other fees and commissions (including attorneys’ fees),
charges, indebtedness, loans, liabilities, financial accommodations,
obligations, covenants and duties owing by the Credit Parties to the Lenders or
the Administrative Agent, in each case under any Loan Document, with respect to
any Loan or Letter of Credit of every kind, nature and description, direct or
indirect, absolute or contingent, due or to become due, contractual or tortious,
liquidated or unliquidated, and whether or not evidenced by any note and
including interest and fees that accrue after the commencement by or against any
Credit Party of any proceeding under any federal bankruptcy laws (as now or
hereafter in effect) or under any other laws, domestic or foreign, relating to
bankruptcy, insolvency, reorganization, winding up or adjustment of debts,
naming such Person as the debtor in such proceeding, regardless of whether such
interest and fees are allowed claims in such proceeding.

“OFAC” means the U.S. Department of the Treasury’s Office of Foreign Assets
Control.

“Officer’s Compliance Certificate” means a certificate of a Responsible Officer
substantially in the form attached as Exhibit F.

“OLV” has the meaning assigned thereto in Section 5.13.

“Operating Lease” means, as to any Person as determined in accordance with GAAP,
any lease of Property (whether real, personal or mixed) by such Person as lessee
which is not a Capital Lease.

“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 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 Subsidiary Guarantor” means each Domestic Subsidiary of the Borrower that
is designated by the Borrower as a Subsidiary Guarantor but is not otherwise
required to be a guarantor pursuant to the provisions of the Loan Documents and
that becomes a party to the Subsidiary Guaranty Agreement.

“Other Taxes” means all present or future stamp, court, documentary, excise,
property, 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.

“Outstandings” means the sum of (a) with respect to Revolving Credit Loans and
Swingline Loans on any date, the aggregate outstanding principal amount thereof
after giving effect to any borrowings and prepayments or repayments of Revolving
Credit Loans and Swingline Loans, as the case may be, occurring on such date;
plus (b) with respect to any L/C Obligations on any date, the aggregate
outstanding amount thereof on such date after giving

 

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effect to any Extensions of Credit occurring on such date and any other changes
in the aggregate amount of the L/C Obligations as of such date, including as a
result of any reimbursements of outstanding unpaid drawings under any Letters of
Credit or any reductions in the maximum amount available for drawing under
Letters of Credit taking effect on such date.

“Participant” has the meaning assigned thereto in Section 12.10(d).

“Participant Register” has the meaning assigned thereto in Section 12.10(e).

“PATRIOT Act” means the USA PATRIOT Act (Title III of Pub. L. 107-56 (signed
into law October 26, 2001)), as amended.

“PBGC” means the Pension Benefit Guaranty Corporation or any successor agency.

“Pension Plan” means any Employee Benefit Plan, other than a Multiemployer Plan,
which is subject to the provisions of Title IV of ERISA or Section 412 of the
Code and which (a) is maintained, funded or administered for the employees of
any Credit Party or any ERISA Affiliate or (b) has at any time within the
preceding six (6) years been maintained, funded or administered for the
employees of any Credit Party or any current or former ERISA Affiliates.

“Perfection Period” means the period (a) commencing upon the occurrence of a
Perfection Trigger Event and (b) ending on the earlier of the next Release Date,
if any, and the Springing Lien Termination Date, if any.

“Perfection Trigger Event” means, as of any date of determination:

(a) the occurrence of one or more of the following events:

(i) an Event of Default has occurred and is continuing,

(ii) the Borrower has failed to maintain a Consolidated Total Leverage Ratio
less than or equal to the Trigger Leverage Ratio as of the fiscal quarter most
recently ended prior to such date of determination, or

(iii) any Surety has perfected, or has notified the Administrative Agent of its
intention to perfect, its Liens on, or security interests in, any of the
Property that would constitute Collateral; and

(b) the delivery of a Perfection Trigger Notice to the Borrower pursuant to
clause (a) of the definition thereof with respect to such event or events, and

(c) the expiration of three (3) Business Days after the delivery of such
Perfection Trigger Notice to the Borrower pursuant to clause (a) of the
definition thereof (unless, prior to the expiration of such three-Business Day
period, such Perfection Trigger Notice has been retracted or the Perfection
Trigger Event giving rise to such Perfection Trigger Notice has been waived,
(i) in the case of the occurrence described in clause (a)(i) above, by the
Required Lenders, (ii) in the case of the occurrence described in clause (a)(ii)
above, by the Required Lenders; provided that if the Borrower’s Consolidated
Total Leverage Ratio is greater than or

 

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equal to 4.00 to 1.00 as of the fiscal quarter most recently ended, then by the
Supermajority Lenders, and (iii) in the case of the occurrence described in
clause (a)(iii) above, by the Supermajority Lenders). Notwithstanding the
foregoing, if a Perfection Trigger Event is based upon the occurrence of an
Event of Default, (x) any waiver of such Perfection Trigger Event pursuant to
the terms of this clause (c) shall not effect a waiver of such underlying Event
of Default, unless such Event of Default is also expressly waived in accordance
with Section 12.2 hereof and (y) any waiver of an Event of Default pursuant to
Section 12.2 hereof, shall not effect a waiver of the Perfection Trigger Event
arising with respect thereto pursuant to this definition, unless such Perfection
Trigger Event is also expressly waived in accordance with the foregoing
provisions of this definition.

“Perfection Trigger Notice” means (a) a written notice by the Administrative
Agent, or by the Administrative Agent at the direction of the Required Lenders,
as applicable, to the Borrower indicating that, in their sole determination (as
applicable) one or more of the events described in clauses (a)(i) through
(a)(iii) of the definition of “Perfection Trigger Event” has occurred and
(b) delivery by the Administrative Agent, or by the Administrative Agent at the
direction of the Required Lenders, as applicable, to the Escrow Agent, upon the
occurrence of a Perfection Trigger Event, of a notice in the form of Exhibit B-1
attached to the Escrow Agreement; provided, however, that the Administrative
Agent shall not, nor shall the Required Lenders direct the Administrative Agent
to, deliver any such notice based solely upon the Borrower’s non-compliance with
the financial covenants set forth in Section 9.14 or the Trigger Leverage Ratio
unless, prior to the delivery of such notice, the Borrower has (i) delivered, or
failed to timely deliver, the Officer’s Compliance Certificate required to be
delivered in connection with the financial statements corresponding to the
calculation of such financial covenants or Trigger Leverage Ratio or
(ii) acknowledged in writing that it is not in compliance with one of both of
the financial covenants set forth in Section 9.14 or the Trigger Leverage Ratio.

“Performance Letter of Credit” means any Letter of Credit issued pursuant to
this Agreement to assure completion of performance of a nonfinancial or
commercial obligation of the Borrower or any of its Subsidiaries, until such
time, if any, as such Letter of Credit is recharacterized as relating to a
financial obligation of the Borrower or such Subsidiaries. The Administrative
Agent shall determine whether any Letter of Credit constitutes a “Performance
Letter of Credit” in its reasonable discretion after consultation with the
Borrower.

“Permitted Acquisition” has the meaning assigned thereto in Section 9.3(h).

“Permitted Acquisition Documents” means with respect to any acquisition proposed
by the Borrower or any Subsidiary Guarantor, final copies of the purchase
agreement, sale agreement, merger agreement or other agreement evidencing such
acquisition, including, without limitation, all legal opinions (to the extent
permitted to be disclosed) and all other material agreements executed and
delivered in connection with such acquisition, including any material
amendments, modifications or supplements to any of the foregoing.

“Permitted Liens” means the Liens permitted pursuant to Section 9.2.

 

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“Permitted Note Refinancing” has the meaning specified in the definition of
“Note Indenture Obligations.”

“Permitted Wells Fargo Facility Collateral” means accounts receivable originated
by the Borrower or one of its Subsidiaries and arising out of the rendering of
services by the Borrower or such Subsidiary outside the United States, inventory
related to such accounts receivable, general intangibles related to such
accounts receivable and inventory, joint venture interests owned by the Borrower
or any Subsidiary with respect to joint ventures formed to render services by
the Borrower or such Subsidiary outside the United States, cash collateral
delivered pursuant to the terms of the Wells Fargo Agreement to satisfy
borrowing base shortfalls or pursuant to the remedies provisions of such
agreement, other property related to the foregoing or approved in writing by the
Administrative Agent and, if such other property constitutes or would constitute
Collateral, the Required Lenders, deposit accounts into which only proceeds of
the foregoing property are deposited, proceeds of the foregoing, and books and
records with respect to the foregoing.

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

“Platform” has the meaning assigned thereto in Section 8.2.

“Prime Rate” means, at any time, the rate of interest per annum publicly
announced from time to time by the Administrative Agent as its prime rate. Each
change in the Prime Rate shall be effective as of the opening of business on the
day such change in such prime rate occurs. The parties hereto acknowledge that
the rate announced publicly by the Administrative Agent as its prime rate is an
index or base rate and shall not necessarily be its lowest or best rate charged
to its customers or other banks.

“Pro Forma Basis” means, for purposes of calculating Consolidated EBITDA for any
period during which one or more Specified Transactions occurs, that such
Specified Transaction (and all other Specified Transactions that have been
consummated during the applicable period) shall be deemed to have occurred as of
the first day of the applicable period of measurement and all income statement
items (whether positive or negative) attributable to the Property or Person
disposed of in a Specified Disposition shall be excluded and all income
statement items (whether positive or negative) attributable to the Property or
Person acquired in a Permitted Acquisition shall be included; provided that the
foregoing pro forma adjustments may be applied to any such definition, test or
financial covenant solely to the extent that such adjustments (i) are reasonably
expected to be realized within twelve (12) months of such Specified Transaction
and (ii) are calculated in a reasonable and factually supportable manner on a
basis consistent with GAAP, as certified by a Responsible Officer of the
Borrower; provided further that the foregoing pro forma adjustment may
incorporate add-backs and other adjustments permitted by this Agreement to the
extent such add-backs and adjustments are not duplicative of any amounts or
adjustments that are already included in the calculation of Consolidated EBITDA.

“Property” means any right or interest in or to property of any kind whatsoever,
whether real, personal or mixed and whether tangible or intangible, including,
without limitation, Capital Stock.

 

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“Public Lenders” has the meaning assigned thereto in Section 8.2.

“Qualified Capital Stock” means any Capital Stock that is not Disqualified
Capital Stock.

“Receivables Security Agreement” means that certain Receivables Security
Agreement, dated as of June 4, 2012, among the Borrower, the other Credit
Parties party thereto from time to time and the Administrative Agent, as
amended, restated, supplemented, replaced (including in accordance with
Section 4.3(c)) or otherwise modified from time to time.

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

“Refinancing” means the repayment in full of the Borrower’s obligations under
and with respect to the Existing Credit Agreement, and the termination of all
credit facilities and commitments, if any, with respect thereto and all
guarantees, liens, security interests and other security granted in connection
therewith.

“Register” has the meaning assigned thereto in Section 12.10(c).

“Reimbursement Obligation” means the obligation of the Borrower to reimburse
each Issuing Lender pursuant to Section 3.5 for amounts drawn under Letters of
Credit.

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

“Release Date” has the meaning assigned thereto in Section 4.3(a).

“Relevant Transaction” has the meaning assigned thereto in Section 2.4(b)(ii).

“Replacement Escrowed Documents” has the meaning assigned thereto in
Section 4.3(c).

“Required Lenders” means, at any time, Lenders having Total Credit Exposures
representing more than 50% of the Total Credit Exposures of all Lenders. The
Total Credit Exposure of any Defaulting Lender shall be disregarded in
determining Required Lenders at any time.

“Responsible Officer” means the chief executive officer, president, chief
financial officer, controller, treasurer, assistant treasurer or similar officer
of a Credit Party and, as to any document delivered on the Closing Date, any
secretary or assistant secretary. Any document delivered hereunder or under any
other Loan Document that is signed by a Responsible Officer of a Person shall be
conclusively presumed to have been authorized by all necessary corporate,
partnership and/or other action on the part of such Person and such Responsible
Officer shall be conclusively presumed to have acted on behalf of such Person.

“Restricted Payment” has the meaning assigned thereto in Section 9.6.

 

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

“Revolving Credit Facility” means the revolving credit facility established
pursuant to Article II (including any increase in such revolving credit facility
established pursuant to Section 5.13).

“Revolving Credit Loan” means any revolving loan made to the Borrower pursuant
to Section 2.1, and all such revolving loans collectively as the context
requires.

“Revolving Credit Maturity Date” means the earliest to occur of (a) June 2,
2017, (b) the date of termination of the Aggregate Commitment by the Borrower
pursuant to Section 2.5, or (c) the date of termination of the Aggregate
Commitment pursuant to Section 10.2(a).

“Revolving Credit Note” means a promissory note made by the Borrower in favor of
a Lender evidencing the Revolving Credit Loans made by such Lender,
substantially in the form attached as Exhibit A-1, and any amendments,
supplements and modifications thereto, any substitutes therefor, and any
replacements, restatements, renewals or extension thereof, in whole or in part.

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

“Sanctioned Country” means a country subject to a sanctions program identified
on the list maintained by OFAC and available at
http://www.treasury.gov/resource-center/sanctions/Programs/Pages/Programs.aspx,
or as otherwise published from time to time.

“Sanctioned Person” means (a) a Person named on the list of “Specially
Designated Nationals and Blocked Persons” maintained by OFAC available at
http://www.treasury.gov/resource-center/sanctions/SDN-List/Pages/default.aspx,
or as otherwise published from time to time, or (b) (i) an agency of the
government of a Sanctioned Country, (ii) an organization controlled by a
Sanctioned Country, or (iii) a person resident in a Sanctioned Country, to the
extent subject to a sanctions program administered by the U.S. Department of the
Treasury’s Office of Foreign Assets Control.

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

“Secured Parties” means, collectively, the Administrative Agent, the Lenders,
the Issuing Lenders, the Hedge Banks, the Cash Management Banks, any other
holder from time to time of any of any Facility Obligations and, in each case,
their respective successors and permitted assigns.

“Security Documents” means the collective reference to the Receivables Security
Agreement, the Ship Mortgages, and each other similar agreement, instrument or
document pursuant to which any Credit Party purports to pledge or grant upon the
occurrence of a Perfection Trigger Event a security interest in any Property
securing the Obligations in favor of the Administrative Agent, in each case, as
amended, restated, supplemented, replaced or otherwise modified from time to
time.

 

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“Ship Mortgages” means, collectively, (i) the First Preferred Fleet Mortgage of
even date herewith, as amended, restated, supplemented, replaced (including in
accordance with Section 4.3(c)) or otherwise modified from time to time,
executed and delivered by the Borrower and any other applicable Credit Party in
favor of the Administrative Agent, for the benefit of the Secured Parties,
granting, upon the occurrence of a Perfection Trigger Event, a first priority
lien on and security interest in certain United States flag vessels, (ii) the
First Preferred Fleet Mortgage of even date herewith, as amended, restated,
supplemented, replaced (including in accordance with Section 4.3(c)) or
otherwise modified from time to time, executed and delivered by the Borrower and
any other applicable Credit Party in favor of the Administrative Agent, for the
benefit of the Secured Parties, granting, upon the occurrence of a Perfection
Trigger Event, a first priority lien on and security interest in certain
Republic of the Marshall Islands flag vessels and (iii) any other first
preferred fleet or ship mortgages hereafter executed and delivered by any Credit
Party in favor of the Administrative Agent, for the benefit of the Lender
Secured Parties, in each case, in substantially the form attached as Exhibit I
or any other form reasonably acceptable to the Administrative Agent.

“Solvent” and “Solvency” mean, with respect to any Person on any date of
determination, that on such date (a) the fair value of the property of such
Person is greater than the total amount of liabilities, including contingent
liabilities, of such Person determined on a going concern basis, (b) the present
fair salable value of the assets of such Person is not less than the amount that
will be required to pay the probable liability of such Person on its debts as
they become absolute and matured in the ordinary course of business, (c) such
Person does not intend to, and does not believe that it will, incur debts or
liabilities beyond such Person’s ability to pay such debts and liabilities as
they mature in the ordinary course of business, (d) such Person is not engaged
in business or a transaction, and is not about to engage in business or a
transaction, for which such Person’s property would constitute an unreasonably
small capital, and (e) such Person is able to pay its debts and liabilities,
contingent obligations and other commitments as they mature in the ordinary
course of business. The amount of contingent liabilities at any time shall be
computed as the amount that, in the light of all the facts and circumstances
existing at such time, represents the amount that can reasonably be expected to
become an actual or matured liability.

“Specified Disposition” means any disposition of all or substantially all of the
assets or Capital Stock of any Subsidiary of the Borrower or any division,
business unit, product line or line of business of the Borrower or any of its
Subsidiaries.

“Specified Transactions” means (a) any Specified Disposition and (b) any
Permitted Acquisition.

“Springing Lien Termination Date” means the date on which the Borrower has
achieved a long-term credit rating of at least BBB- from S&P and at least Baa3
from Moody’s; provided that to the extent that (a) the rating system employed by
S&P and Moody’s changes or (b) either S&P or Moody’s ceases to provide long-term
credit ratings of corporate debt obligations, the Borrower and the
Administrative Agent shall negotiate in good faith to amend the definition of
“Springing Lien Termination Date” to reflect the change in such rating system or
the unavailability of such ratings from S&P or Moody’s.

 

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“Subordinated Indebtedness” means the collective reference to any Indebtedness
incurred by the Borrower or any of its Subsidiaries that is expressly
subordinated in right and time of payment to the Obligations on terms and
conditions satisfactory to the Administrative Agent.

“Subsidiary” means as to any Person, any corporation, partnership, limited
liability company or other entity of which more than fifty percent (50%) of the
outstanding Capital Stock having ordinary voting power to elect a majority of
the board of directors (or equivalent governing body) or other managers of such
corporation, partnership, limited liability company or other entity is at the
time owned by (directly or indirectly) or the management is otherwise controlled
by (directly or indirectly) such Person (irrespective of whether, at the time,
Capital Stock of any other class or classes of such corporation, partnership,
limited liability company or other entity shall have or might have voting power
by reason of the happening of any contingency). Unless otherwise qualified,
references to “Subsidiary” or “Subsidiaries” herein shall refer to those of the
Borrower.

“Subsidiary Guarantor” means each Initial Subsidiary Guarantor, each Additional
Subsidiary Guarantor and each Other Subsidiary Guarantor; provided, however,
that the term “Subsidiary Guarantor” shall not include any such Person from and
after the date such Person ceases for any reason not otherwise prohibited by the
Loan Documents to be a party to the Subsidiary Guaranty Agreement.

“Subsidiary Guaranty Agreement” means the unconditional guaranty agreement of
even date herewith executed by the Subsidiary Guarantors in favor of the
Administrative Agent, for the ratable benefit of the Secured Parties, as
amended, restated, supplemented or otherwise modified from time to time.

“Supermajority Lenders” means, at any time, Lenders having Total Credit
Exposures representing more than 85% of the Total Credit Exposures of all
Lenders. The Total Credit Exposure of any Defaulting Lender shall be disregarded
in determining Supermajority Lenders at any time.

“Surety” means, collectively, (a) Zurich and (b) any other surety party to a
Bonding Agreement.

“Swingline Commitment” means the lesser of (a) $10,000,000 and (b) the Aggregate
Commitment.

“Swingline Facility” means the swingline facility established pursuant to
Section 2.2.

“Swingline Lender” means Wells Fargo in its capacity as swingline lender
hereunder or any successor thereto.

“Swingline Loan” means any swingline loan made by the Swingline Lender to the
Borrower pursuant to Section 2.2, and all such swingline loans collectively as
the context requires.

 

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“Swingline Note” means a promissory note made by the Borrower in favor of the
Swingline Lender evidencing the Swingline Loans made by the Swingline Lender,
substantially in the form attached as Exhibit A-2, and any amendments,
supplements and modifications thereto, any substitutes therefor, and any
replacements, restatements, renewals or extension thereof, in whole or in part.

“Synthetic Lease” means any synthetic lease, tax retention operating lease,
off-balance sheet loan or similar off-balance sheet financing product where such
transaction is considered borrowed money indebtedness for tax purposes but is
classified as an Operating Lease in accordance with GAAP.

“Tangible Net Worth” means, as of any date of determination, the Consolidated
Net Worth of the Borrower minus Intangibles.

“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, fines, additions
to tax or penalties applicable thereto.

“Termination Date” means the date upon which all Obligations (other than
contingent indemnification obligations not then due) arising under this
Agreement or any other Loan Document shall have been paid in full in cash or
other immediately available funds, all Letters of Credit have been terminated or
expired (or been Cash Collateralized) and the Aggregate Commitment has been
terminated.

“Termination Event” means the occurrence of any of the following which,
individually or in the aggregate, has resulted or would, individually or in the
aggregate, reasonably be expected to result in liability of the Borrower in an
aggregate amount in excess of the Threshold Amount: (a) a “Reportable Event”
described in Section 4043 of ERISA for which the thirty (30) day notice
requirement has not been waived by the PBGC, or (b) the withdrawal of any Credit
Party or any ERISA Affiliate from a Pension Plan during a plan year in which it
was a “substantial employer” as defined in Section 4001(a)(2) of ERISA or a
cessation of operations that is treated as such a withdrawal under
Section 4062(e) of ERISA, or (c) the termination of a Pension Plan, the filing
of a notice of intent to terminate a Pension Plan or the treatment of a Pension
Plan amendment as a termination, under Section 4041 of ERISA, if the plan assets
are not sufficient to pay all plan liabilities, or (d) the institution of
proceedings to terminate, or the appointment of a trustee with respect to, any
Pension Plan by the PBGC, or (e) any other event or condition which would
constitute grounds under Section 4042(a) of ERISA for the termination of, or the
appointment of a trustee to administer, any Pension Plan, or (f) the imposition
of a Lien pursuant to Section 430(k) of the Code or Section 303 of ERISA, or
(g) the determination that any Pension Plan or Multiemployer Plan is considered
an at-risk plan or plan in endangered or critical status with the meaning of
Sections 430, 431 or 432 of the Code or Sections 303, 304 or 305 of ERISA or
(h) the partial or complete withdrawal of any Credit Party or any ERISA
Affiliate from a Multiemployer Plan if withdrawal liability is asserted by such
plan, or (i) any event or condition which results in the reorganization or
insolvency of a Multiemployer Plan under Sections 4241 or 4245 of ERISA, or
(j) any event or condition which results in the termination of a Multiemployer
Plan under Section 4041A of ERISA or the institution by PBGC

 

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of proceedings to terminate a Multiemployer Plan under Section 4042 of ERISA, or
(k) the imposition of any liability under Title IV of ERISA, other than for PBGC
premiums due but not delinquent under Section 4007 of ERISA, upon any Credit
Party or any ERISA Affiliate.

“Threshold Amount” means $10,000,000.

“Total Credit Exposure” means, as to any Lender at any time, the unused
Commitment and Revolving Credit Exposure of such Lender at such time.

“Transaction Costs” means all fees, expenses, costs, and other amounts related
to (i) the Transactions, (ii) any amendments, consents or waivers of the Loan
Documents (including all such fees, expenses, costs and other amounts incurred
during any workout, restructuring or negotiations in respect thereof), in each
case, whether or not consummated, and (iii) any Permitted Acquisitions, whether
or not consummated (including, without limitation, any financing fees, merger
and acquisition fees, legal fees and expenses, due diligence fees, appraisal
fees or any other fees and expenses in connection therewith), in each case to
the extent paid within twelve (12) months of either the Closing Date, such
amendment, consent or waiver of the Loan Documents, or such Permitted
Acquisition, as applicable.

“Transactions” means, collectively, (a) the Refinancing, (b) the initial
Extensions of Credit, (c) the execution and delivery of the Loan Documents and
(d) the payment of the Transaction Costs incurred in connection with the
foregoing.

“Travelers” means, collectively, Travelers Casualty and Surety Company and
Travelers Casualty and Surety Company of America, together with their successors
and assigns.

“Travelers Bonding Agreement” that certain General Agreement of Indemnity, dated
as of June 4, 2012 among the Borrower and certain Subsidiaries of the Borrower
party thereto in favor of Travelers.

“Travelers’ Termination Agreement” means that certain Termination and Release
Agreement, dated as of June 4, 2012, among the Borrower, certain Subsidiaries of
the Borrower party thereto and Travelers.

“Trigger Leverage Ratio” means, with respect to the calculation of the
Consolidated Total Leverage Ratio, at any date of determination, 3.75 to 1.00.

“UCC” means the Uniform Commercial Code as in effect in the State of New York,
as amended or modified from time to time.

“Uniform Customs” means the Uniform Customs and Practice for Documentary Credits
(2007 Revision), International Chamber of Commerce Publication No. 600, and any
subsequent revision thereof adhered to by the Issuing Lender.

“United States” means the United States of America.

“URDG” means the Uniform Rules for Demand Guarantees, effective July, 2010
International Chamber of Commerce Publication No. 758.

 

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“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 5.11(f).

“Voting Stock” means securities or other equity interests of any class or
classes of a corporation, partnership, limited liability company or other
association or entity the holders of which are ordinarily, in the absence of
contingencies, entitled to elect a majority of the board of directors, managers,
general partners, managing members or Persons performing similar functions.

“Wells Fargo” means Wells Fargo Bank, National Association, a national banking
association, and its successors.

“Wells Fargo Agreement” means that certain International Letter of Credit
Agreement, dated as of September 29, 2006, among the Borrower, Great Lakes
Dredge & Dock Company, LLC, and Wells Fargo (as successor to Wells Fargo HSBC
Trade Bank, N.A.), as refinanced and replaced in whole or in part from time to
time, as permitted hereunder.

“Wells Fargo Documents” means the Wells Fargo Agreement and each of the
“International Loan Documents”, the “Borrower Agreement”, the “Fast Track
Agreement”, the “Fast Track Borrower Agreement Supplement” and the “Ex-Im Bank
Guaranty” (as such terms are defined in the Wells Fargo Agreement), in each
case, as refinanced or replaced in whole or in part from time to time, as
permitted hereunder.

“Wholly-Owned” means, with respect to a Subsidiary, that all of the shares of
Capital Stock of such Subsidiary are, directly or indirectly, owned or
controlled by the Borrower and/or one or more of its Wholly-Owned Subsidiaries
(except for directors’ qualifying shares or other shares required by Applicable
Law to be owned by a Person other than the Borrower and/or one or more of its
Wholly-Owned Subsidiaries).

“Withholding Agent” means the Borrower and the Administrative Agent.

“Yankee” means Yankee Environmental Services, LLC, a Delaware limited liability
company.

“Zurich” means, collectively, Zurich American Insurance Company and its
subsidiaries and Affiliates, including, without limitation, Fidelity and Deposit
Company of Maryland, Colonia American Casualty and Surety Company, and American
Guarantee and Liability Insurance Company, together with their successors and
assigns.

“Zurich Agreement” means, collectively, (i) that certain Agreement of Indemnity,
dated as of September 7, 2011, executed by the Borrower and the Subsidiaries of
the Borrower party there as “Contractors” and Indemnitors”, in favor of Zurich
and (ii) the Equipment Utilization Agreement, each as amended, restated,
supplemented or otherwise modified from time to time.

 

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SECTION 1.2 Other Definitions and Provisions. With reference to this Agreement
and each other Loan Document, unless otherwise specified herein or in such other
Loan Document: (a) the definitions of terms herein shall apply equally to the
singular and plural forms of the terms defined, (b) whenever the context may
require, any pronoun shall include the corresponding masculine, feminine and
neuter forms, (c) the words “include”, “includes” and “including” shall be
deemed to be followed by the phrase “without limitation”, (d) the word “will”
shall be construed to have the same meaning and effect as the word “shall”,
(e) any reference herein to any Person shall be construed to include such
Person’s successors and assigns, (f) 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, (g) 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, (h) 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,
(i) the term “documents” includes any and all instruments, documents,
agreements, certificates, notices, reports, financial statements and other
writings, however evidenced, whether in physical or electronic form, (j) in the
computation of periods of time from a specified date to a later specified date,
the word “from” means “from and including;” the words “to” and “until” each mean
“to but excluding;” and the word “through” means “to and including” and
(k) Section headings herein and in the other Loan Documents are included for
convenience of reference only and shall not affect the interpretation of this
Agreement or any other Loan Document.

SECTION 1.3 Accounting Terms. All accounting terms not specifically or
completely defined herein shall be construed in conformity with, and all
financial data (including financial ratios and other financial calculations)
required to be submitted pursuant to this Agreement shall be prepared in
conformity with GAAP, applied on a consistent basis, as in effect from time to
time and in a manner consistent with that used in preparing the audited
financial statements required by Section 8.1(a), except as otherwise
specifically prescribed herein (including, without limitation, as prescribed by
Section 12.9). Notwithstanding the foregoing, for purposes of determining
compliance with any covenant (including the computation of any financial
covenant) contained herein, Indebtedness of the Borrower and its Subsidiaries
shall be deemed to be carried at 100% of the outstanding principal amount
thereof, and the effects of FASB ASC 825 and FASB ASC 470-20 on financial
liabilities shall be disregarded.

SECTION 1.4 UCC Terms. Terms defined in the UCC in effect on the Closing Date
and not otherwise defined herein shall, unless the context otherwise indicates,
have the meanings provided by those definitions. Subject to the foregoing, the
term “UCC” refers, as of any date of determination, to the UCC then in effect.

SECTION 1.5 Rounding. Any financial ratios required to be maintained by the
Borrower pursuant to this Agreement shall be calculated by dividing the
appropriate component by the other component, carrying the result to one place
more than the number of places by which such ratio or percentage is expressed
herein and rounding the result up or down to the nearest number (with a
rounding-up if there is no nearest number).

 

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SECTION 1.6 References to Agreement and Laws. Unless otherwise expressly
provided herein, (a) references to formation documents, governing documents,
agreements (including the Loan Documents) and other contractual instruments
shall be deemed to include all subsequent amendments, restatements, extensions,
supplements and other modifications thereto, but only to the extent that such
amendments, restatements, extensions, supplements and other modifications are
not prohibited by any Loan Document; and (b) references to any Applicable Law
shall include all statutory and regulatory provisions consolidating, amending,
replacing, supplementing or interpreting such Applicable Law.

SECTION 1.7 Times of Day. Unless otherwise specified, all references herein to
times of day shall be references to Eastern time (daylight or standard, as
applicable) in the United States.

SECTION 1.8 Letter of Credit Amounts. Unless otherwise specified, all references
herein to the amount of a Letter of Credit at any time shall be deemed to mean
the maximum stated amount of such Letter of Credit after giving effect to all
increases thereof contemplated by such Letter of Credit or the Letter of Credit
Application therefor whether or not such maximum stated amount is in effect at
such time and as such amount may be reduced by (a) any permanent reduction of
such Letter of Credit or (b) any amount which is drawn, reimbursed and no longer
available under such Letter of Credit).

SECTION 1.9 Guaranty Obligations. Unless otherwise specified, the amount of any
Guaranty Obligation shall be the lessor of the principal amount of the
obligations guaranteed and still outstanding and the maximum amount for which
the guaranteeing Person may be liable pursuant to the terms of the instrument
embodying such Guaranty Obligation.

SECTION 1.10 Covenant Compliance Generally. For purposes of determining
compliance under Sections 9.1, 9.2, 9.3, 9.5 and 9.6, any amount denominated in
an Alternative Currency will be converted to the Dollar Equivalent Amount of
such amount. Notwithstanding the foregoing, for purposes of determining
compliance with Sections 9.1, 9.2 and 9.3, with respect to any amount of
Indebtedness or Investment denominated in an Alternative Currency, no breach of
any basket contained in such sections shall be deemed to have occurred solely as
a result of changes in Exchange Rates occurring after the time such Indebtedness
or Investment is incurred; provided that for the avoidance of doubt, the
foregoing provisions of this Section 1.10 shall otherwise apply to such
Sections, including with respect to determining whether any Indebtedness or
Investment may be incurred at any time under such Sections.

ARTICLE II

REVOLVING CREDIT FACILITY

SECTION 2.1 Revolving Credit Loans. Subject to the terms and conditions of this
Agreement and the other Loan Documents, and in reliance upon the representations
and warranties set forth herein, each Lender severally agrees to make Revolving
Credit Loans to the Borrower in Dollars or Alternative Currencies from time to
time from the Closing Date through, but not including, the Revolving Credit
Maturity Date as requested by the Borrower in accordance with the terms of
Section 2.3; provided, that (a) the Dollar Equivalent Amount of the Outstandings
shall not exceed the Aggregate Commitment, (b) the aggregate Dollar Equivalent
Amount of the Revolving Credit Exposure of any Lender shall not at any time
exceed such

 

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Lender’s Commitment and (c) the Dollar Equivalent Amount of all Revolving Credit
Loans denominated in Alternative Currencies shall not exceed the Alternative
Currency Loan Commitment. Each Revolving Credit Loan by a Lender shall be in a
principal amount equal to such Revolving Lender’s Commitment Percentage of the
aggregate principal amount of Revolving Credit Loans requested on such occasion.
Subject to the terms and conditions hereof, the Borrower may borrow, repay and
reborrow Revolving Credit Loans hereunder until the Revolving Credit Maturity
Date.

SECTION 2.2 Swingline Loans.

(a) Availability. Subject to the terms and conditions of this Agreement, the
Swingline Lender may in its sole discretion make Swingline Loans to the Borrower
in Dollars from time to time from the Closing Date through, but not including,
the Revolving Credit Maturity Date; provided, that (a) after giving effect to
any amount requested, the Dollar Equivalent Amount of the Outstandings shall not
exceed the Aggregate Commitment and (b) the aggregate principal amount of all
outstanding Swingline Loans (after giving effect to any amount requested), shall
not exceed the Swingline Commitment.

(b) Refunding.

(i) Swingline Loans shall be refunded by the Lenders in Dollars on demand by the
Swingline Lender (and the Swingline Lender shall demand such refunding no later
than the tenth (10th) Business Day after the date such Swingline Loan was
advanced) in accordance with their respective Commitment Percentages and shall
thereafter be reflected as Revolving Credit Loans of the Lenders on the books
and records of the Administrative Agent. Each Lender shall fund its respective
Commitment Percentage of Revolving Credit Loans as required to repay Swingline
Loans outstanding to the Swingline Lender upon demand by the Swingline Lender
but in no event later than 1:00 p.m. on the next succeeding Business Day after
such demand is made. No Lender’s obligation to fund its respective Commitment
Percentage of a Swingline Loan shall be affected by any other Lender’s failure
to fund its Commitment Percentage of a Swingline Loan, nor shall any Lender’s
Commitment Percentage be increased as a result of any such failure of any other
Lender to fund its Commitment Percentage of a Swingline Loan.

(ii) The Borrower shall pay to the Swingline Lender on demand the amount of such
Swingline Loans to the extent amounts received from the Lenders are not
sufficient to repay in full the outstanding Swingline Loans requested or
required to be refunded. In addition, the Borrower hereby authorizes the
Administrative Agent to charge any account maintained by the Borrower with the
Swingline Lender (up to the amount available therein) in order to immediately
pay the Swingline Lender the amount of such Swingline Loans to the extent
amounts received from the Lenders are not sufficient to repay in full the
outstanding Swingline Loans requested or required to be refunded. If any portion
of any such amount paid to the Swingline Lender shall be recovered by or on
behalf of the Borrower from the Swingline Lender in bankruptcy or otherwise, the
loss of the amount so recovered shall be ratably shared among all the Lenders in
accordance with their respective Commitment Percentages (unless the amounts so
recovered by or on behalf of the Borrower pertain to a Swingline Loan extended
after the occurrence and during the continuance of an Event of Default of which
the Administrative Agent has received notice in the manner required pursuant to
Section 11.3 and which such Event of Default has not been waived by the Required
Lenders or the Lenders, as applicable).

 

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(iii) Each Lender acknowledges and agrees that its obligation to refund
Swingline Loans in accordance with the terms of this Section is absolute and
unconditional and shall not be affected by any circumstance whatsoever,
including, without limitation, non-satisfaction of the conditions set forth in
Article VI. Further, each Lender agrees and acknowledges that if prior to the
refunding of any outstanding Swingline Loans pursuant to this Section, one of
the events described in Section 10.1(i) or (j) shall have occurred, each Lender
will, on the date the applicable Revolving Credit Loan would have been made,
purchase an undivided participating interest in the Swingline Loan to be
refunded in an amount equal to its Commitment Percentage of the aggregate amount
of such Swingline Loan. Each Lender will immediately transfer to the Swingline
Lender, in immediately available funds, the amount of its participation and upon
receipt thereof the Swingline Lender will deliver to such Lender a certificate
evidencing such participation dated the date of receipt of such funds and for
such amount. Whenever, at any time after the Swingline Lender has received from
any Lender such Lender’s participating interest in a Swingline Loan, the
Swingline Lender receives any payment on account thereof, the Swingline Lender
will distribute to such Lender its participating interest in such amount
(appropriately adjusted, in the case of interest payments, to reflect the period
of time during which such Lender’s participating interest was outstanding and
funded).

(c) Defaulting Lenders. Notwithstanding anything to the contrary contained in
this Agreement, this Section 2.2 shall be subject to the terms and conditions of
Section 5.14 and Section 5.15.

SECTION 2.3 Procedure for Advances of Revolving Credit Loans and Swingline
Loans.

(a) Requests for Borrowing. The Borrower shall give the Administrative Agent
irrevocable prior written notice substantially in the form of Exhibit B (a
“Notice of Borrowing”) not later than 12:00 p.m. (i) on the same Business Day as
each Base Rate Loan denominated in Dollars and each Swingline Loan, (ii) at
least three (3) Business Days before each LIBOR Rate Loan denominated in Dollars
and (iii) at least four (4) Business Days before each LIBOR Rate Loan
denominated in an Alternative Currency, of its intention to borrow, specifying
(A) the date of such borrowing, which shall be a Business Day, (B) the amount of
such borrowing, which shall be, (x) with respect to Base Rate Loans (other than
Swingline Loans) in an aggregate principal amount of $1,000,000 or a whole
multiple of $500,000 in excess thereof, (y) with respect to LIBOR Rate Loans in
an aggregate principal amount of $1,000,000 or a whole multiple of $500,000 in
excess thereof and (z) with respect to Swingline Loans in an aggregate principal
amount of $500,000 or a whole multiple of $100,000 in excess thereof,
(C) whether such Loan is to be a Revolving Credit Loan or Swingline Loan, (D) in
the case of a Revolving Credit Loan, whether the Loans are to be LIBOR Rate
Loans or Base Rate Loans, and (E) in the case of a LIBOR Rate Loan, the duration
of the Interest Period applicable thereto. A Notice of Borrowing received after
12:00 p.m. shall be deemed received on the next Business Day. The Administrative
Agent shall promptly notify the Lenders of each Notice of Borrowing.

 

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(b) Disbursement of Revolving Credit Loans and Swingline Loans. Not later than
2:00 p.m. on the proposed borrowing date, (A) each Lender will make available to
the Administrative Agent, for the account of the Borrower, at the Administrative
Agent’s Office in funds immediately available to the Administrative Agent in
Dollars or the applicable Alternative Currency, such Lender’s Commitment
Percentage of the Revolving Credit Loans to be made on such borrowing date and
(B) the Swingline Lender will make available to the Administrative Agent, for
the account of the Borrower, at the office of the Administrative Agent in funds
immediately available to the Administrative Agent in Dollars, the Swingline
Loans to be made on such borrowing date. The Borrower hereby irrevocably
authorizes the Administrative Agent to disburse the proceeds of each borrowing
requested pursuant to this Section in immediately available funds by crediting
or wiring such proceeds to the deposit account of the Borrower identified in the
most recent notice substantially in the form attached as Exhibit C (a “Notice of
Account Designation”) delivered by the Borrower to the Administrative Agent or
as may be otherwise reasonably acceptable to the Administrative Agent from time
to time. Subject to Section 5.7 hereof, the Administrative Agent shall not be
obligated to disburse the portion of the proceeds of any Revolving Credit Loan
requested pursuant to this Section to the extent that any Lender has not made
available to the Administrative Agent its Commitment Percentage of such Loan.
Revolving Credit Loans to be made for the purpose of refunding Swingline Loans
shall be made by the Lenders as provided in Section 2.2(b).

SECTION 2.4 Repayment and Prepayment of Revolving Credit Loans and Swingline
Loans.

(a) Repayment on Termination Date. The Borrower hereby agrees to repay the
outstanding principal amount of (i) all Revolving Credit Loans in full on the
Revolving Credit Maturity Date, and (ii) all Swingline Loans in accordance with
Section 2.2(b) (but, in any event, no later than the Revolving Credit Maturity
Date), together, in each case, with all accrued but unpaid interest thereon.

(b) Mandatory Prepayments.

(i) If at any time:

(A) the Dollar Equivalent Amount of the Outstandings at such time exceeds an
amount equal to 105% of Aggregate Commitment, or

(B) the Dollar Equivalent Amount of all Revolving Credit Loans denominated in
Alternative Currencies at such time exceeds an amount equal to 105% of the
Alternative Currency Loan Commitment,

the Borrower agrees to repay immediately upon notice from the Administrative
Agent, by payment to the Administrative Agent for the account of the Lenders,
Extensions of Credit in an aggregate amount sufficient to reduce the Dollar
Equivalent Amount of (x) such Outstandings as of such date of payment to an
amount not to exceed 100% of the Aggregate Commitment or (y) such Revolving
Credit Loans as of such date of payment to an amount not to exceed 100% of the
Alternative Currency Loan Commitment, in each case, with each such repayment
applied first, to the principal

 

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amount of outstanding Swingline Loans, second to the principal amount of
outstanding Revolving Credit Loans and third, if an Event of Default has
occurred and is continuing, as a payment of Cash Collateral with respect to any
Letters of Credit outstanding into a Cash Collateral account opened by the
Administrative Agent, for the benefit of the Lenders, in an amount equal to such
excess (such Cash Collateral to be applied in accordance with Section 10.2(b)).

(ii) If the Borrower or any of its Subsidiaries receives Net Cash Proceeds from
any Asset Disposition or Insurance and Condemnation Event (other than any Asset
Disposition permitted pursuant to, and in accordance with, Sections 9.5(a)
through (e)) and any such transaction results in the receipt by the Borrower and
its Subsidiaries of aggregate Net Cash Proceeds in excess of $10,000,000 in any
Fiscal Year (any such transaction or series of related transactions being a
“Relevant Transaction”), the Borrower shall (A) give written notice to the
Administrative Agent thereof promptly after the date of receipt of such Net Cash
Proceeds and (B) except to the extent the Borrower elects in such notice to
reinvest all or a portion of such Net Cash Proceeds as provided below, make
mandatory prepayments of Loans and/or Cash Collateralize L/C Obligations in the
order set forth in clause (i) above in amounts equal to 100% of all Net Cash
Proceeds received from such Relevant Transaction within five (5) Business Days
of receipt thereof by the Borrower or such Subsidiary; provided that, at the
option of the Borrower, the Borrower may reinvest all or any portion of such Net
Cash Proceeds in assets useful for its business within 365 days following
receipt of such Net Cash Proceeds (or, if the Borrower or the relevant
Subsidiary thereof, as applicable, has contractually committed in writing within
365 days following receipt of such Net Cash Proceeds to reinvest such Net Cash
Proceeds, 547 days following receipt of such Net Cash Proceeds); provided
further, that if any such Net Cash Proceeds are no longer intended to be so
reinvested at any time after the occurrence of the Relevant Transaction, an
amount equal to any such Net Cash Proceeds shall be immediately applied to the
prepayment of Loans and/or Cash Collateralize L/C Obligations in the order set
forth in clause (i) above.

(c) Optional Prepayments. The Borrower may at any time and from time to time
prepay Revolving Credit Loans and Swingline Loans, in whole or in part, with
irrevocable prior written notice to the Administrative Agent substantially in
the form attached as Exhibit D (a “Notice of Prepayment”) given not later than
12:00 p.m. (i) on the same Business Day as each Base Rate Loan and each
Swingline Loan and (ii) at least three (3) Business Days before each LIBOR Rate
Loan, specifying the date and amount of prepayment and whether the prepayment is
of LIBOR Rate Loans, Base Rate Loans, Swingline Loans or a combination thereof,
and, if of a combination thereof, the amount allocable to each. Upon receipt of
such notice, the Administrative Agent shall promptly notify each Lender. If any
such notice is given, the amount specified in such notice shall be due and
payable on the date set forth in such notice. Partial prepayments shall be in an
aggregate amount of $1,000,000 or a whole multiple of $500,000 in excess thereof
with respect to Base Rate Loans (other than Swingline Loans), $1,000,000 or a
whole multiple of $500,000 in excess thereof with respect to LIBOR Rate Loans
and $100,000 or a whole multiple of $100,000 in excess thereof with respect to
Swingline Loans. A Notice of Prepayment received after 12:00 p.m. shall be
deemed received on the next Business Day. Each such repayment shall be
accompanied by any amount required to be paid pursuant to Section 5.9 hereof.
Notwithstanding the foregoing, any Notice of a Prepayment delivered in
connection with any refinancing of all of the Revolving Credit Facility with the
proceeds of such refinancing or of any incurrence of Indebtedness, may be, if
expressly so stated to be, contingent upon the consummation of such refinancing
or incurrence and may be revoked by the Borrower in the event such refinancing
is not consummated (provided that the failure of such contingency shall not
relieve the Borrower from its obligations in respect thereof under Section 5.9).

 

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(d) Limitation on Prepayment of LIBOR Rate Loans. The Borrower may not prepay
any LIBOR Rate Loan on any day other than on the last day of the Interest Period
applicable thereto unless such prepayment is accompanied by any amount required
to be paid pursuant to Section 5.9 hereof.

SECTION 2.5 Permanent Reduction of the Aggregate Commitment.

(a) Voluntary Reduction. The Borrower shall have the right at any time and from
time to time, upon at least five (5) Business Days prior written notice to the
Administrative Agent, to permanently reduce, without premium or penalty, (i) the
Aggregate Commitment at any time or (ii) portions of the Aggregate Commitment,
from time to time, in an aggregate principal amount not less than $1,000,000 or
any whole multiple of $500,000 in excess thereof. Any reduction of the Aggregate
Commitment shall be applied to the Commitment of each Lender according to its
Commitment Percentage; provided that no such reduction, in whole or in part, of
the Aggregate Commitment shall be permitted if, after giving effect thereto and
to any prepayments of the Loans and/or deposit of Cash Collateral with the
Administrative Agent to collateralize the L/C Obligations made concurrently
pursuant to clause (b) below, the Dollar Equivalent Amount of the Outstandings
would exceed the Aggregate Commitment. All commitment fees accrued until the
effective date of any reduction, in whole or in part, of the Aggregate
Commitment shall be paid on the effective date of such termination.

(b) Corresponding Payment. Each permanent reduction permitted pursuant to this
Section shall be accompanied by a payment of principal sufficient to reduce the
aggregate outstanding Revolving Credit Loans, Swingline Loans and L/C
Obligations, as applicable, after such reduction to the Aggregate Commitment as
so reduced and if the aggregate Dollar Equivalent Amount of all outstanding
Letters of Credit exceeds the Aggregate Commitment as so reduced, the Borrower
shall be required to deposit in Dollars the Dollar Equivalent Amount of Cash
Collateral in a Cash Collateral account opened by the Administrative Agent in an
amount equal to such excess. Such Cash Collateral shall be applied in accordance
with Section 10.2(b). Any reduction of the Aggregate Commitment to zero shall be
accompanied by payment of all outstanding Obligations (and the furnishing of
Cash Collateral in an amount equal to 105% of the L/C Obligations at such time)
and shall result in the termination of the Aggregate Commitment and the
Swingline Commitment and the Revolving Credit Facility. If the reduction of the
Agreement Commitment requires the repayment of any LIBOR Rate Loan, such
repayment shall be accompanied by any amount required to be paid pursuant to
Section 5.9 hereof.

SECTION 2.6 Termination of Revolving Credit Facility. The Revolving Credit
Facility and the Aggregate Commitment shall terminate on the Revolving Credit
Maturity Date.

 

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ARTICLE III

LETTER OF CREDIT FACILITY

SECTION 3.1 L/C Commitment.

(a) Availability. Subject to the terms and conditions hereof, each Issuing
Lender, in reliance on the agreements of the other Lenders set forth in
Section 3.4(a), agrees to issue Letters of Credit for the account of the
Borrower or (without limiting the Borrower’s obligations with respect thereunder
under Section 3.5 or otherwise) any of its Subsidiaries in Dollars or in
Alternative Currencies on any Business Day from the Closing Date through but not
including the fifth (5th) Business Day prior to the Revolving Credit Maturity
Date in such form as may be approved from time to time by such Issuing Lender;
provided, however, that the applicable Issuing Lender shall have no obligation
to issue any Letter of Credit if, after giving effect to such issuance, (a) the
L/C Obligations would exceed the L/C Commitment; provided that any Issuing
Lender may issue a Letter of Credit in excess of the L/C Commitment if (x) the
term of such Letter of Credit is less than one (1) year from the date of
issuance and (y) after giving effect to such issuance, the Dollar Equivalent
Amount of the Outstandings would not exceed the Aggregate Commitment or (b) the
Dollar Equivalent Amount of the Outstandings would exceed the Aggregate
Commitment. Each Letter of Credit shall (i) be a standby letter of credit or
bank guarantee issued to support obligations of the Borrower or any of its
Subsidiaries, contingent or otherwise, (ii) expire on a date no later than the
earlier of (A) the fourth anniversary of the date of issuance and (B) June 1,
2018; provided, that (x) any Letter of Credit with a one-year term may provide
for renewal thereof for additional one-year periods (which shall in no event
extend beyond the date referred to in subclause (B) above) and (y) no later than
five (5) days prior to the Revolving Credit Maturity Date, the Borrower shall
Cash Collateralize in Dollars each Letter of Credit, if any, with an expiration
date after the Revolving Credit Maturity Date in a Dollar Equivalent Amount
equal to 105% of the L/C Obligations with respect to each such Letter of Credit
and (iii) be subject to the Uniform Customs, the URDG or ISP98, in each case, as
set forth in the related Letter of Credit Application or as determined by the
applicable Issuing Lender and, to the extent not inconsistent therewith, the
laws of the State of New York. No Issuing Lender shall at any time be obligated
to issue any Letter of Credit hereunder if such issuance would conflict with, or
cause such Issuing Lender or any L/C Participant to exceed any limits imposed
by, any Applicable Law. References herein to “issue” and derivations thereof
with respect to Letters of Credit shall also include extensions or modifications
of any outstanding Letters of Credit, except (x) any technical or
non-substantive modifications or amendments, as determined in the sole
discretion of the applicable Issuing Lender or (y) as the context may otherwise
require. As of the Closing Date, each of the Existing Letters of Credit shall
constitute, for all purposes of this Agreement and the other Loan Documents, a
Letter of Credit issued and outstanding hereunder.

(b) Defaulting Lenders. Notwithstanding anything to the contrary contained in
this Agreement, Article III shall be subject to the terms and conditions of
Section 5.14 and Section 5.15.

 

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SECTION 3.2 Procedure for Issuance of Letters of Credit. (a) The Borrower may
from time to time request that an Issuing Lender issue a Letter of Credit by
delivering to such Issuing Lender at such Issuing Lender’s address for notices
specified herein (with a copy delivered to the Administrative Agent’s Office) a
Letter of Credit Application therefor, completed to the reasonable satisfaction
of such Issuing Lender, and such other certificates, documents and other papers
and information as such Issuing Lender may reasonably request. Upon receipt of
any Letter of Credit Application, the applicable Issuing Lender shall process
such Letter of Credit Application and the certificates, documents and other
papers and information delivered to it in connection therewith in accordance
with its customary procedures and shall, subject to Section 3.1 and Article VI,
promptly issue the Letter of Credit requested thereby (but in no event shall
such Issuing Lender be required to issue any Letter of Credit earlier than three
(3) Business Days after its receipt of the Letter of Credit Application therefor
and all such other certificates, documents and other papers and information
relating thereto) by issuing the original of such Letter of Credit to the
beneficiary thereof or as otherwise may be agreed by such Issuing Lender and the
Borrower. Each Issuing Lender shall promptly furnish to the Borrower and the
Administrative Agent a copy of such Letter of Credit and the Administrative
Agent shall promptly notify each Lender of the issuance and upon request by any
Lender, furnish to such Lender a copy of such Revolving Credit Letter of Credit
and the amount of such Lender’s participation therein.

(b) Promptly after receipt of any Letter of Credit Application, the applicable
Issuing Lender will confirm with the Administrative Agent (by telephone or in
writing) that the Administrative Agent has received a copy of such Letter of
Credit Application from the Borrower and, if not, such Issuing Lender will
provide the Administrative Agent with a copy thereof. Unless the applicable
Issuing Lender has received written notice from the Administrative Agent at
least one Business Day prior to the requested date of issuance of the applicable
Letter of Credit, that one or more applicable conditions contained in Article VI
shall not then be satisfied, then, subject to the terms and conditions hereof,
such Issuing Lender shall, on the requested date, issue a Letter of Credit for
the account of the Borrower (or the applicable Subsidiary of the Borrower) in
accordance with the terms and conditions set forth herein and otherwise in
accordance with such Issuing Lender’s usual and customary business practices.

SECTION 3.3 Commissions and Other Charges.

(a) Letter of Credit Commissions. The Borrower shall pay to the Administrative
Agent, for the account of each Issuing Lender and the L/C Participants, a letter
of credit commission with respect to each Letter of Credit in the amount equal
to (i) the daily amount available to be drawn under such Letter of Credit times
(ii) the Applicable Margin applicable to Performance Letters of Credit or
Financial Letters of Credit, respectively. Such commission shall be payable
quarterly in arrears on the last Business Day of each calendar quarter, on the
Revolving Credit Maturity Date and thereafter on demand of the Administrative
Agent. The Administrative Agent shall, promptly following its receipt thereof,
distribute to each Issuing Lender and the L/C Participants all commissions
received pursuant to this Section 3.3 in accordance with their respective
Commitment Percentages.

(b) Issuance Fee. In addition to the foregoing commission, the Borrower shall
pay to each Issuing Lender, an issuance fee with respect to each Letter of
Credit issued by such Issuing Lender (i) with respect to Wells Fargo, as an
Issuing Lender, as set forth in the Fee Letter or (ii) with respect to each
other Issuing Lender, as separately agreed between the Borrower and

 

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such Issuing Lender. Such issuance fee shall be payable quarterly in arrears on
the last Business Day of each calendar quarter commencing with the first such
date to occur after the issuance of such Letter of Credit, on the Revolving
Credit Maturity Date and thereafter on demand of the Administrative Agent.

(c) Other Costs. In addition to the foregoing fees and commissions, the Borrower
shall pay or reimburse each Issuing Lender for such normal and customary costs
and expenses as are incurred or charged by such Issuing Lender in issuing,
effecting payment under, amending or otherwise administering any Letter of
Credit.

SECTION 3.4 L/C Participations.

(a) Each Issuing Lender irrevocably agrees to grant and hereby grants to each
L/C Participant, and, to induce the Issuing Lenders to issue Letters of Credit
hereunder, each L/C Participant irrevocably agrees to accept and purchase and
hereby accepts and purchases from such Issuing Lender, on the terms and
conditions hereinafter stated, for such L/C Participant’s own account and risk
an undivided interest equal to such L/C Participant’s Commitment Percentage in
such Issuing Lender’s obligations and rights under and in respect of each Letter
of Credit issued by such Issuing Lender hereunder and the amount of each draft
paid by such Issuing Lender thereunder. Each L/C Participant unconditionally and
irrevocably agrees with each Issuing Lender that, if a draft is paid under any
Letter of Credit for which such Issuing Lender is not reimbursed in full by the
Borrower through a Revolving Credit Loan or otherwise in accordance with the
terms of this Agreement, such L/C Participant shall pay in Dollars to the
Administrative Agent for the account of the applicable Issuing Lender upon
demand an amount equal to the Dollar Equivalent Amount (as determined by such
Issuing Lender) of such L/C Participant’s Commitment Percentage of the amount of
such draft, or any part thereof, which is not so reimbursed.

(b) Upon becoming aware of any amount required to be paid by any L/C Participant
to an Issuing Lender pursuant to Section 3.4(a) in respect of any unreimbursed
portion of any payment made by such Issuing Lender under any Letter of Credit
issued by such Issuing Lender, the Administrative Agent shall notify each L/C
Participant of the amount and due date of such required payment and such L/C
Participant shall pay in Dollars to such Issuing Lender the Dollar Equivalent
Amount (as determined by such Issuing Lender) of the amount specified on the
applicable due date. If any such amount is paid to the Administrative Agent for
the account of the applicable Issuing Lender after the date such payment is due,
such L/C Participant shall pay to the Administrative Agent for the account of
the applicable Issuing Lender on demand, in addition to such amount, the product
of (i) such amount, times (ii) the daily average Federal Funds Rate as
determined by the Administrative Agent during the period from and including the
date such payment is due to the date on which such payment is immediately
available to such Issuing Lender, times (iii) a fraction the numerator of which
is the number of days that elapse during such period and the denominator of
which is 360. A certificate distributed by the Administrative Agent on behalf of
the applicable Issuing Lender with respect to any amounts owing under this
Section shall be conclusive in the absence of manifest error. With respect to
payment to the applicable Issuing Lender of the unreimbursed amounts described
in this Section, if the L/C Participants receive notice that any such payment is
due (A) prior to 1:00 p.m. on any Business Day, such payment shall be due that
Business Day, and (B) after 1:00 p.m. on any Business Day, such payment shall be
due on the following Business Day.

 

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(c) Whenever, at any time after the applicable Issuing Lender has made payment
under any Letter of Credit issued by such Issuing Lender and has received from
any L/C Participant its Commitment Percentage of such payment in accordance with
this Section, such Issuing Lender receives any payment related to such Letter of
Credit (whether directly from the Borrower or otherwise), or any payment of
interest on account thereof, such Issuing Lender will distribute to such L/C
Participant its pro rata share thereof; provided, that in the event that any
such payment received by such Issuing Lender shall be required to be returned by
such Issuing Lender, such L/C Participant shall return to such Issuing Lender
the portion thereof previously distributed by such Issuing Lender to it.

SECTION 3.5 Reimbursement Obligation of the Borrower. In the event of any
drawing under any Letter of Credit, the Borrower agrees to reimburse (either
with the proceeds of a Revolving Credit Loan as provided for in this Section or
with funds from other sources), in same day funds, the applicable Issuing Lender
in Dollars (by payment to the Administrative Agent for the account of such
Issuing Lender) on each date on which such Issuing Lender notifies the Borrower
of the date and the Dollar Equivalent Amount of a draft paid under any Letter of
Credit issued by such Issuing Lender for the Dollar Equivalent Amount of
(a) such draft so paid and (b) any amounts referred to in Section 3.3(c)
incurred by such Issuing Lender in connection with such payment; provided,
however, that if such notification is delivered by such Issuing Lender after
12:00 p.m. on any date of payment, then the Borrower shall reimburse such
Issuing Lender on the next succeeding Business Day. Unless the Borrower shall
immediately notify the applicable Issuing Lender that the Borrower intends to
reimburse such Issuing Lender for such drawing from other sources or funds, the
Borrower shall be deemed to have timely given a Notice of Borrowing to the
Administrative Agent requesting that the Lenders make a Dollar-denominated
Revolving Credit Loan bearing interest at the Base Rate on such date in the
Dollar Equivalent Amount of (a) such draft so paid and (b) any amounts referred
to in Section 3.3(c) incurred by such Issuing Lender in connection with such
payment, and the Lenders shall make a Revolving Credit Loan bearing interest at
the Base Rate in such amount, the proceeds of which shall be applied to
reimburse such Issuing Lender for the amount of the related drawing and costs
and expenses. Each Lender acknowledges and agrees that its obligation to fund a
Revolving Credit Loan in accordance with this Section to reimburse the
applicable Issuing Lender for any draft paid under a Letter of Credit issued by
such Issuing Lender is absolute and unconditional and shall not be affected by
any circumstance whatsoever, including, without limitation, non-satisfaction of
the conditions set forth in Section 2.3(a) or Article VI. If the Borrower has
elected to pay the amount of such drawing with funds from other sources and
shall fail to reimburse the applicable Issuing Lender as provided above, the
unreimbursed Dollar Equivalent Amount of such drawing shall bear interest at the
rate which would be payable on any outstanding Base Rate Loans which were then
overdue from the date such amounts become payable (whether at stated maturity,
by acceleration or otherwise) until payment in full.

SECTION 3.6 Obligations Absolute. The Borrower’s obligations under this
Article III (including, without limitation, the Reimbursement Obligation) shall
be absolute and unconditional under any and all circumstances and irrespective
of any set off, counterclaim or defense to payment which the Borrower may have
or have had against any Issuing Lender or any

 

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beneficiary of a Letter of Credit or any other Person. The Borrower also agrees
that the Issuing Lenders and the L/C Participants shall not be responsible for,
and the Borrower’s Reimbursement Obligation under Section 3.5 shall not be
affected by, among other things, the validity or genuineness of documents or of
any endorsements thereon, even though such documents shall in fact prove to be
invalid, fraudulent or forged, or any dispute between or among the Borrower and
any beneficiary of any Letter of Credit or any other party to which such Letter
of Credit may be transferred or any claims whatsoever of the Borrower against
any beneficiary of such Letter of Credit or any such transferee. The Issuing
Lenders shall not be liable for any error, omission, interruption or delay in
transmission, dispatch or delivery of any message or advice, however
transmitted, in connection with any Letter of Credit, except for errors or
omissions caused by any such Issuing Lender’s gross negligence or willful
misconduct, as determined by a court of competent jurisdiction by final
nonappealable judgment. The Borrower agrees that any action taken or omitted by
any Issuing Lender under or in connection with any Letter of Credit issued by
such Issuing Lender or the related drafts or documents, if done in the absence
of gross negligence or willful misconduct shall be binding on the Borrower and
shall not result in any liability of such Issuing Lender or any L/C Participant
to the Borrower. The responsibility of each Issuing Lender to the Borrower in
connection with any draft presented for payment under any Letter of Credit
issued by such Issuing Lender shall, in addition to any payment obligation
expressly provided for in such Letter of Credit, be limited to determining that
the documents (including each draft) delivered under such Letter of Credit in
connection with such presentment are in conformity with such Letter of Credit.
Notwithstanding anything in this Section 3.6 to the contrary, the Borrower may
have a claim against such Issuing Lender, and such Issuing Lender may be liable
to the Borrower, to the extent, but only to the extent, of any direct (as
opposed to indirect, special, punitive, consequential or exemplary) damages
suffered by the Borrower which a court of competent jurisdiction determines in a
final non-appealable judgment were caused by such Issuing Lender’s gross
negligence or willful misconduct or such Issuing Lender’s bad faith or willful
or grossly negligent failure to pay under any Letter of Credit after the
presentation to it by the beneficiary of a sight draft and certificate(s)
strictly complying with the terms and conditions of a Letter of Credit.

SECTION 3.7 Effect of Letter of Credit Application. To the extent that any
provision of any Letter of Credit Application related to any Letter of Credit is
inconsistent with the provisions of this Article III, the provisions of this
Article III shall apply.

ARTICLE IV

COLLATERAL

SECTION 4.1 Perfection Trigger Event. On and after the Closing Date and on and
after each Release Date, the Obligations will be unsecured and remain unsecured
(other than with respect to Cash Collateral as provided in other Articles of
this Agreement) unless and until, subject to Section 4.3(d), a Perfection
Trigger Event occurs, upon the occurrence of which, the Obligations shall be
secured by (a) a perfected first priority Lien (or a preferred Ship Mortgage, as
the case may be) on Designated Vessels of the Borrower and the Subsidiary
Guarantors that (i) as of the Closing Date, have an OLV of at least $260,000,000
in the aggregate and (ii) as of each Increased Amount Date, have an OLV equal to
at least 1.5 times the Aggregate Commitment after giving effect to the related
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according to the appraisal performed prior to the Closing Date with respect to
any Designated Vessels covered thereby and, with respect to any other Designated
Vessels, an appraisal performed by an Approved Appraiser, (b) a perfected Lien
on all accounts receivables of the Borrower and the Subsidiary Guarantors
arising out of the rendering of services by the Borrower or any such Subsidiary
Guarantor in the United States (subject only to Permitted Liens) and (c) all
proceeds of any and all of the foregoing (clauses (a) through (c), collectively,
the “Collateral”). The Administrative Agent shall not, nor shall the Required
Lenders direct the Administrative Agent to, deliver a Perfection Trigger Notice
to the Borrower or the Escrow Agent, unless (x) one or more of the events
described in clauses (a)(i) through (a)(iii) of the definition of Perfection
Trigger Event shall have occurred and (y) if such Perfection Trigger Notice is
to be delivered solely on the basis of the event described in clause (a)(ii) of
the definition of Perfection Trigger Event, the conditions set forth in the
proviso in the definition of Perfection Trigger Notice permitting the delivery
of such notice shall have been satisfied. Upon the occurrence of a Perfection
Trigger Event and the delivery of the Escrowed Documents by the Escrow Agent to
the Administrative Agent in accordance with the terms of the Escrow Agreement,
the Administrative Agent shall take such actions as may be necessary or
advisable, in its sole determination, to perfect such Liens in the Collateral,
as soon as practicable following its receipt of the Escrowed Documents from the
Escrow Agent.

SECTION 4.2 Substitution of Collateral. The Borrower may at any time (including
prior to the commencement of a Perfection Period) provide flag vessels in
substitution (“Substituted Vessels”) for any Designated Vessel subject to, or
that may become subject to, the Lien on the Collateral granted to the
Administrative Agent, for the benefit of the Secured Parties, upon a Perfection
Trigger Event in accordance with the Security Documents; provided, that (a) the
aggregate OLV of all Designated Vessels, after giving effect to the Substituted
Vessels, is equal to at least (i) prior to the first Incremental Commitment
Increase, $260,000,000 and (ii) on and after each Incremental Commitment
Increase, 1.5 times the Aggregate Commitment, immediately after giving effect to
such Incremental Commitment Increase; provided, that the OLV of the Substituted
Vessels shall be determined by an appraisal from an Approved Appraiser conducted
within 90 days (or such earlier date as the Administrative Agent may determine
in its sole discretion) prior to the related Increased Amount Date and (b) prior
to giving effect to the substitution of Substituted Vessels, the Borrower shall
execute and deliver, or cause the other Credit Parties to execute and deliver,
Ship Mortgages and other additional Security Documents (including, without
limitation, such opinions, resolutions, certificates and other instruments
related thereto as may be reasonably requested by the Administrative Agent)
reasonably acceptable to the Administrative Agent with respect to each
Substituted Vessel to (x) at all times prior to the Springing Lien Termination
Date (other than during a Perfection Period), the Escrow Agent and (y) at all
times during a Perfection Period, the Administrative Agent.

SECTION 4.3 Release of Collateral. (a) If at any time a Perfection Trigger Event
has occurred and the Administrative Agent maintains perfected Liens in any of
the Collateral pursuant to the Security Documents, such Liens shall be (subject
to the proviso below) released and terminated on the date (a “Release Date”) on
which the Administrative Agent (in its sole determination) confirms in writing
(such written confirmation not to be unreasonably withheld or delayed) to the
Borrower, following the receipt by the Administrative Agent of a certificate
executed by the chief financial officer or treasurer of the Borrower certifying
clauses (i) and (ii) below, that:

 

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(i) No Event of Default has occurred and is continuing, and

(ii) The Borrower has maintained a Consolidated Total Leverage Ratio less than
or equal to the Trigger Leverage Ratio for the two (2) consecutive fiscal
quarters most recently ended with respect to which financial statements have
been delivered to the Lenders pursuant to Section 8.1(a) or (b) and is projected
to maintain a Consolidated Total Leverage Ratio less than or equal to the
Trigger Leverage Ratio for the next two (2) consecutive fiscal quarters;

provided, however, that the release of the Administrative Agent’s Liens on the
Collateral and the occurrence of the Release Date shall be further conditioned
upon (x) if at the time any Surety has perfected a Lien on any of the
Collateral, such Surety has terminated or, concurrently with the Administrative
Agent, will terminate such perfection or (y) if at the time no Surety has
perfected a Lien on any of the Collateral, no Surety has notified the
Administrative Agent of its intention to perfect a Lien on any of the
Collateral.

(b) As soon as practicable after the Release Date, if any, and the termination
by each Surety of the perfection of its respective Liens on the Collateral, the
Administrative Agent shall, at the sole cost and expense of the Borrower,
execute and deliver such agreements, documents and instruments, in form and
substance reasonably acceptable to the Borrower and the Administrative Agent, to
evidence and effect the release and termination of the Administrative Agent’s
Liens on the Collateral.

(c) On each Release Date occurring prior to the Springing Lien Termination Date,
the Borrower shall, and shall cause its Credit Parties to, execute and deliver
(i) to the Escrow Agent (and shall be deemed to have been delivered to the
Administrative Agent) new Security Documents, including, without limitation, new
Ship Mortgages, a new Receivables Security Agreement and all other agreements,
documents and instruments (collectively, the “Replacement Escrowed Documents”)
in a form reasonably satisfactory to the Administrative Agent to evidence each
such Credit Party’s prospective grant and perfection of Liens on the Property
that would constitute Collateral and (ii) to the Administrative Agent, all
opinions, resolutions, certificates and other instruments reasonably requested
by the Administrative Agent in connection with the delivery of the Escrowed
Documents.

(d) On and after the Springing Lien Termination Date, (i) this Article IV and
all other provisions hereunder and under the other Loan Documents relating to a
Perfection Trigger Event shall be of no further force or effect, (ii) to the
extent that the Administrative Agent has perfected its Lien on the Collateral,
all such Liens shall be released and terminated and (iii) the appointment of the
Escrow Agent and the arrangements set forth under the Escrow Agreement shall
terminate and be of no further force or effect in accordance with the terms
thereunder. The Obligations shall thereafter remain unsecured (other than with
respect to Cash Collateral that may be required pursuant to other Articles of
this Agreement). As soon as practicable after Administrative Agent receives
notice from the Borrower that the Springing Lien Termination Date has occurred,
the Administrative Agent shall, at the sole cost and expense of the Borrower,
(i) execute and deliver such agreements, documents and instruments as the
Borrower may reasonably request, in form and substance reasonably acceptable to
the Borrower and the Administrative Agent, to evidence and effect the release
and termination of the Administrative Agent’s Liens on the Collateral and to
terminate the Security Documents and (ii) execute and deliver to the Escrow
Agent, jointly with the Borrower, a notice in the form of Exhibit B-2 attached
to the Escrow Agreement.

 

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SECTION 4.4 Escrow Agent. The Borrower shall cause to be delivered to the
Administrative Agent a copy of the Escrow Agreement pursuant to which the Escrow
Agent shall deliver, notwithstanding any contrary instructions delivered by the
Borrower or any other Person, the Escrowed Documents to the Administrative Agent
within three (3) Business Days of the Escrow Agent’s receipt of a Perfection
Trigger Notice from the Administrative Agent.

SECTION 4.5 Appraisals. To the extent that no Release Date has occurred prior to
the one-year anniversary of the commencement of any Perfection Period, the
Borrower shall, upon written request of the Administrative Agent or the Required
Lenders, promptly deliver (but in no event more than 45 days (or, at the sole
discretion of the Administrative Agent, no more than 60 days) after the receipt
of the Administrative Agent’s or the Required Lender’s, as applicable, request)
to the Administrative Agent updated appraisals of the Designated Vessels from an
Approved Appraiser in similar form and scope as the appraisals delivered to the
Administrative Agent pursuant to Section 6.1(d)(iv); provided, that neither the
Administrative Agent nor the Required Lenders may request updated appraisals
more often than once during any calendar year.

SECTION 4.6 Further Assurances. (a) During each Perfection Period, the Borrower
shall maintain the security interest created by the Security Documents in
accordance with the terms thereof, subject to the rights of the Credit Parties
to dispose of the Collateral pursuant to the Loan Documents or substitute
certain Collateral pursuant to Section 4.2.

(b) (i) At all times after the Closing Date, regardless of the occurrence of any
Perfection Period, the Borrower shall, and shall cause each Credit Party to,
make, execute and deliver all such additional and further agreements,
instruments and documents as the Administrative Agent or the Required Lenders
(through the Administrative Agent) may reasonably require for the purposes of
implementing or effectuating the provisions of this Agreement and the other Loan
Documents, and (ii) at all times prior to the Springing Lien Termination Date,
the Borrower shall, and shall cause each Credit Party to, make, execute and
deliver all such additional and further agreements, instruments and documents as
the Administrative Agent or the Required Lenders (through the Administrative
Agent) may reasonably require for the purposes of renewing the rights of the
Secured Parties with respect to the Collateral pledged, or to be pledged to, the
Administrative Agent, for the ratable benefit of the Secured Parties, including,
without limitation, (A) authorizing the filing of any financing or continuation
statements under the UCC (or other similar laws) in effect in any jurisdiction
with respect to the security interests created by the Loan Documents upon the
occurrence of any Perfection Trigger Event and (B) executing amendments to the
Ship Mortgages to provide for any changes in the Applicable Law governing the
security interests in, and Liens on, any of the Designated Vessels pledged
thereunder, or to provide for any change in the nature of any of the Collateral
or Property that would constitute Collateral that may affect the creation or
perfection of any security interests or Liens of the Administrative Agent.

 

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(c) Each Credit Party agrees to take any and all actions necessary to defend
title to the Collateral or Property that would constitute Collateral against all
Persons, and at all times during a Perfection Period, to defend the security
interest of the Administrative Agent, for the benefit of the Lenders, in the
Collateral and the priority thereof against any Lien, other than Permitted
Liens.

SECTION 4.7 Collateral Covenants. At all times prior to the Springing Lien
Termination Date, each Credit Party:

(a) will not transfer or change the flag of, or change the vessel name or vessel
number of, any of the Designated Vessels without the prior written consent of
the Administrative Agent; provided, that the Administrative Agent shall not
grant any such written consent unless (i) the Administrative Agent is satisfied
that all actions necessary or desirable have been taken so that after giving
effect to the proposed transfer or change, the Ship Mortgage related to such
Designated Vessel, as modified to reflect such transfer or change, is in the
form required pursuant to Section 7.12 and benefits to the Administrative Agent
with respect to such Designated Vessel at least as favorable as those granted to
the Administrative Agent under the original Ship Mortgage or (ii) the related
Credit Party provides Substituted Vessel(s) in substitution of such Designated
Vessel that are reasonably acceptable to the Administrative Agent and have an
aggregate OLV reasonably equal to or greater than (or such lesser OLV as
reasonably acceptable to the Administrative Agent) the OLV of such Designated
Vessel; provided, further, that any such consent, once obtained shall not be
construed to be a waiver of this provision with respect to any subsequent
proposed transfer or change of flag, or change in the vessel name or vessel
number;

(b) will not (i) cause or permit any Designated Vessel to be operated in any
manner contrary to law, (ii) engage in any unlawful trade or violate any law or
expose any Designated Vessel to penalty or forfeiture, except where any such
operation, engagement, violation or exposure could not reasonably be expected to
have a Material Adverse Effect or (iii) do, or suffer or permit to be done,
anything which can or may injuriously affect, in any material respect, the
registration, documentation or trade endorsement of a Designated Vessel under
the laws and regulations of the United States, the Republic of the Marshall
Islands, or such other jurisdiction governing the documentation or registration
of such Designated Vessel;

(c) in the event that any claim or lien is asserted against any Designated
Vessel for loss, damage or expense which is covered by insurance required
hereunder, and it is necessary for such Credit Party to obtain a bond or supply
other security to prevent arrest of such Designated Vessel or to release the
Designated Vessel from arrest on account of such claim or lien, shall promptly
notify the Administrative Agent in writing of any such arrest or threatened
arrest and within thirty (30) days, cause such Designated Vessel to be released
by posting security or otherwise;

(d) will not (i) do or permit or willingly allow to be done any act to cause any
insurance required by the terms of this Agreement or any Ship Mortgage to be
suspended, impaired or cancelled, and (ii) permit or allow any Designated Vessel
to undertake any voyage or run any risk or transport any cargo or passengers
which may not be permitted by the policies in force, without having previously
insured such Designated Vessel by additional coverage extending to such voyages,
risks, passengers or cargos;

 

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(e) shall promptly notify the Administrative Agent of the actual or constructive
total loss of a Designated Vessel or the agreed or compromised total loss of a
Designated Vessel, or the arrest capture, condemnation, confiscation,
registration, seizure or forfeiture of a Designated Vessel;

(f) shall keep its chief executive office and the offices where it keeps its
records concerning the “Account Collateral” (as defined in the Receivables
Security Agreement) at the location specified in the Receivables Security
Agreement or, upon reasonable (but in any event, not less than 7 days’) prior
written notice to the Administrative Agent, at such other locations in a
jurisdiction where all action that may be reasonably necessary or desirable or
that the Administrative Agent may reasonably request in order to, upon the
occurrence of a Perfection Trigger Event, perfect and protect any security
interest granted or purported to be granted thereunder, or to enable the
Administrative Agent to exercise and enforce its rights and remedies under the
Receivables Security Agreement with respect to such Account Collateral; and

(g) except upon reasonable (but in any event, not less than 7 days’) prior
written notice to Administrative Agent, will not change its legal name or
organizational identification number, if any, or corporation, limited liability
company, partnership or other organizational structure to such an extent that
any UCC financing statement included in the Escrowed Documents in connection
with this Agreement would become seriously misleading.

ARTICLE V

GENERAL LOAN PROVISIONS

SECTION 5.1 Interest.

(a) Interest Rate Options. Subject to the provisions of this Section, at the
election of the Borrower, (i) Revolving Credit Loans shall bear interest at
(A) the Base Rate plus the Applicable Margin or (B) the LIBOR Rate plus the
Applicable Margin (provided that the LIBOR Rate shall not be available until
three (3) Business Days after the Closing Date unless the Borrower has delivered
to the Administrative Agent a letter in form and substance reasonably
satisfactory to the Administrative Agent indemnifying the Lenders in the manner
set forth in Section 5.9 of this Agreement) and (ii) any Swingline Loan shall
bear interest at the Base Rate plus the Applicable Margin. The Borrower shall
select the rate of interest and Interest Period, if any, applicable to any Loan
at the time a Notice of Borrowing is given or at the time a Notice of
Conversion/Continuation is given pursuant to Section 5.2. Any Loan or any
portion thereof as to which the Borrower has not duly specified an interest rate
as provided herein shall be deemed a Base Rate Loan.

(b) Interest Periods. In connection with each LIBOR Rate Loan, the Borrower, by
giving notice at the times described in Section 2.3 or 5.2, as applicable, shall
elect an interest period (each, an “Interest Period”) to be applicable to such
Loan, which Interest Period shall be a period of one (1), two (2), three (3), or
six (6) months or, if agreed by all of the relevant Lenders, nine (9) or twelve
(12) months; provided that:

 

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(i) the Interest Period shall commence on the date of advance of or conversion
to any LIBOR Rate Loan and, in the case of immediately successive Interest
Periods, each successive Interest Period shall commence on the date on which the
immediately preceding Interest Period expires;

(ii) if any Interest Period would otherwise expire on a day that is not a
Business Day, such Interest Period shall expire on the next succeeding Business
Day; provided, that if any Interest Period with respect to a LIBOR Rate Loan
would otherwise expire on a day that is not a Business Day but is a day of the
month after which no further Business Day occurs in such month, such Interest
Period shall expire on the immediately preceding Business Day;

(iii) any Interest Period with respect to a LIBOR Rate Loan that begins on the
last Business Day of a calendar month (or on a day for which there is no
numerically corresponding day in the calendar month at the end of such Interest
Period) shall end on the last Business Day of the relevant calendar month at the
end of such Interest Period;

(iv) no Interest Period shall extend beyond the Revolving Credit Maturity Date;
and

(v) there shall be no more than eight (8) Interest Periods in effect at any
time.

(c) Default Rate. Subject to Section 10.3, (i) immediately upon the occurrence
and during the continuance of an Event of Default under Section 10.1(a), (b),
(i) or (j), or (ii) at the election of the Required Lenders, upon the occurrence
and during the continuance of any other Event of Default, (A) the Borrower shall
no longer have the option to request LIBOR Rate Loans, Swingline Loans or
Letters of Credit, (B) all outstanding LIBOR Rate Loans shall bear interest at a
rate per annum of two percent (2%) in excess of the rate (including the
Applicable Margin) then applicable to LIBOR Rate Loans until the end of the
applicable Interest Period and thereafter at a rate equal to two percent (2%) in
excess of the rate (including the Applicable Margin) then applicable to Base
Rate Loans, (C) all outstanding Base Rate Loans and other Obligations arising
hereunder or under any other Loan Document shall bear interest at a rate per
annum equal to two percent (2%) in excess of the rate (including the Applicable
Margin) then applicable to Base Rate Loans or such other Obligations arising
hereunder or under any other Loan Document and (D) all accrued and unpaid
interest shall be due and payable on demand of the Administrative Agent.
Interest shall continue to accrue on the Obligations after the filing by or
against the Borrower of any petition seeking any relief in bankruptcy or under
any act or law pertaining to insolvency or debtor relief, whether state, federal
or foreign.

(d) Interest Payment and Computation. Interest on each Base Rate Loan shall be
due and payable in arrears on the last Business Day of each calendar quarter
commencing June 30, 2012; and interest on each LIBOR Rate Loan shall be due and
payable on the last day of each Interest Period applicable thereto, and if such
Interest Period extends over three (3) months, at the end of each three
(3) month interval during such Interest Period. All computations of interest

 

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for Base Rate Loans when the Base Rate is determined by the Prime Rate shall be
made on the basis of a year of 365 or 366 days, as the case may be, and actual
days elapsed. All other computations of fees and interest provided hereunder
shall be made on the basis of a 360-day year and actual days elapsed (which
results in more fees or interest, as applicable, being paid than if computed on
the basis of a 365/366-day year).

(e) Maximum Rate. In no contingency or event whatsoever shall the aggregate of
all amounts deemed interest under this Agreement charged or collected pursuant
to the terms of this Agreement exceed the highest rate permissible under any
Applicable Law which a court of competent jurisdiction shall, in a final
determination, deem applicable hereto. In the event that such a court determines
that the Lenders have charged or received interest hereunder in excess of the
highest applicable rate, the rate in effect hereunder shall automatically be
reduced to the maximum rate permitted by Applicable Law and the Lenders shall at
the Administrative Agent’s option (i) promptly refund to the Borrower any
interest received by the Lenders in excess of the maximum lawful rate or
(ii) apply such excess to the principal balance of the Obligations on a pro rata
basis. It is the intent hereof that the Borrower not pay or contract to pay, and
that neither the Administrative Agent nor any Lender receive or contract to
receive, directly or indirectly in any manner whatsoever, interest in excess of
that which may be paid by the Borrower under Applicable Law.

SECTION 5.2 Notice and Manner of Conversion or Continuation of Loans. Provided
that no Default or Event of Default has occurred and is then continuing, the
Borrower shall have the option to (a) convert at any time following the third
Business Day after the Closing Date all or any portion of any outstanding Base
Rate Loans (other than Swingline Loans) in a principal amount equal to
$1,000,000 or any whole multiple of $500,000 in excess thereof into one or more
LIBOR Rate Loans and (b) upon the expiration of any Interest Period, (i) convert
all or any part of its outstanding LIBOR Rate Loans in a principal amount equal
to $1,000,000 or a whole multiple of $500,000 in excess thereof into Base Rate
Loans (other than Swingline Loans) or (ii) continue such LIBOR Rate Loans as
LIBOR Rate Loans. Whenever the Borrower desires to convert or continue Loans as
provided above, the Borrower shall give the Administrative Agent irrevocable
(except as otherwise expressly provided herein) prior written notice in the form
attached as Exhibit E (a “Notice of Conversion/Continuation”) not later than
12:00 p.m. three (3) Business Days before the day on which a proposed conversion
or continuation of such Loan is to be effective specifying (A) the Loans to be
converted or continued, and, in the case of any LIBOR Rate Loan to be converted
or continued, the last day of the Interest Period therefor, (B) the effective
date of such conversion or continuation (which shall be a Business Day), (C) the
principal amount of such Loans to be converted or continued, and (D) the
Interest Period to be applicable to such converted or continued LIBOR Rate Loan.
The Administrative Agent shall promptly notify the affected Lenders of such
Notice of Conversion/Continuation. Each LIBOR Rate Loan shall automatically
convert to a Base Rate Loan at the end of the Interest Period applicable
thereto, unless the Borrower shall have delivered to the Administrative Agent a
Notice of Conversion/Continuation not less than three (3) Business Days prior to
the last day of the Interest Period applicable thereto.

 

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SECTION 5.3 Fees.

(a) Commitment Fee. Commencing on the Closing Date, the Borrower shall pay to
the Administrative Agent, for the account of the Lenders, a non-refundable
commitment fee (the “Commitment Fee”) at a rate per annum equal to the
Applicable Margin on the average daily unused portion of the Aggregate
Commitment of the Lenders (other than the Defaulting Lenders, if any); provided,
that the amount of outstanding Swingline Loans shall not be considered usage of
the Aggregate Commitment for the purpose of calculating the Commitment Fee. The
Commitment Fee shall be payable in arrears on the last Business Day of each
calendar quarter during the term of this Agreement commencing June 30, 2012 and
ending on the Revolving Credit Maturity Date. Such commitment fee shall be
distributed by the Administrative Agent to the Lenders (other than any
Defaulting Lender) pro rata in accordance with such Lenders’ respective
Commitment Percentages.

(b) Other Fees. The Borrower shall pay to the Arranger and the Administrative
Agent for their own respective accounts fees in the amounts and at the times
specified in the Fee Letter. The Borrower shall pay to the Lenders such fees as
shall have been separately agreed upon in writing in the amounts and at the
times so specified.

SECTION 5.4 Manner of Payment.

(a) Sharing of Payments. Each payment by the Borrower on account of the
principal of or interest on the Loans or of any fee, commission or other amounts
(including the Reimbursement Obligation) payable to the Lenders under this
Agreement shall be made to the Administrative Agent, for the account of the
Lenders entitled to such payment, not later than 2:00 p.m. at the Administrative
Agent’s Office on the date specified for payment under this Agreement, in
immediately available funds (i) with respect to any Revolving Credit Loan
denominated in an Alternative Currency, in the type of currency in which
Revolving Credit Loan was made or (ii) with respect to all other Extensions of
Credit, in Dollars, and shall be made without any set off, counterclaim or
deduction whatsoever. Any payment received after such time but before 3:00 p.m.
on such day shall be deemed a payment on such date for the purposes of
Section 10.1, but for all other purposes shall be deemed to have been made on
the next succeeding Business Day. Any payment received after 3:00 p.m. shall be
deemed to have been made on the next succeeding Business Day for all purposes.
Notwithstanding the foregoing provisions of this Section, if, after the making
of any Revolving Credit Loan in any Alternative Currency, the Borrower is
prohibited by any Applicable Law from making any payment required hereunder to
the Administrative Agent for the account of the Lenders in the type of currency
in which such Revolving Credit Loan was made, then all payments to be made by
the Borrower hereunder in such currency shall instead be made when due in
Dollars in an amount equal to the Dollar Equivalent Amount (as of the date of
repayment) of such payment due, it being the intention of the parties hereto
that the Borrower takes all risks of the imposition of any such Applicable Law.
Upon receipt by the Administrative Agent of each such payment, the
Administrative Agent shall distribute to each such Lender at its address for
notices set forth herein its Commitment Percentage in respect of the Revolving
Credit Facility (or other applicable share as provided herein) of such payment
and shall wire advice of the amount of such credit to each Lender. Each payment
to the Administrative Agent on account of the principal of or interest on the
Swingline Loans or of any fee, commission or other amounts payable to the
Swingline Lender shall be made in like manner, but for the account of the
Swingline Lender. Each payment to the Administrative Agent of the Issuing
Lenders fees or L/C Participants’

 

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commissions shall be made in like manner, but for the account of the applicable
Issuing Lender or the L/C Participants, as the case may be. Each payment to the
Administrative Agent of Administrative Agent’s fees or expenses shall be made
for the account of the Administrative Agent and any amount payable to any Lender
under Sections 5.9, 5.10, 5.11 or 12.3 shall be paid to the Administrative Agent
for the account of the applicable Lender. Subject to Section 5.1(b)(ii), if any
payment under this Agreement shall be specified to be made upon a day which is
not a Business Day, it shall be made on the next succeeding day which is a
Business Day and such extension of time shall in such case be included in
computing any interest if payable along with such payment.

(b) Defaulting Lenders. Notwithstanding the foregoing clause (a), if there
exists a Defaulting Lender each payment by the Borrower to such Defaulting
Lender hereunder shall be applied in accordance with Section 5.14(b).

SECTION 5.5 Evidence of Indebtedness.

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

(b) Participations. In addition to the accounts and records referred to in
clause (a), each Lender and the Administrative Agent shall maintain in
accordance with its usual practice accounts or records evidencing the purchases
and sales by such Lender of participations in Letters of Credit and Swingline
Loans. In the event of any conflict between the accounts and records maintained
by the Administrative Agent and the accounts and records of any Lender in
respect of such matters, the accounts and records of the Administrative Agent
shall control in the absence of manifest error.

SECTION 5.6 Adjustments. If any Lender shall, by exercising any right of setoff
or counterclaim or otherwise, obtain payment in respect of any principal of or
interest on any of its Loans or other obligations hereunder resulting in such
Lender’s receiving payment of a proportion of the aggregate amount of its Loans
and accrued interest thereon or other such obligations (other than pursuant to
Sections 5.9, 5.10, 5.11 or 12.3) greater than its pro rata share thereof as
provided herein, then the Lender receiving such greater proportion shall
(a) notify the

 

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Administrative 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 (A) any
payment made by the Borrower 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), (B) the application of Cash Collateral
provided for in Section 5.14 or (C) 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 Swingline Loans and Letters of Credit to any assignee
or participant, other than to the Borrower or any of its Subsidiaries (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 5.7 Obligations of Lenders.

(a) Funding by Lenders; Presumption by Administrative Agent. Unless the
Administrative Agent shall have received notice from a Lender prior to the
proposed date of any borrowing that such Lender will not make available to the
Administrative Agent such Lender’s share of such borrowing, the Administrative
Agent may assume that such Lender has made such share available on such date in
accordance with Sections 2.3(b) and 4.2 and may, in reliance upon such
assumption, make available to the Borrower a corresponding amount. In such
event, if a Lender has not in fact made its share of the applicable borrowing
available to the Administrative Agent, then the applicable Lender and the
Borrower severally agree to pay to the Administrative Agent forthwith on demand
such corresponding amount with interest thereon, for each day from and including
the date such amount is made available to the Borrower to but excluding the date
of payment to the Administrative Agent, at (A) in the case of a payment to be
made by such Lender, the greater of the daily average Federal Funds Rate and a
rate determined by the Administrative Agent in accordance with banking industry
rules on interbank compensation and (B) in the case of a payment to be made by
the Borrower, the interest rate applicable to Base Rate Loans. If the Borrower
and such Lender shall pay such interest to the Administrative Agent for the same
or an overlapping period, the Administrative Agent shall promptly remit to the
Borrower the amount of such interest paid by the Borrower for such period. If
such Lender pays its share of the applicable borrowing to the Administrative
Agent, then the amount so paid shall constitute such Lender’s Loan included in
such borrowing. Any payment by the Borrower shall be without prejudice to any
claim the Borrower may have against a Lender that shall have failed to make such
payment to the Administrative Agent.

 

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(b) Nature of Obligations of Lenders Regarding Extensions of Credit. The
obligations of the Lenders under this Agreement to make the Loans and issue or
participate in Letters of Credit are several and are neither joint nor joint and
several. The failure of any Lender to make available its Commitment Percentage
of any Loan requested by the Borrower shall not relieve it or any other Lender
of its obligation, if any, hereunder to make its Commitment Percentage of such
Loan available on the borrowing date, but no Lender shall be responsible for the
failure of any other Lender to make its Commitment Percentage of such Loan
available on the borrowing date.

SECTION 5.8 Changed Circumstances.

(a) Circumstances Affecting LIBOR Rate Availability. In connection with any
request for a LIBOR Rate Loan or a Base Rate Loan as to which the interest rate
is determined with reference to LIBOR or a conversion to or continuation
thereof, if for any reason (i) the Administrative Agent shall determine (which
determination shall be conclusive and binding absent manifest error) that Dollar
deposits are not being offered to banks in the London interbank Eurodollar
market for the applicable amount and Interest Period of such Loan, (ii) the
Administrative Agent shall determine (which determination shall be conclusive
and binding absent manifest error) that reasonable and adequate means do not
exist for the ascertaining the LIBOR Rate for such Interest Period with respect
to a proposed LIBOR Rate Loan or any Base Rate Loan as to which the interest
rate is determined with reference to LIBOR or (iii) the Required Lenders shall
determine (which determination shall be conclusive and binding absent manifest
error) that the LIBOR Rate does not adequately and fairly reflect the cost to
such Lenders of making or maintaining such Loans during such Interest Period,
then the Administrative Agent shall promptly give notice thereof to the Borrower
and each Lender. Thereafter, until the Administrative Agent notifies the
Borrower that such circumstances no longer exist, the obligation of the Lenders
to make LIBOR Rate Loans or Base Rate Loan as to which the interest rate is
determined with reference to LIBOR and the right of the Borrower to convert any
Loan to or continue any Loan as a LIBOR Rate Loan or a Base Rate Loan as to
which the interest rate is determined with reference to LIBOR shall be
suspended, and (i) in the case of LIBOR Rate Loans, the Borrower shall either
(A) repay in full (or cause to be repaid in full) the then outstanding principal
amount of each such LIBOR Rate Loan together with accrued interest thereon
(subject to Section 5.1(d)), on the last day of the then current Interest Period
applicable to such LIBOR Rate Loan; or (B) convert the then outstanding
principal amount of each such LIBOR Rate Loan to a Base Rate Loan as to which
the interest rate is not determined by reference to LIBOR as of the last day of
such Interest Period; or (ii) in the case of Base Rate Loans as to which the
interest rate is determined by reference to LIBOR, the Borrower shall convert
the then outstanding principal amount of each such Loan to a Base Rate Loan as
to which the interest rate is not determined by reference to LIBOR as of the
last day of such Interest Period. Upon receipt of such notice, the Borrower may
revoke any pending request for a borrowing of, conversion to or continuation of
LIBOR Rate Loans or, failing that, will be deemed to have converted such request
into a request for a borrowing of Base Rate Loans in the amount specified
therein

 

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(b) Laws Affecting LIBOR Rate Availability. If any Lender reasonably determines,
after the date hereof, the introduction of, or any change in, any Applicable Law
or any change in the interpretation or administration thereof by any
Governmental Authority, central bank or comparable agency charged with the
interpretation or administration thereof, or compliance by any of the Lenders
(or any of their respective Lending Offices) with any request or directive
(whether or not having the force of law) of any such Governmental Authority,
central bank or comparable agency, shall make it unlawful or impossible for any
of the Lenders (or any of their respective Lending Offices) to honor its
obligations hereunder to make or maintain any LIBOR Rate Loan or any Base Rate
Loan as to which the interest rate is determined by reference to LIBOR, such
Lender shall promptly give notice thereof to the Administrative Agent and the
Administrative Agent shall promptly give notice to the Borrower and the other
Lenders. Thereafter, until the Administrative Agent notifies the Borrower that
such Lender has reasonably determined that such circumstances no longer exist,
(i) the obligations of the Lenders to make LIBOR Rate Loans or Base Rate Loans
as to which the interest rate is determined by reference to LIBOR, and the right
of the Borrower to convert any Loan to a LIBOR Rate Loan or continue any Loan as
a LIBOR Rate Loan or a Base Rate Loan as to which the interest rate is
determined by reference to LIBOR shall be suspended and thereafter the Borrower
may select only Base Rate Loans as to which the interest rate is not determined
by reference to LIBOR hereunder, (ii) all Base Rate Loans shall cease to be
determined by reference to LIBOR and (iii) if any of the Lenders may not
lawfully continue to maintain a LIBOR Rate Loan to the end of the then current
Interest Period applicable thereto, the applicable Loan shall immediately be
converted to a Base Rate Loan as to which the interest rate is not determined by
reference to LIBOR for the remainder of such Interest Period.

SECTION 5.9 Indemnity. The Borrower hereby indemnifies each of the Lenders
against any loss or expense (including any loss or expense arising from the
liquidation or reemployment of funds obtained by it to maintain a LIBOR Rate
Loan or from fees payable to terminate the deposits from which such funds were
obtained) which may arise or be attributable to each Lender’s obtaining,
liquidating or employing deposits or other funds acquired to effect, fund or
maintain any Loan (a) as a consequence of any failure by the Borrower to make
any payment when due of any amount due hereunder in connection with a LIBOR Rate
Loan, (b) due to any failure of the Borrower (for a reason other than the
failure of a Lender to make a Loan) to borrow, continue or convert on a date
specified therefor in a Notice of Borrowing or Notice of Conversion/Continuation
or (c) due to any payment, prepayment or conversion of any LIBOR Rate Loan on a
date other than the last day of the Interest Period therefor. The amount of such
loss or expense shall be determined, in the applicable Lender’s sole discretion,
based upon the assumption that such Lender funded its Commitment Percentage of
the LIBOR Rate Loans in the London interbank market and using any reasonable
attribution or averaging methods which such Lender deems appropriate and
practical. A certificate of such Lender setting forth the basis for determining
such amount or amounts necessary to compensate such Lender shall be forwarded to
the Borrower through the Administrative Agent and shall be conclusively presumed
to be correct save for manifest error.

SECTION 5.10 Increased Costs.

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

 

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(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 advances, loans or other credit extended or
participated in by, any Lender (except any reserve requirement reflected in the
LIBOR Rate) or any Issuing Lender;

(ii) subject any Recipient to any Taxes (other than (A) Indemnified Taxes and
(B) Excluded 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 Issuing Lender 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 Issuing Lender 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, such Issuing Lender or such other Recipient hereunder (whether of
principal, interest or any other amount) then, upon receipt of written notice
from such Lender, such Issuing Lender or other Recipient, the Borrower shall
promptly pay to any such Lender, such Issuing Lender or other Recipient, as the
case may be, such additional amount or amounts as will compensate such Lender or
such Issuing Lender, as the case may be, for such additional costs incurred or
reduction suffered (it being understood that the provisions set forth in this
Section are not intended to derogate from the Borrower’s rights provided in
Section 5.12).

(b) Capital Requirements. If any Lender or any Issuing Lender determines that
any Change in Law affecting such Lender or such Issuing Lender or any lending
office of such Lender or such Lender’s or such Issuing Lender’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 such Issuing Lender’s
capital or on the capital of such Lender’s or such Issuing Lender’s holding
company, if any, as a consequence of this Agreement, the Commitment of such
Lender or the Loans made by, or participations in Letters of Credit or Swingline
Loans held by, such Lender, or the Letters of Credit issued by such Issuing
Lender, to a level below that which such Lender or such Issuing Lender or such
Lender’s or such Issuing Lender’s holding company could have achieved but for
such Change in Law (taking into consideration such Lender’s or such Issuing
Lender’s policies and the policies of such Lender’s or such Issuing Lender’s
holding company with respect to capital adequacy), then from time to time upon
written request of such Lender or such Issuing Lender, the Borrower shall
promptly pay to such Lender or such Issuing Lender, as the case may be, such
additional amount or amounts as will compensate such Lender or such Issuing
Lender or such Lender’s or such Issuing Lender’s holding company for any such
reduction suffered (it being understood that the provisions set forth in this
Section are not intended to derogate from the Borrower’s rights provided in
Section 5.12).

 

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(c) Certificates for Reimbursement. A certificate of a Lender or the applicable
Issuing Lender or Recipient setting forth the amount or amounts (together with a
description and calculation of such amounts) necessary to compensate such
Lender, Recipient or such Issuing Lender or their respective holding company, as
the case may be, as specified in clause (a) or (b) of this Section and delivered
to the Borrower, shall be conclusive absent manifest error. The Borrower shall
pay such Lender or such Issuing Lender, as the case may be, the amount shown as
due on any such certificate within fifteen (15) Business Days after receipt
thereof.

(d) Delay in Requests. Failure or delay on the part of any Lender or any Issuing
Lender to demand compensation pursuant to this Section shall not constitute a
waiver of such Lender’s or such Issuing Lender’s right to demand such
compensation; provided that the Borrower shall not be required to compensate a
Lender or any Issuing Lender pursuant to this Section for any amounts incurred
or reductions suffered more than 180 days prior to the date that such Lender or
such Issuing Lender, as the case may be, notifies the Borrower of the Change in
Law giving rise to such increased costs or reductions, and of such Lender’s or
such Issuing Lender’s intention to claim compensation therefor (except that if
the Change in Law giving rise to such increased costs or reductions is
retroactive, then the 180-day period referred to above shall be extended to
include the period of retroactive effect thereof, but in any event, shall not
extend more than 365 days prior to the date that such notice was received by the
Borrower).

SECTION 5.11 Taxes.

(a) Issuing Lender. For purposes of this Section 5.11, the term “Lender”
includes the Issuing Lenders.

(b) Payments Free of Taxes. Any and all payments by or on account of any
obligation of the Borrower 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
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 Borrower
shall be increased as necessary so that after such deduction or 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 Borrower. The Borrower shall timely pay to the
relevant Governmental Authority in accordance with applicable law, or at the
option of the Administrative Agent timely reimburse it for the payment of, any
Other Taxes which arise from any payment made hereunder or from the execution,
delivery or registration of, or otherwise with respect to, this Agreement or any
other Loan Document.

 

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(d) Indemnification by the Borrower. The Borrower shall indemnify each
Recipient, within 30 days after written 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 as to the amount
of such payment or liability, with a reasonably detailed calculation thereof,
delivered to the Borrower by a Lender (with a copy to the Administrative Agent),
or by the Administrative Agent on its own behalf or on behalf of a Lender, shall
be conclusive absent manifest error.

(e) Evidence of Payments. As soon as practicable after any payment of
Indemnified Taxes or Other Taxes by the Borrower to a Governmental Authority
pursuant to this Section 5.11, the Borrower shall deliver to the Administrative
Agent the original or a certified copy of a receipt issued by such Governmental
Authority evidencing such payment, a copy of the return reporting such payment
or other evidence of such payment reasonably satisfactory to the Administrative
Agent.

(f) 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 the Borrower and the Administrative Agent, at the time
or times reasonably requested by the Borrower or the Administrative Agent, such
properly completed and executed documentation reasonably requested by the
Borrower or the Administrative 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 the Borrower or the Administrative Agent,
shall deliver such other documentation prescribed by applicable law or
reasonably requested by the Borrower or the Administrative Agent as will enable
the Borrower or the Administrative Agent to determine whether or not such Lender
is subject to backup withholding or information reporting requirements.
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 Sections 5.11(f)(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 the
Borrower is a U.S. Borrower,

(A) any Lender that is a U.S. Person shall deliver to the Borrower and the
Administrative 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 the Borrower or the Administrative Agent), executed
originals of IRS Form W-9 certifying that such Lender is exempt from
U.S. federal backup withholding tax (and, upon request of the Borrower or the
Administrative Agent, any similar form required under any state or local law);

(B) any Foreign Lender shall, to the extent it is legally entitled to do so,
deliver to the Borrower and the Administrative Agent (in such number of copies
as shall be requested by the recipient) on or prior to the date on which such
Foreign Lender becomes a Lender under this Agreement (and from time to time
thereafter upon the reasonable request of the Borrower or the Administrative
Agent), whichever of the following is applicable:

 

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(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
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
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 (and, upon request of the Borrower or
the Administrative Agent, any similar form required under any state or local
law);

(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 J-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 the 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 Code (a “U.S. Tax Compliance Certificate”) and
(y) executed originals of IRS Form W-8BEN; 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, a
U.S. Tax Compliance Certificate substantially in the form of Exhibit J-2 or
Exhibit J-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 J-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 the Borrower and the Administrative Agent (in such number of copies
as shall be requested by the recipient) on or prior to the date on which such
Foreign Lender becomes a Lender under this Agreement (and from time to time
thereafter upon the reasonable request of the Borrower or the Administrative
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 the Borrower or the Administrative 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 the Borrower and the Administrative Agent at the time or times
prescribed by law and at such time or times reasonably

 

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requested by the Borrower or the Administrative Agent such documentation
prescribed by applicable law (including as prescribed by
Section 1471(b)(3)(C)(i) of the Code) and such additional documentation
reasonably requested by the Borrower or the Administrative Agent as may be
necessary for the Borrower and the Administrative 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 the Borrower and the Administrative
Agent in writing of its legal inability to do so.

(g) 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 5.11 (including by
the payment of additional amounts pursuant to this Section 5.11), 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 indemnification
payments or additional amounts giving rise to such refund 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.

(h) Indemnification of the Administrative Agent. Each Lender and each Issuing
Lender shall severally indemnify the Administrative Agent within ten (10) days
after demand therefor, for (i) any Indemnified Taxes attributable to such Lender
(but only to the extent that the Borrower has not already indemnified the
Administrative Agent for such Indemnified Taxes and without limiting the
obligation of the Borrower to do so), (ii) any Taxes attributable to such
Lender’s failure to comply with the provisions of Section 12.10(e) 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
Administrative Agent in connection with any Loan Document, and any reasonable
expenses arising therefrom or with respect thereto, whether or not such Taxes
were correctly or legally imposed or asserted by the relevant Governmental
Authority. A certificate as to the amount of such payment or liability delivered
to any Lender by the Administrative Agent shall be conclusive absent manifest
error. Each Lender hereby authorizes the Administrative 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 Administrative Agent to the Lender from any
other source against any amount due to the Administrative Agent under this
clause (h). The agreements in this clause (h) shall survive the resignation
and/or replacement of the Administrative Agent.

 

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(i) Survival. Each party’s obligations under this Section 5.11 shall survive the
resignation or replacement of the Administrative Agent or any assignment of
rights by, or the replacement of, a Lender, the termination of the Aggregate
Commitment and the repayment, satisfaction or discharge of all obligations under
any Loan Document.

SECTION 5.12 Mitigation Obligations; Replacement of Lenders.

(a) Designation of a Different Lending Office. If any Lender or any Issuing
Lender ceases to fund LIBOR Rate Loans (or Base Rate Loans as to which the
interest rate is determined with reference to LIBOR) as a result of a condition
described in Section 5.8, requests compensation under Section 5.10, or requires
the Borrower to pay additional amounts to any Lender, any Issuing Lender or any
Governmental Authority for the account of any Lender or any Issuing Lender
pursuant to Section 5.11, then such Lender or Issuing Lender shall, at the
request of the Borrower, use reasonable efforts to designate a different lending
office for funding, issuing or booking any Loan or Letter of Credit 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) (x) would avoid the suspension of funding such LIBOR Rate Loans
(or Base Rate Loans as to which the interest rate is determined with reference
to LIBOR) or (y) would eliminate or reduce amounts payable pursuant to
Section 5.10 or Section 5.11, as the case may be, in the future and (ii) would
not subject such Lender to any unreimbursed cost or expense and would not
otherwise be disadvantageous to such Lender. The Borrower hereby agrees 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 5.10, if the Borrower is required to pay additional amounts to any
Lender or any Governmental Authority for the account of any Lender pursuant to
Section 5.11, or any Lender ceases to fund LIBOR Rate Loans (or Base Rate Loans
as to which the interest rate is determined with reference to LIBOR) as a result
of any condition described in Section 5.8, and, in each case, such Lender has
declined or is unable to designate a different lending office in accordance with
Section 5.12(a), or if any Lender is a Defaulting Lender or a Non-Consenting
Lender, then the Borrower may, at its sole expense and effort, upon notice to
such Lender and the Administrative Agent, either (i) terminate the Commitment of
such Lender or Issuing Lender and (A) in the case of a Lender (other than an
Issuing Lender), repay all Obligations of the Borrower owing to such Lender
relating to the Loans held by, and the Commitments of, such Lender as of such
termination date and (B) in the case of an Issuing Lender, repay all Obligations
of the Borrower owing to such Issuing Lender relating to the Loans held by the
Issuing Lender as of such termination date and cancel, backstop on terms
satisfactory to such Issuing Lender or Cash Collateralize any Letters of Credit
issued by it, or (ii) require such Lender to assign and delegate, without
recourse (in accordance with and subject to the restrictions contained in, and
consents required by, Section 12.10), all of its interests, rights (other than
its existing rights to payments pursuant to Section 5.10 or 5.11) 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:

 

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(i) such Lender shall have received payment of an amount equal to the
outstanding principal of its Loans and participations in draws under Letters of
Credit which have not been reimbursed, accrued interest thereon, accrued fees
and all other amounts payable to it hereunder and under the other Loan Documents
(including any amounts under Section 5.9) from the assignee or the Borrower, as
the case may be;

(ii) in the case of any such assignment resulting from a claim for compensation
under Section 5.10 or payments required to be made pursuant to Section 5.11,
such assignment will result in a reduction in such compensation or payments
thereafter;

(iii) such assignment does not conflict with Applicable Law;

(iv) 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; and

(v) either the Borrower or the applicable assignee shall have paid any
applicable processing and recordation fee.

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 the Borrower to require such assignment and delegation
cease to apply.

SECTION 5.13 Incremental Loans. (a) At any time the Borrower may by written
notice to the Administrative Agent elect to request the establishment of one or
more increases in the Aggregate Commitment (each such increase, an “Incremental
Commitment Increase” and, all such increases, collectively, the “Incremental
Commitment Increases”) to make incremental Revolving Credit Loans (any such
incremental Revolving Credit Loan, an “Incremental Loan”); provided that (1) the
total aggregate amount for all such Incremental Commitment Increases shall not
(as of any date of incurrence thereof) exceed the amount of $50,000,000 and
(2) the total aggregate amount for each Incremental Commitment Increase (and the
Incremental Loans made thereunder) shall not be less than the amount of
$10,000,000 or, if less, the remaining amount permitted pursuant to the
foregoing clause (1). Each such notice shall specify the date (each, an
“Increased Amount Date”) on which the Borrower proposes that any Incremental
Commitment Increase shall be effective, which shall be a date not less than ten
(10) Business Days after the date on which such notice is delivered to
Administrative Agent. The Borrower may invite any Lender, any Affiliate of any
Lender and/or any Approved Fund, and/or any other Person reasonably satisfactory
to the Administrative Agent, to provide an Incremental Commitment Increase (any
such Person, an “Incremental Lender”). Any Lender or any Incremental Lender
offered or approached to provide all or a portion of any Incremental Commitment
Increase may elect or decline, in its sole discretion, to provide such
Incremental Commitment Increase. Any Incremental Commitment Increase shall
become effective as of such Increased Amount Date; provided that:

 

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(A) no Default or Event of Default shall exist on such Increased Amount Date
before or after giving effect to any Incremental Commitment Increase;

(B) the Administrative Agent and the Lenders shall have received from the
Borrower an Officer’s Compliance Certificate demonstrating that the Borrower
will be in compliance on a pro forma basis with the financial covenants set
forth in Section 9.14 both before and after giving effect to any Incremental
Commitment Increase and the making of any Incremental Loans on such Increased
Amount Date;

(C) each Incremental Commitment Increase (and the Incremental Loans made
thereunder) shall constitute Obligations of the Borrower and shall be
guaranteed, and to the extent a Perfection Trigger Event has occurred or
thereafter occurs, secured with the other Extensions of Credit on a pari passu
basis;

(D) in the case of each Incremental Commitment Increase (the terms of which
shall be set forth the relevant Lender Joinder Agreement to the extent the
Incremental Lender is not a Lender hereunder at the time of such increase):

(x) such Incremental Commitment Increase shall mature on the Revolving Credit
Maturity Date, shall bear interest at the rate applicable to the Revolving
Credit Loans and shall be subject to the same terms and conditions as the
Revolving Credit Loans; and

(y) the outstanding Revolving Credit Loans and Commitment Percentages of
Swingline Loans and L/C Obligations will be reallocated by the Administrative
Agent on the applicable Increased Amount Date among the Lenders (including the
Incremental Lenders providing such Incremental Commitment Increase) in
accordance with their revised Commitment Percentages, and the Lenders (including
the Incremental Lenders providing such Incremental Commitment Increase) agree to
make all payments and adjustments necessary to effect such reallocation and the
Borrower shall pay any and all costs required pursuant to Section 5.9 in
connection with such reallocation as if such reallocation were a repayment);

(E) any Incremental Lender providing an Incremental Commitment Increase shall be
entitled to the same voting rights as the existing Lenders under the Revolving
Credit Facility and any Extensions of Credit made in connection with each
Incremental Commitment Increase shall receive proceeds of prepayments on the
same basis as the other Revolving Credit Loans made hereunder;

 

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(F) to the extent that such Incremental Commitment Increase is being provided by
an Incremental Lender that is not a Lender hereunder at the time of such
increase, such Incremental Commitment Increase shall be effected pursuant to one
or more Lender Joinder Agreements executed and delivered by the Borrower, the
Administrative Agent and the applicable Incremental Lenders (which Lender
Joinder Agreement may, without the consent of any other Lenders, effect such
amendments to this Agreement and the other Loan Documents as may be necessary or
appropriate, in the opinion of the Administrative Agent, to effect the
provisions of this Section 5.13);

(G) the Borrower shall execute and deliver additional Ship Mortgages and related
perfection and other Security Documents (including, without limitation, such
opinions, resolutions, certificates and other instruments related thereto) as
may be reasonably requested by the Administrative Agent to (x) at all times
prior to the delivery of a Perfection Trigger Notice (so long as the Springing
Lien Termination Date has not occurred), the Escrow Agent and (y) on and after
the delivery of a Perfection Trigger Notice (but prior to a Release Date, so
long as the Springing Lien Termination Date has not occurred), the
Administrative Agent, such that the aggregate orderly liquidation value (“OLV”)
of all Designated Vessels (based on current appraisals from an Approved
Appraiser with respect to new Designated Vessels and the appraisals from an
Approved Appraiser delivered to the Administrative Agent prior to Closing Date
with respect to all other Designated Vessels) that (i) other than during a
Perfection Period, would be pledged or (ii) during a Perfection Period, have
been pledged, as applicable, to the Administrative Agent, for the benefit of the
Secured Parties, is equal to at least 1.5 times the Aggregate Commitment, after
giving effect to such Incremental Commitment Increase;

(H) the Borrower shall deliver or cause to be delivered any customary legal
opinions or other documents reasonably requested by Administrative Agent in
connection with any such transaction.

(b) The Incremental Lenders shall be included in any determination of the
Required Lenders, and the Incremental Lenders will not constitute a separate
voting class for any purposes under this Agreement.

(c) On any Increased Amount Date on which any Incremental Commitment Increase
becomes effective, subject to the foregoing terms and conditions, each
Incremental Lender providing an Incremental Commitment Increase shall become a
Lender hereunder with respect to such Incremental Commitment Increase.

SECTION 5.14 Cash Collateral. At any time that there shall exist a Defaulting
Lender, following the written request of the Administrative Agent, any Issuing
Lender or the Swingline Lender (with a copy to the Administrative Agent), the
Borrower shall promptly (but in any event, within five (5) Business Days after
the receipt of such written request) Cash Collateralize the Fronting Exposure of
such Issuing Lender and/or the Swingline Lender, as applicable, with respect to
such Defaulting Lender (determined after giving effect to Section 5.15(a)(iv)
and any Cash Collateral provided by such Defaulting Lender) in Dollars in an
amount not less than the Minimum Collateral Amount.

 

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

(b) Application. Notwithstanding anything to the contrary contained in this
Agreement, Cash Collateral provided under this Section 5.14 or Section 5.15 in
respect of Letters of Credit and Swingline Loans shall be applied to the
satisfaction of the Defaulting Lender’s obligation to fund participations in
respect of L/C Obligations and Swingline Loans (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.

(c) Termination of Requirement. Cash Collateral (or the appropriate portion
thereof) provided to reduce the Fronting Exposure of an Issuing Lender and/or
the Swingline Lender, as applicable, shall no longer be required to be held as
Cash Collateral pursuant to this Section 5.14 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
Administrative Agent, the applicable Issuing Lender and the Swingline Lender
that there exists excess Cash Collateral; provided that, subject to
Section 5.15, the Borrower, the applicable Issuing Lender and the Swingline
Lender 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 the Borrower, such Cash
Collateral shall remain subject to the security interest granted pursuant to the
Loan Documents.

SECTION 5.15 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.

 

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(ii) Defaulting Lender Waterfall. Any payment of principal, interest, fees or
other amounts received by the Administrative Agent for the account of such
Defaulting Lender (whether voluntary or mandatory, at maturity, pursuant to
Article X or otherwise) or received by the Administrative Agent from a
Defaulting Lender pursuant to Section 12.4 shall be applied at such time or
times as may be determined by the Administrative Agent as follows: first, to the
payment of any amounts owing by such Defaulting Lender to the Administrative
Agent hereunder; second, to the payment on a pro rata basis of any amounts owing
by such Defaulting Lender to the Issuing Lenders or the Swingline Lender
hereunder; third, to Cash Collateralize the Fronting Exposure of the Issuing
Lenders and the Swingline Lender with respect to such Defaulting Lender in
accordance with Section 5.14; fourth, as the Borrower may request (so long as no
Default or Event of Default exists), to the funding of any Loan or funded
participation in respect of which such Defaulting Lender has failed to fund its
portion thereof as required by this Agreement, as determined by the
Administrative Agent; fifth, if so determined by the Administrative Agent and
the Borrower, to be held in a deposit account and released pro rata in order to
(A) satisfy such Defaulting Lender’s potential future funding obligations with
respect to Loans and funded participations under this Agreement and (B) Cash
Collateralize each Issuing Lender’s future Fronting Exposure with respect to
such Defaulting Lender with respect to future Letters of Credit and Swingline
Loans issued by such Issuing Lender under this Agreement, in accordance with
Section 5.14; sixth, to the payment of any amounts owing to the Lenders, the
Issuing Lenders or the Swingline Lender as a result of any judgment of a court
of competent jurisdiction obtained by any Lender, any Issuing Lender or the
Swingline Lender 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 the
Borrower as a result of any judgment of a court of competent jurisdiction
obtained by the 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 (1) such payment is a payment of the principal
amount of any Loans or funded participations in Letters of Credit or Swingline
Loans in respect of which such Defaulting Lender has not fully funded its
appropriate share, and (2) such Loans were made or the related Letters of Credit
or Swingline Loans were issued at a time when the conditions set forth in
Section 6.2 were satisfied or waived, such payment shall be applied solely to
pay the Loans of, and funded participations in Letters of Credit or Swingline
Loans owed to, all Non-Defaulting Lenders on a pro rata basis prior to being
applied to the payment of any Loans of, or funded participations in Letters of
Credit or Swingline Loans owed to, such Defaulting Lender until such time as all
Loans and funded and unfunded participations in L/C Obligations and Swingline
Loans are held by the Lenders pro rata in accordance with the Aggregate
Commitment under the applicable Revolving Credit Facility without giving effect
to Section 5.15(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 5.15(a)(ii) shall be deemed paid to and redirected by such Defaulting
Lender, and each Lender irrevocably consents hereto.

(iii) Certain Fees.

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

 

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(B) Each Defaulting Lender shall be entitled to receive letter of credit
commissions pursuant to Section 3.3 for any period during which that Lender is a
Defaulting Lender only to the extent allocable to its Commitment Percentage of
the stated amount of Letters of Credit for which it has provided Cash Collateral
pursuant to Section 5.14.

(C) With respect to any letter of credit commission not required to be paid to
any Defaulting Lender pursuant to clause (A) or (B) above, the Borrower shall
(1) 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 or Swingline Loans that has been reallocated to
such Non-Defaulting Lender pursuant to clause (iv) below, (2) pay to each
Issuing Lender and Swingline Lender, as applicable, the amount of any such fee
otherwise payable to such Defaulting Lender to the extent allocable to such
Issuing Lender’s or Swingline Lender’s Fronting Exposure to such Defaulting
Lender, and (3) 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 Swingline Loans
shall be reallocated among the Non-Defaulting Lenders in accordance with their
respective Commitment Percentages (calculated without regard to such Defaulting
Lender’s Commitment) but only to the extent that (x) the conditions set forth in
Section 6.2 are satisfied at the time of such reallocation (and, unless the
Borrower shall have otherwise notified the Administrative Agent at such time,
the Borrower 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 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 Swingline Loans. If the reallocation described
in clause (iv) above cannot, or can only partially, be effected, the Borrower
shall, without prejudice to any right or remedy available to it hereunder or
under law, (x) first, repay Swingline Loans in an amount equal to the Swingline
Lenders’ Fronting Exposure and (y) second, Cash Collateralize each Issuing
Lender’s Fronting Exposure in accordance with the procedures set forth in
Section 5.14.

 

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(b) Defaulting Lender Cure. If the Borrower, the Administrative Agent, each
Issuing Lender and the Swingline Lender agree in writing that a Lender is no
longer a Defaulting Lender, the Administrative 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), such 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 Administrative Agent may determine to be necessary to cause the
Loans and funded and unfunded participations in Letters of Credit and Swingline
Loans to be held pro rata by the Lenders in accordance with the Aggregate
Commitment under the Revolving Credit Facility (without giving effect to
Section 5.15(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 the Borrower 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.

(c) New Swingline Loans/Letters of Credit. So long as any Lender is a Defaulting
Lender, (i) the Swingline Lender shall not be required to fund any Swingline
Loans unless it is satisfied that it will have no Fronting Exposure after giving
effect to such Swingline Loan and (ii) no Issuing Lender 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.

ARTICLE VI

CONDITIONS OF CLOSING AND BORROWING

SECTION 6.1 Conditions to Closing and Initial Extensions of Credit. The
obligations of the Lenders on the Closing Date to make the initial Loans or
issue or participate in the initial Letters of Credit, if any, is subject to the
satisfaction of each of the following conditions:

(a) Executed Loan Documents. This Agreement, a Revolving Credit Note in favor of
each Lender requesting a Revolving Credit Note, a Swingline Note in favor of the
Swingline Lender (if requested thereby), the Subsidiary Guaranty Agreement, and
the Escrow Agreement, together with each other applicable Loan Document (other
than as indicated in clauses (b) and (d) below), shall have been duly
authorized, executed and delivered to the Administrative Agent by the parties
thereto, shall be in full force and effect.

(b) Executed Security Documents. (i) The Ship Mortgages, the Receivable Security
Agreement and each other applicable Security Document (the “Closing Escrowed
Documents”) shall have been duly authorized, executed and delivered to the
Escrow Agent by the parties thereto (and thereupon shall be deemed to have been
delivered to the Administrative Agent), shall be in full force and effect
(except as otherwise provided in Section 7.3 hereof) and (ii) the Administrative
Agent shall have received a fully-executed copy of (A) the Zurich Agreement,
(B) the First Rider to General Agreement of Indemnity, dated the date hereof,
among the Borrower, the “Contractors” and “Indemnitors” party thereto and
Zurich, and (C) the Lender-Surety Agreement, dated the date hereof, between
Zurich and the Administrative Agent.

(c) Closing Certificates; Etc. The Administrative Agent shall have received each
of the following in form and substance reasonably satisfactory to the
Administrative Agent:

 

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(i) Officer’s Certificate. A certificate from a Responsible Officer of the
Borrower to the effect that (A) all representations and warranties of the Credit
Parties contained in this Agreement and the other Loan Documents are true,
correct and complete in all material respects (except to the extent any such
representation and warranty is qualified by materiality or reference to Material
Adverse Effect, in which case, such representation and warranty shall be true,
correct and complete in all respects); (B) after giving effect to the
Transactions, no Default or Event of Default has occurred and is continuing;
(C) since December 31, 2011, no event has occurred or condition arisen, either
individually or in the aggregate, that could reasonably be expected to have a
Material Adverse Effect; and (D) each of the Credit Parties, as applicable, has
satisfied each of the conditions set forth in Section 6.1 (to the extent such
condition is required to or may be satisfied by a Credit Party and is not based
upon the satisfaction of the Administrative Agent or any Lender).

(ii) Certificate of Secretary of each Credit Party. A certificate of a
Responsible Officer of each Credit Party certifying as to the incumbency and
genuineness of the signature of each officer of such Credit Party executing Loan
Documents to which it is a party and certifying that attached thereto is a true,
correct and complete copy of (A) the articles or certificate of incorporation or
formation of such Credit Party and all amendments thereto, certified as of a
recent date by the appropriate Governmental Authority in its jurisdiction of
incorporation or formation, (B) the bylaws or other governing document of such
Credit Party as in effect on the Closing Date, (C) resolutions duly adopted by
the board of directors (or other governing body) of such Credit Party
authorizing and approving the transactions contemplated hereunder and the
execution, delivery and performance of this Agreement and the other Loan
Documents to which it is a party and (D) the names, signatures, and incumbency
of the officers of each Credit Party authorized to execute the Loan Document on
behalf of such Credit Party.

(iii) Certificates of Good Standing. Certificates as of a recent date of the
good standing of each Credit Party under the laws of its jurisdiction of
organization.

(iv) Opinions of Counsel. Customary opinions of counsel to the Credit Parties
(including, without limitation, an opinion of special maritime counsel)
addressed to the Administrative Agent and the Lenders with respect to the Credit
Parties, the Loan Documents and such other matters as the Administrative Agent
may reasonably request.

(d) Personal Property Collateral.

(i) Filings and Recordings. The Escrow Agent shall have received all filings and
recordations that are necessary or reasonably requested by the Administrative
Agent to perfect or evidence the prospective security interests of the
Administrative Agent, on behalf of the Secured Parties, in the Property that
would constitute Collateral which would be effective upon the occurrence of a
Perfection Trigger Event, including, without limitation, all UCC financing
statements and Ship Mortgages in form and substance reasonably acceptable to the
Administrative Agent.

 

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(ii) Lien Searches; Designated Vessel Title Abstracts. The Administrative Agent
shall have received the results of (A) a Lien search (including a search as to
judgments, pending litigation, and tax), in form and substance reasonably
satisfactory thereto, made against the Credit Parties under the Uniform
Commercial Code (or applicable judicial docket) as in effect in each
jurisdiction in which filings or recordations under the Uniform Commercial Code
should be made to evidence or perfect the prospective security interests of the
Administrative Agent, for the benefit of the Secured Parties, in the Collateral,
indicating among other things that the Collateral to be pledged by each such
Credit Party is free and clear of any Lien (except for Permitted Liens and other
Liens that are being released in accordance with the Travelers’ Termination
Agreement or in connection with the termination of the Existing Credit
Agreement), and (B) certificates of ownership or abstracts of title issued by
the NVDC or The Marshall Islands Registry, as applicable, with respect to the
Designated Vessels which evidence that such Designated Vessels are owned by the
applicable Credit Party free and clear of any Lien, except for (x) Permitted
Liens and (y) Liens in favor of Bank of America, N.A. in connection with the
Existing Credit Agreement and Travelers, which Liens, in the case of this
subclause (y), are to be terminated prior to or in connection with the execution
of this Agreement.

(iii) Insurance. The Administrative Agent shall have received evidence of the
insurance required to be maintained pursuant to Section 8.6.

(iv) Designated Vessel Appraisals. The Administrative Agent and the Lenders
shall have received an appraisal from an Approved Appraiser of each Designated
Vessel subject to a Ship Mortgage executed on the Closing Date in form and scope
reasonably acceptable to the Administrative Agent, which appraisal valuation
provides that the Designated Vessels subject to such appraisal valuation have an
aggregate OLV in an amount equal to at least $260,000,000.

(e) Consents and Approvals.

(i) Governmental and Third Party Approvals. The Credit Parties shall have
received all material governmental, shareholder and third party consents and
approvals necessary in connection with the transactions contemplated by this
Agreement and the other Loan Documents.

(ii) No Injunction, Etc. No action, proceeding, investigation, regulation or
legislation shall have been instituted or threatened before any Governmental
Authority to enjoin, restrain, or prohibit, or to obtain substantial damages in
respect of, or which is related to or arises out of this Agreement or the other
Loan Documents or the consummation of the transactions contemplated hereby or
thereby.

(f) Financial Matters.

(i) Financial Statements. The Administrative Agent shall have received (A) the
audited Consolidated financial statements of the Borrower and its Subsidiaries
for the three (3) most recent Fiscal Years ended prior to the Closing Date as to
which such

 

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financial statements are available and (B) unaudited interim Consolidated
financial statements of the Borrower and its Subsidiaries for each fiscal
quarter ended subsequent to the date of the latest financial statements
delivered pursuant to clause (A) above as to which such financial statements are
publicly available.

(ii) Financial Projections. The Administrative Agent shall have received
Consolidated projections prepared by management of the Borrower, of balance
sheets, income statements and cash flow statements of the Borrower and its
Subsidiaries on a quarterly basis for the 2012 Fiscal Year and on an annual
basis for each year thereafter during the term of the Revolving Credit Facility,
which shall not be inconsistent in any material respect with any financial
information or projections previously delivered to the Administrative Agent.

(iii) Financial Condition/Solvency Certificate. The Borrower shall have
delivered to the Administrative Agent a certificate, in the form of Exhibit K
attached hereto, executed by the chief financial officer of the Borrower
certifying on behalf of the Borrower that (A) after giving effect to the
Transactions, the Credit Parties, on a Consolidated basis, are Solvent and
(B) after giving effect to the Transactions, the Borrower and its Subsidiaries
are in compliance with the Closing Leverage Ratio as of the Closing Date.

(iv) Closing Leverage Ratio. The Administrative Agent shall be reasonably
satisfied that the Consolidated Total Leverage Ratio of the Borrower and its
Subsidiaries as of the Closing Date, calculated on a pro forma basis (to include
the Consolidated Total Indebtedness of the Borrower and its Subsidiaries which
is outstanding as of the Closing Date after giving effect to the advance of
Loans, if any, to be made on the Closing Date), will not exceed 4.50 to 1.00
(the “Closing Leverage Ratio”).

(v) Payment at Closing. The Borrower shall have paid (A) to the Administrative
Agent and the Arranger the fees required to be paid on the Closing Date as
referenced in the Fee Letter, (B) all reasonable out-of-pocket fees and
disbursements of counsel to the Administrative Agent to the extent invoiced in
reasonable detail prior to the Closing Date (provided that such invoice and
payment shall not thereafter preclude a final settling of accounts between the
Borrower and the Administrative Agent after the Closing Date) and (C) to any
other Person such amount as may be due thereto in connection with the
transactions contemplated hereby, including all taxes, fees and other charges in
connection with the execution and delivery of any of the Loan Documents.

(g) Refinancing.

(i) Existing Credit Agreement. The Administrative Agent shall have received
evidence satisfactory to it that (A) the Existing Credit Agreement has been
terminated and cancelled and all outstanding Indebtedness thereunder shall have
been fully repaid (except with respect to the Existing Letters of Credit) and
(B) all Liens, guarantees or other credit support securing or supporting the
Existing Credit Agreement have been discharged and released.

 

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(ii) Existing Travelers Agreement. The Administrative Agent shall have received
(A) duly executed copies of that certain (1) Travelers’ Termination Agreement,
(2) Intercreditor and Proceeds Agent Termination and Release Agreement, dated as
of June 4, 2012, among the Borrower, certain Subsidiaries of the Borrower party
thereto, Travelers and Bank of America, N.A., and (3) Travelers Bonding
Agreement and (B) evidence satisfactory to it that all Liens securing that
certain Third Amended and Restated Underwriting and Continuing Indemnity
Agreement, dated as of December 22, 2003, among the Borrower, the Subsidiaries
of the Borrower party thereto from time to time as “Indemnitors” and Travelers
(as amended, restated, supplemented or otherwise modified from prior to the date
hereof) have been terminated or will be terminated upon its receipt of the
irrevocable standby letter of credit required by the Travelers’ Termination
Agreement.

(iii) Existing Hedge Agreements. The Administrative Agent shall have received
duly executed copies of amendments to each Hedge Agreement entered into by any
Credit Party with an Existing Hedge Bank in form and substance reasonably
satisfactory to the Administrative Agent.

(h) PATRIOT Act. The Borrower and each of the Subsidiary Guarantors shall have
provided to the Administrative Agent and the Lenders the documentation and other
information requested by the Administrative Agent in order to comply with the
requirements of the PATRIOT Act.

(i) Other Documents. All opinions, certificates and other instruments and all
proceedings in connection with the transactions contemplated by this Agreement
shall be reasonably satisfactory in form and substance to the Administrative
Agent. The Administrative Agent shall have received copies of all other
documents, certificates and instruments reasonably requested thereby, with
respect to the transactions contemplated by this Agreement.

Without limiting the generality of the provisions of Section 11.3(c), for
purposes of determining compliance with the conditions specified in this
Section 6.1, the Administrative Agent and each Lender that has signed this
Agreement shall be deemed to have consented to, approved or accepted or to be
satisfied with, or otherwise waived, each document or other matter required
thereunder to be consented to or approved by or acceptable or satisfactory to a
Lender unless the Administrative Agent shall have received notice from such
Lender prior to the proposed Closing Date specifying its objection thereto.

SECTION 6.2 Conditions to All Extensions of Credit. The obligations of the
Lenders to make or participate in any Extensions of Credit (including the
initial Extension of Credit) (other than an advance by a Lender pursuant to
Section 3.4 or a Revolving Credit Loan made pursuant to Section 3.5) and the
Issuing Lenders to issue or extend any Letter of Credit are subject to the
satisfaction of the following conditions precedent on the relevant borrowing,
continuation, conversion, issuance or extension date:

 

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(a) Continuation of Representations and Warranties. The representations and
warranties contained in Article VII shall be true and correct in all material
respects, except for any representation and warranty that is qualified by
materiality or reference to Material Adverse Effect, which such representation
and warranty shall be true and correct in all respects on and as of the date of
such Credit Extension with the same effect as if made on and as of such date,
(except for any such representation and warranty that by its terms is made only
as of an earlier date, which representation and warranty shall remain true and
correct in all material respects, except for any representation and warranty
that is qualified by materiality or reference to Material Adverse Effect, which
such representation and warranty shall be true and correct in all respects as of
such earlier date).

(b) No Existing Default. No Default or Event of Default shall exist, or would
result from, such proposed Credit Extension or from the application of the
proceeds therefrom.

(c) Notices. The Administrative Agent shall have received a Notice of Borrowing
or Notice of Conversion/Continuation, as applicable, from the Borrower in
accordance with Section 2.3(a) or Section 5.2, as applicable.

ARTICLE VII

REPRESENTATIONS AND WARRANTIES OF THE CREDIT PARTIES

To induce the Administrative Agent and Lenders to enter into this Agreement and
to induce the Lenders to make Extensions of Credit, the Credit Parties hereby
represent and warrant to the Administrative Agent and the Lenders (after giving
effect to the Transactions) that:

SECTION 7.1 Organization; Power; Qualification. Except as a result of a
transaction permitted under Section 9.4 or Section 9.5, each Credit Party (a) is
duly organized, validly existing and in good standing under the laws of the
jurisdiction of its incorporation or formation, (b) has the power and authority
to own its Properties and to carry on its business as now being conducted and
(c) is duly qualified and authorized to do business in each jurisdiction in
which the character of its Properties or the nature of its business requires
such qualification and authorization, except in jurisdictions where the failure
to be so qualified or in good standing could not reasonably be expected to
result in a Material Adverse Effect. The jurisdictions in which each Credit
Party and each Subsidiary thereof are organized and qualified to do business as
of the Closing Date are described on Schedule 7.1.

SECTION 7.2 Ownership. Each Subsidiary (including each Immaterial Subsidiary) of
each Credit Party, together with each such Subsidiary’s jurisdiction of
organization, as of the Closing Date is listed on Schedule 7.2. As of the
Closing Date, the capitalization of each Credit Party (other than the Borrower)
and its Subsidiaries consists of the number of shares, authorized, issued and
outstanding, of such classes and series, with or without par value, of Capital
Stock described on Schedule 7.2. As of the Closing Date, all such outstanding
shares of Capital Stock have been duly authorized and validly issued and are
fully paid and nonassessable and not subject to any preemptive or similar
rights, except as described in Schedule 7.2. The shareholders or other owners,
as applicable, of each Credit Party (other than the Borrower) and its
Subsidiaries and the number or other ownership percentage of the issued and
outstanding shares of Capital Stock owned by each as of the Closing Date are
described on Schedule 7.2. As of the Closing Date, there are no outstanding
stock purchase warrants, subscriptions, options, securities, instruments or
other rights of any type or nature whatsoever, which are convertible into,
exchangeable for or otherwise provide for or require the issuance of Capital
Stock of any Credit Party (other than the Borrower) or any Subsidiary thereof,
except as described on Schedule 7.2.

 

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SECTION 7.3 Authorization; Enforceability. Each Credit Party has the requisite
power and authority and has taken all necessary corporate or other
organizational action to authorize the execution, delivery and performance of
this Agreement and each of the other Loan Documents to which it is a party in
accordance with their respective terms. This Agreement and each of the other
Loan Documents have been duly executed and delivered by the duly authorized
officers of each Credit Party that is a party thereto, and each such document
constitutes the legal, valid and binding obligation of each Credit Party that is
a party thereto, enforceable in accordance with its terms, except (i) as such
enforceability may be limited by bankruptcy, insolvency, reorganization,
moratorium or similar state or federal debtor relief laws from time to time in
effect which affect the enforcement of creditors’ rights in general and the
availability of equitable remedies or (ii) the validity and enforceability of
the Ship Mortgages under the laws of the United States and the laws of the
Republic of the Marshall Islands, as applicable, shall be subject to their
recordation in the appropriate public office in accordance with the laws of such
jurisdiction following the occurrence of a Perfection Trigger Event.

SECTION 7.4 Compliance of Agreement, Loan Documents and Extensions of Credit
with Laws, Etc. The execution, delivery and performance by each Credit Party of
the Loan Documents to which it is a party, in accordance with their respective
terms, and the consummation of the transactions contemplated hereby and thereby
do not and will not, by the passage of time, the giving of notice or otherwise,
(a) violate any Applicable Law relating to any Credit Party, (b) conflict with,
result in a breach of or constitute a default under the articles of
incorporation, bylaws or other organizational documents of any Credit Party,
(c) conflict with, result in a breach of or constitute a default under any
material agreement or instrument to which such Person is a party or by which any
of its properties may be bound or any Governmental Approval relating to such
Person, (d) result in or require the creation or imposition of any Lien upon or
with respect to any property now owned or hereafter acquired by such Person
other than Permitted Liens, or (e) require Governmental Approval or any consent
or authorization of, or filing with, an arbitrator, or require the consent of
any other third party in connection with the execution, delivery, performance,
validity or enforceability of this Agreement, other than (i) consents,
authorizations, filings or other acts or consents for which the failure to
obtain or make could not, individually or in the aggregate, reasonably be
expected to have a Material Adverse Effect, (ii) any consents, authorizations,
filings or other acts or consents obtained or taken, as applicable, on or prior
to the Closing Date, (iii) with respect to the validity and enforceability of
the Ship Mortgages under the laws of the United States and the laws of the
Republic of the Marshall Islands, filings under the UCC, the United States
federal Ship Mortgage Act of 1920, or the Republic of the Marshall Islands
Maritime Act 1990, as applicable and (iv) filings and recordings necessary to
perfect and maintain the Liens created under the Loan Documents.

SECTION 7.5 Compliance with Law; Governmental Approvals. Each Credit Party
(a) has all Governmental Approvals required by any Applicable Law for it to
conduct its business, each of which is in full force and effect, is final and
not subject to review on appeal and is not the subject of any pending or, to its
knowledge, threatened attack by direct or collateral proceeding and (b) is in
compliance with each Governmental Approval applicable to it and in compliance
with all other Applicable Laws relating to it or any of its respective
Properties, except in the case of each of clause (a) or (b) where the failure to
have or comply could not reasonably be expected to have a Material Adverse
Effect.

 

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SECTION 7.6 Tax Returns and Payments. Each Credit Party and each Subsidiary
thereof has duly filed or caused to be filed all federal, state, local and other
Tax and information returns required by Applicable Law to be filed, and has
paid, or made adequate provision for the payment of, all federal, state, local
and other Taxes and other similar charges which are due and payable, after
giving effect to any extension therefor, except (i) any amount the validity of
which is currently being contested in good faith by appropriate proceedings and
with respect to which reserves in conformity with GAAP have been provided for on
the books of the relevant Credit Party or (ii) any such returns, Taxes, or
charges the nonfiling or nonpayment of which could not reasonably be expected to
have a Material Adverse Effect. The charges, accruals and reserves on the books
of each Credit Party and each Subsidiary thereof in respect of federal, state,
local and other Taxes for all open Tax years and for the current fiscal period
are in the judgment of the Borrower adequate for any of such years.

SECTION 7.7 Intellectual Property Matters. Each Credit Party and each Subsidiary
thereof owns or possesses rights to use all material franchises, licenses,
copyrights, copyright applications, patents, patent rights or licenses, patent
applications, trademarks, trademark rights, service mark, service mark rights,
trade names, trade name rights and other rights with respect to the foregoing
which are reasonably necessary to conduct its business. No event has occurred
which permits, or after notice or lapse of time or both would permit, the
revocation or termination of any such rights, and no Credit Party nor any
Subsidiary thereof is liable to any Person for infringement under Applicable Law
with respect to any such rights as a result of its business operations, except
as could not reasonably be expected to have a Material Adverse Effect.

SECTION 7.8 Environmental Matters.

(a) The properties owned, leased or operated by each Credit Party and each
Subsidiary thereof do not contain, and to their knowledge have not previously
contained, any Hazardous Materials in quantities or conditions that could
reasonably be expected to give rise to liability on the part of any Credit Party
or any Subsidiary thereof or which constitute or constituted a violation of
applicable Environmental Laws, except for such liability or violation that could
not reasonably be expected to have, individually or in the aggregate, a Material
Adverse Effect.

(b) All operations conducted by each Credit Party and each Subsidiary thereof
are in compliance, and have been in compliance, with all applicable
Environmental Laws, except for any noncompliance which could not reasonably be
expected, individually or in the aggregate, to have a Material Adverse Effect.

(c) No Credit Party nor any Subsidiary thereof has received any written notice
of any Environmental Claim, nor does any Credit Party or any Subsidiary thereof
have knowledge or reason to believe that any such notice will be received or is
being threatened which, in either case, could reasonably be expected,
individually or in the aggregate, to have a Material Adverse Effect.

 

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(d) Hazardous Materials have not been transported off-site or disposed of at, on
or from the properties owned, leased or operated by any Credit Party or any
Subsidiary thereof in violation of, or which could give rise to liability under,
Environmental Laws, nor have any Hazardous Materials been generated, treated,
stored or disposed of at, on or under any of such properties in violation of, or
in a manner that could give rise to liability under, any applicable
Environmental Laws, except for any liability or violation which could not
reasonably be expected, individually or in the aggregate, to have a Material
Adverse Effect.

(e) No Environmental Claim is pending, or, to the knowledge of any Credit Party
or any Subsidiary thereof, threatened, under any Environmental Law to which any
Credit Party or any Subsidiary thereof is or will be named as a potentially
responsible party, nor are there any consent decrees or other decrees, consent
orders, administrative orders or other orders, or other administrative or
judicial requirements outstanding under any Environmental Law with respect to
any Credit Party or any Subsidiary thereof that, in any such case, could
reasonably be expected, individually or in the aggregate, to have a Material
Adverse Effect.

SECTION 7.9 Employee Benefit Matters.

(a) As of the Closing Date, no Credit Party nor any ERISA Affiliate maintains or
contributes to, or has any obligation under, any Employee Benefit Plans other
than those identified on Schedule 7.9.

(b) Each Credit Party and each ERISA Affiliate is in compliance with all
applicable provisions of ERISA, the Code and the regulations and published
interpretations thereunder with respect to all Employee Benefit Plans except for
any required amendments for which the remedial amendment period as defined in
Section 401(b) of the Code has not yet expired and except where a failure to so
comply could not reasonably be expected to have a Material Adverse Effect. Each
Employee Benefit Plan that is intended to be qualified under Section 401(a) of
the Code has been determined by the IRS to be so qualified, and each trust
related to such plan has been determined to be exempt under Section 501(a) of
the Code except for such plans that have not yet received determination letters
but for which the remedial amendment period for submitting a determination
letter has not yet expired. No liability has been incurred by any Credit Party
or any ERISA Affiliate which remains unsatisfied for any taxes or penalties
assessed with respect to any Employee Benefit Plan or any Multiemployer Plan
except for a liability that could not reasonably be expected to have a Material
Adverse Effect.

(c) As of the Closing Date, no funding waiver from the IRS been received or
requested with respect to any Pension Plan, nor has any Credit Party or any
ERISA Affiliate failed to make any contributions or to pay any amounts due and
owing as required by Sections 412 or 430 of the Code, Section 302 of ERISA or
the terms of any Pension Plan prior to the due dates of such contributions under
Sections 412 or 430 of the Code or Section 302 of ERISA, nor has there been any
event requiring any disclosure under Section 4041(c)(3)(C) or 4063(a) of ERISA
with respect to any Pension Plan.

 

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(d) Except where the failure of any of the following representations to be
correct could not reasonably be expected to have a Material Adverse Effect, no
Credit Party nor any ERISA Affiliate has: (i) engaged in a nonexempt prohibited
transaction described in Section 406 of the ERISA or Section 4975 of the Code,
(ii) incurred any liability to the PBGC which remains outstanding other than the
payment of premiums and there are no premium payments which are due and unpaid,
(iii) failed to make a required contribution or payment to a Multiemployer Plan,
or (iv) failed to make a required installment or other required payment under
Sections 412 or 430 of the Code.

(e) No Termination Event has occurred or is reasonably expected to occur.

SECTION 7.10 Margin Stock. No Credit Party nor any Subsidiary thereof is engaged
principally or as one of its important activities in the business of extending
credit for the purpose of “purchasing” or “carrying” any “margin stock” (as each
such term is defined or used, directly or indirectly, in Regulation U of the
Board of Governors of the Federal Reserve System). No part of the proceeds of
any of the Loans or Letters of Credit will be used for purchasing or carrying
margin stock or for any purpose which violates, or which would be inconsistent
with, the provisions of Regulation T, U or X of such Board of Governors.
Following the application of the proceeds of each Extension of Credit, not more
than twenty-five percent (25%) of the value of the assets (either of the
Borrower only or of the Borrower and its Subsidiaries on a Consolidated basis)
subject to the provisions of Section 9.2 or Section 9.5 or subject to any
restriction contained in any agreement or instrument between the Borrower and
any Lender or any Affiliate of any Lender relating to Indebtedness will be
“margin stock”.

SECTION 7.11 Government Regulation. No Credit Party nor any Subsidiary thereof
(a) is an “investment company” or a company “controlled” by an “investment
company” (as each such term is defined or used in the Investment Company Act of
1940, as amended) and (b) is, or after giving effect to any Extension of Credit
will be, subject to regulation under the Interstate Commerce Act, as amended,
except, in the case of clause (b) only, to the extent that such regulation could
not reasonably be expected to have a Material Adverse Effect.

SECTION 7.12 Security Documents. The Receivables Security Agreement and each
Ship Mortgage executed by any Credit Party in favor of the Administrative Agent
are (a) as of the Closing Date and each Release Date, in the form required to
evidence legal, valid, enforceable and continuing Liens (subject, in the case of
the Ship Mortgages, to their recordation in the appropriate public office in
accordance with the laws of the United States and the laws of the Republic of
the Marshall Islands, as applicable, following the occurrence of a Perfection
Trigger Event), in favor of the Administrative Agent for the benefit of the
Secured Parties, in all right, title and interest of such Credit Party in any
and all of the Collateral described therein, securing the Obligations from time
to time outstanding; provided that the Liens evidenced thereunder shall not be
effective unless and until a Perfection Trigger Event has occurred, and (b) upon
all proper filings and recordings being duly made in the locations referred to
in the applicable Security Document, each such Lien created pursuant to such
Security Document would constitute a fully perfected first priority Lien in all
right, title and interest of such Credit Party in any and all of the Collateral
described therein, superior in right to any Liens, existing or future, which
such Credit Party of any creditors thereof or purchasers therefrom, or any other
Person, may have against such Collateral or interests therein, except for
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Ship Mortgage on United States flag vessels would constitute as of the date and
time of filing with the NVDC a preferred mortgage pursuant to § 31322(a) of
Title 46 of the United States Code. Each Ship Mortgage on Republic of the
Marshall Islands flag vessels would constitute as of the date and time of filing
with the Maritime Administrator of the Republic of the Marshall Islands a
preferred mortgage pursuant to the Republic of the Marshall Islands Preferred
Ship Mortgage and Maritime Liens Act, codified at § 303 of the Republic of the
Marshall Islands Maritime Act, 1990, as amended, and also pursuant to
§31301(6)(B) of Title 46 of the United States Code. Each Ship Mortgage on flag
vessels of another jurisdiction of organization would constitute as of the date
and time of filing with the applicable filing office for the filing or
registering of flag vessels in such jurisdiction a preferred mortgage pursuant
to the Applicable Laws of such jurisdiction.

SECTION 7.13 Insurance. As of the Closing Date, Schedule 7.13 sets forth a
complete and accurate list in all material respects of insurance policies and
programs in effect with respect to the properties and businesses of each Credit
Party and its Subsidiaries, specifying for each such policy and program, (i) the
amount thereof, (ii) the risks insured against thereby, (iii) the name of the
insurer and each insured party thereunder and (iv) the policy or other
identification number thereof. Such insurance policies and programs are in such
forms and amounts, and provide coverage against such risks as are required by
Section 8.6 and are customary for corporations of established reputation engaged
in the same or a similar business and owning and operating similar properties.

SECTION 7.14 Burdensome Provisions. The Credit Parties and their respective
Subsidiaries do not presently anticipate that future expenditures needed to meet
the provisions of any statutes, orders, rules or regulations of a Governmental
Authority will be so burdensome as to have a Material Adverse Effect.

SECTION 7.15 Financial Statements. The audited and unaudited financial
statements delivered pursuant to Section 6.1(f)(i) are complete and accurate in
all material respects and fairly present in all material respects the
Consolidated financial position of the Borrower and its Subsidiaries as at such
dates, and the Consolidated results of the operations and cash flows for the
periods then ended (other than customary year-end adjustments for unaudited
financial statements). All such financial statements, including the related
schedules and notes thereto, have been prepared in accordance with GAAP
consistently applied. Such financial statements show all material indebtedness
and other material liabilities, direct or contingent, of the Borrower and its
Subsidiaries as of the date thereof, including material liabilities for taxes,
material commitments, and Indebtedness, in each case, to the extent required to
be disclosed under GAAP. The projections delivered pursuant to
Section 6.1(f)(ii) were prepared in good faith on the basis of the assumptions
stated therein, which assumptions are believed to be reasonable in light of then
existing conditions except that such financial projections and statements shall
be subject to normal year end closing and audit adjustments.

SECTION 7.16 No Material Adverse Change. Since December 31, 2011, there has been
no event that has occurred or condition arisen, either individually or in the
aggregate, that could reasonably be expected to have a Material Adverse Effect.

SECTION 7.17 Solvency. The Credit Parties, on a Consolidated basis, are Solvent.

 

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SECTION 7.18 Titles to Properties; Liens. (a) Each Credit Party has good and
marketable title to, or a valid leasehold interest in, all of its Property, real
and personal, of any nature whatsoever, free and clear of all Liens, except for
Permitted Liens. The Property owned by and leased to the Credit Parties which is
necessary in the conduct of their respective businesses are in adequate
operating condition and repair, ordinary wear and tear and damage due to
casualty excepted, are free and clear of any known defects except such defects
as do not substantially interfere with the continued use thereof in the conduct
of normal operations, and are able to serve the function for which they are
intended in the conduct of such Person’s business.

(b) As of the Closing Date and as of the date of each annual delivery of the
list of Designated Vessels pursuant to Section 8.2(g), the Credit Parties are
the sole owners of each Designated Vessel and hold valid legal title to the
whole of such Designated Vessels. As of the Closing Date and as of the date of
each annual delivery of the list of Designated Vessels pursuant to
Section 8.2(g), the Credit Parties lawfully own and are lawfully possessed of
each Designated Vessel free from any Lien, charge or encumbrance whatsoever,
except for Permitted Liens, and will warrant and defend the title and possession
thereto and to every part thereof for the benefit of the Lenders against the
material claims and demands of any Person whomsoever.

SECTION 7.19 Litigation. There are no actions, suits or proceedings pending nor,
to the knowledge of the Borrower, overtly threatened against or in any other way
relating adversely to or affecting any Credit Party or any Subsidiary thereof or
any of their respective properties in any court or before any arbitrator of any
kind or before or by any Governmental Authority that could reasonably be
expected to have a Material Adverse Effect.

SECTION 7.20 OFAC. No Credit Party nor any of its Subsidiaries (i) is an “enemy”
or an “ally of the enemy” within the meaning of Section 2 of the Trading with
the Enemy Act of the United States (50 U.S.C. App. §§ 1 et seq.), as amended,
(ii) is in violation of (A) the Trading with the Enemy Act, as amended, (B) any
of the foreign assets control regulations of the United States Treasury
Department (31 CFR, Subtitle B, Chapter V, as amended) or any enabling
legislation or executive order relating thereto or (C) the PATRIOT Act, (iii) is
a Sanctioned Person, (ii) has more than 10% of its assets in Sanctioned
Countries, or (iii) derives more than 10% of its operating income from
investments in, or transactions with Sanctioned Persons or Sanctioned Countries.
No part of the proceeds of any Extension of Credit hereunder will be used
directly or indirectly to fund any operations in, finance any investments or
activities in or make any payments to, a Sanctioned Person or a Sanctioned
Country.

SECTION 7.21 Absence of Defaults. No Default or Event of Default has occurred
and is continuing.

SECTION 7.22 Disclosure. No financial statement, material report, material
certificate or other material information furnished in writing by or on behalf
of any Credit Party or any Subsidiary thereof to the Administrative Agent or any
Lender in connection with the transactions contemplated hereby and the
negotiation of this Agreement or delivered hereunder (as modified or
supplemented by other information so furnished), taken together as a whole,
contains any untrue statement of a material fact or omits to state any material
fact necessary to make the statements therein, in the light of the circumstances
under which they were made, not misleading; provided that, with respect to
projected financial information, pro forma financial information, estimated
financial information and other projected or estimated information, such
information was prepared in good faith based upon assumptions believed to be
reasonable at the time.

 

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ARTICLE VIII

AFFIRMATIVE COVENANTS

Until all of the Obligations (other than contingent indemnification obligations
not then due) have been paid in full in cash, all Letters of Credit have been
terminated or expired (or been Cash Collateralized) and the Aggregate Commitment
has been terminated, each Credit Party will, and will cause each of its
Subsidiaries to:

SECTION 8.1 Financial Statements and Budgets. Deliver to the Administrative
Agent (which shall promptly make such information available to the Lenders in
accordance with its customary practice):

(a) Annual Financial Statements. As soon as available and in any event within
ninety (90) days after the end of each Fiscal Year (commencing with the Fiscal
Year ended December 31, 2012), an audited Consolidated and unaudited
consolidating balance sheet of the Borrower and its Subsidiaries as of the close
of such Fiscal Year and audited Consolidated and unaudited consolidating
statements of operations, equity and cash flows, all in reasonable detail
setting forth in comparative form the corresponding figures as of the end of and
for the preceding Fiscal Year and prepared in accordance with GAAP. Such audited
annual financial statements shall be audited by Deloitte & Touche LLP or such
other independent certified public accounting firm of recognized national
standing reasonably acceptable to the Administrative Agent, and accompanied by a
report and opinion thereon by such certified public accountants prepared in
accordance with generally accepted auditing standards that is not subject to any
“going concern” or similar qualification or exception or any qualification as to
the scope of such audit or with respect to accounting principles followed by the
Borrower or any of its Subsidiaries that are not in accordance with GAAP.

(b) Quarterly Financial Statements. As soon as available and in any event within
forty-five (45) days after the end of the first three fiscal quarters of each
Fiscal Year (commencing with the fiscal quarter ended March 31, 2012), an
unaudited Consolidated and consolidating balance sheet of the Borrower and its
Subsidiaries as of the close of such fiscal quarter and unaudited Consolidated
and consolidating statements of operation, equity and cash flows and a report
containing management’s discussion and analysis of such financial statements for
the fiscal quarter then ended and that portion of the Fiscal Year then ended,
all in reasonable detail setting forth in comparative form the corresponding
figures as of the end of and for the corresponding period in the preceding
Fiscal Year and prepared by the Borrower in accordance with GAAP and, if
required under GAAP, containing disclosure of the effect on the financial
position or results of operations of any change in the application of accounting
principles and practices during the period, and certified on behalf of the
Borrower by a Responsible Officer of the Borrower as fairly presenting in all
material respects the financial condition, results of operations and cash flows
of the Borrower and its Subsidiaries on a Consolidated and consolidating basis
as of their respective dates and the results of operations of the Borrower and
its Subsidiaries for the respective periods then ended, subject to normal year
end audit adjustments and the absence of footnotes, together with customary
management discussion and analysis.

 

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(c) Annual Budget. As soon as available and in any event within seventy-five
(75) days after the end of each Fiscal Year, reasonably detailed forecasts
prepared by management of the Borrower (including projected consolidated balance
sheets, income statements and cash flow statements of the Borrower and its
Subsidiaries) on a quarterly basis for the Fiscal Year following such Fiscal
Year then ended (it being understood that the form of forecasts delivered by the
Borrower to the Arranger on March 14, 2012, plus the quarterly information
described above and a reasonably detailed description of the underlying
assumptions applicable thereto, would be satisfactory).

Notwithstanding the foregoing, (i) in the event that the Borrower delivers to
the Administrative Agent an Annual Report for the Borrower on Form 10-K for such
Fiscal Year, as filed with the SEC, within 90 days after the end of such Fiscal
Year, such Form 10-K shall satisfy all requirements of clause (a) of this
Section to the extent that it contains the information required by such
clause (a) and does not contain any “going concern” or similar qualification or
exception or any qualification as to the scope of such audit or with respect to
accounting principles followed by the Borrower or any of its Subsidiaries that
are not in accordance with GAAP and (ii) in the event that the Borrower delivers
to the Administrative Agent a Quarterly Report for the Borrower on Form 10-Q for
such fiscal quarter, as filed with the SEC, within 45 days after the end of such
fiscal quarter, such Form 10-Q shall satisfy all requirements of clause (b) of
this Section to the extent that it contains the information required by such
clause (b); in each case to the extent that information contained in such 10-K
or 10-Q satisfies the requirements of clause (a) or (b) of this Section, as the
case may be.

SECTION 8.2 Certificates; Other Reports. Deliver to the Administrative Agent
(which shall promptly make such information available to the Lenders in
accordance with its customary practice):

(a) at each time financial statements are delivered pursuant to Sections 8.1(a)
or (b), a duly completed Officer’s Compliance Certificate signed on behalf of
the Borrower by a Responsible Officer of the Borrower;

(b) at each time financial statements are delivered pursuant to Section 8.1(a),
a certificate of the independent certified public accountants of the Borrower
(but only to the extent permitted by accounting industry policies generally
followed by independent certified public accountants) certifying that in
connection with their audit, nothing came to their attention that caused them to
believe that the Credit Parties failed to comply with the terms, covenants,
provisions or conditions of Section 9.14, insofar as they relate to financial
and accounting matters or, if such is not the case, specifying such
non-compliance and its nature and period of existence;

(c) promptly after the assertion or occurrence thereof, notice of any
Environmental Claim or of any filing or report made by any Credit Party or any
Subsidiary thereof with any Governmental Authority with respect to any violation
of or liability under any Environmental Law that could reasonably be expected to
have a Material Adverse Effect;

 

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

(e) promptly, and in any event within ten (10) Business Days after receipt
thereof by any Credit Party or any Subsidiary thereof, copies of each notice or
other correspondence received from the SEC (or comparable agency in any
applicable non-U.S. jurisdiction) concerning any material investigation or other
material inquiry by such agency regarding financial or other operational results
of any Credit Party or any Subsidiary thereof;

(f) promptly upon the request thereof, such other information and documentation
required by bank regulatory authorities under applicable “know your customer”
and anti-money laundering rules and regulations (including, without limitation,
the PATRIOT Act), as from time to time reasonably requested by the
Administrative Agent or any Lender;

(g) within ninety (90) days after the end of each Fiscal Year, a certificate of
a Responsible Officer of the Borrower listing all Designated Vessels and the
geographic location of such Designated Vessels as of a recent date; provided,
however, that such certificate shall not be required after the Springing Lien
Termination Date;

(h) within forty-five (45) days after the end of each calendar month of each
Fiscal Year, a backlog schedule and a schedule of all work-in-progress,
identified by contract or project, of the Borrower and its Subsidiaries for the
performance of dredging, construction or other services as of the end of such
calendar month, prepared in a manner consistent with past practice;

(i) within forty-five (45) days after the end of each calendar quarter of each
Fiscal Year, a schedule of pending major United States projects of the Borrower
and its Subsidiaries as of the end of such calendar quarter;

(j) within seventy-five (75) days after each Fiscal Year, a schedule of (i) all
flag vessels subject to an Operating Lease as of the end of such calendar
quarter, (ii) the aggregate amount of rentals required to be paid by the
Borrower and its Subsidiaries under each such Operating Lease for the ensuing
five (5) Fiscal Years, as reflected on a quarterly basis and (iii) the buy-out
amount of each flag vessel subject to such Operating Lease as of the end of such
calendar quarter;

(k) at each time financial statements are delivered pursuant to Section 8.1(a),
information in reasonable detail as to the insurance then in effect, stating the
names of the insurance companies, the amount of the insurance, the dates of the
expiration thereof and the properties and risks covered thereby; provided, that
in the event that the Borrower delivers to the Administrative Agent copies of
certificates of insurance, such delivery shall satisfy all requirements of this
clause (k) to the extent that it contains the information required by this
clause (k); and

 

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(l) such other information regarding the operations, business affairs and
financial condition of any Credit Party or any Subsidiary thereof as the
Administrative Agent, or any Lender through the Administrative Agent, may
reasonably request.

Documents required to be delivered pursuant to Section 8.1(a) or (b) or
Section 8.2(d) (to the extent any such documents are included in materials
otherwise filed with the SEC) may be delivered electronically and if so
delivered, shall be deemed to have been delivered on the date (i) on which the
Borrower posts such documents, or provides a link thereto on the Borrower’s
website on the Internet at http://investor.gldd.com/sec.cfm; or (ii) on which
such documents are posted on the Borrower’s behalf on an Internet or intranet
website, if any, to which each Lender and the Administrative Agent have access
(whether a commercial, third-party website or whether sponsored by the
Administrative Agent); provided that: (x) upon written request by the
Administrative Agent, the Borrower shall deliver paper copies of such documents
to the Administrative Agent or any Lender that requests the Borrower to deliver
such paper copies until a written request to cease delivering paper copies is
given by the Administrative Agent or such Lender and (y) the Borrower shall
notify the Administrative Agent (which may be by facsimile or electronic mail)
of the posting of any such documents and provide to the Administrative Agent by
electronic mail electronic versions of such documents. The Administrative Agent
shall have no obligation to request the delivery or to maintain copies of the
documents referred to above, and in any event shall have no responsibility to
monitor compliance by the Borrower with any such request for delivery, and each
Lender shall be solely responsible for requesting delivery to it or maintaining
its copies of such documents.

The Borrower hereby acknowledges that (a) the Administrative Agent and/or the
Arranger will make available to the Lenders and the Issuing Lenders materials
and/or information provided by or on behalf of the Borrower hereunder
(collectively, “Borrower Materials”) by posting the Borrower Materials on
SyndTrak Online or another similar electronic system (the “Platform”) and
(b) certain of the Lenders may be “public-side” Lenders (i.e., Lenders that do
not wish to receive material non-public information with respect to the Borrower
or its securities) (each, a “Public Lender”). The Borrower hereby agrees that so
long as the Borrower is the issuer of any outstanding debt or equity securities
that are registered or issued pursuant to a private offering or is actively
contemplating issuing any such securities it will use commercially reasonable
efforts to identify that portion of the Borrower Materials that may be
distributed to the Public Lenders and that (w) all such Borrower Materials shall
be clearly and conspicuously marked “PUBLIC” which, at a minimum, shall mean
that the word “PUBLIC” shall appear prominently on the first page thereof;
(x) by marking Borrower Materials “PUBLIC,” the Borrower shall be deemed to have
authorized the Administrative Agent, the Arranger, the Issuing Lenders and the
Lenders to treat such Borrower Materials as not containing any material
non-public information (although it may be sensitive and proprietary) with
respect to the Borrower or its securities for purposes of United States Federal
and state securities laws (provided, however, that to the extent such Borrower
Materials constitute Information, they shall be treated as set forth in
Section 12.11); (y) all Borrower Materials marked “PUBLIC” are permitted to be
made available through a portion of the Platform designated “Public Investor;”
and (z) the Administrative Agent and the Arranger shall be entitled to treat any
Borrower Materials that are not marked “PUBLIC” as being suitable only for
posting on a portion of the Platform not designated “Public Investor.”

 

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SECTION 8.3 Notice of Litigation and Other Matters. Promptly (but in no event
later than ten (10) days after a Responsible Officer of any Credit Party obtains
knowledge thereof) notify the Administrative Agent in writing of (which shall
promptly make such information available to the Lenders in accordance with its
customary practice):

(a) the occurrence of any Default or Event of Default;

(b) the commencement of any proceeding or investigation by or before any
Governmental Authority or before any arbitrator against or involving any Credit
Party or any Subsidiary thereof or any of their respective properties, assets or
businesses that could reasonably be expected to result in a Material Adverse
Effect;

(c) any notice of any violation of Applicable Law received by any Credit Party
or any Subsidiary thereof from any Governmental Authority including, without
limitation, any notice of violation of Environmental Laws which, in any such
case, could reasonably be expected to result in liabilities or expenses of any
Credit Party or any Subsidiary thereof in excess of the Threshold Amount;

(d) any labor controversy that has resulted in, or threatens to result in, a
strike or other work action against any Credit Party or any Subsidiary thereof
which could reasonably be expected to result in a Material Adverse Effect;

(e) any attachment, judgment, lien, levy or order exceeding the Threshold Amount
that may be assessed against any Credit Party or any Subsidiary thereof;

(f) (i) all notices received by any Credit Party or any ERISA Affiliate of the
PBGC’s intent to terminate any Pension Plan or to have a trustee appointed to
administer any Pension Plan, (ii) all notices received by any Credit Party or
any ERISA Affiliate from a Multiemployer Plan sponsor concerning the imposition
or amount of withdrawal liability pursuant to Section 4202 of ERISA which in any
such case could reasonably be expected to result in liabilities to the Borrower
and its Subsidiaries in excess of the Threshold Amount and (iii) the Borrower
obtaining knowledge or reason to know that any Credit Party or any ERISA
Affiliate has filed or intends to file a notice of intent to terminate any
Pension Plan under a distress termination within the meaning of Section 4041(c)
of ERISA; and

(g) any matter that has resulted or could reasonably be expected to result in a
Material Adverse Effect.

Each notice pursuant to Section 8.3 shall be accompanied by a statement of a
Responsible Officer of the Borrower setting forth in reasonable detail the
occurrence referred to therein and stating what action the Borrower has taken
and proposes to take with respect thereto.

 

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SECTION 8.4 Preservation of Corporate Existence and Related Matters. Except as
permitted by Section 9.4 or Section 9.5, (a) preserve and maintain its good
standing and legal existence under the laws of the jurisdiction of its
organization and (b) take all reasonable action to maintain all rights,
franchises, licenses and privileges (including good standing) necessary to the
conduct of its business, except in the case of this clause (b) only, where the
failure to so maintain could reasonably be expected to have a Material Adverse
Effect.

SECTION 8.5 Maintenance of Property and Licenses. Maintain and preserve all of
its Properties that are used or useful in the conduct of its business in good
working order and condition (ordinary wear and tear excepted), except as would
not reasonably be expected to result in a Material Adverse Effect.

SECTION 8.6 Insurance. Maintain insurance with financially sound and reputable
insurance companies against at least such risks and in at least such amounts as
are customarily maintained by similar businesses and as may be required by
Applicable Law and as are required by any Security Documents, including, without
limitation, the following insurance policies and programs:

(a) physical damage insurance on all material real and personal property
(including inventory) covering (i) for all open and operating facilities, book
value of all such property and (ii) for all closed, inactive vacant facilities,
the actual cash value of such facilities;

(b) Marine General Liability (or Commercial General Liability) insurance
(including coverage for bodily injury and property damage, products and
completed operations, premises and operations, sudden and accidental pollution
liability, contractual liability, and actions over indemnification) in an amount
equal to a limit of not less than $1,000,000 per occurrence and an aggregate
amount equal to a limit of not less than $2,000,000;

(c) Hull and Machinery insurance with typical standard coverage covering the
Designated Vessels in an amount equal to the aggregate value of all such
Designated Vessels as agreed to from time to time between the Borrower and the
relevant insurer under such Hull and Machinery policy with a claim deductible of
not more than $500,000 and, as of the Closing Date, an aggregate limit with
respect to the Designated Vessels of an amount not less than $309,000,000;

(d) Protection and Indemnity insurance with typical standard coverage in an
amount equal to a limit of not less than $1,000,000 per occurrence and a per
occurrence deductible of not more than $900,000;

(e) Workers Compensation and Longshore and Harbor Workers insurance (including
Employer’s Liability insurance (or monopolistic State Stop Gap insurance
coverage endorsed on the General Liability insurance of $1,000,000)) per
statutory limits;

(f) War Risk and Confiscation insurance with respect to each Designated Vessel
in a country outside of the United States, in an amount equal to the value of
the assets as agreed to from time to time between the Borrower and the relevant
insurer under the Hull and Machinery policy unless (i) the Borrower shall have
notified the Administrative Agent that it has determined, in good faith, that
such insurance with respect to such contract is not available at a reasonable
economic cost or not available

 

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from a reputable insurer, or the property or assets to be used in connection
with such contract is not subject to a material risk of asset seizure in such
country and (ii) the Administrative Agent shall have concurred with such
conclusion in writing (which concurrence shall not be unreasonably withheld or
delayed);

(g) Vessel Pollution Liability insurance coverage in an amount equal to a limit
of not less than $5,000,000;

(h) Umbrella Liability insurance in an amount of at least $75,000,000 in
addition to the limits within the Marine General Liability (or Commercial
General Liability), Protection and Indemnity, Employer’s Liability, War Risk and
Confiscation and Vessel Pollution Liability insurance policies listed above; and

(i) such other additional insurance coverage and with respect to such risks as
is customary for businesses similar to that of the Borrower and its
Subsidiaries.

At all times prior to the Springing Lien Termination Date, all policies of
general liability insurance shall (to the extent available) provide that no
cancellation thereof shall be effective until at least 30 days written notice
has been provided to the Administrative Agent and name the Administrative Agent
as an additional insured thereunder pursuant to endorsements reasonably
acceptable to the Administrative Agent (including, to the extent available,
waiver of subrogation). Promptly following the Closing Date and continuing
thereafter until the Springing Lien Termination Date, (i) all policies of
protection and indemnity insurance shall (to the extent available) provide that
no cancellation thereof shall be effective until at least 30 days written notice
has been provided to the Administrative Agent and name the Administrative Agent
as an additional insured thereunder pursuant to endorsements reasonably
acceptable to the Administrative Agent (including, to the extent available,
waiver of subrogation) or (ii) the Borrower will cause the interest of the
Administrative Agent to be noted with respect to all protection and indemnity
insurance pursuant to a letter reasonably acceptable to the Administrative
Agent. Promptly following a Perfection Trigger Event and continuing thereafter
while such Perfection Period remains in effect, all policies and certificates of
entry with respect to hull and machinery insurance to the extent relating to the
Designated Vessels shall name the Administrative Agent as an additional insured
and contain a loss payable clause which, by language reasonably acceptable to
the Administrative Agent, shall provide for payment to the Administrative Agent
or its order to the extent relating to the Designated Vessels, and shall provide
that no cancellation thereof shall be effective until at least 30 days written
notice has been provided to the Administrative Agent.

SECTION 8.7 Accounting Methods and Financial Records. Maintain a system of
accounting, and keep proper books, records and accounts (which shall be true and
complete in all material respects) as may be required or as may be necessary to
permit the preparation of financial statements in accordance with GAAP and in
compliance in all material respects with the applicable regulations of any
Governmental Authority having jurisdiction over it or any of its Properties (it
being understood and agreed that Foreign Subsidiaries of the Borrower may
maintain books, records and accounts in conformity with generally accepted
accounting principles that are applicable in their respective jurisdiction of
organization).

 

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SECTION 8.8 Payment of Taxes. Pay all material Taxes, assessments and other
governmental charges that may be levied or assessed upon it or any of its
Property; provided, that none of the Borrower or any of its Subsidiaries shall
be required to pay or perform any such Tax, assessment or other governmental
charge (a) which is being contested in good faith, so long as adequate reserves
are maintained with respect thereto in accordance with GAAP or (b) where the
failure to pay or perform such items could not reasonably be expected to have a
Material Adverse Effect.

SECTION 8.9 Compliance with Laws and Approvals. Observe and remain in compliance
with all Applicable Laws and maintain in full force and effect all Governmental
Approvals, in each case applicable to the conduct of its business, except where
the failure to do so could not reasonably be expected to have a Material Adverse
Effect.

SECTION 8.10 Environmental Laws. In addition to and without limiting the
generality of Section 8.9, (a) comply with all applicable Environmental Laws and
obtain and comply with any and all licenses or permits required by applicable
Environmental Laws, (b) complete all investigations, studies, sampling and
testing and all remedial, removal and other actions required under Environmental
Laws, and timely comply with all lawful orders and directives of any
Governmental Authority regarding Environmental Laws, and (c) defend, indemnify
and hold harmless the Administrative Agent and the Lenders, and their respective
parents, Subsidiaries, Affiliates, employees, agents, officers and directors,
from and against any claims, demands, penalties, fines, liabilities,
settlements, damages, costs and expenses of whatever kind or nature known or
unknown, contingent or otherwise, arising out of, or in any way relating to the
presence of Hazardous Materials, or the violation of, noncompliance with or
liability under any Environmental Laws applicable to the operations of the
Borrower or any such Subsidiary, or any orders, requirements or demands of
Governmental Authorities related thereto, including, without limitation,
reasonable attorney’s and consultant’s fees, investigation and laboratory fees,
response costs, court costs and litigation expenses, except to the extent that
any of the foregoing directly result from the gross negligence or willful
misconduct of the party seeking indemnification therefor, as determined by a
court of competent jurisdiction by final nonappealable judgment.

SECTION 8.11 Compliance with ERISA. In addition to and without limiting the
generality of Section 8.9, except where the failure to so comply would not,
individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect, (a) comply with applicable provisions of ERISA, the Code and the
regulations and published interpretations thereunder with respect to all
Employee Benefit Plans, (b) not take any action or fail to take action the
result of which could reasonably be expected to result in a liability to the
PBGC or to a Multiemployer Plan and (c) not participate in any prohibited
transaction that could result in any civil penalty under ERISA or tax under the
Code.

SECTION 8.12 Visits and Inspections. Permit representatives of the
Administrative Agent and, during the continuance of any Event of Default, each
Lender, to visit and inspect any of its properties to examine its corporate,
financial and operating records, and make copies thereof or abstracts therefrom,
and to discuss its affairs, finances and accounts with its directors, officers,
and independent public accountants (subject to such accountants’ customary
policies and procedures), all at the reasonable expense of the Borrower and at
such reasonable times

 

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during normal business hours and as often as may be reasonably desired, and upon
reasonable advance notice to the Borrower; provided that, excluding any such
visits and inspections during the continuation of an Event of Default, (i) only
the Administrative Agent on behalf of the Lenders may exercise rights under this
Section 8.12, (ii) the Administrative Agent shall not exercise such rights more
often than one (1) time during any calendar year and (iii) such exercise shall
be at the Borrower’s expense; provided, further that when an Event of Default
exists, the Administrative Agent or any Lender (or any of their respective
representatives) may do any of the foregoing at the expense of the Borrower at
any time without advance notice. The Administrative Agent and the Lenders shall
give the Borrower the opportunity to participate in any discussions with the
Borrower’s accountants.

SECTION 8.13 Additional Subsidiaries. Notify the Administrative Agent of the
creation or acquisition of any Domestic Subsidiary and promptly thereafter (and
in any event within thirty (30) days after such creation or acquisition), except
in the case of an Immaterial Subsidiary, cause such Person to (i) become a
Subsidiary Guarantor by delivering to the Administrative Agent a duly executed
supplement to the Subsidiary Guaranty Agreement, in form and substance
reasonably satisfactory to the Administrative Agent, (ii) at any time prior to
the Springing Lien Termination Date, become a party to the Receivables Security
Agreement by delivering a duly executed supplement to such Security Document, in
form and substance reasonably satisfactory to the Administrative Agent to (x) at
all times other than during a Perfection Period, the Escrow Agent and (y) at all
times during a Perfection Period, the Administrative Agent, (iii) deliver to the
Administrative Agent such documents and certificates referred to in Section 6.1
as may be reasonably requested by the Administrative Agent and (iv) deliver to
the Administrative Agent such updated Schedules to the Loan Documents as
reasonably requested by the Administrative Agent with respect to such Person.

SECTION 8.14 Use of Proceeds. Use the proceeds of the Extensions of Credit to
finance (a) the Refinancing and (b) the working capital and general corporate
purposes of the Borrower and its Subsidiaries, including Permitted Acquisitions
and other Investments permitted hereunder and the payment of fees, costs and
expenses incurred in connection with the Transactions and this Agreement.

ARTICLE IX

NEGATIVE COVENANTS

Until all of the Obligations (other than contingent, indemnification obligations
not then due) have been paid in full in cash, all Letters of Credit have been
terminated or expired (or been Cash Collateralized) and the Aggregate Commitment
has been terminated, the Credit Parties will not, and will not permit any of
their respective Subsidiaries to.

 

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SECTION 9.1 Indebtedness. Create, incur, assume or suffer to exist any
Indebtedness except:

(a) the Obligations;

(b) Indebtedness in respect of Hedge Agreements entered into in order to manage
existing or anticipated interest rate, exchange rate or commodity price risks
and not for speculative purposes;

(c) Indebtedness, including Indebtedness in respect of Guaranties, existing on
the Closing Date and listed on Schedule 9.1 (other than Note Indenture
Obligations), and any refinancings, refundings, renewals, replacements,
exchanges or extensions thereof; provided that (i) the principal amount of such
Indebtedness is not increased at the time of such refinancing, refunding,
renewal, replacement, exchange or extension except by an amount equal to accrued
and unpaid interest and a reasonable premium plus other reasonable amounts paid,
and fees and expenses reasonably incurred, in connection with such refinancing
and by an amount equal to any existing commitments unutilized thereunder,
(ii) the final maturity date and weighted average life of such refinancing,
refunding, renewal or extension shall not be prior to or shorter than that
applicable to the Indebtedness prior to such refinancing, refunding, renewal or
extension and (iii) the terms of any such refinancing, refunding, renewal or
extension are not materially less favorable to such Credit Party than the
Indebtedness prior to such refinancing, refunding, renewal or extension;

(d) Indebtedness incurred in connection with Capital Leases and purchase money
Indebtedness incurred by the Borrower or any of its Subsidiaries to any Person
to finance the acquisition, construction, maintenance, repair or improvement of
assets, including any such Indebtedness incurred after the acquisition,
construction, maintenance, repair or improvement of such assets, so long as in
each case, the amount of such Indebtedness does not exceed 100% of the purchase
price, construction cost, maintenance cost, repair cost or improvement cost of
the assets acquired, constructed, repaired or improved with the proceeds thereof
and, in the case of Indebtedness incurred after the acquisition, construction,
repair or improvement of the assets to be financed, such Indebtedness is
incurred no later than twelve calendar months after such assets are acquired,
constructed, repaired or improved;

(e) Indebtedness of a Person existing at the time such Person became a
Subsidiary or assets were acquired from such Person in connection with an
Investment permitted pursuant to Section 9.3, to the extent that (i) such
Indebtedness was not incurred in connection with, or in contemplation of, such
Person becoming a Subsidiary or the acquisition of such assets, (ii) neither the
Borrower nor any Subsidiary thereof (other than such Person or any other Person
that such Person merges with or that acquires the assets of such Person) shall
have any liability or other obligation with respect to such Indebtedness and
(iii) the aggregate outstanding principal amount of such Indebtedness does not
exceed $25,000,000 at any time outstanding;

(f) Guaranty Obligations with respect to Indebtedness permitted pursuant to this
Section;

(g) unsecured intercompany Indebtedness owed (i) by any Credit Party to another
Credit Party, (ii) by any Non-Guarantor Subsidiary to any Credit Party or to any
other Non-Guarantor Subsidiary and (iii) by any Credit Party to any
Non-Guarantor Subsidiary (provided, that such Indebtedness permitted in this
clause (iii) shall be subordinated to the Obligations in a manner reasonably
satisfactory to the Administrative Agent in an aggregate principal amount not to
exceed $20,000,000 at any time outstanding;

 

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(h) Indebtedness incurred in the ordinary course of business in respect of
netting services, overdraft protections, employee credit card programs,
automatic clearinghouse arrangements and similar arrangements in each case in
connection with deposit accounts and Indebtedness arising from the honoring by a
bank or other financial institution of a check, draft or other similar
instrument drawn against insufficient funds in the ordinary course of business;

(i) Subordinated Indebtedness of the Borrower and its Subsidiaries; provided,
that in the case of each incurrence of such Subordinated Indebtedness, (i) no
Default or Event of Default shall have occurred and be continuing or would
result by the incurrence of such Subordinated Indebtedness, and (ii) the
Administrative Agent shall have received satisfactory written evidence that the
Borrower would be in compliance with the financial covenants set forth in
Section 9.14 on a pro forma basis after giving effect to the issuance of any
such Subordinated Indebtedness;

(j) Indebtedness constituting Bonding Obligations;

(k) Indebtedness in respect of letters of credit, bank guarantees or similar
instruments issued or created in the ordinary course of business; provided that
the aggregate amount of Indebtedness permitted in this clause (k) shall not
exceed $50,000,000 at any time;

(l) Unsecured Indebtedness consisting of promissory notes issued to current or
former officers, directors and employees (or their respective family members,
estates or trusts or other entities for the benefit of any of the foregoing) of
the Borrower or its Subsidiaries to purchase or redeem Capital Stock permitted
pursuant to Section 9.6; provided that the aggregate principal amount of all
such Indebtedness shall not exceed $5,000,000 at any time outstanding;

(m) Indebtedness constituting Note Indenture Obligations;

(n) Indebtedness incurred in the ordinary course of business of the Borrower and
its Subsidiaries in the nature of open accounts (extended by suppliers on normal
trade terms in connection with purchases of goods and services), accrued
liabilities and deferred income, taxes and judgments or orders for the payment
of money to the extent such judgments or orders do not result in any Event of
Default or result in any Liens prohibited by Section 9.2;

(o) Indebtedness in respect of taxes, assessments, governmental charges and
claims for labor, materials or supplies, to the extent that payment thereof is
not required pursuant to Section 8.8;

(p) Indebtedness representing deferred compensation or stock-based compensation
to employees of the Borrower and its Subsidiaries;

(q) Indebtedness consisting of obligations of the Borrower and its Subsidiaries
under deferred consideration (including earn-outs, indemnifications, incentive
non-competes, purchase price adjustments and other contingent obligations) or
other similar arrangements incurred by such Person in connection with any
Permitted Acquisitions, Asset Dispositions and any other Investments permitted
under Section 9.3; provided that the aggregate principal amount of all such
Indebtedness shall not exceed $25,000,000 in the aggregate at any time
outstanding (calculated to include such amounts to the extent required to be
included as liabilities in accordance with GAAP);

 

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(r) Indebtedness consisting of the financing of insurance premiums in the
ordinary course of business;

(s) Indebtedness incurred pursuant to the Wells Fargo Documents in an aggregate
principal amount not to exceed $40,000,000 at any time outstanding (including,
for the avoidance of doubt, the face amount of all undrawn letters of credit
issued thereunder);

(t) Indebtedness of any Credit Party or any Subsidiary thereof in an aggregate
principal amount not to exceed the greater of (i) $15,000,000 and (ii) 8% of
Tangible Net Worth, at any time outstanding; and

(u) all premiums (if any), interest (including post-petition interest), fees,
expenses, indemnities, charges and additional or contingent interest on
obligations described in clauses (a) through (t) of this Section 9.1.

SECTION 9.2 Liens. Create, incur, assume or suffer to exist, any Lien on or with
respect to any of its Property, whether now owned or hereafter acquired, except:

(a) (i) Liens created pursuant to the Loan Documents and (ii) Liens on cash or
deposits granted in favor of the Swingline Lender or the Issuing Lenders to Cash
Collateralize any Letters of Credit or Swingline Loans;

(b) Liens in existence on the Closing Date and described on Schedule 9.2 and any
modifications, replacements, renewals, refinancings or extensions thereof;
provided that (i) the Lien does not extend to any additional property, other
than (A) after-acquired property that is affixed or incorporated into the
property covered by such Lien or financed by Indebtedness permitted under
Section 9.1, and (B) and proceeds and products thereof and (ii) the replacement,
renewal, extension or refinancing of the obligations secured or benefited by
such Liens, to the extent constituting Indebtedness, is permitted by
Section 9.1;

(c) Liens for taxes, assessments and other governmental charges or levies
(excluding any Lien imposed pursuant to any of the provisions of ERISA or
Environmental Laws) (i) not yet due or as to which the period of grace (not to
exceed thirty (30) days), if any, related thereto has not expired or (ii) which
are being contested in good faith and by appropriate proceedings if adequate
reserves are maintained to the extent required by GAAP;

(d) statutory or common law Liens of landlords, carriers, warehousemen,
mechanics, materialmen, repairmen, construction contractors or other like Liens
arising in the ordinary course of business which secure amounts not overdue for
a period of more than sixty (60) days or if more than sixty (60) days overdue,
are unfiled and no other action has been taken to enforce such Lien or which are
being contested in good faith and by appropriate proceedings diligently
conducted, if adequate reserves with respect thereto are maintained on the books
of the Borrower or its Subsidiaries;

(e) deposits or pledges made in the ordinary course of business (including,
without limitation, surety bonds and appeal bonds) in connection with, or to
secure payment of, obligations under workers’ compensation, unemployment
insurance and other types of social security or similar legislation, or to
secure the performance of bids, trade contracts, government

 

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contracts, leases (other than Indebtedness), statutory obligations, surety bonds
(other than bonds related to judgments or litigation), performance bonds and
other obligations of a like nature or arising as a result of progress payments
under government contracts (including (i) those to secure health, safety and
environmental obligations and (ii) those required or requested by any
Governmental Authority) incurred in the ordinary course of business;

(f) easements, rights-of-way, restrictions (including zoning restrictions),
encroachments, protrusions and other similar encumbrances and minor title
defects affecting real property which, in the aggregate, do not materially
interfere with the ordinary conduct of the business of the Borrower and its
Subsidiaries;

(g) Liens arising from the filing of precautionary UCC financing statements
relating to leases entered into by the Borrower or any of its Subsidiaries in
the ordinary course of business;

(h) Liens securing Indebtedness permitted under Section 9.1(d); provided that
such Liens do not at any time encumber any property other than the property (and
replacements and accessions to such property) financed by such Indebtedness and
the proceeds and products thereof;

(i) Liens securing judgments for the payment of money not constituting an Event
of Default under Section 10.1(l) or securing appeal or other surety bonds
relating to such judgments;

(j) (i) Liens on Property (i) of any Subsidiary which are in existence at the
time that such Subsidiary is acquired pursuant to a Permitted Acquisition and
(ii) of the Borrower or any of its Subsidiaries existing at the time such
property or assets are purchased or otherwise acquired by the Borrower or such
Subsidiary thereof pursuant to a transaction permitted pursuant to this
Agreement; provided that, with respect to each of the foregoing clauses (i) and
(ii), (A) such Liens and the Indebtedness secured by such Liens are not incurred
in connection with, or in anticipation of, such Permitted Acquisition, purchase
or other acquisition, (B) such Liens do not attach to any other Property of the
Borrower or any of its Subsidiaries (and replacements and accessions to such
Property and proceeds and products thereof), and (C) the Indebtedness secured by
such Liens is permitted under Section 9.1(other than Section 9.1(d)) of this
Agreement);

(k) (i) Liens of a collecting bank arising in the ordinary course of business
under Section 4-210 of the Uniform Commercial Code in effect in the relevant
jurisdiction and (ii) Liens of any depositary bank in connection with statutory,
common law and contractual rights of set-off and recoupment with respect to any
deposit account of any Borrower or any Subsidiary thereof;

(l) (i) contractual or statutory Liens of landlords to the extent relating to
the property and assets relating to any lease agreements with such landlord, and
(ii) contractual Liens of suppliers (including sellers of goods) or customers
granted in the ordinary course of business to the extent limited to the property
or assets relating to such contract;

 

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(m) leases or subleases (including bareboat charters) of Property other than
Collateral, or Property that would constitute Collateral, by the Borrower or any
of its Subsidiaries as lessor or sublessor, provided that such leases and
subleases do not interfere in any material respect with the businesses of the
Borrower and its Subsidiaries, and are not otherwise prohibited under the other
terms of this Agreement, and leases or subleases (including bareboat charters)
of Property constituting, or that would constitute, Collateral, provided that
such leases and subleases do not interfere in any material respect with the
businesses of the Borrower and its Subsidiaries, are not otherwise prohibited
under the other terms of this Agreement and are made in the ordinary course of
business;

(n) Liens on any Property used by the Borrower or any Subsidiary in the ordinary
course of business and not constituting, or that would not constitute,
Collateral, provided that such Liens existed prior to the acquisition thereof by
the Borrower or such Subsidiary and were not created in contemplation of such
acquisition;

(o) Liens granted to Sureties under any Bonding Agreement or to secure any
Bonding Obligations, or Liens that could, pursuant to the terms of any Bonding
Agreement, attach as security for any Bonding Obligation upon the satisfaction
of conditions or events described in the relevant Bonding Agreement; provided
that to the extent any such Lien attaches or could attach to any Collateral or
Property that would constitute Collateral, such Lien shall be subject to the
terms and conditions of a Lender-Surety Agreement;

(p) Liens securing obligations of the Borrower or its Subsidiaries under Hedge
Agreements permitted pursuant to Section 9.1(b), provided that such Lien is
granted in favor of a Secured Party or an Affiliate thereof; and

(q) Liens arising by operation of law or by contract in each case encumbering
insurance policies and proceeds thereof to secure the financing of premiums
payable under such policies;

(r) Liens (i) on cash advances in favor of the seller of any property to be
acquired in an Investment permitted by Section 9.3 to be applied against the
purchase price for such Investment, or (ii) pursuant to a purchase agreement or
sale agreement securing the obligations under such purchase agreement or sale
agreement and encumbering solely the assets that are to be sold in any asset
disposition permitted or not otherwise prohibited by this Agreement;

(s) Liens on accounts receivables for which attempts at collection have been
undertaken by a third party;

(t) Liens on Permitted Wells Fargo Facility Collateral securing Indebtedness
permitted under Section 9.1(s) and Guaranty Obligations with respect thereto;

(u) Liens on cash or Cash Equivalents used to defease or to satisfy and
discharge Indebtedness, provided that such defeasance or satisfaction and
discharge is permitted hereunder; and

 

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(v) Liens on Property other than the Collateral, or Property that would
constitute Collateral, securing Indebtedness or other obligations in the
aggregate principal amount not to exceed the greater of (i) $10,000,000 and
(ii) 5% of Tangible Net Worth at any time outstanding.

SECTION 9.3 Investments. Make or hold any Investment, except:

(a) Investments existing on the Closing Date, as set forth on Schedule 9.3;

(b) Investments in cash and Cash Equivalents or that were Cash Equivalents when
made;

(c) (i) Investments existing on the Closing Date in Subsidiaries of the Borrower
existing on the Closing Date, (ii) Investments by the Borrower in any Subsidiary
Guarantor and Investments by any Subsidiary of the Borrower in any Credit Party,
(iii) Investments by any Non-Guarantor Subsidiary in any other Non-Guarantor
Subsidiary, and (iv) Investments by the Borrower or any Subsidiary thereof in
any Non-Guarantor Subsidiary, provided that the aggregate amount of such
Investments made pursuant to this clause (iv) shall not exceed $25,000,000;

(d) Investments in the form of Capital Expenditures;

(e) deposits made in the ordinary course of business to secure the performance
of leases or other obligations as permitted by Section 9.2;

(f) Hedge Agreements permitted pursuant to Section 9.1;

(g) purchases of assets in the ordinary course of business;

(h) (i) the purchase or acquisition of all or substantially all of the property
and assets or business of, any Person or of assets constituting a business unit,
a line of business or division of such Person, or of all of the Capital Stock in
a Person that, upon the consummation thereof, will be a Subsidiary that is
wholly owned directly by the Borrower or one or more of its wholly owned
Subsidiaries (including, without limitation, as a result of a merger or
consolidation), which is made solely with the net cash proceeds of any
substantially concurrent sale or issuance of any Capital Stock (other than
Disqualified Capital Stock of the Borrower); provided, that the aggregate
consideration paid by the Borrower or any Subsidiary for all such acquisitions
made pursuant to this subclause (i) on and after the Closing Date shall not
exceed $50,000,000, or (ii) the purchase or other acquisition of all or
substantially all of the property and assets or business of, any Person or of
assets constituting a business unit, a line of business or division of such
Person, or of all of the Capital Stock in a Person that, upon the consummation
thereof, will be a Subsidiary that is wholly owned directly by the Borrower or
one or more of its wholly owned Subsidiaries (including, without limitation, as
a result of a merger or consolidation) (each such acquisition in this
clause (h), a “Permitted Acquisition”); provided, that any single acquisition
may be effected through a combination of cash and non-cash consideration
permitted under subclauses (i) and (ii) hereunder, provided, further, that with
respect to each purchase or other acquisition made pursuant to this
Section 9.3(h):

 

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(A) each newly created or acquired Subsidiary shall have complied with the
requirements of Section 8.13 or made arrangements reasonably satisfactory to the
Administrative Agent for compliance within ten (10) Business Days after the
effectiveness of such Permitted Acquisition;

(B) the Borrower shall have certified on or before the closing date of such
acquisition in writing and in a form reasonably acceptable to the Administrative
Agent, that such acquisition has been approved by the board of directors (or
equivalent governing body) of the Person to be acquired (to the extent such
approval is necessary);

(C) solely in the case and to the extent of purchases and acquisitions made
pursuant to Section 9.3(h)(ii), the total cash and noncash consideration
(including, without limitation, the fair market value of all Capital Stock
issued or transferred to the sellers thereof, the amount (calculated in
accordance with GAAP at the time contracted for) of earn-outs and other
contingent payment obligations (except to the extent the payment obligations
with respect to any such earn-out or other contingent obligation has been
terminated or expired) to such sellers and all assumptions of Indebtedness in
connection therewith) paid by the Borrower and its Subsidiaries for any such
purchase or other acquisition when aggregated with the total cash and noncash
consideration paid by the Borrower and its Subsidiaries for all other Permitted
Acquisitions consummated after the Closing Date does not exceed $50,000,000;

(D) no later than two (2) Business Days (or such shorter period as may be
acceptable to the Administrative Agent) prior to the proposed closing date of
such acquisition, the Borrower shall have delivered to the Administrative Agent
an Officer’s Compliance Certificate for the most recent fiscal quarter end
preceding such acquisition for which financial statements are available
demonstrating in form and substance reasonably satisfactory to the
Administrative Agent certifying that immediately after giving effect to such
acquisition and any Indebtedness incurred or repaid in connection therewith
(A) the Borrower is in compliance on a Pro Forma Basis with each covenant
contained in Section 9.14, (B) the Consolidated Total Leverage Ratio calculated
on a Pro Forma Basis shall not be greater than 4.25 to 1.00, and (C) the unused
portion of the Aggregate Commitment is greater than or equal to $15,000,000;

(E) no later than ten (10) Business Days (or such later time as may be
reasonably acceptable to the Administrative Agent) after the proposed closing
date or such acquisition, the Borrower, to the extent requested by the
Administrative Agent, shall have delivered to the Administrative Agent promptly
upon the finalization thereof copies of the final Permitted Acquisition
Documents;

(F) no Default or Event of Default shall have occurred and be continuing both
immediately before and after giving effect to such acquisition; and

 

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(G) the Borrower shall have delivered to the Administrative Agent at least one
(1) Business Day (or such later time as may be reasonably acceptable to the
Administrative Agent) prior to the date on which any such Permitted Acquisition
is to be consummated, a certificate of a Responsible Officer, in form and
substance reasonably satisfactory to the Administrative Agent, certifying that
all of the requirements set forth in this Section 9.3(h) have been satisfied or
will be satisfied on or prior to the consummation of such Permitted Acquisition.

(i) (i) Investments in the form of loans and advances to officers, directors and
employees in the ordinary course of business in an aggregate amount not to
exceed at any time outstanding $2,500,000 and (ii) Investments constituting
loans to employees of the Borrower and its Subsidiaries to purchase Capital
Stock of the Borrower not exceeding in the aggregate $5,000,000 at any time
outstanding; and

(j) Investments in the form of intercompany Indebtedness permitted pursuant to
Section 9.1(g);

(k) Guaranty Obligations permitted pursuant to Section 9.1;

(l) Investments in joint ventures or partnerships; provided, that the aggregate
amount of all such Investments shall not at any time exceed $20,000,000;

(m) Investments in the form of accounts receivable arising, and trade credit
granted, in the ordinary course of business and any securities received in
satisfaction or partial satisfaction thereof from financially troubled account
debtors to the extent reasonably necessary in order to prevent or limit loss;

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

(o) Investments constituting deposits made in the ordinary course consistent
with past practice to secure the performance of leases;

(p) promissory notes and other non-cash consideration received in connection
with dispositions permitted by Section 9.5;

(q) Investments of any Person existing at the time such Person becomes a
Subsidiary or consolidates or merges with any Credit Party or any of its
Subsidiaries so long as such Investments were not made in contemplation of such
Person becoming a Subsidiary or of such consolidation or merger;

(r) the issuance of any letters of credit, bank guarantees or similar
instruments permitted under Section 9.1 for the account of the Borrower or any
Subsidiary and benefitting any joint venture, partnership or any other Person;
and

(s) other Investments in an aggregate amount not to exceed the greater of
(i) $15,000,000 and (ii) 8% of Tangible Net Worth at any time outstanding.

 

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For purposes of determining the amount of any Investment outstanding for
purposes of this Section 9.3, such amount shall be deemed to be the amount of
such Investment when made or acquired (without adjustment for subsequent
increases or decreases in the value of such Investment) less any amount realized
in respect of such Investment upon the sale, collection, distribution, return of
capital or repayment of principal (not to exceed the original amount invested).

SECTION 9.4 Fundamental Changes. Merge, consolidate or enter into any similar
combination with any other Person or liquidate, wind-up or dissolve itself (or
suffer any liquidation or dissolution) except:

(a) (i) any Subsidiary of the Borrower may be merged, amalgamated or
consolidated with or into the Borrower (provided that the Borrower shall be the
continuing or surviving entity) or (ii) any Subsidiary of the Borrower may be
merged, amalgamated or consolidated with or into any Subsidiary Guarantor
(provided that the Subsidiary Guarantor shall be the continuing or surviving
entity or, the continuing or surviving entity shall become a Subsidiary
Guarantor and the Borrower shall comply with Section 8.13 in connection
therewith);

(b) (i) any Non-Guarantor Subsidiary may be merged, amalgamated or consolidated
with or into, or be liquidated into, any other Non-Guarantor Subsidiary and
(ii) any Subsidiary of the Borrower may liquidate or dissolve, or any Subsidiary
may (if the perfection and priority of the Liens securing the Obligations is not
adversely affected thereby) change its legal form (it being understood that in
the case of any dissolution of a Subsidiary Guarantor, such Subsidiary shall at
or before the time of such dissolution transfer its assets to another Subsidiary
Guarantor unless such disposition of assets is permitted hereunder; and in the
case of any change in legal form, a Subsidiary Guarantor will remain a Guarantor
unless such Guarantor is otherwise permitted to cease being a Guarantor
hereunder);

(c) any Subsidiary may dispose of all or substantially all of its assets (upon
voluntary liquidation, dissolution, winding up or otherwise) to the Borrower or
any Subsidiary Guarantor; provided that, with respect to any such disposition by
any Non-Guarantor Subsidiary, the consideration for such disposition shall not
exceed the fair value of such assets;

(d) any Non-Guarantor Subsidiary may dispose of all or substantially all of its
assets (upon voluntary liquidation, dissolution, winding up or otherwise) to any
other Non-Guarantor Subsidiary;

(e) a merger, dissolution, liquidation, consolidation, amalgamation or
disposition, the purpose of which is to effect a disposition permitted by
Section 9.5;

(f) any Subsidiary of the Borrower may merge, amalgamate or consolidate with, or
dissolve into, any other Person in order to effect or to the extent constituting
an Investment permitted pursuant to Section 9.3; provided that the continuing or
surviving Person shall, to the extent subject to the terms hereof, have complied
with the requirements of Section 8.13; and

(g) any Person may merge into the Borrower in connection with a Permitted
Acquisition; provided that the continuing or surviving Person shall be the
Borrower.

 

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SECTION 9.5 Asset Dispositions. Make any Asset Disposition except:

(a) the disposition of obsolete, worn-out or surplus assets no longer used or
usable in the business of the Borrower or any of its Subsidiaries (including
allowing any registrations or any applications for registrations of any
immaterial intellectual property to lapse or go abandoned);

(b) non-exclusive licenses and sublicenses of intellectual property rights in
the ordinary course of business not interfering, individually or in the
aggregate, in any material respect with the conduct of the business of the
Borrower and its Subsidiaries;

(c) leases, subleases, licenses or sublicenses of Property (including vessels)
granted by any Borrower or any of its Subsidiaries to others in the ordinary
course of business;

(d) dispositions of Property to the extent that (i) such Property is exchanged
for credit against the purchase price of similar replacement property or
(ii) the proceeds of such disposition are promptly applied to the purchase price
of such replacement Property; provided that, to the extent such disposition
includes a disposition of a Designated Vessel, such disposition complies with
the conditions to vessel substitution set forth in Section 4.2;

(e) (i) dispositions permitted by Section 9.4 (other than Section 9.4(e)),
(ii) Investments permitted by Section 9.3 (other than Section 9.3(p)) and
(iii) Restricted Payments permitted by Section 9.6;

(f) dispositions by the Borrower and its Subsidiaries of property pursuant to
sale-leaseback transactions; provided that (i) such disposition is for an amount
not less than the fair market value thereof (as determined by the Borrower in
its reasonable judgment) and (ii) 100% of the consideration for such disposition
shall be cash consideration;

(g) dispositions in connection with Insurance and Condemnation Events; provided
that the requirements of Section 2.4(b)(ii) are complied with in connection
therewith;

(h) dispositions of accounts receivables arising from projects performed outside
of the United States or Canada;

(i) sales, disposition or contributions of property by Credit Parties to any
Subsidiary of the Borrower that is not a Credit Party, provided that (A) the
portion (if any) of any such disposition made for less than fair market value
and (B) any non-cash consideration received in exchange for any such
disposition, shall in each case constitute an Investment in such Subsidiary; and

(j) Asset Dispositions not otherwise permitted pursuant to this Section;
provided that (i) at the time of such Asset Disposition, no Default or Event of
Default shall exist or would result from such Asset Disposition, (ii) such Asset
Disposition is made for fair market value, (iii) the consideration received for
each such Asset Disposition shall either (A) consist of at least 85% cash
consideration or (B) consist of at least 25% cash consideration with the
non-cash consideration consisting of a senior promissory note (or similar
instrument or obligation) that is secured by a first priority perfected Lien on
the Property subject to such Asset Disposition, and

 

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(iv) the aggregate fair market value of all property disposed of in reliance on
this clause (j) shall not exceed $15,000,000 in any Fiscal Year; provided, that,
prior to the occurrence of the Springing Lien Termination Date, to the extent
that such Asset Disposition constitutes the sale of a Designated Vessel, the
Borrower has provided Substituted Vessel(s) in substitution of any such
Designated Vessel such that the conditions to a vessel substitution set forth in
Section 4.2 have been satisfied prior to the effectiveness of such sale.

SECTION 9.6 Restricted Payments. (a) Declare or pay any dividend on, or make any
payment or other distribution on account of, or purchase, redeem, retire or
otherwise acquire (directly or indirectly), or set apart assets for a sinking or
other analogous fund for the purchase, redemption, retirement or other
acquisition of, any class of Capital Stock of any Credit Party or any Subsidiary
thereof, (b) make any distribution of cash, property or assets to the holders of
shares of any Capital Stock of any Credit Party or any Subsidiary thereof, or
(c) make any voluntary or mandatory redemption, repurchase, retirement, sinking
fund payment or other payment of principal with respect to any Subordinated
Indebtedness or the Note Indenture Obligations, or any voluntary payment or
other prepayment of interest with respect to any Subordinated Indebtedness or
the Note Indenture Obligations (other than in each case, in connection with a
Permitted Note Refinancing) (the foregoing clauses (a) through (c),
collectively, the “Restricted Payments”) provided that:

(i) each Subsidiary of the Borrower may make Restricted Payments to the Borrower
and any Subsidiary of the Borrower (and, in the case of a Restricted Payment by
a non-wholly-owned Subsidiary of the Borrower, to the Borrower, any Subsidiary
of the Borrower and to each other owner of Capital Stock of such Subsidiary
based on their relative ownership interests);

(ii) the Borrower and each Subsidiary of the Borrower may declare and make
dividend payments or other distributions payable solely in the Capital Stock
(other than Disqualified Capital Stock) of such Person;

(iii) the Borrower may make Restricted Payments with the net cash proceeds from
any substantially concurrent sale or issuance of Capital Stock (other than
Disqualified Capital Stock) of the Borrower;

(iv) to the extent constituting Restricted Payments, the Borrower and its
Subsidiaries may enter into transactions expressly permitted by Section 9.3 or
9.4;

(v) Restricted Payments to redeem, retire or otherwise acquire Capital Stock or
options or other equity or phantom equity in respect of Capital Stock from
present and former directors, employees or members of management of the Borrower
or any Subsidiary of the Borrower (or their estate, family members, spouse
and/or former spouse) in connection with the resignation, termination, death or
disability of any such director, employee or member of management, in an
aggregate amount not to exceed (A) $3,000,000 in any Fiscal Year (the “Employee
Redemption Payment Cap”) plus any unused portion of the Employee Redemption
Payment Cap from a previous Fiscal Year and (B) $6,000,000 for all such
Restricted Payments made after the Closing Date, provided that the amount set
forth in this clause (v) may be further increased by the cash proceeds of any
key-man life insurance maintained by the Borrower or any of its Subsidiaries;

 

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(vi) to the extent constituting Restricted Payments, repurchases of Capital
Stock of the Borrower deemed to occur upon the non-cash exercise of stock
options and warrants or similar equity incentive awards;

(vii) the Borrower may declare and make (A) Restricted Payments in an aggregate
amount during any Fiscal Year not to exceed an aggregate amount equal to
(1) $7,500,000 (the “Restricted Payment Cap”) plus (2) 100% of any unused
portion of the Restricted Payment Cap from the immediately preceding Fiscal
Year, if after giving effect to such Restricted Payment, the Borrower’s
Consolidated Total Leverage Ratio as of the end of the most recent fiscal
quarter for which financial statements have been or were required to be
delivered as of the date such Restricted Payment is to be made would be greater
than 2.50 to 1.00; provided, that the Borrower shall use the entire amount of
the Restricted Payment Cap allocated to such Fiscal Year prior to using any of
the unused portion of the Restricted Payment Cap allowed to be carried forward
from the immediately preceding Fiscal Year and (B) additional Restricted
Payments if after giving effect to such Restricted Payment, the Borrower’s
Consolidated Total Leverage Ratio as of the end of the most recent fiscal
quarter for which financial statements have been or were required to be
delivered as of the date of such Restricted Payment is to be made would be less
than or equal to 2.50 to 1.00; provided, further, that the aggregate amount of
Restricted Payments made pursuant to this clause (vii) after the Closing Date
with respect to Subordinated Indebtedness shall not exceed the Threshold Amount.

(viii) the Borrower or any Subsidiary of the Borrower may (A) pay cash in lieu
of fractional shares in connection with any dividend, split or combination
thereof or any Permitted Acquisition and (B) honor any conversion request by a
holder of convertible Indebtedness and make cash payments in lieu of fractional
shares in connection with any such conversion;

(ix) the Borrower may pay dividends and distributions within sixty (60) days
after the date of declaration thereof, if at the date of declaration of such
payment, such payment would have complied with the other provisions of this
Section 9.6;

(x) the Borrower or any Subsidiary of the Borrower may refinance, refund, renew,
extend or exchange any Subordinated Indebtedness permitted by Section 9.1(i) and
(l), and by any subordination agreement applicable thereto; and

(xi) the Borrower or any Subsidiary of the Borrower may pay interest, expenses
and indemnities in respect of Subordinated Indebtedness incurred under
Section 9.1(i) and (l) (other than any such payments prohibited by the
subordination provisions thereof).

 

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SECTION 9.7 Transactions with Affiliates. Directly or indirectly enter into any
transaction, including, without limitation, any purchase, sale, lease or
exchange of Property, the rendering of any service or the payment of any
management, advisory or similar fees, with any officer or other Affiliate of,
the Borrower or any of its Subsidiaries, other than:

(i) any transaction among the Credit Parties or among the Borrower and its
wholly-owned Subsidiaries;

(ii) transactions permitted by Sections 9.1, 9.3, 9.4, 9.5, 9.6 and 9.13;

(iii) transactions existing on the Closing Date and described on Schedule 9.7;

(iv) other transactions in the ordinary course of business on terms as favorable
as would be obtained by it on a comparable arm’s-length transaction with an
independent, unrelated third party; provided, that, in the case of any such
transaction involving aggregate consideration or Property having a fair market
value in excess of the Threshold Amount, such transaction shall have been
determined in good faith by the board of directors (or equivalent governing
body) of the Borrower as having satisfied the standard described in this
clause (v);

(v) any employment or severance agreement, compensation, employee benefit
arrangements and incentive arrangements or indemnification agreement or
arrangement with any officer, director, member or employee entered into by the
Borrower or any of its Subsidiaries in the ordinary course of business;

(vi) payment of reasonable directors fees and customary indemnification
agreements with directors, members, officers and employees of the Borrower and
its Subsidiaries and reasonable out-of-pocket costs of such Persons may be
reimbursed;

(vii) loans and advances to officers, directors and employees of the Company or
any Subsidiary for travel, entertainment, moving and other relocation expenses,
in each case made in the ordinary course of business;

(viii) any transaction among Non-Guarantor Subsidiaries; and

(ix) transactions between the Borrower or any of its Subsidiaries and any Person
that is an Affiliate solely due to the fact that a director of such Person is
also a director of the Borrower, provided that such director abstains from
voting as a director of the Borrower on any matter involving such other Person.

SECTION 9.8 Accounting Changes; Organizational Documents.

(a) With respect to the Credit Parties in existence on the Closing Date, change
the Fiscal Year end for any such Credit Party.

(b) Amend, modify or change its articles of incorporation (or corporate charter
or other similar organizational documents) or amend, modify or change its bylaws
(or other similar documents) in any manner materially adverse to the rights or
interests of the Lenders.

 

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SECTION 9.9 Modifications of Material Agreements. Amend, modify, waive or
supplement (or permit the modification, amendment, waiver or supplement of) any
of the terms or provisions of (i) the Note Indenture, other than any
modification, amendment, waiver or supplement which, if effected pursuant to a
refinancing of the obligations under the Note Indenture would constitute a
“Permitted Note Refinancing,” or (ii) any Subordinated Indebtedness in any
respect which would materially and adversely affect the rights or interests of
the Administrative Agent and the Lenders hereunder.

SECTION 9.10 No Further Negative Pledges; Restrictive Agreements.

(a) Enter into, assume or be subject to any agreement prohibiting or otherwise
restricting the creation or assumption of any Lien upon its properties or
assets, whether now owned or hereafter acquired, or requiring the grant of any
security for such obligation if security is given for some other obligation,
except: (i) pursuant to this Agreement and the other Loan Documents;
(ii) pursuant to any document or instrument governing Indebtedness incurred
pursuant to Section 9.1(d); provided, that any such restriction contained
therein relates only to the Property (and replacements and accessions to such
Property) financed by such Indebtedness and the proceeds and products thereof;
(iii) restrictions contained in the organizational documents of any Credit Party
as of the Closing Date; (iv) restrictions in connection with any Permitted Lien
permitted under Section 9.2(h) or any document or instrument governing any such
Permitted Lien; provided, that any such restriction contained therein relates
only to Property (and replacements and accessions to such Property, and the
proceeds and products thereof) subject to such Permitted Lien; (v) restrictions
contained in the Wells Fargo Documents, the Note Indenture, and any agreement,
document or instrument evidencing or governing any Permitted Note Refinancing;
(vi) negative pledges and restrictions in favor of any holder of Indebtedness to
the extent it constitutes Indebtedness of a type permitted under Section 9.1(e),
but solely to the extent any restriction relates to the property financed by or
the subject of such Indebtedness; (vii) customary restrictions in leases,
subleases, licenses or asset sale agreements otherwise permitted hereby, so long
as such restrictions relate solely to the assets subject thereto;
(viii) restrictions arising in connection with cash and other deposits permitted
under Section 9.2 or 9.3 and limited to such cash or deposit; (ix) customary
provisions restricting assignment of any agreement entered into in the ordinary
course of business; (x) customary provisions restricting the subletting,
sub-charter or assignment of any lease or charter; (xi) customary provisions in
joint venture agreements and other similar agreements applicable to joint
ventures otherwise permitted under this Agreement which are entered into in the
ordinary course of business relating solely to the assets and equity interests
of such joint venture; (xii) restrictions imposed by applicable law; and
(xiii) restrictions contained in Indebtedness permitted pursuant to
Section 9.1(b), (i), (k) and (t), in each case, to the extent no more
restrictive to the Borrower and its Subsidiaries than the covenants contained in
this Agreement and provided that such restrictions do not restrict Liens on the
Collateral, or the Property that would constitute Collateral, as contemplated by
the Loan Documents or the first priority status thereof, and do not include
equal and ratable clauses with respect to Liens on the Collateral, or the
Property that would constitute Collateral; provided that any such restriction
imposed by Subordinated Indebtedness permitted pursuant to Section 9.1(i) shall
be less restrictive than those in this Agreement in a manner consistent with
customary restrictions in senior and subordinated debt instruments.

 

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(b) Enter into, assume or be subject to any agreement prohibiting or otherwise
restricting the ability of any Credit Party or any Subsidiary thereof to:

(i) make Restricted Payments to the Borrower or any Subsidiary Guarantor, to
make to or repay intercompany Indebtedness to the Borrower or any Subsidiary
Guarantor, or to otherwise transfer property to or invest in the Borrower or any
Subsidiary Guaranty, except: (A) pursuant to this Agreement and the other Loan
Documents; (B) restrictions imposed by Applicable Law; (C) pursuant to any
document or instrument governing Indebtedness incurred pursuant to
Section 9.1(d) (provided, that any such restriction contained therein relates
only to the Property (and replacements and accessions to such Property) financed
by such Indebtedness and the proceeds and products thereof); (D) any Permitted
Lien or any document or instrument governing any Permitted Lien (provided, that
any such restriction contained therein relates only to Property (and
replacements and accessions to such Property, and the proceeds and products
thereof) subject to such Permitted Lien); (E) restrictions that are binding on a
Subsidiary at the time such Subsidiary first becomes a Subsidiary of the
Borrower, so long as such restrictions are not entered into in contemplation of
such Person becoming a Subsidiary; (F) customary restrictions contained in an
agreement related to the sale of Property (to the extent such sale is permitted
pursuant to Section 9.5) that limit the transfer of such Property pending the
consummation of such sale; (G) restrictions in any agreement in connection with
a disposition of all or substantially all of the Capital Stock or assets of any
Subsidiary permitted by Section 9.5 (provided, that any such restriction
contained therein relates only to the Property (and replacements and accessions
to such Property, and the proceeds and products thereof) subject to such
disposition); (H) customary provisions in joint venture agreements or other
similar agreements applicable to joint ventures otherwise permitted under this
Agreement which are entered into in the ordinary course of business and
applicable solely to such joint venture; (I) customary net worth provisions
contained in real property leases entered into by the Borrower or any of its
Subsidiaries in the ordinary course of business, so long as the Borrower has
determined in good faith that such net worth provisions would not reasonably be
expected to impair the ability of the Borrower and its Subsidiaries to meet
their ongoing obligations, including without limitation, the Facility
Obligations; (J) restrictions contained in Indebtedness permitted pursuant to
Sections 9.1(b), (i), (k) and (t), in each case, to the extent no more
restrictive to the Borrower and its Subsidiaries than the covenants contained in
this Agreement; provided that any such restriction imposed by Subordinated
Indebtedness permitted pursuant to Section 9.1(i) shall be less restrictive than
those in this Agreement in a manner consistent with customary restrictions in
senior and subordinated debt instruments; (K) customary restrictions in leases,
subleases, charters, sub-charters, licenses and sublicenses or asset sale
agreements otherwise permitted by this Agreement so long as such restrictions
relate only to the assets subject thereto; (L) customary provisions restricting
assignment of any agreement entered into in the ordinary course of business; and
(M) restrictions contained in the Wells Fargo Documents, the Note Indenture, and
any agreement, document or instrument evidencing or governing any Permitted Note
Refinancing; or

 

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(ii) act as a Subsidiary Guarantor under the Subsidiary Guaranty Agreement,
except (A) pursuant to this Agreement and the other Loan Documents, and
(B) restrictions imposed by Applicable Law.

SECTION 9.11 Nature of Business. Engage in any material line of business
substantially different from those lines of business conducted by the Borrower
and its Subsidiaries on the date hereof or any business reasonably related,
complementary, synergistic or ancillary thereto or reasonable extensions
thereof.

SECTION 9.12 Sale Leasebacks. Except for transactions permitted pursuant to
Section 9.5, become liable, directly or by way of any Guaranty Obligation, with
respect to any lease of any property (whether real or personal or mixed) whether
now owned or hereafter acquired, (i) which any Credit Party has sold or
transferred or is to sell or transfer to any other Person, or (ii) which any
Credit Party intends to use for substantially the same purposes as any other
property which has been or is to be sold or transferred by that entity to any
other Person in connection with such lease.

SECTION 9.13 Lease Obligations. The Borrower shall not and shall not permit any
of its Subsidiaries to, enter into any Operating Lease with respect to any real
or personal property (or any interest therein), except (i) Operating Leases
which, together with all other such arrangements (excluding those described in
clauses (ii) and (iii) below) which shall then be in effect, will not require
the payment of an aggregate amount of rentals by the Borrower and its
Subsidiaries (determined on a consolidated basis) in excess of the greater of
(A) $25,000,000 and (B) 5% of the consolidated revenues of the Borrower and its
Subsidiaries (as reflected in the most recent financial statements of the
Borrower and its Subsidiaries delivered pursuant to Section 8.1) for any Fiscal
Year, (ii) Operating Leases for not more than eighteen (18) months and
(iii) Operating Leases in connection with the performance of specific projects
for the period of such projects; provided, however, that any calculation made
for purposes of this section shall exclude any amounts required to be expended
for maintenance, repairs, insurance, taxes, assessments, and other similar
charges. For the avoidance of doubt, Synthetic Leases shall be treated as
Operating Leases for purposes of determining compliance with this Section 9.13.

SECTION 9.14 Financial Covenants.

(a) Consolidated Total Leverage Ratio. As of the last day of any fiscal quarter
of the Borrower, permit the Consolidated Total Leverage Ratio to be greater than
4.50 to 1.00.

(b) Consolidated Fixed Charge Coverage Ratio. As of the last day of any fiscal
quarter of the Borrower, permit the Consolidated Fixed Charge Coverage Ratio to
be less than 1.25 to 1.00.

ARTICLE X

DEFAULT AND REMEDIES

SECTION 10.1 Events of Default. Each of the following shall constitute an Event
of Default:

 

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(a) Default in Payment of Principal of Loans and Reimbursement Obligations. The
Borrower shall default in any payment of principal of any Loan or Reimbursement
Obligation when and as due (whether at maturity, by reason of acceleration or
otherwise).

(b) Other Payment Default. The Borrower or any other Credit Party shall default
in the payment when and as due (whether at maturity, by reason of acceleration
or otherwise) of interest on any Loan or Reimbursement Obligation or the payment
of any other Obligation, and such default shall continue for a period of five
(5) Business Days.

(c) Misrepresentation. Any representation, warranty, certification or statement
of fact made or deemed made by or on behalf of any Credit Party in this
Agreement, in any other Loan Document, or in any document required to be
delivered in connection herewith or therewith that is subject to materiality or
Material Adverse Effect qualifications, shall be incorrect or misleading in any
respect when made or deemed made or any representation, warranty, certification
or statement of fact made or deemed made by or on behalf of any Credit Party in
this Agreement, any other Loan Document, or in any document required to be
delivered in connection herewith or therewith that is not subject to materiality
or Material Adverse Effect qualifications, shall be incorrect or misleading in
any material respect when made or deemed made.

(d) Default in Performance of Certain Covenants.

(i) Any Credit Party shall default in the performance or observance of any
covenant or agreement contained in Article IV (other than Section 4.6),
Section 8.1, 8.3, 8.4, or 8.14, or Article IX;

(ii) Any Credit Party shall default in the performance or observance of any
covenant or agreement contained in Section 8.2, and such default shall continue
for a period of five (5) Business Days after the earlier of (A) the
Administrative Agent’s delivery of written notice thereof to the Borrower and
(B) a Responsible Officer of the Borrower having obtained knowledge thereof; or

(iii) Any Credit Party shall default in the performance or observe of any
covenant or agreement contained in Section 4.6, 8.12 or 8.13, and such default
shall continue for a period of ten (10) Business Days after the earlier of
(A) the Administrative Agent’s delivery of written notice thereof to the
Borrower and (B) a Responsible Officer of the Borrower having obtained knowledge
thereof.

(e) Default in Performance of Other Covenants and Conditions. Any Credit Party
shall default in the performance or observance of any covenant or agreement
contained in this Agreement (other than as specifically provided for in this
Section) or any other Loan Document and such default shall continue for a period
of thirty (30) days after the earlier of (i) the Administrative Agent’s delivery
of written notice thereof to the Borrower and (ii) a Responsible Officer of the
Borrower having obtained knowledge thereof.

(f) Indebtedness Cross-Default. Any Credit Party or any Subsidiary thereof shall
(i) default in the payment (beyond the applicable grace period with respect
thereto) of any Indebtedness (other than Indebtedness hereunder) having,
individually or in the aggregate, an

 

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outstanding principal amount (or, with respect to any Hedge Agreement, the Hedge
Termination Value) in excess of the Threshold Amount, or (ii) default in the
observance or performance of any other agreement or condition relating to any
such Indebtedness, or any other event shall occur or condition exist, the effect
of which default or other event or condition is to cause, or to permit the
holder or holders of such Indebtedness (or a trustee or agent on behalf of such
holder or holders) to cause, with the giving of notice and/or lapse of time, if
required, any such Indebtedness to become due prior to its stated maturity (any
applicable grace period having expired).

(g) Change in Control. Any Change in Control shall occur.

(h) Voluntary Bankruptcy Proceeding. Any Credit Party or any Subsidiary thereof
shall (i) commence a voluntary case under the federal bankruptcy laws (as now or
hereafter in effect), (ii) file a petition seeking to take advantage of any
other laws, domestic or foreign, relating to bankruptcy, insolvency,
reorganization, winding up or composition for adjustment of debts, (iii) consent
to or fail to contest in a timely and appropriate manner any petition filed
against it in an involuntary case under such bankruptcy laws or other laws,
(iv) apply for or consent to, or fail to contest in a timely and appropriate
manner, the appointment of, or the taking of possession by, a receiver,
custodian, trustee, or liquidator of itself or of a substantial part of its
property, domestic or foreign, (v) admit in writing its inability to pay its
debts as they become due, (vi) make a general assignment for the benefit of
creditors, or (vii) take any corporate action for the purpose of authorizing any
of the foregoing.

(i) Involuntary Bankruptcy Proceeding. A case or other proceeding shall be
commenced against any Credit Party or any Subsidiary thereof in any court of
competent jurisdiction seeking (i) relief under the federal bankruptcy laws (as
now or hereafter in effect) or under any other laws, domestic or foreign,
relating to bankruptcy, insolvency, reorganization, winding up or adjustment of
debts, or (ii) the appointment of a trustee, receiver, custodian, liquidator or
the like for any Credit Party or any Subsidiary thereof or for all or any
substantial part of their respective assets, domestic or foreign, and such case
or proceeding shall continue without dismissal or stay for a period of sixty
(60) consecutive days, or an order granting the relief requested in such case or
proceeding (including, but not limited to, an order for relief under such
federal bankruptcy laws) shall be entered.

(j) Failure of Agreements. (i) Any of the Loan Documents shall for any reason
(other than by reason of any action or inaction by the Administrative Agent or
any Lender) cease to be valid and binding on any Credit Party party thereto
(other than in accordance with the terms hereof or thereof) or any such Person
shall disavow its obligations under any of the Loan Documents, (ii) at any time
during a Perfection Period, any Lien intended to be created under any Security
Document ceases to be or is not valid and perfected in any respect (other than
pursuant to the terms thereof, including as a result of a transaction permitted
under Section 9.4 or 9.5 or by reason of any action or inaction by the
Administrative Agent or any Lender), or any such Lien shall not have the
purported priority contemplated by this Agreement or any of the other Loan
Documents, or (iii) any provision (other than any provision, the invalidity of
which is not adverse to the Lenders) of any Lender-Surety Agreement shall for
any reason (other than by reason of any action or inaction by the Administrative
Agent or any Lender) cease to be in full force and effect, other than in
accordance with its terms and such failure shall continue for a period of five
(5) Business Days after the Administrative Agent’s delivery of written notice
thereof to the Borrower.

 

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(k) ERISA Events. The occurrence of a Termination Event.

(l) Judgment. A judgment or order for the payment of money which causes the
aggregate amount of all such judgments or orders (net of any amounts paid or
fully covered by independent third party insurance as to which the relevant
insurance company does not dispute coverage) to exceed the Threshold Amount
shall be entered and is binding against any Credit Party or any Subsidiary
thereof by any court and such judgment or order shall continue without having
been discharged, vacated or stayed for a period of thirty (30) consecutive days
after the entry thereof.

(m) Bonding Agreement.

(i) Any Surety for the Borrower or any of its Subsidiaries with respect to any
marine construction or dredging contracts to be entered into by the Borrower or
any such Subsidiary for any reason ceases to issue such bonds, undertakings or
instruments of guaranty and (A) the Borrower and its Subsidiaries fail to cause
another Person reasonably acceptable to the Administrative Agent (provided that
any such Person shall be deemed to be acceptable if its bonds, undertakings or
instruments of guaranty are accepted by contract providers for the Borrower and
its Subsidiaries) to issue bonds, undertakings or instruments of guaranty within
90 days of the date that such original Surety ceased to issue bonds,
undertakings or instruments of guaranty, or (B) such denial, individually or in
the aggregate, could reasonably be expected to have a Material Adverse Effect;
or

(ii) (A) At any time, any Surety for the Borrower or any of its Subsidiaries
shall violate any term of the Lender-Surety Agreement to which it is a party,
which violation would adversely affect the rights or interests of the
Administrative Agent and the Lenders under the Loan Documents and such violation
shall continue for a period of five (5) Business Days after the Administrative
Agent’s delivery of written notice thereof to such Surety and the Borrower,
(B) any Surety exercises any rights or remedies as a secured party with respect
to any Collateral, or Property that would constitute Collateral, or (C) any
Surety takes possession of any Collateral, or Property that would constitute
Collateral, and such action continues for a period of ten (10) Business Days
after the earlier of (A) the Administrative Agent’s delivery of written notice
thereof to the Borrower and (B) a Responsible Officer of the Borrower having
obtained knowledge thereof; or

(iii) The Borrower or any of its Subsidiaries defaults in the payment when due
of any amount due under any Bonding Agreement or breaches or defaults with
respect to any other term of any Bonding Agreement, if the effect of such
failure to pay, default or breach is to cause the related Surety to take
possession of the work under any of the bonded contracts of the Borrower or any
of its Subsidiaries and such possession could reasonably be expected to result
in a Material Adverse Effect; or

 

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(iv) Any Credit Party breaches or defaults with respect to any term under any of
the bonded contracts of such Credit Party, if the effect of such default or
breach is to cause the related Surety to take possession of the work under such
bonded contract and such possession could reasonably be expected to result in a
Material Adverse Effect.

SECTION 10.2 Remedies. Upon the occurrence of an Event of Default, with the
consent of the Required Lenders, the Administrative Agent may, or upon the
request of the Required Lenders, the Administrative Agent shall, by notice to
the Borrower:

(a) Acceleration; Termination of Revolving Credit Facility. Terminate the
Aggregate Commitment and declare the principal of and interest on the Loans and
the Reimbursement Obligations at the time outstanding, and all other amounts
owed to the Lenders and to the Administrative Agent under this Agreement or any
of the other Loan Documents (including, without limitation, all L/C Obligations,
whether or not the beneficiaries of the then outstanding Letters of Credit shall
have presented or shall be entitled to present the documents required
thereunder) and all other Obligations, to be forthwith due and payable,
whereupon the same shall immediately become due and payable without presentment,
demand, protest or other notice of any kind, all of which are expressly waived
by each Credit Party, anything in this Agreement or the other Loan Documents to
the contrary notwithstanding, and terminate the Revolving Credit Facility and
any right of the Borrower to request borrowings or Letters of Credit thereunder;
provided, that upon the occurrence of an Event of Default specified in
Section 10.1(h) or (i), the Revolving Credit Facility shall be automatically
terminated and all Obligations shall automatically become due and payable
without presentment, demand, protest or other notice of any kind, all of which
are expressly waived by each Credit Party, anything in this Agreement or in any
other Loan Document to the contrary notwithstanding.

(b) Letters of Credit. With respect to all Letters of Credit with respect to
which presentment for honor shall not have occurred at the time of an
acceleration pursuant to the preceding paragraph, the Borrower shall at such
time deposit in a Cash Collateral account opened by the Administrative Agent
Cash Collateral in Dollars the Dollar Equivalent Amount equal to 105% of the
aggregate undrawn and unexpired amount of each such Letter of Credit. Amounts
held in such Cash Collateral account shall be applied by the Administrative
Agent to the payment of drafts drawn under such Letters of Credit, and the
unused portion thereof after all such Letters of Credit shall have expired or
been fully drawn upon, if any, shall be applied to repay the other Obligations
on a pro rata basis. After all such Letters of Credit shall have expired or been
fully drawn upon, the Reimbursement Obligation shall have been satisfied and all
other Obligations shall have been paid in full, the balance, if any, in such
Cash Collateral account shall be returned to the Borrower. The Administrative
Agent or the applicable Issuing Lender may, at any time and from time to time
after any initial deposit of Cash Collateral pursuant to the terms hereof,
request that additional Cash Collateral be provided in order to maintain such
105% coverage as a result of fluctuations in the Exchange Rate.

(c) General Remedies. Exercise on behalf of the Secured Parties all of its other
rights and remedies under this Agreement, the other Loan Documents and
Applicable Law, in order to satisfy all of the Obligations.

 

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SECTION 10.3 Rights and Remedies Cumulative; Non-Waiver; etc.

(a) The enumeration of the rights and remedies of the Administrative Agent and
the Lenders set forth in this Agreement is not intended to be exhaustive and the
exercise by the Administrative Agent and the Lenders of any right or remedy
shall not preclude the exercise of any other rights or remedies, all of which
shall be cumulative, and shall be in addition to any other right or remedy given
hereunder or under the other Loan Documents or that may now or hereafter exist
at law or in equity or by suit or otherwise. No delay or failure to take action
on the part of the Administrative Agent or any Lender in exercising any right,
power or privilege shall operate as a waiver thereof, nor shall any single or
partial exercise of any such right, power or privilege preclude any other or
further exercise thereof or the exercise of any other right, power or privilege
or shall be construed to be a waiver of any Event of Default. No course of
dealing between the Borrower, the Administrative Agent and the Lenders or their
respective agents or employees shall be effective to change, modify or discharge
any provision of this Agreement or any of the other Loan Documents or to
constitute a waiver of any Event of Default.

(b) Notwithstanding anything to the contrary contained herein or in any other
Loan Document, the authority to enforce rights and remedies hereunder and under
the other Loan Documents against the Credit Parties or any of them shall be
vested exclusively in, and all actions and proceedings at law in connection with
such enforcement shall be instituted and maintained exclusively by, the
Administrative Agent in accordance with Section 10.2 for the benefit of all the
Lenders and the Issuing Lenders; provided that the foregoing shall not prohibit
(a) the Administrative Agent from exercising on its own behalf the rights and
remedies that inure to its benefit (solely in its capacity as Administrative
Agent) hereunder and under the other Loan Documents, (b) any Issuing Lender or
the Swingline Lender from exercising the rights and remedies that inure to its
benefit (solely in its capacity as a Issuing Lender or Swingline Lender, as the
case may be) hereunder and under the other Loan Documents, (c) any Lender from
exercising setoff rights in accordance with Section 12.4 (subject to the terms
of Section 5.4), or (d) any Lender from filing proofs of claim or appearing and
filing pleadings on its own behalf during the pendency of a proceeding relative
to any Credit Party under any Debtor Relief Law; and provided, further, that if
at any time there is no Person acting as Administrative Agent hereunder and
under the other Loan Documents, then (i) the Required Lenders shall have the
rights otherwise ascribed to the Administrative Agent pursuant to Section 10.2
and (ii) in addition to the matters set forth in clauses (b), (c) and (d) of the
preceding proviso and subject to Section 5.4(d), any Lender may, with the
consent of the Required Lenders, enforce any rights and remedies available to it
and as authorized by the Required Lenders.

SECTION 10.4 Crediting of Payments and Proceeds. In the event that the
Obligations have been accelerated pursuant to Section 10.2 or the Administrative
Agent or any Lender has exercised any remedy set forth in this Agreement or any
other Loan Document, all payments received by the Lenders upon the Facility
Obligations and all net proceeds from the enforcement of the Facility
Obligations shall be applied:

First, to payment of that portion of the Facility Obligations constituting fees,
indemnities, expenses and other amounts, including reasonable out-of-pocket
attorney fees, payable to the Administrative Agent in its capacity as such, each
Issuing Lender in its capacity as such and the Swingline Lender in its capacity
as such, ratably among the Administrative Agent, the Issuing Lenders and
Swingline Lender in proportion to the respective amounts described in this
clause First payable to them;

 

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Second, to payment of that portion of the Facility Obligations constituting
fees, indemnities and other amounts (other than principal and interest) payable
to the Lenders under the Loan Documents, including reasonable out-of-pocket
attorney fees, ratably among the Lenders in proportion to the respective amounts
described in this clause Second payable to them;

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

Fourth, to payment of that portion of the Facility Obligations constituting
unpaid principal of the Loans, Reimbursement Obligations and payment obligations
then owing under Facility Hedge Agreements and Facility Cash Management
Agreements, ratably among the Lenders, the Issuing Lenders, the Hedge Banks and
the Cash Management Banks in proportion to the respective amounts described in
this clause Fourth held by them;

Fifth, to the Administrative Agent for the account of each Issuing Lender, to
Cash Collateralize any L/C Obligations then outstanding; and

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

Notwithstanding the foregoing, Facility Obligations arising under Facility Cash
Management Agreements and Facility Hedge Agreements shall be excluded from the
application described above if the Administrative Agent has not received written
notice thereof, together with such supporting documentation as the
Administrative Agent may request, from the applicable Cash Management Bank or
Hedge Bank, as the case may be. Each Cash Management Bank or Hedge Bank 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 Administrative Agent pursuant to the terms of Article XI for
itself and its Affiliates as if a “Lender” party hereto.

SECTION 10.5 Administrative Agent May File Proofs of Claim. In case of the
pendency of any proceeding under any Debtor Relief Law or any other judicial
proceeding relative to any Credit Party, the Administrative 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 Administrative Agent shall have made any demand on the Borrower)
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 Issuing
Lenders and the Administrative Agent (including any claim for the reasonable
compensation, expenses, disbursements and advances of the Lenders, the Issuing
Lenders and the Administrative Agent and their respective agents and counsel and
all other amounts due the Lenders, the Issuing Lenders and the Administrative
Agent under Sections 3.3, 5.3 and 12.3) allowed in such judicial proceeding; and

 

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

(c) and any custodian, receiver, assignee, trustee, liquidator, sequestrator or
other similar official in any such judicial proceeding is hereby authorized by
each Lender and each Issuing Lender to make such payments to the Administrative
Agent and, in the event that the Administrative Agent shall consent to the
making of such payments directly to the Lenders and the Issuing Lenders, to pay
to the Administrative Agent any amount due for the reasonable compensation,
expenses, disbursements and advances of the Administrative Agent and its agents
and counsel, and any other amounts due the Administrative Agent under
Sections 3.3, 5.3 and 12.3.

SECTION 10.6 Credit Bidding.

(a) The Administrative Agent, on behalf of itself and the Lenders, shall have
the right to credit bid and purchase for the benefit of the Administrative Agent
and the Lenders all or any portion of Collateral, or Property that would
constitute Collateral, at any sale thereof conducted by the Administrative Agent
under the provisions of the UCC, including pursuant to Sections 9-610 or 9-620
of the UCC, at any sale thereof conducted under the provisions of the United
States Bankruptcy Code, including Section 363 thereof, or a sale under a plan of
reorganization, or at any other sale or foreclosure conducted by the
Administrative Agent (whether by judicial action or otherwise) in accordance
with Applicable Law.

(b) Each Lender hereby agrees that, except as otherwise provided in any Loan
Documents or with the written consent of the Administrative Agent and the
Required Lenders, it will not take any enforcement action, accelerate
obligations under any Loan Documents, or exercise any right that it might
otherwise have under applicable law to credit bid at foreclosure sales, UCC
sales or other similar dispositions of Collateral, or Property that would
constitute Collateral.

ARTICLE XI

THE ADMINISTRATIVE AGENT

SECTION 11.1 Appointment and Authority.

(a) Each of the Lenders and each Issuing Lender hereby irrevocably designates
and appoints Wells Fargo to act on its behalf as the Administrative Agent
hereunder and under the other Loan Documents and authorizes the Administrative
Agent to take such actions on its behalf and to exercise such powers as are
delegated to the Administrative 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 Administrative
Agent, the Lenders and the Issuing Lenders, and neither the Borrower nor any
Subsidiary thereof shall, except as expressly set forth in this Article, have
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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
Administrative 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.

(b) The Administrative Agent shall also act as the “collateral agent” under the
Loan Documents, and each of the Lenders (including in its capacity as a
potential Hedge Bank or Cash Management Bank) and each Issuing Lender hereby
irrevocably appoints and authorizes the Administrative Agent to act as the agent
of such Lender and such Issuing Lender for purposes of acquiring, holding and
enforcing any and all Liens on Collateral granted by any of the Credit Parties
to secure any of the Facility Obligations, together with such powers and
discretion as are reasonably incidental thereto (including, without limitation,
to enter into additional Loan Documents or supplements to existing Loan
Documents on behalf of the Secured Parties). In this connection, the
Administrative Agent, as “collateral agent” and any co-agents, sub-agents and
attorneys-in-fact appointed by the Administrative Agent pursuant to this
Article XI for purposes of holding or enforcing any Lien on the Collateral (or
any portion thereof) granted under the Security Documents, or for exercising any
rights and remedies thereunder at the direction of the Administrative Agent),
shall be entitled to the benefits of all provisions of this Articles XI and XII
(including Section 12.3, as though such co-agents, sub-agents and
attorneys-in-fact were the “collateral agent” under the Loan Documents) as if
set forth in full herein with respect thereto.

SECTION 11.2 Rights as a Lender. The Person serving as the Administrative Agent
hereunder shall have the same rights and powers in its capacity as a Lender as
any other Lender and may exercise the same as though it were not the
Administrative Agent and the term “Lender” or “Lenders” shall, unless otherwise
expressly indicated or unless the context otherwise requires, include the Person
serving as the Administrative 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 the Borrower or any
Subsidiary or other Affiliate thereof as if such Person were not the
Administrative Agent hereunder and without any duty to account therefor to the
Lenders.

SECTION 11.3 Exculpatory Provisions.

(a) The Administrative Agent shall not have any duties or obligations except
those expressly set forth herein and in the other Loan Documents. Without
limiting the generality of the foregoing, the Administrative Agent:

(i) shall not be subject to any fiduciary or other implied duties, regardless of
whether a 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 Administrative 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

 

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Documents), provided that the Administrative Agent shall not be required to take
any action that, in its opinion or the opinion of its counsel, may expose the
Administrative 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

(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 the Borrower or any of its Affiliates that
is communicated to or obtained by the Person serving as the Administrative Agent
or any of its Affiliates in any capacity.

(b) The Administrative 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
Administrative Agent shall believe in good faith shall be necessary, under the
circumstances as provided in Section 12.2 and Section 10.2) or (ii) in the
absence of its own gross negligence or willful misconduct as determined by a
court of competent jurisdiction by final nonappealable judgment. The
Administrative Agent shall be deemed not to have knowledge of any Default unless
and until written notice describing such Default is given to the Administrative
Agent by the Borrower, a Lender or an Issuing Lender.

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

SECTION 11.4 Reliance by the Administrative Agent. The Administrative Agent
shall be entitled to rely upon, and shall not incur any liability for relying
upon, any notice, request, certificate, consent, statement, instrument, document
or other writing (including any certification submitted by the Borrower with
respect to the confirmation of the conditions to the occurrence of a Release
Date or the Springing Lien Termination Date, 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
Administrative 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 of a Letter of
Credit, that by its terms must be fulfilled to the satisfaction of a Lender or
an Issuing Lender, the Administrative Agent may presume that such condition is
satisfactory to such Lender or such Issuing Lender unless the Administrative
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such Lender or such Issuing Lender prior to the making of such Loan or the
issuance of such Letter of Credit. The Administrative Agent may consult with
legal counsel (who may be counsel for the Borrower), independent accountants and
other experts selected by it, and shall not be liable for any action taken or
not taken by it in accordance with the advice of any such counsel, accountants
or experts.

SECTION 11.5 Delegation of Duties. The Administrative 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
Administrative Agent. The Administrative Agent and any such sub agent may
perform any and all of its duties and exercise its rights and powers by or
through their respective Related Parties. The exculpatory provisions of this
Article shall apply to any such sub agent and to the Related Parties of the
Administrative Agent and any such sub agent, and shall apply to their respective
activities in connection with the syndication of the Revolving Credit Facility
as well as activities as Administrative Agent. The Administrative 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
non-appealable order that any direct (as opposed to indirect, special, punitive,
consequential or exemplary) damages suffered by the Borrower or any of its
Subsidiaries were caused by the Administrative Agent’s gross negligence or
willful misconduct.

SECTION 11.6 Resignation of Administrative Agent.

(a) The Administrative Agent may at any time give notice of its resignation to
the Lenders, the Issuing Lenders and the Borrower. Upon receipt of any such
notice of resignation, the Required Lenders shall have the right, with the
consent of the Borrower, to appoint a successor, which shall be a bank with an
office in the United States, or an Affiliate of any such bank with an office in
the United States. If no such successor shall have been so appointed by the
Required Lenders and shall have accepted such appointment within 30 days after
the retiring Administrative 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 Administrative Agent may (but shall not be
obligated to), on behalf of the Lenders and the Issuing Lenders, appoint a
successor Administrative 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 Administrative Agent is a Defaulting Lender
pursuant to clause (d) of the definition thereof, the Required Lenders and the
Borrower may, to the extent permitted by Applicable Law, by notice in writing to
such Person, remove such Person as the Administrative Agent and, the Required
Lenders and the Borrower may 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 Administrative Agent shall be
discharged from its duties and obligations hereunder and under the other Loan
Documents (except that in the case of

 

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any collateral security held by the Administrative Agent on behalf of the
Lenders or the Issuing Lenders under any of the Loan Documents, the retiring or
removed Administrative Agent shall continue to hold such collateral security
until such time as a successor Administrative Agent is appointed) and (2) except
for any indemnity payments owed to the retiring or removed Administrative Agent,
all payments, communications and determinations provided to be made by, to or
through the Administrative Agent shall instead be made by or to each Lender and
each Issuing Lender directly, until such time, if any, as the Required Lenders
appoint a successor Administrative Agent as provided for above. Upon the
acceptance of a successor’s appointment as Administrative Agent hereunder, such
successor shall succeed to and become vested with all of the rights, powers,
privileges and duties of the retiring or removed Administrative Agent (other
than any rights to indemnity payments owed to the retiring or removed
Administrative Agent), and the retiring or removed Administrative Agent shall be
discharged from all of its duties and obligations hereunder or under the other
Loan Documents. The fees payable by the Borrower to a successor Administrative
Agent shall be the same as those payable to its predecessor unless otherwise
agreed between the Borrower and such successor. After the retiring or removed
Administrative Agent’s resignation or removal hereunder and under the other Loan
Documents, the provisions of this Article and Section 12.3 shall continue in
effect for the benefit of such retiring or removed Administrative Agent, its
sub-agents and their respective Related Parties in respect of any actions taken
or omitted to be taken by any of them while the retiring or removed
Administrative Agent was acting as Administrative Agent.

(d) Any resignation by Wells Fargo (or any successor or assignee thereof) as
Administrative Agent pursuant to this Section shall also constitute its
resignation as an Issuing Lender and Swingline Lender. Upon the acceptance of a
successor’s appointment as Administrative Agent hereunder, (a) such successor
shall succeed to and become vested with all of the rights, powers, privileges
and duties of the retiring Issuing Lender and Swingline Lender, (b) the retiring
Issuing Lender and Swingline Lender shall be discharged from all of their
respective duties and obligations hereunder or under the other Loan Documents,
and (c) the successor Issuing Lender shall issue letters of credit in
substitution for the Letters of Credit, if any, outstanding at the time of such
succession or make other arrangement satisfactory to the retiring Issuing Lender
to effectively assume the obligations of the retiring Issuing Lender with
respect to such Letters of Credit.

SECTION 11.7 Non-Reliance on Administrative Agent and Other Lenders. Each Lender
and each Issuing Lender acknowledges that it has, independently and without
reliance upon the Administrative Agent or any other Lender or any of their
Related Parties and based on such documents and information as it has deemed
appropriate, made its own credit analysis and decision to enter into this
Agreement. Each Lender and each Issuing Lender also acknowledges that it will,
independently and without reliance upon the Administrative Agent or any other
Lender or any of their Related Parties and based on such documents and
information as it shall from time to time deem appropriate, continue to make its
own decisions in taking or not taking action under or based upon this Agreement,
any other Loan Document or any related agreement or any document furnished
hereunder or thereunder.

SECTION 11.8 No Other Duties, etc. Anything herein to the contrary
notwithstanding, none of the syndication agents, documentation agents,
co-agents, bookrunners, lead managers, arrangers, lead arrangers or co-arrangers
listed on the cover page or signature pages 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 Administrative Agent, a Lender or
an Issuing Lender hereunder.

 

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SECTION 11.9 Collateral and Guaranty Matters.

(a) Each of the Lenders (including in its or any of its Affiliate’s capacities
as a potential Hedge Bank or Cash Management Bank) irrevocably authorize the
Administrative Agent, at its option and in its discretion:

(i) to release any Lien on any Collateral granted to or held by the
Administrative Agent, for the ratable benefit of the Secured Parties, under any
Loan Document (A) upon the termination of the Aggregate Commitment and payment
in full of all Facility Obligations (other than (1) contingent indemnification
obligations and (2) obligations and liabilities under Facility Cash Management
Agreements or Facility Hedge Agreements) and the expiration or termination of
all Letters of Credit (other than Letters of Credit as to which other
arrangements satisfactory to the Administrative Agent and the applicable Issuing
Lender shall have been made), (B) that is sold or otherwise disposed of or in
connection with any sale or other disposition permitted hereunder or under any
other Loan Document, (C) if approved, authorized or ratified in writing in
accordance with Section 12.2 and (D) on each Release Date and on the Springing
Lien Termination Date;

(ii) to subordinate any Lien on any Collateral granted to or held by the
Administrative Agent under any Loan Document to the holder of any Permitted Lien
which by operation of law or contract would have priority over the Liens
securing the Obligations; and

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

Upon request by the Administrative Agent at any time, the Required Lenders will
confirm in writing the Administrative Agent’s authority to release or
subordinate its interest in particular types or items of property, or to release
any Subsidiary Guarantor from its obligations under the Subsidiary Guaranty
Agreement pursuant to this Section 11.9. In each case as specified in this
Section 11.9, the Administrative Agent will, at the Borrower’s expense, execute
and deliver to the applicable Credit Party such documents as such Credit Party
may reasonably request to evidence the release of such item of Collateral from
the assignment and security interest granted under the Security Documents or to
subordinate its interest in such item, or to release such Guarantor from its
obligations under the Subsidiary Guaranty Agreement, in each case in accordance
with the terms of the Loan Documents and this Section 11.9. In the case of any
such sale, transfer or disposal of any property constituting Collateral in a
transaction permitted pursuant to Section 9.5, the Liens created by any of the
Loan Documents on such property shall be automatically released without need for
further action by any person.

 

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(b) The Administrative 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 Administrative Agent’s Lien thereon, or any certificate
prepared by any Credit Party in connection therewith, nor shall the
Administrative Agent be responsible or liable to the Lenders for any failure to
monitor or maintain any portion of the Collateral.

SECTION 11.10 Facility Hedge Agreements and Facility Cash Management Agreements.
No Cash Management Bank or Hedge Bank that obtains the benefits of Section 10.4
or any Collateral by virtue of the provisions hereof or of any Security Document
shall have any right to notice of any action or to consent to, direct or object
to any action hereunder or under any other Loan Document or otherwise in respect
of the Collateral (including the release or impairment of any Collateral) other
than in its capacity as a Lender and, in such case, only to the extent expressly
provided in the Loan Documents.

ARTICLE XII

MISCELLANEOUS

SECTION 12.1 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:

If to the Borrower:

Great Lakes Dredge & Dock Corporation

2122 York Road

Oak Brook, Illinois 60523

Attention:         Bruce J. Biemeck, President and

                          Chief Financial Officer

Telephone No.: 630-574-2948

Facsimile No.: 630-574-3007

E-mail: bjbiemeck@gldd.com

With copies to:

Jenner & Block LLP

353 N. Clark Street

Chicago, IL 60654-3456

Attention of: Brian S. Hart

Telephone No.: 312-923-2618

Facsimile No.: 312-923-2718

E-mail: bhart@jenner.com

 

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If to Wells Fargo, as Administrative Agent:

Wells Fargo Bank, National Association

MAC D1109-019

1525 West W.T. Harris Blvd.

Charlotte, NC 28262

Attention of: Syndication Agency Services

Telephone No.: (704) 590-2703

Facsimile No.: (704) 590-3481

With copies to:

Wells Fargo Bank, National Association

1000 Louisiana Street, 4th Floor

Houston, TX 77002-5027

Attention of: Sushim Shah, Vice President

Telephone No.: (713) 319-1374

Facsimile No.: (713) 739-1080

E-mail: Sushim.Shah@wellsfargo.com

and

Sidley Austin LLP

One South Dearborn

Chicago, IL 60603

Attention of: Michael L. Gold

Telephone No.: 312-853-7827

Facsimile No.: 312-853-7036

E-mail: mgold@sidley.com

If to any Lender:

To the address set forth on the Register

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 Issuing Lenders hereunder may be delivered or furnished by electronic
communication (including e-mail and Internet or intranet websites) pursuant to
procedures approved by the Administrative Agent, provided that the foregoing
shall not apply to notices to any Lender or any Issuing Lender pursuant to
Article II if such Lender or such Issuing Lender, as applicable, has notified
the Administrative Agent that is incapable of receiving notices under such
Article by electronic communication. The Administrative Agent or the Borrower
may, in its discretion,

 

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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 Administrative 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, email or
other communication shall be deemed to have been sent at the opening of business
on the next business day for the recipient.

(c) Administrative Agent’s Office. The Administrative Agent hereby designates
its office located at the address set forth above, or any subsequent office
which shall have been specified for such purpose by written notice to the
Borrower and Lenders, as the Administrative Agent’s Office referred to herein,
to which payments due are to be made and at which Loans will be disbursed and
Letters of Credit requested.

(d) 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.

(e) Platform.

(i) Each Credit Party agrees that the Administrative Agent may, but shall not be
obligated to, make the Communications (as defined below) available to the
Issuing Lenders 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 Administrative Agent or any of its Related Parties
(collectively, the “Agent Parties”) have any liability to the 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 Administrative 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 Administrative
Agent, any Issuing Lender or any Lender by means of electronic communications
pursuant to this Section, including through the Platform.

 

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(f) Private Side Designation. Each Public Lender agrees to cause at least one
individual at or on behalf of such Public Lender to at all times have selected
the “Private Side Information” or similar designation on the content declaration
screen of the Platform in order to enable such Public Lender or its delegate, in
accordance with such Public Lender’s compliance procedures and Applicable Law,
including United States Federal and state securities Applicable Laws, to make
reference to Borrower Materials that are not made available through the “Public
Side Information” portion of the Platform and that may contain material
non-public information with respect to the Borrower or its securities for
purposes of United States Federal or state securities Applicable Laws.

SECTION 12.2 Amendments, Waivers and Consents. Except as set forth below, any
term, covenant, agreement or condition of this Agreement or any of the other
Loan Documents may be amended or waived by the Lenders, and any consent given by
the Lenders, if, but only if, such amendment, waiver or consent is in writing
signed by the Required Lenders (or by the Administrative Agent with the consent
of the Required Lenders) and delivered to the Administrative Agent and, in the
case of an amendment, signed by the Borrower; provided, that no amendment,
waiver or consent shall:

(a) increase or extend the Commitment of any Lender (or re-instate any
Commitment terminated pursuant to Section 10.2) or the amount of Loans of any
Lender, in any case, without the written consent of such Lender;

(b) waive, extend or postpone any date fixed by this Agreement or any other Loan
Document for any scheduled payment of principal, interest, fees or other amounts
due to the Lenders (or any of them) hereunder or under any other Loan Document
without the written consent of each Lender directly and adversely affected
thereby;

(c) reduce the principal of, or the rate of interest specified herein on, any
Loan or Reimbursement Obligation, or (subject to clause (iv) of the second
proviso to this Section) any fees or other amounts payable hereunder or under
any other Loan Document without the written consent of each Lender directly and
adversely affected thereby; provided that only the consent of the Required
Lenders shall be necessary (i) to waive any obligation of the Borrower to pay
interest at the rate set forth in Section 5.1(c) or (ii) to amend any financial
covenant hereunder (or any defined term used therein) even if the effect of such
amendment would be to reduce the rate of interest on any Loan or L/C Obligation
or to reduce any fee payable hereunder;

(d) change Section 5.6 or Section 10.4 in a manner that would alter the pro rata
sharing of payments required thereby without the written consent of each Lender
directly and adversely affected thereby;

(e) change Sections 2.4(b)(i) and 10.4 in a manner that would alter the order of
application of amounts prepaid pursuant thereto without the written consent of
each Lender directly and adversely affected thereby;

 

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(f) change any provision of this Section or reduce the percentages specified in
the definitions of “Required Lenders,” or “Supermajority Lenders,” or any other
provision hereof specifying the number or percentage of Lenders required to
amend, waive or otherwise modify any rights hereunder or make any determination
or grant any consent hereunder, without the written consent of each Lender
directly affected thereby;

(g) consent to the assignment or transfer by any Credit Party of such Credit
Party’s rights and obligations under any Loan Document to which it is a party
(except as otherwise permitted by this Agreement), in each case, without the
written consent of each Lender;

(h) release (i) all of the Subsidiary Guarantors or (ii) Subsidiary Guarantors
comprising substantially all of the credit support for the Obligations, in any
case, from the Subsidiary Guaranty Agreement (other than as authorized in
Section 11.9), without the written consent of each Lender; or

(i) at any time during a Perfection Period, release all or substantially all of
the Collateral or release any Security Document (other than as permitted in
Section 4.3, authorized in Section 11.9 or as otherwise specifically permitted
or contemplated in this Agreement or the applicable Security Document) without
the written consent of each Lender;

provided further, that (i) no amendment, waiver or consent shall, unless in
writing and signed by the applicable Issuing Lender in addition to the Lenders
required above, affect the rights or duties of such Issuing Lender under this
Agreement or any Letter of Credit Application relating to any Letter of Credit
issued or to be issued by it; (ii) no amendment, waiver or consent shall, unless
in writing and signed by the Swingline Lender in addition to the Lenders
required above, affect the rights or duties of the Swingline Lender under this
Agreement; (iii) no amendment, waiver or consent shall, unless in writing and
signed by the Administrative Agent in addition to the Lenders required above,
affect the rights or duties of the Administrative Agent under this Agreement or
any other Loan Document; (iv) the Fee Letter may be amended, or rights or
privileges thereunder waived, in a writing executed only by the parties thereto,
(v) no amendment, waiver or consent shall, unless in writing and signed by the
Supermajority Lenders, (x) affect the rights of the Supermajority Lenders to
retract a Perfection Trigger Event to the extent set forth in the definition of
“Perfection Trigger Event”, or (y) amend any provision of the definition of
“Perfection Trigger Event” the waiver of which would require the consent of the
Supermajority Lenders under clause (x) above, and (vi) the Administrative Agent
and the Borrower shall be permitted to amend any provision of the Loan Documents
(and such amendment shall become effective without any further action or consent
of any other party to any Loan Document) if the Administrative Agent and the
Borrower shall have jointly identified an obvious error or any error or omission
of a technical or immaterial nature in any such provision. 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
(a) the Commitment of such Lender may not be increased or extended or (b) no
amendment, waiver of consent of the type set forth in Sections 12.2 (b) and
(c) which would otherwise require the consent of each Lender shall be permitted,
in each case, without the consent of such Defaulting Lender.

 

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Notwithstanding anything in this Agreement to the contrary, each Lender hereby
irrevocably authorizes the Administrative Agent on its behalf, and without
further consent, to enter into amendments or modifications to this Agreement
(including, without limitation, amendments to this Section 12.2) or any of the
other Loan Documents or to enter into additional Loan Documents as the
Administrative Agent reasonably deems appropriate in order to effectuate the
terms of Section 5.13 (including, without limitation, as applicable, (1) to
permit the Incremental Commitment Increases to share ratably in the benefits of
this Agreement and the other Loan Documents and (2) to include the Incremental
Commitment Increases or outstanding Incremental Loans in any determination of
(i) Required Lenders or Required Lenders, as applicable or (ii) similar required
lender terms applicable thereto); provided that no amendment or modification
shall result in any increase in the amount of any Lender’s Commitment or any
increase in any Lender’s Commitment Percentage, in each case, without the
written consent of such affected Lender.

SECTION 12.3 Expenses; Indemnity.

(a) Costs and Expenses. The Borrower and any other Credit Party, jointly and
severally, shall pay (i) all reasonable and documented out of pocket expenses
incurred by the Administrative Agent and its Affiliates (including the
reasonable fees, charges and disbursements of counsel for the Administrative
Agent), in connection with the syndication of the Revolving Credit Facility, 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), (ii) all reasonable and
documented out of pocket expenses incurred by the Issuing Lenders in connection
with the issuance, amendment, renewal or extension of any Letter of Credit or
any demand for payment thereunder and (iii) all documented out of pocket
expenses incurred by the Administrative Agent, any Lender or any Issuing Lender
(including the fees, charges and disbursements of any counsel for the
Administrative Agent, any Lender or any Issuing Lender), in connection with the
enforcement or protection of its rights (A) in connection with this Agreement
and the other Loan Documents, including its rights under this Section, or (B) in
connection with the Loans made or Letters of Credit issued hereunder, including
all such out of pocket expenses incurred during any workout or restructuring in
respect of such Loans or Letters of Credit.

(b) Indemnification by the Borrower. The Borrower shall indemnify the
Administrative Agent (and any sub-agent thereof), each Lender and each Issuing
Lender, and each Related Party of any of the foregoing Persons (each such Person
being called an “Indemnitee”) against, and hold each Indemnitee harmless from,
and shall pay or reimburse any such Indemnitee for, any and all losses, claims
(including, without limitation, any Environmental Claims), damages, liabilities
and related reasonable out-of-pocket expenses (including the fees, charges and
disbursements of any counsel for any Indemnitee), and shall indemnify and hold
harmless, each Indemnitee from, and shall pay or reimburse any such Indemnitee
for, all reasonable out-of-pocket fees and disbursements for attorneys, incurred
by any Indemnitee or asserted against any Indemnitee by any Person (including
the Borrower or any other Credit Party), other than such Indemnitee and its
Related Parties, 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

 

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of their respective obligations hereunder or thereunder or the consummation of
the transactions contemplated hereby or thereby (including, without limitation,
the Transactions), (ii) any Loan or Letter of Credit or the use or proposed use
of the proceeds therefrom (including any refusal by an Issuing Lender 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 or vessel owned or operated by any Credit
Party or any Subsidiary thereof, or any Environmental Claim, (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 thereof, and
regardless of whether any Indemnitee is a party thereto, or (v) any claim
(including, without limitation, any Environmental Claims), investigation,
litigation or other proceeding (whether or not the Administrative Agent or any
Lender is a party thereto) and the prosecution and defense thereof, arising out
of or in any way connected with the Loans, this Agreement, any other Loan
Document, or any documents contemplated by or referred to herein or therein or
the transactions contemplated hereby or thereby, 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, bad faith or willful misconduct of such Indemnitee
(or such Indemnitee’s officer’s employees, directors, controlled representative
or controlled affiliates involved in the arrangement of this Agreement) or
(y) result from a claim brought by any Credit Party or any Subsidiary thereof
against an Indemnitee for breach in bad faith of such Indemnitee’s obligations
hereunder or under any other Loan Document, if such Credit Party or such
Subsidiary has obtained a final and nonappealable judgment in its favor on such
claim as determined by a court of competent jurisdiction.

(c) Reimbursement by Lenders. To the extent that the Borrower for any reason
fails to indefeasibly pay any amount required under clause (a) or (b) of this
Section to be paid by it to the Administrative Agent (or any sub-agent thereof),
an Issuing Lender, the Swingline Lender or any Related Party of any of the
foregoing, then (without limiting the Borrower’s obligation to do so) each
Lender severally agrees to pay to the Administrative Agent (or any such
sub-agent), such Issuing Lender, the Swingline 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 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 the Issuing
Lenders or the Swingline Lender solely in its capacity as such, only the Lenders
shall be required to pay such unpaid amounts, such payment to be made severally
among them based on such Lenders’ Commitment 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 Administrative Agent (or any such sub-agent), the Issuing
Lenders or the Swingline Lender in its capacity as such, or against any Related
Party of any of the foregoing acting for the Administrative Agent (or any such
sub-agent), Issuing Lender or the Swingline Lender in connection with such
capacity. The obligations of the Lenders under this clause (c) are subject to
the provisions of Section 5.7.

 

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(d) Waiver of Consequential Damages, Etc. To the fullest extent permitted by
Applicable Law, the Borrower and each other Credit Party shall not assert, and
hereby waives, any claim against any Indemnitee, on any theory of liability, for
special, indirect, consequential or punitive damages (as opposed to direct or
actual damages) arising out of, in connection with, or as a result of, 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
clause (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 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 12.4 Right of Setoff. If an Event of Default shall have occurred and be
continuing, each Lender, each Issuing Lender and the Swingline Lender and each
of their respective Affiliates is hereby authorized at any time and from time to
time, to the fullest extent permitted by Applicable Law, to set off and apply
any and all deposits (general or special, time or demand, provisional or final,
in whatever currency) at any time held and other obligations (in whatever
currency), other than deposits in fiduciary accounts as to which a Credit Party
is acting as a fiduciary for another Person who is not a Credit Party at any
time, owing by such Lender, such Issuing Lender, the Swingline Lender or any
such Affiliate to or for the credit or the account of the Borrower or any other
Credit Party against any and all of the Obligations of the Borrower or such
Credit Party now or hereafter existing under this Agreement or any other Loan
Document to such Lender, such Issuing Lender or the Swingline Lender or any of
their respective Affiliates, irrespective of whether or not such Lender, such
Issuing Lender, the Swingline Lender or any such Affiliate shall have made any
demand under this Agreement or any other Loan Document and although such
Obligations of the Borrower or such Credit Party may be contingent or unmatured
or are owed to a branch or office of such Lender, such Issuing Lender, the
Swingline Lender or such Affiliate 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 Administrative
Agent for further application in accordance with the provisions of Section 10.4
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 Administrative
Agent, the Issuing Lenders, the Swingline Lender and the Lenders, and (y) the
Defaulting Lender shall provide promptly to the Administrative 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, each
Issuing Lender, the Swingline Lender and their respective Affiliates under this
Section are in addition to other rights and remedies (including other rights of
setoff) that such Lender, such Issuing Lender, the Swingline Lender or their
respective Affiliates may have. Each Lender, each Issuing Lender and the
Swingline Lender agrees to notify the Borrower and the Administrative 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.

 

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SECTION 12.5 Governing Law; Jurisdiction, Etc.

(a) Governing Law. This Agreement and the other Loan Documents and any claim,
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, the law of the State of New York.

(b) Submission to Jurisdiction. Each of the parties hereto irrevocably and
unconditionally submits to the non-exclusive jurisdiction of the courts of the
State of New York sitting in New York County, and of the United States District
Court of the Southern District of New York, and any appellate court from any
thereof, and agrees that all claims in respect of any such action, litigation or
proceeding may be heard and determined in such New York State court or, to the
fullest extent permitted by Applicable Law, in such federal court. Each of the
parties hereto agrees that a final judgment in any such action, 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
Administrative Agent, any Lender, any Issuing Lender or the Swingline Lender may
otherwise have to bring any action or proceeding relating to this Agreement or
any other Loan Document against the Borrower or any other Credit Party or its
properties in the courts of any jurisdiction.

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

(d) Service of Process. Each party hereto irrevocably consents to service of
process in the manner provided for notices in Section 12.1. Nothing in this
Agreement will affect the right of any party hereto to serve process in any
other manner permitted by Applicable Law.

SECTION 12.6 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). IF AND TO THE EXTENT THAT THE FOREGOING WAIVER OF THE RIGHT TO A JURY
TRIAL IS UNENFORCEABLE FOR ANY REASON IN SUCH FORUM, EACH OF THE PARTIES HERETO
HEREBY CONSENTS TO THE

 

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ADJUDICATION OF ALL CLAIMS PURSUANT TO JUDICIAL REFERENCE AS PROVIDED IN
CALIFORNIA CODE OF CIVIL PROCEDURE SECTION 638, AND THE JUDICIAL REFEREE SHALL
BE EMPOWERED TO HEAR AND DETERMINE ALL ISSUES IN SUCH REFERENCE, WHETHER FACT OR
LAW. 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 CONSENT 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 12.7 Reversal of Payments. To the extent any Credit Party makes a
payment or payments to the Administrative Agent for the ratable benefit of the
Lenders or the Administrative Agent receives any payment or proceeds of the
Collateral which payments or proceeds or any part thereof are subsequently
invalidated, declared to be fraudulent or preferential, set aside and/or
required to be repaid to a trustee, receiver or any other party under any
bankruptcy law, state or federal law, common law or equitable cause, then, to
the extent of such payment or proceeds repaid, the Obligations or part thereof
intended to be satisfied shall be revived and continued in full force and effect
as if such payment or proceeds had not been received by the Administrative
Agent.

SECTION 12.8 Injunctive Relief. The Borrower recognizes that, in the event the
Borrower fails to perform, observe or discharge any of its obligations or
liabilities under this Agreement, any remedy of law may prove to be inadequate
relief to the Lenders. Therefore, the Borrower agrees that the Lenders, at the
Lenders’ option, shall be entitled to temporary and permanent injunctive relief
in any such case without the necessity of proving actual damages.

SECTION 12.9 Accounting Matters. If at any time any change in GAAP would affect
the computation of any financial ratio or requirement set forth in any Loan
Document, and either the Borrower or the Required Lenders shall so request, the
Administrative Agent, the Lenders and the Borrower shall negotiate in good faith
to amend such ratio or requirement to preserve the original intent thereof in
light of such change in GAAP (subject to the approval of the Required Lenders);
provided that, until so amended, (i) such ratio or requirement shall continue to
be computed in accordance with GAAP prior to such change therein and (ii) the
Borrower shall provide to the Administrative Agent and the Lenders financial
statements and other documents required under this Agreement or as reasonably
requested hereunder setting forth a reconciliation between calculations of such
ratio or requirement made before and after giving effect to such change in GAAP.

SECTION 12.10 Successors and Assigns; 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 neither the Borrower nor
any other Credit Party may assign or otherwise transfer any of its rights or
obligations hereunder without the prior written consent of the Administrative
Agent and each Lender (except in connection with a transaction permitted

 

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under this Agreement) 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 clause (b) of this Section, (ii) by way of participation in
accordance with the provisions of clause (d) of this Section or (iii) by way of
pledge or assignment of a security interest subject to the restrictions of
clause (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 clause (d) of this Section and, to the extent
expressly contemplated hereby, the Related Parties of each of the Administrative
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 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 clause (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 clause (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 Administrative Agent or, if
“Trade Date” is specified in the Assignment and Assumption, as of the Trade
Date) shall not be less than $5,000,000, unless each of the Administrative Agent
and, so long as no Event of Default has occurred and is continuing, the Borrower
otherwise consents (each such consent not to be unreasonably withheld or
delayed); provided that the Borrower shall be deemed to have given its consent
six (6) Business Days after the date written notice thereof has been delivered
by the assigning Lender (through the Administrative Agent) unless such consent
is expressly refused by the Borrower prior to such sixth (6th) Business Day;

(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;

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

 

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(A) the consent of the Borrower (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 the Borrower shall
be deemed to have consented to any such assignment unless it shall object
thereto by written notice to the Administrative Agent within six (6) Business
Days after having received notice thereof;

(B) the consent of the Administrative Agent (such consent not to be unreasonably
withheld or delayed) shall be required if such assignment is to a Person that is
not a Lender with a Commitment, an Affiliate of such Lender or an Approved Fund
with respect to such Lender; and

(C) the consents of the Issuing Lenders and the Swingline Lender shall be
required for any assignment in respect of the Revolving Credit Facility.

(iv) Assignment and Assumption. The parties to each assignment shall execute and
deliver to the Administrative Agent an Assignment and Assumption, together with
a processing and recordation fee of $3,500 for each assignment; provided that
(A) only one such fee will be payable in connection with simultaneous
assignments to two or more Approved Funds by a Lender and (B) the Administrative
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 Administrative Agent an Administrative
Questionnaire.

(v) No Assignment to Certain Persons. No such assignment shall be made to
(A) the Borrower or any of the Borrower’s Subsidiaries or Affiliates, (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 Person set forth on Schedule 12.10.

(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 Administrative Agent in an 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 the Borrower and the Administrative 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 (A) pay and satisfy in full all payment liabilities
then owed by such Defaulting Lender to the Administrative Agent, the Issuing
Lenders, the Swingline Lender and each other Lender hereunder (and interest
accrued thereon), and (B) acquire (and fund as appropriate) its full pro rata
share

 

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of all Loans and participations in Letters of Credit and Swingline Loans in
accordance with its Commitment 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 Administrative Agent pursuant
to clause (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 5.8, 5.9, 5.10, 5.11 and 12.3 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 Administrative Agent, acting solely for this purpose as a
non-fiduciary agent of the Borrower, shall maintain at one of its offices in
Charlotte, North Carolina, a copy of each Assignment and Assumption and each
Lender Joinder Agreement delivered to it and a register for the recordation of
the names and addresses of the Lenders, and the Commitment of, and principal
amounts of (and stated interest on) 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 Borrower, the Administrative
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 the Borrower
and any Lender (but only to the extent of entries in the Register that are
applicable to such Lender), at any reasonable time and from time to time upon
reasonable prior notice.

(d) Participations. Any Lender may at any time, without the consent of, or
notice to, the Borrower or the Administrative Agent, sell participations to any
Person (other than a natural Person or the Borrower or any of the Borrower’s
Affiliates or Subsidiaries) (each, a “Participant”) in all or a portion of such
Lender’s rights and/or obligations under this Agreement (including all or a
portion of its Commitment and/or the Loans owing to it); provided that (i) such
Lender’s obligations under this Agreement shall remain unchanged, (ii) such
Lender shall remain solely responsible to the other parties hereto for the
performance of such obligations and (iii) the Borrower, the Administrative
Agent, the Issuing Lenders, the Swingline Lender and the other Lenders shall
continue to deal solely and directly with such Lender in connection with such
Lender’s rights and obligations under this Agreement. For the avoidance of
doubt, each Lender shall be responsible for the indemnity under Section 12.3(c)
with respect to any payments made by such Lender to its Participant(s).

 

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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 or modification described in
Section 12.2 that directly affects such Participant and could not be affected by
a vote of the Required Lenders. The Borrower agrees that each Participant shall
be entitled to the benefits of Sections 5.8, 5.9, 5.10 and 5.11 (subject to the
requirements and limitations therein, including the requirements of
Section 5.11(f) (it being understood that the documentation required under
Section 5.11(f) shall be delivered to the participating Lender)) to the same
extent as if it were a Lender and had acquired its interest by assignment
pursuant to paragraph (b) of this Section; provided that such Participant
(A) agrees to be subject to the provisions of Section 5.12 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 5.10 and 5.11, with respect to such
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 the
Borrower’s request and expense, to use reasonable efforts to cooperate with the
Borrower to effectuate the provisions of Section 5.12(b) with respect to any
Participant. To the extent permitted by law, each Participant also shall be
entitled to the benefits of Section 12.4 as though it were a Lender; provided
that such Participant agrees to be subject to Section 5.6 as though it were a
Lender.

(e) Participant Register. Each Lender that sells a participation shall, acting
solely for this purpose as a non-fiduciary agent of the Borrower, 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 Administrative Agent (in its capacity as Administrative Agent)
shall have no responsibility for maintaining a Participant Register.

(f) Certain Pledges. Any Lender may at any time pledge or assign a security
interest in all or any portion of its rights under this Agreement to secure
obligations of such Lender, including without limitation 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.

 

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SECTION 12.11 Treatment of Certain Information; Confidentiality. Each of the
Administrative Agent, the Lenders and the Issuing Lenders agrees to maintain the
confidentiality of the Information (as defined below), except that Information
may be disclosed (a) to its Affiliates and to its and its 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 in accordance with customary practices), (b) to
the extent required or requested by, or required to be disclosed to, any
regulatory or similar 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 under this Agreement, under any other Loan Document or under any
Facility Hedge Agreement or Facility Cash Management Agreement, or any action or
proceeding relating to this Agreement, any other Loan Document or any Facility
Hedge Agreement or Facility Cash Management Agreement, 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 Eligible
Assignee of or Participant in, or any prospective Eligible Assignee of or
Participant in, any of its rights and obligations under this Agreement, and
(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 the Borrower and its obligations, this Agreement or payments hereunder,
(g) on a confidential basis to (i) any rating agency in connection with rating
the Borrower or its Subsidiaries or the Revolving Credit Facility or (ii) the
CUSIP Service Bureau or any similar agency in connection with the issuance and
monitoring of CUSIP numbers with respect to the Credit Facility (it being
understood that, prior to any such disclosure, such Person to whom such
disclosure is to be made will be informed of the confidential nature of such
Information and shall undertake to keep such Information confidential in
accordance with customary practices); (h) with the written consent of the
Borrower, or (i) to the extent such Information (i) becomes publicly available
other than as a result of a breach of this Section or (ii) becomes available to
the Administrative Agent, any Lender, any Issuing Lender or any of their
respective Affiliates on a non-confidential basis from a source other than the
Borrower or any Affiliate of the Borrower or (k) to governmental regulatory
authorities in connection with any regulatory examination of the Administrative
Agent or any Lender or in accordance with the Administrative Agent’s or any
Lender’s regulatory compliance policy if the Administrative Agent or such Lender
deems necessary for the mitigation of claims by those authorities against the
Administrative Agent or such Lender or any of its subsidiaries or affiliates. In
addition, each of the Administrative Agent, the Lenders and the Issuing Lenders
may disclose the existence of this Agreement and information about this
Agreement to market data collectors, similar service providers to the lending
industry and service providers to the Administrative Agent, the Lenders or the
Issuing Lenders in connection with the administration and management of this
Agreement, the other Loan Documents, the Commitments and the Extensions of
Credit. For purposes of this Section, “Information” means all information
received from any Credit Party or any Subsidiary thereof relating to any Credit
Party or any Subsidiary thereof or any of their respective businesses, other
than any such information that is publicly available to the Administrative
Agent, any Lender or any Issuing Lender prior to disclosure by any Credit Party
or any Subsidiary thereof other than as a result of

 

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a breach of this Section; provided that, in the case of information received
from a Credit Party or any Subsidiary thereof after the date hereof, such
information is clearly identified at the time of delivery as confidential or is
delivered pursuant to Section 8.1, 8.2 or 8.3 hereof and is not publically
available. Any Person required to maintain the confidentiality of Information as
provided in this Section shall be considered to have complied with its
obligation to do so if such Person has exercised the same degree of care to
maintain the confidentiality of such Information as such Person would accord to
its own confidential information.

Each of the Administrative Agent, the Lenders and each Issuing Lender
acknowledges that (i) the Information may include material non-public
information concerning the Borrower or any of its Subsidiaries, (ii) it has
developed compliance procedures regarding the use of material non-public
information and (iii) it is required to handle such material non-public
information in accordance with applicable Law, including United States federal
and state securities Laws.

SECTION 12.12 Performance of Duties. Each of the Credit Party’s obligations
under this Agreement and each of the other Loan Documents shall be performed by
such Credit Party at its sole cost and expense.

SECTION 12.13 All Powers Coupled with Interest. All powers of attorney and other
authorizations granted to the Lenders, the Administrative Agent and any Persons
designated by the Administrative Agent or any Lender pursuant to any provisions
of this Agreement or any of the other Loan Documents shall be deemed coupled
with an interest and shall be irrevocable so long as any of the Obligations
remain unpaid or unsatisfied, any of the Commitments remain in effect or the
Revolving Credit Facility has not been terminated.

SECTION 12.14 Survival.

(a) All representations and warranties set forth in Article VII and all
representations and warranties contained in any certificate, or any of the Loan
Documents (including, but not limited to, any such representation or warranty
made in or in connection with any amendment thereto) shall constitute
representations and warranties made under this Agreement. All representations
and warranties made under this Agreement shall be made or deemed to be made at
and as of the Closing Date (except those that are expressly made as of a
specific date), shall survive the Closing Date and shall not be waived by the
execution and delivery of this Agreement, any investigation made by or on behalf
of the Lenders or any borrowing hereunder.

(b) Notwithstanding any termination of this Agreement, the indemnities to which
the Administrative Agent and the Lenders are entitled under the provisions of
this Article XII, Section 5.9, Section 5.10, Section 5.11 and Section 11.3 shall
continue in full force and effect and shall protect the Administrative Agent and
the Lenders against events arising after such termination as well as before.

SECTION 12.15 Titles and Captions. Titles and captions of Articles, Sections and
subsections in, and the table of contents of, this Agreement are for convenience
only, and neither limit nor amplify the provisions of this Agreement.

 

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SECTION 12.16 Severability of Provisions. Any provision of this Agreement or any
other Loan Document which is prohibited or unenforceable in any jurisdiction
shall, as to such jurisdiction, be ineffective only to the extent of such
prohibition or unenforceability without invalidating the remainder of such
provision or the remaining provisions hereof or thereof or affecting the
validity or enforceability of such provision in any other jurisdiction.

SECTION 12.17 Counterparts; Integration; Effectiveness; Electronic Execution.

(a) Counterparts; Integration; Effectiveness. This Agreement may be executed in
counterparts (and by different parties hereto in different counterparts), each
of which shall constitute an original, but all of which when taken together
shall constitute a single contract. This Agreement and the other Loan Documents,
and any separate letter agreements with respect to fees payable to the
Administrative Agent, constitute the entire contract among the parties relating
to the subject matter hereof and supersede any and all previous agreements and
understandings, oral or written, relating to the subject matter hereof. Except
as provided in Section 6.1, this Agreement shall become effective when it shall
have been executed by the Administrative Agent and when the Administrative Agent
shall have received counterparts hereof that, when taken together, bear the
signatures of each of the other parties hereto. 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

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

SECTION 12.18 Term of Agreement. This Agreement shall remain in effect from the
Closing Date through and including the Termination Date. No termination of this
Agreement shall affect the rights and obligations of the parties hereto arising
prior to such termination or in respect of any provision of this Agreement which
survives such termination.

SECTION 12.19 USA PATRIOT Act. The Administrative Agent and each Lender hereby
notifies the Borrower that pursuant to the requirements of the PATRIOT Act, it
is required to obtain, verify and record information that identifies the
Borrower and the Subsidiary Guarantors, which information includes the name and
address of the Borrower and each Subsidiary Guarantor and other information that
will allow such Lender to identify the Borrower or such Subsidiary Guarantor in
accordance with the PATRIOT Act.

SECTION 12.20 Inconsistencies with Other Documents. In the event there is a
conflict or inconsistency between this Agreement and any other Loan Document,
the terms of this Agreement shall control; provided that any provision of the
Security Documents which imposes additional burdens on the Borrower or any of
its Subsidiaries or further restricts the rights of the Borrower or any of its
Subsidiaries or gives the Administrative Agent or Lenders additional rights
shall not be deemed to be in conflict or inconsistent with this Agreement and
shall be given full force and effect.

 

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SECTION 12.21 No Advisory or Fiduciary Responsibility. In connection with all
aspects of each transaction contemplated hereby (including in connection with
any amendment, waiver or other modification hereof or of any other Loan
Document), the Borrower acknowledges and agrees that: (a)(i) the arranging and
other services regarding this Agreement provided by the Lenders are arm’s-length
commercial transactions between the Borrower and its Affiliates, on the one
hand, and the Lenders, on the other hand, (ii) the Borrower has consulted its
own legal, accounting, regulatory and tax advisors to the extent it has deemed
appropriate, and (iii) the Borrower is capable of evaluating, and understands
and accepts, the terms, risks and conditions of the transactions contemplated
hereby and by the other Loan Documents; (b) (i) each of the Lenders is and has
been acting solely as a principal and, except as expressly agreed in writing by
the relevant parties, has not been, is not, and will not be acting as an
advisor, agent or fiduciary for the Borrower or any of its Affiliates, or any
other Person and (ii) no Lender has any obligation to the Borrower or any of its
Affiliates with respect to the transactions contemplated hereby except those
obligations expressly set forth herein and in the other Loan Documents; and
(c) each of the Lenders and their respective Affiliates may be engaged in a
broad range of transactions that involve interests that differ from those of the
Borrower and its Affiliates, and no Lender has any obligation to disclose any of
such interests to the Borrower or its Affiliates. To the fullest extent
permitted by law, the Borrower hereby waives and releases any claims that it may
have against each of the Lenders with respect to any breach or alleged breach of
agency or fiduciary duty in connection with any aspect of any transaction
contemplated hereby.

[Signature pages to follow]

 

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

 

GREAT LAKES DREDGE & DOCK CORPORATION, as Borrower

By:

 

/s/ Bruce J. Biemeck

Name:

  Bruce J. Biemeck

Title:

  President and Chief Financial Officer GREAT LAKES DREDGE & DOCK ENVIRONMENTAL,
INC., as a Credit Party

By:

 

/s/ Bruce J. Biemeck

Name:

  Bruce J. Biemeck

Title:

  Senior Vice President and Chief Financial Officer GREAT LAKES DREDGE & DOCK
COMPANY, LLC, as a Credit Party

By:

 

/s/ Bruce J. Biemeck

Name:

  Bruce J. Biemeck

Title:

  President and Chief Financial Officer DAWSON MARINE SERVICES COMPANY, as a
Credit Party

By:

 

/s/ Catherine Hoffman

Name:

  Catherine Hoffman

Title:

  President NASDI HOLDINGS CORPORATION, as a Credit Party

By:

 

/s/ Bruce J. Biemeck

Name:

  Bruce J. Biemeck

Title:

  Vice President and Chief Financial Officer

 

Signature Page to

Credit Agreement

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

NASDI, LLC, as a Credit Party

By:

 

/s/ Bruce J. Biemeck

Name:

  Bruce J. Biemeck

Title:

  Vice President

FIFTY-THREE DREDGING CORPORATION, as a Credit Party

By:

 

/s/ Paul E. Dinquel

Name:

  Paul E. Dinquel

Title:

  Vice President

YANKEE ENVIRONMENTAL SERVICES, LLC, as a Credit Party

By:

 

/s/ Bruce J. Biemeck

Name:

  Bruce J. Biemeck

Title:

  Vice President and Chief Financial Officer

 

Signature Page to

Credit Agreement

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

WELLS FARGO BANK, NATIONAL ASSOCIATION, as Administrative Agent, Swingline
Lender, an Issuing Lender and a Lender

By:

 

/s/ Sushim R. Shah

Name:

  Sushim R. Shah

Title:

  VP & Senior Relationship Manager

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

BANK OF AMERICA, N.A., as an Issuing Lender and as a Lender

By:

 

/s/ Jonathan M. Phillips

Name:

  Jonathan M. Phillips

Title:

  Senior Vice President

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

PNC BANK, NATIONAL ASSOCIATION, as a Lender

By:

 

/s/ Jon Hinard

Name:

  Jon Hinard

Title:

  Senior Vice President

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

BMO HARRIS FINANCING, INC., as a Lender

By:

 

/s/ Michael Gift

Name:

  Michael Gift

Title:

  Vice President

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

FIFTH THIRD BANK, as a Lender

By:

 

/s/ Robert Mangers

Name:

  Robert Mangers

Title:

  Vice President

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

MB FINANCIAL BANK, N.A., as a Lender

By:

 

/s/ Timothy E. Broccolo

Name:

  Timothy E. Broccolo

Title:

  Senior Vice President

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

DEUTSCHE BANK AG, NEW YORK BRANCH, as a Lender

By:

 

/s/ Scottye Lindsey

Name:

  Scottye Lindsey

Title:

  Director

By:

 

/s/ Dusan Lazarov

Name:

  Dusan Lazarov

Title:

  Director

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

EXHIBIT A-1

FORM OF REVOLVING CREDIT NOTE

 

$                                                , 20        

FOR VALUE RECEIVED, the undersigned, GREAT LAKES DREDGE & DOCK CORPORATION, a
Delaware corporation (the “Borrower”), promises to pay
to                        (the “Lender”), at the place and times provided in the
Credit Agreement referred to below, the principal sum of
                        DOLLARS ($                    ) or, if less, the unpaid
principal amount of all Revolving Credit Loans made by the Lender from time to
time pursuant to that certain Credit Agreement, dated as of June 4, 2012 (as
amended, restated, supplemented or otherwise modified from time to time, the
“Credit Agreement”) by and among the Borrower, the other Credit Parties party
thereto from time to time, the Lenders who are or may become a party thereto, as
Lenders, and Wells Fargo Bank, National Association, as Administrative Agent,
Swingline Lender and as an Issuing Lender. Capitalized terms used herein and not
defined herein shall have the meanings assigned thereto in the Credit Agreement.

The unpaid principal amount of this Revolving Credit Note from time to time
outstanding is subject to mandatory repayment from time to time as provided in
the Credit Agreement and shall bear interest as provided in Section 5.1 of the
Credit Agreement. All payments of principal and interest on this Revolving
Credit Note shall be payable in lawful currency of the United States in
immediately available funds to the account designated in the Credit Agreement.

This Revolving Credit Note is entitled to the benefits of, and evidences
Obligations incurred under, the Credit Agreement, to which reference is made for
a description of the security for this Revolving Credit Note and for a statement
of the terms and conditions on which the Borrower is permitted and required to
make prepayments and repayments of principal of the Obligations evidenced by
this Revolving Credit Note and on which such Obligations may be declared to be
immediately due and payable.

THIS REVOLVING CREDIT NOTE SHALL BE GOVERNED BY, CONSTRUED AND ENFORCED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, INCLUDING SECTION 5-1401 AND
SECTION 5-1402 OF THE GENERAL OBLIGATIONS LAW OF THE STATE OF NEW YORK, WITHOUT
REFERENCE TO ANY OTHER CONFLICTS OR CHOICE OF LAW PRINCIPLES THEREOF.

The Indebtedness evidenced by this Revolving Credit Note is senior in right of
payment to all Subordinated Indebtedness referred to in the Credit Agreement.

The Borrower hereby waives all requirements as to diligence, presentment, demand
of payment, protest and (except as required by the Credit Agreement) notice of
any kind with respect to this Revolving Credit Note.

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

IN WITNESS WHEREOF, the undersigned has executed this Revolving Credit Note as
of the day and year first above written.

[Remainder of page left intentionally blank]

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

 

GREAT LAKES DREDGE & DOCK CORPORATION

By:

      Name:       Title:    

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

EXHIBIT A-2

FORM OF SWINGLINE NOTE

 

$                                            , 20        

FOR VALUE RECEIVED, the undersigned, GREAT LAKES DREDGE & DOCK CORPORATION, a
Delaware corporation (the “Borrower”), promises to pay to WELLS FARGO BANK,
NATIONAL ASSOCIATION (the “Lender”), at the place and times provided in the
Credit Agreement referred to below, the principal sum of
                        DOLLARS ($                    ) or, if less, the
principal amount of all Swingline Loans made by the Lender from time to time
pursuant to that certain Credit Agreement, dated as of June 4, 2012 (as amended,
restated, supplemented or otherwise modified from time to time, the “Credit
Agreement”) by and among the Borrower, the other Credit Parties party thereto
from time to time, the Lenders who are or may become a party thereto, as
Lenders, and Wells Fargo Bank, National Association, as Administrative Agent,
Swingline Lender and as an Issuing Lender. Capitalized terms used herein and not
defined herein shall have the meanings assigned thereto in the Credit Agreement.

The unpaid principal amount of this Swingline Note from time to time outstanding
is subject to mandatory repayment from time to time as provided in the Credit
Agreement and shall bear interest as provided in Section 5.1 of the Credit
Agreement. Swingline Loans refunded as Revolving Credit Loans in accordance with
Section 5.1 of the Credit Agreement shall be payable by the Borrower as
Revolving Credit Loans pursuant to the Revolving Credit Notes, and shall not be
payable under this Swingline Note as Swingline Loans. All payments of principal
and interest on this Swingline Note shall be payable in lawful currency of the
United States in immediately available funds to the account designated in the
Credit Agreement.

This Swingline Note is entitled to the benefits of, and evidences Obligations
incurred under, the Credit Agreement, to which reference is made for a
description of the security for this Swingline Note and for a statement of the
terms and conditions on which the Borrower is permitted and required to make
prepayments and repayments of principal of the Obligations evidenced by this
Swingline Note and on which such Obligations may be declared to be immediately
due and payable.

THIS SWINGLINE NOTE SHALL BE GOVERNED BY, CONSTRUED AND ENFORCED IN ACCORDANCE
WITH THE LAWS OF THE STATE OF NEW YORK, INCLUDING SECTION 5-1401 AND SECTION
5-1402 OF THE GENERAL OBLIGATIONS LAW OF THE STATE OF NEW YORK, WITHOUT
REFERENCE TO ANY OTHER CONFLICTS OR CHOICE OF LAW PRINCIPLES THEREOF.

The Indebtedness evidenced by this Swingline Note is senior in right of payment
to all Subordinated Indebtedness referred to in the Credit Agreement.

The Borrower hereby waives all requirements as to diligence, presentment, demand
of payment, protest and (except as required by the Credit Agreement) notice of
any kind with respect to this Swingline Note.

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

IN WITNESS WHEREOF, the undersigned has executed this Swingline Note as of the
day and year first above written.

[Remainder of page left intentionally blank]

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

GREAT LAKES DREDGE & DOCK CORPORATION

By:

      Name:       Title:    

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

EXHIBIT B

FORM OF NOTICE OF BORROWING

Dated as of:                     

Wells Fargo Bank, National Association,

    as Administrative Agent

MAC D 1109-019

1525 West W.T. Harris Blvd.

Charlotte, North Carolina 28262

Attention: Syndication Agency Services

Email: agencyservices.requests@wellsfargo.com

Fax: 704-715-0017

Ladies and Gentlemen:

This irrevocable Notice of Borrowing is delivered to you pursuant to
Section 2.3(a) of the Credit Agreement dated as of June 4, 2012 (as amended,
restated, supplemented or otherwise modified from time to time, the “Credit
Agreement”), by and among Great Lakes Dredge & Dock Corporation, a Delaware
corporation (the “Borrower”), the other Credit Parties party thereto from time
to time, the lenders who are or may become party thereto, as Lenders, and Wells
Fargo Bank, National Association, as Administrative Agent, Swingline Lender and
as an Issuing Lender. Capitalized terms used herein and not defined herein shall
have the meanings assigned thereto in the Credit Agreement.

1. The Borrower hereby requests that the Lenders make [a Revolving Credit Loan]
[a Swingline Loan] to the Borrower in the aggregate principal amount of
$                     1 [denominated in [Alternative Currency]].

2. The Borrower hereby requests that such Loan be made on the following Business
Day:                                 (the “Borrowing Date”).2

3. The Borrower hereby requests that such Loan bear interest at the following
interest rate, plus the Applicable Margin, as set forth below:

 

Component

of Loan

 

Interest Rate

 

Interest Period

(LIBOR

Rate only)

 

Termination Date for

Interest Period

(if applicable)

 

 

1 

Complete with an amount in accordance with Section 2.3(a) of the Credit
Agreement.

2 

Complete with a Business Day in accordance with Section 2.3(a) of the Credit
Agreement for Revolving Credit Loans or Swingline Loans.

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

[Base Rate or LIBOR

Rate]3

4. The Borrower hereby certifies that the following statements will be true and
correct on the Borrowing Date:

(a) After giving effect to the requested borrowing, (i) the Dollar Equivalent
Amount of Outstandings do not exceed the Aggregate Commitment, [(ii) the
aggregate Dollar Equivalent Amount of the Revolving Credit Exposure of any
Lender does not exceed such Lender’s Commitment and (iii) the Dollar Equivalent
Amount of all Revolving Credit Loans denominated in Alternative Currencies does
not exceed the Alternative Currency Loan Commitment]4 [and (ii) the aggregate
principal amount of all outstanding Swingline Loans does not exceed the
Swingline Commitment]5.

(b) The representations and warranties contained in Article VII of the Credit
Agreement are true and correct in all material respects, except for any
representation and warranty that is qualified by materiality or reference to
Material Adverse Effect, which such representation and warranty is true and
correct in all respects on and as of the Borrowing Date with the same effect as
if made on and as of such date (except for any such representation and warranty
that by its terms is made only as of an earlier date, which representation and
warranty shall remain true and correct in all material respects, except for any
representation and warranty that is qualified by materiality or reference to
Material Adverse Effect, which such representation and warranty is true and
correct in all respects as of such earlier date).

(c) No Default or Event of Default exists, or would result from, such proposed
borrowing or from the application of the proceeds therefrom.

[Signature Page Follows]

 

 

3 

Complete with (i) the Base Rate or the LIBOR Rate for Revolving Credit Loans,
(ii) the LIBOR Rate for Revolving Credit Loans denominated in Alternative
Currencies or (iii) the Base Rate for Swingline Loans.

4 

Include if the requested borrowing is for Revolving Credit Loans.

5 

Include if the requested borrowing is for Swingline Loans.

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

IN WITNESS WHEREOF, the undersigned has executed this Notice of Borrowing as of
the day and year first written above.

 

GREAT LAKES DREDGE & DOCK CORPORATION By:       Name:       Title:    

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

EXHIBIT C

FORM OF NOTICE OF ACCOUNT DESIGNATION

Dated as of:                     

Wells Fargo Bank, National Association,

    as Administrative Agent

MAC D 1109-019

1525 West W.T. Harris Blvd.

Charlotte, North Carolina 28262

Attention: Syndication Agency Services

Email: agencyservices.requests@wellsfargo.com

Fax: 704-715-0017

Ladies and Gentlemen:

This Notice of Account Designation is delivered to you pursuant to
Section 2.3(b) of the Credit Agreement dated as of June 4, 2012 (as amended,
restated, supplemented or otherwise modified from time to time, the “Credit
Agreement”), by and among Great Lakes Dredge & Dock Corporation, a Delaware
corporation (the “Borrower”), the other Credit Parties party thereto from time
to time, the lenders who are or may become party thereto, as Lenders, and Wells
Fargo Bank, National Association, as Administrative Agent, Swingline Lender and
as an Issuing Lender. Capitalized terms used herein and not defined herein shall
have the meanings assigned thereto in the Credit Agreement.

1. The Administrative Agent is hereby authorized to disburse all Loan proceeds
into the following account(s):

 

  ABA Routing Number:                                     
Account Number:                                           

2. This authorization shall remain in effect until revoked or until a subsequent
Notice of Account Designation is provided to the Administrative Agent.

[Signature Page Follows]

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

IN WITNESS WHEREOF, the undersigned has executed this Notice of Account
Designation as of the day and year first written above.

 

GREAT LAKES DREDGE & DOCK CORPORATION By:       Name:       Title:    

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

EXHIBIT D

FORM OF NOTICE OF PREPAYMENT

Dated as of:                    

Wells Fargo Bank, National Association,

    as Administrative Agent

MAC D 1109-019

1525 West W.T. Harris Blvd.

Charlotte, North Carolina 28262

Attention: Syndication Agency Services

Email: agencyservices.requests@wellsfargo.com

Fax: 704-715-0017

Ladies and Gentlemen:

This irrevocable Notice of Prepayment is delivered to you pursuant to
Section 2.4(c) of the Credit Agreement dated as of June 4, 2012 (as amended,
restated, supplemented or otherwise modified from time to time, the “Credit
Agreement”), by and among Great Lakes Dredge & Dock Corporation, a Delaware
corporation (the “Borrower”), the other Credit Parties party thereto from time
to time, the lenders who are or may become party thereto, as Lenders, and Wells
Fargo Bank, National Association, as Administrative Agent, Swingline Lender and
as an Issuing Lender. Capitalized terms used herein and not defined herein shall
have the meanings assigned thereto in the Credit Agreement.

1. The Borrower hereby provides notice to the Administrative Agent that it shall
prepay the following [Base Rate Loans] and/or [LIBOR Rate Loans]:
$            .6

2. The Loan to be prepaid is [check each applicable box]

 

  ¨ a Swingline Loan

 

  ¨ a Revolving Credit Loan

3. The Borrower shall repay the above-referenced Loans on the following Business
Day:                         .7

[Signature Page Follows]

 

 

6 

Complete with an amount in accordance with Section 2.4 of the Credit Agreement.

7 

Complete with a date no earlier than (i) the same Business Day as of the date of
this Notice of Prepayment with respect to any Swingline Loan or Base Rate Loan
and (ii) three (3) Business Days subsequent to date of this Notice of Prepayment
with respect to any LIBOR Rate Loan.

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

IN WITNESS WHEREOF, the undersigned has executed this Notice of Prepayment as of
the day and year first written above.

 

GREAT LAKES DREDGE & DOCK CORPORATION By:       Name:       Title:    

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EXHIBIT E

FORM OF NOTICE OF CONVERSION/CONTINUATION

Dated as of:                         

Wells Fargo Bank, National Association,

    as Administrative Agent

MAC D 1109-019

1525 West W.T. Harris Blvd.

Charlotte, North Carolina 28262

Attention: Syndication Agency Services

Email: agencyservices.requests@wellsfargo.com

Fax: 704-715-0017

Ladies and Gentlemen:

This irrevocable Notice of Conversion/Continuation (this “Notice”) is delivered
to you pursuant to Section 5.2 of the Credit Agreement dated as of June 4, 2012
(as amended, restated, supplemented or otherwise modified from time to time, the
“Credit Agreement”), by and among Great Lakes Dredge & Dock Corporation, a
Delaware corporation (the “Borrower”), the other Credit Parties party thereto
from time to time, the lenders who are or may become party thereto, as Lenders,
and Wells Fargo Bank, National Association, as Administrative Agent, Swingline
Lender and as an Issuing Lender. Capitalized terms used herein and not defined
herein shall have the meanings assigned thereto in the Credit Agreement.

 

1.    The Loan to which this Notice relates is a Revolving Credit Loan.

2.

   This Notice is submitted for the purpose of: (Check one and complete
applicable information in accordance with the Credit Agreement.)   

¨

   Converting all or a portion of a Base Rate Loan into a LIBOR Rate Loan      
Outstanding principal balance:    $                        Principal amount to
be converted:    $                        Requested effective date of
conversion:       Requested new Interest Period:   

¨

   Converting a portion of LIBOR Rate Loan into a Base Rate Loan      
Outstanding principal balance:    $                        Principal amount to
be converted:    $                        Last day of the current Interest
Period:         Requested effective date of conversion:     

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

¨

   Continuing all or a portion of a LIBOR Rate Loan as a LIBOR Rate Loan      
Outstanding principal balance:    $                        Principal amount to
be continued:    $                        Last day of the current Interest
Period:       Requested effective date of continuation:       Requested new
Interest Period:   

3. The Borrower hereby certifies that the following statements will be true and
correct on the date of the requested [Conversion][Continuation]:

(a) The representations and warranties contained in Article VII of the Credit
Agreement are true and correct in all material respects, except for any
representation and warranty that is qualified by materiality or reference to
Material Adverse Effect, which such representation and warranty is true and
correct in all respects on and as of the date of proposed
[Conversion][Continuation] with the same effect as if made on and as of such
date (except for any such representation and warranty that by its terms is made
only as of an earlier date, which representation and warranty shall remain true
and correct in all material respects, except for any representation and warranty
that is qualified by materiality or reference to Material Adverse Effect, which
such representation and warranty is true and correct in all respects as of such
earlier date).

(b) No Default or Event of Default exists, or would result from, such proposed
[Conversion][Continuation].

[Signature Page Follows]

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

IN WITNESS WHEREOF, the undersigned has executed this Notice of
Conversion/Continuation as of the day and year first written above.

 

GREAT LAKES DREDGE & DOCK CORPORATION By:       Name:       Title:    

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

EXHIBIT F

FORM OF OFFICER’S COMPLIANCE CERTIFICATE

The undersigned, on behalf of Great Lakes Dredge & Dock Corporation, a Delaware
corporation (the “Borrower”), does hereby certify to the Administrative Agent
and the Lenders, each as defined in the Credit Agreement referred to below,
solely in [her] [his] capacity as an officer of the Borrower and not in an
individual capacity, as follows:

1. This certificate is delivered to you pursuant to Section 8.2(a) of the Credit
Agreement dated as of June 4, 2012 (as amended, restated, supplemented or
otherwise modified from time to time, the “Credit Agreement”), by and among the
Borrower, the other Credit Parties party thereto from time to time, the lenders
who are or may become party thereto, as Lenders, and Wells Fargo Bank, National
Association, as Administrative Agent, Swingline Lender and as an Issuing Lender.
Capitalized terms used herein and not defined herein shall have the meanings
assigned thereto in the Credit Agreement.

2. I have reviewed the financial statements of the Borrower and its Subsidiaries
dated as of                         and for the [Fiscal Year ended December 31,
20[        ]] [fiscal quarter ended [                    ], 20[        ]] and
such statements fairly present in all material respects the financial condition,
results of operations and cash flows of the Borrower and its Subsidiaries as of
the dates indicated and the results of their operations for the period[s] then
ended.

3. I have reviewed the terms of the Credit Agreement, and the related Loan
Documents. Such review has not disclosed the existence during or at the end of
such accounting period of any condition or event that constitutes a Default or
an Event of Default, nor do I have any knowledge of the existence of any such
condition or event as at the date of this certificate [except, as set forth
below, which accurately describes the nature of the condition(s) or event(s)
that constitute a Default or an Event of Default and the actions which the
Borrower [is taking] [is planning to take] with respect thereto].

 

 

 

 

 

 

4. The Applicable Margins and calculations determining such figures are set
forth on the attached Schedule 1. The Borrower and its Subsidiaries are in
compliance with the financial covenants contained in Section 9.14 of the Credit
Agreement and the calculations which provide the basis for such certification
are set forth on the attached Schedule 1.

[Signature Page Follows]

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

IN WITNESS WHEREOF the undersigned has executed this Officer’s Compliance
Certificate as of the day and year first written above.

 

GREAT LAKES DREDGE & DOCK CORPORATION By:       Name:       Title:    

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

Schedule 1

to

Officer’s Compliance Certificate

[To be provided in a form acceptable to the Administrative Agent]

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

EXHIBIT G

FORM OF ASSIGNMENT AND ASSUMPTION

This Assignment and Assumption (the “Assignment and Assumption”) is dated as of
the Effective Date set forth below and is entered into by and between [INSERT
NAME OF ASSIGNOR] (the “Assignor”) and [the] [each]8 Assignee identified on the
Schedules hereto as “Assignee” or as “Assignees” (collectively, the “Assignees”
and each an “Assignee”). [It is understood and agreed that the rights and
obligations of [the Assignees][the Assignors]9 hereunder are several and not
joint.]10 Capitalized terms used but not defined herein shall have the meanings
given to them in the Credit Agreement identified below (as amended, restated,
supplemented or otherwise modified, 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 Assignor hereby irrevocably sells and assigns
to [the Assignee] [the respective Assignees], and [the] [each] Assignee hereby
irrevocably purchases and assumes from the Assignor, subject to and in
accordance with the Standard Terms and Conditions and the Credit Agreement, as
of the Effective Date inserted by the Administrative Agent below (i) all of the
Assignor’s rights and obligations in its capacity as a Lender under the Credit
Agreement and any other documents or instruments delivered pursuant thereto to
the extent related to the amount and percentage interest identified in Schedule
1 attached hereto of all of such outstanding rights and obligations of the
Assignor under the Credit Agreement (including without limitation any letters of
credit, guarantees, and swingline loans included thereunder) and (ii) to the
extent permitted to be assigned under applicable law, all claims, suits, causes
of action and any other right of the Assignor (in its capacity as a Lender)
against any Person, whether known or unknown, arising under or in connection
with the Credit Agreement, any other documents or instruments delivered pursuant
thereto or the loan transactions governed thereby or in any way based on or
related to any of the foregoing, including, 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 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 Assignor and, except as expressly provided in this
Assignment and Assumption, without representation or warranty by the Assignor.

 

1.

   Assignor:    [INSERT NAME OF ASSIGNOR]

2.

   Assignee(s):    See Schedules attached hereto

 

8 

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.

9 

Select as appropriate.

10 

Include bracketed language if there are either multiple Assignors or multiple
Assignees.

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

3.

   Borrower:    Great Lakes Dredge & Dock Corporation

4.

   Administrative Agent:    Wells Fargo Bank, National Association, as the
administrative agent under the Credit Agreement

5.

   Credit Agreement:    The Credit Agreement dated as of June 4,2012 among Great
Lakes Dredge & Dock Corporation, as Borrower, the other Credit Parties party
thereto from time to time, the Lenders party thereto, as Lenders, and Wells
Fargo Bank, National Association, as Administrative Agent, Swingline Lender and
as an Issuing Lender (as amended, restated, supplemented or otherwise modified)

6.

   Assigned Interest:    See Schedules attached hereto

[7.

   Trade Date:                                ]11

[Remainder of Page Intentionally Left Blank]

 

 

11 

To be completed if the Assignor and the Assignees intend that the minimum
assignment amount is to be determined as of the Trade Date.

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

Effective Date:                                 , 2             [TO BE INSERTED
BY THE ADMINISTRATIVE 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

[NAME OF ASSIGNOR]

By:

      Title:

ASSIGNEES

See Schedules attached hereto

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

[Consented to and]12 Accepted:

 

WELLS FARGO BANK, NATIONAL ASSOCIATION,

as Administrative Agent, [Issuing Lender and Swingline Lender]

By       Title:

[Consented to:]13

 

GREAT LAKES DREDGE & DOCK CORPORATION

By

      Title:

 

 

12 

To be added only if the consent of the Administrative Agent and/or the Swingline
Lender and Issuing Lender is required by the terms of the Credit Agreement.

13 

To be added only if the consent of the Borrower is required by the terms of the
Credit Agreement.

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

SCHEDULE 1

To Assignment and Assumption

By its execution of this Schedule, the Assignee identified on the signature
block below agrees to the terms set forth in the attached Assignment and
Assumption.

Assigned Interests:

 

Aggregate Amount of

Commitment/

Loans for all Lenders14

   Amount of
Commitment/
Loans Assigned15      Percentage
Assigned of
Commitment/
Loans16      CUSIP Number

$

   $           %      

$

   $           %      

$

   $           %      

 

[NAME OF ASSIGNEE]17 [and is an Affiliate/Approved Fund of [identify Lender]18]

By:

      Title:

 

 

14 

Amount to be adjusted by the counterparties to take into account any payments or
prepayments made between the Trade Date and the Effective Date.

15 

Amount to be adjusted by the counterparties to take into account any payments or
prepayments made between the Trade Date and the Effective Date.

16 

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

17 

Add additional signature blocks, as needed.

18 

Select as applicable.

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

ANNEX 1

to Assignment and Assumption

STANDARD TERMS AND CONDITIONS FOR

ASSIGNMENT AND ASSUMPTION

1. Representations and Warranties.

1.1 Assignor. The Assignor (a) represents and warrants that (i) it is the legal
and beneficial owner of the Assigned Interest, (ii) the Assigned Interest is
free and clear of any lien, encumbrance or other adverse claim and (iii) it has
full power and authority, and has taken all action necessary, to execute and
deliver this Assignment and Assumption and to consummate the transactions
contemplated hereby; and (b) assumes no responsibility with respect to (i) any
statements, warranties or representations made in or in connection with the
Credit Agreement or any other Loan Document, (ii) the execution, legality,
validity, enforceability, genuineness, sufficiency or value of the Loan
Documents or any collateral thereunder, (iii) the financial condition of the
Borrower, any of its Subsidiaries or Affiliates or any other Person obligated in
respect of any Loan Document or (iv) the performance or observance by the
Borrower, any of its Subsidiaries or Affiliates or any other Person of any of
their respective obligations under any Loan Document.

1.2. Assignee[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 12.10(b), (v) and
(vi) of the Credit Agreement (subject to such consents, if any, as may be
required under Section 12.10(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 8.1 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 Administrative 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 Lender, attached to the Assignment and Assumption is
any documentation required to be delivered by it pursuant to the terms of the
Credit Agreement, duly completed and executed by the Assignee; and (b) agrees
that (i) it will, independently and without reliance on the Administrative
Agent, [the] [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 Administrative Agent shall
make all payments in respect of [the] [each] Assigned Interest (including
payments of principal, interest, fees and other amounts) to the Assignor for
amounts which have accrued to but excluding the Effective Date and to [the] [the
relevant] Assignee for amounts which have accrued from and after the Effective
Date.

3. General Provisions. This Assignment and Assumption shall be binding upon, and
inure to the benefit of, the parties hereto and their respective successors and
assigns permitted by the terms of the Credit Agreement. 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 facsimile or in electronic (i.e.,
“pdf” or “tif”) format shall be effective as delivery of a manually executed
counterpart of this Assignment and Assumption. This Assignment and Assumption
shall be governed by, and construed in accordance with, the law of the State of
New York.

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

EXHIBIT H

FORM OF LENDER-SURETY AGREEMENT

(See Attached)

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

LOGO [g363875g86g89.jpg]

   LENDER-SURETY PRIORITY AGREEMENT

THIS LENDER-SURETY PRIORITY AGREEMENT (“Agreement”), dated         , 2012, is
entered into by:

 

  1. WELLS FARGO BANK, N.A., a national banking association, as Administrative
Agent (the “Agent”) for the lenders under the Lender Credit Agreement (as
defined below), and

 

  2. ZURICH AMERICAN INSURANCE COMPANY and its Subsidiaries and Affiliates
including, but not limited to FIDELITY AND DEPOSIT COMPANY OF MARYLAND, COLONIAL
AMERICAN CASUALTY AND SURETY COMPANY, and AMERICAN GUARANTEE AND LIABILITY
INSURANCE COMPANY, its successors and assigns (“Surety”).

Agent and Surety agree that all capitalized terms used in this Agreement but not
defined herein shall have the meaning given such terms in the Equipment
Utilization Agreement, dated June 4, 2012 (the “EUA”), which has been executed
by Indemnitors and Agent.

WHEREAS Great Lakes Dredge & Dock Corporation (“Great Lakes”), Great Lakes
Dredge & Dock Company, LLC, Lydon Dredging & Construction Company, Ltd.,
Fifty-Three Dredging Corporation, Dawson Marine Services Company, Great Lakes
Dredge & Dock Environmental, Inc. (f/k/a Great Lakes Caribbean Dredging, Inc.),
NASDI, LLC, NASDI Holdings Corporation, Yankee Environmental Services, LLC and
Great Lakes Dredge & Dock (Bahamas) Ltd.(collectively, the “Indemnitors”) may
provide Agent a mortgage on certain equipment of Indemnitors (the “Collateral
Equipment”) and a right to attach and perfect a security interest in the
Collateral Equipment, in connection with that certain Credit Agreement, dated as
of June 4, 2012, among Great Lakes, certain subsidiaries of Great Lakes party
thereto, as Credit Parties, Agent and the other lenders party thereto from time
to time (as amended, restated, supplemented, refinanced or replaced from time to
time, the “Lender Credit Agreement”); and

WHEREAS Indemnitors have provided Surety with a security interest in the
Collateral Equipment (among other interests, rights and remedies) pursuant to
the terms of, and as defined in, the General Agreement of Indemnity, dated
September 7, 2011 (the “GIA”); and

WHEREAS Agent and Indemnitors have provided Surety a priority right to access
and use the Collateral Equipment pursuant to the terms of the EUA; and

WHEREAS Agent desires for Surety to agree with Agent in advance on the priority
of their respective mortgages, security interests and liens with respect to the
Collateral Equipment in the event such mortgages security interests and liens
are created or perfected; and

WHEREAS Surety is willing to agree to the priority of Surety’s and Agent’s
respective mortgages, security interests and liens with respect to the
Collateral Equipment, in exchange for Surety’s being granted a second mortgage
on the Collateral Equipment.

 

Great Lakes Lender-Surety Priority Agreement

  page 1 of 9

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NOW THEREFORE, for good and valuable consideration, the sufficiency of which is
hereby acknowledged, Agent and Surety agree as follows:

1. Collateral Equipment: The Collateral Equipment to which this Agreement
applies is defined as the equipment listed on Exhibit A SCHEDULE OF COLLATERAL
EQUIPMENT which is attached to this Agreement and incorporated herein by
reference, as may be modified as provided herein. This Agreement does not apply
to any other machinery, plant, equipment or other property of Indemnitors.

2. Surety Mortgage: Surety agrees that it will not perfect or file mortgages
with respect to any of the Collateral Equipment, unless and until it shall have
first provided Agent with 60 days written notice.

3. Priorities: Agent and Surety acknowledge and agree that the other may perfect
a security interest in the Collateral Equipment. With respect to Agent’s and
Surety’s mortgages, security interests and liens in the Collateral Equipment,
Agent and Surety agree that as between Agent and Surety, Agent’s mortgage,
security interests and liens in the Collateral Equipment shall be senior and
prior in right to Surety’s mortgages, security interests and liens in the
Collateral Equipment, and Surety’s mortgages, security interests and liens shall
be junior to Agent’s mortgages, security interests and liens, notwithstanding
the order, manner or timing of attachment or perfection of any such mortgages,
security interests or liens or the validity, enforceability, perfection or
unavoidability thereof or any failure by Agent or the Surety to take any action
to attach or perfect such security interests or liens.

4. No Challenge: Agent and Surety agree not to institute or join in any legal
action challenging the validity, enforceability, perfection or unavoidability of
their respective mortgages, security interests or liens with respect to the
Collateral Equipment.

5. Right to Enforce and Transfer; Release: Agent and Surety agree that the other
party may take action to enforce that party’s rights and interest in the
Collateral Equipment, including any rights which may result in the transfer of
such Collateral Equipment to third parties, provided that a) the enforcing party
provides prior written notice to the other party of the enforcing party’s
foreclosure or similar disposition of any such Collateral Equipment; b) any such
exercise and enforcement or other disposition by Agent of any Collateral
Equipment shall be subject to and shall not interfere with Surety’s continuing
rights and interests and priority access and use under and pursuant to the terms
of the EUA. In the event of any transfer of such Collateral Equipment to third
parties by the Agent in connection with an enforcement by the Agent or in
connection with a consensual disposition and, in any such event pursuant to
which the Agent shall release its mortgages, security interests or liens with
respect to such Collateral Equipment, Surety shall promptly release its
mortgages, security interests and liens on such Collateral Equipment, provided
that Surety’s mortgages, security interests and liens shall remain on the
proceeds of such Collateral Equipment, subject to the relative priorities set
forth in section 3 above. Surety hereby authorizes Agent to effect such lien
releases on behalf of Surety and to execute and deliver all instruments to
effect such release of Surety’s mortgages, security interests and liens (which
authorization being coupled with an interest, is irrevocable).

6. Modification of Exhibit A. Exhibit A may be modified by a Rider to this
Agreement upon written notice by Agent to Surety at any time.

 

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7. Collateral Proceeds: If any Collateral proceeds (including, without
limitation, insurance proceeds or distributions pursuant to any plan of
reorganization or other insolvency proceeding with respect to any Indemnitor)
are received by Surety with respect to the Collateral Equipment, Surety shall
receive and hold such proceeds on behalf of the other party and shall promptly
pay or transfer such proceeds to the other party, with any necessary
endorsements. To the extent that there are any excess proceeds from the
Collateral Equipment which may be held by Agent following satisfaction in full
of the Indemnitor’s obligations to Agent and the lenders party to the Lender
Credit Agreement and the termination of the commitments under the Lender Credit
Agreement, Agent shall promptly pay or transfer such proceeds to Surety, with
any necessary endorsements.

8. No Prohibition: Neither Agent nor Surety shall enter into any agreement with
any Indemnitor prohibiting such Indemnitor from granting mortgages on, security
interests in, or liens on, any Collateral Equipment to secure the obligations of
such Indemnitor either to Agent and the lenders in connection with the Lender
Credit Agreement or to Surety in connection with the GIA or the EUA.

9. No Impact on Rights and Remedies other than to the Collateral Equipment:
Notwithstanding the respective priorities of security interests and liens above,
nothing in this Agreement is intended to or does waive, release, limit,
condition or otherwise affect the Surety’s rights and remedies under the EUA
and/or the GIA, at law or in equity, other than as stated in this Agreement with
respect to the Collateral Equipment, or Agent’s or any lender’s rights and
remedies under and with respect to the Lender Credit Agreement with respect to
the Collateral Equipment.

10. No impact on Surety’s priority use of the Collateral Equipment:
Notwithstanding the respective priorities of security interests and liens above,
nothing in this Agreement is intended to waive, release, limit, condition or
otherwise affect the Surety’s priority access and use of the Collateral
Equipment to perform Surety’s Bonded Obligations, in accordance with the EUA.

11. Notice: All Notices or requests under this Agreement shall be sent as
follows:

Zurich American Insurance Company

Attn: Vice President, Surety Underwriting

600 Red Brook Blvd., 4th Floor

Owings Mills, MD 21117

with a copy to thomas.littlefield@zurichna.com

Wells Fargo Bank, National Association

Attn: Sushim Shah, Vice President – Global Banking

1000 Louisiana Street, Suite 400

Houston, TX 77002-5027

Email: Sushim.Shah@wellsfargo.com

12. This Agreement shall inure to the benefit of and be binding on the parties
executing this Agreement, the parties acknowledging this Agreement, and their
successors and assigns, including, without limitation, following the
commencement of any bankruptcy or other insolvency proceeding with respect to
any Indemnitor or any Collateral Equipment

 

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13. This Agreement may not be amended or altered in any way except in writing
executed by the parties to this Agreement.

14. This Agreement may be executed in any number of counterparts with separate
signature pages, all of which taken together shall constitute the Agreement, and
any of the parties hereto may execute this Agreement by signing any such
counterpart. Delivery of any executed signature page to this Agreement by
telecopier or pdf attachment to an email shall be equally effective as delivery
of a manually executed original.

15. This Agreement shall be governed by and construed in accordance with the
laws of the State of New York without regard to its conflicts of laws
principles.

SIGNATURE PAGES TO FOLLOW

(The remainder of this page is intentionally left blank)

 

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Signed and sealed this     day of         , 2012

Each of the undersigned hereby affirms to the Surety that he or she is a
secretary or a duly authorized officer, manager, trustee or official of the
business entity for which he or she executes the foregoing Agreement. In such
capacity the undersigned is familiar with all of the documents which establish
the rights which govern the affairs, power and authority of such entity
including, to the extent applicable, the (1) certificate or articles of
incorporation, (2) bylaws, (3) corporate resolutions, (4) trust agreements and
(5) partnership, and operating or limited liability agreements of such business
entity. Having reviewed all such applicable documents and instruments and such
other facts as deemed appropriate, the undersigned hereby affirms that such
entity has the power and authority to enter into such Agreement and that he or
she is duly authorized to do so.

 

     AGENT    WELLS FARGO BANK, N.A.

ATTEST OR WITNESS:

  

 

  

 

Name and Title

   Sushim Shah, Vice President

 

     SURETY

ATTEST OR WITNESS:

   Zurich American Insurance Company

 

  

 

Name and Title

   Patrick A. Hannigan, Senior Regional Vice President

Lender-Surety Agreement acknowledged by:

 

     INDEMNITOR    GREAT LAKES DREDGE & DOCK CORPORATION

ATTEST OR WITNESS:

  

 

  

(SEAL)

Name and Title

   Bruce J. Biemeck, President and Chief Financial Officer

(Signatures continued next page)

 

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     INDEMNITOR    GREAT LAKES DREDGE & DOCK COMPANY, LLC

ATTEST OR WITNESS:

  

 

  

(SEAL)

Name and Title

   Bruce J. Biemeck, President and Chief Financial Officer

 

     INDEMNITOR    LYDON DREDGING & CONSTRUCTION COMPANY, LTD.

ATTEST OR WITNESS:

  

 

  

(SEAL)

Name and Title

   Bruce J. Biemeck, Executive Vice President and Chief Operating Officer

 

     INDEMNITOR    FIFTY-THREE DREDGING CORPORATION

ATTEST OR WITNESS:

  

 

  

(SEAL)

Name and Title

   Paul E. Dinquel, Vice President

 

     INDEMNITOR    DAWSON MARINE SERVICES COMPANY

ATTEST OR WITNESS:

  

 

  

(SEAL)

Name and Title

   Catherine Hoffman, President

(Signatures continued next page)

 

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     INDEMNITOR    GREAT LAKES DREDGE & DOCK ENVIRONMENTAL, INC. (f/k/a Great
Lakes Caribbean Dredging, Inc.)

ATTEST OR WITNESS:

  

 

  

(SEAL)

Name and Title

   Bruce J. Biemeck, Senior Vice President and Chief Financial Officer

 

     INDEMNITOR    NASDI, LLC

ATTEST OR WITNESS:

  

 

  

(SEAL)

Name and Title

   Bruce J. Biemeck, Vice President

 

     INDEMNITOR    NASDI HOLDINGS CORPORATION

ATTEST OR WITNESS:

  

 

  

(SEAL)

Name and Title

   Bruce J. Biemeck, Vice President and Chief Financial Officer

 

     INDEMNITOR    YANKEE ENVIRONMENTAL SERVICES, LLC

ATTEST OR WITNESS:

  

 

  

(SEAL)

Name and Title

   Bruce J. Biemeck, Vice President and Chief Financial Officer

(Signatures continued next page)

 

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     INDEMNITOR    GREAT LAKES DREDGE & DOCK (BAHAMAS) LTD.

ATTEST OR WITNESS:

  

 

  

(SEAL)

Name and Title

   Bruce J. Biemeck, Vice President

(Exhibit follows)

 

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EXHIBIT A

SCHEDULE OF COLLATERAL EQUIPMENT

 

NAME OF VESSEL

  

OFFICIAL NUMBER

JESSIE    273722 ALASKA    283416 G.L. 51    288765 PONTCHARTRAIN    290028
CALIFORNIA    292779 BUSTER    504442 FLORIDA    506446 G.L. 141    538934
CAROLINA    552707 GL-54    560225 NO. 53    566581 ILLINOIS    580274 JACK   
605280 DODGE ISLAND    625348 TEXAS    627368 PADRE ISLAND    639291 OHIO   
644880 G.L. 184    652202 UNLOADER NO. 2    667652 APACHE    668642 KEY WEST   
684596 G.L. 55    1101368 G.L. 142    1139322 GL-66    1151814 MANHATTAN ISLAND
   2694 (RMI Flag) SUGAR ISLAND    2695 (RMI Flag) NOON ISLAND    3097 (RMI
Flag) REEM ISLAND    3098 (RMI Flag)

 

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EXHIBIT I

FORM OF SHIP MORTGAGE

(See Attached)

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FIRST PREFERRED FLEET MORTGAGE

Given By

GREAT LAKES DREDGE & DOCK COMPANY, LLC

As Owner

In Favor Of

WELLS FARGO BANK, NATIONAL ASSOCIATION

As Mortgagee

On the United States Flag Vessels

Named Herein

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SYNOPSIS OF MORTGAGE

 

  

Vessels Subject to

Instrument

  

NAME OF VESSEL

  

OFFICIAL

NUMBER

Type of Instrument:

   First Preferred Fleet Mortgage   

Date of Instrument; effective as of:

               , 2012   

Name of Owner/Mortgagor:

   Great Lakes Dredge & Dock Company, LLC   

(Percentage Owned):

   100%   

Address of Owner

  

2122 York Road

Oak Brook, IL 60523

  

Name of Mortgagee:

   Wells Fargo Bank, National Association   

Address of Mortgagee:

  

1000 Louisiana Street, 4th Floor

Houston, Texas 77002-5027

  

Total Amount of Mortgage

   Two Hundred Twenty-Five Million United States Dollars ($225,000,000) plus
interest, expenses and fees   

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FIRST PREFERRED FLEET MORTGAGE

THIS FIRST PREFERRED FLEET MORTGAGE is made and dated as of             , 2012
(hereinafter the “Mortgage”) by GREAT LAKES DREDGE & DOCK COMPANY, LLC, a
Delaware limited liability company, with its address at 2122 York Road, Oak
Brook, Illinois 60523 (the “Mortgagor”), to WELLS FARGO BANK, NATIONAL
ASSOCIATION, as Administrative Agent and trustee for the financial institutions
from time to time party to the Credit Agreement referred to below, having an
address at 1000 Louisiana Street, 4th Floor, Houston, Texas 77002-5027 (Wells
Fargo Bank, National Association acting in such capacity, the “Mortgagee”).
Capitalized terms used herein shall, unless otherwise defined herein, have the
meanings provided in the Credit Agreement referred to below.

WHEREAS, the Mortgagor is the sole owner of the vessels hereinafter identified
as the “Vessels”, which vessels have been duly documented in the name of the
Mortgagor under the laws of the United States;

WHEREAS, Great Lakes Dredge & Dock Corporation, a Delaware corporation (“Great
Lakes”, or the “Borrower”), the Mortgagor’s direct parent corporation, has
entered into that certain Credit Agreement dated as of             , 2012 by and
among the Borrower, certain subsidiaries of the Borrower (including the
Mortgagor) from time to time party thereto as Credit Parties, the financial
institutions from time to time party thereto as Lenders and Wells Fargo Bank,
National Association, as Administrative Agent, Swingline Lender and an Issuing
Lender (as the same may be amended, restated, supplemented or otherwise modified
from time to time, the “Credit Agreement”), under which loans and other
financial accommodations heretofore have been and may hereafter be made to or
for the benefit of the Borrower;

WHEREAS, the Mortgagor has together with certain other subsidiaries of the
Borrower, entered into that certain Subsidiary Guaranty dated as of
            , 2012 (as the same may be amended, restated, supplemented or
otherwise modified from time to time, the “Guaranty”), pursuant to which the
Mortgagor has guaranteed all of the Facility Obligations (which guaranty
obligations of the Mortgagor, all other payment and performance obligations of
the Mortgagor under this Mortgage, and all other obligations of the Mortgagor
under the other Loan Documents to which the Mortgagor is a party, are
hereinafter referred to collectively as the “Secured Obligations”);

WHEREAS, upon the occurrence of a Perfection Trigger Event, the Mortgagor has
agreed to secure the Secured Obligations with, among other things, first
preferred ship mortgages on certain vessels owned by the Mortgagor and
documented under the laws of the United States in the maximum principal amount
of U.S. $225,000,000, plus interest, expenses and fees; and

WHEREAS, the Credit Agreement (excluding Exhibits and Schedules) is attached to
this Mortgage as Exhibit A hereto;

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NOW THEREFORE, THIS MORTGAGE WITNESSETH that in consideration of the premises
and of the additional covenants herein contained and for other good and valuable
consideration, the receipt and adequacy of which are hereby acknowledged, and as
security only for the performance and payment of the Secured Obligations when,
if and as due, and all other sums which may be secured by this Mortgage
effective upon the occurrence of a Perfection Trigger Event, the Mortgagee shall
hereby and automatically (and without the necessity of any further action by any
person) have granted, conveyed, mortgaged, pledged, granted a security interest
in, confirmed, transferred and set over, and, effective upon the occurrence of a
Perfection Trigger Event, by these presents does grant, convey, mortgage,
pledge, grant a security interest in, confirm, assign, transfer and set over
unto the Mortgagee the whole of the Vessels identified in Schedule A attached
hereto and incorporated herein, and each of them, together with all of their
boilers, engines, machinery, masts, spars, sails, rigging, boats, anchors,
cables, chains, tackle, apparel, furniture, fittings, cranes, drills,
excavators, shovels, construction and other equipment and all other
appurtenances thereunto appertaining or belonging, whether now or hereafter
acquired, and also any and all additions, improvements and replacements
hereafter made in or to said Vessels, or in or to their equipment and
appurtenances aforesaid (each a “Vessel” and, collectively, the “Vessels”), as
well as the proceeds of the Vessels;

TO HAVE AND TO HOLD all and singular the foregoing mortgaged and described
property unto the Mortgagee and its successors and assigns (including successors
by way of merger, acquisition or similar event), to its and its successors’ and
assigns’ own use, benefit and behoof, forever;

PROVIDED, HOWEVER, and these presents are upon the condition that the Mortgagee
agrees that the liens created by this Mortgage and the estate and rights hereby
granted shall not become effective until (i) the occurrence of a Perfection
Trigger Event, and (ii) the due filing of this Mortgage in accordance with the
provisions of Chapter 313 of Title 46, United States Code, as amended (“Chapter
313”), and shall cease, determine and terminate upon the earliest to occur of
(x) the Termination Date, (y) a Release Date, and (z) the Springing Lien
Termination Date, otherwise to remain in full force and effect.

IT IS HEREBY COVENANTED, DECLARED AND AGREED that the property above described
is to be held subject to the further agreements and conditions hereinafter set
forth.

ARTICLE I

REPRESENTATIONS, WARRANTIES AND

COVENANTS OF THE MORTGAGOR

The Mortgagor represents, warrants, covenants and agrees with Mortgagee as
follows:

SECTION l. The Mortgagor hereby agrees with the Mortgagee duly and promptly to
perform and to observe the Secured Obligations.

SECTION 2. Upon the occurrence of a Perfection Trigger Event, the Mortgagor will
promptly cause this Mortgage to be duly filed in accordance with the provisions
of Chapter 313 and will otherwise cause compliance with and satisfaction of all
of the provisions of Chapter 313 in order to establish and maintain this
Mortgage as a first preferred mortgage lien thereunder

 

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upon the Vessels and upon all renewals, replacements, supplements, amendments
and improvements made in or to the same for the amount indicated in Section 1 of
Article III hereof. The Mortgagor shall promptly pay and discharge all United
States Coast Guard fees and expenses in connection with the recordation of this
Mortgage and any such renewals, replacements, supplements, amendments and
improvements.

SECTION 3. In the event that this Mortgage or the Secured Obligations, or any
provision hereof or thereof, shall be deemed invalidated in whole or in part by
reason of any present or future law or any decision of any authoritative court,
or if the documents at any time held by the Mortgagee shall be deemed by the
Mortgagee for any reason insufficient to carry out the true intent and spirit of
this Mortgage, or the Secured Obligations, then, from time to time, the
Mortgagor will execute, on its own behalf such other and further assurances and
documents as in the reasonable opinion of the Mortgagee may be required more
effectively to subject the Vessels to the terms and provisions of this Mortgage,
including the payment of all sums required to be paid under the Secured
Obligations hereby secured.

SECTION 4. (a) Promptly following the occurrence of any Perfection Trigger Event
and the subsequent recordation of this Mortgage in accordance with Section 2 of
this Article I, the Mortgagor shall place a properly certified copy of this
Mortgage on board each Vessel with its papers and will cause the same to be
shown to any person having business with the Vessel which might create or imply
any commitment or encumbrance whatsoever on the Vessel and shall cause a notice,
reading as follows (or containing such additional information relating to any
permitted mortgage that is placed on a Vessel as may be approved by the
Mortgagor) printed in plain type of such size that the paragraph of reading
matter shall cover a space not less than six inches wide by nine inches high,
and framed, to be placed and kept prominently exhibited in the chart room and in
the master’s cabin of each of the Vessels if such room and cabin are contained
in the Vessel and, if not, where such notices customarily are kept for vessels
of the type of the Vessel:

“NOTICE OF SHIP MORTGAGE

This vessel is owned by Great Lakes Dredge & Dock Company, LLC, a Delaware
limited liability company, and is covered by a First Preferred Fleet Mortgage in
favor of Wells Fargo Bank, National Association, as Administrative Agent and
trustee, under authority of Chapter 313 of Title 46 of the United States Code,
as amended. Under the terms of said Mortgage, neither the owner, the master or
agent of this vessel nor any other person has any right, power or authority to
create, incur, or permit to be placed or imposed upon this vessel any lien
whatsoever, other than liens for wages of a stevedore when employed directly by
a person listed in 46 U.S.C. 31341, for wages of the crew in respect of this
vessel (including wages of the master to the extent provided by 46 U.S.C.
11112), general average, salvage (including contract salvage), liens fully
covered by insurance and any deductible applicable thereto, liens permitted by
Section 9.2 of the Credit Agreement, and other liens incident to current
operations or for repairs.”

 

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(b) The Mortgagor will not create, incur, permit to be placed or imposed upon or
permit to exist upon any of the Vessels or any of the proceeds of the Vessels or
sums due or to become due in respect of the Vessels or in respect of insurance
thereon any lien whatsoever, other than liens contemplated by the aforesaid
notice. In due course and in any event within thirty (30) days after the same
becomes due and payable, the Mortgagor shall pay or cause to be discharged or
make adequate provision for the satisfaction or discharge of all material claims
or demands with respect to the Vessels, unless such claims or demands are being
contested in good faith.

SECTION 5. (a) The Mortgagor will not transfer or change the flag, change the
vessel name or change the vessel number of any of the Vessels without the
written consent of the Mortgagee first had and obtained, and any such written
consent to any one transfer or change of flag, change in vessel name or change
in vessel number shall not be construed to be a waiver of this provision with
respect to any subsequent proposed transfer or change of flag, change in vessel
name or change in vessel number of the same or any other Vessel.

(b) The Mortgagor will not cause or permit any of the Vessels to be operated in
any manner contrary to law and the Mortgagor will not engage in any unlawful
trade or violate any law or expose any of the Vessels to penalty or forfeiture,
except where any such operation, engagement, violation or exposure could not
reasonably be expected to have a Material Adverse Effect, and will not do, or
suffer or permit to be done, anything which can or may injuriously affect in any
material respect the registration, documentation, or trade endorsement of a
Vessel under the laws and regulations of the United States.

(c) Without limiting in any way the right of the Mortgagee to decline to grant
any written consent described in Section 5(a) or to condition any such written
consent on other conditions, it is expressly understood and agreed that the
Mortgagee shall not grant any such written consent unless either: (i) the
Mortgagee is satisfied that all actions necessary or desirable have been taken
so that after giving effect to the proposed transfer or change the Mortgagee
will, upon the occurrence of any Perfection Trigger Event, have a valid and
enforceable first lien on the Vessels which are the subject hereof providing
rights (including practically realizable enforcement rights) and benefits to the
Mortgagee with respect to such Vessels at least as favorable to the Mortgagee as
those granted to the Mortgagee with respect thereto by this Mortgage or (ii) the
Mortgagor substitutes for such Vessels as collateral under this Mortgage other
vessels owned by the Mortgagor (including all appurtenances thereunto
appertaining or belonging and any and all additions, improvements and
replacements thereto) such that, after giving effect to any such substitution,
the aggregate orderly liquidation value of all vessels subject to the Ship
Mortgages is equal to at least: (x) prior to the first Incremental Commitment
Increase, $260,000,000, and (y) on and after each Incremental Commitment
Increase, 1.5 times the Aggregate Commitment, immediately after giving effect to
such Incremental Commitment Increase.

SECTION 6. (a) From and after any Perfection Trigger Event, in the event of an
actual, constructive or compromised total loss of any Vessel, such loss shall
not be adjusted or compromised without the prior written consent of the
Mortgagee, and all insurance or other payments for such shall, unless the
Mortgagor is entitled to reinvest such payments in accordance with Section 2.4
of the Credit Agreement and does elect to so reinvest, be paid to the

 

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Mortgagee and applied by the Mortgagee as follows: first, to any costs or
expenses of the Mortgagee in connection with collecting such payment; second, to
the payment of the Secured Obligations; third, to the payment of all other
secured indebtedness, if any; and fourth, any surplus thereafter remaining, to
the Mortgagor, its successors and assigns or to whomever may be lawfully
entitled to receive the same.

(b) In the event that any claim or lien is asserted against any Vessel for loss,
damage or expense which is covered by insurance required hereunder, and it is
necessary for the Mortgagor to obtain a bond or supply other security to prevent
arrest of the Vessel or to release the Vessel from arrest on account of such
claim or lien, the Mortgagee, on request of the Mortgagor or its agent, may, in
the sole discretion of the Mortgagee, assign to any person, firm or corporation
executing a surety or guarantee bond or other agreement to save or release the
Vessel from such arrest, all right, title and interest of the Mortgagee in and
to said insurance covering said loss, damage or expense, as collateral security
to indemnify against liability under said bond or other agreement. In any such
event, Mortgagor shall promptly notify Mortgagee in writing of any such arrest
or threatened arrest and, within thirty (30) days, cause such Vessel to be
released by posting security or otherwise.

(c) If requested by the Mortgagee at any time and from time to time, the
Mortgagor will deliver to the Mortgagee copies of all cover notes, binders,
policies and certificates of entry in protection and indemnity associations, and
all endorsements and riders amendatory thereof, in respect of insurance
maintained in connection with the Vessels.

(d) The Mortgagor agrees that it will not do or permit or willingly allow to be
done any act by which any insurance required by the terms of this Mortgage may
be suspended, impaired or cancelled, and that it will not permit or allow any
Vessel to undertake any voyage or run any risk or transport any cargo or
passengers which may not be permitted by the policies in force, without having
previously insured the Vessel by additional coverage extending to such voyages,
risks, passengers or cargoes.

SECTION 7. The Mortgagor shall promptly notify the Mortgagee of the actual or
constructive total loss of a Vessel or the agreed or compromised total loss of a
Vessel, or the arrest, capture, condemnation, confiscation, registration,
seizure or forfeiture of a Vessel.

SECTION 8. The Mortgagor represents and warrants that it is and will at all
times remain a citizen of the United States within the meaning of Section 2 of
the Shipping Act, 1916, and pursuant to 46 U.S.C. Section 12103(b) and 46 U.S.C.
Section 50501, as amended, entitled to own, document and operate vessels in the
coastwise trade under the laws of the United States. The Mortgagor further
represents and warrants that the address of its chief executive office is 2122
York Road, Oak Brook, Illinois 60523.

ARTICLE II

DEFAULTS AND REMEDIES

SECTION 1. For all purposes of this Mortgage the term “Default” shall mean when
any of the following events shall have occurred:

(a) An Event of Default under the Credit Agreement;

 

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(b) A failure in the due and punctual observance and performance by the
Mortgagor of any of the provisions of Section 6(b) of Article I hereof;

(c) A failure in the due and punctual observance and performance by the
Mortgagor of any of the provisions of Section 6(a) of Article I hereof which
shall continue without being cured by the Mortgagor for a period of ten
(10) Business Days after an officer of the Mortgagor first has knowledge of such
failure or the Mortgagor receives written notice thereof from the Mortgagee,
whichever is earlier;

(d) A failure in the due and punctual observance and performance by the
Mortgagor of any provision of this Mortgage which shall continue without being
cured by the Mortgagor for a period of thirty (30) days after written notice
thereof shall have been given by the Mortgagee to the Mortgagor; or

(e) The Mortgagor shall abandon any Vessel, other than in connection with an
insured actual, constructive or compromised total loss of such Vessel.

SECTION 2. If any Default shall occur and be continuing uncured, then at any
time thereafter while such Default shall remain uncured, the Mortgagee shall
have the right to exercise any or all of the remedies resulting therefrom under
the terms of the Credit Agreement and, if a Perfection Trigger Event shall have
occurred and be continuing, any or all of the following remedies:

(a) Exercise all of the rights and remedies in foreclosure and otherwise given
to mortgagees by Chapter 313 or by any other provisions of applicable law;

(b) Bring suit at law, in equity or in admiralty, as it may be advised, to
recover judgment in respect of the Secured Obligations and any and all payments
due under the Secured Obligations and hereunder, and collect the same out of any
and all of the collateral held by the Mortgagee for the Secured Obligations
whether covered by this Mortgage or otherwise and in connection therewith obtain
a decree ordering the sale of any or all of the Vessels in accordance with
subsection (d) of this Section 2;

(c) The Mortgagee may take and enter into possession of any or all of the
Vessels, at any time, wherever the same may be, without legal process and
without being responsible for loss or damage, and the Mortgagor or other person
in possession forthwith upon demand of the Mortgagee shall surrender to the
Mortgagee possession of each such Vessel demanded and, once in possession of any
such Vessel, the Mortgagee may, without being responsible for loss or damage,
hold, lay up, lease, charter, operate or otherwise use the Vessel for such time
and upon such terms as it may deem to be for its best advantage, and demand,
collect and retain all hire, freights, earnings, issues, revenues, income,
profits, return premiums, salvage awards or recoveries, recoveries in general
average, and all other sums due or to become due in respect of the Vessel or in
respect of any insurance thereon from any person whomsoever, accounting only for
the net profits, if any, arising from such use of the Vessel and charging upon
all receipts from the use of such Vessel or from the sale thereof by court
proceedings or pursuant to subsection (d) of this Section 2, all costs,
expenses, charges, damages or losses by reason of such use; and if at any time
the Mortgagee shall avail itself of the right herein given to it to take

 

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any or all of the Vessels, the Mortgagee shall have the right to dock each
Vessel taken, for a reasonable time at any dock, pier or other premises of any
person in possession of such Vessel without charge, or to dock any or all of the
Vessels taken at any other place at the cost and expense of the Mortgagor; and

(d) The Mortgagee may take and enter into possession of any or all of the
Vessels, at any time, wherever the same may be, without legal process, and, once
in possession of each of the Vessels taken, if it seems desirable to the
Mortgagee and without being responsible for loss or damage, sell each such
Vessel, at any place and at such time as the Mortgagee may specify and in such
manner as the Mortgagee may deem advisable, free from any claim by the Mortgagor
in admiralty, in equity, at law or by statute, after first giving notice of the
time and place of sale with a general description of the property in the
following manner:

 

  (i) By publishing such notice for ten (10) consecutive business days in a
daily newspaper of general circulation published in New York City;

 

  (ii) If the place of sale should not be New York City, then also by
publication of a similar notice for a similar period of time in a daily
newspaper, if any, published at the place of sale; and

 

  (iii) By mailing, by registered or certified mail, a similar notice to the
Mortgagor on the day of first publication and at least thirty (30) days prior to
the date fixed for sale.

The Mortgagee may adjourn any such sale from time to time by announcement at the
time and place appointed for such sale or for such adjourned sale, and without
further notice or publication the Mortgagee may make any such sale at the time
and place to which the same shall be so adjourned. Any such sale may be
conducted without bringing the Vessels subject to such sale to the place
designated for such sale and in such manner as the Mortgagee may deem to be for
its best advantage.

SECTION 3. Any sale of any or all of the Vessels made pursuant to this Mortgage,
whether under the power of sale hereby granted or any judicial proceedings,
shall operate to divest all right, title and interest of any nature whatsoever
of the Mortgagor therein and thereto, and shall bar the Mortgagor, its
successors and assigns, and all persons claiming by, through or under them from
claiming any interest in or with respect to each Vessel sold. No purchaser shall
be bound to inquire whether notice has been given, or whether any Default has
occurred, or as to the propriety of the sale, or as to the application of the
proceeds thereof. At any such sale, the Mortgagee may bid for and purchase such
property and upon compliance with the terms of sale may hold, retain and dispose
of such property without further accountability therefor.

SECTION 4. Provided that a Perfection Trigger Event shall have occurred, the
Mortgagee is hereby appointed attorney-in-fact of the Mortgagor in the name of
the Mortgagor at any time following the occurrence and during the continuation
of any Default, to execute and deliver to any purchaser aforesaid, and is hereby
vested with full power and authority to make, in the name and in behalf of the
Mortgagor, a good conveyance of the title to each Vessel sold. In

 

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the event of any sale of a Vessel, under any power herein contained, the
Mortgagor will, if and when required by the Mortgagee, execute such form of
conveyance of such Vessel, as the Mortgagee may direct or approve. The Mortgagor
hereby consents to the appointment of a consent keeper or substitute custodian
by the Mortgagee with the costs thereof to be a cost of the sale to be paid from
the proceeds of the sale or by the Mortgagor and, therefore, secured by this
Mortgage as additional Secured Obligations.

SECTION 5. Without limiting in any way the provisions of Section 6 of Article I
hereof, the Mortgagee is hereby appointed attorney-in-fact of the Mortgagor in
the name of the Mortgagor at any time following the occurrence and during the
continuation of any Default and provided that a Perfection Trigger Event shall
have occurred, to demand, collect, receive, compromise and sue for, so far as
may be permitted by law, all freight, hire, earnings, issues, revenues, income
and profits of any or all of the Vessels and all amounts due from underwriters
under any insurance thereon as payment of losses or as return premiums or
otherwise, salvage awards and recoveries, recoveries in general average or
otherwise, and all other sums due or to become due at the time of the happening
of any Default in respect of such Vessel or Vessels, or in respect of any
insurance thereon, from any person whomsoever, and to make, give and execute in
the name of the Mortgagor, acquittances, receipts, releases or other discharges
for the same, whether under seal or otherwise, and to endorse and accept in the
name of the Mortgagor all checks, notes, drafts, warrants, agreements and other
instruments in writing with respect to the foregoing.

SECTION 6. The Mortgagee may, whenever any right to enter and take possession of
any or all of the Vessels accrues to the Mortgagee hereunder, require the
Mortgagor to deliver, and the Mortgagor shall on demand, at its own cost and
expense, deliver, to the Mortgagee each Vessel as demanded. If any legal
proceedings shall be taken to enforce any right under this Mortgage, the
Mortgagee shall be entitled as a matter of right to the appointment of a
receiver of any or all of the Vessels and of the freights, hire, earnings,
issues, revenues, income and profits due or to become due and arising from the
operation thereof.

SECTION 7. Provided that a Perfection Trigger Event shall have occurred, upon
the occurrence and during the continuation of a Default, the Mortgagor
authorizes and empowers the Mortgagee or its appointees or any of them to appear
in the name of the Mortgagor, its successors and assigns, in any court of any
country or nation of the world where a suit is pending against any of the
Vessels because of or on account of any alleged lien against such Vessel from
which such Vessel has not been released other than the lien of this Mortgage,
and to take such proceedings as to her as may seem proper towards the defense of
such suit and the purchase or discharge of such lien, and all expenditures made
or incurred by it for the purpose of such defense or purchase or discharge shall
be a debt due from the Mortgagor, its successors and assigns, to the Mortgagee,
and shall be secured by the lien of this Mortgage in like manner and extent as
if the amount and description thereof were written herein.

SECTION 8. Each and every power and remedy herein given to the Mortgagee shall
be cumulative and shall be in addition to every other power and remedy herein
given or now or hereafter existing at law, in equity, in admiralty or by
statute, and each and every power and remedy whether herein given or otherwise
existing may be exercised from time to time and as often and in such order as
may be deemed expedient by the Mortgagee, and the exercise or the

 

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beginning of the exercise of any power or remedy shall not be construed to be a
waiver of the right to exercise at the same time or thereafter any other power
or remedy. No delay or omission by the Mortgagee in the exercise of any right or
power or in the pursuance of any remedy accruing upon any Default shall impair
any such right, power or remedy or be construed to be a waiver of any such
Default or to be an acquiescence therein; nor shall the acceptance by the
Mortgagee of any security or of any payment of or on account of the amounts due
in respect of the Secured Obligations after any Default or of any payment on
account of any past Default be construed to be a waiver of any right to take
advantage of any future Default or of any past Default not completely cured
thereby.

SECTION 9. If at any time after a Default and prior to the actual sale of any of
the Vessels by the Mortgagee or prior to any foreclosure proceedings, the
Mortgagor offers to cure completely all Defaults and to pay all expenses,
advances and damages to the Mortgagee consequent on such Defaults, then the
Mortgagee shall accept such offer, cure and payment and restore the Mortgagor to
its former position, but such action shall not affect any subsequent Default or
impair any rights consequent thereon.

SECTION 10. In case the Mortgagee shall have proceeded to enforce any right,
power or remedy under this Mortgage by foreclosure, entry or otherwise, and such
proceedings shall have been discontinued or abandoned for any reason or shall
have been determined adversely to the Mortgagee, then and in every such case the
Mortgagor and the Mortgagee shall be restored to their former positions and
rights hereunder with respect to the property subject or intended to be subject
to this Mortgage, and all rights, remedies and powers of the Mortgagee shall
continue as if no such proceedings had been taken.

SECTION 11. Following the occurrence of a Perfection Trigger Event, the proceeds
of any sale of any or all of the Vessels, earnings of any charter operation or
other use of any or all of the Vessels by the Mortgagee under any of the powers
herein specified, and any and all other moneys received by the Mortgagee
pursuant to or under the terms of this Mortgage or in any proceedings hereunder,
the application of which has not elsewhere herein, in the Credit Agreement or in
the Intercreditor Agreement been specifically provided for, shall be applied or
held as follows:

 

  First: Applied to the payment of all reasonable out-of-pocket expenses and
charges, including the expenses of any sale, the expenses of any retaking,
attorneys’ fees, court costs, and any other expenses or advances made or
incurred by the Mortgagee in the protection of its rights or the pursuance of
its remedies hereunder;

 

  Second: Applied to the payment of any damages or injuries sustained by the
Mortgagee occasioned by noncompliance by the Mortgagor with the terms and
provisions of this Mortgage and to furnish indemnity in the proper amount
against any other liens or other encumbrances which have or may have priority
over those established by this Mortgage;

 

  Third: Applied to the payment of the Secured Obligations in such priority as
the Mortgagee may elect;

 

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  Fourth: Applied to the payment of any other obligations secured by the Vessels
which are known to the Mortgagee to exist and to be so secured; and

 

  Fifth: Any surplus thereafter remaining shall be paid promptly to the
Mortgagor.

SECTION 12. Until a Perfection Trigger Event shall have occurred and one or more
Defaults shall occur and continue in existence, the Mortgagor, subject to the
provisions of this Mortgage, (a) shall be suffered and permitted to retain
actual possession and use of the Vessels and (b) shall have the right, from time
to time, in its discretion, and without application to the Mortgagee, and
without obtaining a release thereof by the Mortgagee, to dispose of, free from
the lien hereof, any boilers, engines, machinery, masts, spars, sails, rigging,
boats, anchors, cables, chains, tackle, apparel, furniture, fittings, cranes,
drills, excavators, shovels, construction or other equipment or any other
appurtenances of the Vessels that are no longer useful, necessary, profitable or
advantageous in the operation of the Vessels.

ARTICLE III

SUNDRY PROVISIONS

SECTION 1. For the purposes of this Mortgage and Chapter 313, the maximum amount
of the direct or contingent obligations outstanding at any one time that is or
may become secured by this Mortgage is the principal sum of U.S. $225,000,000,
plus interest, expenses and fees. The discharge amount is the same as the
maximum amount.

SECTION 2. The names and addresses of each of the parties to this Mortgage are
as follows:

(a) Mortgagor: Great Lakes Dredge & Dock Company, LLC, 2122 York Road, Oak
Brook, Illinois 60523;

(b) Mortgagee: Wells Fargo Bank, National Association, as Administrative Agent,
1000 Louisiana Street, 4th Floor, Houston, Texas 77002-5027.

SECTION 3. All of the covenants, promises, stipulations and agreements of the
Mortgagor contained in this Mortgage shall bind the Mortgagor and its successors
and assigns (including successors by way of merger, acquisition or similar
event) and shall inure to the benefit of the Mortgagee and its successors and
assigns (including successors by way of merger, acquisition or similar event).
In the event of any assignment of this Mortgage, the term “Mortgagee”, as used
in this Mortgage, shall be deemed to mean any such assignee.

SECTION 4. Wherever and whenever herein any right, power or authority is granted
or given to the Mortgagee, such right, power or authority may be exercised in
all cases by the Mortgagee or such agent or agents as it may appoint, and the
act or acts of such agent or agents when taken shall constitute the act of the
Mortgagee hereunder.

SECTION 5. This Mortgage may be executed in any number of counterparts, each of
which shall be an original; but such counterparts shall together constitute but
one and the same instrument.

 

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SECTION 6. Unless otherwise specifically provided herein, all notices required
or permitted by the terms hereof shall be given in the manner and with the
effect provided for in the Credit Agreement.

SECTION 7. At the reasonable request of the Mortgagee, to the extent reasonably
available to the Mortgagor, the Mortgagor will cause to be delivered to
Mortgagee for inspection, copies of any and all material contracts and documents
relating to the Vessels, whether on board or not, subject to the confidentiality
provisions set forth in the Credit Agreement.

SECTION 8. This Mortgage may be amended or supplemented from time to time, but
only by an instrument in writing executed by the Mortgagor and the Mortgagee and
duly acknowledged pursuant to Chapter 313.

SECTION 9. THIS MORTGAGE AND ALL THE RIGHTS AND OBLIGATIONS OF THE PARTIES
HEREUNDER AND THEIR SUCCESSORS AND ASSIGNS SHALL BE GOVERNED BY THE LAWS OF THE
STATE OF NEW YORK, INCLUDING SECTIONS 5-1401 AND 5-1402 OF THE NEW YORK GENERAL
OBLIGATIONS LAW BUT EXCLUDING ALL OTHER CHOICE OF LAW AND CONFLICTS OF LAWS, AND
EXCEPT TO THE EXTENT PREEMPTED BY APPLICABLE FEDERAL AND MARITIME LAWS OF THE
UNITED STATES.

SECTION 10. The Mortgagee may permit the separate discharge of one or more
Vessels or of property that is not a vessel from the lien of this Mortgage as
permitted by the Credit Agreement.

SECTION 11. Notwithstanding any other provisions of this Mortgage to the
contrary, nothing herein shall waive the preferred status of this Mortgage and
if any provision herein shall be construed to waive such status, such provision
shall, to the extent so construed, be void and of no effect.

Execution Follows

* * * *

 

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IN WITNESS WHEREOF, the Mortgagor has executed this Mortgage as of the day and
year first above written.

 

GREAT LAKES DREDGE & DOCK

    COMPANY, LLC

By:     Name:   Bruce J. Biemeck Title:   President and Chief Financial Officer

ACKNOWLEDGMENT

 

STATE OF ILLINOIS   )   ) ss.: COUNTY OF           )

The foregoing instrument was acknowledged before me this              day of
            , 2012, by Bruce J. Biemeck, the President and Chief Financial
Officer of GREAT LAKES DREDGE & DOCK COMPANY, LLC, a Delaware limited liability
company, on behalf of the company.

Notary Public

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

SCHEDULE A

LIST OF VESSELS

 

NAME OF VESSEL

 

OFFICIAL NUMBER

 

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

EXHIBIT A

CREDIT AGREEMENT

(See attached)

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

EXHIBIT J-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 Credit Agreement dated as of June 4, 2012 (as
amended, supplemented or otherwise modified from time to time, the “Credit
Agreement”), among Great Lakes Dredge & Dock Corporation, the other Credit
Parties from time to time party thereto, each lender from time to time party
thereto and Wells Fargo Bank, National Association, as Administrative Agent.

Pursuant to the provisions of Section 5.11 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 the Borrower within the meaning of Section 871(h)(3)(B) of the Code and
(iv) it is not a controlled foreign corporation related to the Borrower as
described in Section 881(c)(3)(C) of the Code.

The undersigned has furnished the Administrative Agent and the Borrower with a
certificate of its non-U.S. Person status on IRS Form W-8BEN. By executing this
certificate, the undersigned agrees that (1) if the information provided on this
certificate changes, the undersigned shall promptly so inform the Borrower and
the Administrative Agent, and (2) the undersigned shall have at all times
furnished the Borrower and the Administrative 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:

Date:             , 20[ ]

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

EXHIBIT J-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 Credit Agreement dated as of June 4, 2012 (as
amended, supplemented or otherwise modified from time to time, the “Credit
Agreement”), among Great Lakes Dredge & Dock Corporation, the other Credit
Parties from time to time party thereto, each lender from time to time party
thereto and Wells Fargo Bank, National Association, as Administrative Agent.

Pursuant to the provisions of Section 5.11 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 the Borrower within the meaning of
Section 871(h)(3)(B) of the Code, and (iv) it is not a controlled foreign
corporation related to the 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. 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:

Date:             , 20[ ]

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

EXHIBIT J-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 Credit Agreement dated as of June 4, 2012 (as
amended, supplemented or otherwise modified from time to time, the “Credit
Agreement”), among Great Lakes Dredge & Dock Corporation, the other Credit
Parties from time to time party thereto, each lender from time to time party
thereto and Wells Fargo Bank, National Association, as Administrative Agent.

Pursuant to the provisions of Section 5.11 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 the
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 the 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 (ii) an
IRS Form W-8IMY accompanied by an IRS Form W-8BEN 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:

Date:             , 20[ ]

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

EXHIBIT J-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 Credit Agreement dated as of June 4, 2012 (as
amended, supplemented or otherwise modified from time to time, the “Credit
Agreement”), among Great Lakes Dredge & Dock Corporation, the other Credit
Parties from time to time party thereto, each lender from time to time party
thereto and Wells Fargo Bank, National Association, as Administrative Agent.

Pursuant to the provisions of Section 5.11 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 the 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 the
Borrower as described in Section 881(c)(3)(C) of the Code.

The undersigned has furnished the Administrative Agent and the 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 (ii) an IRS Form W-8IMY accompanied by an IRS Form W-8BEN 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 the Borrower and the Administrative Agent, and (2) the
undersigned shall have at all times furnished the Borrower and the
Administrative 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:

Date:             , 20[ ]

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

EXHIBIT K

FORM OF FINANCIAL CONDITION/SOLVENCY CERTIFICATE

(See Attached)

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

SOLVENCY AND FINANCIAL CONDITION CERTIFICATE

            , 2012

This Solvency and Financial Condition Certificate (this “Certificate”) is
delivered pursuant to Section 6.1(f)(iii) of the Credit Agreement, dated as
of         , 2012 (the “Credit Agreement”), among Great Lakes Dredge & Dock
Corporation, a Delaware corporation (the “Borrower”), the other Credit Parties
from time to time party thereto, the financial institutions from time to time
party thereto (the “Lenders”) and Wells Fargo Bank, National Association, as
Administrative Agent (in such capacity, together with any successor
Administrative Agent appointed pursuant to Section 11.6 of the Credit Agreement,
the “Agent”). Capitalized terms used herein but not otherwise defined herein
shall have the meanings ascribed to them in the Credit Agreement.

The undersigned being the duly elected President and Chief Financial Officer of
the Borrower does hereby certify to the Agent and the Lenders, solely in his
capacity as an officer of the Borrower and not in an individual capacity, on
behalf of the Borrower as follows:

 

  1. After giving effect to the Transactions, the Credit Parties, on a
Consolidated basis, are Solvent.

 

  2. After giving effect to the Transactions, the Borrower and its Subsidiaries
are in compliance with the Closing Leverage Ratio as of the Closing Date.

[signature page follows]

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

IN WITNESS WHEREOF, the undersigned has duly executed this Solvency and
Financial Condition Certificate on behalf of the Borrower as of the date first
written above.

 

GREAT LAKES DREDGE & DOCK CORPORATION By:     Name:   Bruce J. Biemeck Title:  
President and Chief Financial Officer

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

SCHEDULE I

COMMITMENTS

 

Lender

   Commitment  

Wells Fargo Bank, National Association

   $ 50,000,000.00   

Bank of America, N.A.

   $ 30,000,000.00   

PNC Bank, National Association

   $ 25,000,000.00   

BMO Harris Financing, Inc.

   $ 25,000,000.00   

Fifth Third Bank

   $ 25,000,000.00   

MB Financial Bank, N.A.

   $ 10,000,000.00   

Deutsche Bank AG, New York Branch

   $ 10,000,000.00   

Total

   $ 175,000,000.00   

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

Schedule 1.1(a)

Existing Hedge Banks

 

1. Wells Fargo Bank, National Association

 

2. Fifth Third Bank

 

3. Bank of America, N.A.

 

4. Merrill Lynch Commodities, Inc.

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

Schedule 1.1(b)

Existing Letters of Credit

 

L/C Number

  

Issuing Lender

  

Face Amount
(Dollar Equivalent
Amount)

  

Performance /
Financial

  

Issuance Currency

  

Expiry Date

  

Face Beneficiary

C7189650    Bank of America, N.A. (Scranton, PA)    $547,583    Financial    USD
   09/30/12    Signal Mutual Indemnity C7232060    Bank of America, N.A.
(Scranton, PA)    $77,610    Financial    USD    9/30/12    Reliance Insurance
Co. C7408627    Bank of America, N.A. (Scranton, PA)    $923,685    Financial   
USD    12/31/12    National Union Fire Insurance 68016220    Bank of America,
N.A. (Scranton, PA)    $1,500,000    Financial    USD    12/31/12    General
Electric Capital Corporation 68021042    Bank of America, N.A. (Scranton, PA)   
$530,000    Performance    USD    12/31/12    Standard Chartered Bank (Manama,
Bahrain) 68004112    Bank of America, N.A. (Scranton, PA)    $1,700,000   
Financial    USD    12/31/12    Zurich American Insurance Company 68004127   
Bank of America, N.A. (Scranton, PA)    $314,150    Performance    USD   
06/11/12    Standard Chartered Bank (Abu Dhabi, United Arab Emirates) 68004128
   Bank of America, N.A. (Scranton, PA)    $575,032    Performance   

Kuwaiti

Dinar

   06/12/12    National Bank of Kuwait (Kuwait City, Kuwait) 68004131    Bank of
America, N.A. (Scranton, PA)    $12,500,000    Financial    USD    12/31/12   
Fidelity and Deposit Co of Maryland 68004132    Bank of America, N.A. (Scranton,
PA)    $686,625    Performance   

Qatari

Riyal

   07/20/12    Qatar National Bank (Doha, Qatar) 68004133    Bank of America,
N.A. (Scranton, PA)    $3,668,517    Performance   

Bahraini

Dinar

   12/31/12    HSBC Bank Middle East (Manama, Bahrain)

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

Schedule 1.1(c)

Initial Subsidiary Guarantors

 

1. Dawson Marine Services Company

 

2. Fifty-Three Dredging Corporation

 

3. Great Lakes Dredge & Dock Company, LLC

 

4. Great Lakes Dredge & Dock Environmental, Inc.

 

5. NASDI Holdings Corporation

 

6. NASDI, LLC

 

7. Yankee Environmental Services, LLC

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

Schedule 7.1

Jurisdictions of Organization and Qualification

 

Company

  

Jurisdiction of
Organization

  

Jurisdictions of Qualification

Great Lakes Dredge & Dock Corporation    DE    CA, DE, LA, MA, TN, TX Great
Lakes Dredge & Dock Environmental, Inc.    DE    DE, IL NASDI Holdings
Corporation    DE    CA, DE, MA Dawson Marine Services Company    DE    DE
Fifty-Three Dredging Corporation    NJ    NJ Great Lakes Dredge & Dock Company,
LLC    DE    AK, AL, AR, CT, DE, FL, GA, IA, IL, IN, KS, KY, LA, MA, MD, ME, MI,
MN, MO, MS, NC, NE, NH, NJ, NY, OH, OK, OR, PA, RI, SC, SD, TN, TX, VA, WA, WI,
WV NASDI, LLC    DE    AL, CT, DE, FL, IL, IN, LA, MA MD, ME, MI, NC, NH, NJ,
NY, OH, PA, RI, TX, VA Yankee Environmental Services, LLC    DE    CT, DE, MA,
NH, NJ, NY, PA, RI, VT

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

Schedule 7.2

Subsidiaries and Capitalization

 

Subsidiary

  

Jurisdiction of
Organization

  

Equity Interests
Authorized

  

Equity Interests
Issued and
Outstanding

  

Holder of Equity Interests

  

Percentage Ownership of
Equity Interests

  

No. of Shares covered by
outstanding Options,
Warrants, Rights of
Conversion or  any other
similar plan

Great Lakes Dredge & Dock Environmental, Inc.    Delaware    1,000 Common Shares
   100 Common Shares    Great Lakes Dredge & Dock Corporation    100%    None
NASDI Holdings Corporation    Delaware    1,000 Common Shares    100 Common
Shares    Great Lakes Dredge & Dock Corporation    100%    None Dawson Marine
Services Company    Delaware    100 Common Shares    100 Common Shares   
Great Lakes Dredge & Dock Corporation    100%    None Fifty-Three Dredging
Corporation    New Jersey    100 Common Shares    100 Common Shares   
Great Lakes Dredge & Dock Company, LLC    100%    None Great Lakes Dredge &
Dock Company, LLC    Delaware    100% Membership Interest    100% Membership
Interest    Great Lakes Dredge & Dock Corporation    100%    None NASDI, LLC   
Delaware    100% Class A Interest    100% Class A Interest    NASDI Holdings
Corporation    100%    None       100% Class B Interest    100% Class B Interest
   NASDI Holdings Corporation    100%    None

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

Subsidiary

  

Jurisdiction of
Organization

  

Equity Interests
Authorized

  

Equity Interests
Issued and
Outstanding

  

Holder of Equity Interests

  

Percentage Ownership of
Equity Interests

  

No. of Shares covered by
outstanding Options,
Warrants, Rights of
Conversion or  any other
similar plan

Yankee Environmental Services, LLC    Delaware    100% Membership Interest   
100% Membership Interest    NASDI Holdings Corporation    65%    None         
   Christopher A. Berardi    15%    None             Brian Fitzsimmons    15%   
None             Phillip DeNormandie    5%    None Lydon Dredging &
Construction Company, Ltd.    Canada    500 Common Shares    500 Common Shares
   Great Lakes Dredge & Dock Company, LLC    100%    None Great Lakes Dredge &
Dock (Bahamas) Ltd.    Bahamas    5,000 Common Shares    5,000 Common Shares   
Great Lakes Dredge & Dock Company, LLC    100%    None Great Lakes Dredge & Dock
Do Brasil Ltda.    Brazil    10,000 Shares of Capital Stock    10,000 Shares of
Capital Stock    Great Lakes Dredge & Dock Corporation    99.99%    None      
      Great Lakes Dredge & Dock Company, LLC    .01%    None GLDD Mexicana, S.
de R.L. de C.V.    Mexico    500 Common Shares    500 Common Shares   
Great Lakes Dredge & Dock Company, LLC    100%    None

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

Schedule 7.9

ERISA Plans

 

1. Great Lakes Dredge & Dock Company, LLC 401(k) Saving Plan (Fidelity Plan
No. 74344)

 

2. Great Lakes Dredge & Dock Company, LLC Non-Union Hourly Employees 401(k)
Savings (Fidelity Plan No. 74346)

 

3. Great Lakes Dredge & Dock Company, LLC 401(k) Local 333 Savings Plan
(Fidelity Plan No. 23956)

 

4. LW Matteson Division of Great Lakes Dredge & Dock Company, LLC Savings Plan

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

Schedule 7.13

List of Insurance Policies

 

Coverage

  

Name(s) of Insured(s)

  

Insurer

   Policy
Number   

Maximum Limit

   Maximum
Deductible Hull & Machinery    Great Lakes Dredge & Dock Corporation and its
Subsidiaries    Gulf Coast Marine    GCM11513   

$5,000,000 per occurrence;

 

Aggregate Limit of $124,880,000 for all Designated Vessels

   $500,000 Excess Hull & Machinery    Great Lakes Dredge & Dock Corporation and
its Subsidiaries    Lloyds Syndicates (Lead – ACE Global Market)    M114748   

$34,226,600 per occurrence;

 

Aggregate Limit of $219,172,000 for all Designated Vessels

   NIL Increased Value    Great Lakes Dredge & Dock Corporation and its
Subsidiaries    Lloyds Syndicates (Lead – ACE Global Market)    M114748   

$34,226,600 per occurrence;

 

Aggregate Limit of $88,388,000 for all Designated Vessels

   NIL War Risks – Hull & P&I    Great Lakes Dredge & Dock Corporation and its
Subsidiaries    Lloyds Syndicates (Lead – ACE Global Market)    M115013   
$98,832,400/ $1,000,000    NIL Protection & Indemnity    Great Lakes Dredge &
Dock Corporation and its Subsidiaries    Gulf Coast Marine    GCM11513   
$1,000,000    $900,000 Vessel Pollution    Great Lakes Dredge & Dock Corporation
and its Subsidiaries    Water Quality Insurance Syndicate    44-81774   
$5,000,000    NIL

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

Coverage

  

Name(s) of Insured(s)

  

Insurer

   Policy Number   

Maximum Limit

  

Maximum Deductible

Marine General Liability    Great Lakes Dredge & Dock Corporation and its
Subsidiaries    Starr Indemnity & Liability    MASILHS00077711    $1,000,000   
$900,000 United States Longshore and Harborworkers    Great Lakes Dredge & Dock
Corporation and its Subsidiaries    Signal Mutual Indemnity    04500   
$1,000,000    NIL Bumbershoot Primary    Great Lakes Dredge & Dock Corporation
and its Subsidiaries    Lloyds Syndicates (Lead – Mosaic)    MUS330848-11-1   
$100,000,000 DIL of Underlying    Underlying Excess Bumbershoot    Great Lakes
Dredge & Dock Corporation and its Subsidiaries    Starr Indemnity & Liability
Co. and Syndicates    M114997    $100,000,000 excess of $100,000,000   
Underlying Contractors Pollution Liability    Great Lakes Dredge & Dock
Corporation and its Subsidiaries    Ironshore Specialty Insurance Co.   
001161800    $20,000,000    $1,000,000 Business Property and Inland Marine
(GLDD & LWM)    Great Lakes Dredge & Dock Corporation and L.W. Matteson, Inc.   
Travelers Property Casualty Company of America    QT-660-365M650A11   
$8,722,840    Equipment: $100,000 Property: $10,000 (except flood/earthquake)
Business Property and Inland Marine (NASDI & YANKEE)    NASDI, LLC and Yankee
Environmental Services, LLC    Travelers Property Casualty Company of America   
QT-660-365M6511    $12,976,849    Equipment: $10,000 Property: $1,000 (except
flood/earthquake) Commercial General Liability    Great Lakes Dredge & Dock
Corporation and its Subsidiaries    Zurich American Insurance Company   
GLO655459702    $1,000,000    $250,000 Automobile Liability    Great Lakes
Dredge & Dock Corporation and its Subsidiaries    Zurich American Insurance
Company    BAP655459502    $1,000,000    NIL (Liability)

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

Coverage

  

Name(s) of Insured(s)

  

Insurer

   Policy Number   

Maximum Limit

  

Maximum Deductible

Workers’ Compensation and Employer’s Liability    Great Lakes Dredge & Dock
Corporation and its Subsidiaries    Zurich American Insurance Company   
WC655459402    $1,000,000    $500,000 Foreign Liability (Voluntary Comp & Auto
Liability)    Great Lakes Dredge & Dock Corporation and its Subsidiaries    AIG
World Risk    WR10006520    $1,000,000    $0 Umbrella (non-Marine)    Great
Lakes Dredge & Dock Corporation and its Subsidiaries    Illinois National
Insurance Company    BE23102060    $25,000,000    $10,000 Retention & Underlying
Excess Liability (non-Marine)    Great Lakes Dredge & Dock Corporation and its
Subsidiaries    Axis Surplus Insurance    EAU757968512011    $25,000,000 excess
of $25,000,000    Underlying Commercial Crime    Great Lakes Dredge & Dock
Corporation and its Subsidiaries    Arch Insurance Company    CFP004198601   
$5,000,000    $75,000 Fiduciary Liability    Great Lakes Dredge & Dock
Corporation and its Subsidiaries    Federal Insurance Company    82231464   
$5,000,000    $0 Retention Directors’ & Officers’ Liability    Great Lakes
Dredge & Dock Corporation and its Subsidiaries    Illinois National Insurance
Company (AIG)    14240205    $10,000,000    $250,000 Retention Excess
Directors’ & Officers’ Liability    Great Lakes Dredge & Dock Corporation and
its Subsidiaries    Travelers Casualty and Surety    105544540    $10,000,000
excess of $10,000,000    Underlying Excess Directors’ & Officers’ Liability   
Great Lakes Dredge & Dock Corporation and its Subsidiaries    Great American
Insurance Company    DFX3912045    $10,000,000 excess of $20,000,000   
Underlying Excess Directors’ & Officers’ Liability    Great Lakes Dredge & Dock
Corporation and its Subsidiaries    Twin City Fire Insurance Company (Hartford)
   OODA023948911    $10,000,000 excess of $30,000,000    Underlying

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

Coverage

  

Name(s) of Insured(s)

  

Insurer

  

Policy Number

  

Maximum Limit

  

Maximum Deductible

Excess Side A Directors’ & Officers’ Liability    Great Lakes Dredge & Dock
Corporation and its Subsidiaries    Allied World National Assurance Company   
0305-1823    $50,000,000 excess of $40,000,000    Underlying Bumbershoot (Run
Off through 2/20/2018)    Great Lakes Dredge & Dock Corporation and its
Subsidiaries    Catlin Insurance/Starr Marine    M104745    $100,000,000   
Underlying

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

Schedule 9.1

Existing Indebtedness

Indebtedness related to vessels:

 

1. Bareboat Charter Agreement, dated as of October 9, 1998, as amended, between
Great Lakes Business Trust No. 1998-1 and Great Lakes Dredge & Dock Company, LLC
(Charter Financing of the New York).

 

2. Bareboat Charter Agreement, dated as of November 18, 1999, as amended,
between CEF 2002, LLC and Great Lakes Dredge & Dock Company, LLC (Bareboat
Charter of Hopper Dredge Liberty Island).

 

3. Bareboat Charter Agreement, dated as of August 27, 2002, as amended, between
CEF 2002, LLC and Great Lakes Dredge & Dock Company, LLC (Bareboat Charter of
Dump Barge GL-65).

 

4. Bareboat Charter Agreement, dated as of December 22, 2004, as amended,
between General Electric Capital Corporation and Great Lakes Dredge & Dock
Company, LLC (Bareboat Charter of G.L. 501).

 

5. Bareboat Charter Agreement, dated as of June 7, 2005, as amended, between
General Electric Capital Corporation and Great Lakes Dredge & Dock Company, LLC
(Bareboat Charter of G.L. 502).

 

6. Bareboat Charter Agreement, dated as of December 15, 2006, as amended,
between General Electric Capital Corporation and Great Lakes Dredge & Dock
Company, LLC (Bareboat Charter of Long Island).

 

7. Bareboat Charter Agreement dated November 3, 2008 between Great Lakes
Dredge & Dock Company, LLC and Banc of America Leasing & Capital, LLC (Charter
of G.L. 177).

 

8. Bareboat Charter Agreement dated July 6, 2007 between Great Lakes Dredge &
Dock Company, LLC and GATX Third Aircraft Corporation (Charter of the Terrapin
Island).

Other Indebtedness not related to vessels:

 

1. Dozer rental agreement #40261, dated as of September 22, 2009 between Key
Equipment Finance Inc. and Great Lakes Dredge & Dock Company, LLC.

 

2. Dozer rental agreement #2316-001, dated as of September 22, 2009 between Key
Equipment Finance Inc and Great Lakes Dredge & Dock Company, LLC, assigned to
People’s Capital & Leasing.

 

3. Dozer rental agreement #093-0098503-018, dated as of December 21, 2009
between Fifth Third Bank and Great Lakes Dredge & Dock Company, LLC.

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

4. Dozer rental agreement #023-0098503-026, dated as of June 21, 2010 between
Fifth Third Bank and Great Lakes Dredge & Dock Company, LLC.

 

5. Dozer rental agreement #023-098503-034, dated as of June 21, 2010 between
Fifth Third Bank and Great Lakes Dredge & Dock Company, LLC.

 

6. Dozer rental agreement #023-0098503-042, dated as of July 19, 2010 between
Fifth Third Bank and Great Lakes Dredge & Dock Company, LLC.

 

7. Dozer rental agreement #001-0018702-001, dated as of July 28, 2010 between US
Bank National and Great Lakes Dredge & Dock Company, LLC.

 

8. Dozer rental agreement #001-0606134-000, dated as of August 5, 2011 between
Caterpillar Financial Services and Great Lakes Dredge & Dock Company, LLC.

 

9. Dozer rental agreement #001-0612371-000, dated as of December 12, 2011
between Caterpillar Financial Services and Great Lakes Dredge & Dock Company,
LLC.

 

10. Dozer rental agreement #8800577032, dated as of January 30, 2012 between Key
Equipment Finance Inc. and Great Lakes Dredge & Dock Company, LLC.

 

11. Dozer rental agreement # 8800577025, dated as of January 23, 2012 between
Key Equipment Finance Inc. and NASDI, LLC.

 

12. Secured Subordinated Promissory Note dated December 31, 2010, in the
original principal amount of $7,500,000 and with an outstanding principal amount
as of the Closing Date of $5,000,000, made and delivered by Great Lakes Dredge &
Dock, LLC in favor of L.W. Matteson, Inc.

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

Schedule 9.2

Existing Liens

 

1. Liens in respect of and limited solely to property, equipment and assets
leased pursuant to those agreements listed in items 1 through 8 under the
heading “Indebtedness related to vessels” and items 1 through 11 under the
heading “Other Indebtedness not related to vessels,” in each case, set forth on
Schedule 9.1.

 

2. Liens in respect of property, equipment and assets described on Annex A
attached hereto and granted or created in connection with and securing that
certain Secured Subordinated Promissory Note dated December 31, 2010, in the
original principal amount of $7,500,000 and with an outstanding principal amount
as of the Closing Date of $5,000,000, made and delivered by Great Lakes Dredge &
Dock, LLC in favor of L.W. Matteson, Inc.

 

3. All Liens on all property, equipment, assets and other collateral described
on the UCC financing statements described on Annex B attached hereto, in each
case, which do not encumber any of the Collateral or property that would
constitute Collateral upon the occurrence of a Perfection Trigger Event.

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

ANNEX A

 

Equipment

  

Description

  

Number

LW Dredge    CAT 3516    27Z00811

Ammco Hull

 

Extension

Barge

  

No. 7505

Consisting of:

-        Five (5) standard 40x10x4 Univessel barges;

-        One (1) Stern barge 30x10x4 Univessel barge with fixed spud;

-        One (1) Traveling spud barge 40x10x4 with traveling spud carriage and
hydraulic mechanism

  

Sandpiper Dredge

 

 

Extension

Barge

  

CAT 3516

Ellicot Manufacturing Reference No. 34430

Consisting of:

-        Five (5) standard 40x10x4 Univessel barges;

-        One (1) Stern barge 30x10x4 Univessel barge with fixed spud;

-        One (1) Traveling spud barge 40x10x4 with traveling spud carriage and
hydraulic mechanism

  

27Z00806

 

 

N/A

3516 – 2000 HP Booster    CAT3516    27Z00804

MV Colee-1

50x18x5

   USCG    277527 Iowa Dredge    CAT 3516    72Z00544 Hull No. LWM 000202    CAT
3516    72Z00543

Extension

Barge

   Traveling spud barge No. 428 110x32x7 barge with spud carriage and deck
machinery   

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

ANNEX B

 

GREAT LAKES DREDGE & DOCK CORPORATION

JURISDICTION: SECRETARY OF STATE OF THE STATE OF DELAWARE

SECURED PARTY

  

DATE FILED

  

FILE NO.

CIT COMMUNICATIONS FINANCE CORPORATION    12/08/08    2008 4050330

 

GREAT LAKES DREDGE & DOCK COMPANY, LLC

JURISDICTION: SECRETARY OF STATE OF THE STATE OF DELAWARE

SECURED PARTY

  

DATE FILED

  

FILE NO.

GENERAL ELECTRIC CAPITAL CORPORATION    10/03/05 and continued on 08/03/10   
53046522 THE CIT GROUP/EQUIPMENT FINANCING, INC.    04/19/07    2007 1460368 THE
CIT GROUP/EQUIPMENT FINANCING, INC.    05/25/07    2007 1978906 THE CIT
GROUP/EQUIPMENT FINANCING INC.    08/17/07    2007 3143293 FIRST BANK & TRUST   
06/24/08    2008 2155909 BANC OF AMERICA LEASING & CAPITAL, LLC    11/03/08   
2008 3690516 FIRST BANK & TRUST    12/04/08    2008 4032239 FIRST BANK & TRUST
   12/05/08    2008 4038251 FIRST BANK & TRUST    12/12/08    2008 4135610 FIRST
BANK & TRUST    01/13/09    2009 0121894 MERCHANTS CAPITAL RESOURCES, INC.   
10/09/09    2009 3264592 PEOPLE’S CAPITAL AND LEASING CORP.    10/22/09    2009
3396295 U.S. BANCORP EQUIPMENT FINANCE, INC.    12/04/09    2009 3878706 THE
FIFTH THIRD LEASING COMPANY    12/31/09    2009 4187446 BANK OF THE WEST   
01/11/10    2010 0180079 GREAT LAKES BUSINESS TRUST NO. 1998-1    06/23/10   
2010 2200131 THE FIFTH THIRD LEASING COMPANY    06/29/10    2010 2261000 THE
FIFTH THIRD LEASING COMPANY    06/29/10    2010 2261075 U.S. BANCORP EQUIPMENT
FINANCE, INC.    08/02/10    2010 2678401 THE FIFTH THIRD LEASING COMPANY   
08/05/10    2010 2726580 UNITED RENTALS (NORTH AMERICA), INC.    12/14/10   
2010 4416800 L.W. MATTESON, INC.    12/31/10    2010 4660993 CATERPILLAR
FINANCIAL SERVICES CORPORATION    10/20/11    2011 4058965 CATERPILLAR FINANCIAL
SERVICES CORPORATION    10/20/11    2011 4058973

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

GREAT LAKES DREDGE & DOCK COMPANY, LLC JURISDICTION: SECRETARY OF STATE OF THE
STATE OF DELAWARE

SECURED PARTY

  

DATE FILED

  

FILE NO.

CATERPILLAR FINANCIAL SERVICES CORPORATION    10/20/11    2011 4058981
CATERPILLAR FINANCIAL SERVICES CORPORATION    10/20/11    2011 4059302
CATERPILLAR FINANCIAL SERVICES CORPORATION    10/20/11    2011 4059351
CATERPILLAR FINANCIAL SERVICES CORPORATION    10/21/11    2011 4066406
CATERPILLAR FINANCIAL SERVICES CORPORATION    10/24/11    2001 4097336
CATERPILLAR FINANCIAL SERVICES CORPORATION    12/27/11    2011 4966100
CATERPILLAR FINANCIAL SERVICES CORPORATION    12/27/11    2011 4966118
CATERPILLAR FINANCIAL SERVICES CORPORATION    12/27/11    2011 4966126
CATERPILLAR FINANCIAL SERVICES CORPORATION    12/27/11    2011 4966134
CATERPILLAR FINANCIAL SERVICES CORPORATION    12/27/11    2011 4966142
CATERPILLAR FINANCIAL SERVICES CORPORATION    12/27/11    2011 4966159
CATERPILLAR FINANCIAL SERVICES CORPORATION    12/27/11    2011 4966167
CATERPILLAR FINANCIAL SERVICES CORPORATION    12/27/11    2011 4966175 KEY
EQUIPMENT FINANCE INC.    02/08/12    2012 0501082

 

GREAT LAKES DREDGE & DOCK COMPANY, LLC JURISDICTION: NEW JERSEY DEPARTMENT OF
TREASURY/COMMERCIAL RECORDING

SECURED PARTY

  

DATE FILED

  

FILE NO.

BCC EQUIPMENT LEASING CORPORATION    08/28/02 and continued on 05/21/12   
21194627 BCC EQUIPMENT LEASING CORPORATION    11/26/02 and continued on 09/12/07
   21327834 GENERAL ELECTRIC CAPITAL CORPORATION    12/23/04 and continued on
07/02/09    22730381 GENERAL ELECTRIC CAPITAL CORPORATION    06/09/05 and
continued on 05/04/10    23019126 IOS CAPITAL    06/25/07    24234474
CATERPILLAR FINANCIAL SERVICES CORPORATION    01/30/09    25113655

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

NASDI, LLC JURISDICTION: SECRETARY OF STATE OF THE STATE OF DELAWARE

SECURED PARTY

  

DATE FILED

  

FILE NO.

DCFS USA LLC    09/26/08    2008 3272943 DCFS USA LLC    10/02/08    2008
3336748 VFS US LLC    06/18/09    2009 1950069 US BANCORP    08/28/09    2009
2785183 CATERPILLAR FINANCIAL SERVICES CORPORATION    10/18/10    2010 3624024
WEBSTER CAPITAL FINANCE, INC.    03/24/11    2011 1086357 KEY EQUIPMENT FINANCE
INC.    01/26/12    2012 0321812

 

YANKEE ENVIRONMENTAL SERVICES, LLC JURISDICTION: SECRETARY OF STATE OF THE STATE
OF DELAWARE

SECURED PARTY

  

DATE FILED

  

FILE NO.

CIT COMMUNICATIONS FINANCE CORPORATION    12/08/08    2008 450330

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

Schedule 9.3

Investments

 

1. Investments (including an equity Investment) existing on the Closing Date and
relating to that certain Joint Venture Agreement, dated January 24, 1989, as
amended, between Great Lakes and Ralph Clayton & Sons Materials, LP (Amboy
Aggregates Joint Venture). As of March 31, 2012, the book value of such
Investments was approximately $5,708,000.

 

2. Investments (including an equity Investment) existing on the Closing Date and
relating to that certain Operating Agreement of Lower Main Street Development,
L.L.C., dated February 21, 2003, as amended, between Fifty-Three Dredging
Company and DBD, L.L.C. As of March 31, 2012, the book value of such Investments
was approximately $1,200,000.

 

3. Investments (in the form of services rendered, advances or other ordinary
course transactions) existing on the Closing Date and relating to that certain
Joint Venture Agreement, dated August 29, 2002, as amended, among
Connolly-Pacific Company, Great Lakes and Manson Construction Co. This joint
venture was created to obtain and perform a contract with USAED—Los Angeles
Contracting Division relating to the Port of Los Angeles Channel Deepening, Los
Angeles and Long Beach Harbors, San Pedro Bay, California.

 

4. Investments (in the form of services rendered, advances or other ordinary
course transactions) existing on the Closing Date and relating to that certain
Joint Venture Agreement, dated February 15, 2006, as amended, between A.A. Nass
Contracting WLL and Great Lakes. This joint venture was created to obtain and
perform a contract for Diyaar Al Muharraq Company WLL relating to the Diyaar Al
Muharraq project in Manama, Bahrain.

 

5. Investments (in the form of services rendered, advances or other ordinary
course transactions) existing on the Closing Date and relating to that certain
Joint Venture Agreement, dated December 19, 2004, as amended, between A.A. Nass
Contracting WLL and Great Lakes. This joint venture was created to obtain and
perform a contract for Durrat Khaleej Al Bahrain Co. relating to the Durrat Al
Bahrain project in Manama, Bahrain.

 

6. Investments (in the form of services rendered, advances or other ordinary
course transactions) existing on the Closing Date and relating to that certain
Joint Venture Agreement, dated December 11, 2011 between A.A. Nass Contracting
WLL and Great Lakes. This joint venture was created to obtain and perform a
contract for the Kingdom of Bahrain relating to the East Hidd project in Manama,
Bahrain.

 

7.

Investments (in the form of cash advances and contributions of approximately
$100,000, as well as in the form of services rendered, other advances or other
ordinary course transactions) existing on the Closing Date and relating to that
certain Joint Venture

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

Agreement dated July 9, 2011, as amended, among Great Lakes Dredge & Dock
Environmental, Inc. and Environmental Remediation Holding Inc. This joint
venture was named TerraSea Environmental Solutions, LLC and was created to
pursue environmental contracting projects and related business ventures.

 

8. Investments in the form of working capital advances and deposits in the
amount of approximately $622,000 made on or prior to the Closing Date and
relating to those Working Capital and Deposit Escrow agreements dated
November 9, 2011, December 1, 2011 and December 23, 2011 among Great Lakes and a
developer. This business transaction was entered into to support a remediation
project based in Perth Amboy, NJ.

 

9. Investments in the form of a working capital contribution in the amount of
$600,000 made on or prior to the Closing Date and relating to the business
association and draft agreement among Great Lakes and Dredging International
(Australia) Pty Ltd. This business association was entered into to obtain and
perform a contract with Bechtel Western Australia Pty Ltd relating to the
Wheatstone LNG project in Onslow, Australia.

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

Schedule 9.7

Transactions with Affiliates

 

1. NASDI, LLC (successor-by-conversion to North American Site Developers, Inc.)
(“NASDI”) entered into a Lease dated as of December 31, 2006 with MJC Berry
Enterprises, LLC (“MJC”) pursuant to which NASDI leases from MJC the premises at
1365 Main Street, Waltham, Massachusetts for a term expiring on December 31,
2016 (subject to extension) (the “Lease”). MJC is owned and controlled by
Christopher A. Berardi who is a minority member of Yankee Environmental
Services, LLC. Great Lakes Dredge & Dock Company, LLC executed a Guaranty dated
December 31, 2006 pursuant to which it guaranties the obligations of NASDI under
the Lease.

 

2. Kathleen M. LaVoy, Chief Legal Officer, Chief Compliance Officer and
Secretary of Great Lakes Dredge & Dock Corporation, is the daughter of Douglas
B. Mackie, who is a member of the board of directors of Great Lakes Dredge &
Dock Corporation.

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Schedule 12.10

List of Competitors

 

1. Manson Construction Co.

 

2. Weeks Marine, Inc.

 

3. Norfolk Dredging Company

 

4. Donjon Marine Company, Inc.

 

5. Orion Marine Group, Inc.

 

6. Cashman Dredging Co.

 

7. The Dutra Group

 

8. Mike Hooks, Inc.

 

9. Van Oord N.V.

 

10. Royal Boskalis Westminster N.V.

 

11. Dredging, Environmental and Marine Engineering N.V.

 

12. Jan De Nul Group